China News - 9 May 2022
Event this week: China's Energy Security. China has many reasons to worry about energy security. What does Beijing’s energy strategy look like and how is it impacting geopolitics? Join Tom Tugendhat MP, Helen Thompson, Dr Michal Meidan and Lara Dong this Wednesday 11 May at 10:30am. Register here.
International
Nuclear plant under threat amid ‘political opposition’ to Chinese backing, EDF warns. French energy giant EDF has told investors it has no obligation to keep funding the project in Bradwell, Essex, and that there is now “great uncertainty” over whether it can be delivered. EDF and Chinese state-owned power company CGN own 33.5% and 66.5% of the Bradwell project respectively. EDF also warned it may have to finance billions in extra funding for Hinkley Point C, Britain’s first new nuclear plant in three decades, if China refuses to participate in an investment round planned for 2023. The Telegraph, 8 May
Beijing-backed hardliner John Lee chosen as Hong Kong’s next leader.
Lee, a former security minister and policeman, received 1,416 votes on Sunday from the 1,461-member “patriots only” selection committee, which is mostly comprised of pro-Beijing politicians and businesspeople and represents 0.02% of the city’s 7.4 million population. Josep Borrell, the European Union’s top diplomat, said that the election in Hong Kong was “yet another step in the dismantling of the ‘one country, two systems’ principle.” FT, BBC, 8 May
Chinese tech giants quietly retreat from doing business with Russia. Chinese tech companies are quietly pulling back from doing business in Russia under pressure from sanctions and suppliers, despite calls by Beijing for companies to resist overseas coercion. Several major companies are curtailing shipments in Russia, where Chinese tech firms dominate the market for many products, without making any public announcements, according to Wall Street Journal sources. WSJ, 6 May
Chinese calculations on Taiwan affected by Ukraine conflict, says CIA director. The director of the CIA said that Chinese president Xi Jinping has been “unsettled” by the war in Ukraine, which demonstrated that the friendship between Beijing and Moscow had “limits” at a time when western allies were moving closer together. Reuters, 7 May
Taiwan and US consider weapons suited to defend against China. The Biden administration’s push for Taiwan to order missiles and smaller arms for asymmetric warfare has gained urgency since Russia’s invasion of Ukraine. China’s People’s Liberation Army said on Monday it carried out another round of military exercises near Taiwan last week. NYT, 7 May
Covid: symptomatic cases in Shanghai climb 50 per cent as ‘static management’ curbs put in place. Meanwhile, Beijing city authorities urges residents of capital’s commercial centre, Chaoyang, not to leave unless absolutely necessary. SCMP, 9 May
Chinese vice-president on rare trip abroad to win over South Korean leader. SCMP, 8 May
Asian Games in China postponed because of Covid-19. BBC, 7 May
Economy & tech
China’s stringent Covid policy hits yuan and equity markets. The yuan fell to its lowest point in more than a year on Friday as the Chinese government’s pledge to double down on its zero-Covid policy and expectations of more interest rate increases raised concerns of a further slowdown in economic growth. The Times, 7 May
US and Chinese accounting regulators discuss potential audit deal. A deal that would allow officials from the US Public Company Accounting Oversight Board access to audits of Chinese companies could help resolve a stand-off between Washington and Beijing and prevent about 270 Chinese firms from being delisted by New York exchanges. FT, 6 May
Xiaomi accuses Indian agency of 'physical violence' threats during probe. Chinese smartphone maker Xiaomi has alleged its top executives faced threats of "physical violence" and coercion during questioning by India's financial crime fighting agency, according to a court filing seen by Reuters. Reuters, 7 May
China trade: export growth slowed to lowest level in almost 2 years in April, imports flat. SCMP, 9 May
China floods credit into industrial and infrastructure sectors. Caixin, 7 May
China focus
China orders government, state firms to dump foreign computers. Central government agencies and state-backed corporations are to replace foreign-branded personal computers with domestic alternatives within two years, marking one of Beijing’s most aggressive efforts so far to eradicate key overseas technology from within its most sensitive organs. Bloomberg, 6 May
Employment: Premier Li Keqiang warns of ‘complicated, grim’ outlook. Li urged provincial governments to take stronger action to stabilise employment ahead of the landmark 20th Party Congress this year. SCMP, 8 May
Opinion & editorial
Lex in depth: why the luxury market needs to hedge against China. A shift in spending habits in Asia and a crackdown on wealth by Beijing threaten a profit squeeze for high-end brands. FT, 8 May
Controversy over China's new embassy in London reflects growing tensions with the West. Charlie Campbell. TIME, 3 May
Nothing can stop China's relentless rise. While the West is working out how to pay for lockdowns, China will be roaring again. Matthew Lynn. The Telegraph, 6 May
Three scenarios for the South China Sea: the good, the bad and the ugly. Mark J. Valencia. SCMP, 9 May
Long reads
Britain's biggest bank is caught in the US-China crossfire. The tussle points to the difficulty of doing business in China. Bloomberg, 8 May
Eventually, China’s borders will reopen. Will foreigners return? The pandemic interrupted immigration reforms and drove away many expat workers. Qian Junya. Sixth Tone, 7 May
Once a zero-Covid poster child, Taiwan learns to live with the virus. Helen Davidson. The Guardian, 9 May
Inside TikTok, Zhang Yiming's great voyage through the waves. Jiang Jiang. Ginger River Review, 4 May