CHINADebate

Malcolm Riddell

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CHINADebate

‘Over the next six months or more, the energy crunch in China will be an even bigger challenge than Evergrande. Will make the Evergrande problem look tiny and has huge global implications. The lights go out in China!’ one experienced and very well-respected reader of long residence in China wrote to me in response the last issue on Evergrande.

  • And he may well be right. In any case, China’s challenges are piling up right now.
  • The power shortage is just the latest: Goldman Sachs estimate that as much as 44% of China's industrial activity has been hit by the power shortages.

‘The electricity crunch has laid bare one of China’s strategic weaknesses: It is a voracious, and increasingly hungry, energy hog,’ writes The New York Times’ Keith Bradsher in ‘China’s Power Problems Expose a Strategic Weakness.’

  • ‘China’s electricity shortage is rippling across factories and industries, testing the nation’s status as the world’s capital for reliable manufacturing.’
  • ‘A bread company can’t get all the power it needs for its bakeries. A chemicals supplier for some of the world’s biggest paint producers announced production cuts. A port city changed electricity rationing rules for manufacturers four times in a single day.’
  • ‘Until enough power comes online, China’s factories risk unexpected and destabilizing stoppages.’
  • And so do the foreign companies who depend on their products and participation in their supply chains.

Impact on GDP?

  • Eswar Prasad, a former head of the IMF’s China division who now teaches at Cornell University, is quoted in the Financial Times: 'The emphasis on deleveraging, squeeze on property speculation and energy shortages are likely to have substantially dented China’s already weak growth momentum.’
  • Goldman Sachs (and it wasn’t the only one) has cut its forecasts for China’s economic growth in 2021 as constraints on energy consumption added to headwinds facing the world’s second-largest economy - it now expects China’s economy to grow 7.8% in 2021 compared with a year ago, lower than its previous forecast for an 8.2% year-on-year expansion.

If you do business in China or depend on China as part of your supply chain, or if you are an investor in China or Chinese financial products, take heed.

  • And don’t forget the rest of the world: The power shortage is global.

BTW, Trivium China is having another of its terrific Flash Talks – this one on ‘China's systemic power disruptions’ on October 21 at 9:30am EDT. A don’t miss.

  • For more information and to register, click here.

Read on for more about a few aspects of the power shortage in China and the world.

  • Lots of lessons here about how the Chinese government works and how it manages Chinese businesses.

And be sure to send me your take.

1 | The Scope of China’s Power Shortage

These the shortages began as early as May. In the European Chamber Stance on China’s Energy Management Measures,’ the EU Chamber of Commerce in China writes:

  • ‘In May 2021, manufacturers in Guangdong were told by the local authorities to curb energy consumption, leading to many companies having to abruptly shut down operations for several days at a time.’

Reuters reports ‘Rationing has already been in place in at least 17 of mainland China's more than 30 regions since September, forcing some factories to suspend production and disrupting supply chains.’

2 | Why? The Big Picture

Broadly speaking, as countries began recovering from the pandemic, global demand for products from the China – the world’s top manufacturer - suddenly and unexpectedly shot up this year.

  • And China’s power sector couldn’t keep up.

70% of China’s electricity comes from coal-fired power.

  • And the power sector has been moving away from the use of coal as fuel toward greener options.
  • On top of this, the stockpile of coal was already low.
  • With coal mining down, the supply of foreign coal limited because of the ban on Australian lignite, coal prices going up sharply, China couldn’t quickly increase supply.
  • Hence, the power shortage.

3 | A Note on China’s Ban on Australian Coal

In 2020, Beijing began a full-out bullying campaign against Australia.

  • The reason: Australia called for an impartial investigation in the origins of COVID-19.

One part of China’s pressure campaign to hurt Australia was an informal ban on its coal.

  • And, as the chart shows, Australian coal exports to China have fallen sharply.

Australia has hung tough – good on them.

  • But now China needs that coal and has quietly started letting small shipments through customs.
  • Karma or what goes around comes around or any other cliché you think fits.

4 | Why? More Details

IHS Markit on September 29 in ‘Tight coal supply and climate-related control result in wide-spread power outages in China’ reported: China is currently going through one of the most significant power outages in a decade.’

  • ‘By September 28, 22 provinces have experienced different degrees of load shedding measures.’
  • ‘For a nation that has largely maintained power supply security during two decades of robust growth, it is astonishing to see that nearly two-thirds of the country are suffering from power shortage - and not during summer or winter peak demand seasons.’

‘So far 12 provinces have identified coal supply shortage as the key reason behind for power rationing or rolling blackouts.’

  • ‘In the three provinces in northeast China—Liaoning, Jilin and Heilongjiang, in particular, even residential power usage is affected, a rare occurrence for a country putting household energy supply in a prioritized category [to prevent social unrest].’
  • ‘For most provinces, industrial power rationing remains the key measure.’

‘For these 12 provinces, shortfall in coal-fired power generation - stemming from fuel shortage and skyrocketing coal prices - is a chief cause for power outages.’

  • ‘By September 2021, thermal coal price is reported to have tripled from a year ago.’

‘Meanwhile, policymakers have demanded coal-fired power tariff remain on par with on-grid benchmarks, which were calculated during much lower coal price periods.’ So coal-fired power plants are losing money and don’t want to produce.

  • ‘Although policy change a few days ago approved 10% increase from the local benchmark power price in a number of provinces, this price hike will only marginally reduce the losses made by coal-fired power generators.’
  • ‘This disconnect between market-based coal prices and tightly regulated power prices has led to power supply disruptions in the past, especially when coal prices were high.’

‘A series of supply shocks have contributed to the coal price surge.’ And slowing energy production.

  • ‘Domestic coal supply disruption started with the anti-corruption campaign in Inner Mongolia last year, followed by a few rounds of heightened safety inspections and environmental checks.’
  • ‘In addition, under new production regulations, it is now illegal for coal miners to produce beyond their approved nameplate capacity - a practice that had been allowed previously.’
  • ‘Coal imports have also been weakened by floods in Indonesia, the import sanction on Australia, as well as new Covid-19 outbreaks in Mongolia.’

5 | Why? Even More Details

‘The European Chamber believes there are several reasons why electricity is suddenly in short supply in China,' writes the EU Chamber of Commerce in China provides an on-the-ground explanation for the shortage is in tits ‘European Chamber Stance on China’s Energy Management Measures,’:

  • ‘In mid-August, the National Development and Reform Commission (NDRC) released a notice on provinces’ energy usage in order to enforce China’s ‘dual control’ targets for reducing both energy consumption and energy intensity.’
  • ‘The notice highlighted the fact that, during first half of 2021, only 10 out of 30 regions achieved their energy reduction targets.’
  • ‘As a result, local governments are now taking extreme measures in order to achieve their targets before the end of the year.’

‘This situation is being further exacerbated due to both the current energy mix and deficient infrastructure: the power supply from new energies (wind and photovoltaic) is unstable, and is not sufficient to make up for the shortfall of thermal power and hydropower generation.’

  • ‘In addition, rising prices for coal and gas have sharply increased costs for power producers, who are reluctant to increase supply as they would incur losses.’

‘Recent arbitrary actions taken by local authorities have lacked transparency and consistency, and furthermore have no legal grounds.’

  • ‘They are seriously jeopardising companies’ operations in China, creating short-term safety risks—especially in the chemical and healthcare industries—and undermining business confidence in the medium to long-term.’

Now multiply that by the number of Chinese companies affected.

6 | China Moves

‘ “We will make every effort to increase coal production and supply,” said Zhao Chenxin, the secretary general of the National Development and Reform Commission, China’s top economic planning agency,’ reports The New York Times.

  • ‘Mr. Zhao said that even with the push for more coal production, China would continue efforts to become more energy-efficient.’ A tough act to balance.

‘The authorities have announced a national rush to mine and burn more coal, despite their previous pledges to curb emissions that cause climate change.’

  • ‘Mines that were closed without authorization have been ordered to reopen.’
  • ‘Coal mines and coal-fired power plants that were shut for repairs are also to be reopened.’
  • ‘Tax incentives are being drafted for coal-fired power plants.’
  • ‘Regulators have ordered Chinese banks to provide plenty of loans to the coal sector.’
  • ‘Local governments have been warned to be more cautious about limits on energy use that had been imposed partly in response to climate change concerns.’

‘Power rationing appears to have eased somewhat since late last month, when widespread blackouts and power cuts caught factories by surprise.’

  • Something is working; we just aren’t sure what.

But ‘the winter heating season officially began on October 15th in the country’s northeast and continues into north-central China next month.’

  • And Beijing will be forced to choose.

‘ “They have to sacrifice something to make sure households will have heat and power,” said Chen Long, a co-founder and partner of Plenum, a Beijing economics and politics research firm.’

  • ‘ “They have to cut energy-intensive industries.” ’

And there goes GDP for China and with it uncertainty about and interruptions of supply chains for the rest of the world.

7 | A Little Global Context

China was hit first. But it is just one country or region facing an energy crunch and its implications.

8 | The ‘COVID-Green’ Crisis

‘The economic recovery from the pandemic recession lies behind the crisis, coming after a year of retrenchment in coal, oil and gas extraction,’ says Will Englund in ‘An energy crisis is gripping the world, with potentially grave consequences: How China and Europe are catching the brunt of it,’ in The Washington Post.

  • ‘Other factors include an unusually cold winter in Europe that drained reserves, a series of hurricanes that forced shutdowns of Gulf oil refineries, a turn for the worse in relations between China and Australia that led Beijing to stop importing coal from Down Under, and a protracted calm spell over the North Sea that has sharply curtailed the output of electricity-generating wind turbines.’
  • ‘ “It radiates from one energy market to another,” said Daniel Yergin, author of The New Map: Energy, Climate, and the Clash of Nations.

“COVID-Green” energy crisis, is what J.P. Morgan researchers are calling it, says The Hill.

9 | The Ball is in Your Court

As someone who doesn’t follow the ins and outs of the crucial battle against climate change, two things here surprised me.

  • First, that we are having a global power crisis in itself shows countries are a lot further along in shifting away from carbon-based fuels than I had thought – as a political skeptic, I had figured just lots of promises, not much action. Wrong.
  • Second, given the massive brainpower that is dedicated to the issue, I had assumed that the pointy-heads would have built in massive resilience for the transition to clean energy. Wrong again.

As The Economist – its cover headline this week is ‘The Energy Shock’ - points out:

  • ‘The danger is that the shock slows the pace of change.’

‘This week Li Keqiang, China’s premier, said the energy transition must be “sound and well-paced”, code for using coal for longer.’

  • 'Public opinion in the West, including America, supports clean energy, but could shift as high prices bite.’

‘Next month world leaders will gather at the cop26 summit, saying they mean to set a course for net global carbon emissions to reach zero by 2050.’

  • ‘As they prepare to pledge their part in this 30-year endeavour, the first big energy scare of the green era is unfolding before their eyes.’
  • ‘The message from the shock is that leaders at cop26 must move beyond pledges and tackle the fine print of how the transition will work.’

Politicians of the world, the ball is in your court.

  • Don’t screw it up.

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‘Xi and the phrase #ChinaCoup trended on social media after tens of thousands of users spread unconfirmed rumors that the president was detained and overthrown by the China's People's Liberation Army.’
keep reading

'How do you spy on China?'

Many of you have asked about my own take on the issues I analyze in these pages and about my background. Today is some of both.I am honored to have been interviewed by the terrific Jeremy Goldkorn, editor-in-chief of The China Project. Below is part of that interview.
September 18, 2022

Xi’s Dangerous Radical Secrecy

In a world of political hardball, investigative reporting, and tabloids, we know a lot (if not always accurate or unspun) about world leaders, especially those in functioning democracies. Not so with Xi Jinping.
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Whether you view it as an aggressive adversary or a nation asserting itself in ways commensurate with its rising status, China is creating risks – some subtle, some obvious - that, along with reactions of the U.S. and its allies, have to be factored, into every related business, investment, and policy strategy.
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Ever since Xi Jinping announced ‘One Belt, One Road’ in 2013, I watched it expand China’s economic and geopolitical influence and lay the foundation for projecting its military power – and become by many accounts an exploiter of the developing world itself.
July 1, 2022

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Understanding the drivers of China’s rise to supply chain prominence gives (me anyway) insights to help analyze the changes – or not – of ‘decoupling.’
June 12, 2022

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Wang Jisi notes that the views are his own, and certainly we don’t know how closely, if at all, they reflect the thinking of anyone in the leadership. But given his straightforward and thorough analysis, free of canned arguments and slogans, I hope they do. I also hope the Biden administration pays heed.
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And while the impact of Zero Covid may be relatively short-lived, the impact of Mr. Xi’s return to the socialist path will be felt for a very long time, both in China and the world. So the impact will no doubt be felt as long as Mr. Xi leads China.
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‘The bad news is that very few corporations engaged in China have contingency plans or long-term strategies to hedge against the downside risks of growing geopolitical competition.’
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Shang-jin Wei Presentation-1 | Drivers of Growth Momentum

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‘Why does gender imbalance have such an outsize impact on China’s housing prices?'
December 30, 2021

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December 30, 2021

Shang-jin Wei Presentation-3 | Analyzing the Gender Imbalance Data

‘Compare these with graph showing the impact of the same factors on rental prices...'
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Watch What Beijing Says - and Does

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Getting (Xi Jingping's) Priorities Straight

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Look Through the Rights Lenses

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Sometimes You Just Have to Roll the Dice

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December 7, 2021

'Xi Jinping has made sure history is now officially on his side'

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'Biden Has a Summit With Xi, but No Strategy for China'

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November 23, 2021

Xi Jinping's Leadership: 'The Inevitable Outcome of History'

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'America's China Plan: A Proposal' by Clyde Prestowitz

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November 9, 2021

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Forget Evergrande and the energy crunch. After the recent flurry of alarming headlines, here’s the question I get most often these days from CEO’s and institutional investors: Will China invade Taiwan in the next few years?
October 27, 2021

An Energy Crunch. China's Latest Crisis. They Just Keep Piling Up.

‍‘Over the next six months or more, the energy crunch in China will be an even bigger challenge than Evergrande. Will make the Evergrande problem look tiny and has huge global implications. The lights go out in China!’ one experienced and very well-respected reader of long residence in China wrote to me in response the last issue on Evergrande.
October 17, 2021

Just How Contagious is Evergrande?

Just as a personal crisis can lead you to dig deeper into yourself, so the rapid-fire events in China - with trillions of dollars of business and investment on the line - have led us to (finally) go deeper into how China works – and to come to grips with uncertainties caused by Xi Jinping’s recent moves to reshape the Chinese economy and the Party’s social contract with the Chinese people.
October 7, 2021

'This Time Feels Different'

Just when we thought we were getting used to Xi Jinping’s tech reforms and social-engineering regulations, the Evergrande crisis heats up.
September 27, 2021

AUKUS: A New World Order?

‍In case you passed over the news of AUKUS, the new strategic alliance among the U.S, the U.K., and Australia, here a few headlines to encourage a deeper look.
September 19, 2021

Xi Jinping: Today, video games. Tomorrow, well ... just be good.

Today's issue is a heads up on what may be Xi Jinping's efforts to reshape Chinese society.
September 7, 2021

The Taliban: 'China's Perfect Partner'?

Breaking through the blow-by-blow reporting that started when the Taliban began its sweep to victory are the geopolitical analyses of who gains and who loses in Afghanistan.
August 28, 2021

'China Signals More Regulation for Businesses in Coming Years'

‘The State Council’s statement provides a guiding context to interpret current regulatory thrusts. The blueprint as an attempt by Chinese authorities to help investors understand the motives behind the regulatory push.’
August 15, 2021

China Economy: Industrial Production Down, Demand Resilient

China’s industrial production down 10%. Demand resilient.
August 15, 2021

'Xi’s Dictatorship Threatens the Chinese State'

‘Mr. Xi is determined to bring the creators of wealth under the control of the one-party state.’
August 15, 2021

'Are you tired of losing yet, America?'

As I write this, Taliban forces have entered Kabul and are reportedly occupying the Presidential Palace.
August 15, 2021

‘Global investors shocked to have discovered that China is run by Communists.’

‘Global investors are shocked to have discovered that China is run by Communists.’
August 5, 2021

'Shocked Investors Scour Xi’s Old Speeches to Find Next Target'

‘While China’s policy moves can feel ad hoc particularly to foreign investors, the changes are quite targeted on certain sectors.’
August 5, 2021

'China Wants Manufacturing—Not the Internet—to Lead the Economy'

‘Social media, e-commerce and other consumer internet companies are nice to have. But in his view national greatness doesn’t depend on having the world’s finest group chats or ride-sharing.’
August 5, 2021

Don't Say Xi Jinping Didn't Warn You

‘Global investors are shocked to have discovered that China is run by Communists.’
August 5, 2021

'Xi's Four Pillars of Regulation'

‘Broadly, Beijing is concerned about four pillars of stability: banking, anti-trust regulation, data security and social equality. All of Beijing’s major interventions reflect these concerns.’
August 1, 2021

'Why China Is Cracking Down on Its Technology Giants'

‘Why, you may ask, is China crushing some of its most innovative unicorns? We’re in a new era led by President Xi Jinping, and politics are in command.’
August 1, 2021

China's Tech Crackdown: 'Nobody Saw It Coming.' — Huh?

‘Carnage in China's financial markets signals the beginning of a new era as the government puts socialism before shareholders, and regulatory changes rip apart the old playbook,’ writes Reuters’ Tom Westbrook.
August 1, 2021

'The most significant philosophical shift since Deng'

‘Carnage in China's financial markets signals the beginning of a new era as the government puts socialism before shareholders and regulatory changes rip apart the old playbook. According to some analysts, it is the most significant philosophical shift since former leader Deng Xiaoping set development as the ultimate priority 40 years ago.’
August 1, 2021

'Stock Market: China Doesn’t Care How Much Money Investors Lose'

‘Does Beijing not care how much money foreign investors have lost? Does the government really want to close China Inc.’s access to the deep pool of global capital? The short answer is, no, the government doesn’t care.
August 1, 2021

How China's Middle-Class China is Transforming China and the World

‘Among the many forces shaping China's domestic transformation and its role on the world stage, none may prove more significant than the rapid emergence and explosive growth of the Chinese middle-class.’
July 25, 2021

Part 2 | The DiDi VIE (as an example)

‘The prospectus has a diagram, above, of the corporate structure, which looks almost normal. But everything below the double arrow — the actual ride-hailing business, etc. — is slightly askew.’
July 22, 2021

Part 3 | Revising the Rules

‘The Chinese government could declare “all these VIE contracts are actually a disguised form of foreign ownership, which is not allowed by the rules, so they are all void and your Didi and Alibaba shares are worthless.” ’
July 22, 2021

Part 1 | 'Owning Chinese Companies Is Complicated'

‘ “Variable interest entities”(VIEs): The problem with this is that it sort of sounds like you’re kidding. But this is a standard method for mainland Chinese internet companies to go public, and the market has come to accept it.’
July 22, 2021

China: Signals Blinking Red & Oops, We Missed the Risks

I had intended to make this issue all about ‘Variable Interest Entities’ (VIEs) and the emerging risks to about $1.8 trillion dollars’ worth of Chinese shares listed on U.S. exchanges – that is, 4% of the capitalization of the U.S. stock markets.
July 22, 2021

'Crackdown on US listings: Will China close $1.6tn VIE loophole?'

‘If Chinese authorities start to question “Variable interest entities”(VIEs), amid the crackdown that has already battered ride-hailing company Didi Global -- another VIE user -- the resulting loss of investor trust could send shock waves through global financial markets.’
July 22, 2021

'China Plans to Exempt H.K. IPOs From Cybersecurity Reviews'

‘China plans to exempt companies going public in Hong Kong from first seeking the approval of the country’s cybersecurity regulator, removing one hurdle for businesses that list in the Asian financial hub instead of the U.S.’
July 18, 2021

'I will aim for Mao's Status.'

‘There on the gate was Xi Jinping, Chinese president and party general secretary, in a gray Mao suit. Just below his feet was the portrait of Mao Zedong, also dressed in a gray Mao suit.’
July 18, 2021

Why the U.S. Lacks Leverage over China

During the celebration of the Chinese Communist Party’s Centennial celebration, Mr. Xi stood in the same place on the balcony facing Tiananmen Square where Mao Zedong stood when he announced the founding of the PRC; Mr. Xi wore a gray Mao suit, among a sea of blue western suits; and he centered himself right above the portrait of Mao, who is similarly attired.
July 18, 2021

'Biden’s Warning on Hong Kong'

‘The pretense of Chinese and Hong Kong authorities is that their crackdown on the rule of law and dissent will have no effect on Hong Kong’s viability as an international center for trade and finance.’
July 18, 2021

Hong Kong and the Limits of Decoupling

‘The United States’ inability to make China regret—much less reverse—its transgressions in Hong Kong suggests that financial separation, sanctions, and economic barriers are less reliable tools than many in Washington believe.’
July 18, 2021

'US warns companies of risk of doing business in Hong Kong'

“In the face of Beijing’s decisions over the past year that have stifled the democratic aspirations of people in Hong Kong, we are taking action,” said Antony Blinken, US secretary of state. “Today we send a clear message that the US resolutely stands with Hong Kongers.”
July 18, 2021

'What's Wrong with Biden’s new China doctrine'

‘Mr Biden’s aides invariably start any discussion of China strategy with the need to restore American greatness after decades of decline.’
July 15, 2021

Part 2 | Joe Biden is determined that China should not displace America

‘Mr Biden’s aides invariably start any discussion of China strategy with the need to restore American greatness after decades of decline.’
July 15, 2021

The Biden Doctrine and Its Discontents

President Biden has framed China as a threat both to the U.S. and the liberal world order.
July 15, 2021

Part 1 | 'Joe Biden is determined that China should not displace America'

‘Biden’s emerging China strategy, while still protean, sounds of a kind with Mr Doshi’s prescription for “blunting and building”.’
July 15, 2021

Didi: Xi Surprises Us Again

Beijing shocked the financial world when it pulled the rug out from under Didi days after its IPO on the New York Stock Exchange and also announced new regulations reigning in overseas IPOs and Chinese companies already listed.
July 8, 2021

The Chinese Point of View

Here are a few of my thoughts on the importance of Wang Jisi’s ‘The Plot Against China.’ Yuen Yuen Ang’s ‘The Evolution of Chinese Corruption’ speaks for itself - but note especially how Mr. Xi's anti-corruption campaign could hurt China's economy. I have now lived long enough that when a friend complains about his or her spouse, I say to myself, ‘There are no doubt two sides to this story.’
July 4, 2021

'How Corruption Powers China's Economy'

‘China has managed to sustain four decades of economic growth despite levels of corruption that even Xi has described as “grave” and “shocking.” Why does it seem to have bucked the trend?’
July 4, 2021

'How Beijing Sees U.S.-China Relations'

‘In Chinese eyes, the most significant threat to China’s sovereignty and national security has long been U.S. interference in its internal affairs aimed at changing the country’s political system and undermining the CCP.’
July 4, 2021

Five Themes that Point to Where the Chinese Communist Party & China are Heading

As the Chinese Communist Party begins its second century, it’s useful to identify enduring patterns that might aid us in understanding China today and the directions it might be heading.
July 1, 2021

From Rebel to Ruler: One Hundred Years of the Chinese Communist Party by Tony Saich

‘In our discussions, you've identified five themes that have been more or less consistent throughout the history of the party but have oscillated between different points on a continuum:’
July 1, 2021

'From Rebel to Ruler': Tony Saich on Chinese Communism at 100

‘At so many points during its century-long existence, the CCP appeared to be in its death throes, whether as a result of external attack or self-inflicted internal strife.’
July 1, 2021

'Jimmy Lai & the Death of Free Speech in Hong Kong'

Jimmy Lai’s tabloid, the Apple Daily, with its peculiar blend of scandal, gossip, and serious political reporting, was Hong Kong’s indispensable voice of free speech. Now that voice has been silenced, and Lai is in prison with others who tried to protect the right of Hong Kong’s citizens to speak and write freely, to be ruled by law, and to vote for their own autonomous government. Their politics are diverse Yet they stand together. When freedom is under siege, people cannot afford the narcissism of small differences that is tearing apart liberal politics in countries where people think democracy can be taken for granted.
June 27, 2021

'European Companies in China: Between Decoupling and Onshoring'

‘Instead of leaving the market, European companies are exploring ways to separate their China operations from their global ones.’ ‘Following the Covid-19 outbreak, European companies in China spent the first few months of 2020 solemnly appraising their investment strategies.’
June 27, 2021

'How China & America Should Compete'

‘China and the West urgently need a new framework for understanding the state of the world and their place in it. Such a framework must recognize, first and foremost, that properly regulated economic competition is not a zero-sum game.’
June 27, 2021

European Chamber in China: 'Business Confidence Survey'

A mere 9% of European companies are considering moving any current or planned investment out of China, the lowest level on record. Instead, companies are strengthening their positions in JVs, onshoring supply chains and increasing spending to secure market share. The ambition not only to stay but also to expand their China footprint is more than justcapital flooding in due to optimism about growth. Companies are taking action to secure their operations in China and mitigate exposure to geopolitical trends in order to have a better chance of navigating a future that looks to be fraught with risk, at least in the near- to medium-term.
June 27, 2021

Bitcoin’s growing energy problem: ‘It’s a dirty currency'

“Bitcoin alone consumes as much electricity as a medium-sized European country.”
June 24, 2021

The End of 'Apple Daily' - and Freedom of the Press in Hong Kong

Through arrests and freezing of assets, Beijing has forced the closing of Hong Kong’s last pro-democracy newspaper, the Apple Daily.
June 24, 2021

'Hong Kong’s Apple Daily newspaper folds under government pressure'

Apple Daily was much more than a newspaper. To its fans, it was a defender of freedoms. To its foes, it was the defiler of national sovereignty.’
June 24, 2021

'Congress on China: Then and Now'

‘With the Senate voting on June 8, 2021, to adopt the United States Innovation and Competitiveness Act, it is safe to say that this is the most comprehensive action by Congress on China policy EVER.’ ‘The language of the United States Innovation and Competitiveness Act is about a long-term competition with China as opposed to war with an enemy.’
June 24, 2021

'China steps up crackdown on bitcoin mining industry'

‘China’s latest intervention places further pressure on what was once one of the world’s most vibrant markets for trading and mining digital currencies.’ ‘It comes at a time when many governments are scrutinising the industry’s effect on the environment and determining the types of financial oversight that should be applied to cryptocurrencies.’
June 24, 2021

'Apple Daily closed, but press freedom stays in Hong Kong'

‘Freedom of the press is a good thing. The West's freedom of speech must be consistent with national interests and public security.’
June 24, 2021

‘Why do business and political leaders in the West persist in getting China so wrong?’

From that I suggested that to invest successfully in China, you have to understand – and be aware of - what those differences are.
June 20, 2021

‘Why do business and political leaders in the West persist in getting China so wrong?

‘Why do business and political leaders in the West persist in getting China so wrong?’
June 20, 2021

Part 2 | 'Is China exporting inflation?'

“Is China exporting inflation? In renminbi terms, it’s not so obvious. But in U.S. dollar terms, it starts to get more sizable.” ’
June 17, 2021

Part 1 | 'Is China exporting inflation?'

‘Beijing is moving swiftly to protect its factories and workplaces from rising costs.’ ‘Still, rising prices in China, by far the world’s biggest manufacturer and exporter, could be felt around the world.’
June 17, 2021

'Back-to-Back Rebukes of China Mark a Turning Point'

‘The one-two punch of public criticism smacks directly into Mr. Xi’s assertion that China won’t stand for lecturing by other nations, suggesting anxiety in key capitals is prompting governments to seek alignment with the U.S. over attempting to manage the relationship with Beijing on their own.’
June 17, 2021

Bernie Sanders: 'Don’t Start a New Cold War With China'

‘The pendulum of conventional wisdom in Washington has now swung from being far too optimistic about the opportunities presented by unfettered trade with China to being far too hawkish about the threats posed by the richer, stronger, more authoritarian China that has been one result of that increased trade.’
June 17, 2021

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