China News - 9 May 2023
International
Chinese vice-president Han Zheng meets with Foreign Secretary James Cleverly during coronation trip. Cleverly claims to have voiced the UK’s concerns regarding Hong Kong, Taiwan and Xinjiang during their discussion. Reports suggest Han informally suggested Cleverly should visit China, though no formal invitation has been issued. Financial Times, 5 May
China ready to work with Britain, says Xi Jinping. The Chinese President and his wife Madame Peng Liyuan sent a congratulatory message King Charles III and Queen Camilla on their coronation:
‘The Chinese side is ready to work with Britain to enhance friendship of the two peoples, expand mutually beneficial cooperation, and deepen people-to-people and cultural exchanges, so as to bring more benefits to the two countries and the wider world with a stable and mutually beneficial China-Britain relationship.’ Xinhua News, 6 May
First UK ministerial trip to Hong Kong since 2018. Investment minister Lord Dominic Johnson has travelled to discuss boosting trade in fintech and financial services with Hong Kong government representatives. Johnson has stressed that he will also speak out against limiting Hong Kongers’ freedoms and ‘hold China to their international obligations’. Nevertheless, the visit has been heavily criticised by Conservative MPs and Lord Chris Patten, the last British governor of Hong Kong. Sophie Wingate. The Independent, 7 May
Investment minister meets with Hong Kong owner of Three mobile network as merger talks near close. During his visit to Hong Kong, Dominic Johnson has also met with senior executives at CK Hutchison. The proposed merger of Vodafone & Three, which would create the UK’s biggest mobile operator, is set for substantial regulatory scrutiny. Twitter, 8 May
Labour criticised for allowing HSBC staffer into shadow business team, amidst China links. A senior policy manager from HSBC has been seconded to the team of Jonathan Reynolds, the shadow business secretary, and has been given a parliamentary pass since February. The secondment was not declared on his MPs’ register of interests because the HSBC employee’s time is understood to be a donation in kind to the party, rather than him personally. Rowena Mason. The Guardian, 7 May
Canada and China expel diplomats in foreign influence dispute. Canada has expelled Chinese diplomat Zhao Wei after an intelligence report accused him of trying to intimidate a Canadian lawmaker, announced foreign minister Mélanie Joly yesterday. In response, China has today ordered the removal of Jennifer Lynn Lalonde, Canada’s consul in Shanghai. Chloe Kim and Kelly Ng. BBC News, 9 May
Brussels plans sanctions on seven Chinese companies supporting Russia’s war machine. The sanctions proposal from the European Commission has been drafted in light of the ‘key enabling role of electronic components for use by Russia’s military and industrial complex for supporting the war of aggression against Ukraine’. The sanctions list needs unanimous approval from the 27 member states before it can be enforced. Four of the companies listed have already been placed under sanctions by the US. Financial Times, 7 May
Chinese state security services raid multiple offices of international consultancy Capvision. Authorities questioned employees and inspected Capvision’s offices in Shanghai, Beijing, Suzhou and Shenzhen. State media claims the group had tapped personnel in party and government organs to provide sensitive information to overseas clients. Ryan McMorrow and Demetri Sevastopulo. Financial Times, 8 May
Canada seeks to join AUKUS defence partnership. Canada’s defence minister has said the country is “highly interested” in joining the second phase of the defence partnership between Australia, the UK and US. Though Trudeau has stressed in the past that Canada is not in the market for nuclear submarines, there are reportedly fears the country could be left out of crucial intelligence and technology sharing. Leyland Cecco. The Guardian, 8 May
US and allies warm to potential China role in ending Ukraine conflict. US and European officials have hinted at a shift in Western thinking, as Secretary of State Antony Blinken publicly expressed cautious optimism that Beijing could help defuse the conflict. Bojan Pancevski, Laurence Norman and Vivian Salama. Wall Street Journal, 7 May
China holds security and trade talks with the Taliban. China’s foreign minister Qin Gang held talks with counterparts from Pakistan and Afghanistan. The parties discussed plans to bring Afghanistan into the Belt and Road infrastructure project as Beijing looks to boost investment. Benjamin Parkin, Farhan Bokhari and John Reed. Financial Times, 7 May
Mexico claims proof of Chinese fentanyl smuggling. A container of the drug was intercepted in the Pacific port of Lázaro Cárdenas. The cargo originated in the Chinese city of Qingdao and passed through Busan in South Korea before reaching Mexico. In March, President López Obrador said he had written to Chinese President Xi Jinping requesting Chinese help to counter the illicit trade. BBC News, 6 May
Economy & tech
HSBC shareholders vote to reject proposal to spin off Asian operations. The initiative, backed by Chinese insurer and HSBC’s largest investor Ping An, received only about 20 percent of the votes. Michael J. de la Merced. New York Times, 5 May
Tiktok tracked UK journalist via her cats account. TikTok confirmed members of its internal audit department in China looked at the location of journalist’s IP address and compared it with the IP data of an unknown number of their own staff, to try to establish who was secretly meeting with the press. Bytedance has said the staff responsible were fired for misconduct. BBC News, 5 May
China gave 190 chip firms US$1.75 billion in subsidies in 2022, illustrating national priorities amidst protracted tech war. China’s largest chip maker was the the largest subsidiary recipient at US$282.1 million. Ann Cao. South China Morning Post, 7 May
Japanese companies seeking US deals fear scrutiny of China links. As CFIUS steps up reviews of buyers’ links with China, trade lawyers warn Japanese companies are particularly vulnerable due to decades’ worth of investment, joint ventures and other business connections in China. Leo Lewis, Kana Inagaki and Stefania Palma. Financial Times, 7 May
US sanctions drive Chinese firms to advance AI without newest chips. Chinese tech companies - including Huawei, Baidu and Alibaba Group - have accelerated research into potential workarounds that won’t rely on latest American semiconductor developments. Karen Hao and Raffaele Huang. Wall Street Journal, 7 May
Campaign to limit overseas access to China-based data sources was partly triggered by US think tank reports. Beijing was reportedly rattled by analysis written by the Center for Security and Emerging Technology at Georgetown University and the Center for a New American Security, co-founded by Kurt Campbell, the White House’s coordinator for the Indo-Pacific. Lingling Wei. Wall Street Journal, 7 May
Opinion & long reads
How top silicon valley investor Sequoia bankrolls China’s tech. Sequoia Capital, the most aggressive American investor in the Chinese tech scene, has stakes in TikTok-owner Bytedance and sanctioned drone-maker DJI. Danny Fortson. The Sunday Times, 6 May
Where did China’s belt and road plans go wrong in Italy? Four years after signing up for the controversial infrastructure initiative, Italy must decide whether or not to withdraw from the BRI. Prime Minister Giorgia Meloni is likely to clarify Italy’s position when meeting with fellow G7 leaders meet in Japan later this month. Kawala Xie. South China Morning Post, 7 May
China’s war chest: how Beijing is using its currency to insulate against future sanctions. A drive to insulate China’s economy from dollar-based sanctions has emerged as possibly the most important incentive for decoupling from the dollar. Amy Hawkins. The Guardian, 8 May
Why we need a more balanced approach to China. President and provost of University College London puts forward an argument against severing academic ties with China. Michael Spence. The New Statesman, 8 May
Did China Help Vancouver’s Mayor Win Election? Ken Sim, Vancouver’s first mayor of Chinese descent, rejects claims of Chinese interference following landslide victory. Dan Bilefksy. New York Times, 7 May
Why China may be reluctant to get too deeply involved in Sudan peace efforts. Analysts cite tensions with the West, China’s support for the previous regime and Sudan’s declining importance as an oil exporter. Jevans Nyabiage. South China Morning Post, 7 May