Archive for ‘image’


Inside China’s state-owned industrial park in Vietnam, Beijing’s image trumps trade war profits

  • China-Vietnam (Shenzhen-Haiphong) Economic and Trade Cooperation Zone is only Chinese state-owned industrial park in Vietnam
  • Venture has attracted increasing interest since start of US-China trade war, but operators say first duty is to support Xi Jinping’s trade initiative
A total of 16 of the 21 Chinese companies that have relocated to the China-Vietnam (Shenzhen-Haiphong) Economic and Trade Cooperation Zone did so after the start of the US-China trade war. Photo: Cissy Zhou
A total of 16 of the 21 Chinese companies that have relocated to the China-Vietnam (Shenzhen-Haiphong) Economic and Trade Cooperation Zone did so after the start of the US-China trade war. Photo: Cissy Zhou
Until the middle of 2018, business was slow for the only Chinese state-owned industrial park in Vietnam, located in the northeastern manufacturing hub of Haiphong and wholly-owned by the Shenzhen city government.
US President Donald Trump’s tariffs on Chinese goods enacted last year changed that, with 16 of the 21 Chinese companies that have relocated to the China-Vietnam
(Shenzhen-Haiphong) Economic and Trade Cooperation Zone – many of them electronic device manufacturers – having done so since the start of the trade war.
However, profit-making was never the top priority for the park’s operators, which took over the reins from private investors after a series anti-Chinese riots raged through southern and central Vietnam in May 2014 forced the owners to abandon the project.
Protesters set fire to other industrial parks and factories and attacked Chinese workers, killing more than 20 people and injuring more than 100.

While any commercial organisation would be thrilled at the rush of manufacturing firms into Vietnam, for the park’s operators, the first duty is to showcase the Chinese government’s top international economic cooperation project, the Belt and Road Initiative.

[They] requested that we make this industrial park a showcase for the Belt and Road Initiative, so that when our top leaders pay state visits to Vietnam, they can come to our park Chen Xu

The Shenzhen arm of the State-owned Assets Control and Supervision Commission (SASAC), which oversees all city owned companies “has requested that we make this industrial park a showcase for the Belt and Road Initiative, so that when our top leaders pay state visits to Vietnam, they can come to our park”, Chen Xu, vice general manager at the Vietnam-China Economic and Trade Cooperation Park (VCEP), told the South China Morning Post.
The Chinese industrial enclave in Vietnam is part of a largely untold story of the trade war. The common narrative is that Chinese and international firms are fleeing China to avoid paying tariffs, setting up in low-cost hubs in Vietnam and elsewhere in Southeast Asia, but the picture is more nuanced than that.

In Haiphong, a part of the Chinese government is actively encouraging firms to come to Vietnam, armed with US$200 million in investment capital and with a vision of creating 30,000 jobs by the time the entire three-phase project is completed in 2022.

The then-private VCEP project was suspended after the 2014 riots, and after the local government in Vietnam said it would reclaim the land unless it resumed, the Shenzhen government “decided to fully take over the project”, according to VCEP general manager Zhang Xiaotao.

Newcomers must now buy land from the park and build their facilities themselves as the original buildings have already been rented out. Photo: Cissy Zhou
Newcomers must now buy land from the park and build their facilities themselves as the original buildings have already been rented out. Photo: Cissy Zhou

“Our evaluation then was that we could not make a profit out of this project. Then why did we still take it over? We have to serve the Belt and Road Initiative, as it is a national strategy,” Zhang added. “In fact, we surrender part of our profit [because] we sell the land [in the park] at a lower price and with better facilities than in neighbouring industrial parks. We are still in the red based upon the current land price. Our bosses understand the situation and ask us at least not to lose money.

“To make a profit is of course the priority of any company. But we are different, we are not a pure commercial project.”

Furthermore, it is a commonly held assumption that China is only open to losing low-end, labour intensive and high-polluting industry, as it looks to upgrade its manufacturing profile domestically. And while there is certainly truth to that as examples of low-value Chinese manufacturing plants litter Vietnam, VCEP is keen to avoid that persona.

Because of the need to maintain a relatively high-profile, the park does not welcome labour-intensive manufacturers such as shoes factories, because “it is bad for our image”, Chen said. Instead, it is focused on hi-tech engineering – exactly the kind of industry China is desperate to nurture on its own soil. In this sense, the Shenzhen-Haiphong facility represents something of a paradox.

With 1,500 people currently employed, it is some way from reaching its 30,000 goal, but the number of Chinese manufacturers wanting to set up factories in the park is now about eight times what it was before the trade war started last July, according to both Chen and Zhang. Newcomers must now buy land from the park and build their facilities themselves as the original buildings have already been rented out.

The relatively poor state of the surrounding infrastructure has also led VCEP to spend 30 million yuan (US$4.3 million) on a new road and bridge linking the park to the national highway in Haiphong.

“We could not wait for the Vietnamese government to build the infrastructure. They don’t have the money and their efficiency is low, so we built it ourselves,” said Li Meng, a member of VCEP’s Strategic Investment Department, who said it took less than nine months to finish the project.

The cost of the bridge was more than triple what it would have cost in China as “the efficiency is much lower here and we needed to import a lot of material from China due to lack of material in Vietnam”, Li added

“Every inch of the road and the bridge linking the national highway in Haiphong to VCEP is paved with renminbi.”

The Vietnam-China Economic and Trade Cooperation Park has a vision of creating 30,000 jobs by the time the entire three-phase project is completed in 2022. Photo: Cissy Zhou
The Vietnam-China Economic and Trade Cooperation Park has a vision of creating 30,000 jobs by the time the entire three-phase project is completed in 2022. Photo: Cissy Zhou

TP-Link, the Shenzhen-based Chinese manufacturer of computer networking products, has rented a plant in the park and will start testing its equipment in July. The company, the world’s largest provider of consumer Wi-fi networking devices, has bought an additional 140,000 square metres of land in the park to expand production.

When TP-Link bought the land in late-2018, the price was between US$75 to US$80 per square metre, Chen said. Now, six months later, the price has risen to US$90 per square metre. This is indicative of the huge spike in interest in manufacturing in Vietnam caused by the trade war. Data from Vietnam’s Foreign Investment Agency shows that Vietnam attracted US$16.74 billion in foreign capital over the first five months of 2019, a year-on-year increase of 69.1 per cent. Of this, 72 per cent was invested in the processing and manufacturing sectors.

“Chinese local governments are, of course, unhappy with the increasing number of manufacturers who are relocating to Vietnam, but President Xi has clearly put forward the Belt and Road Initiative, which local governments cannot disturb. So local governments are not encouraging manufacturers to relocate, but they dare not try to stop them,” said vice-general manager Chen.

The Chinese inflow has also met with opposition in Vietnam, although far from the scale of the deadly riots of 2014.

“Some local [Vietnamese] media have been demonising China, with local prime time TV news talking about fake Chinese meat and poisoned food and hyping these cases. High-ranking Chinese officials have asked the Vietnamese government to guide public opinion in the right direction,” Chen added.

General manager Zhang added that the Vietnamese authorities have also become more sensitive to investment from China, a view reflected by Lam Thanh Ha, a senior lecturer at the Diplomatic Academy of Vietnam university which operates under the management of Vietnam’s Ministry of Foreign Affairs. “Overreliance on foreign cash in general and Chinese capital in particular may pose risks for Vietnam in terms of exchange rate fluctuations and external influences,” Ha warned.

“As production is generally dependent on transnational supply chains, foreign enterprises in Vietnam are often deeply engaged in both import and export processes, leaving the Vietnamese economy vulnerable to global economic conditions,” Ha added.

In a 

commentary published

by the Post earlier in May, Ha warned that Vietnam should avoid “becoming China’s dirty industrial backyard”, although Zhang had the opposite view.

“We are not shifting all our low-end industries to Vietnam, which would be irresponsible. China is trying to help Vietnam with sincerity, even if we don’t make a profit, we still want to proceed with the project,” he said.
Source: SCMP

Leica China video sparks backlash over Tiananmen Square image

A man stands in front of three tanksImage copyrightREUTERS
Image caption This year marks the 30th anniversary of the pro-democracy protests

A promotional video for camera company Leica has sparked backlash in China for featuring a famous Tiananmen Square image.

The video depicts photographers working in conflicts around the world, including a photographer covering the 1989 protests.

People on Chinese social media site Weibo have called for a boycott of the camera brand.

Leica has distanced itself from the video.

“Tank Man” was a lone protester who brought a column of tanks to a standstill during a crackdown on pro-democracy protesters in Beijing in 1989.

He refused to move out of the way and climbed onto the leading tank to speak to the driver. He was later pulled away from the scene by two men. What happened to him remains unknown.

Beginning with the caption “Beijing 1989”, the Leica video features a photographer taking the famous image. The “Tank Man” can be seen in the camera’s lens.

Users on Chinese social media site Weibo have been forbidden from commenting on recent official posts by Leica. However some people are managing to post carefully worded comments on earlier official Leica posts, BBC Monitoring has found.

A search of the hashtag Leica shows that 42,000 users have left posts on Weibo but only 10 are available to view.

Some comments urge users to “boycott the camera” and joke about the company being linked to “patriotic Huawei”.

Chinese technology giant Huawei has been restricted by the US and other countries over security concerns in telecommunications networks. Consumers in China have rallied around the company, which uses Leica technology in its latest mobile phones.

A spokeswoman for Leica told the South China Morning Post that the film was not an officially sanctioned marketing film commissioned by the company. However it features Leica cameras and the company’s logo at the end of the footage.

They added that the company “must therefore distance itself from the content shown in the video and regrets any misunderstandings of false conclusions that may have been drawn”.

The BBC has contacted Leica for additional comment.

How China keeps Tiananmen off the internet

By Kerry Allen, BBC Monitoring China analyst

China has banned all activists’ commemorations of the 1989 Tiananmen incident for years and has strictly regulated online discussion of it.

If users search for “Tiananmen” on domestic search engines like Baidu or social media platforms like Sina Weibo, they only see sunny pictures of the Forbidden City in Beijing. If any pictures of tanks running along Chang’an Avenue are visible in image searches, they are only from Victory Day parades.

Hundreds of references to 4 June 1989 are banned all-year round by thousands of cyber police, and Weibo steps up censorship of even seemingly innocuous references to the incident on its anniversary.

Simple candle emojis, and number sequences that reference the date, such as “46” and “64” (4 June) and “1989” (the year of the protests), are instantly deleted. Small businesses also struggle to market items on 4 June every year, if their sale price is 46 or 64 yuan. Such advertising posts are swiftly removed by nervous censors.

But creative users always find ways of circumventing the censors. For example in 2014, when Taylor Swift released her 1989 album, the album cover featuring the words “T.S.” and “1989” was seen as an effective metaphor by users to talk about the incident – as T.S. could be taken to mean “Tiananmen Square”.

More than one million Chinese students and workers occupied Tiananmen Square in 1989, beginning the largest political protest in communist China’s history. Six weeks of protests ended with the bloody crackdown on protesters of 3-4 June.

Estimates of the death toll range from several hundred to more than 1,000.

China’s statement at the end of June 1989 said that 200 civilians and several dozen security personnel had died in Beijing following the suppression of “counter-revolutionary riots” on 4 June 1989.

Source: The BBC


‘War’ and India PM Modi’s muscular strongman image

Indian Prime Minister Narendra Modi gestures as he speaks during the National Democratic Alliance (NDA) "Sankalp" rally in Patna in the Indian eastern state of Bihar on March 3, 2019.Image copyrightAFP
Image captionMr Modi is accused of exploiting India-Pakistan hostilities for political gain

A gaffe is when a politician tells the truth, American political journalist Michael Kinsley said.

Last week, a prominent leader of India’s ruling Hindu nationalist Bharatiya Janata Party (BJP) appeared to have done exactly that. BS Yeddyurappa said the armed aerial hostilities between India and Pakistan would help his party win some two dozen seats in the upcoming general election.

The remark by Mr Yeddyurappa, former chief minister of Karnataka, was remarkable in its candour. Not surprisingly, it was immediately seized upon by opposition parties. They said it was a brazen admission of the fact that Prime Minister Narendra Modi’s party was mining the tensions between the nuclear-armed rivals ahead of general elections, which are barely a month away. Mr Modi’s party is looking at a second term in power.

Mr Yeddyurappa’s plain-spokenness appeared to have embarrassed even the BJP. Federal minister VK Singh issued a statement, saying the government’s decision to carry out air strikes in Pakistan last week was to “safeguard our nation and ensure safety of our citizens, not to win a few seats”. No political party can afford to concede that it was exploiting a near war for electoral gains.

A billboard displaying an image of Indian Prime Minister Narendra Modi holding a rifle is seen on a roadside in Ahmedabad on March 3, 2019.Image copyrightAFP
Image captionThe BJP has put up election posters of Mr Modi posing with guns

Even as tensions between India and Pakistan ratcheted up last week, Mr Modi went on with business as usual. Hours after the Indian attack in Pakistan’s Balakot region, he told a packed election meeting that the country was in safe hands and would “no longer be helpless in the face of terror”. Next morning, Pakistan retaliated and captured an Indian pilot who ejected from a downed fighter jet. Two days later, Pakistan returned the pilot to India.

Mr Modi then told a gathering of scientists that India’s aerial strikes were merely a “pilot project” and hinted there was more to come. Elsewhere, his party chief Amit Shah said India had killed more than 250 militants in the Balakot attack even as senior defence officials said they didn’t know how many had died. Gaudy BJP posters showing Mr Modi holding guns and flanked by soldiers, fighter jets and orange explosions have been put up in parts of the country. “Really uncomfortable with pictures of soldiers on election posters and podiums. This should be banned. Surely the uniform is sullied by vote gathering in its name,” tweeted Barkha Dutt, an Indian television journalist and author.

Mr Modi has appealed to the opposition to refrain from politicising the hostilities. The opposition parties are peeved because they believe Mr Modi has not kept his word. Last week, they issued a statement saying “national security must transcend narrow political considerations”.

‘Petty political gain’

But can the recent conflict fetch more votes for Mr Modi? In other words, can national security become a campaign plank?

Many believe Mr Modi is likely to make national security the pivot of his campaign. Before last month’s suicide attack – claimed by Pakistan-based militants – killed more than 40 Indian paramilitaries in Kashmir, Mr Modi was looking a little vulnerable. His party had lost three state elections on the trot to the Congress party. Looming farm and jobs crises were threatening to hurt the BJP’s prospects.

Now, many believe, Mr Modi’s chances look brighter as he positions himself as a “muscular” protector of the country’s borders. “This is one of the worst attempts to use war to win [an] election, and to use national security as petty political gain. But I don’t know whether it will succeed or not,” says Yogendra Yadav, a politician and psephologist.

Indian people feed sweets to a poster of Indian Prime Minister Narendra Modi as they celebrate the Indian Air Force"s air strike across the Line of Control (LoC) near the international border with PakistanImage copyrightEPA
Image captionMany Indians have celebrated India’s strike in Pakistani territory

Evidence is mixed on whether national security helps ruling parties win elections in India. Ashutosh Varshney, a professor of political science at Brown University in the US, says previous national security disruptions in India were “distant from the national elections”.

The wars in 1962 (against China) and 1971 (against Pakistan) broke out after general elections. Elections were still two years away when India and Pakistan fought a war in 1965. The 2001 attack on the Indian parliament that brought the two countries to the brink of war happened two years after a general election. The Mumbai attacks in 2008 took place five months before the elections in 2009 – and the then ruling Congress party won without making national security a campaign plank.

Things may be different this time. Professor Varshney says the suicide attack in Kashmir on 14 February and last week’s hostilities are “more electorally significant than the earlier security episodes”.

For one, he says, it comes just weeks ahead of a general election in a highly polarised country. The vast expansion of the urban middle class means that national security has a larger constituency. And most importantly, according to Dr Varshney, “the nature of the regime in Delhi” is an important variable. “Hindu nationalists have always been tougher on national security than the Congress. And with rare exceptions, national security does not dominate the horizons of regional parties, governed as they are by caste and regional identities.”

Presentational grey line

Read more from Soutik Biswas

Presentational grey line

Bhanu Joshi, a political scientist also at Brown University, believes Mr Modi’s adoption of a muscular and robust foreign policy and his frequent international trips to meet foreign leaders may have touched a chord with a section of voters. “During my work in northern India, people would continuously invoke the improvement in India’s stature in the international arena. These perceptions get reinforced with an event like [the] Balakot strikes and form impressions which I think voters, particularly on a bipolar contest of India and Pakistan, care about,” says Mr Joshi.

Others like Milan Vaishnav, senior fellow and director of the South Asia Program at the Carnegie Endowment for International Peace, echo a similar sentiment. He told me that although foreign policy has never been a “mass” issue in India’s domestic politics, “given the proximity of the conflict to the elections, the salience of Pakistan, and the ability of the Modi government to claim credit for striking back hard, I expect it will become an important part of the campaign”.

But Dr Vaishnav believes it will not displace the economy and farm distress as an issue, especially in village communities. “Where it will help the BJP most is among swing voters, especially in urban constituencies. If there were fence-sitters unsure of how to vote in 2019, this emotive issue might compel them to stick with the incumbent.”

How the opposition counters Mr Modi’s agenda-setting on national security will be interesting to watch. Even if the hostilities end up giving a slight bump to BJP prospects in the crucial bellwether states in the north, it could help take the party over the winning line. But then even a week is a long time in politics.

Source: The BBC

Law of Unintended Consequences

continuously updated blog about China & India

ChiaHou's Book Reviews

continuously updated blog about China & India

What's wrong with the world; and its economy

continuously updated blog about China & India