Highlighted links for June 21, 2023

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

BUSINESS AND TECHNOLOGY:

German car companies talk up China, but they have a Uyghur problem
1Strong relations between BMW and China a ‘win-win’ -CEO / Reuters
“BMW’s strong ties with China are a “win-win” as the car industry shifts towards greener, more connected vehicles, said CEO Oliver Zipse after Chinese Premier Lǐ Qiáng 李强 visited the German carmaker’s headquarters in Munich on Wednesday.”
German carmakers challenged over Xinjiang due diligence in rights group complaint / Reuters
“Germany’s top carmakers have been accused by a Berlin-based human rights group of not showing they have carried out due diligence to prevent the risk of forced labor being used by their suppliers in Xinjiang, China, a potential violation of Germany’s new supply chain law.”
Volkswagen, BMW and Mercedes hit by Xinjiang forced labor complaint / FT (paywall)

Electric vehicles
China unveils $72 bln tax break for EVs, other green cars to spur demand / Reuters
“China unveiled on Wednesday a 520 billion yuan ($72.3 billion) package of tax breaks over four years for electric vehicles (EVs) and other green cars, its biggest yet for the industry as it seeks to boost slower auto sales growth.”

Flying cars
Flying car maker Lilium plans China office as step toward approval for sales / Caixin (paywall)
“Tencent-backed German aerospace company Lilium plans to set up a regional headquarters in southern China’s Shenzhen as a first step in a partnership to sell its all-electric air vehicle in the Asia-Pacific region, starting in the Greater Bay Area.”

F&B firms summoned by Chinese regulators for data issues
Shanghai regulators summon Starbucks, Shake Shack citing excessive personal data collection / Reuters
“Chinese regulators in financial hub Shanghai summoned three firms including Starbucks and Shake Shack earlier this week for collecting excessive personal information, the city’s cyberspace regulator said on Wednesday.”

Steel industry
China steel industry faces growing pressure to consolidate / Nikkei Asia (paywall)
“China’s steel industry is undergoing a shakeout as the government pushes for mergers and production cuts in hopes of ending chronic oversupply. But problems are expected to linger because of slow progress in the drive to reduce excess capacity.”

Interest rates
China to tread warily on easing as concerns over impact on banks mount / Reuters
“China’s central bank is likely to cut lending rates further in a bid to revive the economy but reluctance among private firms and households to borrow means continued policy easing could end up hurting banks already battling margin pressures, analysts said.”
China cuts borrowing rates again in bid to juice recovery / WSJ (paywall)
“Economists say that more drastic measures may be needed, with debt and uncertainty continuing to weigh on consumers’ willingness to spend.”

Luxury goods
Chinese luxury goods: the bear case / FT (paywall)
“A yawning gap between China’s rich and poor works to the advantage of European luxury goods groups with heavy exposure to the country, with higher income apparently correlating with stronger demand for discretionary items like velvet loafers and Cartier watches.”

Cautious consumers
Chinese consumers remain cautious on spending, chase bargains and discounts amid slowing economy: study / SCMP (paywall)
“Chinese consumers remain cautious on loosening their purse strings, with many inclined to hunt for bargains amid a gloomy economic outlook, according to a joint study by global consultancy Bain & Co and market research firm Kantar Worldpanel.”

Local government debt
China begins nationwide push to reveal hidden government debt / Bloomberg (paywall)
“China has begun a fresh round of nationwide inspections to work out how much money local governments’ owe, according to people familiar with the matter, a sign that authorities are preparing to take concrete steps to tackle a key financial risk.”

China’s slow economic recovery
China’s flagging recovery cause for global concern / Nikkei Asia (paywall)
“The Chinese economy has been freed from the dampening effects of the stringent zero-COVID policy, but it is displaying a troubling lack of resilience. Some are even discussing the possibility of deflation caused by insufficient demand, raising concerns about downward pressure on the slowing global economy.”

Pessimism in Hong Kong
How Hong Kong’s multinationals and global funds are preparing for the worst / FT (paywall)
“A phrase you hear used with a lot more friction than before, remarks a senior Hong Kong investment banker on the theme of geopolitics, is ‘worst-case scenario.’”

SCIENCE, HEALTH, AND ENVIRONMENT:

Astronomy and computing
Chinese scientists use quantum computing to simulate black hole / SCMP (paywall)
“A Chinese-led team of scientists say they have simulated the physics of black holes using quantum computing.”

Exodus of Chinese-American scientists
Science pays price as China talent returns / SCMP (paywall)
“The exodus of Chinese-American scientific talent back to the mainland continues apace. Xiè Xiǎoliàng 谢晓亮, a respected Harvard professor, is the latest Chinese scientist to give up his U.S. citizenship to return to the land of his birth.”

From clean energy to coal
Amid prolonged drought, China’s hydropower hubs turn to coal / Sixth Tone
“The situation has experts concerned over power supply and transmission during the upcoming summer, when demand is expected to surge exponentially.”

POLITICS AND FOREIGN AFFAIRS:

Hong Kong
Hong Kong pollster plans to limit questions on sensitive topics, including Tiananmen crackdown / AP
“One of Hong Kong’s most reputable sources for public opinion data is limiting its survey scope, including on sensitive topics such as the Tiananmen crackdown. The change, on the heels of a risk assessment done by the government, would likely muffle access to information showing changes in public sentiment toward the city.”

Tibet
Tibet leader calls on China to avoid crisis of two Dalai Lamas / Bloomberg (paywall)
“Any attempt by China to find its own reincarnation of Tibetan spiritual leader the Dalai Lama may result in two different successors and a ‘lifelong headache’ for Beijing, the leader of Tibet’s government-in-exile said.”

Taiwan
Taiwan reports Chinese aircraft carrier sailed through strait / Reuters
“A Chinese aircraft carrier group led by the vessel Shandong sailed through the sensitive Taiwan Strait on Wednesday, Taiwan’s defense ministry said, amid heightened military tension over the island Beijing claims as its own territory.”
Taiwan on alert for Chinese-funded election interference / Reuters
“Taiwan’s government says China will try to interfere in key elections in January by illicitly funding Beijing-friendly candidates using communications apps or group tours, according to three internal security reports reviewed by Reuters.”
Chinese official blasts U.S. over Taiwan after Blinken-Xi meeting / Bloomberg (paywall)
“China accused the U.S. of tampering with its political promises on Taiwan, days after a high-level meeting brought hope of stabilizing ties, showing the limits to resolving fundamental differences between the world’s two largest economies.”

U.S.-China competition and tensions
Biden says Xi was unaware of wayward balloon, wants relationship / Bloomberg (paywall)
“Chinese President Xí Jìnpíng 习近平 was unaware that the alleged spy balloon that floated over the continental U.S. had blown off course until the matter became an international incident, President Joe Biden told donors on Tuesday.”
China says Biden comments likening leader Xi to a dictator are ‘extremely absurd and irresponsible’ / AP
“China on Wednesday called comments by U.S. President Joe Biden referring to Chinese leader Xi Jinping as a dictator ‘extremely absurd and irresponsible.’”
China lashes back as Biden labels Xi a ‘dictator’ / Reuters
“China hit back on Wednesday after U.S. President Joe Biden referred to President Xi Jinping as a ‘dictator,’ saying the remarks were absurd and a provocation, in an unexpected spat immediately following efforts by both sides to lower tensions.”
China hits out at U.S. after Joe Biden calls Xi Jinping a ‘dictator’ / FT (paywall)
China says Biden calling Xi Jinping a dictator is ‘provocation’ / Bloomberg (paywall) Cooperation or competition? China’s security industry sees the U.S., not AI, as the bigger threat / AP
“After years of breakneck growth, China’s security and surveillance industry is now focused on shoring up its vulnerabilities to the United States and other outside actors, worried about risks posed by hackers, advances in artificial intelligence and pressure from rival governments.”
U.S. and China are talking at a high level again, but their rivalry remains unchecked / AP
“The United States and China may be back to talking at a high level, but their battle for global power and influence remains unchecked and mutual suspicion still runs deep.”
Why haven’t China and the U.S. agreed to restore military contacts? / AP
“U.S. Secretary of State Antony Blinken has wrapped up a closely watched visit to Beijing during which he and President Xi Jinping pledged to stabilize plunging U.S-China ties. But China refused the biggest U.S. request: restoring military-to-military contacts.”
China’s Xi greets U.S. diplomat Blinken with power moves / Nikkei Asia (paywall)
“In his meeting with U.S. Secretary of State Antony Blinken, Chinese President Xi Jinping took pains to project diplomatic strength, rebuffing calls to resume military dialogue and even physically setting himself apart from his guest with an unusual seating arrangement.”
China and U.S. move to ratchet down tensions / Caixin (paywall)
“President Xi Jinping met with U.S. Secretary of State Antony Blinken Monday in Beijing in a sign of thawing in relations as the world’s two largest economies seek to reduce tensions and the risk of miscalculations.”
Blinken to seek China’s help curbing deadly fentanyl traffic in landmark visit / WSJ (paywall)
“Secretary of State Antony Blinken is expected to seek Beijing’s help curbing international traffic in the deadly synthetic opioid fentanyl when he visits, in a bid to remove an irritant from the contentious U.S.-China relationship.”
Blinken visit reveals chasm in how U.S. and China perceive rivalry / NYT (paywall)
“Xi Jinping and nationalistic Chinese see recent U.S. actions as an effort to contain another superpower rather than compete with it — and they’re pushing back.”
Private eye found guilty of acting as illegal Chinese agent / WSJ (paywall)
“A private investigator and another man were found guilty on Tuesday of acting as illegal agents of the Chinese government in a harassment campaign of a former Chinese official and his family living in New Jersey.”

Spy facilities in Cuba
Chinese spy facilities in Cuba are ‘serious concern’, says Blinken / FT (paywall)
“U.S. secretary of state Antony Blinken raised concerns with China about its alleged electronic spying facilities in Cuba during a two-day mission to Beijing aimed at stabilizing turbulent relations between the powers.”
U.S. tracked Huawei, ZTE workers at suspected Chinese spy sites in Cuba / WSJ (paywall)
“During the Trump administration, U.S. officials reviewed intelligence that tracked workers from the Chinese telecom giants Huawei Technologies and ZTE entering and exiting facilities suspected of housing Chinese eavesdropping operations in Cuba, according to people familiar with the matter.”

Australia
Can Australia break China’s monopoly on critical minerals? / The Economist
“Just as oil was weaponized by its suppliers in the 1970s, so China’s dominance in the supply and processing of critical minerals could prove threatening.”

India
On the menu for Narendra Modi U.S. visit: countering China / WSJ (paywall)
“President Biden will roll out the red carpet this week for a complicated guest: Narendra Modi, whose country is a vital bulwark against China but whose government has a checkered record on human rights.”

Argentina
China backs Argentina’s Falklands claim, calls for end to ‘colonial thinking’ / SCMP (paywall)
“A Chinese ambassador to the United Nations Geng Shuang has backed Argentina’s claim to the Falkland Islands and called on countries to abandon ‘colonial thinking,’ warning of its serious implications for the international order.”

South Korea
South Korea’s ‘overwhelming pro-U.S.’ Pacific tilt triggers alarm in China: ‘this could become a nightmare’ / SCMP (paywall)
“South Korea’s recent summit with Pacific island nations reflects its wider strategy of becoming a ‘global pivotal state’ with a more expansive role beyond East Asia, even as analysts warn that its apparent tilt towards the United States risks a collision with China.”
U.S. antimissile system in South Korea, a source of Chinese anger, cleared for full deployment / WSJ (paywall)
“A U.S. missile-defense system in South Korea that has enraged China got a clear path for a full deployment, as tensions flare up between the two countries.”

Pakistan
Pakistani Taliban’s ‘shadow province’ threatens China BRI projects / Nikkei Asia (paywall)
“The Pakistani Taliban’s new drive to control the country’s south threatens to be a ‘huge problem’ for reviving multibillion-dollar infrastructure projects under China’s Belt and Road Initiative (BRI), analysts say.”

Europe
Market barriers, tensions hinder European companies in China / Nikkei Asia (paywall)
“A growing number of European companies operating in China find doing business there more difficult, according to a study by the European Chamber of Commerce in China, as a result of higher barriers to market access and rising tensions between Beijing and Washington.”

SOCIETY AND CULTURE:

Chinese diaspora
Family history mirrors attitudes among China’s diaspora / Nikkei Asia (paywall)
“As China began to grow rapidly from the 1980s onward, following normalization of relations with the West, shame about the old country — once seen as backward and in need of modernization — was replaced by pride among Chinese Indonesians.”

Social media
China’s banned online communities have found a new home on Reddit / Rest of World
“They are drawn to the platform’s community-moderated, discussion-based format, which allows for more fringe voices to thrive.”