Archive for ‘The Wall Street Journal’

30/05/2020

US-China tensions set to worsen as moderates lose out to hardliners, observers say

  • Chinese groups calling for more ‘fighting spirit’ are getting the upper hand on those who favour calm and cooperation, government adviser says
  • From Hong Kong to Covid-19, trade to the South China Sea, Beijing and Washington are clashing on a growing number of fronts and in an increasingly aggressive way
Efforts to promote dialogue and cooperation between the US and China are failing, observers say. Photo: AFP
Efforts to promote dialogue and cooperation between the US and China are failing, observers say. Photo: AFP
Moderates who favour dialogue and cooperation as a way to resolve China’s disputes with the United States are losing ground to hardline groups bent on taking the fight to Washington, according to political insiders and observers.
“There are two camps in China,” said a former state official who now serves as a government adviser and asked not to be named.
“One is stressing the combat spirit, the other is trying to relieve tensions. And the former has the upper hand.”
Relations between China and the US are under intense pressure. After Beijing moved to introduce a national security law for Hong Kong, US President Donald Trump said on Friday that Washington would begin eliminating the special policy exemptions it grants the city, as it no longer considers it autonomous from mainland China.
Beijing’s decision to enact a national security law for Hong Kong was met with anger from the US and other Western countries. Photo: Sam Tsang
Beijing’s decision to enact a national security law for Hong Kong was met with anger from the US and other Western countries. Photo: Sam Tsang
The two nations have also clashed over trade, Xinjiang, Taiwan and the South China Sea, with the US passing several acts denouncing Beijing and sanctioning Chinese officials.
China has also experienced turbulence in its relations with other countries, including Australia and members of the European Union, mostly related to the Covid-19 pandemic
 and Beijing’s efforts to position itself as a leader in the fight against the disease with its policy of “mask diplomacy”.

After Canberra appealed for an independent investigation to be carried out to determine the origins of the coronavirus, Beijing responded by imposing tariffs on imports of Australian barley, showing it is prepared to do more than just trade insults and accusations with its adversaries.

Pang Zhongying, a professor of international relations at Ocean University of China in Qingdao, said there was a worrying trend in China’s relations with other nations.

“We need political and diplomatic means to resolve the challenges we are facing, but … diplomatic methods have become undiplomatic,” he said.

“There are some who believe that problems can be solved through tough gestures, but this will never work. Without diplomacy, problems become confrontations.”

Chinese Foreign Minister Wang Yi

said during his annual press conference on the sidelines of the National People’s Congress last weekend that China and the United States must work together to prevent a new Cold War.

His words were echoed by Chinese Premier Li Keqiang, who said during a press conference after the closure of the legislative session on Thursday that the many challenges facing the China-US relations could only be resolved through cooperation.

However, the government adviser said there was often quite a chasm between what China’s leaders said and what happened in reality.

“Even though we say we do not want a Cold War, what is happening at the working level seems to be different.” he said. “The implementation of policies is not properly coordinated and often chaotic.”

Tensions between China and the US have been in a poor state since the start of a trade war almost two years ago. After multiple rounds of negotiations, the sides in January signed a phase one deal, but the positivity that created was short-lived.

In February, Beijing expelled three reporters from The Wall Street Journal over an article it deemed racist, while Washington has ramped up its military activity in the South China Sea and Taiwan Strait, and threatened to revoke the visas of Chinese students studying science and technology in the US over concerns they might be engaged in espionage.

Beijing has also used its state media and army of “Wolf Warrior” diplomats to promote its narrative, though many Chinese scholars and foreign policy advisers have said the latter’s nationalistic fervour has done more harm than good and appealed to Beijing to adopt a more conciliatory tone.
However, Hu Xijin, editor-in-chief of Chinese tabloid Global Times, said China had no option but to stare down the US, which regarded the world’s most populous nation as its main rival.
“Being contained by the US is too high a price for China to pay,” he said. “I think the best thing people can do is forget the old days of China-US ties”.

Jin Canrong, a professor of international relations at Renmin University in Beijing, wrote in a recent newspaper article that Beijing’s actions – notably enacting a national security law for Hong Kong – showed it was uncompromising and ready to stand its ground against the US.

Wu Xinbo, dean of international studies at Fudan University in Shanghai, agreed, saying relations between the two countries were likely to worsen in the run-up to the US presidential election in November and that Beijing should be prepared for a fight.

But Adam Ni, director of China Policy Centre, a think tank in Canberra, said the issue was not that the moderate camp had been sidelined, but rather Beijing’s perception of the US had changed.

“Beijing has woken up to the idea that America’s tough policy on China will continue and it is expecting an escalation of the tensions,” he said.

“The centre of gravity in terms of Beijing’s perception of the US has shifted, in the same way the US perception of China has shifted towards a more negative image”.

Beijing was simply responding in kind to the hardline, assertive manner of the US, he said.

Source: SCMP

18/03/2020

China to restrict US journalists from three major newspapers

US newspapersImage copyright GETTY IMAGES

China has effectively expelled journalists from three US newspapers in retaliation for restrictions on its news outlets in the US.

Its foreign ministry ordered reporters from the New York Times, the Washington Post and the Wall Street Journal to return media passes within 10 days.

The ministry also demanded information about their operations in China.

The measures were in response to “unwarranted restrictions on Chinese media agencies” in the US, it said.

China’s action also prohibits the newspapers’ journalists from working in the semi-autonomous regions of Hong Kong and Macau, where there is greater press freedom than on the mainland.

Earlier this month, the Trump administration imposed limits on the number of Chinese citizens who could work as journalists in the US – the latest move in a tit-for-tat row over press freedoms.

“What the US has done is exclusively targeting Chinese media organisations, and hence driven by a Cold War mentality and ideological bias,” China’s foreign ministry said in a statement on Tuesday.

US Secretary of State Mike Pompeo urged Beijing to reconsider its decision, calling the move “unfortunate”.

“I regret China’s decision today to further foreclose the world’s ability to conduct the free press operations that, frankly, would be really good for the Chinese people in these incredibly challenging global times, where more information, more transparency are what will save lives,” Mr Pompeo said.

Presentational grey line

Great loss for Chinese journalism

Zhaoyin Feng, BBC Chinese

All foreign correspondents in China are required to renew their press credentials annually, which usually happens at the year end.

This means most American reporters of the three US major publications have an expiring visa and will need to leave China under the new rules. We don’t know the exact number of affected journalists yet, but it’s believed to be close to a dozen.

The expulsions will lead to a major personnel loss in these three media organisations’ China operation, especially for the Wall Street Journal, which had already seen three reporters expelled from China last month.

Critics say it’s an even greater loss for China, as the draconian measures come at a time when the country and the rest of the world need high-quality journalism on China more than ever.

It’s still unclear whether the US publications can send new correspondents, American citizens or not, to fill in the positions in China.

In the midst of a dangerous pandemic, the world’s two superpowers are locked in an escalating war with multiple fronts. By fighting over media, the origin of the coronavirus, and technology and trade, the US and China are competing to prove the superiority of their own political model.

Presentational grey line

At the beginning of March, the US state department said five media outlets, including China’s official news agency Xinhua, would be required to reduce their total number of staff to 100 from 160.

The move was seen as retaliation for China’s expulsion of two US journalists for the Wall Street Journal over a coronavirus editorial in February.

The row over media access is the latest episode in an increasingly acrimonious dispute between China and the US.

Disagreements over trade, intellectual property rights and 5G networks have damaged relations in recent years.

The coronavirus pandemic has been a source of tension too, with Washington and Beijing both accusing each other of spreading misinformation.

On Tuesday, US President Donald Trump angered China by referring to the coronavirus as “Chinese”.

A foreign ministry spokesman accused the US of stigmatising China, where the first cases of Covid-19 were recorded in the city of Wuhan in late 2019.

However, last week a Chinese foreign ministry spokesman shared a conspiracy theory, alleging the US Army had brought it to the region.

The unfounded accusation led Mr Pompeo to demand China stop spreading “disinformation” as it tried “to shift blame” for the outbreak.

Source: The BBC

27/12/2019

US-China tech war’s new battleground: undersea internet cables

  • A push to connect Pacific nations highlights a submarine struggle for dominance over the world’s technology infrastructure
  • The ambitions of Chinese tech giants like Huawei, which have laid thousands of kilometres of cable, are of increasing concern to Washington
The ambitions of Chinese tech giants like Huawei, which have laid thousands of kilometres of cable, are of increasing concern to Washington. Photo: Reuters
The ambitions of Chinese tech giants like Huawei, which have laid thousands of kilometres of cable, are of increasing concern to Washington. Photo: Reuters
In the contest between the US and China for dominance over the world’s technology
infrastructure, the latest battle is taking place under the Pacific Ocean.
While the US has been upping the pressure on its allies not to include equipment made by Chinese telecom giants like Huawei and ZTE in their 5G systems, Chinese companies have gained a foothold in some of the world’s most essential communications infrastructure – undersea internet cables.
Smart telecom cables: climate change hope or submarine spying tech?
14 Dec 2019
Almost all global data communications flow through cables under the ocean – just one per cent travels by satellite – and Chinese companies have quietly been eroding US, European and Japanese dominance over the backbone of the internet, the undersea cable market. Now, they have trained their sights on connecting one of the most virtually remote parts of the globe, the Pacific Island countries.
Of the 378 cables currently operating worldwide, 23 are under the Pacific. But many of these cables run right by Pacific Island nations on their paths between hubs in Los Angeles, Tokyo and Singapore.
An electric submarine cable and optical fibre. File photo
An electric submarine cable and optical fibre. File photo
Despite the volume of data flowing under the Pacific Ocean, just half a million of the 11 million people living in Pacific Island countries and Papua New Guinea – less than five per cent – have access to a wired internet connection and only 1.5 million to a mobile connection, according to the United Nations Economic and Social Commission for the Asia Pacific (UNESCAP), compared with 53 per cent of people in Thailand and 60 per cent in the Philippines.

More than US$4 billion worth of cables are to come into service by 2021, continuing a trend in which US$2 billion worth of cables have come online every year since 2016, and six of these cables will connect Pacific Island countries.

The push to connect Pacific Island nations to the latest generation of internet infrastructure has received extra scrutiny from the US and its allies like Australia
over the involvement of Chinese tech companies.
Choose Beijing over Taipei, Solomon Islands task force recommends
13 Sep 2019

SECURITY CONCERNS

While the US has moved to block Huawei from supplying equipment to its allies’ 5G networks, experts say Chinese tech companies could contest the US, EU and

Japan’s

long-standing dominance over global data traffic through investments in subsea cables.

Chinese tech giants like Huawei have entire divisions devoted to undersea connectivity that have laid thousands of kilometres of cable, and Chinese state telecommunication companies such as China Unicom have access to many of the existing trans-Pacific cables.

But a panel led by the US Department of Justice has held up a nearly complete trans-Pacific cable project over concerns about its Chinese investor, Beijing-based Dr Peng Telecom & Media Group.

The project, the Pacific Light Cable Network, could be the first cable rejected by the panel on the grounds of national security – despite being backed by American tech giants Google and Facebook – setting a precedent for a tougher US stance on Chinese involvement in subsea cables.
Chinese tech giants like Huawei have entire divisions devoted to undersea connectivity that have laid thousands of kilometres of cable. Photo: AP
Chinese tech giants like Huawei have entire divisions devoted to undersea connectivity that have laid thousands of kilometres of cable. Photo: AP
Craige Sloots, director of sales at Southern Cross Cable Network, which operates the largest existing sets of trans-Pacific cables, said for any new cable, regulators were likely to scrutinise the ownership of the companies involved and the maker of the project’s equipment.
These two factors, said Sloots, “pragmatically limit some of the providers you can use if you want to connect through the US”.
Experts say that Hong Kong, where the stalled Pacific Light Cable would land, was previously considered a more secure shore landing point than mainland China. But people close to the project say the recent unrest in the city has made this distinction less relevant, according to The Wall Street Journal.

If these nations want to be part of the international economy, they need reliable communications: Bruce Howe, University of Hawaii

Similar concerns caused a proposed Huawei-backed cable linking Vanuatu with Papua New Guinea to be called off last year after Australia stepped in to fund its own cable instead.
Just months after the government-owned Solomon Islands Submarine Cable Company agreed to the project with Huawei in mid-2017, Canberra put up US$67 million to connect Sydney with the Solomon Islands and Papua New Guinea with cables laid under the Coral Sea by Nokia’s Alcatel Submarine Networks.
Simon Fletcher, CEO of Vanuatu company Interchange, which had been planning another cable in the neighbourhood connecting Vanuatu with the Solomon Islands, said the Coral Sea project undercut the viability for small private businesses to operate in the fledgling market, where services had historically been provided by international organisations like development banks. His company’s cable has been on pause since the announcement of the Coral Sea project, though Fletcher said it would go forward next year.
US-China battle for dominance extends across Pacific, above and below the sea
22 Jul 2019

VIRTUALLY REMOTE

For years, as Japan, Hong Kong and Singapore became global hubs of high-speed internet data traffic, the cables criss-crossing the ocean floor passed by just off the shores of Pacific Island countries en route between hubs on either side of the ocean.

Tiziana Bonapace, director of UNESCAP’s information technology and disaster risk-reduction division, said the Pacific Islands remain one of the most disconnected areas in the world, where “a vast proportion of the population has no access to the internet”.

Over the past five years, international organisations like UNESCAP, the Asia Development Bank and the World Bank have been pushing for better connectivity in the region. The World Bank’s Pacific Regional Connectivity Programme has invested more than US$90 million into broadband infrastructure for Fiji, the Federated States of Micronesia, Kiribati, the Marshall Islands, Palau, Samoa and Tuvalu.

Internet cables in the Pacific Ocean.
Internet cables in the Pacific Ocean.
But the business case had never been good, said Bonapace.
“A cable has to travel thousands of kilometres just to connect a population smaller than one of Asia’s megacities,” she said. “As everything we do is somehow connected to the internet, the prospects for the Pacific to become virtually more remote are even higher.”
Even nations which are connected have tenuous infrastructure. In January, Tonga experienced a total internet blackout for two weeks after damage to its single cable. Most parts of the world were linked by multiple cables to prevent this type of outage, said Bruce Howe, professor of ocean and resources engineering at University of Hawaii.
“If these nations want to be part of the international economy, they need reliable communications,” Howe said.
Is Chinese support for Pacific nations shaping their stance on West Papua?
26 Aug 2019

DRAWING NEW LINES

In Papua New Guinea, where mobile internet currently reaches less than a third of the population, a partnership between local telecoms company GoPNG and the Export-Import Bank of China funded the new Huawei-built Kumul Domestic cable system, which came online this year.

The Southern Cross Next system, owned by Spark, Verizon, Singtel Optus and Telstra – the same group of shareholders which operates the massive 30,500km (19,000 mile) set of twin cables connecting the US with Australia and New Zealand known as Southern Cross – is planned to come online in 2022, and will connect directly to Fiji, Samoa, Kiribati and Tokelau.

Chinese telecoms company China Unicom counts the existing Southern Cross cables among its network capabilities – meaning it is likely to have access to the cable through a leasing agreement with one of the other companies that uses the cable, according to Canberra think tank the Australian Strategic Policy Institute (ASPI).

An undersea fibre optic cable. Photo: AFP
An undersea fibre optic cable. Photo: AFP
China Unicom and China Telecom also list the Asia America Gateway Cable System as one of their network capabilities, according to ASPI. The 20,000km (12,400-mile) cable came online in 2009 and connects the US, Guam, Hong Kong, Brunei, the Philippines, Singapore, Malaysia, Vietnam and Thailand.
It is owned by a consortium of carriers including AT&T, Telekom Malaysia, Telstra and Spark.
A cable backed by Google and the Australian Academic and Research Network connecting Japan and Australia through Guam is to come online early next year.
China: the real reason Australia’s pumping cash into the Pacific?
28 Jul 2018

WHAT’S NEXT

Natasha Beschorner, senior digital development specialist at the World Bank, said that while there were challenges ahead in terms of broadband access and affordability, increased connectivity was starting to bring new opportunities to the Pacific.

“Digital technologies can contribute to economic diversification, income generation and service delivery in the Pacific,” Beschorner said. “E-commerce and financial technologies are emerging and governments are considering how to roll out selected services online.”

Experts say the industry has recently seen a switch from cables being mostly funded by telecommunication carriers to being funded by content providers, like Google and Facebook. Members of the private cable industry say content companies can afford to invest in cable infrastructure to ensure the supply chain for their customers, but that the competition puts the squeeze on the research-and-development budgets of other types of companies.

Sloots at Southern Cross predicted that the nations which connected directly to the massive next-generation cable – Samoa, Kiribati and Tokelau – would be able to function as connecting points for intra-Pacific cables.

“There’s a blossoming effect in capability once certain islands are connected,” Sloots said.

There is also the push to locate an exchange point within the Pacific so that internet data no longer has to travel to a hub in Tokyo or Los Angeles and back to Pacific nations when processing – a move that could ultimately lower the cost of broadband internet service for consumers in the Pacific.

Perhaps the most effective outcome could be for Pacific nations to cut the cord and receive their internet by satellite.

The Asian Development Bank has agreed to give a US$50 million loan to Singapore’s Kacific Broadband Satellites International to provide up to two billion people across the Asia-Pacific region with affordable satellite-based internet.

The project is to be launched into orbit by SpaceX next week and aims to begin providing service by early next year.

Source: SCMP

13/11/2019

Xinjiang cotton sparks concern over ‘forced labour’ claims

Farmers pick cotton during the harvest on October 21, 2019 in Shaya County, Xinjiang Uygur Autonomous Region of China.Image copyright GETTY IMAGES

Global retailers are facing scrutiny over cotton supplies sourced from Xinjiang, a Chinese region plagued by allegations of human rights abuses.

China is one of the world’s top cotton producers and most of its crop is grown in Xinjiang.

Rights groups say Xinjiang’s Uighur minority are being persecuted and recruited for forced labour.

Many brands are thought to indirectly source cotton products from the Xinjiang region in China’s far west.

Japanese retailers Muji and Uniqlo attracted attention recently after a report highlighted the brands used the Xinjiang-origin of their cotton as a selling point in advertisements.

H&M, Esprit and Adidas are among the firms said to be at the end of supply chains involving cotton products from Xinjiang, according to a Wall Street Journal investigation.

“You can’t be sure that you don’t have coerced labour in your supply chain if you do cotton business in China,” said Nathan Ruser, researcher at the Australian Strategic Policy Institute.

“Xinjiang labour and what is almost certainly coerced labour is very deeply entrenched into the supply chain that exists in Xinjiang.”

What is happening in Xinjiang?

UN experts and human rights groups say China is holding more than a million Uighurs and other ethnic minorities in vast detention camps.

Rights groups also say people in camps are made to learn Mandarin Chinese, swear loyalty to President Xi Jinping, and criticise or renounce their faith.

China says those people are attending “vocational training centres” which are giving them jobs and helping them integrate into Chinese society, in the name of preventing terrorism.

What is produced in Xinjiang?

The Xinjiang region is a key hub of Chinese cotton production.

China produces about 22% of global cotton supplies, according to a report by the Center for Strategic and International Studies (CSIS).

Last year, 84% of Chinese cotton came from Xinjiang, the report said.

That has raised concerns over whether forced labour has been used in the production of cotton from the region.

This photo taken on September 11, 2019 shows people walking past a mosque in Urumqi, the regional capital of Xinjiang.Image copyright GETTY IMAGES
Image caption The Uighurs are mostly Muslims, and number about 11 million in China’s Xinjiang region

Nury Turkel, chairman of the Uighur Human Rights Project in Washington, said the Uighurs were being “detained and tormented” and “swept into a vast system of forced labor” in Xinjiang.

In testimony to US congress, he said it was becoming “increasingly hard to ignore the fact” that the goods manufactured in the region have “a high likelihood” of being produced with forced labour.

Which brands use Xinjiang cotton?

Amy Lehr, director of CSIS Human Rights Initiative, said in many cases Western companies aren’t buying directly from factories in Xinjiang.

“Rather, the products may go through several stages of transformation after leaving Xinjiang before they are sent to large Western brands,” she said.

Some, like Muji, are very open about sourcing material from Xinjiang.

The Japanese retail chain launched a new Xinjiang Cotton collection earlier this year.

One of its advertisements boasts “soft and breathable” men’s shirts made from organic cotton “delicately and wholly handpicked in Xinjiang”.

Another Japanese fashion brand Uniqlo had also touted the Xinjiang region in an advertisement advertisment for men’s shirts.

In the fine print of the shirt description, the advert said the shirts were made from Xinjiang cotton, “famous for its superb quality”.

That reference was later removed from the advertisement “given the complexity of this issue”, according to a spokesperson for Uniqlo.

“Uniqlo does not have any production partners located in the Xinjiang region. Moreover, Uniqlo production partners must commit to our strict company code of conduct.

“To the best of our knowledge, this means our cotton comes only from ethical sources,” the spokesperson told the BBC.

Pedestrians walk past a Japanese household and consumer goods retailer, Muji store in ShenzhenImage copyright GETTY IMAGES

According to the Wall Street Journal report which focused on workers at a mill operated by Huafu Fashion in Aksu, Xinjiang, yarn made in the region was present in the supply chains of several international retailers including H&M, Esprit and Adidas.

Many of the companies looked into the allegations, including those without clear links to the Huafu mill.

In a statement to the BBC, Adidas said: “While we do not have a contractual relationship with Huafu Fashion Co., or any direct leverage with this business entity or its subsidiary, we are currently investigating these claims.”

“We advised our material suppliers to place no orders with Huafu until we have completed those investigations,” the Adidas spokesperson said.

Esprit, which also does not source cotton directly from Xinjiang, said it had made several inquiries earlier this year.

“We concluded that a very small amount of cotton from a Huafu factory in Xinjiang was used in a limited number of Esprit garments,” the firm said in a statement.

The company has instructed all suppliers to not source Huafu yarn from Aksu, the statement said.

H&M said it does not have “a direct or indirect business relationship” with any garment manufacturer in the Xinjiang region.

“We have an indirect business relationship with Huafu’s spinning unit in Shanyu, which is not located in the Xinjiang region, and according to our data, the vast majority of the yarn used for our garment manufacturing comes from this spinning unit,” a spokesperson for H&M said.

“Since we have an indirect business relationship with the yarn supplier Huafu, we also asked for access to their spinning facilities in Aksu. Our investigations showed no evidence of forced labor.”

Source: The BBC

24/07/2019

China’s choice of Shanghai for US trade talks emphasises commercial rather than political focus, analysts say

  • Switching first face-to-face gathering since G20 summit from Beijing sends message that ‘trade should be trade, and politics should be politics,’ analyst says
  • Trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are set to meet counterparts Vice-Premier Liu He and Commerce Minister Zhong Shan
Shanghai is China’s global financial hub, while Beijing is viewed as more of a political centre. Photo: Bloomberg
Shanghai is China’s global financial hub, while Beijing is viewed as more of a political centre. Photo: Bloomberg
China’s decision to hold next week’s negotiations with the United States in Shanghai could be a fresh sign that Beijing is revising its strategy as it prepares for a protracted trade war, analysts said.
By choosing global financial hub Shanghai rather than the political centre of Beijing, China is trying to play down the political aspects of the talks and emphasise the commercial elements, analysts suggested.
The meeting will be the first face-to-face gathering of the two countries’ trade negotiators since talks collapsed in May without a deal as the US blamed China for renegading on earlier promises, while China blamed the US for being too demanding.
The trade teams have held two phone conversations in July, although neither Washington or Beijing have confirmed the venue or schedule for the talks next week.
Shen Jianguang, the chief economist at JD Digits and a veteran Chinese economy watcher, said China is changing the location of the talks to send a message that “trade should be trade, and politics should be politics”.
He added that the choice of Shanghai implies that China is trying to focus on the technical issues such as the US relaxation of sales restrictions to 
Huawei Technologies

and China’s purchase of US farm products instead of political issues that will be more difficult to resolve.

“The Shanghai talks will only result in a small step,” Shen said.

Trade representative Robert Lighthizer

and Treasury Secretary Steven Mnuchin are expected to lead the US delegation to meet their Chinese counterparts headed by Vice-Premier Liu He and Commerce Minister Zhong Shan, the South China Morning Postreported earlier this week.

The Shanghai talks will only result in a small stepShen Jianguang

Bloomberg and The Wall Street Journal reported on Wednesday that the talks will take place in Shanghai, and a source confirmed the location to the Post. Hua Chunying, China’s foreign ministry spokeswoman, said on Wednesday that she had no information to provide on the location of the talks.
Chang Jian, chief China economist at Barclays, said that the choice of Shanghai is a sign that the initial goal of the talks would be “smaller”, focusing more on specific import and export arrangements rather than wholesale institutional changes in China’s economic model.
“It shows that China is preparing for a protracted trade talks for years to come,” Chang said. “For China, a precondition for a grand deal is that the US has to lift all tariffs, which the US will find very hard to do.”
Aidan Yao, a senior emerging Asia economist at AXA Investment Managers, said the fact that it took almost a month after the ceasefire agreement reached between President Xi Jinping and US counterpart Donald Trump at the G20 summit in Japan for a face-to-face meeting to take place is already a confirmation of “the deep divide” that remains.
“Without a clear strategy to tackle them, I doubt anyone should hold their breath for a breakthrough” despite certain goodwill gestures in recent days, Yao said.

Without a clear strategy to tackle them, I doubt anyone should hold their breath for a breakthroughAidan Yao

The initial arrangements for the meeting came after the US announced that it would offer exemptions to 110 Chinese products, including medical equipment and key electronic components, from import tariffs. China, meanwhile, said that several companies would buy American agricultural products having already applied for exemptions from the tariffs imposed by Beijing.
Liao Qun, the chief economist at China Citic Bank International, said a change of location could pump “fresh air” into the talks.

“Shanghai is the window of China’s reform and opening up and the country’s economic heart,” Liao said. “It could be a positive change”.

Larry Hu, chief China economist of Macquarie Capital, noted that Shanghai has played a unique role in US-China relations.

“The important Shanghai Communiqué was inked in the city,” Hu said, referring to the diplomatic document signed between China and US in 1972 during president Richard Nixon’s visit to China to meet Chinese chairman Mao Zedong.

The document, which is part of the Three Joint Communiqués, paved the way for Beijing and Washington to establish official diplomatic relationships later that decade.

The Three Joint Communiqués are a collection of joint statements made by the governments of the US and China from 1972, 1979 and 1982.

Source: SCMP

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