Archive for ‘Center for Strategic and International Studies’

15/05/2020

Trump says doesn’t want to talk to Xi, could even cut China ties

WASHINGTON (Reuters) – U.S. President Donald Trump signaled a further deterioration of his relationship with China over the coronavirus outbreak, saying he has no interest in speaking to President Xi Jinping right now and going so far as to suggest he could even cut ties with the world’s second largest economy.

In an interview with Fox Business Network broadcast on Thursday, Trump said he was very disappointed with China’s failure to contain the disease and that the pandemic had cast a pall over his January trade deal with Beijing, which he has previously hailed as a major achievement.

“They should have never let this happen,” Trump said. “So I make a great trade deal and now I say this doesn’t feel the same to me. The ink was barely dry and the plague came over. And it doesn’t feel the same to me.”

Trump’s pique extended to Xi, with whom the U.S. president has said repeatedly he has a good relationship.

“But I just – right now I don’t want to speak to him,” Trump said in the interview, which was taped on Wednesday.

Trump was asked about a Republican senator’s suggestion that U.S. visas be denied to Chinese students applying to study in fields related to national security, such as quantum computing and artificial intelligence.

“There are many things we could do. We could do things. We could cut off the whole relationship,” he replied.

“Now, if you did, what would happen? You’d save $500 billion,” Trump said, referring to estimated U.S. annual imports from China, which he often refers to as lost money.

Chinese foreign ministry spokesman Zhao Lijian told reporters in Beijing on Friday that maintaining a steady bilateral relationship served the interests of both peoples and would be beneficial for world peace and stability.

“Both China and the U.S. should now be cooperating more on fighting the virus together, to cure patients and resume economic production, but this requires the U.S. to want to work with us on this,” Zhao said.

Trump’s remarks drew ridicule from Hu Xijin, editor in chief of China’s influential Global Times tabloid, who referred to the president’s much-criticized comments last month about how COVID-19, the disease caused by the coronavirus, might be treated.

“This president once suggested COVID-19 patients inject disinfectants,” Hu said on Twitter. “Remember this and you won’t be surprised when he said he could cut off the whole relationship with China.”

CONCERNED, REVIEWING OPTIONS

U.S. Treasury Secretary Steven Mnuchin told Fox Business Network China needed to provide a lot more information about the coronavirus and Trump was reviewing his options.

“The president is concerned. He’s reviewing all his options. Obviously, we’re very concerned about the impact of this virus on the economy, on American jobs, the health of the American public and the president is going to do everything to protect the economy and protect American workers,” Mnuchin said.

“It’s a difficult and complex matter and the president has made very clear, he wants more information. They didn’t let us in, they didn’t let us understand what was going on.”

Trump and his Republican backers have accused Beijing of failing to alert the world to the severity and scope of the coronavirus outbreak and of withholding data about the earliest cases. The pandemic has sparked a sharp global recession and threatened Trump’s November re-election chances.

The United States has been hardest hit by the pandemic, according to official data.

China insists it has been transparent, and, amid increasingly bitter exchanges, both sides have questioned the future of the trade deal.

Opponents of Trump have said that while China has much to answer for over the outbreak, he appears to be seeking to deflect attention from criticism over his response to the crisis.

Scott Kennedy of Washington’s Center for Strategic and International Studies think tank called Trump’s remarks “dangerous bravado.”

“Avoiding communication is not an effective strategy for solving a crisis that requires global cooperation. And cutting off the economic relationship would badly damage the American economy,” he said.

Michael Pillsbury, a China analyst who has worked as an outside adviser to Trump, told Reuters he believed the president was concerned that China not only wanted to re-negotiate the Phase 1 deal, but also had not been meeting goals in purchasing from United States.

He said that according to figures cited by the China Daily, China’s purchases of U.S. products in the first four months of this year were 3% less than during the same period last year.

“It’s not good news for reducing the trade deficit or helping our economy recover from the coronavirus crisis,” he said.

China took some additional steps towards the Phase 1 goals on Thursday, buying U.S. soybean oil for the first time in nearly two years and issued customs notices allowing imports of U.S. barley and blueberries.

An executive from Chinese state agriculture trading house COFCO said China was set to speed up purchases of U.S. farm goods to implement the Phase 1 deal.

While U.S. intelligence agencies have said the coronavirus does not appear manmade or genetically modified, Trump said in his interview that China should have stopped it at its source.

“Whether it came from the lab or came from the bats, it all came from China, and they should have stopped it,” he said.

“It got out of control.”

Source: Reuters

28/03/2020

The uncertain future for China’s electric car makers

Han Zhu at the Tesla dealershipImage copyright HAN ZHU
Image caption Choosing an electric car was an easy decision for Shenzhen resident Han Zhu

Han Zhu is on a mission to go green. The 29-year-old data analyst wants her next car to be electric. But her reasons for buying an electric vehicle are in part practical.

In the southern Chinese city of Shenzhen, government restrictions on the number of petrol cars sold each year mean she would have to enter a lottery or auction to be able to buy a petrol vehicle.

“There is a possibility you may never get it. With the electric vehicle green licence, you don’t have to wait in line,” she says.

Shenzhen has become the showpiece capital for the Chinese electric dream. In 2017 it became the first city in the world to introduce a fleet of electric buses. A year later, the government rolled out a plan to replace city taxis with electric cars.

“In Shenzhen, in almost every residential building there are two charging units. One out of 10 cars on the street are Teslas,” she says. “In China if the policy leads in one direction, technology and money goes in that direction too,” she says.

This photo taken on January 14, 2019 shows a man plugging in an electric vehicle at a Sinopec service station in Hangzhou, in China's eastern Zhejiang province.Image copyright GETTY IMAGES
Image caption China has the world’s biggest market for electric vehicles

In less than a decade China’s new electric vehicle market has become the largest in the world. In 2018 more than a million electric vehicles were sold in China, more than three times the number sold in the US.

Beijing invested an estimated $50bn (£43bn) in the industry, hoping that today’s dominance of the electric vehicle market would lead to global automobile supremacy tomorrow.

And thus far the policy has been working. Over the last three years the number of Chinese electric vehicle manufacturers has tripled, with more than 400 registered nationwide.

But that breakneck expansion alarmed the government. Last year it decided to put the brakes on by withdrawing approximately half of its financial incentives for buyers.

A slump in sales quickly followed, in the last quarter of 2019 sales for electric vehicles plummeted.

Now the coronavirus has supplied a second punch.

Manufacturers have been forced to halt production lines and close dealerships in a bid to stop the spread of virus.

Overall auto sales in plunged 79% in February compared with the same month in 2019, according to figures from the China Association of Automobile Manufacturers. Sales of new energy vehicles (NEVs) fell for the eighth month in a row.

“China’s auto market was already reeling from a large drop in demand in 2019. In 2020 no carmaker has been immune to the effects of the coronavirus. That includes everyone from the oldest joint ventures producing internal combustion engine SUVs to the most innovative upstarts making connected electric vehicles,” says Scott Kennedy from the Center for Strategic and International Studies.

“The vast majority [of electric car makers] will not survive. But how long they survive and whether industry consolidation occurs through lots of mergers or bankruptcies will depend on the willingness of the government.”

The NIO EP9Image copyright NIO
Image caption The NIO EP9 is one of the fastest electric cars in the world

After listing on the New York Stock Exchange in 2018 and raising billions of dollars, NIO is perhaps the highest-profile Chinese maker of electric cars.

But in the five years since it was founded it has been beset by problems and has burned through hundreds of millions of dollars. In 2019 the company cut 2,000 jobs on the back of falling revenues. In February it announced it had signed a tentative agreement with a local government that has pledged to fund the company.

“China is a huge market growing at an immense pace. We will adjust and adapt to the market condition,” said an NIO spokesperson.

And it’s not just the car makers. China has some giant makers of components, such as batteries.

In 2018 CATL, a Chinese electric battery maker, became the official supplier of BMW’s electric cars.

Last month Tesla announced it would enter into an agreement with the company to supply batteries for Tesla’s newly built Shanghai mega-plant, capable of producing 500,000 vehicles a year.

Robotic arms spray paint a car body shell at the BYD Automobile Company Limited Xi'an plant on December 25, 2019 in Xi'an, Shaanxi Province of China.Image copyright GETTY IMAGES
Image caption China’s BYD is the one of the world’s biggest makers of electric vehicles

But despite that apparent success, analysts have their doubts.

“Chinese auto and battery technology is still not world-class. CATL and BYD are strong battery makers, but they are still somewhat behind technologically from their South Korean and Japanese counterparts. And Chinese automakers are still second-class producers even in their own country and they have barely any sales outside China,” says Mr Kennedy.

For car buyers, that question of quality hangs over China’s electric car makers.

Yi Zhi Yong, a middle-aged entrepreneur, drives a hybrid car made by Chinese manufacturer BYD. Backed by US billionaire Warren Buffett, the company was the third-largest battery-only electric car producer in the world in 2019, according to research by EV-volumes.com. Tesla sold the most, followed by another Chinese firm, BAIC.

He didn’t buy a pure electric vehicle because he is not confident about the quality.

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“The quality of domestic pure electric vehicles is not good at the moment,” he says. “No domestic pure electric vehicle is worth buying yet.”

But he feels the progress made by China is a source of national pride. “In the 1990s we couldn’t imagine that China could build cars that can compete with the Japanese,” he says.

Back in Shenzhen, Han Zhu says the rolling back of government subsidies won’t put her off buying an electric vehicle. But rather than buying a Chinese marque, she has her eye on a Tesla.

“I think that they are totally different. I was super excited about Tesla but not other electric cars,” she says.

Source: The BBC

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