In the loop = August 23, 2019

Nikkei: Chinese mobile carriers eye sharing 5G networks to curb costs

Despite government hype, state-owned carriers are reluctant to take the plunge.

Expat Chinese embrace freedom—marching against Hong Kong protests: WSJ reports, Hong Kong’s summer of political unrest is going global. In countries like the US, Canada, Australia, and the UK, the sometimes aggressive tactics of Chinese demonstrators rallying to support Beijing risk a backlash in the West.

YouTube disables 210 channels that spread disinformation about Hong Kong protests.

Hong Kong’s ‘Gang of Four’ hit back at Beijing: FT reports, veteran pro-democracy campaigners targeted by China deny accusations of leading protests.

Pupils swell ranks of Hong Kong protesters: The Times reports, hundreds of schoolchildren gathered in a Hong Kong square to demand political reforms, as the teenagers became a new and potent force in the territory’s massive pro-democracy movement. Wearing black and holding umbrellas, the students endured sweltering heat for a demonstration in Edinburgh Place today, where they held up posters denouncing police brutality.

Banks call for order in Hong Kong as jewelers warn of trade fair dud: Reuters reports, Hong Kong banks published full-page newspaper ads calling for law and order in the Chinese-ruled city and international jewelers sought the rescheduling of a huge trade fair as weeks of pro-democracy protests showed no sign of let-up on Thursday.

US and ASEAN to hold first joint naval drills near South China Sea: Nikkei reports, Southeast Asian bloc walks tightrope between Washington and Beijing.

In the loop = August 22, 2019

Hong Kong billionaire gives Xi powerful advice in cryptic ad: Nikkei reports, don't over pick the melons, Li Ka-shing cautions, citing Tang dynasty poem.

China wages digital war over Hong Kong: The Times reports, Beijing has begun a calculated cyber campaign to undermine and discredit the protesters.

As protests ebb and flow, Hong Kong activists bank on creativity: AFP reports, notifications for the "War Room" WhatsApp group ping relentlessly as an organiser of Hong Kong's biggest political rallies in decades explains the challenge of keeping an exhausted, battle-weary protest movement on the streets.

Alexander Görlach: Another Tiananmen Square in Hong Kong?The protests in Hong Kong are increasingly becoming a thorn in Beijing's side. How much longer will the Communist Party leadership sit back and watch? Don't count out China making a rash decision.

Nikkei: Beijing's political reach casts shadow over Hong Kong business

Alibaba has postponed plans for a multibillion-dollar share listing in Hong Kong.

Chinese hackers target US cancer institutes: report: Nikkei reports, Beijing strives for edge in cancer research, California-based cybersecurity company FireEye says.

Nearly 28% of all deaths in China were cancer related, according to the World Atlas data site.

AFP: Beijing hits back after Trudeau vows to stand up to China

James Kynge: Righteous anger from the US will not win the tech war with China
: Washington’s tech sanctions will not halt Beijing’s industrial advance.

South Korea ends pact to share military information with Japan: WSJ reports, South Korea said it would withdraw from a pact with Japan to share classified military intelligence, weakening the US alliance network in East Asia and exacerbating tensions that have flared between Seoul and Tokyo in recent weeks over trade and wartime history.

Nikkei: South Korea pulls out of intelligence sharing pact with Japan

Move is an escalation of dispute between neighbors over trade and history.

In blow to US security interests, South Korea axes pact to share intelligence with Japan: WP reports, the United States had urged the allies to settle their differences, with Secretary of State Mike Pompeo stressing their “incredibly important” cooperation on North Korea.

Takashi Shiraishi: Growing Asian economies breed high expectations among citizens: Governments must handle slowdown carefully to avoid rise of populism.

CNBC: Mike Pompeo tells business execs, economists that he thinks the China trade war could end by 2020 election

US-China trade war hits Bunge spending plans
: FT reports, the chief executive says global agricultural trader to pull back on pace of investments.

Investors pull $2.9bn from funds investing in China.

Outflows rise amid concerns about Chinese economic growth and trade war with US.


David Von Drehle: Xi’s choice: Destroy Trump, or save him and weaken America https://wapo.st/2Z3kW0u

China resists charge by Twitter, Facebook of disinformation effort: WSJ reports, China’s government pushed back against moves by Twitter and Facebook to curb accounts the companies said were part of a state-sponsored disinformation campaign against Hong Kong protesters.

NYT: China acknowledges holding an employee of UK’s Hong Kong consulate

Reuters: Hong Kong protest moves to mob-attack subway as bank warns of economic fallout


John Gapper: Business in Hong Kong needs to stay strong: Beijing wants to make companies impose obedience to China on protesting employees.

Pentagon warns of China’s growing influence in the Middle East: FT reports, top official cites fears that Beijing could leverage economic ties and steal sensitive technology.

Bloomberg: Qatar withdraws support for China over its treatment of Muslims

Qatar withdrew its signature from a letter signed by dozens of countries in support of China’s human-rights record despite international condemnation over its detention of as many as two million ethnic Muslim Uighurs.

China threatens sanctions on US firms linked to Taiwan warplanes sale: AFP reports, China on Wednesday blasted a huge planned US arms shipment to self-ruled Taiwan and threatened to sanction firms involved in the sale of F-16 fighter jets. The US State Department on Tuesday approved the transfer of 66 Lockheed Martin-built F-16 fighter jets to Taiwan in a US$8 billion deal, following another huge military hardware sale agreed just last month. The deals come as ties between Washington and Beijing are already strained by a punitive multi-billion dollar trade war.

Nina Xiang: US is mistakenly making policy based on fear of China's tech abilities: High-tech industries are likely to miss Made in China 2025 targets.

In the loop = August 20, 2019

Nikkei: China seeks to flip nations in Pacific Great Game with US

Taiwan ties and geography give small islands big significance.

Employee of UK Consulate in Hong Kong detained in China: WSJ reports, a member of the British consular staff in Hong Kong has been detained in mainland China after a trip to the neighboring city of Shenzhen.

The Times: Hong Kong consulate official Simon Cheng Man-kit ‘detained by China’

‘Protesters vs. police’: HK die-hards defend their stance: AP reports, to Lam, these are “violent rioters” bent on destroying the city’s economy. To China’s ruling Communist Party, their actions are “the first signs of terrorism.” To these most die-hard protesters, there’s no turning back.

Facebook and Twitter and Hong Kong: Both announced they had removed social-media accounts based in Mainland China that were attempting to undermine the massive pro-democracy protests in the country.

Twitter and Facebook remove China-backed disinformation on Hong Kong: Nikkei reports, Mainland bans the social media platforms but allegedly uses them to sow discord.

AFP: Hong Kong's Lam promises to 'immediately' start peace dialogue

Nikkei: China expands Shanghai free trade zone to pull in investment


Tesla to set up second 'gigafactory,' despite US trade war uncertainty.

Today: The World Robot Conference opens at the Beijing Etrong International Exhibition and Convention Center

Jason Furman: Trump is losing the trade war with China: The markets doubt tariffs will bring about any major concessions. The US needs a multilateral approach.

Tyler Cowen: What if everyone’s wrong about China? Most predictions about its future fail to account for the human capacity to shape events.

In the loop = August 19, 2019

Nikkei: China seeks to mediate in Japan-South Korea trade spat

Foreign ministers of three nations will meet in Beijing on Wednesday.

The Times: Trump’s trade war sends Chinese students to British universities

Some 7,740 Chinese students are due to arrive on campuses across the UK, up from 5,930 last year and 3,480 a decade ago. More than 363,000 Chinese students attended US universities in the 2017-18 academic year but the number of new students enrolling this autumn is expected to fall.

The quantum revolution is coming, and Chinese scientists are at the forefront: WP reports, China’s formidable investment in quantum technology, which could transform information processing and confer big economic and national-security advantages to nations that dominate it, is helping it catch up with Western research and, in a few areas, pull ahead.

FT: Hong Kong protesters rally in defiance of Beijing

Fresh demonstrations held in spite of paramilitary police massing across the border.

Organizers estimated that 1.7m people attended the protest, but numbers were difficult to estimate as participants flowed into nearby roads and streets without passing through the designated park area. The police estimated that at its peak 128,000 gathered in the designated protest zone.


Trump cautions China on Hong Kong, dismisses recession fears: WSJ reports, Trump warned Chinese President Xi Jinping against reacting violently to protests in Hong Kong saying that could threaten a trade deal.

Donald Trump: Hong Kong crackdown would hurt China trade deal: DW reports, the US president has said that he'd "like to see Hong Kong worked out in a very humanitarian fashion." Trump warned that a Tiananmen Square-style crackdown would damage talks on a US-China trade deal.

Bloomberg: Trump says US is talking with China but not ready for a deal

@AFP #BREAKING US gives Huawei 90 day reprieve on ban

With troop buildup, China sends a stark warning to Hong Kong: NYT reports, by massing troops within view of the city, which has been convulsed by protests, China delivered a strong message that the use of force remained an option.

China pressures businesses over support in Hong Kong: NYT reports, businesses are falling in line to back China amid the city’s protests — and their employees are caught in the crossfire.

China works to turn Shenzhen into the new Hong Kong: Nikkei reports, new infrastructure and reforms would help city replace island as investment hub.

AFP: China plans to make Shenzhen a 'better place' than Hong Kong

White House pushes ahead with $8bn arms sale to Taiwan
: FT reports, Trump administration builds bipartisan backing for prospective deal.

China's version of GPS now has more satellites than US original: Nikkei reports, growing global coverage of BeiDou positioning system raises security fears.

In the loop = August 16, 2019

AP: China threatens retaliation if US tariff hikes go ahead

Shawn Tully: Trump thinks he is winning the trade war. The data tell a different story http://bit.ly/2YSWU8b

Chinese amass troops in stadium near Hong Kong: FT reports, thousands of paramilitary police gather in stadium on border with territory.

Inside China's global entertainment ambitions -- and what might get in the way: Variety reports, the numbers always dazzle in China. The country has more than 60,000 movie screens, the most of any nation on Earth, almost all built within the last 10 years. It boasts more paid subscribers to streaming-video services than the rest of the globe combined, and Netflix doesn't even operate there.

Taiwan sharply boosts defense budget amid China tension: Reuters reports, Taiwan unveiled its largest defense spending increase in more than a decade on Thursday amid rising military tensions with its giant neighbor China, which considers the self-ruled island its own and has not renounced the use of force against it.

North Korea insists that talks with South Korea are over, and launched two short-range ballistic missiles this morning.

Japan largest US creditor: Japan has again surpassed China as America's largest overseas creditor, a record it last held in 2016. After adding about $21B since May, Tokyo now holds $1.12T of Treasurys vs. Beijing's $1.11T. Japan has again surpassed China as America's largest overseas creditor, a record it last held in 2016. After adding about $21B since May, Tokyo now holds $1.12T of Treasurys vs. Beijing's $1.11T.

In the loop = August 15, 2019

China curbs gold imports as trade war heats up: Reuters reports, China has severely restricted imports of gold since May, according to bullion industry sources, in a move that could be aimed at curbing outflows of dollars and bolstering its yuan currency as economic growth slows.

Trump tells China to address Hong Kong protests before talking trade: DW reports, Trump has suggested China resolve ongoing tension with Hong Kong before hashing out a trade deal with the US. The remarks follow his decision earlier this week to postpone imposing further tariffs on Beijing.

Trump ties trade deal to China action in Hong Kong: WSJ reports, Trump suggested a “personal meeting” with China’s President Xi Jinping to discuss the escalating crisis in Hong Kong and warned China it must respond “humanely” to the protests if it wants to strike a trade deal.

Trump resists aides’ pressure to back Hong Kong protesters: Politico reports, the president is singularly focused on cutting a trade deal with Xi Jinping, officials say.

US lawmakers urge support for Hong Kong protests: FT reports, Trump has so far avoided publicly criticizing China as crackdown fears grow.

West reluctant to criticize China over Hong Kong stance: DW reports, clashes in Hong Kong have grown more violent and Beijing has ramped up its intimidation tactics as protests enter their 11th week. But so far, the West has shied away from openly chiding China.

Reuters: Hong Kong braces for more protests as world leaders urge calm, talks

@ForeignAffairs: “Xi has harshly suppressed internal dissent, executed a sweeping anticorruption campaign, and adopted a bold, expansive foreign policy that has directly challenged the United States. Few foresaw the extent of Xi’s ambition before he took over as leader.”

NYT - Editorial: Hong Kong’s challenge to Xi Jinping’s iron rule: The protesters, for the most part, are not terrorists or even radicals. But they are a threat to his monopoly on power.

FT - Editorial: A military crackdown in Hong Kong would be a tragic error: Armed intervention would harm China’s long-term economic interests.

Daniel Henninger: Does Hong Kong matter? Trump should know better than anyone that these protests in Hong Kong are about freedom.

'Made in China' at risk as workers flock to service sector: Nikkei reports, the once mighty manufacturing industry struggles to compete in wages.

The world’s gadget makers are splitting along US-Chinese lines: Bloomberg reports, electronics makers are increasingly moving to get out of the way of Trump's tariffs.

In the loop = August 14, 2019

As ‘America First’ erodes US influence, crises in Asia escalate: NYT reports, Trump has taken a hands-off approach to conflicts — including Kashmir, Hong Kong and the rivalry between Japan and South Korea. Governments are ignoring the Trump administration’s mild admonitions and calls for calm.

FT: Trump retreat on some tariffs raises scant hopes

Move seen as only temporary reprieve in US-China trade war despite market enthusiasm.

Nikkei: US delays China tariffs on phones and laptops for Christmas season

NY stocks jump on the news, pushing up Apple and Nike shares.

US delays tariffs on key Chinese goods, prompting market surge: DW reports, the US has announced a delay imposing tariffs on certain Chinese products that had been earmarked for the measure from next month. China has said the tariffs were "not a constructive way" to resolve the trade conflict.

Trump finally acknowledges his tariffs could hit consumers: WP reports,with his announcement of a delay in tariffs on Chinese goods, he contradicted his own mantra that the Chinese are paying the full price of his tariffs.

@CNBCnow: BREAKING: USTR removes items from upcoming China tariffs due to 'health, safety, national security' factors and delays until Dec 15 tariffs on cell phones, laptops, video game consoles, certain toys, computer monitors & some items of footwear/clothing

@niubi: Remarkable cave by trump on his tariff threat from early August. The message to Beijing is trump can’t hold firm because of worries voters may get unhappy with more expensive holiday goods. So why would beijing make concessions?


WSJ: Hong Kong tightens airport security after days of protests

Hong Kong protesters apologize after chaos grips airport
: NYT reports, demonstrators promised to do better, and the airport said it would limit terminal access to passengers and workers.

Hong Kong protesters apologize, face tipping point after demonstrations at airport turned violent: WP reports, protesters sought sympathy and forgiveness as they fought to regain control over a narrative that seemed to be tilting in Beijing’s favor for the first time.

The Times: Hong Kong protesters are terrorists, says Beijing after Chinese men detained

LAT: Satellite photos appear to show Chinese armored vehicles near Hong Kong


NYT: ‘Hong Kong thing’ is ‘very tough,’ but Trump doesn’t criticize China

Catherine Philp: Hong Kong protests: Fears of another Tiananmen Square are no longer absurd

Jamil Anderlini: Hong Kong’s future hangs by a thread
: It has become an obstacle to Xi Jinping’s vision of a ‘great rejuvenation’ of China.

Thomas L. Friedman: Trump and Xi sittin’ in a tree: Both men have overplayed their hand and are desperate to be seen as the winner in their trade war. https://nyti.ms/2YNDBwZ

Americans’ view of China sours as trade war rages: FT reports, the survey shows 24% view Beijing as ‘greatest threat’ to US in the future, on a par with Russia.

A Pew Research Center poll conducted between mid-May and mid-June, after the acrimonious breakdown of trade negotiations between the senior US and Chinese officials, found that 60 percent of Americans have an “unfavorable” view of China, compared with just 26 percent who held a positive view.

This marked a sharp increase in Americans who view China in a negative light compared with 2018, when 47 percent of the US public said they had an unfavorable view of China, and the highest level of unfavorability since the Pew series began in 2005.

In the loop = August 13, 2019

WP: Hong Kong airport cancels flights for second day as protesters reoccupy terminal

Hong Kong airport faces second day of disruption
: WSJ reports, protesters swamped Hong Kong International Airport for a second straight day, blocking the gates to the security and immigration areas and snarling the busy transit hub.

Protests disrupt Hong Kong airport for second day: NYT reports, Hong Kong’s airport suspended check-ins as peaceful protesters disrupted its operations for a second day. The demonstration came hours after the city’s embattled leader pleaded for order following days of escalating chaos and violent street clashes.

FT: Anti-government protesters flood back into Hong Kong airport

Action prompts territory’s largest carrier to issue warning on non-essential travel.

The Times: Don’t plunge Hong Kong into abyss, Carrie Lam warns protesters

Protests put Hong Kong on collision course with China’s Communist Party
: NYT reports, the grand political experiment to marry Beijing’s brand of authoritarianism with a bastion of civil liberties appears to be facing a moment of reckoning.

Bloomberg: Trump is making Xi’s superpower 2050 plan tougher by the day

Chinese president wants to achieve great power status by 2050.

Risk of falling into a ‘middle income trap’ is growing.


Reuters: Yuan at right level, disorderly capital flows unlikely - China central bank official

The South Korean won continues to weaken against the dollar.

Rupakjyoti Borah: India responds to Belt and Road Initiative with an infrastructure push

New Delhi does not want China to dominate its backyard so has started spending.

How far will China go to support Pakistan's position on Kashmir?: DW reports, both India and Pakistan are vying for China's support in the dispute over Kashmir. Experts say that although China is critical of India's move to control the region, it's unlikely to affect economic ties with India.