Page 1: A couple of stories to note. First, the phone call between Xi Jinping and French President Emmanuel Macron (Xinhua English version). In the English story, Xinhua reports that the two leaders reached an “important consensus.” Tricky to summarise this, so here’s the text:
“Calling ‘independence, mutual understanding, foresight, mutual benefit and win-win outcomes’ as the original aspiration of the establishment of diplomatic relations between China and France, Xi noted that it is an important consensus of the two countries to uphold multilateralism, safeguard the international system with the United Nations at its core and maintain the international order based on international convention. The two countries, he said, should stay true to their original aspiration, adhere to their consensus, firmly hold the steering wheel of China-France relations, strengthen exchanges, deepen cooperation, maintain close communication and coordination on major international and regional issues, so as to push for greater development of the bilateral relations. Xi stressed that China has full confidence in its own path, theory, system and culture, and respects the development path independently chosen by the people of other countries. Countries with different social systems are able to respect each other, coexist peacefully and seek common development, he said.”
There are 8 areas that they’ve identified for cooperation, as per the Chinese side. Interestingly, the EU-China investment treaty is among those eight. What’s interesting is that this call comes just ahead of the EU leaders summit on Thursday and Friday. Read more on what that summit yielded from a China perspective in my weekly Eye on China newsletter on Sunday. Anyway, here’s the official readout from Macron’s office. It talks about key areas of cooperation, climate change, the Iran nuclear issue, public health, multilateralism, working together in Africa, and so on. But it doesn’t include the 8-point consensus and also mentions that Macron “expressed the deep concern of France and its European partners over the deterioration of the human rights situation in China, in particular in Hong Kong and Xinjiang.”
While talking about Europe and China, also look at this SCMP story based on the “Nato 2030” report, which reflects a bigger, more hawkish shift in Europe on China over the last year. The shift, the story says, “was prompted by a mix of concerns, from China’s technological advancement, and slow progress on opening up to foreign companies, to its geopolitical influence in the developing world; and moves Europe closer to the US position on China.”
Here’s an excerpt from the NATO 2030 report: “NATO must devote much more time, political resources, and action to the security challenges posed by China — based on an assessment of its national capabilities, economic heft, and the stated ideological goals of its leaders. It needs to develop a political strategy for approaching a world in which China will be of growing importance through to 2030. The Alliance should infuse the China challenge throughout existing structures and consider establishing a consultative body to discuss all aspects of Allies’ security interests vis-à-vis China. It must expand efforts to assess the implications of China’s technological development and monitor and defend against any Chinese activities that could impact collective defence, military readiness or resilience in the Supreme Allied Commander Europe’s (SACEUR) Area of Responsibility.”
Also this: “Emerging and disruptive technologies are a challenge but also opportunity for NATO. Competing with the efforts underway by large authoritarian states to achieve dominance in key EDTs must be a strategic priority for the Alliance and its members.”
Next, Li Keqiang chaired the weekly State Council meeting, which focussed on improving financial services and promoting the development of personal insurance. This is what Li said: “We must focus on key areas, especially the medical insurance or commercial health insurance. More types of insurance targeting critical illnesses shall be supported and aligned with the basic medical insurance system as supplement to enhance critical illness insurance protection for urban and rural residents.”
Finally, a long piece looking ahead at the upcoming annual Central Economic Work Conference. It essentially focuses on what’s been done through the 13th-FYP period under Xi’s leadership, and talks about how the CEWC will set the stage for the next round of development. Here’s a snapshot of Xi’s remarks over the years at the CEWC.
- In 2016, for the first time, it was emphasized that “the general tone of the work of seeking progress while maintaining stability is an important principle for governing the country.”
- In 2017, it was clearly stated that “my country’s economic development has also entered a new era. The basic feature is that my country’s economy has shifted from a stage of rapid growth to a stage of high-quality development”
- In 2018, once again stated that “my country’s development is still and will be in a period of important strategic opportunities for a long time”
- In 2019, it firmly pointed out that “the basic trend of my country’s economy being stable and improving in the long term has not changed.”
Page 3: A few pieces to note. First, a story about CCP engagement with political parties around the world. It talks about the different political parties that have commended the CCP on pandemic containment and poverty alleviation. For anyone researching this area, it’s a useful piece with neat categorisation mentioning parties based on regions. Next, a piece about Defense Minister Wei Fenghe’s remarks at the 14th ASEAN Defense Ministers’ Meeting. The English version has the same details. Wei said that China and countries from the Association of Southeast Asian Nations (ASEAN) have the wisdom and ability to properly handle the South China Sea issue and jointly safeguard the peace and stability in the region. The China-ASEAN defense and security cooperation is deepening, and it has become a model for regional security cooperation.
Finally, here’s a commentary about China-US ties following the sanctioning of lawmakers linked to the HK national security law. It says that “the barbaric acts of the U.S. side will only further stir up the strong indignation of the Chinese people against the anti-China forces of the U.S., making the 1.4 billion Chinese people, including our compatriots in Hong Kong, fully understand the evil intentions of the U.S. side, and reinforcing the Chinese government’s determination to enforce Hong Kong’s national security laws, crack down on anti-China activities in Hong Kong, and maintain the long-term prosperity and stability of Hong Kong.”
Next, there’s a piece based on MoFA’s comments to a question regarding a new survey of British businesses in China. Zhao Lijian called it a “vote of confidence in the prospects for China’s economic development and business environment.” The survey measures the outlook of and challenges facing the China operations of more than 250 British companies. Here are some key findings:
- For 32% of all companies and for 51% of large multinationals, revenue from China accounts for less than 10% of their total global business earnings before interest and tax. At the same time, more than one quarter of companies derive more than 50% of their total revenue from the Chinese market, of which 93% are SMEs.
- Despite the uncertainties and challenges of the past year, British businesses in China remain broadly optimistic. Nevertheless, business sentiment has declined over the past three years, with 49% reporting an optimistic outlook for 2021, down from 54% last year for 2020. Instead, companies are becoming increasingly neutral in their outlook, while pessimism remains low.
- British businesses will by and large either increase or maintain their current level of investment in China for the next year…only 7% of businesses will decrease investment next year… these are largely SMEs.
- 45% British businesses in China find that their operations are impeded by market access barriers. This is down somewhat from last year, when 54% of companies faced such barriers. Healthcare, IT and telecommunications, and energy are the most restrictive sectors
- One quarter of companies believe that FIEs in their industry receive unfavourable treatment compared to Chinese private companies. This perception significantly worsens when concerning competition with SOEs.
- Previous surveys had shown that 22% of companies anticipated that the Foreign Investment Law would have a positive impact on their operations in China, but, since its implementation, only 16% have actually seen a material benefit to their operations.
- Roughly half of British businesses are taking some form of action as a result of geopolitical tensions involving China. However, these actions seem to vary significantly, with an equal number of companies (14%) accelerating investment decisions and delaying or cancelling investment decisions. Only 3% are considering leaving the China market completely as a result of geopolitical tensions. 44% of companies are not taking any action at all.
- The question of supply chain relocation is largely irrelevant to just over half of British businesses in China, which report that they do not source from or manufacture in the Chinese mainland. Of those companies that do source or manufacture in China, 88% report that they are not considering changing their current supply chains. Only 3% of companies have actively started relocating manufacturing or sourcing to an area outside of the Chinese mainland, despite growing political pressures to decouple from China and initial expectations that the pandemic would lead to a significant reordering of global supply chains away from China.
Page 4: First, Vice Chairman of the Standing Committee of the National People’s Congress (NPC), President of the Chinese Society of Law Wang Chen attended the ninth session of the “National Outstanding Young Jurists” award ceremony. He called on young legal workers to “study and practice Xi Jinping’s Thought on rule of law, creating examples and effectively implementing “this scientific theory” into the work of the comprehensive rule of law. The most important bit: “We should always adhere to the leadership of the Party, adhere to the correct political direction, and unswervingly take the socialist rule of law road with Chinese characteristics.”
Second, a bit about how grassroots propaganda mobilisation works in China. So here’s a report about different provinces creating propaganda teams to disseminate the dominant messages after the 5th Plenary. The piece says that “So far, Jilin province has organized more than 1,500 preachers to carry out more than 3,000 preaching activities, the audience of more than 200,000 people.” Likewise activities were carried out in Heilongjiang and Hubei and Hunan. In the former, “highly qualified Party members and cadres were selected as preachers to deliver accurate preaching; and cadres and masses were organized to provide accurate feedback, evaluate each preaching and improve. The city of Mishan created the “Wisdom of Mishan” APP, which regularly publishes grassroots propaganda dynamics and records online propaganda videos, with 61,000 registrants.”
Another example is from Hunan, where the Provincial Party Committee Propaganda Department, in cooperation with the Youth League Provincial Committee, has organized a province-wide youth dialogue on the theme of “where are you in 2035.” This essentially is asking people to imagine a future with automatic cars, AI and so on, drawing on key Party development themes.
Page 7: On the theory page today, here’s a piece by Wei Ling, professor at the School of Marxism at the China University of Political Science and Law, on improving global governance. Wei writes that this is “not about overthrowing (the system) or starting anew, but keeping pace with the times, innovating and improving, so that the changes in the global governance system can better reflect the changes in the international landscape and more effectively safeguard world peace and development.”
Here’s Wei’s take on American power: “Although hegemonism and power politics impede global governance and affect world peace and development, their practices are becoming increasingly unworkable.”
Wei’s take on Xi’s approach: China has “continued to expand cooperation with countries around the world in multiple fields to enhance the common interests of all countries, and contribute Chinese wisdom and Chinese solutions to the improvement of the global governance system.”
Here’s another piece covering the themes of domestic propaganda around the pandemic.