Switzerland

• Mongolian and Swiss sides to cooperate in detecting hip dysplasia in infants earlier (Montsame)

Foreign Policy

• Chinese 'hacker' Wang Fujie who obtained details of 78 million people is charged in US with 'one of the worst data breaches in history' (SCMP)
• US blocks China Mobile from offering service in America over national security concerns (SCMP)
• Donald Trump says trade deal with China may still happen after Xi Jinping sent him a 'beautiful letter' (SCMP)
• Rising 'Red Scare' in Washington raises concern over Sino-US ties (China Daily)
• Ex-Swedish envoy to China Anna Lindstedt suspected of crime after setting up 'unofficial' meetings over detained bookseller (HKFP)
• China's Huawei reiterates confidence in CFO's innocence (Xinhua)
• Chinese court holds off ruling on Canadian's death penalty appeal amid diplomatic spat (HKFP)
• Xi to address Conference on Dialogue of Asian Civilizations (Xinhua)
• China urges maintenance, implementation of Iran nuclear deal (Xinhua)

Domestic Policy

• China to step up efforts to cut overcapacity in 2019 (Xinhua)
• County authorities probe chemical liquid leak scandal (Global Times)
• Former Communist Party boss of Yunnan Qin Guangrong investigated for corruption (SCMP)
• China to extend tax preferences for IC, software companies (Xinhua)
• Summit demonstrates China's leapfrog into digital world (Xinhua)
• Chinese AR start-up develops smart glasses to help police catch suspects (SCMP)
• China announces guidelines to promote integrated urban-rural development (Xinhua)

Tibet

Xinjiang

• China slams US for trying to deprive Beijing of UN forum seat over Uygur detentions in Xinjiang (SCMP)

Hongkong

• Administrative wing of Hong Kong's legislature accused of filtering employees by political stance (HKFP)
• 'More Hongkongers will go into exile' – Alleged recording from localist who fled to Taiwan prompts search (HKFP)

Taiwan

• U.S. move on Taiwan question puts China-U.S. ties in jeopardy (Xinhua)
• Beijing blasts US Congress for Taiwan defense bill (China Daily)

Economy

• JPMorgan poised to be first foreign company to own majority stake in China mutual fund venture (SCMP)
• Broader access to attract more global investors (China Daily)

DPRK

• Latest North Korean weapons test was 'long-range strike' drill, state media says, a day after statement from Seoul that missiles were short-ranged (SCMP)
• US seizes North Korean coal ship 'Wise Honest', accuses Pyongyang of violating sanctions (SCMP)
• North Korea fires off more missiles as it ridicules Seoul's objections (SCMP)

Mongolia

• Murun soum to cooperate with Dandong city of China (Montsame)
• Industrial production increases by 17.5 percent (Montsame)

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Mongolian and Swiss sides to cooperate in detecting hip dysplasia in infants earlier (Montsame)
2019-05-09
A Memorandum of Understanding on Cooperation was yesterday signed by Deputy Director of the Health Department of Ulaanbaatar city L.Zendmaa, Director of the National Center for Maternal and Child Health Sh.Enkhtur and a founder of Swiss-Mongolian pediatric project (SMOPP) Tomas Baumann. As reflected on the memorandum, within the Swiss-Mongolian pediatric project, ultrasound diagnostic apparatus, infant check-up beds for hospital examination, harnesses for treatment and other necessary materials will be donated to Urguu, Khuree and Amgalan maternity houses and Health Centers in Nalaikh and Baganuur districts and training and empowering maternity nurses and specialists. In the frames of the project, ultrasound screening inspection for hip dysplasia in babies has being made successfully at the national level and a total of 308.254 newborns have been involved in the screening since 2007, of which 4647 babies are treated with non-surgical methods, being prevented from becoming disabled. "Mongolia has full potential to eliminate disability caused by hip dysplasia and hip dislocation in infants with very low cost" the project team said and conveyed their satisfaction on the cooperation. ^ top ^

Chinese 'hacker' Wang Fujie who obtained details of 78 million people is charged in US with 'one of the worst data breaches in history' (SCMP)
2019-05-10
A US federal grand jury on Thursday charged a Chinese national in a hacking campaign described by the Justice Department as "one of the worst data breaches in history", an effort that yielded the personal data of 78 million people. Wang Fujie, also known as Dennis Wang, and another individual in the indictment, are alleged to have infiltrated the US-based computer systems of US health insurer Anthem and three other companies, the Justice Department said in a statement on Thursday. "The allegations in the indictment unsealed today outline the activities of a brazen China-based computer hacking group that committed one of the worst data breaches in history," Assistant Attorney General Brian Benczkowski, said in the announcement. "These defendants allegedly attacked US businesses operating in four distinct industry sectors, and violated the privacy of over 78 million people by stealing their [personally identifiable information]." The indictment was the latest in a series of efforts by the US Federal Bureau of Investigations to tackle alleged hacking operations and cybertheft emanating from China. The bureau has become increasingly vocal about the country. The second suspect, who was identified in court documents as John Doe and through aliases including Zhou Zhihong, conducted the alleged hacking activities in China. The other three companies affected by the hacks, conducted between February 2018 and January 2019, operated in the technology, basic materials and communication services sectors, according to the department. Information taken from the companies included health identification numbers, birth dates, social security numbers, addresses, telephone numbers, email addresses, and employment information. Wang and Doe obtained personal information by installing malware on the victim companies' computers systems through "spearfishing" emails sent to the companies' employees, according to the indictment, which was filed with the Indianapolis division of the federal court's Southern District of Indiana, where Anthem is based. The information obtained by the defendants was encrypted and sent through multiple computers to destinations in China. The files installed in the victim companies' computers systems were then deleted. Anthem and the other US companies involved notified the FBI when they became aware of the operation, allowing the federal investigators to monitor the activity and trace it to the defendants, according to the Justice Department. The FBI has worked closely with companies in recent years to respond to alleged attempts by Chinese entities to steal information from US companies. GE Aviation, for example, had worked with the bureau for more than a year to lure Xu Yanjun, an alleged spy working for China's Ministry of State Security, into a law enforcement trap in Belgium last year. Xu was then extradited to the US and is now awaiting trial. According to Xu's indictment filed in the Southern District of Ohio, the MSS officer sought GE Aviation technology used in the development of fan blades and engine encasements. FBI Director Christopher Wray has been an outspoken critic of China since he assumed his post in 2017. Last year, Wray accused Beijing of increasing its use of "non-traditional collectors" – such as professors, scientists and students – for its intelligence gathering. "One of the things we're trying to do is view the China threat as not just a whole-of-government threat but a whole-of-society threat on their end, and I think it's going to take a whole-of-society response by us," Wray testified at a Senate hearing in February 2018. Eight months later at another hearing, Wray escalated his rhetoric by declaring China "the broadest, most complicated, most long-term" counter-intelligence threat confronting the US – surpassing even Russia, whose interference in the 2016 election dominated headlines for more than two years and continues to roil the country. Speaking at a separate Senate hearing in December, Bill Priestap, the FBI's assistant director of counter-intelligence, also called for more coordinated action to counter espionage and cybertheft originating in China. "There are pockets of great understanding of the threat we're facing and effective responses, but in my opinion we've got to knit that together better," he said. Warning against what he called "ad hoc responses", Priestap added: "We need more people in government, more people in business, more people in academia pulling in the same direction to combat this threat effectively." ^ top ^

US blocks China Mobile from offering service in America over national security concerns (SCMP)
2019-05-10
US communications regulators on Thursday voted against a Chinese telecoms company's application to provide phone service in the US, citing national-security risks amid escalating tensions between the two countries. The ruling against China Mobile, which is owned by the Chinese government, comes on the day that a Chinese delegation led by top negotiator Liu He arrives in Washington for talks to end the US-China trade war. China Mobile, the world's largest wireless network operator, sought approval in 2011 to provide interconnection services for phone calls between the US and other countries. The Federal Communications Commission on Thursday rejected the application in unanimous 5-0 votes across party lines, following the Commerce Department's recommendation to deny last year. The FCC said the applicant, China Mobile USA, based in Delaware, is "ultimately owned and controlled by the People's Republic of China". Granting the application "would raise substantial and serious national security and law enforcement risks", the FCC said in an announcement on Thursday. The FCC move comes as the US worries increasingly about China's ambition of dominating key industries. Seeking to contain the Asian country's advancement in 5G, or fifth-generation, cellular technology, the Trump administration has tried to deal with it aggressively. The US has also pressured governments globally to sever their relationships with Chinese telecoms equipment makers, albeit with limited success. It says companies such as Huawei and ZTE pose national security threats to countries because of their potential to harvest data for Beijing. Thus, technology has become the thorny issue at the centre of the trade talks, slowing down the two sides' ability to reach a deal. The US has demanded Beijing introduce laws to protect intellectual property rights and halt the forced transfer of proprietary technology from foreign companies operating in China to their Chinese joint-venture partners. Earlier this week, Trump abruptly announced plans to increase tariffs on Friday to 25 per cent from 10 per cent on US$200 billion of Chinese goods. The White House said the escalation was caused by China's back-pedalling on already agreed-upon terms of a possible deal. FCC Commissioner Brendan Carr, at an open meeting of the regulatory authority on Thursday, also called on it and national security agencies to examine Chinese state-owned companies China Unicom and China Telecom. Carr said security threats have changed since the companies, which currently operate in the US, were given permission to enter the US market in the early 2000s. China Mobile, China Unicom and China Telecom did not immediately respond to emailed requests seeking comment. FCC Chairman Ajit Pai said on Thursday that "there is a significant risk that the Chinese government would use China Mobile to conduct activities that would seriously jeopardise the national security, law enforcement and economic interests of the United States". "The Chinese government could use China Mobile to exploit our telephone network to increase intelligence collection against US government agencies and other sensitive targets that depend on this network," he added. The FCC has also proposed cutting off funding for US telecoms companies that use equipment from Chinese companies deemed national-security risks. That could hurt small rural phone companies that have that equipment in their networks. This measure has not been scheduled for a final vote. ^ top ^

Donald Trump says trade deal with China may still happen after Xi Jinping sent him a 'beautiful letter' (SCMP)
2019-05-10
US President Donald Trump said on Thursday that a trade deal with China is "possible" this week and that his Chinese counterpart Xi Jinping had sent him a "beautiful letter" – comments that contrasted sharply with several hard-line tweets he had posted recently. Speaking to reporters just as Chinese Vice-Premier Liu He arrived in Washington for an 11th round of negotiations aimed at ending a trade war between the world's two largest economies, Trump suggested that his order to raise tariffs on US$200 billion of imports from China had helped accelerate the reconciliation process. "We put the tariffs on, we made the statement, and then they upped the meeting. 'How about let's go back to Thursday?'," Trump said after claiming that the Chinese side suggested a delay in talks until a later date. In remarks at the White House, Trump reiterated that he had announced the increase of tariffs on those goods to 25 per cent, from 10 per cent, in response to Beijing's bid to backtrack on a number of fundamental commitments. "We were getting very close to a deal, then they started to renegotiate the deal," he said, adding that one of those areas was protection of intellectual property rights. "So I have no idea what's going to happen," Trump added. "I did get last night a very beautiful letter from President Xi [saying] 'Let's work together, let's see if we can get something done.'" "I like the president a lot," he said of Xi, with whom Trump said he would "probably" be speaking to by telephone. "He's a good friend of mine, but I'm representing the USA and he's representing China, and we're not going to be taken advantage of anymore." Trump confirmed that members of his cabinet would meet with Liu and other members of the Chinese delegation at 5pm on Thursday to kick off talks that are scheduled to continue through to Friday. In light of the Trump administration's move to escalate tariffs, the strategy of US negotiators going into those talks would be "very straightforward," said Scott Kennedy, a senior fellow at the Centre for Strategic and International Studies (CSIS). "The US side says you need to agree to restore everything that we had come to agreement about before [and] remove all those red lines," said Kennedy, an expert in Beijing's economic policy who has testified numerous times in congressional hearings on the trade and economic relationship between the US and China. The choice, he said, would be China's as to whether it wants the negotiations "to move forward or not". Though Trump seemed to connect the participation of Liu – whom he called "one of the highest officials in China" – in this week's talks as a sign that a deal was possible, the vice-premier's status is not as authoritative as it was in some previous rounds. A statement issued by the Chinese Ministry of Commerce ahead of this week's trip did not include the title "Special Envoy to Chairman Xi Jinping" in its list of Liu's credentials. Liu's apparent demotion, combined with the reduced size of the delegation and the short length of stay in Washington, suggested "a narrower range of negotiated topics and room for compromise," Kennedy said. "It could be the higher the stakes, the tighter the decision-making authority is." Reiterating just how high those stakes are should both sides fail to make a deal this week, Trump said on Thursday that US officials were "starting [the] paperwork today" for the imposition of 25 per cent tariffs on US$325 billion worth of Chinese imports not currently subject to the punitive measures. Trump raised the prospect of those new tariffs on Sunday in postings on Twitter, taking many observers by surprise and weighing on markets worldwide this week. On Wednesday, he took to Twitter again to accuse Beijing of playing for time in the hope of negotiating a trade deal with a Democratic administration in 2020. Recent stutters in the talks – which had until last week been hailed by Washington and Beijing as productive and close to a deal – suggested that both sides' fundamental positions remained "pretty far apart from each other," Kennedy said, adding that Trump's conclusion that Beijing was stalling was "not unreasonable". "We may be looking at this being the normal course of events all the way to the election," he noted, though he cautioned that a Democratic administration would likely be just as tough on trade and would even "widen the conversation to be not just about trade and North Korea but about human rights [and] other issues. "And so in that regard it doesn't really get any easier for the Chinese, it gets harder." Meanwhile, the talks in Washington proceed. A smiling Liu He waved to reporters and ignored shouting protestors as he left the USTR on Thursday after around 90 minutes of discussions with US counterparts. He was scheduled to attend a dinner later in the evening with Lighthizer and Mnuchin. ^ top ^

Rising 'Red Scare' in Washington raises concern over Sino-US ties (China Daily)
2019-05-10
The outcry over a senior US State Department official's racist comment against China last week is the latest proof of the growing "Red Scare" in Washington. Kiron Skinner, the department's policy planning director, told a security forum in Washington on April 29 that the competition with China is "a fight with a really different civilization and a different ideology and the US hasn't had that before". She added that "it's the first time that we will have a great power competitor that is not Caucasian". The comment was so shocking that even the usual critical China watchers in Washington did not come out to defend her. Instead, many pointed out that her remarks were way out of line. Skinner's comment was laughable because it showed her lack of understanding of long and rich Asian civilizations such as the Chinese civilization and Indian civilization. She wouldn't have made such a colossal mistake had she taken advantage of the rich resources in the Department of East Asian Languages and Civilizations while studying and teaching at Harvard University. Her comment suggests that Caucasians and Western civilization are superior to Chinese and other races and civilizations. If this is not racism, what is? And being an African-American does not exonerate her for making such racist comment. Most Americans pride themselves as being part of a multi-cultural and multi-racial society. But Skinner's remarks unfortunately show she lacks that appreciation and sensitivity. That is probably why she was quickly reminded by Anne-Marie Slaughter, CEO of New America Foundation who hosted the talk, that the minorities would become the majority population in the US by 2050. Slaughter served as a policy planning chief at the US State Department under the Barack Obama administration. Skinner's words are indicative of the growing "Red Scare" in Washington. They range from spreading canards against Chinese foreign direct investment in the US and the Confucius Institute to blocking visas to Chinese scholars, intimidating countries which intend to include Chinese telecom giant Huawei in their 5G networks and running propaganda videos defaming the China-proposed Belt and Road Initiative. Washington now seems to be against anything and everything that is Chinese. The "Red Scare" is so bad that top US scholars on China are sounding the alarm. Susan Shirk, a top China scholar and former deputy assistant secretary for East Asian and Pacific affairs, warned a month ago that overreaction to the perceived China threat in the US "could turn into a McCarthyite Red Scare", referring to the "Second Red Scare" in the US in the 1940s and 1950s led by Republican senator from Wisconsin Joseph McCarthy who accused many of subversion and/or treason without proper regard for evidence. Dennis Wilder, an assistant professor of practice at Georgetown University who once held a senior position at the National Security Council and CIA on China and Asia, too, expressed deep concern at the level of "Red Scare" in Washington. In a talk at the Brookings Institution on April 22, Wilder sighed that his students studying in China on US scholarships are now in a dilemma. They can't get clearances when they want to join the US government after returning from China. Wilder has talked with top level FBI and CIA officials about this, and said he will keep talking about it. Since there is too much at stake, from the consequential China-US relations to global peace and development, we cannot afford to remain silent in the face of such growing "Red Scare" in Washington. Like Shirk and Wilder, more people should talk about stopping the "Red Scare" from spreading further. ^ top ^

Ex-Swedish envoy to China Anna Lindstedt suspected of crime after setting up 'unofficial' meetings over detained bookseller (HKFP)
2019-05-10
Sweden's former ambassador to Beijing could have committed a crime when she organised negotiations, unbeknownst to the foreign ministry, aimed at securing the release of detained Chinese-Swedish publisher Gui Minhai, a prosecutor said Thursday. Sweden's ambassador to Beijing from 2016 to early 2019, Anna Lindstedt is suspected of having overstepped her authority when she set up a meeting in Stockholm in late January between the publisher's daughter and businessmen claiming to have connections to the Chinese Communist Party, without informing the ministry. Gui Minhai, a Chinese-born Swedish citizen known for publishing gossipy titles about Chinese political leaders out of a Hong Kong book shop, disappeared while vacationing in Thailand in 2015 before resurfacing in mainland China. Prosecutor Hans Ihrman told Swedish public radio Sveriges Radio that Lindstedt was under formal investigation of a crime. Ihrman said she was suspected of "arbitrary conduct when negotiating with a foreign power," meaning someone acting outside their mandate. Contacted by AFP, Lindstedt's lawyer was unavailable for comment Thursday. The Swedish foreign ministry has said it knew nothing about the meeting nor that the ambassador was even in Stockholm at the time. Gui Minhai disappeared from a vacation home in Thailand in 2015. Several months later he appeared on Chinese state television confessing to a fatal drunk driving accident from more than a decade earlier. He served two years in prison, but three months after his October 2017 release he was again arrested while on a train to Beijing while travelling with Swedish diplomats. His supporters and family have claimed his detainment is part of political repression campaign orchestrated by Chinese authorities. Relations between Sweden and China have been strained for several years over the detention of Gui Minhai, 54. His daughter Angela Gui, who has been actively campaigning for her father's release, wrote in February on her blog that Lindstedt had invited her to Stockholm in January. During discussions in the lounges of a fancy hotel in the Swedish capital, in the presence of the ambassador, she was introduced to Chinese businessmen who claimed they could help negotiate her father's release. In exchange, Angela Gui said she was told to "stop all media engagement". The Chinese embassy in Stockholm said in a statement Beijing has "has never authorized and will not authorize anyone to engage with Gui Minhai's daughter". ^ top ^

China's Huawei reiterates confidence in CFO's innocence (Xinhua)
2019-05-09
Chinese technology giant Huawei said in a statement on Wednesday that the company has always been confident in the innocence of its chief financial officer (CFO) Meng Wanzhou, who was arrested in Vancouver last December at the extradition request of the United States. "We have maintained that her U.S.-ordered arrest was an unlawful abuse of process - one guided by political considerations and tactics, not by the rule of law," the statement said, after Meng attended a court hearing in Vancouver on Wednesday morning local time. The statement was made by Benjamin Howes, vice president of Canadian media affairs at Huawei, outside the British Columbia Supreme Court. "The criminal case against Ms. Meng is based on allegations that are simply not true. To the contrary, it was made clear in court today that business activities by Ms. Meng were conducted openly and transparently with full knowledge of banking officials," Howes said. The lawyers noted in court that there is no evidence to prove that Meng committed acts of deceit, dishonesty, or other fraudulent means, according to the statement. The actions against Meng led to serious and repeated violations of her rights, the statement said. Her luggage was searched, her cellphone and other electronic devices were seized, and she was compelled to reveal her passwords. It was revealed that the arrest of Meng violated a core principle of Canada-U.S. extradition treaty and Canada's extradition law, because the allegation she faces is not a crime in Canada, the statement said. "Political factors at play during the extradition process may lead to a serious violation of justice. Ms. Meng's legitimate rights may also be harmed. Thus Ms. Meng intends to apply to this Court for a stay of the extradition proceedings," Howes said. Canadians value the rule of law, and law-enforcement officials are expected to follow the rules at all times, in all cases and for all people - citizens and visitors alike, according to the statement. "We have trust in the Canadian judicial process - and we look forward to seeing Ms. Meng's freedom restored," Howes added. Meng was arrested on Dec. 1, 2018, at Vancouver's airport at the request of the United States, which is seeking her extradition on fraud charges. Both Meng and Huawei have repeatedly denied any wrongdoing. ^ top ^

Chinese court holds off ruling on Canadian's death penalty appeal amid diplomatic spat (HKFP)
2019-05-09
A Chinese court adjourned a hearing on a Canadian man's appeal against his death sentence for drug smuggling without a decision Thursday in a case that has deepened a diplomatic spat between Beijing and Ottawa. Robert Lloyd Schellenberg, 36, was sentenced to death in January after a court deemed his previous 15-year prison sentence too lenient. His appeal hearing came a day after a top executive of Chinese telecom giant Huawei, Meng Wanzhou, appeared in court in Canada to fight a US extradition bid that triggered the diplomatic storm. The Liaoning High People's Court in northeast China said in a statement that "all procedural rights of appellant Schellenberg were guaranteed in accordance with the law". The trial has adjourned and the court will "select a day or time to pronounce the sentence," it said without specifying. Schellenberg's case is seen as potential leverage for Meng, who was arrested on a US extradition request related to Iran sanctions violations — a link that Beijing has repeatedly denied. Following the Huawei executive's arrest in December, China detained former Canadian diplomat Michael Kovrig and businessman Michael Spavor, in what observers saw as retaliation. Canadian Prime Minister Justin Trudeau has said that China had "chosen to arbitrarily" sentence Schellenberg to death. His government has pleaded for clemency. Ottawa said Wednesday it was "extremely concerned that China has chosen to apply the death penalty, a cruel and inhumane punishment". Canadian officials were expected to attend Thursday's hearing. Schellenberg was originally sentenced to 15 years in prison and a 150,000 yuan (US$22,000) forfeiture in November. But following an appeal, the high court in Liaoning ruled in December that the sentence was too lenient given the severity of his crimes. About a month later, his sentence was changed to capital punishment. China has executed foreigners for drug-related crimes in the past, including a Japanese national in 2014, a Filipina in 2013, and a Briton in 2009. Last week another Canadian, Fan Wei, was sentenced to death for drug trafficking in a separate case in southern China. Kovrig and Spavor, meanwhile, have been denied access to lawyers and are allowed only monthly consular visits. Days after Canada launched the extradition process against Meng in March, China announced it suspected Kovrig of spying and stealing state secrets. It alleged fellow Canadian Spavor had provided him with intelligence. Meanwhile, Huawei's Meng was back in court in Vancouver on Wednesday, with her lawyers arguing that the US case was politically motivated. Her firm says she is innocent. Huawei is also in the US crosshairs as Washington seeks to convince Western nations to shun the telecom firm over security concerns. The diplomatic row appears to have has spilled over into the economic arena: China has banned Canadian canola and pork shipments worth billions of dollars. Ottawa has pressed Washington — which is locked in a trade dispute with China — to step up its pressure on behalf of the detained Canadians. ^ top ^

Xi to address Conference on Dialogue of Asian Civilizations (Xinhua)
2019-05-09
Chinese President Xi Jinping will deliver a keynote speech at the opening ceremony of the Conference on Dialogue of Asian Civilizations to be held on May 15 in Beijing, a senior official said Thursday. Xu Lin, deputy head of the Publicity Department of the Communist Party of China Central Committee and director of the State Council Information Office, made the announcement at a press conference. Representatives from 47 Asian countries and other countries outside the region will participate in the event, Xu said. Under the theme of "exchanges and mutual learning among Asian civilizations and a community with a shared future," the conference includes a welcome dinner, an opening ceremony, thematic forums, an Asian Culture Carnival and an Asian Civilization Week. ^ top ^

China urges maintenance, implementation of Iran nuclear deal (Xinhua)
2019-05-08
China on Wednesday called for maintenance and implementation of the Iran nuclear deal, urging relevant parties to exercise restraint and strengthen dialogue to avoid further escalation of tensions. Foreign Ministry spokesperson Geng Shuang made the remarks after Iranian President Hassan Rouhani announced on Wednesday the decision to suspend implementing some of its commitments under the deal, the Iran Joint Comprehensive Plan of Action (JCPOA), given the United States' previous unilateral withdrawal from it. Geng said China appreciates Iran's strict fulfillment of its obligations under the deal so far and firmly opposes unilateral sanctions and the so-called "long-arm jurisdiction imposed by the U.S. on Iran." The Chinese side regrets that the U.S. relevant moves have further aggravated tensions over the Iran nuclear issue, Geng said. "The deal should be fully and effectively implemented," Geng said, calling the multilateral agreement ratified by the United Nations Security Council "crucial to the international nuclear non-proliferation regime as well as peace and stability of the Middle East." It is the common responsibility of all relevant parties to maintain and implement the deal, the spokesperson said. "We call on relevant parties to exercise restraint and strengthen dialogue, to avoid escalating tensions." China will keep in contact with relevant parties and continue to make efforts for maintaining and implementing the deal, and at the same time firmly safeguard the legitimate rights and interests of Chinese enterprises, Geng added. ^ top ^

China to step up efforts to cut overcapacity in 2019 (Xinhua)
2019-05-10
Chinese authorities said Thursday the country will press ahead with the efforts to cut excess capacity in key areas, including coal and steel sectors, this year. In 2019, the government will focus on structural capacity cuts and promote the systematic improvement of production capacity, according to a circular jointly released by the National Development and Reform Commission and other departments. Since 2016, China has cut crude steel capacity by more than 150 million tonnes and cut outdated coal capacity by 810 million tonnes. The country should consolidate the outcomes of cutting overcapacity and step up inspection to avoid the resurgence of eliminated capacity, it said. Efforts should be intensified to optimize the structure of the steel industry and raise the quality of coal supply, the circular said. The country will strictly control new capacity and coordinate capacity-cut targets for 2019 to ensure market stability, it added. ^ top ^

County authorities probe chemical liquid leak scandal (Global Times)
2019-05-09
Local authorities in North China's Shanxi Province are investigating the aluminum manufacturer amid a chemical liquid leak scandal, and relocating residents nearby. The government of Jiaokou county, Shanxi Province announced on Thursday that they have arranged to help 35 families who had lived in the polluted area move out and have ordered the aluminum manufacture under the Xinfa Group to suspend production. The announcement came after the Beijing News reported on Wednesday that local villagers since 2017 have reported alkali liquor leaking from the cracks in the red mud dam, which is run by the company on the aluminum oxide project, severely polluting the environment and sparking concern over the possibility of the dam break. The Beijing News said on Tuesday that the company put up a factory, including gas stations, kilns, bauxite and limestone silos along the river eight kilometers away from the dam. The report said the red mud containing alumina waste is transported by the pipeline from the factory to the dam. The government said that it has asked a quality assessment department to evaluate the dam quality, investigate the causes of water seepage and the degree of the aluminum oxide liquefaction, monitor water and soil samples, and take preventive measures. Residents near the factory and the dam are worried about the pungent odor, Li Xiaogang, a local villager, told the Global Times on Thursday. "My two children got rashes and easily caught a cold. They were diagnosed with lead poisoning and started to receive medication last year," said Li. Li could not provide any hospital certificate. Liu Yuemin, another resident who lives in the lower reaches of the dam, told the Global Times that there were rashes on his head and his wife's face. They have had this symptom since 2017, and it is getting worse each year. Two local residents told the Global Times on Thursday that the authorities had promised to give them resettlement subsidies and other compensation during the authorities' investigation, but that they still had concerns over the pollution. Liu noted that the compensation the authorities promised was far from enough and they did not offer any place to settle down or arrange any medical examination. Challenged by the situation, the local government promised to launch a comprehensive campaign across the county to eliminate safety and environmental hazards to ensure the safety of people's lives and property, said the announcement. According to the open archive, the mud would cause serious water pollution and soil pollution, and the dust from the mud would pollute the air as well. Also, the red mud is corrosive and irritating which could cause burns to the human body. Alumina dust over the long term can cause lung diseases. In the early stages symptoms could be cough, burnout, and weakness, while in the later stages it could lead to emphysema, pulmonary infection, or tuberculosis, according to a statement provided to the Global Times by the Institute of Public and Environmental Affairs (IPE), a Beijing-based non-profit organization. However, the company denied with the Beijing News that the dam cracked and neither did the mud enter the river. The company has been at the forefront of the aluminum industry in recent years, and environmental issues always come with the production of alumina and electrolytic aluminum, the National Business Daily quoted an anonymous expert in the aluminum industry on Thursday. The company was ordered 15 times since 2012 by environmental authorities to improve on issues such as poor organized emissions of industrial dust and the poor disposal of volatile organic chemicals (VOCs), according to a list on the IPE website. ^ top ^

Former Communist Party boss of Yunnan Qin Guangrong investigated for corruption (SCMP)
2019-05-09
A former Communist Party boss of southwest China's Yunnan province is being investigated for suspected corruption, according to an official notice published on Thursday. Qin Guangrong, who held the position from 2011 to 2014, turned himself in to the authorities, the Central Commission for Discipline Inspection and the National Supervisory Commission said in a joint statement. The statement did not say when Qin handed himself in but said he was being investigated for "serious violations of party discipline and laws", the usual euphemism for corruption. The 68-year-old is one of the most senior officials to have turned himself in since China's top leadership launched a nationwide crackdown more than six years ago. Following a spate of arrests during his first term as president, Xi Jinping said in December that the party had achieved a "crushing victory" in its war on corruption. Over the past two years there has been a growing trend for cadres turning themselves in. The National Supervisory Commission, which is the country's top anti-corruption body, said in its annual report in February that more than 5,000 cadres, many of whom held provincial and ministerial level positions, had done so since late 2017. Among them was Ai Wenli, a former vice-chairman of the Hebei committee of the Chinese People's Political Consultative Conference, a provincial level advisory body. He surrendered himself to the authorities last year and after being found guilty of accepting more than 60 million yuan (US$8.8 million) in bribes was sentenced to eight years in prison. Under China's National Supervision Law, which was enacted just last year, prosecutors can recommend leniency for suspects who surrender themselves. Qin was promoted to Yunnan party chief four years after taking over as provincial governor in 2007. Before then he had been in charge of home security in the border province, after spending well over a decade in central China's Hunan, including just over two years – from December 1984 to February 1987 – as head of the provincial Communist Youth League. Despite his rise, he was abruptly removed from his post in late 2014 and made a deputy committee chief of the National People's Congress – a position he held until March last year. Qin's predecessor and former boss in Yunnan, Bai Enpei, was found guilty of corruption and given a suspended death sentence in October 2016. The same year, Qiu He, one of Qin's deputies, was sentenced to 14½ years in prison for accepting bribes of more than 24 million yuan. ^ top ^

China to extend tax preferences for IC, software companies (Xinhua)
2019-05-08
The State Council, China's cabinet, on Wednesday decided to continue the preferential corporate income tax policies for integrated circuit (IC) and software companies. The country will also attract more investment from home and abroad to participate in and promote the development of the two sectors, according to a statement made public after a State Council executive meeting presided over by Premier Li Keqiang. China will continue to implement the tax cut and exemption policies for both sectors starting from the tax calculation and collection for 2018. Meanwhile, authorities should focus on improving the supporting policies to further promote the development of IC and software industries to a higher level, the statement said. ^ top ^

Summit demonstrates China's leapfrog into digital world (Xinhua)
2019-05-06
China on Monday sounded another heartening note for its development of information technologies, as both companies and the government rush to harness the nationwide tech boom to raise efficiency, buoy public satisfaction and even tackle corruption. The second Digital China Summit opened Monday in eastern China's Fujian Province, shedding light on the latest information technologies that have penetrated the country's government, industries and society. The Chinese government has expected information technologies to nurture new economic engines and upgrade old industries as the country shunts from the high-speed economic growth to the path of high-quality development. Huang Kunming, a member of the Political Bureau of the Communist Party of China (CPC) Central Committee, in a keynote speech at the summit called for advancing the building of a digital China and smart society, stressing the role of information technology in promoting high-quality development. Huang, also head of the Publicity Department of the CPC Central Committee, said China's advantages in internet technology innovation, technology application and as a huge market should be transformed into advantages in developing a digital economy. The official called for achieving breakthroughs in core technologies, enhancing protection of intellectual property rights, advancing information infrastructure construction and narrowing digital gaps between urban and rural areas. A report reviewing the country's digital development in 2018 was also issued at the summit, pointing to rapid growth in sectors including electronic information manufacturing, software service, communications and big data. The report published by the Cyberspace Administration of China said the country last year recorded more than 9 trillion yuan (1.3 trillion U.S. dollars) in online retail. China's digital economy reached 31.3 trillion yuan in scale, accounting for one-third of the national GDP in 2018. Provincial-level e-government platforms have also slashed time for getting government permits by an average of 30 percent, noted the report. Trendy technologies from driverless vendor vehicles and facial recognition security checks to 5G networks are being used at the event in the city of Fuzhou. A number of tech companies are displaying their cutting-edge products including Baidu's driverless vehicles, Huawei's AI chip "Ascend" and Foxconn's "future factories." Pony Ma, CEO of China's Internet giant Tencent, said at the summit that the company, by working with Fujian police, has used its facial recognition technology to help 1,000 families find missing family members in the past two years. Hu Xiaoming, president of Ant Financial that runs the popular online payment network Alipay, said at the event that one of every four Chinese now handles government services on Alipay, making it the country's largest platform that offers access to government services. One of the major highlights at the summit's exhibition area are the many e-government apps, which have mushroomed across China to incorporate a wide range of government and public services. They are part of the government's efforts to cut red tape to benefit residents and businesses alike. In Fuzhou, the host city of the event, a citizen's typical day now revolves around the e-Fuzhou app, which allows users to buy bus tickets, pay tuition fees and manage social security accounts without the need of visiting government offices. A slew of digital technology applications, including the big data credit inquiry system, the online tax bureau, and the paperless customs clearance system, have also been developed in the province over the years. Dingxi, one of the least developed cities in west China's Gansu Province, has a booth displaying an online monitoring platform, which it launched last year to allow villagers to scrutinize the management of poverty-relief funds and report any signs of corruption. "We went door-to-door to teach villagers how to use mobile phones to check the subsidies they are entitled to and the sum other families actually received," said Yang Sirun, an inspector with the city's discipline inspection commission. "In the past, some wealthy families feigned poverty to claim subsistence allowances, while some officials fraudulently pocketed subsidies in the names of families that had moved away. The new platform can easily expose such 'micro corruption,'" Yang said. The official said since its launch, over 3,400 officials and residents have voluntarily turned in their illegal gains for fear of being reported. "Many hidden problems were also found during the collation of data from different departments, which proves big data's power in fighting corruption," he said. The summit from May 6 to 8 aims to serve as a platform for issuing China's policies on IT development and displaying the achievements and experience of e-government and the digital economy. More than 1,500 officials, company representatives and scholars are attending the event, which is co-organized by the Cyberspace Administration of China, National Development and Reform Commission, Ministry of Industry and Information Technology and Fujian provincial government. ^ top ^

Chinese AR start-up develops smart glasses to help police catch suspects (SCMP)
2019-05-06
Using a pair of glasses to detect and locate criminals might sound like a futuristic scene from a Hollywood film, but it has already become a reality in China. Beijing-based augmented reality (AR) company Xloong created such a set of smart glasses for Chinese police in 2017, according to a company brochure. When wearing the AR glasses, police can access real-time facial, identification card and vehicle plate information that are linked with a national database. The company said the AR glasses "free the hands" of police and "improve efficiency in discovering criminal suspects". The glasses are already being used by law-enforcement authorities at airports and highway inspection stations, the company said in the handout. Six local public security bureaus are also using the Xloong headsets, including those in Beijing, Tianjin and the Xinjiang Uygur autonomous region. Xloong, meaning "fierce dragon" in Chinese, was founded in Beijing by former Huawei Technologies hardware engineer Shi Xiaogang. The start-up currently employs more than 100 people and counts internet of things firm Hefei BOE Technology, Gobi Ventures, Beijing Institute of Technology, and some provincial governments as financial backers, having raised hundreds of millions of yuan from them. An Xloong spokesman declined to provide the exact amount of venture capital the company has raised and would not identify which local governments have supported the start-up financially. The four-year-old company has also developed a smart helmet for use by the Chinese military. Besides offering head protection, the helmet's hi-tech functions include AR monitoring, telecommunications, night vision and geolocation. Xloong said it has signed a contract worth "tens of millions of yuan" to supply helmets to state-owned defence company China North Industries Group. Xloong said it has other state-level clients including China Aerospace Science and Industry Corporation and the Ministry of Public Security. China spent US$184 billion on domestic security in 2017, less than the US$150 billion it spent on external defence, according to China's Ministry of Finance. The country had 176 million surveillance cameras operating in public and private areas in 2017, according to market research firm IHS Markit. That compares to 50 million cameras in the US in the same time frame. In an interview with Nikkei Asian Review last year, Xloong founder and chief executive Shi shrugged off concerns that surveillance technology would inevitably lead to privacy intrusion. He said national support for hi-tech companies, as well as the central government's emphasis on anti-terrorism and social stability, were "important drivers for the company to thrive". "There is no shortage of budget from the [authorities]," Shi added. Besides crime-fighting and defence applications, the company makes headsets for civilian uses in industries including tourism, real estate and health care, as well as selling directly to consumers. In 2016, Xloong released a sports version of the AR glasses that supports videography and Bluetooth, and can project digital maps for runners and cyclists. The headsets are sold on e-commerce platforms such as Alibaba Group Holding's Tmall and JD.com, as well as in offline retail chains like Suning. New York-listed Alibaba is the parent company of the South China Morning Post. The sports headsets are priced around 1,500 yuan (US$223), while AR glasses for industrial use cost around 15,000 yuan. A spokesman for Xloong said the company has already signed contracts with some partners in Southeast Asia. He declined to reveal the names of these partners or identify ongoing projects. The spokesman added that Xloong has plans for US expansion, but declined to elaborate. Chinese facial recognition companies, including Megvii and Yitu Technology, have been venturing overseas in search for new growth. The auxiliary force of the Malaysian police, for example, has been equipping officers with body mounted cameras that use Yitu's facial recognition system, enabling near real-time comparison and matching with images stored in the police database. ^ top ^

China announces guidelines to promote integrated urban-rural development (Xinhua)
2019-05-06
The Central Committee of the Communist Party of China (CPC) and the State Council, or China's Cabinet, on Sunday announced guidelines on the promotion of integrated urban-rural development. China has made great headway in advancing urbanization and balancing development between rural and urban areas since the 18th National Congress of the CPC. However, barriers hindering integrated urban-rural development still exist. The guidelines are aimed at eradicating such barriers to promote rural revitalization and speeding up the modernization of agriculture and rural areas. The systems and mechanisms for promoting integrated urban-rural development should begin to take shape by 2022. The country will also gradually eliminate restrictions on urban settlement, according to the guidelines. China aims to put in place more sound systems and mechanisms for promoting integrated urban-rural development by 2035. The urban-rural gap in development and living standards will be remarkably reduced. By the middle of the century, China will meet the goal of realizing the comprehensive integration of urban-rural areas and rural revitalization and basically realize the target of achieving shared prosperity for everyone. To achieve these ambitious goals, China will break barriers that restrict the free flow of resources -- such as capital, talents, information -- between urban and rural areas, and inject new impetus to the countryside. China will deepen household registration reforms, relax restrictions on urban settlement except for several mega-cities, promote coordinated development between cities and towns, as well as increase the population carrying capacity and attractiveness of mid- and small-sized cities. The country will also make cities more inclusive and help migrant workers settle into city life. China will implement incentive policies to attract talents to work or start businesses in rural areas. The country will continue to deepen and improve rural land reform and allow farmers to turn their land-use rights into shares in farming enterprises or cooperatives. China will also improve financial services in rural areas, and support the issuance of government bonds by local authorities to finance public welfare projects on integrated urban-rural development. Considering that public services are weak in rural areas, China will establish and improve its systems and mechanisms to channel more resources there. China will establish a mechanism to balance the allocation of educational resources and prioritize developing education in rural areas. Provincial-level governments are encouraged to build a supplementary mechanism for unified selection of rural teachers and send more outstanding college graduates to rural schools. The country will improve the medical and health service system in rural areas, efforts will be made to increase the attractiveness of grassroots medical jobs and training of rural medical workers will be strengthened. China will also improve the public cultural service system and channel more cultural resources to rural areas. Cultural workers and volunteers are encouraged to participate in the cultural development in rural areas. The guidelines also call for improving the unified urban and rural social security system, coordinating urban and rural social assistance systems and establishing rural governance mechanisms. Institution and mechanism will be established to promote the integrated development of urban and rural infrastructure, with priority given to rural areas. To promote diversified economic development in rural area, the country will continue to protect its agriculture, establish a cultivation mechanism for new industries and build a platform for integrated development of urban and rural industries. The country will also expand the channels to raise farmers' income and constantly narrow the gap in the living standard of urban and rural residents. Employment discrimination will be eliminated, more jobs created and business opportunities increased to form an environment for promoting income increase for farmers, according to the guidelines. ^ top ^

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China slams US for trying to deprive Beijing of UN forum seat over Uygur detentions in Xinjiang (SCMP)
2019-05-08
China angrily assailed the United States on Tuesday for calling on countries at the United Nations to deprive Beijing of a seat at a UN forum over its treatment of the Uygur minority. It was the second time in as many weeks that the two countries openly clashed at the United Nations over the rights of the Uygurs and other mostly Muslim minorities held in camps in China's Xinjiang region. Last week, the US invited the head of the World Uygur Congress, Dolkun Isa, to address the UN forum on indigenous peoples, infuriating China. US diplomat Courtney Nemroff said ahead of elections on Tuesday that China's treatment of Uygurs should be a factor in deciding on membership to the UN forum tasked with protecting indigenous people worldwide. "The United States is alarmed that more than a million Uygurs, ethnic Kazakhs, Kyrgyz, and other Muslims have suffered arbitrary detention, forced labour, torture, and death in camps in China's Xinjiang" region, said Nemroff. "These atrocities must be stopped. We call on member states to bear this in mind in this important forum." A Chinese diplomat took the floor to strongly reject the US statement. "The US representative made an unreasonable accusation against China and defamation against China," he said, expressing Beijing's "strong displeasure over this and our firm opposition to it". Despite the US appeal, China's candidate, Zhang Xiaoan, was elected by acclamation to the 16-member UN forum along with four other representatives from Burundi, Namibia, Denmark and Russia. Beijing claims the camps in Xinjiang are "vocational training centres" to steer people away from extremism and reintegrate them, in a region plagued by violence blamed on Uygur separatists or Islamists. In his address at the UN, Isa said Uygurs were being rounded up to live in "an open-air prison," deprived of their religious rights and freedom. The Chinese diplomat told the meeting that Isa was a "terrorist designated by the Chinese government" and supported by the US, which "is utilising him to attack China and defame China, with no basis at all". The US was among a group of countries that asked UN Secretary-General Antonio Guterres to raise the plight of the Uygurs during his visit to China last month. Guterres told Chinese Foreign Minister Wang Yi that "human rights must be fully respected in the against terrorism", according to UN spokesman Stephane Dujarric. ^ top ^

Administrative wing of Hong Kong's legislature accused of filtering employees by political stance (HKFP)
2019-05-10
The secretariat of Hong Kong's legislature faced fresh accusations of political bias on Thursday, after a security guard said she was asked to declare her political stance during her employment in a questionnaire. A woman, surnamed Wong, said she faced "constant bullying" from her supervisors after refusing to fill out a form in October 2017 that asked if she was "yellow" or "blue" – referring to colours symbolising the pro-democracy and pro-Beijing camps. Over the year that followed, Wong received unreasonable complaints and her work evaluations turned negative, she said. Wong was employed as a security guard in August 2016 with a three-year contract. However, she said he had to seek medical attention to deal with stress, and will leave her job at the end of this month. The woman spoke at a press conference on Thursday, wearing a disguise and accompanied by Civic Party lawmaker Jeremy Tam. Tam said he had written to the Legislative Council Commission demanding an explanation, adding that the incident showed that the legislature's administrators were not as neutral as they claimed. An independent commission of enquiry would be needed for the incident, Tam added, otherwise he would not rule out an investigation under the Legislative Council (Powers and Privileges) Ordinance. When asked whether there was evidence to support Wong's claims, Tam said that he had proof but would rather reveal it during the investigation stage. Shortly after four pro-democracy lawmakers were ousted from the legislature in 2017, Wong recalled that she and other members of her security team were asked to declare their political affiliations. The form included her name and the names of her colleagues, and there was no option to pick "neutral," she said. Wong also recalled instances where her bosses warned against interacting with "people [she] should not talk to." Once, she was spotted talking to pro-democracy activist Raphael Wong, who was then working as a political assistant. Another time she tried to guide a well-known elderly protester – affectionately known as "grandma Wong" – out of the road and back onto the curb, but later was reprimanded for leaving her post. On Thursday evening, the legislature's president Andrew Leung said that the allegations were very serious, and will be discussed when the Legislative Council Commission meets on May 20. "We will deal with this as seriously as possible," he said. Kenneth Chen, the legislature's secretary-general who heads the secretariat, refused to give a straight answer over whether the "blue or yellow" forms existed. Chen said he had just received the documents submitted by Tam and needed more time to study them. However, he maintained that he had never asked his employees to declare their political stances. "Political neutrality is a core value and operating principle of the secretariat," Chen said, adding that the secretariat takes all complaints seriously and will cooperate with the Commission. Asked if Chen should step down, Leung said that "there were only allegations but no proof," and that the incident did not reach a level that required Chen to be suspended. The secretariat had been under fire for intervening in the legislative process of the Hong Kong government's extradition plan, with democrats accusing it of abusing its power to side with the pro-Beijing camp. In that case, Chen also denied any wrongdoing on the part of the secretariat. ^ top ^

'More Hongkongers will go into exile' – Alleged recording from localist who fled to Taiwan prompts search (HKFP)
2019-05-08
A Hong Kong localist on the run in Taiwan has allegedly resurfaced to speak on an online talk show, drawing the attention of local authorities. Activist Lee Sin-yi fled to Taiwan in January 2017, ahead of a court date related to her participation in the Mong Kok unrest the year before. She has not been heard from since August 2017, when she released a recording explaining why she chose exile. On Tuesday evening, a new recording allegedly from Lee was broadcast on a YouTube show hosted by Chen Yi-chi, the chairperson of the pro-independence Taiwan Statebuilding Party. "I chose to speak up now to remind my friends in Hong Kong that – with Lam Wing-kee's exile – we can expect more people to go into exile in the future," Lee said, referring to the decision last month by the bookseller to leave Hong Kong for Taiwan. Lee said that her fears about Hong Kong have come true over the past two years, with the city's rule of law being threatened by China. She said that the latest extradition plan proposed by the Hong Kong government would offer a "facade of legitimacy" for China to crack down on dissidents. "The people of Hong Kong and Taiwan cannot afford to continue to be naive, we must be more aware of the crisis posed by China's regime," she added. In the recording, Lee also called on the people of Taiwan to be wary of China's influence, and that it may follow the path of Hong Kong if pro-Beijing politicians triumph in the island-wide elections next year. Taiwan's National Immigration Agency confirmed to news outlet Central News Agency that Lee's visa had expired. Lee entered the island on January 6, 2017 and was permitted to stay for 30 days, but there is no record of her leaving, authorities said. Lee's current whereabouts are unknown and the immigration body has stepped up its efforts to locate her, CNA reported. Programme host Chen also said he did not know where Lee was, and that he received the recording via a mailed USB memory stick, which also came with a printed transcript including Lee's signature. The immigration authority added that there was no record of Lee asking for political asylum in Taiwan – though such a request could not be entertained in any case, since the island does not have a law on asylum. Any Hong Kong resident who overstays in Taiwan may be fined up to HK$2,500 and be banned from returning for up to three years. Bookseller Lam Wing-kee, who Lee referred to in her recording, also appeared on the hour-long YouTube program on Tuesday. Lam was the founder of Causeway Bay Books, and went missing from Shenzhen in October 2015, only to re-emerge on a Chinese television channel months later "confessing" to crimes. "I hope that she can live a normal life, even if she has to leave Taiwan," said Lam, who broke down in tears after Lee's recording was played. "I am also the father of two children, if one of my children were in her situation, I'd be devastated." Lam had previously been criticised for urging Lee to return to Hong Kong to face trial. Lam admitted last month that he was wrong at the time, and that recent events have shown that Hong Kong courts would not treat activists fairly. ^ top ^

U.S. move on Taiwan question puts China-U.S. ties in jeopardy (Xinhua)
2019-05-09
Washington's recent move on the Taiwan question has muscled in on China's sovereignty and internal affairs, and put the bilateral relations in jeopardy. The U.S. House of Representatives on Tuesday passed the "Taiwan Assurance Act of 2019" and "Reaffirming the United States commitment to Taiwan and to the implementation of the Taiwan Relations Act," a blunt violation of the one-China principle and the spirit of the three China-U.S. joint communiques. According to the China-U.S. joint statement released in November 2009, the two sides reiterated that the fundamental principle of respect for each other's sovereignty and territorial integrity is at the core of the three China-U.S. joint communiques which guide China-U.S. relations. Neither side supports any attempts by any force to undermine this principle. The latest move by the U.S. Congress has betrayed the basic principles and obligations encoded in international law. For a country to be a responsible one in the international arena, it needs to keep its word. "I don't know how men get along without good faith," Chinese philosopher Confucius once remarked. The Taiwan question has all along been the most consequential and sensitive one with regard to the China-U.S. relations, and the one-China principle constitutes the political basis for the bilateral relations. If the United States gets on with its reckless acts on Taiwan-related issues, it is going to hurt the two sides' strategic mutual trust, and bring irreparable damage to bilateral ties. The Taiwan question also concerns China's core interests, its sovereignty and security, and the national bond of all Chinese people. Facing external interference in it, the Chinese government and Chinese people will never sit by and let it loose. Currently, certain factions in the United States miscalculate where the two countries would go next and make a string of irresponsible remarks as well as deeds. China and the United States stand to gain from cooperation and lose from confrontation. The United States needs to stick to the one-China principle and the three China-U.S. joint communiques, and safeguard bilateral ties with coordination, cooperation and stability as the defining features. By taking advantage of Taiwan-related issues as a bargaining chip, the United States is trying to contain China for self-serving purposes. Yet that is a wrong path. If the U.S. side stays on this wrong direction, China will take forceful responses. ^ top ^

Beijing blasts US Congress for Taiwan defense bill (China Daily)
2019-05-09
Beijing resolutely opposes the United States House of Representatives for passing a bill on Tuesday to bolster Taiwan's defense capability, calling it "boorish interference" in China's domestic affairs. Foreign Ministry spokesman Geng Shuang made the comment on Wednesday after the House voted to pass a nonbinding resolution reaffirming the US commitment to Taiwan. It also backed the so­-called Taiwan Assurance Act of 2019, which supports Taiwan increasing its defense spending. The legislation states that Washington should conduct "regular sales" of "defense articles" to Taiwan and back its participation in international organizations. "We urge the US side to keep its promise, abide by the one-­China policy and the three joint communiques, and block the bill's progress," Geng said. He urged the US to "appropriately handle the Taiwan question to avoid serious damage to Sino-US cooperation in key areas, and the peace and security of the region". Experts said the bill will further damage Sino-US relations, and the confrontational approach taken by the US against China will damage regional peace and security. Yuan Zheng, director of US foreign relations research at the Institute of American Studies under the Chinese Academy of Social Sciences, said the recent passage of US naval vessels through the Taiwan Straits, arms sales and political support to Taiwan are meant to help Taiwan separatists and pressure Beijing. "China has exercised great restraint and goodwill in trying to maintain stable relations with the US," he said. Li Haidong, a professor of US studies at China Foreign Affairs University, said Washington has pushed a hard line in relations with Beijing in recent years. "The Taiwan question is much more complicated and nonnegotiable," Li said. "If the US side continues to misinterpret the one-­China policy, it will irreparably damage Sino­-US ties," he warned. The US Senate will have to vote on the act before it can become law. The time of the vote is unknown. "The consensus among US officials is to be tough on China, and room for rational options is rapidly shrinking as overconfidence and rash actions become the new norm," he said. ^ top ^

JPMorgan poised to be first foreign company to own majority stake in China mutual fund venture (SCMP)
2019-05-09
JPMorgan could become the first foreign company to own a majority stake in its Chinese mutual fund business, after its joint venture partner put a crucial 2 per cent of the business up for sale that analysts expect the Wall Street bank to lap up. A move by JPMorgan towards that goal would come at a tense time in US-China ties, as Chinese Vice-Premier Liu He is set to continue trade negotiations with the United States that were roiled after US President Donald Trump said on Sunday he would raise tariffs. Under new rules announced in late 2017, foreign asset managers can own up to 51 per cent of their Chinese mutual fund joint ventures, though, so far, no company has managed to do so. JP Morgan Asset Management (JPMAM) currently owns 49 per cent of China International Fund Management (CIFM), while Shanghai International Trust, belonging to Shanghai Pudong Development Group, owns 51 per cent. Shanghai International Trust said in a posting on the Shanghai United Assets and Equity Exchange website it is auctioning a 2 per cent stake. "This is a very, very critical step because this potentially could open the doorway for a number of other deals to begin working their way through the process," said Peter Alexander, founder and managing director of fund consultancy Z-Ben Advisors. Alexander added he had "a high conviction level" that JPMorgan will be the buyer and that the purchase price will be watched closely, as it will offer a guidance on the "premium" foreign firms need to pay for control of a Chinese fund venture. The open bidding process began on Wednesday, and will continue until June 4. Last year, JPMorgan said that its asset management unit was "pursuing its desire and intent to increase its current joint venture stake in China International Fund Management Co Ltd to a majority interest". A spokeswoman for JPMAM declined to comment on Shanghai International Trust's move. Were JPMAM to win the auction, it would still need approval from Chinese regulators to reach 51 per cent. Morgan Stanley became the largest shareholder last month in its joint venture, but remains short of majority control. A number of foreign asset managers, including JPMAM, wholly own companies in China which hold private securities fund management licences. However, these licences do not allow them to sell products to mass market retail investors, something that is allowed for mutual fund management joint ventures. Lack of access to the China market for foreign companies, including financial services firms, is one major area of contention in the trade dispute between China and the US, and Z-Ben Advisors' Alexander said that the stake auction by JPMorgan's Chinese fund partner could be seen in the context of the trade talks. "You know this could have been done ages ago. Why now? I don't believe in coincidence," he said. ^ top ^

Broader access to attract more global investors (China Daily)
2019-05-09
Foreign financial investors are poised for a greater role in China's capital markets as domestic financial regulators accelerate the integration of domestic markets into the global financial system and speed up financial opening-up. MSCI Inc, a provider of global stock benchmark indexes, said on Tuesday that it will announce the results of its 2019 semiannual index review by Monday, which is set to increase the index inclusion factor of all China large-cap A shares in the MSCI Indexes from 5 percent to 10 percent and add large-cap ChiNext shares with a 10 percent inclusion factor. That means global investors could include a broader range of Chinese equities in their portfolios related to the MSCI index, said analysts. Capital inflows, mostly in the form of foreign investment in domestic bond and equity markets recently, will continually increase, along with the reduced limitations imposed on cross-border financial activities, they said. China said on Monday that it had approved $4.74 billion of additional quotas for 13 qualified foreign institutional investors in the first four months of this year, which already exceeds the total quota approved in 2018. Among that, a total of $4.2 billion in quotas were approved for nine institutions under the QFII scheme in April, said the State Administration of Foreign Exchange, the country's foreign exchange regulator. European financial giants Deutsche Bank from Germany and Society Generale from France had increased their quotas to $1 billion and $2.7 billion respectively by late April, to expand investment in Chinese onshore capital markets, according to the administration. Two experts close to the administration said that China may further ease its thresholds for overseas institutions participating in bond repurchases and foreign exchange derivative trading. "China's determination to expand opening-up and the ongoing reform measures have made its financial market increasingly appealing to overseas investors," the administration said on Monday in a statement on its website. "The administration will continue to support the opening-up of financial markets, meet demand from overseas investors to expand investment in the markets and attract global long-term capital to enter China's financial markets," it said. Given the stable performance of the yuan and expectations of balanced capital flows, China's foreign exchange reserves remained stable in April, reaching $3.095 trillion by the end of last month, compared with $3.099 trillion by March, according to data released by the administration on Tuesday. China is willing to see the accelerated development of the onshore capital market, said analysts, allowing direct financing to play a more significant role in allocating savings and investment, and better serve the economy. Financial sector restructuring is also a part of the ongoing supply-side structural reform, as it is still dominated by the 268-trillion-yuan banking system, the analysts said. The restructuring process will accelerate as more foreign capital moves in, which can boost competition in the domestic market, the analysts added. In the medium term, continued financial reform and more opening-up measures could boost capital inflows, said Lillian Li, a vice-president at rating agency Moody's. But trade disputes between China and the United States and uncertainty over monetary policy in global markets may dampen capital inflows, and the pace of capital inflow is likely to fluctuate in the near term, she said. Having the world's second-largest equity market and the third-largest bond market, China will likely usher in more international capital flows in the longer term, if the nation further liberalizes its financial system, she added. "Reflecting China's increasing global footprint, the next decade is likely to be driven by greater global financial sector integration," said Alfred Schipke, the International Monetary Fund's senior resident representative for China. ^ top ^

US seizes North Korean coal ship 'Wise Honest', accuses Pyongyang of violating sanctions (SCMP)
2019-05-10
US authorities have seized a North Korean ship used to sell coal in alleged violation of international sanctions, Justice Department officials said on Thursday. They confirmed the ship, the "Wise Honest", is approaching US territorial waters, with coordination of the US Marshals and the coastguard. Officials said it was the first time the US has seized a North Korean cargo vessel for violating international sanctions. "This sanctions-busting ship is now out of service," US Assistant Attorney General John Demers said in announcing the seizure. The 17,601-tonne, single hull bulk carrier ship is one of North Korea's largest carriers, and US authorities said it was used to illicitly ship coal and deliver heavy machinery to North Korea. Media reports from last year indicate Indonesian authorities first stopped the vessel on suspicion of violating sanctions. US officials would not say on Thursday if Indonesia turned over the vessel. The UN Security Council passed a resolution in 2017 banning North Korea from exporting coal. The move marks an escalation of US government pressure on Pyongyang, even as President Donald Trump has spoken glowingly about North Korean leader Kim Jong-un. Last month, a federal judge in the District of Columbia approved a set of subpoenas targeting the financial records of Chinese banks which might show how the North Korean regime has sought to evade sanctions over its nuclear programme. In that case, investigators are probing whether a Hong Kong corporation may have helped North Korea evade sanctions. ^ top ^

North Korea fires off more missiles as it ridicules Seoul's objections (SCMP)
2019-05-09
North Korea welcomed a US envoy's visit to Seoul by firing two missiles on Thursday, the South's military said, in Pyongyang's second launch in less than a week as it seeks to up the ante in stalled nuclear negotiations with Washington. The launch came just days after the North carried out a military drill and fired multiple projectiles on Saturday, with at least one believed to be a short-range missile. The North had not previously fired a missile since November 2017, shortly before a rapid diplomatic thaw eased high tensions on the peninsula and paved the way for a historic first meeting between its leader Kim Jong-un and US President Donald Trump. But their second summit in Vietnam in February broke up without an agreement rolling back Pyongyang's nuclear programme in exchange for sanctions relief or even a joint statement, leaving the North frustrated by the stalemate. Thursday's launch came hours after the US Special Representative on North Korea, Stephen Biegun, arrived in Seoul late on Wednesday for talks with South Korean officials on the allies' approach towards Pyongyang, in his first visit since the Hanoi summit. The North "fired what appeared to be two short-range missiles", Seoul's Joint Chiefs of Staff said in a statement, adding that they flew eastward for 270 and 420 kilometres and the South Korean and US militaries were jointly analysing them. Earlier on Thursday, Pyongyang described its firing of rocket artillery and an apparent short-range ballistic missile over the weekend as a regular and defensive military exercise and ridiculed South Korea for criticising the launches. The North's official Korean Central News Agency published a statement by an unnamed military spokesman who called South Korea's criticism a "cock-and-bull story". A separate statement by a North Korean foreign ministry spokesman described the launches as a "routine and self-defensive military drill". South Korea's presidential Blue House and Defence Ministry have raised concerns that the launches went against the spirit of an inter-Korean military agreement reached last year to cease all hostile activities and urged North Korea to refrain from acts that could escalate tensions. North Korean state media on Sunday showed leader Kim Jong-un observing live-fire drills of long-range multiple rocket launchers and what appeared to be a new short-range ballistic missile fired from a launch vehicle. Saturday's launches, which likely represented North Korea's first ballistic missile launch in more than 500 days, highlighted the fragility of the detente between the Koreas, which in a military agreement reached last September vowed to completely cease "all hostile acts" against each other on land, in the air and at sea. The North Korean statements implied that Saturday's weapons launches counter joint military drills conducted by the US and South Korea in March and April. The North also criticised the test of a US Minuteman intercontinental ballistic missile from a US Air Force base in California last week. While the US and South Korea have stopped their annual large-scale military exercises and replaced them with smaller exercises since last year to create room for diplomacy, the North has still criticised the South for continuing joint drills with the US. The statement by the North Korean military spokesman said the South's military has "no qualification" to vilify the North when they "staged a provocative combined air drill against the sovereign state together with the US" and kept silence about the Minuteman test that it said was meant to threaten the North. ^ top ^

Murun soum to cooperate with Dandong city of China (Montsame)
2019-05-09
Governor of Murun soum Ts.Gansukh and Mayor of Dandong city of China signed a memorandum of cooperation on tourism, agriculture, education, urban development and planning on May 8. With the memorandum, the two sides will be cooperating through the course of the next three years. While Murun soum had previously established partnerships with the city of Baruth in Germany as well as the Republic of Buryatia in Russia in the sectors of tourism, education and health, the soum will now be cooperating with a port city of China. ^ top ^

Industrial production increases by 17.5 percent (Montsame)
2019-05-08
As of the first quarter of this year, a total production of industrial sector reached MNT 3.8 trillion, showing an increase of 17.5 percent comparing to the same period of last year. This increase was mainly caused by 21.3 percent growth in total production of mining and extractive industry compared to the same period of previous year. Moreover, coal mining and metal ore mining upped by 64.9 percent and 1.4 percent respectively. Extraction of fluoride, petroleum, molybdenum concentrate and gold are decreased by 4.2-30.1 percent. In the processing sector, production of main types of products including beer, vacuum windows, doors, buuz and dumpling, woolen and textile goods, combed cashmere and wooden doors and windows for building are increased by 2-97.1 percent. ^ top ^

Jennia JIN
Embassy of Switzerland