Switzerland

• Swiss investment bank UBS apologises for chief economist's 'Chinese pig' remarks, which sparked outcry online (SCMP)

Foreign Policy

• Pacts, statement shore up Kyrgyz ties (China Daily)
• China appears set to snub Canadian PM Justin Trudeau until Huawei's Meng Wanzhou is released, following his plea for Michael Spavor and Michael Hovrig (SCMP)
• SCO Bishkek summit to promote SCO community with a shared future (People's Daily)
• 'Chinese' cyber spy ring accused of targeting key players in Belt and Road Initiative (SCMP)
• China will fight to end if U.S. keeps escalating trade frictions: MOC (Xinhua)
• Chinese HIV carriers eye cheaper drugs in Thailand, India (Global Times)
• Why Trump's clampdown on academia is forcing many Chinese researchers into a difficult corner (SCMP)

Domestic Policy

• Chinese premier underlines mass entrepreneurship, innovation (Xinhua)
• China restricts developed regions from 'mining' talent from central, western areas (Global Times)
• China cybersecurity rule on exporting of personal information seen raising compliance costs for firms (SCMP)
• Nation hottest global investment destination (Global Times)
• China encourages businesses to diversify foreign trade markets (Xinhua)
• China to boost social credit system with new market regulatory measures (Xinhua)

Guangdong

Swiss investment bank UBS apologises for chief economist's 'Chinese pig' remarks, which sparked outcry online (SCMP)
2019-06-13
A chief economist at UBS Global Wealth Management and the bank have apologised after making reference to a "Chinese pig", which sparked online criticism. The Swiss investment bank issued an apology for any misunderstanding caused by Paul Donovan's comments on China's inflation, where were made in a podcast on Wednesday. Donovan had attributed higher Chinese consumer prices to "sick pigs". He dismissed the global importance of the price inflation, saying "does this matter? It matters if you are a Chinese pig. It matters if you like eating pork in China. It does not really matter to the rest of the world". The bank subsequently removed the statements from circulation. "We apologise unreservedly for any misunderstanding caused by these innocently intended comments by Paul Donovan," Hong Kong-based spokesman for UBS Mark Panday said. "We have removed the audio comment from circulation. To be clear, this comment was about inflation and Chinese consumer prices rising, which was driven by higher prices for pork." On Thursday afternoon, Donovan issued a formal apology on his daily audio commentary. The pig remarks sparked outrage on social media across the border as internet users condemned them as derogatory. Some Chinese web users called for Hong Kong's financial community to denounce Donovan's comments. China's pig farms have been plagued in recent months by African swine fever, with some sick livestock being imported to Hong Kong, causing havoc with the city's pork supplies. Last November, Italian fashion label Dolce & Gabbana was forced to cancel a major show in Shanghai after an outcry over an advert featuring a Chinese model and subsequent racist comments about Chinese people by co-founder Stefano Gabbana on social media platform Instagram. The Chinese Securities Association of Hong Kong, which represents over 100 Chinese securities firms, criticised the apology as insincere. It said Donovan and UBS's statement on the "innocently intended" comments was even more humiliating. It demanded Donovan be sacked as punishment and UBS's management exercise social and corporate responsibility. ^ top ^

Pacts, statement shore up Kyrgyz ties (China Daily)
2019-06-14
China and Kyrgyzstan signed a number of cooperation documents covering such areas as infrastructure, investment, law enforcement and trade during President Xi Jinping's state visit to the Central Asian country on Thursday. The signing ceremony was witnessed by Xi and Kyrgyz President Sooronbay Jeenbekov in Bishkek, the capital. The two leaders also signed a joint statement to further deepen the comprehensive strategic partnership between the two countries. The two presidents spoke highly of the cooperation outcomes in all areas between the two countries, and agreed to promote the China-Kyrgyzstan comprehensive strategic partnership to a higher level. Since the establishment of diplomatic relations 27 years ago, bilateral ties have stood the test of international situations and developed with a big leap, Xi said. Xi appreciated Jeenbekov's friendly stance on Kyrgyzstan's developing its relationship with China. China will continue to support Kyrgyzstan to practice the development path it chooses and supports the Kyrgyz government's domestic and foreign policies to safeguard its national independence, sovereignty and security, he said. China would like to work with Kyrgyzstan to develop the traditional friendship, deepen mutual beneficial cooperation and bring more benefits to the people of both nations, Xi said. As long as the two countries continue to enhance mutual support and promote cooperation in all areas, the prosperous path of China-Kyrgyzstan common development will widen, he added. Xi pointed out that jointly building the Belt and Road has become a main focus for China-Kyrgyzstan cooperation. The two countries should promote the further connection of their development strategies, tap new potential for cooperation and explore new space for cooperation, he said. The two countries should expand cooperation in economic and trade areas and implement major cooperation projects, Xi said. China would also like to increase imports of green and premium agricultural products from Kyrgyzstan, he added. Xi reaffirmed China's commitment to supporting the economic and social development of Kyrgyzstan, saying that China will make joint efforts with Kyrgyzstan to carry out such projects as clean drinking water, roads and hospitals to improve people's livelihoods. Xi called on the two countries to upgrade security cooperation and fight against the three evil forces of terrorism, separatism and extremism, as well as cross-border organized crime and drug trafficking. Xi said that China supports Kyrgyzstan in its hosting of the SCO Bishkek Summit, and China encourages all sides to reach more consensuses. Saying that he has met with Xi three times in a little over a 12-month period, Jeenbekov emphasized that this reflected the high level of bilateral relations. Kyrgyzstan will always be a good neighbor, friend and partner of China, he said. Kyrgyzstan firmly upholds the one-China policy, and the ethnic affairs in China are the country's domestic affairs, he said, adding that Kyrgyzstan supports China's measures on ethnic affairs. Kyrgyzstan would like to connect its development strategies with the Belt and Road Initiative and enhance cooperation in such areas as trade, investment, energy, agriculture, infrastructure and local-level exchanges, he said. ^ top ^

China appears set to snub Canadian PM Justin Trudeau until Huawei's Meng Wanzhou is released, following his plea for Michael Spavor and Michael Hovrig (SCMP)
2019-06-13
China said that Canada should take the "entire responsibility" for a spiralling diplomatic row on Thursday, and appeared to imply that only the release of Huawei CFO Meng Wanzhou – who is being held by Canadian authorities ahead of possible extradition to the US – could normalise relations. The remarks came after Ottawa said on Wednesday that Beijing had spurned a request by Canadian Prime Minister Justin Trudeau in January for a call with Premier Li Keqiang to "personally advocate" for the immediate release of two Canadians being held by Beijing on spying charges, and for clemency in the case of another citizen sentenced to death for drug trafficking. Chinese foreign ministry spokesperson Geng Shuang, when asked on Thursday by CBC whether diplomatic relations between the countries were frozen, said: "The current setback China-Canada relations face are entirely caused by the Canadian side itself, and the responsibility lies entirely with Canada, too. "We hope that Canada will take seriously our severe concerns and immediately release Ms Meng Wanzhou, and actively take substantial measures to push China-Canada relations back on track as soon as possible." Relations between the two countries have deteriorated since December when police in Vancouver detained Meng on a US arrest warrant, with the US saying she had committed fraud connected to an alleged breach by Huawei of US sanctions on Iran. Days later China arrested two Canadians – former diplomat Michael Kovrig and businessman Michael Spavor – in what is widely seen as a tit-for-tat move. Geng said on Thursday he had not heard of the approach. China has said it suspects Spavor and Kovrig – who works for the International Crisis Group think-tank – of separately collecting and stealing state secrets. Trudeau has said the pair were detained "for political reasons". Canadian foreign minister Chrystia Freeland last month said she had also sought a meeting with her Chinese counterpart, Wang Yi, to no avail. China has also blocked Canadian agricultural shipments worth billions of dollars. Meng is living in one of her Vancouver mansions on bail, awaiting an extradition hearing that is expected to start in early 2020. Spavor and Kovrig are being held in undisclosed locations. Canada's foreign ministry said that its China consular officials visited Kovrig on Wednesday, the eighth time they have seen him since his detention. ^ top ^

SCO Bishkek summit to promote SCO community with a shared future (People's Daily)
2019-06-13
On June 12, Chinese President Xi Jinping started his trip to Kyrgyzstan for a state visit and the 19th Meeting of the Council of Heads of Member States of the Shanghai Cooperation Organization (SCO) in Bishkek, capital of Kyrgyzstan. He will hold discussions with SCO heads of state on the development of the organization as well as the future of regional cooperation. China and Kyrgyzstan are friendly neighbors. They have maintained sound and stable development of bilateral relations since the establishment of their diplomatic ties 27 years ago. The two countries witnessed constantly consolidated political mutual trust, comprehensively promoted pragmatic cooperation in economy, trade, and cultural exchanges, as well as continuously expanded and deepened security cooperation. Head-of-state diplomacy plays a fundamental role in the continuous development of China-Kyrgyzstan relations. In September 2013, China and Kyrgyzstan established strategic partnership when President Xi paid his first state visit to Kyrgyzstan. The strategic partnership was later lifted to a comprehensive strategic partnership last June during the first state visit of Kyrgyz President Sooronbay Jeenbekov to China. Today, President Xi's second state visit to Kyrgyzstan and his attendance at the SCO summit will inject strong impetus into the comprehensive strategic partnership between the two countries and usher in a new chapter of their efforts to build a community with a shared future. In recent years, the joint construction of the Belt and Road Initiative (BRI) has opened up broad prospects for China-Kyrgyzstan cooperation in various areas. As one of the earliest supporters and participants of the BRI, Kyrgyzstan regards the joint construction of the BRI as a new opportunity to seek cooperation and promote development. In the past April, President Jeenbekov attended the Second Belt and Road Forum for International Cooperation in Beijing, during which the two heads of state agreed to enhance the alignment between the BRI and the 2040 National Sustainable Development Strategy of Kyrgyzstan to achieve more fruits in the bilateral friendly cooperation and bring more benefits to the people of the two countries. Both sides will earnestly implement the important consensus reached by the two heads of state, and take joint construction of the BRI as a great opportunity to boost all-round mutually beneficial cooperation. As founding members of the SCO, China and Kyrgyzstan have carried out productive bilateral cooperation and multilateral cooperation within the framework of the SCO. Last June, the first SCO summit after the expansion of the organization was successfully held in Qingdao, east China's Shandong Province, marking a new starting point for higher stage of development of the SCO. Over the past year, each party concerned has actively implemented the outcomes of the SCO Qingdao summit. Since assuming the SCO rotating presidency, Kyrgyzstan has delivered on its commitments earnestly, endeavoring to promote the implementation of various new initiatives and new measures. In April 2019, a meeting of SCO-Afghanistan Contact Group was held in Bishkek, further reinforced the coordination of the SCO on issues concerning Afghanistan. In the past several months, the Defense Ministers' Meeting of the Member States of the SCO, the SCO Security Council Secretaries meeting, and the meeting of SCO Council of Foreign Minister were held successively. During the meetings, various parties had in-depth exchanges of views on SCO cooperation in diplomacy, security, economy and trade, technology, and culture. These meetings helped deepen political consensus, expand pragmatic and security cooperation, and improve SCO's international influence, laying a solid foundation for the SCO Bishkek summit. The SCO has also held a number of other events under the framework of the organization that further strengthened the connection and friendship among SCO members, such as media forum, women's forum, and the International Issyk-Kul Marathon of the SCO. The ideas of building a new type of international relations, building a community with a shared future for mankind, and the joint construction of the BRI have won wide support in member states of the SCO. By actively promoting the alignment of development strategies, the parties concerned have opened up a vast space and created bright prospects for win-win cooperation of the SCO. The cooperation on the joint construction of the BRI has brought tangible benefits to the people of relevant countries. Practice has proved that the SCO is a new type of dynamic and influential organization for regional cooperation. It regards "Shanghai Spirit" as its original aspiration and the source of vitality. At present, when the international and regional economic and security situation is undergoing complicated and profound changes, the SCO comes to a new starting point. It's believed that the SCO Bishkek summit, while pressing ahead with the direction and goals of the organization, especially the ones set at the SCO Qingdao summit, will chart the course for future development of the organization, formulate a community with shared goals in safeguarding security and development, and promote the development of the SCO community with a shared future. ^ top ^

'Chinese' cyber spy ring accused of targeting key players in Belt and Road Initiative (SCMP)
2019-06-13
A cyber espionage group is believed to be targeting key countries for China's Belt and Road Initiative with a particular focus on sectors such as engineering, transport and defence, a US security firm has warned. In its "M-Trends 2019" report, FireEye, which has been active in exposing Chinese espionage activities in the past, identified the group as Advanced Persistent Threat 40 (APT40), saying its researchers had concluded with "high confidence" that it was part of China's online spying operations. It said the group's activities dated back to at least January 2013 and its victims included "maritime targets, defence, aviation, chemicals, research/education, government and technology organisations". "Target countries are concentrated in Southeast Asia or are host to global entities involved in maritime issues, such as shipping or naval technology," the report said. The research report, which is released annually, said that APT40 targeted government-sponsored projects and was collecting "business intelligence on major projects and agreements" related to the Belt and Road Initiative. "The group's operations tend to target government-sponsored projects and take large amounts of information specific to such projects, including proposals, meetings, financial data, shipping information, plans and drawings, and raw data," it said. In addition, the report said that Chinese cyber espionage groups had also extended their reach into politics. "Recently, Chinese groups have been targeting and monitoring elections in neighbouring countries more closely than before, suggesting a more active effort to protect Chinese investments overseas, especially as the country seeks to expand its global influence," it said. FireEye said there was evidence linking the group to internet protocol addresses located in Hainan and other parts of China, its operations followed typical Chinese working hours and it used malware known to have been used in other Chinese cyber operations. Greg Walton, an independent cybersecurity specialist who previously worked as a consultant for FireEye, said Chinese cyber espionage networks were known to use Hainan IP addresses before. He said the island province was also home to a Chinese signals intelligence facility and a technical unit of the People's Liberation Army. The FireEye report said APT40's activities lessened after September 2015, when Chinese President Xi Jinping reached an agreement on cybersecurity with former US president Barack Obama, but they had surged since December 2017. Although APT40 has attracted the attention of international security agencies, the report said the group was expected to remain active. "Since 2013, APT40 has come to leverage an enormous library of tools and can shift operations to new targets as required," it said. "Despite increased public attention, APT40 has remained undeterred from conducting cyber espionage operations, and we anticipate its operations will continue through at least the near and medium term." The report also found that North Korea, Iran and Vietnam have emerged as major players in international cyber espionage. "We tend to get called in for Chinese state-sponsored activities, and for many years that was it. But in the last three years, we've seen a proliferation of [other countries] like Iran, North Korea, Vietnam, a US-based financially motivated attacker … we're seeing a lot more different types of actors," Grady Summers, FireEye's chief technology officer, said at a briefing on the report on Wednesday. For example, a Vietnam-based cyber attacker group, APT32, was likely to have been behind an email phishing attack targeting officials in Vietnam and Cambodia between March and May this year, while cyber attackers in North Korea had previously targeted financial institutions in developing countries and foreign firms operating in Asia. ^ top ^

China will fight to end if U.S. keeps escalating trade frictions: MOC (Xinhua)
2019-06-13
"China will fight to the end if the United States continues to escalate trade frictions," the Ministry of Commerce (MOC) said Thursday. China will not give ground on issues of principle during bilateral economic and trade talks, which are clearly stated in a white paper on bilateral trade consultations issued earlier this month, MOC spokesperson Gao Feng told a press conference. In response to the new threat of tariffs by the United States, Gao said China is firmly against U.S. unilateralism and bullying. "China's stance on trade war has been consistent and clear. We do not want, but is not afraid of a trade war. The United States has taken a practice of maximum pressure and continuously escalated trade frictions, causing serious setbacks in the China-U.S. trade talks, according to Gao. "The United States is entirely to blame." "China's attitude is very clear. The United States must change its attitude, show sincerity and correct its wrong practices if it wants the talks to continue," Gao said. ^ top ^

Chinese HIV carriers eye cheaper drugs in Thailand, India (Global Times)
2019-06-13
Certain group of people living with HIV in China reportedly look to countries like Thailand and India for cheaper medicines with fewer side effects, or through sales agents, after they found few channels to buy the latest AIDS medicines. They would regularly visit those countries, and even Africa, or through an agent, to purchase anti-AIDS drugs which are cheaper than in China, said sales agent Cheng Shuaishuai, who is now involved in AIDS counseling and drug sales business. Those countries, including India and Thailand, have the latest drugs, such as Tivicay and Triumeq, at lower prices because they are the generic versions, the Beijing News reported on Thursday. However, for patients in China, accessing such medicines is not easy. The country has been speeding up the inclusion of such medicines in the medical insurance. For example, China provides patients anti-virus medicines for free, but the list has not been updated since 2007; its health insurance has covered several new anti-AIDS drugs, such as Rilpivirine, since 2017, which lowers the prices from 1,200 yuan ($173) per box to 100 yuan after reimbursement - almost as low as the prices in Thailand. However, only some patients living with HIV are qualified to receive free drugs and the some drugs have strong side effects. The latest medicines are not included in the free list nor covered by medical insurance. The price of Triumeq, a combination of abacavir, dolutegravir and lamivudine to treat HIV type 1 infections, which only needs to be taken once a day, costs 2,900 yuan in China, while it is only 500 yuan for the generic Indian version. Discounts for new drugs are only available in certain big cities for people with insurance, Xiao Dong, founder of a Beijing-based HIV care organization, told the Global Times. Insiders also explained that those who call themselves public figures would insist on going abroad to avoid damaging their images due to the disease. Many patients have turned to sales agents to purchase medicines from abroad in recent years, but some claim they got swindled by these "drug traffickers," who received their money but failed to provide the medicine. Some patients urged the government to update the free drugs list to satisfy their needs. But an expert from an AIDS treatment group under the National Health Commission said that the group had several discussions about adjusting the list. However, they could not agree on the prices of these drugs and the government has a limited ability to pay. The Beijing News reported that the government has to provide 2,000 yuan for each person on the free list a year; if the new medicines were added, the price would rise to 5,000 yuan. The number of AIDS patients given free treatment increased from 171,000 in 2012 to 610,000 in 2017. According to a joint evaluation of the Chinese Center for Disease Control and Prevention, UNAIDS and the World Health Organization, around 1.25 million people will suffer from HIV in China by the end of the year, with 80,000 newly-infected people each year, the Xinhua News Agency reported in 2018. As part of the country's efforts to prevent and control HIV, a joint statement from the Ministry of Finance and the State Administration of Taxation said China would continue to exempt the production and distribution of domestic anti-HIV medicines from value-added tax until the end of 2020, Xinhua reported. ^ top ^

Why Trump's clampdown on academia is forcing many Chinese researchers into a difficult corner (SCMP)
2019-06-13
Science knows no borders. But if it does, the United States has a lot to thank China for in helping to build its global tech supremacy. More than 10 per cent of US inventions today are made by scientists of ethnic Chinese origin, according to research in a recent book by Harvard professor William R. Kerr. And most of the artificial intelligence scientists in the US who are immigrants came from China, according to research by think tank MacroPolo. Collectively known as scientists "with Chinese origin", they are a core building block of the US technology ecosystem and a group that is facing increased scrutiny in the US due to concerns over possible espionage. "The policies of the Trump administration to weaken Chinese talent for America are foolish," said Kerr, a professor of business administration at Harvard Business School and the author of the The Gift of Global Talent. "The United States needs to ensure good intellectual property protection, but efforts to isolate and diminish the Chinese talent component can have long-term negative consequences for our country," he said. How to protect intellectual property without scaring away some of the world's top talent is a major challenge for the Trump administration as many of China's best and brightest currently contribute a great deal to US innovation, and they are now caught in the middle of the raging US-China tech war. Chinese talent, especially those who study and work in sensitive technology fields, have had to deal with shorter visa times, delays and even denials of visa requests in the US. China's Education Ministry issued a warning on Monday about the risks of studying in the US, urging students and academics to "raise their risk assessment" after visa denial rates soared. Some Chinese researchers have been denied access to certain research facilities. In mid May, Georgia-based Emory University abruptly dismissed two Chinese-American professors due to alleged undisclosed funding ties with China. Some of the targeted US measures are considered "necessary to punish wrongful behaviour and prevent future violations", wrote Cheng Yangyang, a particle physicist and a postdoctoral research associate at Cornell University, in her monthly column Science and China, published on digital media title SupChina at the end of May. But recent US moves have prompted fears in the Chinese-American community due to "the appearance of racial profiling and the potential rekindling of 'Yellow Peril'," wrote Cheng, declining to comment further when reached by the Post. For decades, educational exchanges have been a strong point in forging closer ties between China and the US. The surge in Chinese students and scientists has boosted diversity at American universities. Their skills and hard work have helped bolster the research credentials of US universities – not to mention the tax dollars contributed to the US economy. According to Harvard's Kerr, talent inflows have reshaped US innovation in advanced technology sectors with contributions from immigrants in sectors from computer science to biotech increasing dramatically over the past 40 years. People with Chinese ethnicity, many of whom are immigrants, account for slightly more than 10 per cent of US inventions, a big increase from 5 per cent in 2005. But the Trump administration appears to have decided that this is now a zero-sum game – and that academics from nations under suspicion should be kept out of areas of hi-tech research and development. Scientists and students with Chinese origin are seen by some US politicians as agents of Beijing, helping China to "steal its way up the economic ladder" at the United States' expense. "China has pioneered a societal approach to stealing innovation in any way it can, from a wide array of businesses, universities and organisations," said Christopher Wray, the director of the Federal Bureau of Investigation in April. To be sure, there have been some high profile espionage cases. In September 2018, a Chinese electrical engineering student named Ji Chaoqun was arrested in the US and accused of acting as an "illegal agent" on the direction of a "high-level [Chinese] intelligence officer" in the Jiangsu Province Ministry of State Security, according to the US Department of Justice. An email Ji sent to a Chinese national two years ago allegedly contained background reports on eight US-based individuals that Beijing could target for potential recruitment as spies. As such, there has been rising concern within the FBI that US universities have become soft targets for foreign intelligence services to access emerging technologies in "non-traditional" ways. These fears have increased as a growing number of Chinese scientists and students in recent years – known as sea turtles – have returned to the motherland after years of study and work in the US. Sea turtles is a homophone for a Chinese term denoting overseas returnees. Of the Chinese students who had earned PhDs in the United States around 2003, 86 per cent of them were still in the US in 2013. But that trend has changed in recent years. According to the latest data from China's Ministry of Education, nearly 5.86 million Chinese studied overseas from 1978 to the end of 2018. Among them, over 1.53 million are still in the process of studying and conducting research overseas, but about 85 per cent of the remainder who have already completed their studies, chose to pursue a job in China after completing their studies. "Years ago, if you were an engineer, you probably couldn't find any decent jobs in China," said Matt Sheehan, a fellow at MacroPolo, the in-house think tank of the Paulson Institute in Chicago. "But now, China is richer, the tech ecosystem is better. Many graduates return from Silicon Valley because if they want to set up start-ups, there would be no better place than China where they know the language and culture." According to MacroPolo's latest research, the US is still the most attractive destination for China's top talent both for study and work. In the field of AI, where the US and China are locked in a race for global dominance, about a quarter of the top 20 per cent AI research talent in the world are Chinese-born. Among them, nearly 60 cent are currently affiliated with US institutions for work or study. "But these trends – particularly for where Chinese-born researchers go to school and work – are heavily influenced by policy changes and the overall climate between the Chinese and American technology ecosystems," said Sheehan, adding the current climate is likely to accelerate the returning trend of Chinese scientists and students. China has launched several State-sponsored programs, including the controversial Thousand Talent Plan, to lure foreign-trained top talent with generous packages, from research funding to tax cuts. The programs form part of China's bolstered efforts to cut reliance on foreign technologies following Chinese President Xi Jinping's repeated calls for "indigenous innovation" in core technologies since taking power in 2012. "The US universities are still superior in both education and research. Best minds attract the best. But the current trade/tech war will have a big psychological impact on Chinese students and scholars working in the US," said Junhui Qian, a professor at Antai College of Economics and Management with Shanghai Jiao Tong University. "China will become even more attractive when they think about their future career. In this sense, the Trump administration is actually helping China and damaging US interests," said Qian, who is also a sea turtle himself as he returned to China after obtaining a PhD degree in economics from Rice University in Texas. One of China's top schools, Jinan University, has already offered to take in the two Chinese-American professors who were sacked by Emory University. Song Xianzhong, president of Jinan University in Guangzhou, said in late May that his college would welcome Li Xiaojiang and his wife, Li Shihua, as well as their research team, if they wanted to return to China. The Lis have served as visiting professors at Jinan University's Guangdong-Hong Kong-Macau Institute for CNS Regeneration since 2017. "The trade frictions between China and the US are bound to affect talent," Song said. "We believe [Chinese] universities can hire [academics affected by the conflict] and they can contribute to social and economic development if they decide to come back." Nevertheless, even if they are welcomed back by China, many Chinese scientists working in the US today may feel conflicted about returning home. "For Chinese scientists who emigrated to the US, where do their hearts and bodies belong?," Cheng asked in one of her columns. "In their home country, where an authoritarian government is increasing its hold on society, aided by technology for surveillance and censorship? Or in a country whose president actively rejects them, where they are painted as spies?" ^ top ^

Chinese premier underlines mass entrepreneurship, innovation (Xinhua)
2019-06-14
Chinese Premier Li Keqiang on Thursday called for further boosting mass entrepreneurship and innovation to better stabilize employment, promote innovation and strengthen new growth impetus. Li made the remarks when addressing an activity in Hangzhou, capital city of east China's Zhejiang Province, on the country's efforts to promote entrepreneurship and innovation. Calling mass entrepreneurship and innovation "important pillars" of China's economic resilience, Li said the country can withstand downward economic pressures and maintain long-term economic fundamentals by stimulating market players' vitality and social creativity. "Mass entrepreneurship and innovation provide strong support for employment," Li said, noting that the initiative has created broad employment opportunities for Chinese people, especially young people. Governments at all levels should deepen reform to streamline administrative approvals, delegate power to lower levels and improve regulation and services, Li said, adding that they must also improve the business environment and further implement measures to cut taxes and fees on a larger scale. "Business starters and innovators should carry forward the spirit of entrepreneurship, craftsmanship and professionalism, be down to earth, and start with details in pursuit of excellence to turn their subtle ideas into reality," Li said, calling on them to win the market with products and services that can be well-received by consumers. ^ top ^

China restricts developed regions from 'mining' talent from central, western areas (Global Times)
2019-06-13
The Chinese central government issued a guideline on Wednesday, restricting China's developed regions from drawing talent from the northeast, central and western regions through one-sided measures such as promising high salaries and special benefits. The document, jointly issued by the General Office of the CPC Central Committee and the General Office of the State Council, is aimed at supporting stable talent pools in less-developed regions, guiding scientific workers to pursue theoretical breakthroughs and creating a sound research environment. In recent years, many universities in eastern and southern China have lured professors and researchers from central and western regions with such incentives as annual salaries that exceed 1 million yuan ($144,500), home-purchase subsidies and research budgets ranging into tens of millions of yuan. In one extreme case, industry insiders said that enough top experts have left Lanzhou University, a prestigious school in Northwest China's Gansu Province, to provide the staff for setting up another university that is equal in terms of scientific research, caijing.com reported. The outflow of talent from central and western China has resulted in a lack of experts in those regions, which widened the imbalances in economic development between China's east and west. "Due to their natural environment and economic strength, western areas do not seem to appeal to top experts as much as eastern regions," said Li Shuohao, a professor at Lanzhou University, indicating that the central government should have come up with such an approach earlier to arrest the trend. Li also suggested that China should tilt more educational resources to support the central and western regions' development. Another research fellow from a western university, who asked not to be identified, said the guideline is just a warning. He suggested that China needs a complete mechanism to manage and supervise the research talent market. ^ top ^

China cybersecurity rule on exporting of personal information seen raising compliance costs for firms (SCMP)
2019-06-13
China has emphasised national security in a draft rule on the export of personal information, a move that would likely drive up the cost of compliance for foreign companies. Personal information gathered inside China will not be allowed to be transferred across borders if it can "impact national security, damage public interest or is not fully secured", according to the draft rules published on Thursday by the Cyberspace Administration of China (CAC). Many countries, including the European Union, also have regulations on cross-border transfer of personal information, though they are formulated mostly to protect the privacy of citizens. Chinese President Xi Jinping has sought to rally support for "cyber sovereignty", the idea that all countries have the right to regulate the internet within their own borders. "China is unique in that its pushing this so hard and under many different standards, measures and regulations," said Nick Marro, Hong Kong-based analyst with The Economist Intelligence Unit. "It's just that implementation has ended up being a lot more complex. That is why the compliance burden for foreign and Chinese companies is so high." The draft rule on the export of personal information is open for public feedback until July 13 and is the third cybersecurity-related regulation published by the CAC since late May. The regulatory move also comes amid the escalating trade war between China and the US, in which national security concerns have been used as the justification for Washington's trade ban on Chinese tech champion Huawei Technologies. Under the draft rule, which according to CAC involves several tasks including "protecting personal information security, maintaining cyberspace sovereignty and national security", all network operators including internet service providers, are required to do assess the security implications and notify cyberspace authorities before exporting personal information. The draft rule should raise the costs of compliance for companies that operate in China and have to send personal information across borders. "For example, if you are sending salary information, health information on your Chinese employees to your global database to get a sense of your company's diversity, then you will need to understand how this regulation will unfold," said Marro. Consumer-facing companies could also be hit if they need to send Chinese consumers' data to a data processing unit or analytics team outside China, he added. In another draft rule released in late May, China required information infrastructure operators to evaluate national security risk when purchasing foreign products and services. That could be seen as a way for Beijing to ban foreign tech suppliers on national security grounds, according to Samm Sacks, cybersecurity policy and China digital economy fellow at New America, a US-based think tank. ^ top ^

Nation hottest global investment destination (Global Times)
2019-06-13
China remains the hottest investment destination in the world thanks to its complete industrial system and promising consumer market, Gao Feng, the spokesperson for the Ministry of Commerce, said at a press briefing on Thursday in Beijing, rebutting reports that US tariffs are causing some companies to leave China. "China has formed a complete industrial system with an accommodating basic infrastructure. The business environment is also improving, and the consumer market is also upgrading and has bright prospects," Gao said. He also noted that surging foreign direct investment (FDI) in China also showed foreign investors' confidence in the Chinese economy and market. In the first five months, China's actual use of FDI in US dollar-denominated terms increased 3.7 percent year-on-year to $54.61 billion. Specifically, US investment in China was up 7.5 percent. Also, the cost of US tariffs on Chinese goods are passed to US importers, retailers and consumers, Gao said, quoting reports from the IMF and other institutions such as JPMorgan and Goldman Sachs. ^ top ^

China encourages businesses to diversify foreign trade markets (Xinhua)
2019-06-13
The State Council, China's cabinet, has urged domestic businesses to diversify foreign trade markets to promote greater opening-up. Exploring diversified international markets will help boost steady growth in foreign trade and keep the country's economy running smoothly, according to an executive meeting of the State Council chaired by Premier Li Keqiang. Li urged efforts to sign high-standard free trade agreements and regional trade agreements with more countries, and expand comprehensive cross-border e-commerce pilot zones. Enterprises are encouraged to increase imports and improve their international marketing networks to export more products catering to the needs of international markets, according to Li. The meeting urged related departments and local governments to further streamline customs clearance by cutting time and requirements of unnecessary physical regulatory credentials and by improving work efficiency. By May, China has beat its target this year of cutting the overall trade customs clearance time by half compared with 2017. The meeting also called for enhanced market regulatory mechanism to improve social credit system. A blacklist will be developed to punish credit defaulters via a cross-sector, cross-field and cross-department regulatory framework. Credit information security should be maintained while commercial secrets and individual privacy must be protected, and irregular practices will be cracked down upon, the meeting pointed out. ^ top ^

China to boost social credit system with new market regulatory measures (Xinhua)
2019-06-13
China will step up the building of social credit system by rolling out new market regulatory measures, the State Council announced at the latest executive meeting chaired by Premier Li Keqiang. The Chinese government puts strong emphasis on the building of a social credit system. Li urged improving the credit-based regulatory framework and applying an inter-agency approach in penalizing acts of bad faith. "Credit-based regulation is crucial for the sound workings of market institutions. In developing the socialist market economy, the government must reform its functions and foster an enabling business environment. While streamlining administration and delegating powers, we will enhance oversight where necessary. And credit-based regulation is the foundation of this endeavor." Li said. It was agreed at the meeting that the country will establish, in accordance with the law, authoritative, unified and accessible credit records of all market players based on their unified social credit codes. Government departments are required to share the information as permitted by law to break information monopoly and information silo. No government agencies should repeatedly ask market players to provide the same information that can be shared. The mechanism of credit pledge by market players should be promoted, under which applications under certain government review items will be processed right away when applicants pledge to have met eligibility requirements and submit needed documentation. A credit "blacklist" system will be further developed together with norms to go by in determining entities to be put on the list to enhance inter-agency punishment for acts of bad faith. Strict penalties, including denying market access, will be meted out to actors of bad faith in accordance with laws and regulations. Tiered credit-based regulation will be promoted through inspections by randomly selected inspectors against randomly selected market players and prompt release of inspection results. The ratio of inspection targets and frequency of inspection shall be decided in light of the credit records of market players. "The effective tool of penalties for acts of bad faith must be fully harnessed. The price to pay for institutional violations, breach of laws and even legal offenses now is too low. That is the underlying reason why some market players chose to cross the line," Li said. "We must establish and enhance a cross-sectoral, inter-agency mechanism to deal with such behaviors." The meeting also called for applying the Internet Plus model and technologies such as big data to make regulation over acts of bad faith more timely, precise and effective. The government will safeguard credit information security and stringently protect trade secrets and individual privacy. Any leakage, falsification or exploitation of credit information for personal gains will be seriously dealt with. "We need to follow the laws of the market," Li said. "Punitive measures such as blacklisting actors of bad faith and denying them market access can also help motivate market players to abide by the law. This will improve our social credit system and market environment." ^ top ^

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'Sky Road' brings high rewards to Tibet (China Daily)
2019-06-14
Gyara Gyatso has spruced up the rooftop patio at his hotel just in time for the hot months ahead, incorporating floral lumbar pillows, blue-patterned dinnerware and a separate beverage cart. In one corner, cozy pieces of furniture face the gilded, bronze-tiled roof of the nearby Jokhang Temple. When the lights are turned on at night, Gyara Gyatso invites the hotel's guests to come to the patio, lie on sofas and appreciate the temple's glowing, golden roof under an array of stars while sipping cups of homemade highland barley wine or yak's milk yogurt. Summer breezes caress Lhasa, capital of the Tibet autonomous region, bringing the city's best views of the year along with tens of thousands of tourists seeking Tibet's romance, all carried by the Qinghai-Tibet Railway, aka the "Sky Road". Gyara Gyatso, who owns two hotels, is preparing for his busiest time of the year. "In May and the following five months, Lhasa Railway Station will see thousands of people every day, most of them from other parts of China," said the 37-year-old native of Shigatse, a city 285 kilometers from the regional capital. In the past decade, the tourism boom that has resulted from Tibet's greatly improved transportation infrastructure has seen a growing number of locals and people from neighboring provinces, such as Qinghai and Sichuan, flooding into Lhasa to seek business opportunities. For centuries, Tibet was cut off from the outside world by its remote location, extreme climate and intimidating altitude. Until the Qinghai-Tibet Railway opened in 2006, connecting the region more closely with the rest of China and the world, the massive Tibetan Plateau thwarted all but the boldest travelers and explorers. The 1,956-km railway-China's highest and longest train route-is a feat of modern engineering that any country would be proud of. As transportation has always been an engine of economic and social development, it has put Tibet's economy on a fast track. Statistics from the regional development and reform commission show that Tibet's GDP topped 147.7 billion yuan ($21 billion) last year, five times more than before the railway opened. Meanwhile, the average annual per capita disposable incomes of rural and urban residents reached 11,450 yuan and 33,797 yuan respectively. ^ top ^

UN rights chief Michelle Bachelet welcome to visit Xinjiang, Chinese ambassador says (SCMP)
2019-06-13
China's envoy in Geneva said on Thursday that he hoped UN human rights chief Michelle Bachelet would visit China, including Xinjiang, where he said "education training centres" were helping to stamp out extremism and give people new skills. China has been condemned internationally for setting up complexes in the remote western region of Xinjiang that UN experts describe as mass detention centres holding more than 1 million ethnic Uygurs and other Muslims. "We hope to see the high commissioner pay a visit to China, including a trip to Xinjiang to see for herself … Seeing is believing," Chen Xu, China's ambassador to the United Nations in Geneva, told a news conference hosted by the UN correspondents' association, ACANU. "The invitation to the high commissioner is always there, we hope to define a time which is convenient to both sides," he said. "What is happening in Xinjiang is education training centres help young people, especially young people, to get skills, to be well-equipped for their reintegration into society," Chen said, adding that "there are no so-called re-education camps". Bachelet's approach was one of "dialogue and cooperation", he said, contrasting this with that of her predecessor Zeid Ra'ad al-Hussein. "I think this is the right direction." A spokeswoman for Bachelet's office had no immediate comment. Bachelet, a former president of Chile who has been UN high commissioner for human rights since August, has repeatedly pushed China to grant the United Nations access to investigate reports of disappearances and arbitrary detentions, particularly of Muslims in Xinjiang. China has previously said it would welcome UN officials if they avoid "interfering in domestic matters". Addressing the UN Human Rights Council in March, Chinese foreign vice-minister Le Yucheng defended the complexes in Xinjiang, saying the "campuses" would be closed down gradually as extremist ideology was vanquished in the region. ^ top ^

Any attempts to interfere with China's internal affairs doomed to failure: spokesperson (Xinhua)
2019-06-11
China's Ministry of Foreign Affairs on Tuesday refuted U.S. Secretary of State Mike Pompeo's remarks on Xinjiang and stressed that any attempts to interfere with China's internal affairs are doomed to failure. Foreign ministry spokesperson Geng Shuang made the comments at a daily press conference in Beijing. Geng said judging from his untrue words, Pompeo lacked the most basic knowledge and understanding of China's Xinjiang. The so-called "re-education camps" do not exist in Xinjiang, Geng said. "The vocational education and training centers in Xinjiang, launched in accordance with the law, aim to help those who are eroded by terrorism and extremism to return to the right track, and help them obtain skills to support themselves and reintegrate into society." No violent and terrorist incidents have happened in Xinjiang over the past three years since the establishment of the education centers, and the security situation has significantly improved in the region, he said. Geng said people of all ethnic groups in Xinjiang enjoyed full freedom of religious belief in accordance with the law, a fact which is obvious to all. According to Geng, Xinjiang currently has 24,400 Mosques, which means one for every 530 Muslims. "The number of Mosques in the United States is less than one-tenth of that in Xinjiang, according to open data," Geng said. The Uygur culture has been effectively protected and promoted, and the Uygur people in Xinjiang enjoy the right to use their own language in accordance with the law, Geng said. "Pompeo appeared to lack the most basic knowledge and understanding of China's Xinjiang, but this is not the point. The point is that he does not want to see a true Xinjiang," Geng said. "It is a matter of different nature if one ignores facts and truth, is addicted to fabricating lies and fallacies, and attempts to use human rights and religion as an excuse, to interfere with China's internal affairs." "I need to remind Pompeo that his public performance fully exposes his true colors," Geng said, noting "any attempts to interfere with China's internal affairs are destined to fail." ^ top ^

Foreign gov'ts and politicians urge restraint and dialogue over Hong Kong anti-extradition law clashes (HKFP)
2019-06-14
Foreign governments and politicians have urged for restraint and dialogue after clashes over a controversial extradition bill in Hong Kong left multiple people injured. The occupation of the area outside the legislature ended in violence on Wednesday as police deployed tear gas and rubber bullets against crowds advancing forwards throwing objects. The demonstrators blocked major roads in Admiralty throughout the day using makeshift barricades. As of Thursday evening, 81 people injured at the protest had attended 10 public hospitals – two of the cases were serious, according to the Hospital Authority. Police chief Stephen Lo said 22 police officers had also been injured and 11 arrests were made. The US Congressional-Executive Commission on China has urged Chief Executive Carrie Lam to withdraw the extradition bill saying the recent peaceful protests are a strong and profound statement against such amendments. US Representative Jim McGovern of the Commission said that he alongside Senator Marco Rubio and Representative Chris Smith will reintroduce the Hong Kong Human Rights and Democracy Act later in the week to "reaffirm [the] US' commitment to human rights and the rule of law at a time when Hong Kong's autonomy is imperilled by Chinese government interference and revised extradition law." Hong Kong proposed legal amendments in February to allow the city to handle case-by-case extradition requests from jurisdictions with no prior agreements – most notably China and Taiwan. The bill would enable the chief executive and local courts to handle extradition requests without legislative oversight, though lawyers, journalists, foreign politicians and businesses have raised concerns over the risk of residents being extradited to the mainland, which lacks human rights protections. Australian foreign minister Marise Payne called on all sides to avoid violence in a statement on Wednesday. "The Australian Government believes it is important that any changes to Hong Kong's extradition arrangements are pursued in keeping with regular processes of government and resolved in a way that fully respects Hong Kong's high degree of autonomy and upholds the rights and freedoms enshrined in Hong Kong's Basic Law under the 'one country, two systems' framework," it read. Meanwhile, UK Prime Minister Theresa May echoed earlier government views on Wednesday saying that extradition bill must not infringe upon freedoms in Hong Kong. "It is vital that those extradition arrangements in Hong Kong are aligned with the rights and freedoms that were set down in the Sino-British Joint Declaration. We have been unequivocal in our views," she said. A German Federal Foreign Office spokeswoman said the numbers of protesters showed that large sections of Hong Kong's population are opposed to the extradition bill "because they fear that it will lead to an erosion of the rule of law and the autonomy of Hong Kong." "These fears are shared not only by the business and legal circles but also by the international community," she added. "At the same time, we are reviewing whether the existing bilateral extradition agreement between Germany and Hong Kong can continue to be implemented in its present form if the planned extradition law is adopted." The Legislative Council President Andrew Leung cancelled a scheduled full council meeting on Thursday, a day after a second reading of the extradition bill was postponed owing to the protests. Friday's business at the legislature is also cancelled. The Civil Human Rights Front has organised further protests this Sunday and Monday, after it a led a "million-strong" march last Sunday. ^ top ^

'It would become like Xinjiang': Surveillance-savvy Hong Kong protesters go digitally dark (HKFP)
2019-06-14
Hong Kong's tech-savvy protesters are going digitally dark as they try to avoid surveillance and potential future prosecutions, disabling location tracking on their phones, buying train tickets with cash and purging their social media conversations. Police used rubber bullets and tear gas to break up crowds opposed to a China extradition law on Wednesday, in the worst unrest the city has witnessed in decades. Many of those on the streets are predominantly young and have grown up in a digital world, but they are all too aware of the dangers of surveillance and leaving online footprints. Ben, a masked office worker at the protests, said he feared the extradition law would have a devastating impact on freedoms. "Even if we're not doing anything drastic — as simple as saying something online about China — because of such surveillance they might catch us," the 25-year-old said. This week groups of demonstrators donned masks, goggles, helmets and caps — both to protect themselves against tear gas, pepper spray and rubber bullets, and also to make it harder for them to be identified. Many said they turned off their location tracking on their phones and beefed up their digital privacy settings before joining protests, or deleted conversations and photos on social media and messaging apps after they left the demonstrations. There were unusually long lines at ticket machines in the city underground metro stations as protesters used cash to buy tickets rather than tap-in with the city's ubiquitous Octopus cards — whose movements can be more easily tracked. In a city where WhatsApp is usually king, protesters have embraced the encrypted messaging app Telegram in recent days, believing it offers better cyber protection and also because it allows larger groups to co-ordinate. On Thursday Telegram announced it had been the target of a major cyber attack, with most junk requests coming from China. The company's CEO linked the attack to the city's ongoing political unrest. Anxieties have been symbolised in a profile picture that was being used by many opponents of the bill: a wilting depiction of Hong Kong's black-and-white bauhinia flower. But protesters have become increasingly nervous that using the picture online could attract attention from authorities, and have taken it down. "This reflects the terror Hong Kong citizens feel towards this government," said a woman surnamed Yau, 29, who works in education. A protester surnamed Heung told AFP that many people immediately deleted "evidence showing you were present". The demonstrators who spoke with AFP only provided their first or last names due to the subject's sensitivity, and all wore at least masks. Heung, 27, had returned to the area where the protests had taken place to join the clean-up, and she put a post on Facebook calling for helpers. But she was afraid even a call for volunteers would link her to the protests. "Maybe I'll delete the post tonight," she said. "I don't want to become one of their suspects." While Hong Kongers have free speech and do not encounter the surveillance saturation on the mainland, sliding freedoms and a resurgent Beijing is fuelling anxieties and fears. Recent prosecutions of protest leaders have also used video and digital data to help win convictions. Bruce Lui, a senior journalism lecturer at Hong Kong Baptist University, said awareness around security has increased, particularly with China's "all-pervasive" surveillance technology and wide use of facial recognition and other tracking methods. "In recent years national security has become an urgent issue for Hong Kong relating to China. Hong Kong laws may have limitations, but China only needs to use national security to surpass (them)," he said. The city was rattled in recent years by the disappearance of several booksellers who resurfaced in China facing charges — and the alleged rendition of billionaire businessman Xiao Jianhua in 2017. Critics say the extradition law, if passed, would allow these cases to be carried out openly and legally. "One month ago, things were still calm in Hong Kong," said Ben, the office worker. "But in an instant, it has become this. Who knows if it would become like Xinjiang the day after tomorrow, because things can change so quickly," he added, referring to an autonomous region tightly ruled by Beijing. In precarious times, many are holding onto core values. "We're trying to do better with our privacy settings. But we still consider ourselves Hong Kong people, not Chinese, so we still think we have a right to speak out," said Yau. ^ top ^

Hong Kong police arrest 11 riot suspects, calls for rationality voiced in society (Xinhua)
2019-06-13
The Hong Kong police have arrested 11 people related to Wednesday's riot around the complex of the Hong Kong Special Administrative Region (HKSAR) government and Legislative Council (LegCo), with all walks of social life in Hong Kong strongly condemning the rioters' violent acts and calling for returning to rational discussion. The HKSAR government's Commissioner of Police Stephen Lo said at a briefing Thursday afternoon that 11 people have been arrested for disorderly conduct in public place, unlawful assembly, assaulting police officers and other riot-related crimes. Protesters gathered around the complex of HKSAR government and LegCo Wednesday morning before a LegCo meeting originally scheduled at 11:00 a.m. to discuss the amendments to the Fugitive Offenders Ordinance and Mutual Legal Assistance in Criminal Matters Ordinance. The protesters caused severe traffic congestion on nearby roads, tried to storm the LegCo building, and attacked police personnel with sharpened iron poles, bricks, wooden planks and rail barriers, forcing the LegCo meeting to be postponed. "The process was premeditative and they (the rioters) particularly acted in an intimidating and inciting manner," Lo said, "Despite these, the police have adopted a restraint and tolerant attitude." According to statistics from the Hong Kong Hospital Authority, a total of 80 people were injured and hospitalized due to the riot. According to Lo, a total of 22 police officers have sustained injuries in the incident. "We have strongly condemned the violent behavior of the rioters. I have appealed to the public to conduct their public meeting and public procession in a peaceful and orderly manner," Lo said. Stressing that it is the police's responsibility and duty to maintain public order and offer all Hong Kong residents a safe place to live in, Lo said he sincerely hopes that everyone would express their views and opinions in a peaceful, orderly and lawful manner. Numerous organizations in the Hong Kong society expressed strong condemnation of the rioters' disregard for law and violent acts, and voiced support to the police for enforcing law. Ng Wang-pun, president of the Chinese Manufacturers' Association of Hong Kong (CMA), criticized the rioters for blocking traffic, obstructing commercial activities in the area and harming Hong Kong's overall business environment. Tam Wai-chu, a renowned Hong Kong politician and lawyer, warned against the incident's "double strikes" on Hong Kong's economy and rule of law. She called on people in Hong Kong to maintain rationality and urged schools to prevent students from participating in illegal activities. Tse Hiu-hung, president of youth group Hong Kong Youth Enlightenment, said the rioters' violent acts cannot be accepted by any civilized and law-based society. She appealed to young people in Hong Kong to stay calm and rational. The HKSAR government tabled the Fugitive Offenders & Mutual Legal Assistance in Criminal Matters Legislation (Amendment) Bill 2019 at the LegCo for discussion in April. It has repeatedly emphasized that the amendment aims to fill loopholes in the HKSAR's existing legal framework and will help protect Hong Kong's law-abiding general public and business environment. Choi Wong Ling-ling, a member of the National Committee of the Chinese People's Political Consultative Conference, said that she hopes the HKSAR government will continue explaining the amendments to the public to narrow differences and reduce concerns. ^ top ^

Tsai Ing-wen endorsed to run for second term as Taiwan's president (SCMP)
2019-06-13
Taiwanese President Tsai Ing-wen has won her party's nomination to run for a second four-year term after a fiercely fought primary that threatened to divide the ruling Democratic Progressive Party. Tsai defeated former premier William Lai Ching-te by about 9 percentage points to emerge as the winner on Thursday in the two-way race determined by public opinion surveys carried out between Monday and Wednesday. "The results show that the president received a support rate of 35.67 per cent versus Lai's 27.48 per cent," DPP chairman Cho Jung-tai said. The remainder of the more than 16,000 randomly selected voters surveyed by phone were undecided or chose neither candidate. A few hours later, in what analysts saw as an attempt to reunite the party, Tsai called for cooperation with Lai to ensure that the DPP could remain in power. "I always say that one plus one is bigger than two... and I will find a day to sit down and talk to [Lai] about the plan to win the election amid unity, and that day will not be far off," she said, hinting that she might ask Lai to be her running mate. "There are always ups and downs in the primaries and after the dust settles it will be time [for the party] to return to unity." Tsai added that a united front could safeguard the DPP's power, the island's sovereignty and the reforms she had steadfastly promoted during her first term as president. Lai conceded defeat, saying he accepted the result. "I will honour my commitment to support the winner of the primaries," he said. Asked if he would consider being Tsai's running mate, Lai said only that it was important "for all of us to unite to win the election next year". Lai, a former confidant of Tsai's, shocked the party in March by announcing his intention to seek endorsement for a presidential run. Lai had support from the hardline pro-independence heavyweights within the DPP and was seen as a serious challenge to Tsai. His bid threatened to divide the party, which has struggled to win back voters since a crushing defeat in local elections in November. Wang Kung-yi, professor of political science at Chinese Culture University in Taipei, said Tsai's win was expected, given her political resources and general support. "A fierce fight was unlikely to divide the DPP," Wang said, noting the party's record of patching up differences after hotly contested primaries. "Some party stalwarts might quit but no one would follow suit." Hou Han-jun, a professor of public administration and policy at National Taipei University, said Tsai's rebuff of Chinese President Xi Jinping and her support for opponents of Hong Kong's controversial extradition bill propelled her through the primary. "This has helped promote her image and win her the support of the public," Hou said. He said Tsai had two other tailwinds: fears that a disunited DPP would lose the 2020 poll and the inclusion of mobile phone users in the public opinion surveys. Tsai is popular among young voters and previously the surveys were restricted to landline phone users, who tend to be older. Tsai popularity plunged to less than 20 per cent after the DPP's local election defeat last year but it has risen since she rejected Xi's proposal in January for the two sides to hold unification talks under the "one country, two systems" model being adopted in Hong Kong and Macau. Beijing considers Taiwan a wayward province that must return to the mainland fold by force if necessary. It has suspended official exchanges with Taipei since Tsai took office in 2016 and refused to accept the one-China principle. Wang said Beijing would prefer Tsai to Lai, who has publicly declared that he is a "practical pro-independence worker". "Beijing would find it better to deal with her than Lai, given that she has not ventured to cross the independence 'red line'," Wang said. The DPP will officially name Tsai as its presidential nominee during a party meeting on Wednesday. The main opposition Kuomintang party will select its candidate in a similar public opinion survey primary to be conducted over 10 days from July 5. Tsai's opponent in January is most likely to be the KMT's Han Kuo-yu, a popular mayor of the southern port city of Kaohsiung, or billionaire Foxconn chairman Terry Gou Tai-ming. Most public opinion polls have shown Han ahead of all the presidential hopefuls. But the DPP primary surveys put Tsai in front, with support for Han at just 24.51 per cent, 10 percentage points behind Tsai. The surveys also show Tsai ahead of Taipei mayor Ko Wen-je on 22.7 per cent. The independent Ko has been seen as a wild card in next year's poll, given the general support for him from young voters in Taiwan. ^ top ^

US Senator Marco Rubio queries MSCI over inclusion of Chinese shares in major benchmark (SCMP)
2019-06-14
US Senator Marco Rubio has written to the CEO of global index provider MSCI Inc seeking information on why the company has included certain Chinese stocks in its widely tracked emerging market index, his office said on Thursday. The letter forms part of a broader push by Rubio and other Washington lawmakers to crack down on Chinese companies operating in the US equities markets amid a broader trade war with China. US investors are exposed to Chinese companies if they are listed in the United States or included in major benchmarks. "We can no longer allow China's authoritarian government to reap the rewards of American and international capital markets while Chinese companies avoid financial disclosure and basic transparency, and place US investors and pensioners at risk," Rubio told MSCI's chairman and chief executive, Henry Fernandez, in the letter dated June 12. A spokeswoman for MSCI did not immediately respond to a request for comment. In 2017 MSCI said it would for the first time include stocks listed in Shanghai and Shenzhen in its global emerging market benchmark, a move that will ultimately bring billions of global investment dollars into the mainland Chinese stock markets. In February, the company said it would quadruple Chinese' firms weighting in the index and add some mid-cap stocks. Rubio, a Republican, raised concerns that the move could expose US investors to companies with poor corporate governance and a track record of fraud. He also questioned the decision at a time when the United States is fighting China over trade policies he said are designed to undermine the US economy and hurt workers. "What MSCI is doing is allowing the Chinese Communist Party controlled market … to access a critical source of capital and clothe itself in a facade of legitimacy." MSCI conducted a multi-year consultation with global investors during which the index firm secured many key changes to the Chinese market before deciding to include mainland shares. Many investors said the move was long overdue because China was dramatically underweighted in the emerging market benchmark relative to the country's share of the global economy. ^ top ^

Rare-earth exports fall 16% in May (China Daily)
2019-06-11
China, the world's largest producer of rare earths, saw a 16 percent monthly drop in those exports in May amid an increased focus on domestic resources conservation and high-quality development of commodities, officials and experts said. Rare-earth exports by China fell to 3,640 metric tons in May from 4,329 tons in April, according to the General Administration of Customs. In the first five months, China exported 19,266.8 tons of rare earths, down 7.2 percent year-on-year. "The drop of China's rare-earth exports is the result of domestic resource conservation and environmental protection, and it is in line with the country's need for promoting high-quality development," said Cui Fan, a professor at the University of International Business and Economics. Cui said escalating trade tensions between China and the United States have also exerted a negative impact on global supply chains, especially in commodity goods such as crude oil, soybeans and rare earths. "Many markets' heavy dependence on Chinese supply has exhausted mines at home and caused environmental impacts. It is time for them to increase supplies from other producers such as Russia, Greenland and certain African nations to meet their demand," Cui added. Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation, said China has developed advanced separation and purification methods for rare-earth elements with high efficiency and low cost. "To better exploit strategic rare-earth resources, China needs to continuously focus on adding value by making technologically advanced products rather than simply exporting the raw materials," Mei added. "China needs to consolidate its leading role in advanced separation and purification methods. What's more, China also needs to accelerate the push for developing intensive rare-earth processing." Rare earths, a group of 17 elements, is used in production in a huge number of sectors, ranging from high-tech consumer electronics to military equipment. China produces around 80 percent of the world's supply of rare earths. However, the country's rare-earth industry faces problems such as smuggling, illegal mining and production, lack of innovation and environmental protection issues. "The government continues to regulate the rare-earth industry by setting up environmental standards to make exploration and refining processes cleaner," said Zhu Yi, a senior metals and mining analyst at Bloomberg Intelligence. "This also complies with the government's decision to reduce pollution in the metal industry." China launched a strict environmental protection policy in 2013 and tied emission reductions to local governments' performance measurements, Zhu said. Producers that cannot meet emission targets are forced to shut down or upgrade production lines. The National Development and Reform Commission recently held three seminars with industry experts, key enterprises and local government officials to discuss the country's efforts to better utilize the rare-earth resources, improve industrial structure, protect resources and foster high-quality development in the sector. The NDRC said more efforts are needed to improve management of the rare-earth market, rectify market order, foster a better business environment, make breakthroughs in key technologies, crack down on violations of laws and regulations and promote a green, sustainable future. ^ top ^

Why Asean nations are reluctant to put pressure on North Korea over weapons programmes (SCMP)
2019-06-12
In the year since the historic first US-North Korea nuclear summit in Singapore, Asean countries have become unwilling to get tough on North Korea, with some eyeing economic benefits from Pyongyang in the future. The 10 member states of the Association of Southeast Asian Nations have been trying to improve ties with North Korea, as the possibility has waned that Pyongyang will be engaged in a military conflict with Washington, jeopardising regional stability. A few companies in Asean, meanwhile, are paying close attention to North Korea's economic potential and they have exported goods to the Northeast Asian country to deepen ties with Pyongyang, even though such a move violates UN Security Council sanctions resolutions. At their summit in Singapore on June 12 last year, US President Donald Trump and North Korean leader Kim Jong-un agreed that Washington would provide security guarantees to Pyongyang in return for "complete denuclearisation" of the Korean peninsula. But the two leaders fell short of a deal at their February 27-28 second summit in the Vietnamese capital Hanoi against a backdrop of the gap between Washington's insistence on denuclearisation and Pyongyang's demand for sanctions relief. As denuclearisation negotiations have been at a standstill, North Korea has resumed provocative actions against the US, such as firing projectiles that appeared to be short-range ballistic missiles in early May. Nevertheless, Trump, who some analysts say wants to be able to tout results during his re-election campaign next year, continues to take a conciliatory approach toward North Korea, voicing hope to continue talks with Kim. Pyongyang also seems to be reluctant to break off talks with Washington to achieve its ultimate goals of obtaining security guarantees from the US and revitalising North Korea's stagnant economy. "After Trump and Kim met in Singapore, they have said that their personal relations remain good. We don't expect that military tensions between the United States and North Korea will grow," a diplomat in Beijing from one of the Asean nations said. "North Korea's missiles and nuclear weapons are not a threat to us. What we are concerned about is whether a US-North Korea clash would threaten security in our region. "If the possibility is remote, there is no reason for us to take a hardline approach that would hurt relations with North Korea. Asean member states are seeking stable and neutral ties with the two Koreas." Shawn Ho, an associate research fellow at the S. Rajaratnam School of International Studies, echoed the view, saying: "Asean member states believe it is important to remain neutral in their respective foreign policies." Asean comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. All 10 nations have diplomatic ties with North Korea. North Korea's relations with Indonesia and Vietnam sharply worsened in the wake of the murder of Kim Jong-nam, the estranged half-brother of Kim, at Kuala Lumpur International Airport on February 13, 2017. Two women – from Indonesia and Vietnam – had been charged with killing Kim Jong-nam by smearing the highly toxic nerve agent VX on his face at the airport, but they were released earlier this year. Since the case has "more or less been resolved" after the release of the two women, Pyongyang's ties with Jakarta and Hanoi "appear to be back to normal", said Ho, an expert of the Korean peninsula at the think tank in Singapore. Relations between North Korea and Malaysia also deteriorated following the apparent assassination by Pyongyang. Kuala Lumpur expelled the North Korean ambassador to Malaysia, bringing down the curtain on over 40 years of cosy ties. Malaysian Prime Minister Mahathir Mohamad, however, has expressed readiness to mend relations with North Korea recently. "Some business people from various Asean member states are interested to explore business opportunities in the DPRK," Ho said, using the acronym for North Korea's formal name, the Democratic People's Republic of Korea. "At the moment, not much business can be done due to the sanctions." Asean sources said there are enterprises in Southeastern Asia that have exported goods to North Korea in defiance of UN Security Council resolutions. "While we are making every effort to crack down on transactions against the resolutions, unfortunately we cannot say that no company in the Asean region is involved in business with North Korea," one of the sources said. Citing a UN Panel of Exports report, the source also said that Singapore-based company T Specialist International and its partner firm OCN are alleged to have exported luxury goods to North Korea in the past few years. Japan – North Korea's neighbour that is seriously worried about its nuclear and missile blackmail – has pursued the full implementation of international economic sanctions to force Pyongyang to discard its weapons of mass destruction programmes. "We should cooperate with Asean countries to address North Korea," a Japanese government official said. ^ top ^

North Korean leader Kim Jong-un's slain half-brother Kim Jong-nam 'was a CIA informant', and 'almost certainly' in contact with China (SCMP)
2019-06-11
North Korean leader Kim Jong-un's half-brother Kim Jong-nam, who was killed in Malaysia in 2017, had been an informant for the US Central Intelligence Agency, The Wall Street Journal reported on Monday. The Journal cited an unnamed "person knowledgeable about the matter" for the report, and said many details of Kim Jong-nam's relationship with the CIA remained unclear. Reuters could not independently confirm the story. The CIA declined to comment. The Journal quoted the person as saying "there was a nexus" between the CIA and Kim Jong-nam. "Several former US officials said the half-brother, who had lived outside North Korea for many years and had no known power base in Pyongyang, was unlikely to be able to provide details of the secretive country's inner workings," the Journal said. The former officials also said Kim Jong-nam had been almost certainly in contact with security services of other countries, particularly China's, the Journal said. South Korean and US officials have said the North Korean authorities had ordered the assassination of Kim Jong-nam, who had been critical of his family's dynastic rule. Pyongyang has denied the allegation. Two women were charged with poisoning Kim Jong-nam by smearing his face with liquid VX, a banned chemical weapon, at Kuala Lumpur airport in February 2017. Malaysia released Doan Thi Huong, who is Vietnamese, in May, and Indonesian Siti Aisyah in March. According to the Journal, the person said Kim Jong-nam had travelled to Malaysia in February 2017 to meet his CIA contact, although that may not have been the sole purpose of the trip. US President Donald Trump and Kim Jong-un have met twice, in Hanoi in February and Singapore last June, seeming to build personal goodwill but failing to agree on a deal to lift US sanctions in exchange for North Korea abandoning its nuclear and missile programmes. ^ top ^

Cooperation documents signed during the visit of President Kh.Battulga (Montsame)
2019-06-13
Following their official talks, President of Mongolia Kh.Battulga and President of the Kyrgyz Republic S.Sh.Jeenbekov witnessed the signing of some official documents. The Presidents briefed the media after the signing ceremony. President of the Kyrgyz Republic S.Sh.Jeenbekov said "At the official talks, the sides agreed to pay attention on trade, economic and cultural cooperation, for which I hope that the Third Mongolia-Kyrgyzstan Intergovernmental Commission Meeting would bring adequate outcome. Moreover, we discussed regional cooperation matters and put a basis to develop this issue. Most importantly, both countries are interested in developing mutually beneficial cooperation. The Kyrgyz side is delighted with the official visit of the Mongolian President. I believe that our talks would make huge contribution to bilateral ties." For his part, President Kh.Battulga said, "President S.Sh.Jeenbekov and I spoke about expanding bilateral relations in broader field such as politics, security, defense, economy, trade, agriculture, tourism, education, culture and sports while maintaining close cooperation in regional and international arena. Within the framework of the official visit, the sides established cooperation documents including Intergovernmental Agreements on Cooperation in Military Sector and Counter-terrorism, Protocol on Cooperation between the National Security Councils of the two countries and cooperation documents in the spheres of education, tourism, intellectual property, archives and research with a purpose to strengthen the legal environment for bilateral relations. I hope that there will be tangible achievements in these areas of cooperation." Furthermore, the sides affirmed that opening the Embassy of Mongolia as part of the official visit denotes Mongolia's attaching great significance to its relations and cooperation with Kyrgyzstan. ^ top ^

Global brands and manufacturers show interest in Mongolian cashmere (Montsame)
2019-06-13
Large scale international brands, such as Gucci, H&M and UNIQLO, have expressed their readiness to partner if cashmere is prepared in an environmentally friendly and sustainable way in Mongolia. The statement was made by representatives of the aforementioned companies during the conference that was jointly organized by the UNDP and the Ministry of Food, Agriculture and Light Industry under the theme, 'Multi-Stakeholder Collaboration for Systemic Change: The Case of Sustainable Cashmere in Mongolia' on June 12. The discussion was held in aims of developing environmentally friendly cashmere production and supporting the initiative in Mongolia. In her opening speech, UNDP Resident Representative Ms. Beate Trankmann highlighted that companies are against wholesale production of cashmere, and have begun to consider the environment, livestock and livelihoods of cashmere producers comprehensively, and noted that Mongolia has the opportunity to promote the value of traditional animal husbandry—livestock herding that is close to nature. Representative of H&M Asia Sherry Gu said, "Some large scale international brands have recently begun to stop production that is not environmentally friendly and violates animal rights. However, this does not mean that cashmere products will come to a complete halt. We are ready to purchase cashmere at a high price from Mongolia if it is prepared in a sustainable way, such as being environmentally friendly, and taken from healthy livestock without child labor." Head of the UNDP Green Commodities Programme Andrew Bovarnick said, "The reason we gathered here today is to create a partnership platform for the government, private entities, domestic companies and herders. There is an opportunity for domestic manufacturers to put their products on the global market and make profit. In order to do this, we must work together." The conference was attended by representatives of UNDP Green Commodities Programme, Mongolian Wool and Cashmere Association, AVSF, Sustainable Fibre Alliance, Textile Exchange, the global luxury group Kering and research institutes. Mongolia produces 40 percent of the global cashmere. As a result of the Cashmere programme being implemented by the government, 1,570 job opportunities were created, with sales reaching MNT 1.3 trillion in 2018. ^ top ^

Jennia Jin
Embassy of Switzerland