China News - 25 May 2023
International
Five Eyes intelligence network warn of Chinese state-sponsored cyber-espionage campaign. A joint statement by the US, Australia, Canada, New Zealand and the UK highlights a recently discovered cluster of activity associated with a Chinese state-sponsored cyber actor, known as Volt Typhoon. In a separate statement, Microsoft said Volt Typhoon had been active since mid-2021 and had targeted critical infrastructure in Guam, a crucial US military outpost in the Pacific Ocean. The Guardian, 25 May
US State Department's top China policy official to step down. Rick Waters is the deputy assistant Secretary of State for China and Taiwan and leads the department's recently created China House (officially the Office of China Coordination). He will leave his role on June 23, but is set to remain a member of the senior foreign service. Michael Martina and Humeyra Pamuk. Reuters, 24 May
US House panel on countering China urges actions on Xinjiang and Taiwan. House select committee issues its first set of policy recommendations, addressing the ‘ongoing genocide’ of Uyghurs and deterring Beijing from cross-strait attacks. Bochen Han. South China Morning Post, 25 May
China said to be negotiating arms deals with Saudi Arabia and Egypt. Saudi Arabian Military Industries (SAMI) is reportedly in talks with Norinco, a Chinese state-owned defence company, to buy weapons ranging from reconnaissance drones to air defence systems, according to Tactical Report, a Beirut-based intelligence service. Jane Cai. South China Morning Post, 24 May
China says NATO's plan for Japan office not welcomed in Asia-Pacific. Chinese foreign ministry spokesperson Mao Ning called on Japan to be ‘extra cautious on the issue of military security’ given its ‘history of aggression’. Japanese Prime Minister Fumio Kishida has reaffirmed the country has no plans to become a NATO member, despite plans to host an office in Tokyo. Reuters, 24 May
Hongkongers opt out of organ registry ‘amid fear of Chinese donations’. Thousands of Hongkongers have opted out of the city’s organ donor registry, seemingly as a form of subtle protest against proposals to establish deeper medical ties with mainland China. Amy Hawkins. The Guardian, 23 May
Economy & tech
TikTok CEO Says Oracle Has Begun Reviewing Its Source Code. TikTok CEO Shou Zi Chew said the American software company has begun a review of TikTok’s source code and Oracle is now the default destination for US user data. Zheping Huang and Caroline Hyde. Bloomberg, 23 May
Chinese companies switch auditors to avoid US delisting risk. More than a dozen US-listed Chinese companies have switched from auditors in their home country to ones in the US and Singapore since 2022. The move is prompted by the US’ Holding Foreign Companies Accountable Act (HFCAA), which rules that Chinese companies can be delisted if their auditors fail to comply with US accounting standards. Echo Wong and Kenji Kewase. Financial Times, 24 May
Kunming denies market rumours that local government financing vehicles are struggling. Ratings agencies have downgraded their outlook for many of the city’s LGFVs since the start of this year. The city’s state-owned assets manager has condemned ‘false information’ being disseminated online, and says legal action is being taken to protect Kunming’s reputation. Chen Yikan. Yicai Global, 24 May
Cayman Islands to set up an office in Hong Kong or Singapore in response to growing competition. Financial services minister André Ebanks has accelerated plans to establish a Cayman Islands government office in Asia after Singapore and Hong Kong approved new fund structures that offer international investors a way to shelter money in lightly taxed vehicles. Kaye Wiggins, Mercedes Ruehl and Leo Lewis. Financial Times, 25 May
South Korea warns US could ‘overburden’ its chipmakers with China limits. South Korea has called on Washington to review its conditions for new semiconductor subsidies, revealing its concerns over the impact of the Chips and Science Act on Korean chipmakers’ operations in China. Song Jung-a. Financial Times, 24 May
China overtakes US in contributions to nature and science journals. Citations of Chinese research have risen because of sequencing of Covid-19 genome. Amy Hawkins. The Guardian, 24 May
Opinion & long-reads
Driver’s Licenses, Addresses, Photos: Inside How TikTok Shares User Data. Exposing concerns over TikTok user data shared on Lark, ByteDance’s internal messaging and collaboration tool. Sapna Maheshwari and Ryan Mac. New York Times, 24 May
China Can’t Afford Xi’s Quest for Security. The Chinese leader is betting his nation can absorb a hit to economic growth and still close the gap with the US. Minxin Pei. Bloomberg, 24 May
Power of Siberia: China keeps Putin waiting on gas pipeline. Russia has still not secured a clear commitment from Beijing on Power of Siberia 2, a proposed Sino-Russian gas pipeline through Mongolia. Anastasia Stognei, Joe Leahy and Yuan Yang. Financial Times, 25 May
The Chinese youth unemployment phenomenon. Key takeaways from a new Goldman Sachs report examining the causes of China’s rising youth unemployment rate. Robin Wigglesworth. Financial Times, 24 May
Dissing China’s Recovery Is the New Black. Disillusion has replaced the high hopes that accompanied China’s reopening. Daniel Moss. Bloomberg, 23 May