China News - 18 October 2022
International
Ex-UK pilots lured to help Chinese military, MoD says. Up to 30 former UK military pilots are thought to have gone to train members of China's People's Liberation Army. The UK is issuing an intelligence alert to warn former military pilots against working for the Chinese military, with the National Security Bill - designed to address resilience against hostile state threats - going through the last stage of committee today. BBC, The Times, 18 October
Foreign Influence Registration Scheme to make clandestine political activity illegal. The Foreign Influence Registration Scheme (FIRS), introduced via an amendment to the National Security Bill, will compel those acting for a foreign power or entity to declare political influencing activity – and criminalise those who do not. Tom Tugendhat, Security Minister, said: “For years I have advocated for the establishment of a foreign influence registration scheme to deter foreign powers from pursuing their pernicious aims through the covert use of agents and proxies.” Gov.uk, 18 October
China’s plans to annex Taiwan moving ‘much faster’ under Xi, says Blinken. China’s government is pursuing its plans to annex Taiwan on a “much faster timeline” under Xi Jinping, the US secretary of state has said, reiterating warnings of global economic disruption if Taiwan was taken over. Blinken said peace and stability between China and Taiwan had been successfully maintained for decades, but Beijing had changed its approach. The Guardian, 18 October
20th Party Congress
Xi Jinping likely to pack party leadership with allies in show of strength. Chinese leader Xi Jinping is preparing to name loyalists to top positions in the Communist Party hierarchy, according to people close to party leaders, in a move that would strengthen his hand as he confronts mounting challenges at home and abroad. The Wall Street Journal reports that one of the allies Xi aims to promote is Li Qiang, currently the top party official in Shanghai. Li shouldered blame for a Covid-19 lockdown during which tens of millions of residents in the country’s financial centre struggled to access food and medical care. WSJ, 17 October
China delays release of key economic data amid party congress. China delayed the release of economic indicators scheduled for publication this week, including its third-quarter gross domestic product data due on Tuesday. Leading economists said the delay was unlikely to affect market sentiment as most preliminary economic data pointed to a pick-up in recovery in the third quarter. Reuters, 17 October
Xi sends supportive message to domestic IT, AI, and new energy sectors. SCMP, 17 October
Anti-Xi slogans in rare Beijing protest spread within China. Bloomberg, 18 October
UK police open probe into assault of protester inside Chinese consulate. Police have opened an investigation into the assault of a protester inside the Chinese consulate in Manchester at the weekend during a demonstration by Hong Kong pro-democracy campaigners. Greater Manchester police said in a statement on Monday that a “small group of men” had come out of the Chinese consulate and dragged one of the protesters back into the grounds and assaulted him. FT, 17 October
China competition eclipses all other EU relations with Beijing, top diplomat Josep Borrell says. Speaking after the EU’s 27 foreign ministers met in Luxembourg on Monday to discuss China for the first time this year, the EU’s top diplomat says the bloc now views economic and political competition with China as having eclipsed all other aspects of bilateral ties. SCMP, 17 October
No consensus yet on China joining CPTPP - Singapore PM. Reuters, 18 October
India surpasses China in sending students to the US. Nikkei Asia, 17 October
Economy & tech
China's state banks seen acquiring dollars in swaps market to stabilise yuan.
Traders in China said large state-run banks were swapping renminbi for US dollars in the country’s forwards market, then selling the dollars in the country’s onshore markets in an intervention to bolster the domestic currency. The Chinese currency has fallen almost 12 per cent against the dollar this year, with weakness becoming more pronounced after regulators relaxed informal foreign exchange trading limits in late September. FT, 17 October
China halts LNG sales to foreign buyers to ensure own supply. The National Development and Reform Commission, the nation’s top economic planner, told its state-owned gas importers to stop reselling LNG to energy-starved buyers in Europe and Asia in order to ensure its own supply for the winter heating season. Bloomberg, 18 October
BYD rolls into Europe's EV scene to take on VW and Tesla. China's BYD, second only to Tesla in global sales of electric vehicles, announced the launch of three EVs in the European market at the first Paris Motor Show in four years. By bringing its products and innovation to Europe, the company aims to become the "global leader" in EVs, said Michael Shu, managing director of BYD Europe. Nikkei Asia, 17 October
Flying to China in economy class will cost you $5,000. WSJ, 17 October
Long reads & opinion
How Xi came to dominate China. Richard Lloyd Parry. The Times, 17 October
Xi Jinping’s ideological ambition darkens China’s economic prospects. Lingling Wei. WSJ, 17 October
Consulate attack in UK reflects China’s aggressive foreign policy, analysts say. Assault on protester in Manchester is seen as being consistent with Beijing’s hawkish rhetoric of recent years. Verna Yu. The Guardian, 17 October
Apple/China: suspending plan to use Yangtze chips means more local tech problems. The Chinese company’s flash memory card for iPhones offered one of the few export hopes for suppliers. Lex. FT, 17 October