China’s Belt and Road: Coming soon to a theater near you – China news from May 12, 2017

A roundup of today’s top China news. Get this free daily digest delivered to your inbox by signing up at supchina.com/subscribe.

The editors

A movie trailer for Xi Jinping’s signature policy

At The China Project, we’ve been calling China’s project to connect Asia and Europe — One Belt, One Road (OBOR) — the signature initiative of Xi Jinping. On May 12, Xinhua News Agency released a video (in Chinese with English subtitles) that confirms that Xi is very much the main man whose signature is all over the development plan. The six minute video is a little like a movie trailer and uses computer generated animations of soaring eagles, camels, and ships, mixed up with live action footage, and odd digital mash-ups — like the giant man in the costume-party Greek toga, fishing at the port of Piraeus, in the screenshot above. The voiced-over narration by the Chinese president starts like this:

While visiting Kazakhstan and Indonesia in 2013, I proposed jointly building the Silk Road Economic Belt and the 21st Century Maritime Silk Road respectively.

Shaanxi, my home province, is situated at the starting point of the ancient Silk Road.  Standing here and looking back on history, I feel I can hear the sound of camel bells ringing in the mountain, and see plumes of smoke rising over the desert. This all feels so familiar. 

Then the viewer sees images of humanitarian disasters, such as the photo of the three-year Syrian refugee Alan Kurdi, whose body was found washed up on a beach, together with captions like “War” and “Wealth gap.” Then Xi Jinping’s voice-over asks, “What has become of the world? What should we do?”

The answer, of course, is OBOR. “History,” Xi exhorts us, “is made by the brave.”

Other OBOR news:

  • “The United States will send a delegation led by White House adviser Matt Pottinger to a summit for China’s new Silk Road plan this weekend, China’s Foreign Ministry said on Friday,” according to Reuters; see story on U.S.-China trade deal below for more on this.
  • Reuters also notes that “South Korea has accepted a last-minute invitation from China to a conference on a new Silk Road, days after a new president took office on Seoul pledging to engage in discussions with Beijing to ease tension over a U.S. anti-missile system.”
  • The South China Morning Post reports that “European diplomats confess they don’t know much about Xi’s trade plan” in a story titled “We’re still figuring out China’s Belt and Road.”
  • The South China Morning Post says that Nepal has signed an agreement to be part of OBOR, “a move that could alarm India, which jostles with China for influence in Kathmandu.”
  • The Guardian tells the tale of a 45-year-old man from Xi’an who has opened “a garish roadside spa” for Chinese tourists visiting the Karakoram Highway in Xinjiang, “part of a wave of entrepreneurs now pouring into this isolated frontier near Pakistan, Afghanistan and Tajikistan, hoping to cash in on President Xi’s Belt and Road initiative.”
  • There are doubts as to whether any of China’s partners in OBOR will actually pony up any cash. In a story headlined “Cash crunch on China’s new Silk Road,” the South China Morning Post quotes Hong Hao, chief strategist at Bocom International: “I’m not optimistic about ­other parties’ active participation… When they believe the initiative is mainly aimed at building up China’s sway, instead of providing profitable projects, few will be ­interested.”
  • Reuters says that “a Chinese official told local reporters on Friday to focus on the inclusiveness of China’s Belt and Road initiative and refrain from reporting the amount of Chinese investment in specific countries along the route.”
  • Beijing is in big event lockdown mode: Some factories and subway stations are closed through the weekend, and security is tight. The Beijinger has a roundup of the arrangements if you find yourself in the capital this weekend.

Brawl between employees of rival internet companies

A dinner event attended by employees of both Tencent and Youku, the online video service owned by Alibaba, ended in a brawl. According to one account, a Tencent staffer had bad-mouthed Youku, enraging a loyal Youku employee, who proceeded to smash a wineglass on his provoker. Caixin says that “the outburst has sparked much chatter on China’s social-media platforms and put a spotlight on tension between China’s leading video-streaming companies, which are vying to produce and purchase exclusive rights to the most popular shows of the season.”

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—Jeremy Goldkorn, Editor-in-Chief

The Caixin-Sinica Business Brief, episode 5

Hear Kaiser Kuo and Caixin editors narrate and discuss the week’s biggest China business stories. The fifth installment features stories on the U.S.-China trade deal, Alipay’s push into the U.S. market, a dispute over grain in Henan Province, plus conversations with Doug Young on China in Djibouti and Li Rongde 李荣德 on the hacking of hospital prescription data. Please send your feedback on this new product to sinica@thechinaproject.com.

Viral video Friday

Jia Guo has your weekly roundup of Chinese viral videos. Buzzing in China this week: a heroic rescue, a dancing noodle maker, and more.

This week on The China Project:

This week’s news roundups are:

This issue of the The China Project newsletter was produced by Sky Canaves, Lucas Niewenhuis, Jia Guo, and Jiayun Feng. More China stories worth your time are curated below, with the most important ones at the top of each section.

The China Project’s conference in New York on May 18 will feature 20 women leaders in Chinese technology, business, and culture. Buy your tickets here.

BUSINESS AND TECHNOLOGY:

U.S.-China trade deal: A ‘herculean accomplishment’ or ‘not a breakthrough’?

On May 11, U.S. Commerce Secretary Wilbur Ross announced that America and China, in the midst of their “100-day” negotiating period, had reached agreements on 10 items in trade between the two countries, Bloomberg reports. Many of the agreements are preliminary and not binding, and some — including on the export of U.S. beef to China and on U.S. payments companies operating in China — had already been agreed, but not implemented, in years prior. Ross hailed the deal as a “herculean accomplishment,” but the chairman of the U.S. Chamber of Commerce in Shanghai dismissed the deal as “not a breakthrough.”

Other items agreed upon, according to the joint statement, include:

  • That China would open itself to imports of U.S. beef “no later than July 16, 2017,” and the U.S. would “publish a proposed rule by July 16” to open itself to imports of Chinese cooked poultry “as soon as possible.”
  • That “the United States welcomes China…to receive imports of [liquefied natural gas] from the United States.”
  • That China will “conduct science-based evaluations of all eight pending U.S. biotechnology product applications,” including bioengineered seeds.
  • That China will allow U.S. electronic payment services “full and prompt market access” in the country, through further guidelines issued by July 16 if necessary.
  • That the U.S. “recognizes the importance of China’s One Belt and One Road initiative,” and, as mentioned in a separate Reuters report, will send White House adviser Matt Pottinger to Beijing for its OBOR conference.

What comes next? Further negotiations will inevitably focus on issues tougher to resolve than the low-hanging fruit picked in this first round. In addition, the U.S. just confirmed that the next U.S. trade representative will be Robert Lighthizer, who was nominated in January and praised by respected China businessman James McGregor in February, and is noted for pushing very aggressive tactics on China and blaming the country for a “U.S. manufacturing crisis.”

POLITICS AND CURRENT AFFAIRS:

Drug price controls go nationwide, and Beijing helps hospitals compensate

Caixin reports that “the central government will dole out 20 million yuan ($2.9 million) to each of 338 cities to launch pilot reform programs at their respective public hospitals” — this will offset the losses caused by healthcare reforms that will ban hospitals from marking up drug prices. Last month, the Beijing government became the first in the country to ban the 15 to 20 percent markups common on drugs sold in Chinese hospitals, and the National Health and Family Planning Commission (NHFPC) plans to enforce a similar ban nationwide by September of this year. Caixin notes that the offset program is only on a trial basis, and a NHFPC spokesperson “did not say how long the trial program — and the government funding — will last.”

SOCIETY AND CULTURE:

In Beijing, all lights on for the OBOR summit

As of May 11, Beijing has initiated an eight-day landscape lighting extravaganza to celebrate the upcoming One Belt, One Road (OBOR) summit, the Beijing News reports (in Chinese).

Beijing strictly controls the level of street lighting in the city, and divides the operation of the city’s lighting system into three levels: ordinary days, festivals, and important festivals. National holidays such as Spring Festival and National Day, as well as special events such as the 70th anniversary of the victory of the Anti-Japanese War and the OBOR summit that will take place in Beijing on May 14 and 15, fall into the last category. On the highest lighting level, all-night scenery lights across the city will be on from 7:30 p.m. to midnight. For this duration, the newly installed 2,290-square-meter net of lights and 10,860 reed lamps surrounding the National Grand Theater of China have been put into use.

A brightly illuminated Beijing, however, doesn’t come without a price. Although most comments on the news were censored, a post by a internet user on the social media platform Weibo suggests that Beijing has restricted the use of electricity in several areas. Many hotels were ordered to switch off central air-conditioning. “Phone signals have been quite weak recently, probably because some base stations were closed,” the user wrote (in Chinese).

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