Chindia Alert: You’ll be Living in their World Very Soon
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— As the continued global spread of COVID-19 is weighing on the world economy, China’s foreign trade is under considerable downward pressure.
— Many export-oriented companies in China are turning to the domestic market for a lifeline while grappling with dropping overseas orders as major markets remain in the grip of the pandemic.
by Xinhua writers Zhang Yizhi, Li Huiying, Hu Guanghe, Xu Ruiqing
FUZHOU, May 9 (Xinhua) — Walking back and forth between shelves of neatly stacked shoes, some 20 live streamers dashed at the instructions of their followers on the phone, grabbing a shoe now and then from the shelves for a close-up in front of the camera.
At around eight o’clock every night, the supply chain platform 0594 in the city of Putian, east China’s Fujian Province, springs to life as live streamers flock to the exhibition area to sell shoes produced by the local manufacturers, many of which are troubled by the cancellations or delays of overseas orders amid the global coronavirus pandemic.
“To get rid of the excess inventory, many manufacturers in Putian are turning to live streaming to explore the domestic market,” said Chen Xing, general manager of 0594. “We are now cooperating with over 40 manufacturers and there will be more of them joining us in the future.”
The platform is also building an internet celebrity incubator and has so far organized seven rounds of influencer training courses enrolling more than 200 attendees.
Huang Huafang, 39, signed up for the two-day crash course in late March and soon after started her first live streaming session. She works from around 2 p.m. to 10 p.m., attracting over 500 followers and selling more than 20 pairs of shoes every day.
Though she is not a well-known live streamer, she is optimistic about the future. “There is a long way to go, but I believe live streaming is a trend. It is an essential skill for anyone who wants to market online,” said Huang.
A staff sells shoes through live streaming at an e-commerce warehouse in Putian, southeast China’s Fujian Province, May 7, 2020. (Xinhua/Lin Shanchuan)
According to Chen, the platform 0594 sold almost 130,000 pairs of shoes in April alone. As the domestic economic outlook continues to pick up, the sales target of May has been set at 200,000 pairs.
Like manufacturers in Putian, a city with a large number of export-oriented enterprises, many Chinese factories are turning to the domestic market for a lifeline, while grappling with dropping overseas orders as major markets remain in the grip of the pandemic.
ADAPT OR DIE
With decades of experience in manufacturing and developing products for overseas clients, some export-oriented companies in China are rolling out products catering to the domestic market.
After months of gloomy business, Wu Songlin, general manager of Putian-based Hsieh Shun Footwear Co., Ltd., heaved a sigh of relief as trucks loaded with therapeutic shoes tailored to the home market left his factory.
It was the first shipment for the domestic market since Wu and his partners started the company in 2010. In the past, his company only had two clients, one from Europe and the other from Japan. Business used to run smoothly and life was good.
But his factory was on the brink of a shutdown in March when the coronavirus pandemic started to ravage the global economy. No new orders came in and shipments of existing orders were requested to be delayed until June.
People work in a footwear workshop in Putian, southeast China’s Fujian Province, April 27, 2020. (Xinhua/Lin Shanchuan)
“Orders were canceled after completion of production, and our capital flow is stuck in our inventory. The pressure is mounting to keep the factory running,” Wu said. “By the end of June, workers would be left with no work to do as soon as we complete the existing orders.”
After losing almost all their orders from overseas clients, the desperate shoemaker turned to the domestic market. He called one of his old business partners and secured an order for massage footwear, which is selling like hot cakes in the domestic market as health tops the agenda in the time of the novel coronavirus.
The factory produced 10,000 pairs of massage shoes in April, and the number is expected to reach 30,000 in May, enough to keep the production lines running.
Thanks to the company’s quick adaptation, about 200 workers kept their jobs in the factory, while 20 percent were furloughed and the remaining workers were arranged to work in other companies as part of the city’s employee sharing program.
“If domestic orders keep coming in, our operation will hopefully get back to normal by September when the monthly output of massage shoes will reach 90,000,” Wu said. “By then the company will live and thrive without any orders from overseas customers.”
A woman works in a workshop of Hsieh Shun Footwear Co., Ltd. in Putian, southeast China’s Fujian Province, May 7, 2020. (Xinhua/Lin Shanchuan)
But switching to another market is not easy, explained Wu. In the past, export-oriented factories were only in charge of manufacturing, while brands would take care of sales, promotion as well as customer support.
“If you are selling to the domestic market, you need to have your own brand and marketing capacity,” he said. “Working with e-commerce platforms could be one way out, but it’s more important to understand domestic consumers and meet their needs.”
CUSTOMIZE THE FUTURE
For years, many export-focused manufactures have been trying to climb up the value chain and tap the uncharted waters of the domestic market. As the pandemic continues to spread, there is a strong push for them to embrace customized manufacturing.
In an experience store located in downtown Putian, customers line up waiting to have their feet measured on a smart device. After a few seconds, they get their readings on the phone, and a few swipes and clicks later, they place their orders with unique features, colors, and shapes.
Adjacent to the experience store, there is a flexible manufacturing workshop, which gives quick responses to orders and produces shoes following the customized demands of individual buyers.
SEMS, a longstanding sports footwear manufacturer that has established a partnership with several international brands, started to adopt flexible manufacturing years ago in an effort to adapt to the evolving domestic market.
A customer has her feet measured on a smart device in sports footwear manufacturer SEMS in Putian, southeast China’s Fujian Province, May 8, 2020. (Xinhua/Lin Shanchuan)
Customization gives consumers the benefit of products that fit their needs, and at the same time allows factories to utilize improved workflows and technology to maintain high output and omit the process of inventory and distribution, said Zhu Yizhen, the executive vice president of the company.
“Currently we only sell over 100 pairs of customized shoes a day, but we are at the dawn of a new era,” Zhu said. “We hope more companies awaken to the developing trend and join in the practice of mass customization.”
Customer to manufacturer, or C2M, which allows consumers to place orders directly to factories for customized products, has become a buzzword among export-oriented manufacturers hoping to reach domestic consumers amid the pandemic.
Li Junjie, who runs a ceramic flowerpot plant in Fujian’s Dehua County, one of the manufacturing centers of ceramics in China, did not sell a single pot to his overseas customers since the coronavirus outbreak in late January.
The factory used to export 30 percent of its flowerpots to the United States and Spain, but Li managed to make up for the lost deals by selling on domestic e-commerce platforms. Instead of bulk orders placed by foreign clients, domestic consumers tend to purchase customized products in small amounts.
Photo shows the automatic production line of a customized workshop in sports footwear manufacturer SEMS in Putian, southeast China’s Fujian Province, May 8, 2020. (Xinhua/Lin Shanchuan)
With the big data provided by e-commerce platforms, Li can tell which items will be a hit so as to increase their production and develop new products based on a thorough analysis of different consumer groups.
“Our online sales almost doubled over the past year, and we have sold over 100,000 customized pots this year, thanks to the C2M business model,” Li said.
Li’s company is one of many Chinese small and medium-sized enterprises (SMEs) that have benefited from the e-commerce giant Alibaba’s Spring Thunder Initiative, which is aimed at helping export-focused SMEs expand into new markets.
The initiative will also help some SMEs to transform and develop their business in the Chinese market through measures such as resource support, fee reductions, and fast-track processing.
Nations may need help from China during virus outbreaks but remain wary of Beijing as adversary in disputed waters
Analysts say code of conduct negotiations are too sensitive and important for virtual meetings and may be delayed until coronavirus crisis is resolved
On April 18, the US Navy Ticonderoga-class guided missile cruiser USS Bunker Hill (front) and Arleigh-Burke class guided-missile destroyer USS Barry transit the South China Sea. The presence of both Chinese and American navy ships in the area in recent weeks worries Southeast Asian nations. Photo: US Navy
Negotiations between China and its Southeast Asian neighbours for a South China Sea
code of conduct have been postponed as the nations involved put their efforts into containing the Covid-19 pandemic, creating uncertainty about whether the two sides can work together amid rising tensions in the contested territory.
Southeast Asian nations are increasingly caught in a dilemma whether to maintain relations with Beijing during the pandemic while also fearing that tensions over the disputed waters are spiralling out of control. Both Chinese and United States navies are sending vessels to the area more frequently.
Indonesian Foreign Minister Retno Marsudi expressed concern over recent activities in the South China Sea, noting that they might potentially escalate tensions at a time when global collective effort to fight Covid-19 was essential.
Speaking on Wednesday, she called on all parties to respect international law, particularly the United Nations Convention on the Law of the Sea.
“While negotiation of the code of conduct is being postponed due to Covid-19, Indonesia calls on all relevant parties to exercise self-restraint and to refrain from undertaking action that may erode mutual trust and potentially escalate tension in the region,” she said.
Indonesia’s Foreign Minister Retno Marsudi. Photo: AP
Calls for a binding code of conduct surfaced in 1995 when China occupied Mischief Reef
, a maritime feature claimed by the Philippines. China did not agree to start talks until 1999, and subsequent negotiations led to a non-binding Declaration on Conduct in 2002.
The Association of Southeast Asian Nations (Asean) and China agreed in 2018 on a draft code laying the foundations for conduct in the disputed waters. At that time, Chinese Premier Li Keqiang said China hoped to complete the negotiation by the end of 2021, a move he said could show China and Asean could jointly maintain regional peace.
Named and claimed: is Beijing spoiling for a new fight in the South China Sea?
27 Apr 2020
But tensions over the South China Sea have not calmed and, in fact, have surged in recent months with both Beijing and Washington seen to be using the Covid-19 pandemic to create a stronger presence there.
This year, the US has conducted four freedom of navigation operations in the South China Sea and China has scrambled air and sea patrols to expel US vessels.
The confrontation between Beijing and Southeast Asian nations has also intensified. Last month, a Vietnamese fishing boat sank after a collision with a Chinese coastguard vessel near the Paracel Islands, known in China as the Xisha Islands, and in Vietnam as the Hoang Sa Islands.
On Saturday, the 35th escort fleet of the Chinese navy also conducted drills in the Spratly Islands chain – known as Nansha Islands in China – after completing an operation in the Gulf of Aden, off Somalia. Analysts said the drill aimed to boost far-sea training for combat ships and boost protection against piracy for Chinese merchant ships.
Collin Koh, a research fellow at the S. Rajaratnam School of International Studies, based at Nanyang Technological University in Singapore, said the code of conduct talks had been delayed because of the pandemic, but Beijing was consolidating its position in the South China Sea amid the outbreak.
“So it’s doing what it can now to consolidate and further enhance its position before talks restart, and by then these moves will raise Beijing’s leverage in the negotiations with its Asean counterparts,” he said.
“The current situation gives it a window of opportunity amid this interlude on the talks, to further advance its physical hold in the South China Sea, especially while Asean parties have their hands full on the pandemic”.
Asean nations have turned their attention to coping with coronavirus outbreaks in their own countries. On April 14, a live video conference for the special Asean Plus Three Summit on the coronavirus pandemic was held in Hanoi. Photo: AFP
Kang Lin, a researcher with Hainan University, said progress for the code of conduct would still go ahead, but it might be affected as face-to-face meetings between officials were disrupted.
“The negotiations involves multiple departments, such as diplomacy, maritime affairs, fisheries and even oil and gas-related departments,” he said, adding that those discussions might go online and might not be as effective.
“It is not easy to predict to what extent it will affect next year's goals. If the pandemic cannot be eliminated in the first half of next year, it may be longer than the three-year period we had previously scheduled,” he said.
Richard Heydarian, an academic and former Philippine government adviser, said video-conference meetings would be inadequate for negotiations about the future of the South China Sea.
“The problem with the negotiation of the code is that these are very sensitive, difficult negotiations. I don't think you can really do it just online, these are things that are done in the corridors of power,” he said. “It’s close to impossible to have that right now with the suspension of all international meetings in the Asean.”
Heydarian said Southeast Asian nations hoped to get help from China to contain the pandemic, but were showing unease about Beijing.
“I think there is a lot of resentment building against China,” he said. “There is also a lot of desperation to get assistance from China and, at the same time, complete helplessness with the fact that it is very hard to conduct any important extended international meeting on the level of Asean and beyond under current circumstances.”
Chinese Foreign Ministry spokesman Hua Chunying said on Thursday that China would push forward negotiations on the code of conduct, and hoped the code would be useful for peace and stability over the South China Sea.
In his “verbal message of thanks”, Mr Xi said he highly appreciated Mr Kim’s support during China’s outbreak and “showed his personal attention to the situation of the pandemic and people’s health” in North Korea, according to state media.
Mr Xi called for more efforts to strengthen co-operation in preventing the spread of the coronavirus, and said China was “willing to continue to provide assistance within its own capacity for [North Korea] in the fight against Covid-19”.
On Friday, North Korean state media reported that Mr Kim had sent a verbal message to the president that “congratulated him, highly appreciating that he is seizing a chance of victory in the war against the unprecedented epidemic”.
Image copyright REUTERSImage caption Kim Jong-un disappeared from public view for 20 days, before visiting a factory on 2 May
Mr Kim recently went 20 days without appearing in public, and missed the celebration of his grandfather’s birthday – one of the biggest events of the year.
Some media reports claimed he was “gravely ill”, or even dead.
But he then appeared at a fertiliser factory on 2 May – apparently in good health.
On Wednesday, South Korea’s National Intelligence Service told a parliamentary committee that there had been no signs the health rumours were true.
“He was performing his duties normally when he was out of the public eye,” a member of the committee, Kim Byung-kee, told reporters afterwards.
The lawmaker said the North Korean leader’s absence could have been down to a Covid-19 outbreak that the authorities in Pyongyang had not reported.
Analysis
By Celia Hatton, Asia Pacific Editor, BBC World Service
For months, North Korea-watchers have questioned Pyongyang’s claims that it has managed to isolate itself from Covid-19.
Admittedly, North Korea was the first country to suspend travel in response to the virus. There are unconfirmed reports that North Korean guards have been ordered to shoot at those who try to cross the lengthy border the North shares with China. However, it will be difficult to completely seal that dividing line for long. North Korea’s underground economy relies on illicit trade with Chinese entrepreneurs.
Beijing has a few good reasons for wanting to help North Korea. On a practical level, China needs to suppress a possible Covid-19 outbreak there if it wants to keep its own population healthy. Beijing also worries about what might happen inside North Korea if the virus takes hold. The North’s decrepit health system would quickly be overwhelmed by an outbreak of Covid-19, and that could threaten the fragile Kim Jong-un regime. Beijing has been Pyongyang’s biggest aid donor for decades, and it will continue to do what it can to keep Mr Kim in power. The alternatives to Kim Jong-un are much riskier for China, which does not want change on its doorstep.
China’s global political interests are also at play. Diplomatically, Mr Xi’s public exchange with Kim Jong-un underlines the seemingly close ties between China and North Korea. Pyongyang has been slow to accept public offers of help from the United States, and peace talks with Washington have stalled. If North Korea appeared to accept Beijing’s help, China would reassert itself as North Korea’s “true” ally in a time of need.
South Korea itself reported 18 new confirmed cases of Covid-19 on Saturday.
Seventeen of them are linked to a 29-year-old man who tested positive after spending time at five nightclubs and bars in Seoul’s Itaewon leisure district last weekend, the Yonhap news agency said.
Mayor Park Won-soon ordered nightclubs, bars and hostess venues across the capital to suspend business in response.
“Carelessness can lead to an explosion in infections – we clearly realised this through the group infections seen in the Itaewon club case,” Mr Park said.
Health officials have urged people who have visited the five venues in Itaewon to self-isolate and get tested to prevent additional transmissions. At least 1,500 people signed their entry logs, according to Yonhap.
The new infections brought the nationwide total to 10,840, while the death toll remained unchanged at 256.
US President Donald Trump has described the coronavirus pandemic as the “worst attack” ever on the United States, pointing the finger at China.
Mr Trump said the outbreak had hit the US harder than the Japanese bombing of Pearl Harbor in World War Two, or the 9/11 attacks two decades ago.
His administration is weighing punitive actions against China over its early handling of the global emergency.
Beijing says the US wants to distract from its own response to the pandemic.
Since emerging in the Chinese city of Wuhan in December, the coronavirus is confirmed to have infected 1.2 million Americans, killing more than 73,000.
Speaking to reporters in the Oval Office of the White House on Wednesday, Mr Trump said: “We went through the worst attack we’ve ever had on our country, this is worst attack we’ve ever had.
“This is worse than Pearl Harbor, this is worse than the World Trade Center. There’s never been an attack like this.
“And it should have never happened. Could’ve been stopped at the source. Could’ve been stopped in China. It should’ve been stopped right at the source. And it wasn’t.”
Media caption Life for asylum seekers in lockdown on the US-Mexico border
Asked later by a reporter if he saw the pandemic as an actual act of war, Mr Trump indicated the outbreak was America’s foe, rather than China.
“I view the invisible enemy [coronavirus] as a war,” he said. “I don’t like how it got here, because it could have been stopped, but no, I view the invisible enemy like a war.”
Media caption US shopping centres re-open: ‘This is the best day ever’
Who else in Trump’s team is criticising China?
The deepening rift between Washington and Beijing was further underscored on Wednesday as Secretary of State Mike Pompeo renewed his rhetoric against China, accusing it of covering up the outbreak.
He stuck by his so far unsubstantiated charge that there is “enormous evidence” the coronavirus hatched in a Chinese laboratory, even while acknowledging there is still uncertainty about its origins.
“Those statements are both true,” America’s top diplomat told the BBC. “We don’t have certainty and there is significant evidence that it came from a lab.”
One of the most trusted US public health experts has said the best evidence indicates the virus was not made in a lab.
Dr Anthony Fauci, a member of Mr Trump’s coronavirus task force, said on Monday the illness appeared to have “evolved in nature and then jumped species”.
Why is the US blaming China?
President Trump faces a tough re-election campaign in November, but the once humming US economy – which had been his main selling point – is currently in a coronavirus-induced coma.
As Mr Trump found his management of the crisis under scrutiny, he began labelling the outbreak “the China virus”, but dropped that term last month days before speaking by phone with Chinese President Xi Jinping.
Both Mr Trump and his likely Democratic challenger, Joe Biden, appear to be fastening on to China’s unpopularity as an election issue, with each accusing the other of being a patsy for America’s primary economic competitor.
As the coronavirus began spreading in the US back in January, Mr Trump signed phase one of a trade deal with China that called a truce in their tariff war. The US president’s hopes of sealing a more comprehensive phase two deal are now in limbo because of the pandemic.
MADRID, May 3 (Xinhua) — A Boeing 777 plane carrying 56 tons of sanitary material from China for Community of Madrid, one of the 17 autonomous communities of Spain, landed at Madrid-Barajas Airport late on Saturday night, the regional government has informed.
Among the equipment on the aircraft, which came from Shanghai, were 315 multi-parameter monitors, which are used in intensive care units.
The material was shipped to Pavilion 10 at the IFEMA exhibition center in Madrid, which is being used as a warehouse for sanitary equipment during the ongoing coronavirus crisis, and will subsequently be distributed among the region’s hospitals.
Saturday’s arrival was the sixth shipment of sanitary material which has arrived in Madrid from China since April 2, bringing a total of 18 million items, such as facemasks, protective gowns and shoe coverings.
Apart from the monitors, Saturday’s arrival contained 1.5 million face masks (including 560,000 FFP2 masks), 560,000 gloves and 158,000 protective gowns.
Madrid is the worst-hit region of Spain by the pandemic with over 62,000 confirmed cases of COVID-19 and 8,332 deaths.
Defence spending could show the effect of economic headwinds but is still expected to increase
PLA’s modernisation and strategic priorities demand spending is maintained even after GDP’s first contraction since records began, observers say
China has made modernising its military and expanding its weaponry a priority. Photo: Xinhua
China’s upcoming defence budget will be only slightly hit by the economic downturn that followed the coronavirus outbreak, and a modest increase is still expected as it continues to develop its military capability, analysts said.
The government’s military budget is expected to be revealed, as is the norm, at this year’s session of the National People’s Congress (NPC), China’s legislative body. Delayed by over two months because of the pandemic, it will finally be convened on May 22.
Last year the defence expenditure announced at the NPC session was
China has said its military expenditure has always been kept below 2 per cent of its GDP over the past 30 years, although its official figures have long been described by Western observers as opaque, with significant omissions of important items.
The South China Sea dispute explained
In a report earlier this week, the Stockholm International Peace Research Institute estimated that China’s actual military spending in 2019 was US$261 billion, the world’s second highest, after the United States’ US$732 billion.
John Lee, adjunct professor at the University of Sydney and senior fellow at the Hudson Institute in Washington, estimated that this year the Chinese defence budget would remain roughly the same or increase modestly, in line with growth levels of recent years.
“In the current environment, Beijing is keen to emphasise that China has recovered substantially from Covid-19 and that its power trajectory is unaffected by recent events,” Lee said. “At the same time, it would be aware of the anger towards the Communist Party for allowing the virus to become a pandemic.
“Regardless of what the reality might be, I would be surprised if there were a dramatic increase or a significant cut.”
First made-in-China aircraft carrier, the Shandong, enters service
China’s GDP suffered a 6.8 per cent decline in the first quarter, the first contraction since quarterly records began in 1992, after an extensive shutdown while it contained its coronavirus outbreak. However, the official increases in the military budget have since 2011 always exceeded overall GDP growth.
The Chinese government may focus more on job creation, social welfare and poverty alleviation, but not at the expense of military investment, according to Collin Koh, research fellow from the S Rajaratnam School of International Studies at Singapore’s Nanyang Technological University in Singapore.
“I tend to think it will be more or less the same,” Koh said. “To reduce [the budget] may send the wrong signal to would-be adversaries, both domestic and external: that Beijing has lost the will to keep up its military modernisation to assert core national interests.”
PLA flexes military muscle near Taiwan ‘in show of Covid-19 control’
15 Apr 2020
The People’s Liberation Army (PLA) began a massive – and costly – reform in 2015, with a personnel reshuffle, change in structure, upgraded equipment and enhanced training to better resemble battle scenarios. That was supposed to be complete this year.
Given the deteriorating relationship with the United States and rising tensions in the Taiwan Strait and South China Sea, the PLA faces challenges requiring a steady increase in investment, according to Hong Kong-based military commentator Song Zhongping.
Taiwan shows off its military power after presidential election
Macau-based military expert Antony Wong Dong predicted there would still be about 6-7 per cent growth in the budget “no matter what”.
“The PLA played an important role in the fight against the contagion, so a decrease in spending would not be accepted,” Wong said.
That role included the deployment of more than 4,000 military medics to help treat Covid-19 patients, and helping to transport medical supplies.
Wong said it would be a crucial year for the PLA in completing its preparation for potential military action against Taiwan, which would be so strategically important that “[President] Xi Jinping himself would never allow it to be affected by a shortage of funding”.
China’s military draws on 6G dream to modernise its fighting forces
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But a slight increase in budget would be sufficient to meet defence needs and maintain a deterrence against potential threats, including preventing self-ruled Taiwan taking the opportunity to declare independence, naval expert Li Jie said.
Beijing views Taiwan as a breakaway province to be reunified with the mainland, by force if necessary. Its relationship with Taipei has been strained, and dialogue halted, since Tsai Ing-wen, of the pro-independence Democratic Progressive Party, was elected the island’s president in 2016. Tsai was re-elected for a second term in January.
Li estimated that the budget would probably be kept at the same level or show a “slight” increase from last year.
“It would feed the ‘China threat’ theory and raise international concerns if the Chinese government expands military spending too much,” he said.
BEIJING, May 2 (Xinhua) — The number of China-Europe freight trains hit a record monthly high of 979 in April, up 46 percent year on year, the China State Railway Group said Saturday.
A total of 88,000 TEUs (20-foot equivalent units) of cargo were transported by the trains, up 50 percent from a year earlier.
From January to April, a total of 2,920 China-Europe freight trains transported cargo of 262,000 TEUs, up 24 percent and 27 percent from a year earlier, respectively.
The number of departing trains rose 36 percent year on year to 1,638 during the first four months, while the number of returning trains climbed 11 percent to 1,282.
China-Europe cargo train services have become an important logistics channel to ensure smooth trade as air, sea and road transportation have been severely affected by the novel coronavirus epidemic, the company said.
The freight trains have also been playing a crucial role in helping with the fight against the pandemic in Europe as massive quantities of medical supplies were sent by them.
From March 21 to the end of April, anti-epidemic supplies totaling 660,000 items and weighing 3,142 tonnes were sent by the freight trains to European countries such as Italy, Germany, Spain and the Czech Republic.
European nations are divided over how best to deal with Beijing, which looms larger in their policy and public debates
Think tanks came together and reported on China’s much-touted medical aid and ‘mask diplomacy’ during Covid-19 crisis
European nations are looking to be more cohesive in their approach towards relations with China. Photo: Bloomberg
As Beijing steps up its pressure campaign on Europe in the wake of the Covid-19 pandemic, their relations look set to become more diverse and contested amid growing distrust and wariness of China’s expanding influence, according to new research.
The study, based on analysis of China’s role in 19 European countries’ handling of the coronavirus crisis, showed that Europe remained largely divided over how to deal with Beijing, which has figured ever more prominently in policy and public debates in many parts of the continent.
A total of 28 experts from 21 think tanks across the continent, collectively known as the European Think-tank Network on China, were involved in the research.
It came on the heels of a diplomatic debacle in the past week that saw the European Union reportedly bowing to pressure by China. The EU reportedly toned down part of a report documenting Beijing’s disinformation efforts to deflect the blame and rewrite the global coronavirus narrative.
Although a spokesperson for the EU denied those allegations, the saga has “moreover revealed the pressures that China has placed on
officials during the crisis”, according to John Seaman, editor of the report and a research fellow at the French Institute of International Relations.
In a phone call on Wednesday, Chinese Premier Li Keqiang and European Commission President Ursula von der Leyen shrugged off concerns about their discord and vowed to boost the fight against the virus and boost economic recovery, according to Xinhua.
Germany ‘rejected China’s bid for positive spin’ on pandemic response
27 Apr 2020
According to Seaman, the Covid-19 crisis hit at a time when traditionally trade-driven China-EU relations had grown more complex and competitive after the European Commission said for the first time last year that Beijing was a systemic rival.
“Debates over the need to adopt more coherent strategies towards China have been emerging across Europe. In many ways, the current crisis has become a catalyst for a number of trends that have been shaping Europe-China relations in recent years, while in other ways it has turned the tables,” he said in the report.
“It has simultaneously brought Europe and China into closer cooperation, pushed them further apart, and seemingly underlined the fractures that exist within Europe on how to approach an increasingly influential China.”
A growing number of European countries, including Sweden and Britain, have joined the United States and Australia in calling for an international inquiry into China’s handling of the pandemic. Leaders from Germany and France have also pressed Beijing for greater transparency about the origin of the deadly virus.
The European think tanks’ report was also focused on China’s unusually aggressive coronavirus diplomacy, with Chinese embassies and ambassadors shifting the blame on to Western democracies and promoting Beijing’s messaging “with varying degrees of dogmatism, divisiveness and moderation” on Twitter and in traditional media.
“While China’s increasingly proactive public diplomacy is widespread, and there appears to be a relative degree of consistency in messaging, there is a diversity in method that ranges from low key (Latvia or Romania) to charm offensive (Poland, Portugal, Italy or Spain) to provocative or aggressive (Sweden, Germany or France),” the report said.
It examined China’s much-touted medical aid and “mask diplomacy” and found “a correlation between Chinese companies with commercial interests in the country and donations from these companies” in countries including Greece, Hungary, Italy, Portugal and Spain.
Boxes of medical supplies from China in Rome. Some European nations are growing wary about China’s diplomatic overreach and apparent willingness to alter the coronavirus narrative. Photo: Xinhua
Many countries have pushed back against China’s diplomatic overreach and its preferred narrative that has served to “[underline] the apparent successes of its autocratic governance model, ignoring its clear downfalls in managing the crisis initially, while sowing doubt on the effectiveness of liberal democracies”, according to Seaman.
While the European Union’s foreign policy chief Josep Borrell warned of Beijing’s geopolitical game to expand its influence through spinning and “politics of generosity”, countries such as Germany and Sweden have moved to tighten investment screening, 5G and industrial policies targeting Chinese firms.
Zhang Ming, China’s top envoy to the EU, last week dismissed the concerns about China’s alleged ploy to use the vulnerabilities of other countries to advance China’s geopolitical interests, such as with the country’s embattled tech giant Huawei and the ambitious Belt and Road Initiative.
“Disinformation is our common enemy and we need to make joint efforts to eradicate it,” Zhang said, claiming China had been a victim of unspecified disinformation campaigns.
The report also noted that China’s actions towards Europe in times of crisis looked set to amplify the fractures across the continent and prompt further debates about the need for a coherent EU strategy on China.
A poll of more than 12,000 people across the 28 EU member countries by German think tank Bertelsmann Stiftung in September last year showed 45 per cent of Europeans saw China as a competitor while only 9 per cent believed their countries shared the same political interests or values with China.
Another survey of 16 European countries released by the Pew Research Centre in December also showed the continent remained deeply divided over how to approach China.
While people in most of western Europe and some of Central and Eastern Europe, such as Slovak and Czech, saw China negatively, 51 per cent in Greece had a positive view of China and those in Russia, Ukraine, Poland, Bulgaria and Lithuania tended to see China more favourably.
Outbound flights from Beijing were 15 times higher on one travel site within half an hour of Beijing relaxing quarantine requirements on the city
The rebound in bookings spells some hope for online travel providers in China as the country emerges from a pandemic which saw widespread travel restrictions
Passengers arrive from a domestic flight at Beijing Capital Airport on March 27, 2020. Photo: AFP
Within an hour of Beijing downgrading its emergency response level, relaxing quarantine requirements for some arrivals to the Chinese capital city, travel bookings on some sites surged up to 15 times.
Thirty minutes after the announcement on Wednesday, bookings for outbound flights from Beijing were 15 times higher than before the announcement on Qunar, one of the biggest online travel service providers in China. Searches for travel packages and hotel bookings on the platform also increased three-fold, according to a Qunar report.
On Alibaba Group Holding‘s Fliggy travel platform, bookings for flight and trains heading in and out of Beijing increased 500 per cent and 300 per cent respectively one hour after the announcement, compared to the same time a day ago, according to a Fliggy report. Alibaba owns the South China Morning Post.
Bookings for flight and train tickets in Beijing for the upcoming Labour Day long weekend also increased more than 300 per cent and 160 per cent respectively on Chinese group buying site Meituan Dianping on Wednesday after the announcement compared to the day before, while searches for the attractions in the Beijing area on the platform increased almost three times from a week ago, according to Meituan.
“The surge in searches for travel in Beijing was because the lockdown measures in the city were the strictest in the country after work resumed,” said Jiang Xinwei, senior analyst with Analysys. “Consumption among residents was suppressed [during the lockdowns], so there is now a rebound in bookings.”
China’s online travel sites prepare for surge in domestic tourism
21 Mar 2020
The rebound in bookings spells some hope for online travel providers in China as the country gradually emerges from a pandemic which the Chinese government responded to by implementing strict quarantine measures, shutting down tourist attractions and suspending group tours.
Beijing-based consultancy Analysys estimates that China’s national tourism economy lost at least 10 billion yuan (US$1.4 billion) a day on average during the outbreak, with travel service providers like Qunar and Ctrip overloaded with millions of booking changes as well as cancellation and refund requests.
The relaxation of travel restrictions in and out of Beijing also comes ahead of a
, which starts on Friday and is the first extended public holiday after Lunar New Year in late January.
In November, the Chinese government lengthened the holiday from the original three days to five to stimulate consumption and encourage travelling amid a slowing economy weighed down by the US-China trade war.
Some cities, such as Huzhou in eastern China’s Zhejiang province and Kunming in southwestern province Yunnan, have issued travel vouchers to stimulate consumption for the tourist industry, according to the Ministry of Culture and Tourism.
Ctrip estimated that there would be more than 86 million domestic tourists during the long weekend – more than double the number of travellers seen during the Ching Ming Festival in April, which recorded 43 million tourists, according to the China Tourism Academy.
However, Jiang said the rebound this week does not mean the Chinese travel industry is out of the red. “The travel industry will recover partially during the public holiday, but this will not be more than 60 per cent [of levels before the pandemic],” he said. “The government needs to do more to signal that travelling is safe and encourage residents to do so.”
BEIJING/SHANGHAI (Reuters) – China’s biggest listed banks posted higher profits in the first quarter despite the wider impact of the coronavirus pandemic on the economy, though margins shrank.
The world’s largest commercial lender Industrial and Commercial Bank of China Ltd (ICBC) (601398.SS)(1398.HK) on Tuesday reported a 3.04% rise in first quarter net profit compared to a year earlier, while Bank of Communications Co Ltd (BoCom) (601328.SS)(3328.HK) reported a 1.8% rise.
Meanwhile at Agricultural Bank of China Ltd (AgBank) (1288.HK)(601288.SS) and China Construction Bank Ltd (CCB) (601939.SS)(0939.HK), first quarter net profit rose 4.79% and 5% respectively from the same period last year.
Following suit, Bank of China Ltd (BOC) (601988.SS) (3988.HK) posted on Wednesday a 3.17% rise in first-quarter net profit.
The growth came despite China’s economy posting the first quarterly contraction since at least 1992 due to the coronavirus pandemic. The government restricted people from travelling and going back to work to contain the spread of the virus, reducing revenue for companies and income for residents.
China’s largest banks are historically more resilient than their smaller kin, as they lend more to state-backed enterprises and have larger capital reserves.
However, despite this firmer base, net interest margins shrank at four of the five lenders, as loan prime rate reform and looser monetary policy weighed, said analysts.
AgBank did not report its net interest margin, the difference between what banks pay on deposits and earn on loans.
SOURED DEBT
ICBC, AgBank and CCB bucked the trend of the wider banking sector by posting steady non-performing loan (NPL) ratios.
The banking sector’s NPL ratio climbed in the first quarter to 2.04%, the banking and insurance regulator said, the highest level since the global financial crisis.
The rise came despite Chinese regulators moving to give banks leeway, allowing them to postpone some loan repayments until the end of June, as credit card and mortgage defaults surged.
About one-third of Chinese bank loans are to sectors including transport and retail that are significantly stressed by the pandemic, according to S&P Global.
“You can see generally from banks’ results that some lenders have reported falling asset quality, the NPL ratios have risen quite a lot,” said Richard Cao, an analyst at Guotai Junan International on Monday.
The largest banks are best placed to absorb such losses with a better ability to get financing and withstand a substantial volume of bad loans, S&P said in a research note in April.
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