Highlighted links for June 12, 2023

Below are links from our NewsBase to other noteworthy reports published in the last 24 hours from and about China.

BUSINESS AND TECHNOLOGY:

Economic woes
China, its economy flagging, prods consumers to save less and spend more / NYT (paywall)
“China’s largest state-run banks lowered interest rates on deposits this week. The rate cuts, the second such reductions since last year, reflect a growing concern that the world’s second-largest economy has not rebounded as strongly as expected after lifting its restrictive ‘zero-COVID’ measures.”
Where are Chinese consumers willing to spend? / Caixin (paywall)
“Chinese consumers are resuming spending on travel and dining out but are not buying necessities and other consumer goods as much as before the pandemic.”
Iron ore sheds nearly 5% after Goldman’s China property warning / Caixin (paywall)
“Iron ore fell for the first time in nine sessions as Goldman Sachs Group Inc. warned that property weakness would likely be a multi-year growth drag for China’s economy.”
China’s property sector set to be persistently weak for years — -Goldman / Reuters
“China’s property sector is expected to grapple with ‘persistent weakness’ for years, Goldman Sachs analysts said, adding that its problems would continue to drag on the country’s economic growth.”
China’s paper consumption crumples on economic slump / Nikkei Asia (paywall)
“Chinese consumption of paper and paperboard declined in 2022 for the first time in four years, as the country’s stringent coronavirus measures slowed the economy.”

Digital currency
China launches digital yuan ATMs in tropical Sanya, allowing tourists to exchange foreign cash for e-CNY / SCMP (paywall)
“A new e-CNY foreign exchange machine is China’s latest bid to court tourists to its tropical southern vacation hotspot Sanya, on Hainan island, by allowing people to exchange 20 currencies for digital yuan, a move that could give visitors greater access to a ubiquitous local mobile payments ecosystem.”

Automobile industry
China mounts six-month campaign to get car sales moving / Caixin (paywall)
“China launched a six-month campaign to boost car purchases and drive electric vehicle adoption in rural areas as sales growth of EVs slowed in the world’s biggest auto market.”

Electric vehicles
China’s NIO cuts prices, ends free battery swapping as sales slide / Nikkei Asia (paywall)
“NIO said on Monday it would lower prices for all its models and end free battery swapping services to new buyers, as the Chinese electric vehicle maker faces mounting pressure over earnings losses and lukewarm sales.”
EV-battery giant CATL teams up with Thai automaker / Caixin (paywall)
“Electric-vehicle (EV) battery giant Contemporary Amperex Technology Co. Ltd. (CATL) has signed an agreement with Thai automaker Arun Plus Co. Ltd. to jointly manufacture batteries in the Southeast Asian country.”

Chips
Tech war: China’s semiconductor equipment purchases slump as U.S. and allies boost domestic chip production, data shows / SCMP (paywall)
“Sales of semiconductor equipment to China dropped 23% year-on-year in the first quarter amid U.S. export curbs, according to SEMI data.”
Tech war: Chinese manufacturers brace for the impact of Japan’s semiconductor export curbs / SCMP (paywall)
“Chinese companies are scrambling to seek local substitutes to cut reliance on Japanese suppliers as they brace for the impact of Tokyo’s export curbs on semiconductor equipment and materials, according to corporate statements and analysts.”
Ex-Samsung executive alleged to have stolen tech to recreate chip plant in China / FT (paywall)
“A former executive at Samsung Electronics has been arrested and indicted in South Korea for allegedly stealing the leading chipmaker’s technology in order to build a copycat plant in China.”

Is China investible?
General Atlantic says China remains strong bet despite U.S. tensions / FT (paywall)
“General Atlantic, the U.S. private equity firm known for big bets on ByteDance and fast-fashion retailer Shein, said China remains a top investment destination even as the clash between Beijing and Washington prompts other western groups to pull back.”
Chinese tech groups suffer as foreign investors take flight / FT (paywall)
“Geopolitical tension and poor economic recovery drive stock price falls and funding shortages.”

Banking
Foreign banks left out of initial public offerings in China / FT (paywall)
“Foreign banks’ involvement in initial public offerings in mainland China has fallen to its lowest level in more than a decade, in a sign of the difficulties they face retaining a foothold in the country’s closed-off financial system.”

Yuan stability
How can China keep the yuan stable amid heightened global uncertainty / Caixin (paywall)
“The yuan’s exchange rate has a significant impact on international trade, and it is also a channel for financial risk to spread into China from overseas. Therefore, it is crucial to keep it stable, and the People’s Bank of China (PBOC) has developed a slew of tools to do just that.”

AI
TikTok owner tests ChatGPT-style bot after joining China AI race / Caixin (paywall)
“ByteDance Ltd. is testing an artificial intelligence-powered chatbot among employees, joining rival Chinese internet conglomerates from Alibaba to Baidu in a race to create a local version of ChatGPT.”
OpenAI’s CEO calls on China to help shape AI safety guidelines / Caixin (paywall)
“China should play a key role in shaping the artificial intelligence (AI) guardrails needed to ensure the safety of transformative new systems, OpenAI Inc.’s Chief Executive Officer Sam Altman said.”
Microsoft to move top AI experts from China to new lab in Canada / FT (paywall)
“Microsoft is moving some of its best artificial intelligence researchers from China to Canada in a move that threatens to gut an essential training ground for the Asian country’s tech talent.”

China’s power grid
China changes pricing model for world’s largest power grid / Caixin (paywall)
“This month China flipped the switch on a new electricity pricing model that treats all businesses as favorably as large industrial users while continuing to subsidize costs to residential and agricultural customers. The changes are intended to bring fairer and more transparent rates as well as a more efficient distribution throughout the world’s largest power grid.”

SCIENCE, HEALTH, AND ENVIRONMENT:

COVID-19
Latest COVID-19 outbreak has peaked with 164 deaths, China CDC says / SCMP (paywall)
“China’s latest Covid-19 wave has peaked with nearly 2,800 severe cases and 164 deaths – much lower than during the winter surge, according to health authorities.”
China greenlights homegrown COVID shot that guards against dominant strain / Caixin (paywall)
“China has approved the emergency use of a domestically developed Covid vaccine that guards against what is currently the most dominant strain of the virus globally.”

Extreme weather
Three die, farmland and trees damaged as storms sweep across China / Reuters
“Three people died in eastern China after strong winds toppled a shipyard crane, authorities said on Sunday, as storms caused damage across the country, including large swaths of farmland.”

Nuclear power
China and Russia account for 70% of new nuclear plants / Nikkei Asia (paywall)
“Russia and China are building up an outsized presence in the field of nuclear power, with the countries accounting for nearly 70% of reactors under construction or in planning worldwide.”

POLITICS AND FOREIGN AFFAIRS:

Graft-busting at home and abroad
Court papers open rare window into role of graft in China’s overseas lending / WSJ (paywall)
“For more than a decade, a Chinese state-bank executive named [Daì Chūnníng 戴春宁] served as a leading foot soldier in Beijing’s campaign to win influence in the developing world using the power of finance.”
Ex-PBOC deputy governor accused of bribery, abuse of power / Bloomberg (paywall)
“China’s former central bank Deputy Governor [Fàn Yīfēi 范一飞] was removed from the Communist Party and stripped of his official post after authorities accused him of taking ‘massive’ amounts of bribes among a list of other wrongdoings.”

Nuclear missiles and other defense tech
Could this 1-dollar Chinese adhesive defeat a billion-dollar U.S. laser weapon? / SCMP (paywall)
“Scientists in China who have been experimenting with materials to protect drones and missiles from laser attacks say they have discovered a surprising potential solution – adhesive.”
China raises nuclear arsenal by 60 warheads: think tank / Nikkei Asia (paywall)
“China increased its nuclear arsenal by 60 warheads to 410 in the 12 months to January 2023, an international security think tank said Monday, adding that the increase was more than in any of the other nine nuclear-armed states.”

Hong Kong censorship
Hong Kong court postpones hearing over government’s bid to ban ‘Glory to Hong Kong’ protest song / SCMP (paywall)
“A Hong Kong court has postponed hearing a government request for banning a popular protest song to allow anyone wishing to defend the tune a chance to prepare for litigation.”
Hong Kong protest anthem tops iTunes chart after government seeks court ban / FT (paywall)
“Hongkongers are rushing to download a popular protest anthem after the Chinese territory’s government filed for a court injunction that could compel U.S. technology giants such as Google and Meta to block access to it.”

Singapore
China, U.S. must step back from confrontation, Singapore Deputy Prime Minister says / Caixin (paywall)
“China and the U.S. can step away from confrontation and ‘must do so’ as the international community does not want to be forced to choose sides between the world’s two largest economies, Singapore’s Deputy Prime Minister Heng Swee Keat said Monday at Caixin’s inaugural Asia New Vision Forum.”

Taiwan
Taiwan sends up fighters as Chinese warplanes cross strait’s median line / Reuters
“Taiwan’s air force scrambled into action on Sunday after spotting 10 Chinese warplanes crossing the sensitive median line of the Taiwan Strait, as the island’s defence ministry said four Chinese warships also carried out combat patrols.”
Exclusive: Taiwan foreign minister to make Europe trip next week / Reuters
“Taiwan Foreign Minister Joseph Wu [呉钊燮 Wú Zhāoxiè] will make a previously unannounced visit to Europe next week, four sources briefed on the matter said, and is expected to appear with the Czech president at one event in a diplomatic breakthrough.”

U.S.-China competition and tensions
Factbox: Top U.S.-China exchanges since Biden took office / Reuters
“U.S. Secretary of State Antony Blinken will travel to China next week for long-delayed talks aimed at stabilizing tense relations in what will be the first such visit by Washington’s top diplomat in five years.”
Blinken to travel to China next week, carrying out trip postponed after spy balloon incident / AP
Is this the hoped-for thaw in U.S.-China relations or a new era of managing differences? / SCMP (paywall)
“Talks between senior Chinese and U.S. officials in recent weeks have given hope that tension between the world’s two great powers could be easing.”
Can warmer ties overcome the deepening divide in U.S.-China relations? / SCMP (paywall)
China-U.S. rivalry worries people in Singapore, South Korea, Philippines / SCMP (paywall)
“The fierce stand-off between the US and China is a big concern in three Asian countries, with more than 90 per cent of respondents to a new survey expressing worries about a ‘new geopolitical confrontation’ between Beijing and Washington.”
Biden executive order on investments in China faces hurdles / Nikkei Asia (paywall)
“The Biden administration’s long-expected outbound screening mechanism for U.S. investment in China continues to be delayed as the White House tries to get key allies on board while navigating domestic pushback in Congress and on Wall Street.”

White House denies China-Cuba spy base
White House denies report that China is building a spy base on Cuba / Bloomberg (paywall)
Pentagon dismisses WSJ report on China spy station in Cuba / Reuters
Cuba’s spy deal with China has echoes of Cold War tensions / WSJ (paywall)
“Planned surveillance facility adds a new source of conflict with [the] U.S. after short-lived rapprochement between Havana and Washington.”
China has been spying from Cuba for some time, U.S. official says / Reuters
“China has been spying from Cuba for some time and upgraded its intelligence collection facilities there in 2019, a Biden administration official said on Saturday, following a report about a new spying effort underway on the island.”
U.S. confirms China has had a spy base in Cuba since at least 2019 / AP
China says allegations of Chinese spying in Cuba are false / Reuters
“China said on Monday that allegations that it was using Cuba as a spying base are false and it denounced the U.S. government and media for releasing what it called inconsistent information.”

South China Sea
Coastguard drills with Philippines, Japan the latest sign of U.S.-driven security cooperation / SCMP (paywall)
“As defense chiefs and security experts from the Asia-Pacific and beyond gathered in Singapore for the Shangri-La Dialogue, coastguards from the Philippines, the United States and Japan held their first joint drills in the disputed South China Sea last week. The move was part of a growing web of minilateral security groupings emerging in response to shared security concerns.”

ASEAN
ASEAN caught in ‘economic cold war’ over China: Business lobby head / Nikkei Asia (paywall)
“Southeast Asia is grudgingly open to helping European, U.S. and Japanese industries lessen their dependence on China, but needs to see more aggressive investment from them to do so, the head of a regional business lobby told Nikkei Asia.”

Japan
China lures increasing numbers of research scholars from Japan / Nikkei Asia (paywall)
“An increasing number of Japanese scholars are filling research posts at universities and laboratories in China. In the past, China had mainly welcomed engineers from Japanese companies, but it is now looking to attract academics in astronomy and other basic fields of science.”

South Korea
China complains to South Korea over protest on envoy’s comments / Reuters
“China’s assistant foreign minister summoned South Korea’s Ambassador to China on Saturday to issue a complaint over Seoul’s criticism of recent comments made by China’s envoy in South Korea, China’s foreign ministry said on Sunday.”
China complains to South Korean ambassador in tit-for-tat move after Seoul summoned Beijing’s envoy / AP

New Zealand
New Zealand PM Hipkins to visit China at the end of June / Nikkei Asia (paywall)
“New Zealand Prime Minister Chris Hipkins said on Monday he will visit China at the end of this month at the head of a trade delegation.”

Saudi Arabia
Saudi Arabia and China pledge to work together in food security, science, energy and investments, ‘ignoring’ Western ire / SCMP (paywall)
“Saudi Arabia and China will work together in food security, science, investments and energy, bringing the world’s largest oil producer and its number one customer into a tighter embrace as they embark on a golden age of bilateral relations.”

Cambodia
Cambodia breaks ground on China-funded highway to Vietnam border / Nikkei Asia (paywall)
“Construction began this week on an expressway linking Cambodia’s capital to the Vietnamese border town of Bavet, with financial assistance from China as Beijing’s influence here continues to grow.”

Myanmar
China’s dual aims in Myanmar: Indian Ocean access, crime fighting / Nikkei Asia
“In the more than two years since Myanmar’s military took control of the government, China has clearly become the biggest backers of the generals who now hold power.”

Honduras
Honduras opens embassy in China after cutting ties to Taiwan / Reuters
“Honduras opened an embassy in China on Sunday, Chinese state media reported, after the Central American nation cut diplomatic relations with Taiwan earlier this year.”
Honduras opens embassy in China after breaking off ties with Taiwan / AP
Honduras opens embassy in China after cutting ties to Taiwan / Nikkei Asia (paywall)

India
China hopes India can meet it halfway in media row / Reuters
“China called on Monday on India to meet it halfway in a dispute over journalists working in each other’s countries after China said its reporters in India had been treated unfairly and an Indian journalist was asked to leave China.”
India, U.S. boost defense ties with Russia, China in mind: ‘things are changing’ / SCMP (paywall)
“From an ambitious new defense cooperation plan to the co-production of military hardware and potential big-ticket arms deals for fighter jet technology, the United States and India are stepping up their military ties.”

SOCIETY AND CULTURE:

Marriage
Marriages in China slump to historic low / Reuters
“Marriages in China dropped in 2022 to their lowest since records began, local news outlet Yicai reported on Sunday, continuing a steady decline over the past decade although the matrimonial total may have been affected by stringent COVID lockdowns.”
China marriage registrations hit record low of 6.83m in 2022 / Nikkei Asia (paywall)

Cyberbullying
China seeks stronger measures to curb cyberbullying / Caixin (paywall)
“China’s top judicial and law enforcement authorities on Friday unveiled draft guidelines aimed at toughening penalties for cyberbullying, after a string of high-profile deaths exposed how regulatory measures are inadequate to curb the abuses.”