U.S. lawmakers want to restrict sales of gene sequencing tech to China

• A recently proposed bill would require sellers to demonstrate that their products would not abet human rights abuses.
• U.S. Senator Marco Rubio (R-FL) introduced the legislation in the Senate in July, proposing a law that also would more closely control U.S.-made gene sequencing tech.

China’s annual DNA sequencing market was estimated to be valued at 18.3 billion yuan ($2.5 billion) in 2022.

• U.S. companies like Illumina, 10x Genomics, and Thermo Fisher Scientific are cashing in on that market.
• Tech made by some of those U.S. companies has been used by Chinese authorities in mass surveillance of ethnic minorities — an impetus for this legislation.

While not all sales of genetic tech to China will be banned if the bill passes, companies will incur higher costs and administrative burdens, regardless of the buyers, when selling some types of tech in China.

It’s a complex issue.

Eduardo Jaramillo

A new Huawei smartphone that uses technology that has found ways around U.S. sanctions also uses a chip made by South Korean firm SK Hynix, which responded: “SK Hynix no longer does business with Huawei since the introduction of the U.S. restrictions against the company and with regard to the issue, we started an investigation to find out more details.”

Australian Prime Minister Anthony Albanese will visit Beijing this year, he announced today after having “frank and constructive” talks with Chinese Premier Lǐ Qiáng 李强, Beijing’s second-in-command, on the sidelines of the ASEAN summit in Jakarta, Indonesia. If the visit goes as planned, Albanese will be the first Australian prime minister to visit China in seven years.

The face-to-face meeting in Jakarta between Albanese and Li took place as their two countries held their first High-Level Dialogue in three years in Beijing. The dialogues had taken place annually since 2014 but were suspended in 2020, after Beijing imposed sanctions on Australian imports in response to Canberra’s accusations of foreign interference in domestic politics and calls for an investigation into COVID origins that year.

China’s exports fell 8.8% in August compared with a year earlier, China’s General Administration of Customs (GAC) announced today. It marks the fourth consecutive month of decline, but at a slower pace than forecasts had predicted and less than the 14.5% drop in July, as the manufacturing sector in the world’s second-largest economy struggles with weak demand at home and overseas. Imports also fell 7.3% in August from a year earlier.

Meanwhile, Chinese foreign direct investment (FDI) in the U.S. plunged last year, with total completed transactions amounting $2.49 billion — less than half the amount in 2021 and the smallest since 2009, consulting firm Rhodium said in a new report released today.

U.S. House Speaker Kevin McCarthy called China’s stance on the Fukushima discharge “unfair” and “false” today during his visit to Japan. Tokyo has insisted that its decision to begin releasing treated radioactive water from its wrecked nuclear power plant is safe, despite strong criticisms from Beijing. Earlier that same day, Japanese Prime Minister Fumio Kishida said he explained Japan’s position on the matter to Li Qiang during their brief meeting on the sidelines of the ASEAN summit in Jakarta.

South Korean President Yoon Suk Yeol said that any attempts to change the status quo by force in the South China Sea “cannot be tolerated” and called to “establish a rules-based maritime order” in the region during the ASEAN summit, right before he had his own sidelines meeting with Li Qiang. On September 4, Yoon said in an interview with Indonesia’s Kompas newspaper that it was time for China and Japan to get their trilateral relationship “back on track.”

Vice Premier Liú Guózhōng 刘国中 will lead a delegation to North Korea tomorrow to attend the commemorative events for its 75th founding anniversary since the peninsula was freed from Japanese occupation and to tour the country, the Chinese Foreign Ministry announced today. In July, China had sent a group to Pyongyang for the anniversary of the end of the Korean War.

Popular Chinese social media app Weibo has banned 80 prominent crypto influencers for breaching regulations in China in areas such as marketing, internet safety, telecommunications, trade, and finance, the company said in a statement on September 6. In June, prominent finance writer Wú Xiǎobō 吴晓波 and two of his peers were banned from the Twitter-like platform for posting comments that “attacked and undermined” Chinese policy and spreading ​​“negative and harmful information.”

Zhengzhou, the capital of Henan Province, is offering subsidies to couples having children in a bid to boost China’s shrinking birth rate. The city plans to offer a one-time allowance of 2,000 yuan ($310) for families registering their first-born child. For couples having their second or third kid, the allowances increase up to 5,000 yuan (about $770) and 15,000 yuan (about $2,300), respectively.

Chinese state media: Xinhua News Agency leads with a short article on General Secretary Xí Jìnpíng 习近平 visiting a village and farmlands in rural Heilongjiang Province that were damaged by floods.

The People’s Daily print edition’s top story is a directive from Xi for Party members to “deliberately worship the people as our teachers.” There’s also a photo and short piece about Li Qiang attending the ASEAN summit.

• “The film is astonishing in its restraint, in the way it remains true to a ground-level view of what it looked and felt like to be on the verge of internment,” Darren Byler writes. “Nikah is a portrait of the impossible becoming reality.”
• All the actors in the film are non-professionals making their cinematic debut. “The fidelity they show to a life they knew before fleeing their homeland is what makes this film truly monumental,” Byler writes.

Nikahs are marriage ceremonies, during which a Muslim religious leader recites a Quranic blessing. During the time that this film is set — 2017 — the Chinese government was just about to enact a sweeping “anti-terrorism” law that targeted just such practices.

• Tens of thousands of Uyghurs and Kazakhs might have been detained for participating in such weddings.
• It didn’t stop there. According to a document published in 2017 by the Xinjiang Justice Ministry, the law also targeted female community leaders called the buwi. In Nikah, director Mijit portrays a buwi, perhaps sending a message about the futility of trying to silence Uyghur knowledge-bearers.

Click through to read this review by Darren Byler, part of his regular column about Xinjiang for The China Project.

The latest installment of the weekly Uyghur Bulletin is also out today. It’s an in-depth look at how China is breaking its own laws and ignoring international treaties as it keeps exiled Uyghurs in the dark about their detained relatives, who are denied due process, visits, and access to lawyers.

Darren Byler

That’s what executive and artistic director for Carolina Performing Arts, Allison Friedman told me when we chatted about the concert she is organizing on September 20 and 21 in Chapel Hill, North Carolina of the Philadelphia Orchestra on the 50th anniversary of their groundbreaking tour to China.

• The Philadelphia Orchestra’s September 1973 trip was one of the major events that led to rapprochement between the U.S. and China, culminating in the establishment of diplomatic relations on January 1, 1979.

What does Friedman hope comes out of this concert? “Given the rising tensions, anything that humanizes China is of vital importance right now. I hope that there’s an element of this that audiences take away.”

Click through for an edited transcript of our conversation.

Jeremy Goldkorn

• All the traditions lost after the Communists entered Beijing: The latest entry in Paul French’s Ultimate China Bookshelf is David Kidd’s Peking Story, one of the best accounts we have of the crucial interregnum period between the end of the Chinese Civil War and the consolidation of Communist rule.
• Sushi restaurants in China are searching for alternative supplies and, in some cases, new recipes after Beijing’s ban on Japanese seafood and amid rising animosity toward all things Japanese among Chinese diners, who are enraged by Japan’s decision to release contaminated water from the destroyed Fukushima nuclear plant into the ocean.

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

BUSINESS AND TECHNOLOGY:

Economic gloom or boom
Policymakers see darker days ahead in China as growth sputters / Reuters
“Policymakers expect persistently slower growth in China, perhaps even more sluggish than current consensus estimates, seeing its transition from an infrastructure- and investment-led economy to becoming consumption-driven as ‘difficult.’”
Does Beijing care that China’s economy is stagnating? / Nikkei Asia (paywall)
“China’s economic downturn reached a new milestone of sorts with the release last month of economic data for July. This showed consumer prices falling 0.3% from a year earlier, sparking worries that weak demand could begin to entrench deflationary expectations.”
The great Chinese flow reversal / FT (paywall)
“Back in the halcyon days of…a few years ago, one of the biggest global investment themes was how Chinese financial markets were becoming increasingly investible and attractive for international investors.”

Banking
China’s major banks to lower rates on existing first-home mortgages / Reuters
“Five of China’s major state banks said on Thursday they will start to lower interest rates on existing mortgages for first-home loans, part of a series of support measures announced by Beijing in recent weeks.”

Related, from last week: China takes aim at real estate crisis with new measures to boost economy / CNN

U.S.-China tech war
SK hynix opens probe into use of its chips in Huawei’s new phone / Korea Times
“SK hynix said Thursday it began an internal investigation into how its memory chips ended up in a new smartphone made by Huawei Technologies.”
Chinese breakthrough in gallium oxide semiconductor may deliver edge amid U.S. export ban / SCMP (paywall)
“Chinese scientists have achieved a breakthrough that could boost the country’s production of a new-generation semiconductor the U.S. has tried to ban from China because of its use in sectors such as defense and crucial infrastructure.”
U.S. lawmaker calls for end to all tech exports to Huawei, SMIC after chip breakthrough in new smartphone / SCMP (paywall)
“The U.S. Commerce Department should end all technology exports to Huawei Technologies and China’s top semiconductor firm following the discovery of new chips in Huawei phones that may violate trade restrictions, the chair of the House of Representatives’ committee on China said on Wednesday.”
Huawei phone is latest shot fired in the U.S.-China tech war / NYT (paywall)

China bans iPhone for state employees
China moves to widen state employee iPhone curbs -sources / Reuters
“China has in recent weeks widened existing curbs on the use of iPhones by state employees, telling staff at some central government agencies to stop using their Apple mobiles at work, two sources familiar with the matter said.”
Apple faces new challenge in China as Huawei releases high-speed phone / WSJ (paywall)
“With 5G-like speeds, the device creates buzz among Chinese fans after Beijing bans the use of iPhones at some government offices.”

Academic database fined for illegally collecting user’s data
China’s controversial academic database fined $6.8 million for illegal data collection / Sixth Tone
“A yearlong investigation by China’s internet watchdog has concluded that CNKI illegally collected users’ personal information.”

Automobile industry
China is flooding the world with cars / NYT (paywall)
“Even as China’s other exports falter, its carmakers are seeing big increases in overseas sales, mainly for gasoline-powered models.”

Rare earths
Chinese rare earth prices hit 20-month high on Myanmar supply worry / Reuters
“Chinese rare earth prices jumped to their highest in 20 months, as mining suspension in major producer Myanmar sparked stockpiling ahead of the peak consumption season, analysts said on Thursday.”

Country Garden
Default dodged, but Country Garden’s upcoming debt payments stir worries / Reuters
“Creditors of Country Garden Holdings are doubtful the Chinese developer will be in a position to service debt that will come due later this year without liquidity support, after it averted a catastrophic default this week at the last minute.”

Tencent
China’s Tencent debuts large language AI model, says open for enterprise use / Reuters
“Tencent Holdings said on Thursday companies could now use its large language artificial intelligence (AI) model ‘Hunyuan’ as it premiered the much-awaited product amid a race by tech firms race to become China’s AI champion.”
Tencent declares AI ‘war’ on Chinese rivals / FT (paywall)
“There are more than 130 large language models in China,” Tencent vice-president Jiǎng Jié 蒋杰 told a launch event in the southern city of Shenzhen. “A war of a hundred models has begun.”

SCIENCE, HEALTH, AND ENVIRONMENT:

Extreme weather
Southern China drenched, many flights canceled as rain storms pound region / Reuters
“The remnants of Typhoon Haikui drenched southern China for a third day since making landfall, and airports in Guangdong province canceled hundreds of flights due to stormy weather on Thursday though winds had weakened.”
Floods from Tropical Storm Haikui kill 2 and displace thousands in China’s Fujian province / AP
“At least two people have been killed and thousands forced to evacuate by floods brought by Tropical Storm Haikui in China’s southeastern coastal Fujian province, local authorities reported Wednesday.”

Renewable energy
China’s largest green hydrogen mega project hints at vast potential / Caixin (paywall)
“A mega solar-to-hydrogen factory has been commissioned in China, marking a milestone for the country’s — and potentially the world’s — effort to produce more green hydrogen, a fuel seen as key for slashing global greenhouse gas emissions.”

POLITICS AND FOREIGN AFFAIRS:

The Communist Party, elite politics, and government
China names veteran economic planner Yang Yinkai to Communist Party’s top financial policy body / SCMP (paywall)
Yáng Yinkǎi 杨荫凯, a “veteran state economic planner has been named to a key position in China’s ruling Communist Party’s top policy coordination body for finance and economic affairs in another career move that appears to mirror the trajectory of his boss Vice-Premier Hé Lìfēng 何立峰.”

Reactions against new repressive laws
Backlash in China against draft law banning items that harm ‘national spirit’ / Reuters
“Proposed changes to a Chinese public security law to criminalize comments, clothing or symbols that ‘undermine the spirit’ or ‘harm the feelings’ of the country have triggered the concern of legal experts, who say the amendments could be used arbitrarily.”
Public security penalty expansion risks ‘abuse of power,’ legal experts say / Caixin (paywall)
“China’s top legislature is seeking public comment on draft public security law revisions that expand the scope of punishment for a wide range of behaviors, including cheating on exams, organizing pyramid schemes and unauthorized drone flights.”

ASEAN
China Premier Li met Vietnam PM at ASEAN summit / Reuters
“China’s Premier Lǐ Qiáng 李强 met with Vietnamese Prime Minister Pham Minh Chinh on the sidelines of the ASEAN summit in Indonesia, the Chinese foreign ministry said on Thursday.”
South Korea’s Yoon meets China Premier Li at ASEAN summit / Reuters
“South Korean President Yoon Suk Yeol met with China’s Premier Li Qiang on the sidelines of an ASEAN summit in the Indonesian capital of Jakarta on Thursday, just hours after Yoon called for a rules-based maritime order in the South China Sea.”
China’s premier is on a charm offensive as ASEAN summit protests Beijing’s aggression at sea / AP
“In talks with Southeast Asian leaders Wednesday in the Indonesian capital, Chinese Premier Li Qiang underscored his country’s importance as the world’s second-biggest economy and as the top trading partner of the region.”
China wants an East Asia supply chain ‘matchmaking conference’ next year / Caixin (paywall)
“Premier Li Qiang has proposed a conference next year for East Asian economies to discuss further integrating regional supply chains to make them more efficient and resilient while leveraging their comparative advantages.”

Belt and Road Initiative
China says 90 countries have confirmed attendance for Belt and Road Initiative / Reuters
“China said on Thursday that 90 countries have confirmed attendance for its Belt and Road Initiative conference being held in October.”
China’s Belt and Road at crossroads as more loans turn sour / Nikkei Asia (paywall)
“A decade since China first proposed the Belt and Road Initiative, China’s aggressive investments around the world have helped expand both trade and its international influence.”

South China Sea
South China Sea row affects Philippine interests and is not solely a U.S.-China issue, Marcos Jnr says / SCMP (paywall)
“The Philippines, facing a new peak in tensions with Beijing over the South China Sea dispute, this week sought to emphasize to Asean counterparts that it viewed the row as a matter of core national interest, but observers say it was unlikely that the rest of the region would echo such rhetoric.”

North Korea
Chinese delegation led by vice premier to visit North Korea, state media says / Reuters
“A Chinese Communist Party and government delegation headed by Vice Premier Liú Guózhōng 刘国中 will visit North Korea to take part in the celebration of the country’s founding day later this week, state media KCNA reported on Thursday.”
Chinese Vice-Premier Liu Guozhong’s visit to North Korea this week is second Beijing delegation to Pyongyang in months / SCMP (paywall)

Japan
U.S.’s McCarthy says China’s stance on Fukushima discharge ‘unfair, ‘false’ / Reuters
“U.S. House of Representatives Speaker Kevin McCarthy called China’s position on the release of treated radioactive water from the Fukushima nuclear power plant ‘unfair’ and ‘false’ during a visit to Tokyo on Thursday.”

Australia
China, Australia hold first high-level dialogue in three years in Beijing / Reuters
“China poses no threat to Australia, and will not do so in future, Lǐ Zhàoxīng 李肇星, a former foreign minister, said on Thursday, as the two nations resumed a high-level dialogue track after a break of three years.”
Australia and China open their first high-level dialogue in 3 years in a sign of a slight thaw / AP
Australian PM to visit China soon as both sides hail progress / Reuters
“Australia and China have made progress in returning to ‘unimpeded trade’ and more is needed, Australian Prime Minister Anthony Albanese said on Thursday as he met Chinese Premier Li Qiang at a regional summit in Indonesia.”
Australian PM to visit China this year after ‘progress’ on ties / Nikkei Asia (paywall)

Italy
China keen to work with Italy on trade despite Belt and Road misgivings / Reuters
“China remains willing to work with Italy to improve trade and investment ties, the commerce ministry said on Thursday, even as the only Group of Seven power to join the Belt and Road Initiative (BRI) considers quitting the Beijing-led scheme.”

Africa
China, U.S. pledge millions in extra help for Africa at climate summit / SCMP (paywall)
“China will connect 50,000 poor African families using solar energy and provide satellites for early warnings of floods and drought, while the U.S. has promised another US$30 million to accelerate food security efforts across the continent.”

Laos
In a post-COVID Laos, China’s influence grows ever larger / Sixth Tone
“A new $5.5 billion railway is bringing a flood of Chinese investment to the Lao capital of Vientiane. After COVID-19, it’s desperately needed.”

SOCIETY AND CULTURE:

Feminism
China’s demure “good for marriage” trend sparks feminist furore / Reuters
“A fashion trend in China dubbed ‘good for marriage’ has generated a social media storm, with scores of women saying the demure, feminine style plays to gender stereotypes and discourages financial independence.”

How a Tiananmen survivor made billions
No other investor has a life story quite as unbelievable as Li Lu / FT (paywall)

Lǐ Lù’s 李录 “background made him a unique figure in U.S. investment circles — the Chinese dissident who was making a fortune by adopting western capitalist values. The pivot from ‘freedom fighter to Manhattan yuppie’ as one newspaper put it, was bound to raise eyebrows.”

Hong Kong’s aging infrastructure
Hong Kong’s crumbling old flat tenants left in the lurch as developers and authorities go slow during property downturn / SCMP (paywall)
“Some of the old and decaying blocks in Hong Kong’s To Kwa Wan district are so run-down that residents find it tough to find tradesmen to do repairs.”

Elderly thrill seekers
Tianjin’s ‘diving grandpas’ / Caixin (paywall)
“The group of internet-famous aging divers, who made Tianjin’s Shizilin Bridge their stage for the sport, have called it quits due to growing concerns about public safety.”

Music
Famous Taiwan rapper admits plagiarizing comic about depression / Sixth Tone
“The 2004 comic ‘Jumping Off a Building’ depicts a suicidal woman witnessing the sad lives of her neighbors as she falls to her death. MC HotDog, a famous Taiwanese rapper, has just admitted using the storyline in his new song without authorization.”