A barrel of vinegar and a thimble of honey for Taiwan

• Yesterday, the Central Committee of the Communist Party of China (CPC) and the State Council jointly issued a planning document (original text and English translation) for turning parts of Fujian Province — situated on China’s southeast coast opposite Taiwan — into a demonstration zone for “integrated development” with Taiwan.
• This concept elaborates on a previous plan mentioned in China’s 14th Five-Year Plan (2021—2025), and contains 21 specific points for expanding social, cultural, and economic ties between Taiwan and Fujian, and a commitment to create a more “relaxed” policy environment facilitating the flow of people from Taiwan to Fujian.
• The geographic focus of the plan is Pingtan Island, just off the coast near Fujian’s capital city Fuzhou — and its “68 Nautical Mile Scenic Spot,” named for its distance from Taiwan.

At the same time, China’s naval forces this week carried out their largest-ever military exercises around Taiwan.

• Taiwan’s defense ministry tracked around 35 Chinese warplanes around the island, and a Taiwanese warship monitored China’s Shandong aircraft carrier as it passed 60 nautical miles from Taiwan’s coastline.

The sticks are not just military: Yesterday, China’s Taiwan Affairs Office issued a further economic threat to Taiwan to suspend tariff preferences granted to Taiwanese goods.

• This would be the latest such sanction, coming after more than two years of restrictions on Taiwanese pineapples, wax and custard apples, seafood products, snacks, and alcohol brands.
• So it’s unsurprising that a Taiwanese lawmaker from the ruling Democratic Progressive Party (DPP) described China’s new plan as “ridiculous.”

Click through for all the details.

Barry van Wyk

The European Union has launched a probe into Chinese subsidies for electric vehicles (EVs) for “distorting” the EU market, as European carmakers fret over China’s competitive edge in developing cheaper, more consumer-friendly models.

“Global markets are now flooded with cheaper Chinese electric cars,” European Commission President Ursula von der Leyen said in her annual address to the European Parliament today. She earlier raised concerns over China’s EV trade practices to Chinese Premier Lǐ Qiáng 李强 on the sidelines of the G20 summit in New Delhi last weekend.

Chinese state-backed nationalist tabloid Global Times yesterday published a commentary stating that any restrictions placed by the U.S. and EU on China’s EV industry would put them at an “obvious disadvantage.”

China has become the first country to send an ambassador to Afghanistan since the Taliban took over, at least according to the Taliban’s Foreign Ministry, which says Zhao Sheng, the new Chinese ambassador, presented his credentials to Taliban Prime Minister Mullah Hassan Akhund in Kabul today. No country to date has officially recognized the Taliban’s government since the group grabbed power in the wake of the U.S. withdrawal in August 2021.

However China’s Foreign Ministry has made no such announcement. Yesterday, it issued a press release about its “Special Envoy for Afghanistan Affairs,” Yuè Xiǎoyǒng 岳晓勇, visiting Pakistan, Qatar, and Saudi Arabia, and on September 2, the ministry reported that the Charge d’affaires for its embassy in Afghanistan, Zhào Hǎihán 赵海涵, had published a signed article in the Afghan media on the Belt and Road Initiative.

Update: The Chinese Foreign Ministry confirmed that Zhào Xīng 赵星 is the new ambassador (大使).

Thailand will offer visa-free entry to tourists from China and Kazakhstan during the peak holiday season from September 25 to February 29. The temporary waiver is expected to attract 5 million additional visitors, according to Thailand’s Tourism Minister Sudawan Wangsuphakijkosol, as part of the country’s plan to boost its big tourism industry back to pre-COVID levels.

Hong Kong logged 4.1 million visitors in August, a 14% increase from July and hitting 84% of the pre-pandemic levels, the city’s Tourism Board announced today. That brought the total number of Hong Kong tourists to 20.6 million from January to August this year, including 16.5 million from mainland China, as the finance hub tries to lure back visitors after axing its stringent COVID curbs late last year.

Authorities in southern China are on the hunt for 70 escaped crocodiles that have been let loose by the torrential floods caused in the wake of Typhoon Haikui. The animals had escaped from a nearby farm into surrounding lakes and ponds in Maoming, about 340 kilometers (210 miles) southwest of Hong Kong. Local officials have warned villagers to stay alert and have launched an operation to retrieve the crocodiles. Some have reportedly been shot or electrocuted.

Chinese state media: Party paper the People’s Daily features the whole text of the new Taiwan integration plan that is the subject of our top story today. Xinhua News Agency leads with a report on Xí Jìnpíng 习近平 meeting visiting Venezuelan President Nicolás Maduro in Beijing today.

• Steel plants emit about 1.8 billion tons of carbon per year, second only to thermal power plants, which release more than 7 billion tons annually.
• Hydrogen could be used as a substitute for coke in the traditional steelmaking process, but this would only reduce emissions if steel plants used “green hydrogen,” made by splitting water into hydrogen and oxygen using an electrochemical cell called an electrolyzer, as opposed to “gray hydrogen,” which is made by burning coal and natural gas

China is the world’s largest producer of hydrogen, but most of it is gray.

• The U.S. and the EU have set generous subsidies for green hydrogen production. China’s central government has set goals too, but much less ambitious ones, which are not comparable to the early days of the electric vehicle battery market when targeted subsidies for battery makers such as CATL created industry leaders.

Nonetheless, local governments, solar energy companies, state oil giant Sinopec and other actors are investing in green hydrogen: This is your guide to the state of the industry.

Huiling Zhou

• “We’re at that phase when the community has expanded quickly, but it’s not yet at the level where responsible behavior is the norm,” said veteran Beijing-based birder Terry Townshend. “Some elements of the photography community are putting pressure on wildlife.”

But local authorities have been responsive to distress calls. In an eastern suburb of Beijing in the summer of 2022, up to 100 photographers were staked out trying to get a glimpse of the oriental scops owl.

• People complained online, leading local authorities to fence off its nest, letting the micro-owl breed in relative peace.

And there is a plan, launched in 2018, to gain world heritage status for sites up and down China’s coast. Phase two, extending to another dozen places, will be rolled out from next year.

Heather Mowbray

• Lín Biāo 林彪 was a principal architect of the cult of Máo Zédōng 毛泽东. But by the summer of 1971, Mao was publicly identifying Lin as someone who had committed political errors, and seemed on the verge of removing him from power. Lin’s dramatic fall is the subject of James Carter’s latest This Week in China’s History.

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

BUSINESS AND TECHNOLOGY:

A new radar chip?
Amid U.S. tech sanctions, Chinese scientists say they made the world’s most powerful radar chip / SCMP (paywall)
“A research team with a major Chinese defense company says it has built a radar chip with a record power output using semiconductor technology that is the subject of strict U.S. sanctions.”

German satellite company curb
Berlin blocks complete takeover of satellite startup by Chinese firm / Reuters
“The German government on Wednesday forbid the complete takeover of satellite startup KLEO Connect by a Chinese firm, two government sources told Reuters.”

China’s banks are lending more
Expect China’s credit growth to pick up further / Caixin (paywall)
“China’s outstanding total social financing (TSF) grew 9% year-on-year at the end of August, faster than 8.9% a month earlier, thanks to more bank loans and bond issuance, as well as a low base for comparison.”

Electric vehicles
France welcomes EU probe into Chinese electric vehicles — minister / Reuters
“French Europe Minister Laurence Boon on Wednesday welcomed an anti-subsidy investigation into Chinese electric vehicles launched by the EU Commission, saying it was important to protect the bloc’s market.”
EU to investigate ‘floods’ of cheap Chinese electric vehicles, sparking fears of trade war / SCMP (paywall)
EU to launch anti-subsidy probe into Chinese electric vehicles / FT (paywall)
EU’s Von der Leyen announces China EV anti-subsidy probe / Nikkei Asia (paywall)
European Union will investigate Chinese subsidies of electric cars / NYT (paywall)
U.S., Europe need China EV batteries to help own firms / Global Times
EU escalates China tensions with probe to ward off cheap EVs / Bloomberg (paywall)
China’s mid-tier cities vie for EV battery supremacy / Caixin (paywall)
“China’s city governments have been bending over backwards to court firms…as they seek new sources of economic and jobs growth amid a general slump.”

iPhone in China
Chinese consumers cheer Apple’s iPhone 15, others prefer Huawei / Reuters
“Apple’s iPhone 15 drew mixed reactions in its third largest market of China on Wednesday, with many online users liking its faster chip and improved gaming capabilities while others preferred Huawei’s new smartphone.”
Chinese titanium producers expect boost from new iPhone / Reuters
“China’s titanium producers said on Wednesday they expect stronger demand for the lightweight metal after the launch of a new model of Apple’s iPhone with a titanium shell.”
China warns over reports of iPhone-related ‘security incidents’ / FT (paywall)
“China warned it has ‘noticed reports’ of iPhone-related ‘security incidents’ and told smartphone makers to comply with the law in its first official comments following news that government bodies are cracking down on the use of the US company’s devices.”
iPhone 15 faces China headwinds but not from Beijing or Huawei / Nikkei Asia (paywall)
“At first glance, Apple appears to be facing a rocky future in China: Onetime rival Huawei released two 5G-powered handsets just days ahead of the latest iPhone launch, while Beijing is clamping down on the use of foreign phones by government workers.”
China denies banning iPhones, but cites unspecified security concerns / NYT (paywall)
China flags ‘security incidents’ with iPhones as bans expand / Bloomberg (paywall)

Real estate and property development
China rule changes may help property market, not wider economy / Nikkei Asia (paywall)
“China’s recent policy measures aimed at stabilizing the property sector will likely generate demand, but not enough to boost growth in the real economy, according to analysts.”

Alibaba
Jack Ma still Alibaba’s ‘biggest boss’ as Daniel Zhang leaves cloud unit / Nikkei Asia (paywall)
“The surprise resignation of Daniel Zhang [張勇 Zhāng Yǒng] as head of Alibaba’s key cloud unit has thrown a spotlight on the continuing influence of Jack Ma [马云 Mǎ Yún] over the company he helped found and led for over two decades.”

SCIENCE, HEALTH, AND ENVIRONMENT:

China struggles to meet energy-saving expectations
China ups pressure on some provinces as energy-saving efforts fall short / Caixin (paywall)
“China has warned four provinces to pick up the pace in achieving their central government-set energy-saving targets by 2025, as slow progress has seen them falling behind other provinces in controlling the use of energy, according to a statement from the country’s top economic planner.”

COVID-19 origin
Did the CIA bribe analysts to reject COVID-19 China lab-leak theory? Scientists have doubts / SCMP (paywall)
“A CIA whistle-blower’s claim that the US spy agency bribed some of its analysts to reject the Covid-19 lab-leak theory is unlikely and part of a politicized debate about the virus’ origins, according to top virologists.”

POLITICS AND FOREIGN AFFAIRS:

South China Sea

Opinion: China must end its diplomacy of coercion / Nikkei Asia (paywall)
The Nikkei editors write: “When ASEAN leaders and their peers met for summit meetings in Indonesia through Sept. 7, they once again voiced concern over China’s aggressive expansion efforts in the South China Sea. Beijing’s coercive actions aimed at strengthening its effective control of those waters have no legal legitimacy, yet it refuses to stop. China needs to understand that no show of force, no matter how strong, will ever win the trust of its neighbors.”

Criminal appeals
China seeks to get more criminal appeals cases their day in court / Caixin (paywall)
“China’s top judicial authorities are looking to ensure more criminal appeals cases are heard in court by establishing dedicated statutes and systems to better facilitate the process, amid growing public concern over low hearing rate.”

Hong Kong leadership
China’s Ding Xuexiang signals leading role in Communist Party’s revamped Hong Kong affairs body / SCMP (paywall)
“Dīng Xuēxiáng 丁薛祥, the sixth-ranked member of China’s ruling Communist Party, has signaled his leadership of the party’s top body for Hong Kong and Macau affairs with an address to a high-level forum hosted by the Hong Kong government.”

Chinese military drills around Taiwan
Shandong aircraft carrier, warplanes and navy ships skirt Taiwan coast on way to combat drills / SCMP (paywall)
“Taiwan has tracked at least 84 People’s Liberation Army warplanes and 33 warships in three days as the Shandong aircraft carrier conducts joint sea and air training in the western Pacific in what may be the biggest PLA drill in months.”

Vatican Ukraine envoy heads to China
China agrees to rare visit by Vatican envoy for Ukraine talks / Reuters
“The Chinese foreign ministry said on Wednesday that Vatican envoy Cardinal Matteo Zuppi will visit China for talks on resolving the conflict in Ukraine, despite the lack of formal bilateral relations between Beijing and the Holy See.”
Pope Francis’ Ukraine peace envoy Cardinal Zuppi set for 3-day visit to China / SCMP (paywall)

Laos
On the China-Laos border, a cautionary tale of hot money and wild dreams / Sixth Tone
“Chinese investors have poured money into the small Lao town of Boten, believing a new railway would bring massive growth. But the hoped-for boom has yet to arrive.”

U.K.’s troubled China ‘reset’
Rishi Sunak launched China reset despite alleged spy arrest / FT (paywall)
“Rishi Sunak learnt of the arrest of a parliamentary researcher accused of spying for China in a ‘timely fashion,’ but still pressed ahead with stepping up engagement with Beijing.”

Japan
China’s Fukushima blowback follows old Japan-bashing playbook / Nikkei Asia (paywall)
“The Chinese backlash against Japan’s release of treated wastewater from the Fukushima Daiichi nuclear plant shows no sign of ending.”

Afghanistan
Taliban say Chinese envoy appointed to Kabul in first ambassadorial appointment since takeover / Reuters
“ A new Chinese ambassador presented his credentials to the Taliban’s prime minister in Kabul on Wednesday, Afghan officials said, adding it was the first appointment of a foreign envoy at the ambassadorial level since the Taliban took power in 2021.”

Thailand
Chinese tourists get visa-free entry to Thailand in busy season / Bloomberg (paywall)
“Thailand will waive visa requirements for travelers from China and Kazakhstan in the busy holiday season as the tourism-reliant nation turns to the travel industry to prop up Southeast Asia’s second-largest economy.”

Venezuela
China, Venezuela upgrade ties to ‘all-weather strategic partnership’ -state media / Reuters
“China and Venezuela will elevate their ties to an ‘all weather strategic partnership,’ Chinese state media cited President Xí Jìnpíng 习近平 as saying in a meeting with Venezuela’s president on Wednesday.”
China upgrades relationship with Venezuela to ‘all weather’ partnership / AP
Xi says China, Venezuela agree on partnership during Maduro trip / Bloomberg (paywall)

SOCIETY AND CULTURE:

China’s full-time children
China’s ‘full-time children’ move back in with parents, take on chores as good jobs grow scarce / AP
“When she first moved to the Chinese tech hub of Shenzhen after graduating from college, Marguerite Wang imagined she would spend her career working hard in a big city. Instead, she’s living with her parents in her hometown in northeastern China.”

China’s gig workers and couriers
Half of China’s gig work seekers have undergrad degrees / Sixth Tone
“An analysis of job postings and résumé submissions on a leading jobs site has found that demand for ‘flexible employment’ such as delivery driving and livestreaming has increased even as supply of such jobs has fallen post-pandemic.”
From streets to pages: Inside the life of a Beijing courier / Sixth Tone
“In his latest book ‘Beijing Courier,’ Hu Anyan recounts challenges and heartwarming encounters from his days working as a courier that helped him discover the true value of life.”

Hong Kong tourism
Over 20 million visitor arrivals recorded for the first eight months of the year / Hong Kong Tourism Board

Crocodiles on the loose
Authorities vow to protect locals from runaway crocodiles after Haikui floods / China Daily
“Authorities in Pengcun village in Maonan district in Maoming city of Guangdong Province are considering shooting dead the crocodiles that have escaped from a nearby farm any time a local villager’s safety is threatened by the escaped ferocious animals.”
Hunt for nearly 70 crocodiles that escaped during China floods / The Guardian