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Rightways: US Trade War
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Chinese smartphone maker Oppo unveiled its second self-developed microchip on Wednesday, a fresh effort as more
Chinese hardware companies speed up investment in the semiconductor sector amid a relentless US crackdown on the Chinese technology industry.
Beijing's 14th five-year economic plan and 2035 goal promise a new era of development for China and the greater wealth for the world.
Momentous meeting: China’s top political advisory body wrapped up its annual session recently.
— Xinhua
Review of China's achievements in 2020
US’s intention to destroy China will be a difficult process
https://youtu.be/_3tjcoudjbI
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CHINA’s most important meetings of the year – “Two Sessions” – have unveiled Beijing’s medium- and long-term economic goals and strategies that experts believe will not only boost China’s quality development and modernisation but will also benefit the world, in particular Asean.
As Malaysia is part of the 10-nation Asean, China’s biggest trading partner, it will gain from Beijing’s strategies as long as Putrajaya continues to embrace foreign policies deemed as friendly – or at least non-toxic – towards Beijing.
The “Two Sessions” or Lianghui refers to the annual meetings of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC).
The NPC is the Parliament where laws and policies are adopted, while the CPPCC is the top political consultative body comprising the Communist Party of China (CPC) and other interest groups that provide policy input for the NPC.
At the start of the NPC in Beijing on March 5, Premier Li Keqiang, while unveiling the 14th five- year plan (2021-2025), announced that China had set an economic growth target of more than 6% for 2021 – with emphasis on high-quality development, green economy, modernisation and innovation.
The GDP of China, the first country to be hit by and recover from the Covid-19 pandemic, grew by only 2.3% in 2020. Still, China was the only major economy to post growth last year.
Li also announced that China – the world’s second largest economy in the world – wants to double the size of its economy to 202 trillion yuan (RM128 trillion) in 2035, from 102 trillion yuan (RM64.5 trillion) in 2020.
Over the next five years, Beijing will aim to keep unemployment low, strive for 7% annual growth in research and development spending and forge a new development pattern.
China also aims to become an advanced manufacturing powerhouse by 2025. This involves upgrading its manufacturing capabilities in rare earth, robotics, aircraft engines, new energy vehicles, high-end medical equipment and innovative medicine, aviation, high-speed rail and industrial applications of the BeiDou satellite system.
Ultimately, China wants to reduce reliance on foreign technologies and enhance competitiveness against the United States after being trapped in a long and acrimonious US-initiated trade war.
According to a Xinhua commentary, the CPC wants to lay the foundation to transform China into “a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious and beautiful” by the middle of the 21st century.
To double its GDP, China needs to achieve an average annual growth rate of 4.7-5.0% in the next 15 years, according to estimates of economists.
Prof Justin Lin Yifu, a top economist in planning Beijing’s poverty eradication programmes, projects that China will become a high-income nation by 2025.
The dean at the Institute of New Structural Economics of Peking University told Chinese newspaper Global Times that his optimistic prognosis “is based on China’s complete industrial chain, rich industrial range and advantages in new technologies, including 5G and artificial intelligence”.
Chen Fengying, a research fellow at the China Institutes of Contemporary International Relations, told Global Times the five-year plan has taken into account risks and challenges, particularly those posed by the US and its allies that try to contain China’s rise and technology advancement.
Despite challenges ahead, Beijing has demonstrated that it is capable of achieving targets. A good example is shown in the eradication of extreme poverty in 2020, achieved on the back of economic disruption induced by Covid-19.
While China’s economic strategies aim primarily at developing domestic growth, they are seen as benefiting investors and foreign nations.
“Given the size of the Chinese economy and the important role it plays in the global economy, the 14th Plan also offers a bright spot for the global economy in this difficult time, ” Bai Ming, deputy director of the International Market Research Institute, told Global Times.
Indeed, China has contributed about 30% in global economic growth on average over the past 20 years. Within the next five to 10 years, China is expected to contribute 25-30% to global economic growth, says Gobal Times.
Christina Zhu, an economist at Moody’s Analytics, notes that Beijing plans to increase spending on fundamental research by 10.6% this year and encourages manufacturers to invest in research and development by offering greater tax benefits.
“China will further open up its domestic market to foreign businesses and investors. It has lifted restrictions in areas such as high-end manufacturing, new energy and service industries, and has committed to trimming down the negative list and providing a level playing field for foreign enterprises, ” she writes in a note.
Foreign trade stability and growth in foreign investment are critical to China’s ambition for greater connectivity with the world economy, she adds in the note also issued to Sunday Star.
Judging from what China’s Foreign Minister Wang Yi has said, Malaysia and its Asean neighbours can expect to enjoy preferential treatment from China.
Last Sunday, Wang Yi told a press conference: “China is willing to work with Asean to build an even closer community with a shared future and another 30 years of even greater cooperation.
“In the new development stage, China is like an express train with greater driving force and load capacity. China welcomes all countries to get on board and move towards a future of shared prosperity.”
Locally, the Associated Chinese Chamber of Commerce and Industry of Malaysia (ACCCIM) sees Asean becoming a strong beneficiary of Beijing’s economic plan and goals.
“With China regaining its strong growth momentum in 2021, its economic strategies will help to support Malaysia and Asean’s economic recovery from the pandemic, ” says Tan Sri Ter Leong Yap, president of ACCCIM.
The trade group sees China as intensifying external connectivity via the Belt and Road Initiative (BRI) of President Xi Jinping to accelerate China’s involvement in international trade.
Touching on Malaysia, ACCCIM notes that China has become Malaysia’s largest trading partner for the 12th consecutive year in 2020, with total trade valued at RM329.8bil or 18.6% of Malaysia’s total trade. Exports to China accounted for 16.2% while imports from China stood at 21.5%.
In 2020, China’s investment in Malaysia jumped 43.8% to RM5.8bil to become Malaysia’s sixth largest foreign investor.
“China’s long-term sustainable economic growth and greater emphasis on quality and technology-driven investment will open up more trade and investment cooperation in the areas that can help Malaysia’s industrial development.
“China’s signature BRI can continue to be a catalyst to spur more China investment to Malaysia and Asean, ” Ter tells Sunday Star.
The growing influence of China on the global stage will boost China-Asean economic cooperation, which can be further cemented by the signing of the 15-member Regional Comprehensive Economic Partnership (RCEP), he adds.
Malaysia’s development focus on IR 4.0, digitalisation, 5-G technology, e-commerce, green investment, renewable energy, electric cars and smart transport infrastructure also means that both nations can work together to foster win-win deals.
Ter opines: “Malaysia can learn a lot from China in high technology, digitalisation, agri-tech and the building of smart and eco-industrial parks.
“We hope that the Prime Minister’s planned visit to China could further strengthen bilateral relations, taking it to a new level of win-win partnership. Both countries have come a long way in deepening trade and investment flows, enhanced connectivity and people-people exchange.”
For Prof Datuk Dr Chin Yew Sin, China’s BRI strategy under its 14th five-year plan could help Beijing achieve its economic targets.
“Between 2013 and 2019, China had signed with 138 counties, including Asean countries, for a total of 790 BRI projects. These overseas BRI projects undertaken by China will help spur the economic growth rate of China by about one per cent annually.
“The BRI projects implemented in Malaysia and other Asean countries will enhance the economic growth rates of these countries also, ” says Dr Chin, adviser for the Global One Belt One Road Association (Asia Pacific Region).
Dr Chin believes China’s demand for Asean’s natural produces and manufactured products will be even greater when it overtakes the US to become the largest economy in the world before 2035.
“By then, Malaysia will be able to export more of its electrical and electronic products, palm oil, rubber, oil and gas, timber products and others to China due to a higher demand of these goods.
“In addition, Malaysia will be able to attract more direct investments from China because of its long-standing good relationship with China, ” he adds.
Malaysia was the first Asean country to establish diplomatic ties with China in 1974 and Beijing has never failed to repeat its gratitude to Malaysian leaders at meetings, Dr Chin notes.
Datuk Keith Li, a mainland Chinese business leader in Malaysia, shares the views of his Malaysian counterparts.
“China will definitely focus more on the Asean market since the bloc is China’s biggest trading partner amid the pandemic. Moreover, China’s current ties with the US, Europe and Australia are tense, ” says Li, president of the China Entrepreneurs’ Association in Malaysia.
He adds: “There will be more to be done when the RCEP is implemented. China is expected to help Malaysia build a high-speed railway, an essential link with other Asean countries” Cambodia, Myanmar, Laos, Thailand and Singapore. This will also facilitate China to enhance economic cooperation with Asean in tourism, trade, logistics and communication.”
China convened its annual
legislative session on Friday and released sweeping plans and goals,
including an over 6 percent GDP growth target for 2021 and a 6.8 percent
increase in military spending, clearly displaying its resilience and
confidence in all-round ...
https://youtu.be/dYVLW5DjBjA Huawei CFO has strong arguments in extradition case: Canadian diplomat
https://youtu.be/jB_OVG3c1DI
https://youtu.be/ztu32BnhPj4
https://youtu.be/ln_asabsHLI
FM urges Canada to make right choice
China urged Canada to "make the right choice" on Thursday, after Canada's ambassador to China John McCallum reportedly said the Huawei executive arrested in Vancouver at the request of the US has a strong case to fight extradition.
"Any one with normal judgment can see the nature of the incident, and we hope the Canadian side makes the right choice and not to 'pull someone's chestnuts out of the fire,'" Foreign Ministry spokesperson Hua Chunying said at a daily briefing on Thursday.
Hua's remark comes after McCallum told reporters earlier this week that Huawei's chief finance officer Meng Wanzhou has a "strong case" to fight an extradition request.
"I think she has quite good arguments on her side," said McCallum, CNN reported.
"One, political involvement by comments from US President Donald Trump in her case. Two, there's an extraterritorial aspect to her case; and three, there's the issue of Iran sanctions which are involved in her case, and Canada did not sign on to these sanctions."
Echoing McCallum, Huang Feng, director of Beijing Normal University's Institute for International Criminal Law, noted that the US extradition request has no merit as it does not follow the basic extradition principle of double criminality.
Double criminality states that a suspect could be extradited only if similar laws one breaks exist in the extraditing country. However, Canada has no such sanctions, said Huang.
Analysts stressed that even if the US files an extradition request at the last minute, it does not mean Meng would be extradited to the US, noting that every side has to weight their choice.
Such a request has to be reviewed and approved by Canada's judicial department and local court, and though Canada's judicial departments are unlikely to refuse the extradition, Huawei's legal teams could exhaust every means of judicial remedy in Canada to stop the extradition.
The US government alleges that Meng helped Huawei dodge US sanctions on Iran and has indicated it will file a formal extradition request by the January 30 deadline, CNN reported Thursday.
Wu Xinbo, director of Fudan University's Center for American Studies, told the Global Times that if Canada does agree to extradite Meng to the US in the worst scenario, bilateral ties will face unprecedented challenges.
The extradition will cause "downgraded diplomatic relations" between China and Canada, Wu said.
It will set a precedent of enterprises facing the harshest legal punishment for alleged misconduct they are charged of in a foreign country, said Wu.
US enterprises may face similar consequences in China, he said.
The current status of China-Canada relations does have a huge impact on bilateral exchanges and cooperation, but China is not responsible for that, Hua said.
The Canadian side has to take China's concerns seriously and correct its mistakes to change the situation, she said.
US extradition mirrors Iran sanctions: just don't have law on their side' on Huawei case
The US request to extradite Huaiwei Chief Financial Officer Meng Wanzhou goes against international law and mirrors its unilateral sanctions on Iran, which is opposed by the international community, Chinese Foreign Ministry said Wednesday.
The US extradition request mirrors US sanctions on Iran. However, as everyone knows, Huawei has repeatedly stated its compliance with all applicable laws and regulations of the countries in which it operates, said Hua Chunying, spokesperson of China's Ministry of Foreign Affairs.
Hua noted that China opposes unilateral US sanctions against Iran outside the UN Security Council framework. The sanctions are not in conformity with international law and have met with international opposition, including US ally Canada,she said.
Hua's comments came after the US Justice Department said on Tuesday it would continue to pursue the extradition of Meng and would meet all deadlines set by the US-Canada Extradition Treaty, Reuters reported, citing a statement released by US Justice Department spokesman Marc Raimondi.
Huang Feng, director of Beijing Normal University's Institute for International Criminal Law, told the Global Times this accusation is farfetched because she was allegedly accused of bank fraud at HSBC, a UK-based banking giant, not a US one, and Meng's activities were outside the US.
Canada's Department of Justice said an individual can be extradited if the alleged activity in question is recognized as a criminal in both countries.
Huang said that the extradition request cannot be passed by Canada unless the US offers solid evidence to prove that Meng violated the laws of Canada and the US.
The US action goes against international law and is unjustified, said Hua, noting that it is part of the country's political agenda to bully Chinese hi-tech firms and contain China's rightful development.
Huang also noted he found it strange that the Canadian ambassador announced the US request before the US formally send its extradition request. "Normally, none would publish relevant information unless it's formalized. So it seems like Canada is bluffing."
Ren Zhengfei, Meng's father and Huawei founder, said in an interview with foreign media on January 15, "I trust that the legal systems of Canada and the United States are open, just, and fair, and will reach a just conclusion," Ren said, according to a transcript Huawei released to media.
Meng case to further complicate China-Canada-US ties
Editor's Note:
The US has reportedly said to formally seek extradition of Huawei's Chief Financial Officer Meng Wanzhou. Since Meng was arrested on December 1 in Vancouver, the deadline for the US to file a formal extradition request is 30 January, 60 days after the arrest. What is the implication of Washington's move? How will it influence China-US-Canada relations? Global Times sought the opinion of two experts on the issue.
Li Haidong, professor with the Institute of International Relations at China Foreign Affairs University
US President Donald Trump has been deeply troubled by the government shutdown and the Russiagate investigation
As the deadline nears, Washington may be too busy coping with the shutdown chaos to consider Meng's case and make the formal extradition request. Ottawa is urging Washington to take the action.
Extradition is a strict cooperative law enforcement process between two jurisdictions. The US' filing a request does not mean that Canada must immediately send Meng to the US. Canada has to conduct a judicial review procedure to weigh the request, during which Meng's appeal will also be taken into account.
At least in the legal sense, if Meng's appeal is credible and convincing enough, there is a good chance that Ottawa would hesitate to transfer her to Washington.
Nonetheless, it should be noted that Meng's case is political in the garb of a legal procedure. If law is the only factor to be considered, I believe Meng will win the lawsuit; but when the political factors come into play, there would be increased uncertainty.
Meng's case is a long-running battle. As long as it is not resolved, it would be tough to iron out China-US-Canada relations.
Washington is unwilling to see any of its allies strengthening relations with Beijing, but China-Canada ties should not be affected by the Meng incident. Canada should abandon its role as a US puppet to sully China's image. The right thing for Ottawa to do is to immediately correct the mistake.
Chen Hongqiao, researcher at Guangdong University of Foreign Studies
Washington tends to make important decisions at the eleventh hour. It is used to taking a wait-and-see approach toward the two or more sides of the game, and then determine what measures to take.
In Meng's case, the US has its own strategic requirement. It needs to observe the interaction between China and Canada to make up its mind. If China takes a tough stance, the US would act prudently. If Canada requires support, the US will provide it.
Chinese Vice Premier Liu He will visit the US on January 30 and 31 for the next round of US-China trade negotiations. The US may proceed to file a formal extradition request for Meng just days before Liu's visit as a leverage to exert pressure on Beijing to pursue its interests in the trade talks. But the US side will not bring it up during the negotiations with Beijing.
According to Reuters, US President Donald Trump stated he would intervene in the Justice Department case against Meng if it is in US national security interest and US-China trade talks. His words signal that before Meng is extradited, he could apply the president's diplomatic prerogative to intervene. The US has a system of separation of powers and its judiciary branch is independent. If Meng is extradited to the US, it would be difficult for Trump to exercise his influence.
Canada claims to be a country with the rule of law, and will deal with the US request based on laws and will not hand over Meng without careful consideration. In fact, Ottawa has been disappointed with Washington, complaining that the US is competing with China at the expense of Canada. On the surface, Meng's incident is a legal issue, but politics and diplomacy play an important role.
Prepare for protracted game over Meng
The US Department of Justice confirmed on Tuesday that it will "meet all deadlines" to seek extradition of Huawei Chief Financial Officer Meng Wanzhou, signaling an extraordinarily high probability of the US filing a formal extradition request before January 30.
Washington's move will undoubtedly further intensify the dispute between the US and China over Meng's case. China must not bear any illusion and should prepare for more complicated games.
The Chinese government and media should continue to disclose and condemn that Washington and Ottawa have violated the basic legal spirit. Their sophistry must bear diplomatic and public pressure, and not to be left unimpeded in the international arena, as if Huawei did commit serious crimes.
Arresting Meng is obviously part of the US actions to crack down on Huawei. Anyone with a brain can clearly see Washington's intention to stop rising Chinese high-tech companies in the name of the law.
One thing should be made very clear: If Ottawa successfully assists Washington in the extradition of Meng, Beijing will retaliate against both of them without doubt.
The US' official request for extradition does not mean an immediate transfer of Meng. The Canadian court will then have a month to hear the US evidence and weigh the request before making judgment. Meng can also defend herself and appeal. This process may last a few months, or even years.
As a private company, Huawei is incapable of confronting the US and Canada's national system, but it can do its best to prolong the extradition process at most.
There has been a political purpose from the very beginning when news of Meng's case broke. Since Washington and Ottawa have vowed to declare that this is a 100 percent legal procedure, this political persecution must be strictly tested by their legal system.
Ottawa is stuck in the middle of Washington and Beijing, and involved in the whirlpool of geopolitical disputes. Being a US puppet is not easy. Canada may realize that it bears the blame for its ally. Its emphasis on acting by law is only a self-spiritual support in the current predicament.
Canadian public opinion is sensitive to any evidence of political persecution in this case, which can provide a potential favorable factor for Meng's defense and appeal.
Canada is a legal state under normal circumstances, and especially attaches importance to procedures and evidence. Although disguised as legal procedure, Meng's case, a case of injustice, is bound to have loopholes. Huawei has already shown its confidence in the upcoming litigation process.
China-US ties may also undergo certain subtle changes at any time which might dilute US political motives for persecuting Meng. We should never abandon such hope.
Meng's case has set an execrable precedent. Beijing's reaction will shape the world's understanding of China's national strength and will. Beijing must not be furious or cowardly.
We should take corresponding actions step by step in resolute and orderly manner, and show the world that Chinese are with reason and with restraint.
Any countries and forces that persecute Chinese citizens and infringe on China's interests will pay a heavy price. Global Times
Ottawa is now as sensitive as a frightened bird. A few
words by the ambassador should not have posed any impact on court
decisions. Nonetheless, judging from the reactions of many politicians
and journalists in Canada, McCallum's remarks are like a dreadful
monster.
Canadian Ambassador to China John McCallum admitted on
Thursday that he misspoke on the case of Huawei CFO Meng Wanzhou by
suggesting that she had a strong case to fight extradition to the US.
It's hard to accurately understand the potential of 5G
technology and its significance nowadays. More imagination should be
encouraged. However, referring to 5G competition as an arms race and
attaching so much importance to the dominance of the technology is
typical American thinking.
China's Huawei Technologies launched the world's first core
chip specifically designed for 5G base stations on Thursday in Beijing,
securing its leading position for 5G deployments in spite of political
pressure.
The Point: Is a Chinese-made subway new victim of espionage hysteria?
In custody: A profile of Meng is displayed on a
computer at a Huawei store in Beijing. The Chinese government, speaking
through its embassy in Canada, strenuously objected to the arrest, and
demanded Meng’s immediate release. — AP
https://youtu.be/8Uxk0mEonTA
https://youtu.be/sAha76_6YQQ
China urges release of Huawei executive
- In violation of universal human rights
Chinese officials are urging the US and Canada to clarify why Meng Wanzhou, a senior executive of Huawei Technologies, has been detained and to immediately release her, slamming the arrest as a violation of her rights.
Experts said on Thursday that Meng's detention is a move by the US to heat up the ongoing trade war between China and the US.
Meng, who is Huawei's chief financial officer and the daughter of Huawei's founder Ren Zhengfei, was detained as she was transferring flights in Canada, according to information provided by Huawei, one of China's tech giants.
Meng's detention was made following a request by the US, which is seeking her extradition on as yet unspecified charges made by prosecutors in the Eastern District of New York, a Huawei spokesperson told the Global Times on Thursday.
Meng was arrested in Vancouver on Saturday, the New York Times reported on Thursday, citing a spokesperson from Canada's Justice Department.
"China has demanded that the US and Canada immediately clarify the reasons for Meng's detention and to release her," Geng Shuang, spokesperson of China's Ministry of Foreign Affairs, told a daily press briefing on Thursday.
He noted that Chinese consular officials in Canada have already provided assistance to Meng.
Meng's detention, made without any clearly stated charges, is an obvious violation of her human rights, said Geng.
The Chinese Embassy in Canada also said on Thursday morning that it firmly opposes and has made strong protests over the action which has seriously curtailed the rights of a Chinese citizen.
"The Chinese side has lodged stern representations with the US and Canadian side, and urged them to immediately correct the wrongdoing and restore the personal freedom of Meng Wanzhou," the Chinese Embassy in Canada said in a statement published on its website.
A Canadian source with knowledge of the arrest was quoted in the Canadian newspaper Globe and Mail on Thursday as saying that US law enforcement authorities allege that Huawei violated US sanctions against Iran but provided no further details.
Although Meng's detention stems from terms of the US-Canada extradition treaty, the US should not be taking such legal action without providing concrete evidence, especially when it has been trying to restore relations with China, Hao Junbo, a Beijing-based lawyer, told the Global Times on Thursday.
Chinese officials and experts criticized the US for its long-arm jurisdiction, which not only hurts individuals but also enterprises.
Rising obstacles
Huawei has been targeted by the US for many years, from patent infringement lawsuits to political pressure, Xiang Ligang, chief executive of the telecom industry news site cctime.com, told the Global Times on Thursday.
"As the Chinese company grew stronger, it faced more obstacles in foreign markets as it is considered as a threat to local players," he said.
Cisco Systems filed the first lawsuit against Huawei in 2003. Motorola filed a lawsuit accusing Huawei of theft of trade secrets in 2010, according to media reports. The company also faced investigation by the US Congress on security issues.
Since at least 2016, US authorities have been probing Huawei's alleged shipping of US-origin products to Iran and other countries in violation of US export and sanctions laws, Reuters reported in April.
The US also asked its major allies to say 'no' to Huawei equipment, as it was worried about alleged potential Chinese meddling in 5G networks, the Wall Street Journal reported on November 23.
While the company faces rising difficulties in the US market, it has been actively exploring other markets such as the EU and Africa.
It became the world's largest telecom equipment provider in 2017, surpassing Ericsson and ZTE, industry website telecomlead.com reported in March, citing IHS data.
Huawei has a 28 percent market share in the global telecom infrastructure industry, followed by Ericsson and Nokia, which have 27 percent and 23 percent respectively, said the report.
Escalating trade war
The US will not stop countering China's rise in the technology sector and will never drop its hostility toward China's "Made in China 2025" strategy, Wang Yanhui, head of the Shanghai-based Mobile China Alliance, told the Global Times on Thursday.
"Huawei has become another card for the US to play against China in the ongoing trade war," he said.
China and the US announced a trade truce following a meeting between the two countries' top leaders in Buenos Aires on Saturday.
But experts warned that China should be prepared for a long-lasting and heated trade war with the US, as it will continue to attempt to counter China's rising power.
"The latest Huawei incident shows that we should get ready for long-term confrontation between China and the US, as the US will not ease its stance on China and the arrest of a senior executive of a major Chinese tech company is a vivid example," Mei Xinyu, a research fellow with the Beijing-based Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Thursday.
Huawei said there is very little information about specific allegations and that the company is not aware of any misconduct by Meng.
"The company complies with all laws and regulations in the countries in which it operates, including export control and sanctions laws applied in the UN, the US and the EU," Huawei said. - Global Times by Chen Qingqing
We hope that Canadian authorities handle the case
seriously and properly. We also hope that Ms Meng will be treated
humanely and will be bailed out. We would like to see Meng's case being
handled properly, so that she can regain her freedom as soon as
possible. Chinese society has always respected Canada, and it is
sincerely hoped that the way how Canadian authorities handle this matter
will live up to Chinese people's expectation and impressions regarding
the country.
The Chinese government should seriously go behind the US
tendency to abuse legal procedures to suppress China's high-tech
enterprises. It should increase interaction with the US and exert
pressure when necessary. China has been exercising restraint, but the US
cannot act recklessly. US President Donald Trump should rein in the
hostile activities of some Americans who may imperil Sino-US relations.
US takes aim at Huawei
Arrest of telecom giant's CFO escalates US-China tech battle
THE Trump administration’s efforts to extradite the chief financial officer of China’s Huawei Technologies Co over criminal charges mark the start of an even more aggressive phase in the technology rivalry between the United States and China and will increase pressure on Washington’s allies to shun the telecommunications company.
Armed with a US extradition request, Canadian authorities arrested Meng Wanzhou on Dec 1, the same day as President Trump was holding a summit with Chinese counterpart President Xi Jinping. But White House officials said Trump had no advance knowledge of the arrest, indicating the action was on a separate track from trade talks currently under way between Washington and Beijing.
Meng’s detention underscores a sense of urgency, at the Justice Department and other US agencies, to address what they see as a growing threat to national security posed by China’s ambitions to gain an edge in the tech sector. For years, Washington has alleged the Chinese government could compel Huawei, which supplies much of the world with critical cellular network equipment, to spy or to disrupt communications.
Huawei has long said it is an employee-owned company and isn’t beholden to any government, and has never used its equipment to spy on or sabotage other countries. The Chinese government, speaking through its embassy in Canada, strenuously objected to the arrest, and demanded Meng’s immediate release.
US prosecutors made the extradition request based on a sealed indictment for alleged violations of Iran sanctions that had been prepared for some time, people familiar with the matter said. A federally appointed US overseer, formerly charged with evaluating HSBC Holdings PLC’s anti-money-laundering and sanctions controls, relayed information about suspicious Huawei transactions to federal prosecutors in the Eastern District of New York, some of the people said.
Meng, the daughter of Huawei’s founder, Ren Zhengfei, is now in custody in Vancouver, and a bail hearing has been scheduled for Friday, according to a spokesman for Canada’s justice department.
Some worried a lack of coordination on the various strands of the Trump administration’s China initiatives could be counterproductive, especially if Trump decides to use the detention of Meng as leverage to extract concessions in the trade talks. The two sides agreed on a 90-day window from the Dec 1 summit to settle a trade dispute that has seen the two sides exchange tit-for-tat tariffs on each other’s goods.
“I’m very concerned that that’s just going to ratchet this trade war and make negotiations much more difficult,” said Gary Locke, former US ambassador to China. “This is I think a really hot-button, almost a grenade with respect to the 90-day negotiations.”
China has a long history of reading darker motives into US actions. “The risk is conspiracy theories in Beijing,” said China scholar Michael Pillsbury at Hudson Institute, who consults regularly with the Trump trade team. He compares the events to when China rejected US explanations that the United States had made a mistake when it bombed the Chinese Embassy in Belgrade in 1999 during the Kosovo war.
The arrest indicated the Justice Department had significant evidence against Meng, and that additional charges were likely, said Brian Fleming, a trade and national security lawyer at Miller & Chevalier. “This is just the tip of the iceberg,” he said.
The arrest could also add ammunition to an extraordinary US government campaign to persuade wireless and Internet providers in allied countries to stop using telecommunications equipment from Huawei, said national security experts.
US officials say they are intensifying efforts to curb Huawei because wireless carriers world-wide are about to upgrade to 5G, a new wireless technology that will connect many more items—factory parts, self-driving cars and everyday objects like wearable health monitors – to the Internet. US officials say they don’t want to give Beijing the potential to interfere with an ever-growing universe of connected devices.
Tech rivalry: The high-tech trade war shows
that for all the hoopla over manufacturing jobs, steel autos and
tariffs, the real competition is in the tech sector. — Reuters
IF you only scan the headlines, you could be forgiven for thinking that the US-China trade war is mainly about tariffs.
After all, the president and trade-warrior-in-chief has called himself “Tariff Man”. And the tentative trade deal between US President Donald Trump and Chinese President Xi Jinping was mainly about tariffs, especially on items like automobiles.
But the startling arrest in Canada of a Chinese telecom company executive should wake people up to the fact that there’s a second US-China trade war going on – a much more stealthy conflict, fought with weapons much subtler and more devastating than tariffs. And the prize in that other struggle is domination of the information-technology industry.
The arrested executive, Wanzhou Meng, is the chief financial officer of telecom-equipment manufacturer Huawei Technologies Co (and its founder’s daughter). The official reason for her arrest is that Huawei is suspected of selling technology to Iran, in violation of US sanctions.
It’s the second big Chinese tech company to be accused of breaching those sanctions – the first was ZTE Corp in 2017. The United States punished ZTE by forbidding it from buying American components – most importantly, telecom chips made by US-based Qualcomm Inc.
Those purchasing restrictions were eventually lifted after ZTE agreed to pay a fine, and it seems certain that Huawei will also eventually escape severe punishment. But these episodes highlight Chinese companies’ dependence on critical US technology.
The United States. still makes – or at least, designs – the best computer chips in the world. China assembles lots of electronics, but without those crucial inputs of US technology, products made by companies such as Huawei would be of much lower quality.
Export restrictions, and threats of restrictions, are thus probably not just about sanctions – they’re about making life harder for the main competitors of US tech companies.
Huawei just passed Apple Inc to become the world’s second-largest smartphone maker by market share (Samsung Electronics Co is first). This marks a change for China, whose companies have long been stuck doing low-value assembly while companies in rich countries do the high-value design, marketing and component manufacturing.
US moves against Huawei and ZTE may be intended to force China to remain a cheap supplier instead of a threatening competitor.
The subtle, far-sighted nature of this approach suggests that the impetus for the high-tech trade war goes far beyond what Trump, with his focus on tariffs and old-line manufacturing industries, would think of. It seems likely that US tech companies, as well as the military intelligence communities, are influencing policy here as well.
In fact, more systematic efforts to block Chinese access to US components are in the works. The Export Control Reform Act, passed this summer, increased regulatory oversight of US exports of “emerging” and “foundational” technologies deemed to have national-security importance. Although national security is certainly a concern, it’s generally hard to separate high-tech industrial and corporate dominance from military dominance, so this too should be seen as part of the trade war.
A second weapon in the high-tech trade war is investment restrictions. The Trump administration has greatly expanded its power to block Chinese investments in US technology companies, through the Committee on Foreign Investment in the United States.
The goal of investment restrictions is to prevent Chinese companies from copying or stealing American ideas and technologies. Chinese companies can buy American companies and transfer their intellectual property overseas, or have their employees train their Chinese replacements.
Even minority stakes can allow a Chinese investor access to industrial secrets that would otherwise be off-limits. By blocking these investors, the Trump administration hopes to preserve US technological dominance, at least for a little while longer.
Notably, the European Union is also moving to restrict Chinese investments. The fact that Europe, which has opposed Trump’s tariffs, is copying American investment restrictions, should be a signal that the less-publicised high-tech trade war is actually the important one.
The high-tech trade war shows that for all the hoopla over manufacturing jobs, steel, autos and tariffs, the real competition is in the tech sector.
Losing the lead in the global technology race means lower profits and a disappearing military advantage. But it also means losing the powerful knowledge-industry clustering effects that have been an engine of US economic growth in the post-manufacturing age. Bluntly put, the United States can afford to lose its lead in furniture manufacturing; it can’t afford to lose its dominance in the tech sector.
The question is whether the high-tech trade war will succeed in keeping China in second place. China has long wanted to catch up in semiconductor manufacturing, but export controls will make that goal a necessity rather than an aspiration. And investment restrictions may spur China to upgrade its own homegrown research and development capacity.
In other words, in the age when China and the United States were economically co-dependent, China might have been content to accept lower profit margins and keep copying American technology instead of developing its own. But with the coming of the high-tech trade war, that co-dependency is coming to an end. Perhaps that was always inevitable, as China pressed forward on the technological frontier. In any case, the Trump administration’s recent moves against Chinese tech – and some similar moves by the EU – should be seen as the first shots in a long war.
After years of planning, the robotic Chang'e-4 mission will launch tomorrow at 1:30 p.m. EST.
Rising space power China is preparing to launch a ground-breaking mission to soft-land an unmanned spacecraft on the far side of ... China prepares mission to land spacecraft on moon's far side. By Christopher Bodeen | AP.
The first ever China International Import Expo (CIIE) kicks off in Shanghai today. President Xi Jinping attends the opening ceremony and delivers a keynote speech at the ceremony.
The China International Import Expo (CIIE), the world's first import-themed national expo, kicks off on Monday. More than 3,000 enterprises from some 130 countries and regions will exhibit their products, taking this as a premier opportunity to enter or expand their presence on the Chinese market.
But there are still fault-finding reports about the event. Some say sarcastically that no state leader or government head from the G7 will attend the expo. Some even link the CIIE with the China-US trade war in spite of the fact that China announced the CIIE in May 2017 at the Belt and Road Initiative on International Cooperation, before the trade war hadn't started.
Why do these media always want to dig out some political ends from the CIIE, which is in any way a good thing for global trade as well as the exports of Western countries?
CIIE is being held to serve enterprises and exporters worldwide, not Western leaders. Japan ranks first in terms of the number of participating companies, followed by South Korea, the US, Australia, Germany and Italy. This fully demonstrates how much passion companies from developed countries hold toward the expo and heralds the expo's success.
If more countries and regions with a trade surplus can host import expos, that will promote global trade balance. Those with a trade deficit should not blame others, but encourage their enterprises to grasp every opportunity to promote their products. Sometimes the problem lies in information asymmetry and an import expo can provide a platform for suppliers and buyers to communicate at a low cost.
China has long had a trade surplus and too much of it is not helpful for the country. More imports of high-quality products can help Chinese to upgrade their consumption and advance the production. The inherent drive for hosting CIIE is to translate part of China's foreign exchange reserve into social progress.
China started very early by holding trade fairs in Guangzhou and later became a leading exporter in the world. Now we are holding the import expo in the hope of promoting our imports.
Tangled in a trade war with the US, China could have shut US companies out of the expo as a way of pressuring, but it has acted the other way around. By contrast, the US now thinks everything about the Chinese economy is wrong and whatever China does is a trick. The two countries differ in their visions.
We believe that the CIIE, if held regularly, will help China enhance the quality of its imports and balance its imports and exports. China doesn't need to care what the outside world thinks of the expo, nor should it intentionally enhance the volume of transactions as a proof of kindness.
As long as the Chinese market grows larger, CIIE will attract more attention and will be remembered in world trade history as a positive event.
Countries, businesses look forward to CIIE
As the first China International Import Expo (CIIE) nears, officials and entrepreneurs around the world aim to seize the opportunity to explore the Chinese market, voicing greater confidence in China's further opening up.
"We understand the CIIE as ... showcasing China's greater openness to importers. These are all moves in the right direction," World Bank Group President Jim Yong Kim said. "We support what China is doing to expand imports and address global trade imbalances."
Lithuanian President Dalia Grybauskaite told Xinhua that "the expo is a 'win-win' event for both, China and the world, as it provides new opportunities for cooperation, helps companies across the globe enter the Chinese market and paves the way for China to satisfy its growing demand for high-quality products."
Pakistan is confronted with current account deficit and the CIIE "is a great opportunity for Pakistan to have a pavilion where we will be exhibiting our exports," Pakistani Prime Minister Imran Khan said.
Khan hailed China's reform and opening up policy which provides Chinese industries a better environment to compete in international trade. "China has set a good example," he said.
Madagascar will showcase products such as vanilla, cocoa beans, coffee beans and minerals at the CIIE. China offers a great opportunity for everyone, and everyone must know how to seize this opportunity, Minister of Tourism Jean Brunelle Razafintsiandraofa told Xinhua.
"Australia thinks it (the CIIE) is a great celebration of ... the economic contribution that China makes to the region and the world. That is why we're delighted that some 180 Australian businesses and brands are participating," said Australian Minister for Trade, Tourism and Investment Simon Birmingham.
"We are in global markets, we are all together and we want to cooperate," Israeli Scientific Minister Ofir Akunis said, adding that it is a "very good idea" and the "right way" that China hosts the CIIE where people from all over the world will meet meet on cooperation in the future.
"I think (the CIIE) is a great opportunity to show the players in the global economic environment the opening of China to world trade, and it is also a contribution to the growth of the global market," Marco Tronchetti Provera, CEO of Italian-Chinese tyre maker Pirelli, told Xinhua.
The CIIE, a significant move by the Chinese government to further open the Chinese market, has attracted about 2,800 exhibitors from over 130 countries and regions. Economic and trade exchanges are bringing more benefits to all sides.
"We are going to Shanghai to represent more than 89 of our members who are able to export a range of products (to China)," Sandile Ndlovu, Executive Director of the South African Aerospace, Maritime and Defence Export Council, said. "China could be one of our biggest customers as there is so much potential for trade with China."
Marathon Ginseng, a U.S. Wisconsin-based ginseng grower, will have a stall at the CIIE. It registered for the expo the first time it heard of the fair.
"It is a big event in China," Jiang Mingtao, founder of Marathon Ginseng, told Xinhua. "We hope to enhance the reputation of ginseng produced in the state of Wisconsin ... and let more Chinese consumers know our products - Global Times
JUST 11 weeks into his election victory, Pakistan’s new Prime Minister Imran Khan has already had to accomplish a task that seriously tests his diplomatic skills.
More than that, it is a task that would tax his diplomatic creativity. And that is in addition to the dire economic challenges he already faces at home.
Confronted with multiple needs and demands, it has taken some time for the new Government to form a Cabinet. Pakistan’s economy has taken some beating. Imran’s opposition party won the August election on a tide of change, against an incumbent party in government whose leaders had been charged with corruption.
Worse, the novice Prime Minister also has to contend with unfavourable terms that the previous government had agreed to with China in its Belt and Road Initiative (BRI) projects.
Imran is in Beijing this weekend to try to negotiate those terms.
One theme Imran’s delegation may be pursuing is explaining to Beijing the plight currently facing Pakistan: in its dire economic straits, Islamabad has to choose between negotiating terms with the International Monetary Fund (IMF) or renegotiating terms with China.
Neither option is ideal by any means. Going with the IMF may even be a worse debt trap than China has ever been accused of fostering. The fact that Imran is in Beijing shows that the lesser evil may be to renegotiate the BRI terms, such as reducing the costs to Pakistan by a couple of billion US dollars.
If Pakistan opts to go with China, it would prove that any conceivable terms with the IMF would be more onerous and risky. Both the new Finance Ministry and Imran’s task force are leaning that way.
Alternatively the BRI projects could be deferred, but would China agree? Much of that remains to be seen, or heard, in the following days. For now, it is important to remember that such situations are prone to misinterpretation and misrepresentation – including of the deliberate kind.
Predictably, the largely Western international media have already portrayed Pakistan as “saying no” to the China-led BRI.
But why would Pakistan ever do that? The China-Pakistan Economic Corridor (CPEC) as a vital segment – indeed, the flagship – of the BRI is of far greater value and importance to Pakistan than to China.
Whatever strategic or symbolic significance the US$62 bil (RM258bil) CPEC may have or be said to have for China, it is dwarfed by the immediate and tangible benefits for Pakistan’s development.
It is situated fully and squarely in Pakistan, not China, covering much of Pakistani territory and set to boost such sectors as energy, telecommunications, tourism, trade and transportation. Pakistan’s Railways Ministry calls CPEC the “backbone” of the country.
Its strategic value to China is access to the Arabian Sea at the corridor’s south-western corner in the port of Gwadar. It is access that China does not need now, and may or may not need sometime in the future. China is comfortable investing heavily in Pakistan’s development because the two countries have a special relationship in South Asia. Western observers who still consider Pakistan a Western ally need to have their perspective of Asia updated. Casting Islamabad as a US ally is merely harking back to the 1950s era of the US-led South-East Asia Treaty Organisation (Seato) in the early phase of the Cold War.
Times have moved on, as have China and Pakistan. Their leaders have repeatedly declared their respective countries “all-weather friends” – perhaps even allies.
To India, China and Pakistan have no common border, their link being only Pakistan-occupied Kashmir (PoK). The territory is bitterly disputed with India following the 1963 China-Pakistan boundary agreement.
Controversy with India flared again two days ago when a bus service was launched linking Lahore with Kashghar in Xinjiang, with the route running through contested PoK.
The term “debt trap” in reference to allegedly risky China-led projects was not coined by China, Pakistan or even Sri Lanka. It was coined by an Indian economist.
If any doubt still lingers over the China-Pakistan relationship, BRI cooperation continues between them and may even expand. Both countries are now seeking to extend CPEC into Afghanistan.
On a stellar scale, China helped Pakistan launch two satellites this year. By 2020, Pakistan hopes to send its first astronaut into space under China’s space programme.
India’s problem with the BRI is essentially its passage through territory disputed with Pakistan. That has now been conflated with what is said to be “Pakistan’s problem” with the BRI.
Western pundits in particular tend to draw such hasty and hazy conclusions since they accord with preconceived US notions of a rising China threat. Such misperceptions are not only wrong but misleading.
Asian countries have a different perspective because a rising China as Asia’s main economy also means a rising Asia. It is the proverbial rising tide that lifts all boats in this region of the continent.
Even the classic anecdotal “debt trap,” Sri Lanka’s Hambantota Port, was never quite the disaster its detractors claimed it to be. That controversy was built up principally between Sri Lanka’s contending political parties and their different positions on China at the time.
Now that Mahinda Rajapaksa – prime mover of the Hambantota project and defeated in the 2015 presidential race – has returned as Prime Minister nine days ago, punditry should be buzzing.
The point, however, is to arrive at reasoned analysis away from wild speculation. China is a rational player whatever the objective may be, so that a rational approach can only help understanding.
For its part, China should also empathise with its BRI partners in the conditions they find themselves in. Financially strapped and economically challenged, nations that wish to work with the BRI are constrained by factors beyond their control.
First, these countries may have new governments that have inherited a broken economy from their predecessors. Much urgent repair work first needs to be done. Second, BRI projects are largely about massive infrastructure, usually the most expensive public projects to be undertaken by any government. Third, much of the BRI runs through developing countries and regions that may not have the largest financial resources even at the best of times.
How will Pakistan’s appeal to China for revised terms hold out? Prime Minister Imran Khan should be able to win some concessions.
After all, China has helped other Asian countries before in times of need, even at some expense to itself. When the 1997-98 Asian Financial Crisis struck, China postponed its scheduled currency revaluation to absorb some of the cost so that the afflicted countries do not go under from excessive loan repayments. Such a generous gesture from Beijing would not be out of character, whether the beneficiary is Pakistan or Malaysia.
After all, each boasts a special relationship with Beijing.
US claws at China’s chip industry fanning flames on tech confrontation. Cartoon: Carlos Latuff 
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