Sitrep China : Smörgåsbord of notable international data points (and a little opium war)

A great and modern China history from the Epic China series by Nathan Rich:  How China Fell into the Opium Wars (1793-1838)

 


Data Points

Ed: China will not have anything resembling a monopoly structure in business and ever-popular Jack Ma is having his knuckles rapped through a series of actions, starting with not allowing Ant Group its biggest IPO in the world ever, in Hong Kong and now Alibaba has been fined:  China’s market regulators imposed an 18.2 billion yuan ($2.8 billion) fine on Alibaba, which amounts to 4% of the company’s revenues in 2019.

  • Regulators lift standards for finance execs to bring once freewheeling fintech giants like Ant Group into line. They require high social credit scores for directors, supervisors, and senior executives who “have a big impact” on the operational management.
  • Ed: Many Saker blog readers know a lot about CHIPS (semi-conductors) and we’ve speculated in the past on what China’s actions are going to be regarding CHIP sanctions.  Now, we’re beginning to see the actions:
  • Chinese semiconductor equipment company AMEC said its etching equipment has been used in a tier-one customer’s 65 nm, 14 nm, 7 nm, and 5 nm lines. Plasma etchers perform microscopic engraving on chips with a precision of tens of thousandths of a hair’s diameter. AMEC’ etching equipment revenue was $197 million in 2020, up 60% YoY. 
  • Shanghai Tianshu Zhixin launched Big Island, China’s first homegrown 7nm GPGPU (General-Purpose Graphics Processing Unit) chip, which can complete the artificial intelligence processing of hundreds of camera video channels per second. Its performance is twice that of mainstream products in the market. 

Ed: Higher Education:  Since Chinese students are generally being made unwelcome to study in the west, China did not miss a beat and most of the IVY’s and notable universities now have campuses in China.  The education to my understanding is more free-wheeling as in a western style, but students still have to take the required courses in Marxism and ideology.  It is mind-blowing how China takes everything thrown and simply turns it around into another opportunity.  “You don’t like us there, well, we’ll just get together over here!”  (No, China did not steal the US jobs – they walked off all by themselves as a result of insane policies and a bloated industrial cost structure – now, US, you’re losing your students and your source of educated workers and no doubt, we will hear the cries:  ‘China stole our students!’.)

  • International schools in China are booming as Covid-19 travel restrictions limit the number of students seeking education overseas. Demand is particularly high in the mainland portion of the Greater Bay Area, which has had fewer international schools than Beijing and Shanghai. 

Ed: Money makes the world go round:

  • The World Bank is still the largest creditor in poor countries at $106 billion but China is close at $104 billion. In sub-Saharan Africa, China (US$62 billion) has outspent the World Bank (US$60 billion) as the biggest official lender to Africa’s poor countries.   

Ed: China’s influence mostly in the creation of infrastructure in terms of Belt and Road methodology is becoming very visible and seemingly no area of the world is too far away:

  • Guinea:  With the fourth and final generator successfully connected to the grid at the end of March, Guinea’s Souapiti 450MW hydropower station, above, became fully operational, doubling Guinea’s power generation capacity and turning it from a blackout stricken country into an electricity exporter. 
  • Logistics:  China has the world’s largest and fastest-growing logistics market. It grew from $300 billion in 2001 to $2 trillion in 2018. A select few traditional logistics players have begun transforming their businesses to respond to these drastic changes in China’s logistics industry. As they adapt, three trends have developed. 
  • Brazil: Petrobras has signed a $10 billion loan from China Development Bank to cover its massive debt burden for 2022, and says the loan comes with supply commitments to Chinese buyers. 
  • In 2019, the PRC surpassed the US as the leading trade partner with Brazil, Chile, Peru, and Uruguay and is now the region’s second-largest trading partner behind the US. Trade with Latin America soared from $17 billion to $315 billion between 2002 to 2019, with plans to reach $500 billion by 2025,” SOUTHCOM’s Admiral Craig Feller told the Senate Armed Services Committee. 

Ed: We have gotten accustomed to the superb level of diplomatic skill by Russian diplomats under the leadership of Foreign Minister Lavrov.  Up to now, the generally accepted idea was that China is in a sense leaving the global diplomatic task (as well as the military task) up to Russia in their partnership.  The new news is that China is joining the ranks of the superb diplomats and slowly picking up its own diplomatic function.

  • Russia and China agree to develop infrastructure via the Belt and Road Initiative; promote dialogue among civilizations; a two-state solution for Israel and Palestine; promote policies of non-proliferation of nuclear weapons; and collective security with a focus on new and enhanced Middle East Trust mechanisms. 
  • Post-Iran-China, it’s not far-fetched anymore to even consider the possible emergence in a not too distant future of a Himalaya Silk Road uniting BRICS members China and India (think, for instance, of the power of Himalayan ice converging into a shared Hydropower Tunnel).

Ed: Explosive news of the week was the speech by Russia’s Security Council Secretary Nikolai Patrushev.  What is notable here is that he states not only the Russian position but combines it with the Chinese position.  We should understand from that, that both countries are of one mind – the US-controlled Biolabs in far-off places must be investigated.  This is an outflow of the ‘China virus’ accusations from the US.  Watch this space – we will no doubt see more developments here.

  • “Let me draw your attention to the US-controlled, permanent biological laboratories that appear mainly near Russian and Chinese borders, where outbreaks of non-typical diseases were recorded in the areas where those laboratories are located, said Security Council Secretary Nikolai Patrushev. [The US is the only country blocking a verification mechanism under the 1972 Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on Their Destruction]. 

Ed: And of course, we cannot help but end this data point section on a low note from a losing old SourPuss and its few lame ‘allies and partners.

  • The US considers boycotting 2022 Beijing Olympics, says US State Department: “‘It [a joint boycott] is something that we certainly wish to discuss. A coordinated approach will not only be in our interest but also in the interest of our allies and partners.” 

Ed: May I then be the first one to declare that it is folly to March on Beijing with a Trade War.  The next longer read will explain.


Longer Read

Martin Jacques: The Communist Party of China (CPC) is like no other party in the world. It requires us to rethink the very idea of what a political party is. It is a phenomenon intrinsic to China. It is ineluctably Chinese. If the imperial dynasties defined Chinese governance for two millennia, the CPC has assumed similar importance since 1949. There has been an overwhelming failure to grasp the nature of the CPC in the West. This ignorance reached new heights after 2016.


Jeff J Brown, Cynthia Chung and Matt Ehret on China

 

Via http://thesaker.is/sitrep-china-smorgasbord-of-notable-international-data-points-and-a-little-opium-war/