‘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.’
‘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.’
‘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.’
If a recovery led by investment in real estate and industrial production, with consumption lagging behind, sounds familiar, it may be because the same could be said of the makeup of China’s growth before Covid-19.’
‘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.’
‘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.’
‘A “Democratic-10” or “D-10” is aimed at rallying the world’s most powerful democracies around a common cause— advancing a rules-based democratic order based on shared values and common interests.’
‘Biden has taken the vital first step of correctly diagnosing the strategic challenge facing the country.’ ‘Like Harry Truman at the start of the Cold War and George H. W. Bush at its end, the president now has an opportunity to create a framework for a new era.’
‘Even though China does not pose a direct military threat to NATO, contrary to Russia or terrorist groups, Beijing’s growing economic influence and diplomatic assertiveness in Europe coupled with its growing military relationship with Russia do have major implications for the transatlantic economy as well as its security.’
‘The predominant feature of Chinese conduct today is not grand strategy but a belligerent, defensive nationalism that lashes out without heed of consequences.’ Sometime in 2020, China came unmoored from its grand strategy.
Trend: Under the Xi Jinping administration, China has amped up abrasive ‘Wolf Warrior’ diplomacy; cracked down within its borders, despite protests and criticisms from other countries; become increasing bellicose in responding to those protests and criticisms, and any other pushback it doesn’t like; and increased its aggressive rhetoric and actions against neighbors. Risks: If this sounds like a problem just for the world’s Ministries of Foreign Affairs, think again – the impact extends deep into business and finance.
'Just as Brzezinski foresaw the two new contending blocs –– requiring greater “geostrategic skill” –– that are forming today, Kissinger has emphasized the unprecedented dangers that AI could introduce into a divided world.’
‘To counter U.S. coalition building, China has enhanced its diplomatic, economic, and military relationship with both Russia and Iran in recent months, resulting in the closest ties these countries have had in the post-Cold War era.’
‘Throughout President Joe Biden’s first 100 days in office, his administration has largely continued the Trump administration’s hawkish approach toward China.’ ‘President Biden has also made international coalition building to confront the growing power and influence of China his primary foreign policy initiative.’ ‘Chinese leaders and the public are not convinced by the statements recently made by President Biden that these U.S.-led alliances are “not anti-Chinese” and that the United States is “not looking for confrontation” with China.’
And that is what makes Cheng Li’s ‘Biden’s China strategy: Coalition-driven competition or Cold War-style confrontation?' so valuable. Cheng has decades of close relationships with China’s leaders and high officials. They trust him not to attribute their comments and so speak freely and honestly to him. Cheng is the person I rely on most to convey China’s positions.
‘From Beijing’s perspective, the hawkish approach to China in the final year of the Trump administration revealed that the Trump team sought to defeat and destroy China in much the same way that the United States defeated the Soviet Union in the Cold War.’
‘Beijing has a two-pronged approach to maintaining economic growth as its population shrinks.’ ‘First, it intends to slow the decline of the urban workforce by raising the retirement age and encouraging migration of more of the country’s 510 million rural residents to cities.’ ‘Second, it plans to raise productivity -- a measure of economic output per worker -- with the latest five-year plan emphasizing better vocational education and more investment in scientific research, automation and digital infrastructure.’ [see second chart above]
‘The old maxim ‘demography is destiny’ no longer holds in the same way that it used to.’ ‘A shrinking and ageing population may not have the same gloomy implications in the 21st century.’
‘A rise in China’s male-female ratio may have contributed to between one-third and one-half of the increase in its trade surplus with other countries.’ ‘The sex imbalance thus likely underpins an important source of tension between China and the US. Yet bilateral engagement has paid scant attention to this linkage.’
The census showed that the number of births nationwide fell to the lowest level since 1961, following a nationwide, manmade, famine caused by Mao’s “Great Leap Forward” that killed tens of millions of people, and that China’s total population could peak in the next few years.
The census showed that the number of births nationwide fell to the lowest level since 1961, following a nationwide, manmade, famine caused by Mao’s “Great Leap Forward” that killed tens of millions of people, and that China’s total population could peak in the next few years.
‘Over the past two generations, China has seen a collapse in fertility, exacerbated by Beijing’s ruthless population-control programs.’ ‘With decades of extremely low fertility in its immediate past, decades more of that to come, and no likelihood of mass immigration, China will see its population peak by 2027.’
‘Beijing has a two-pronged approach to maintaining economic growth as its population shrinks.’ ‘First, it intends to slow the decline of the urban workforce by raising the retirement age and encouraging migration of more of the country’s 510 million rural residents to cities.’ ‘Second, it plans to raise productivity -- a measure of economic output per worker -- with the latest five-year plan emphasizing better vocational education and more investment in scientific research, automation and digital infrastructure.’ [see second chart above]
‘Over the past two generations, China has seen a collapse in fertility, exacerbated by Beijing’s ruthless population-control programs.’ ‘With decades of extremely low fertility in its immediate past, decades more of that to come, and no likelihood of mass immigration, China will see its population peak by 2027.’
‘A rise in China’s male-female ratio may have contributed to between one-third and one-half of the increase in its trade surplus with other countries.’ ‘The sex imbalance thus likely underpins an important source of tension between China and the US. Yet bilateral engagement has paid scant attention to this linkage.’
‘The old maxim ‘demography is destiny’ no longer holds in the same way that it used to.’ ‘A shrinking and ageing population may not have the same gloomy implications in the 21st century.’
“This business model only really fits and works in China. But then you’re married to China.” ‘The Chinese government was starting to pass laws that gave the country greater leverage over Apple, and Mr. Xi would soon start seeking concessions. Apple had no Plan B.’
"The massive and complete supply chain ecosystem in China is key to the iPhone maker's success, but it has also created a gigantic organism that would struggle to move somewhere else."
‘But just as Mr. Cook figured out how to make China work for Apple, China is making Apple work for the Chinese government.’ ‘Behind the scenes, Apple has constructed a bureaucracy that has become a powerful tool in China’s vast censorship operation.’
“This business model only really fits and works in China. But then you’re married to China.” ‘The Chinese government was starting to pass laws that gave the country greater leverage over Apple, and Mr. Xi would soon start seeking concessions. Apple had no Plan B.’
‘By removing de jure term limits on the office of the presidency — and thus far refusing to nominate his successor for this and his other leadership positions — Xi has solidified his own authority at the expense of the most important political reform of the last four decades: the regular and peaceful transfer of power.’
‘This talk is designed to cut through the tech and legal jargon, and lay out the top-level strategic rationale underpinning China's thinking on data. We'll cover:’
‘This talk is designed to cut through the tech and legal jargon, and lay out the top-level strategic rationale underpinning China's thinking on data. We'll cover:’
A new risk to add to your analyses and strategic planning: A succession crisis in China. By removing term limits on his stay in office and by not naming a successor, Secretary General Xi Jinping ‘has pushed China towards a potential destabilising succession crisis, one with profound implications for the international order and global commerce,’ writes Richard McGregor of the Lowy Institute and Jude Blanchette of the Center for Strategic & International Studies
‘Even if the CCP’s claim that Xi Jinping has no designs to remain in office for life is true, his evisceration of succession norms leaves the country ill-prepared for his sudden death or incapacitation.’
‘We must make regime change in China the highest goal of our strategy towards that country.’ ‘The US and its allies cannot dictate to China the political system by which it is governed. But they can and must engineer conditions which embolden and enable those in China who also want regime change to achieve it.’
A new risk to add to your analyses and strategic planning: A succession crisis in China. By removing term limits on his stay in office and by not naming a successor, Secretary General Xi Jinping ‘has pushed China towards a potential destabilising succession crisis, one with profound implications for the international order and global commerce,’ writes Richard McGregor of the Lowy Institute and Jude Blanchette of the Center for Strategic & International Studies
‘We must make regime change in China the highest goal of our strategy towards that country.’ ‘The US and its allies cannot dictate to China the political system by which it is governed. But they can and must engineer conditions which embolden and enable those in China who also want regime change to achieve it.’
‘By removing de jure term limits on the office of the presidency — and thus far refusing to nominate his successor for this and his other leadership positions — Xi has solidified his own authority at the expense of the most important political reform of the last four decades: the regular and peaceful transfer of power.’ ‘In doing so, he has pushed China towards a potential destabilising succession crisis, one with profound implications for the international order and global commerce.’
‘In this scenario, Xi thwarts the current consensus by handing over his leadership positions to at least one individual from the current Politburo Standing Committee (as per existing regulations).’
‘On Monday, because of an 1,100-year old poem about events 2,200 years ago posted by the founder of food delivery giant Meituan, investors panicked, and sank the company’s market cap by $15.6 billion. And Meituan CEO Wang Xing, who posted the poem, lost $2.5 billion of his wealth.’
‘China’s cities are plagued by a diverging trend: high demand and exorbitant prices for residential properties in tier 1 cities and yet an oversupply in smaller, lower-tiered cities.’
‘China is marshaling its full range of capabilities to intensify pressure on Taiwan below the threshold of conflict.’ ‘Beijing's goal is to constantly remind Taiwan's people of its growing power, induce pessimism about Taiwan's future, deepen splits within the island's political system and show that outside powers are impotent to counter its flexes.' ‘Its approach is guided by the Chinese aphorism, "Once ripe, the melon will drop from its stem [瓜熟蒂落]," ’‘This strategy may require more time than war, but it would come at less cost and risk to Beijing.’
‘While the U.S. talks up the medium-term military threat, the democratic island sees the moves as part of a bigger, more immediate problem: "gray zone" warfare from Beijing that is meant to wear down the morale of not just the Taiwanese military, but also the island's people.’
‘Taiwan is an arena for the rivalry between China and America.’ ‘Although the United States is not treaty-bound to defend Taiwan, a Chinese assault would be a test of America’s military might and its diplomatic and political resolve.’
‘China's top priority now and in the foreseeable future is to deter Taiwan independence rather than compel unification,’ note Richard Bush (Brookings (retired)), Bonnie Glaser (German Marshall Fund in America), and Ryan Hass (Brookings Institution)
"Taiwan poses the biggest geopolitical risk in Asia and is likely to only increase, a reason it has to be built into investors’ [and corporates' models]" according to Arthur Kroeber, head of research at Gavekal.
‘Senator Marco Rubio of Florida has a point when he calls Delta Air Lines “the height of hypocrisy” for opposing voter legislation in the US state of Georgia while partnering with a government he accuses of being “actively engaged in genocide” in Xinjiang.’
At their summit in April, ‘after years of veiled messaging Japanese Prime Minister Yoshihide Suga U.S. President Joe Biden, ‘formally acknowledged that they are working together to deter China’s military power in Asia and compete with China economically.’
‘China's new digital renminbi by itself will not help the currency to challenge the US dollar’s global dominance.’ ‘Its true significance instead lies in its potential to shift the competitive balance of power between the country’s technology giants and traditional banks.’
I recently received an email from a former U.S. ambassador and influential senior foreign policy expert taking me to task for publishing so many hawkish posts about U.S. policy toward China in the ‘China Macro Reporter.’ These are, he said, ‘in some ways fanning the flames of a potential war. Please back down, at least a bit.’ ‘This is not the Malcolm I remember or know,’ he ended.
‘A trend for hostility toward China, inflamed under Trump, is a recipe for American failure.’ ‘Hostility toward China, much of it misinformed historically and strategically, has deepened in the United States in recent years, with a consensus hardening among both Republicans and Democrats that China is at root an adversary that must be thwarted.’ ‘Four years under President Donald Trump have enlarged and inflamed that trend, but it is a recipe for American failure.’ ‘The Joe Biden administration needs to seriously rethink Washington’s approach to Beijing.’
‘The upgrades in global growth for 2021 and 2022 are mainly due to upgrades for advanced economies, particularly to a sizeable upgrade for the United States (1.3 percentage points) that is expected to grow at 6.4 percent this year.
Friday, April 30, marks 100 days of the Biden Presidency.On Thursday, President Biden gave a speech to a Joint Session of Congress that summed up many of policies – including those on China - as he nears the 100-day mark.And several major media outlets and think tanks are getting an early start on their analyses.Here's Senator Lindsey Graham: "I'm not very impressed with the first 100 days.”‘ "He's been a disaster on foreign policy.” ’‘ “Russia and China are already pushing him around, so I'm very worried." ’
‘Biden is focused on accumulating as much leverage as possible to deal with China from a position of strength and to dispel the growing Chinese perception that the United States is a power in decline.’
‘What we have learned from the first 100 days is that we are likely to have both a confrontational and competitive relationship with China, similar to Trump’s policy but with some important nuances.’
‘It is natural for the two sides to have competition in some fields, but we should advocate fair competition, like competing with each other for excellence in a racing field, not beating each other on a wrestling arena.’
‘The United States, China, and India are each now engaged in what seems like a paradoxical enterprise: the quest to increase their global status while also turning inward to become more self-sufficient.’
‘The centralization of power, quite predictably, leads to this kind of echo chamber effect, which is really quite dangerous. And it's something that we should be factoring in when we think about how to deal with China now.’
‘The bill is full of Cold War mentality and ideological prejudice, wantonly misinterpreting, slandering and discrediting China's development strategy and domestic and foreign policies, and grossly interfering in China's internal affairs.’
‘The Strategic Competition Act codifies a bipartisan U.S. position on a range of China-related issues and telegraphs to U.S. allies the federal government is unified.’
‘Xi’s reticence at the summit could be driven by domestic considerations. He needs to balance divergent interests between domestic industrial groups and international expectations, the need to show China’s green image and also not be seen as caving to U.S. diplomatic pressure.’
‘In this scenario, Xi thwarts the current consensus by handing over his leadership positions to at least one individual from the current Politburo Standing Committee (as per existing regulations).’
"We advise Japan to stay away from the Taiwan question. The deeper it is embroiled in, the bigger the price it will pay." Communist Party-backed Global Times' editorial.
‘Even if the CCP’s claim that Xi Jinping has no designs to remain in office for life is true, his evisceration of succession norms leaves the country ill-prepared for his sudden death or incapacitation.’
‘By removing de jure term limits on the office of the presidency — and thus far refusing to nominate his successor for this and his other leadership positions — Xi has solidified his own authority at the expense of the most important political reform of the last four decades: the regular and peaceful transfer of power.’
‘We must not let the rules set by one or a few countries be imposed on others, or allow unilateralism pursued by certain countries [read America] to set the pace for the whole world.’
April 15 was not a normal Thursday in Hong Kong. That occasion, the first “National Security Education Day” since China imposed a tough security law in June, was the most visible display of Hong Kong’s fall from a relatively free, boisterous territory to an Orwellian place that resembles the repressive mainland.’
‘The US-Japan Joint Leaders' Statement grossly interferes in China's domestic affairs and severely violates basic norms governing international relations. China deplores and rejects it.’
‘President Biden and Prime Minister Suga exchanged views on the impact of China’s actions on peace and prosperity in the Indo-Pacific region and the world, and shared their concerns over Chinese activities that are inconsistent with the international rules-based order, including the use of economic and other forms of coercion.’
'The Relevant Organs' Pro Tip: 'You Definitely Need a Show Trial'
Spitballing here, GOP friends, but Josh Hawley, Ted Cruz, Ron Johnson and Marjorie Taylor-Greene would make an excellent Gang of Four, if you need a show trial.