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PODCAST | China Money Podcast: Health Technology And Artificial Intelligence Startups Raise Big VC Rounds This Week –

PODCAST | China Money Podcast: Health Technology And Artificial Intelligence Startups Raise Big VC Rounds This Week – | NEWS |

In this episode of China Money Podcast, listen to all the news headlines in the China venture investment and tech sector for the week ending June04.

Deal flow was on the low side in China this week with only 63 documented fundraise closings, but we still saw some mega fundings, such as the US$200 million Series B for a Shanghai-based healthcare company and a US$190 million Series D closing for an 8-year-old artificial intelligence firm. Investors in key deals this week include China Merchants Venture, Sequoia Capital China, Greenwoods Investment, WuXi AppTec, N5 Capital, Matrix Partners China, Legend Capital, and Chenhui Venture Partners. 

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Chart of the Day: Hong Kong’s Yuan Deposits Grow on Appreciation-Induced Attraction

Chart of the Day: Hong Kong’s Yuan Deposits Grow on Appreciation-Induced Attraction | NEWS |

Yuan deposits in Hong Kong rose to the second-highest level in about five years in April, boosted by the currency’s appreciation against the U.S. dollar and the growing internationalization of the yuan.

The deposits denominated in the yuan in Hong Kong, a major offshore market for the Chinese currency also known as the renminbi, rose to 782 billion yuan ($122.6 billion) at the end of April, the second-highest level since February 2016 after January’s 798 billion yuan, according to data released Monday by the Hong Kong Monetary Authority, the city’s de facto central bank.

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VIDEO | Expecting China to Completely Reverse Its Family Planning Policy

VIDEO | Expecting China to Completely Reverse Its Family Planning Policy | NEWS |

"Just relaxing the restriction on the number of children will not be enough," says Chairman James Liang, who wrote a book on demographics and innovation. "We are expecting China to completely reverse its family planning policy, to start rolling out generous support program in the future," says Liang.

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VIDEO | Biden’s China Blacklist a Bad Decision

VIDEO | Biden’s China Blacklist a Bad Decision | NEWS |

Henry Wang, founder and president of Center for China and Globalization, discusses China’s response to President Biden’s order amending a ban on U.S. investments in Chinese companies, U.S.-China relations and the investigation into the origins of Covid-19 brought on by the Biden administration.

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Misguiding U.S. reports on COVID-19 origin sourcing hurt U.S. credibility - People's Daily 

Misguiding U.S. reports on COVID-19 origin sourcing hurt U.S. credibility - People's Daily  | NEWS |

People's Daily

Zhong Sheng (Zhong Sheng is a pen name often used by People's Daily to express its views on foreign policy.) 

The so-called "lab leak theory" recently fabricated by the U.S. is just lame. It followed the same old trick in which certain media outlets published biased reports and then some politicians hyped them up.

The so-called "lab leak theory" has already been denied by scientific researches. Does the Wall Street Journal really believe that an intelligence report of unknown origin could overturn scientific studies? Where did it get this "previously undisclosed U.S. intelligence report?" Is the report "exclusive" or "tailored?" Has the Wall Street Journal verified it?

Since the outbreak of COVID-19, some U.S. politicians have deliberately politicized the virus while some American media organizations "held a candle to the devil."

In April last year, the Washington Post fabricated a story that the novel coronavirus came from a Chinese lab, and it was followed by a February report by the New York Times which said Chinese scientists refused to share raw data that might bring the world closer to understanding the origins of the coronavirus pandemic.

These American media organizations turned a blind eye to science and facts, and repeated their lies again and again, which not only is a violation of professional ethics, but also undermines the atmosphere for international anti-pandemic cooperation that is in urgent need today.

The U.S. politicians and media organizations are working hand in glove with each other to spread rumors and stigmatize China because they can't accept a growing China. Obsessed with zero-sum mentality and fanning confrontation, they are addicted to Cold War solutions such as information and public opinion warfare. By spending huge amount of money each year to “counter the malign influence of China”, the U.S. politicians just want to keep slandering China with rumors and lies. Such bold actions once again showed the American hegemony to the world.

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Mario Draghi sets tone in cooling EU-China relations

Mario Draghi sets tone in cooling EU-China relations | NEWS |

In 2019, Rome stunned its US and European allies when Italy’s then populist coalition government became the first G7 member to sign up to China’s Belt and Road Initiative. Signed during a state visit by Chinese president Xi Jinping, the agreement propelled Italy to the frontline of Beijing’s battle for global power and influence.

But then, two years later, Italy’s newly appointed prime minister Mario Draghi quietly signed a decree that symbolically ended China’s Italian courtship and contained Beijing’s beachhead in western Europe.

Italy’s last government had already begun to cool on Chinese investment amid significant US pressure. Even so, Draghi’s move marked a decisive Italian shift towards a foreign policy he has described as “strongly pro-European and Atlanticist, in line with Italy’s historical anchors”.

It also presaged a broader EU rethink of Chinese relations that, most recently, has led to the European parliament freezing its pending trade deal with Beijing.

“To make it look like Italy is aligned with the US, sometimes you need to do little things to prove it,” said Michele Geraci, a China expert who, as undersecretary for economic development, was one of the architects of Italy’s Belt and Road agreement with Beijing.

It was “a political statement to show we are worried about predatory acquisitions, and that we are aligned with our American friends”, Geraci added. Italy’s participation in China’s BRI remains technically in force but has been rendered essentially meaningless and no major deals have taken place.

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US gives Covid vaccines to Taiwan after China accused of interference

US gives Covid vaccines to Taiwan after China accused of interference | NEWS |

The US will donate 750,000 Covid-19 vaccines to Taiwan, signalling its support for the country after Taipei accused Beijing of interfering in its efforts to secure jabs.

The announcement by a group of US senators during a high-profile visit to Taipei on Sunday came just days after Japan donated 1.2m jabs as Taiwan grapples with its first large-scale Covid outbreak.
The US contribution to Taiwan accounts for more than 10 per cent of the 7m vaccine doses Washington has pledged to give to Asian and Pacific nations.

“It was critical to the United States that Taiwan be included in the first group to receive vaccines because we recognise your urgent need and we value this partnership,” said Tammy Duckworth, a US senator.

Duckworth and two other senators arrived in Taipei on a US Air Force transport aircraft from South Korea, the first US military plane to land in Taiwan since a disaster relief mission following a 1999 earthquake.

Visiting US delegations have avoided using Air Force aircraft ever since Washington switched diplomatic recognition from Taipei to Beijing in 1979. China, which claims Taiwan as part of its territory and threatens to annex it if Taipei refuses to submit under its control indefinitely, sees the presence of any US military assets on the island as a provocation.

“They used an Air Force plane to highlight this mission is supported, endorsed or even co-ordinated with the administration,” said a senior Taiwanese government official. “The US government wants to make sure the people understand the significance of the short visit.”

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Johnson and Biden thrown together by geopolitical necessity 

Johnson and Biden thrown together by geopolitical necessity  | NEWS |

Joe Biden’s first overseas trip as US president this week will include a meeting with Boris Johnson, the British prime minister he memorably described in 2019 as “a physical and emotional clone” of Donald Trump.

Political circumstance and geopolitical necessity have thrown Biden and Johnson together. Ahead of the G7 summit — which Johnson will chair — their relationship is viewed by both sides as being rich in potential but laced with potential danger. Johnson’s first face-to-face meeting with the US president in Cornwall will be a crucial moment for both leaders. One is trying to re-establish American global leadership, the other trying to prove that “Global Britain” is more than a slogan.

On China, Johnson takes a more hawkish stance than most other G7 countries but some believe he could come under pressure from Biden in the coming months to toughen Britain’s stance towards Beijing. Johnson’s recent “integrated review” of foreign and defence policy, with its commitment to pursue “a positive economic relationship, including deeper trade links and more Chinese investment in the UK”, was criticised by hawks in Britain. “I think Boris wants it both ways: to do just enough on China to keep the Americans and the anti-China lobby in his party off his back, while if possible avoiding a deep rift with the Chinese leadership,” Darroch said.

“He will end up closer to Biden on China policy than some Europeans. But he will find it difficult if Biden’s ask of the UK on China goes up significantly. Once upon a time we could hide behind an EU common position. No longer.”

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China tries to get back into the Euro game after ‘yellow card’ for its cooperation platform

China tries to get back into the Euro game after ‘yellow card’ for its cooperation platform | NEWS |

China is expected to adjust its approach towards Europe in an effort to keep its “17+1” platform for engaging with central and eastern European countries on track after one member quit.

Lithuania recently announced its effective withdrawal from the “divisive” body, adding it had not produced the benefits it had expected.

“The departure of Lithuania is a big yellow card for the [17+1] framework, but it is unlikely to be a red one just yet,” Grzegorz Stec, an analyst at the Mercator Institute for China Studies in Berlin, said.

Stec said a chain reaction from the other 16 nations was unlikely, but they would wait to see how Beijing handled Lithuania’s departure and whether it could offer a more attractive proposition.

Some observers said China remained optimistic about cooperation with Europe and was unlikely to try to act tough against Lithuania.

Yu Nanping, a professor of international relations at East China Normal University, said countries such as Poland and Hungary “have emerged in Europe as a new force” that “seek to make a common voice independent of the old Europe”, for example in opposing the European Commission’s policies on immigration.

Yu said Rau’s comments about making the necessary adjustments to the 17+1 framework meant that “those who want to leave the mechanism leave, and those who are willing to stay will cooperate together”.

He continued: “By saying this, Poland wants to highlight its importance in 17+1 and the whole central and eastern Europe region.”

The 17+1 framework, which was established in 2012 and includes both EU and non-EU members, has caused alarm in Brussels, which fears it will undermine the bloc’s unity.

Some members have also echoed Lithuania’s complaints about the slow pace of investment, although Beijing has countered by saying it has increased trade by 85 per cent over the past nine years.

China’s relationship with the EU also suffered a major setback after an investment deal – agreed late last year after seven years of negotiations – was frozen by the European Union Parliament amid growing concern over human rights in Xinjiang.

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Hungary: Plan to build Chinese university branch protested

Hungary: Plan to build Chinese university branch protested | NEWS |

Several thousand people rallied in Hungary’s capital Saturday against plans by Prime Minister Viktor Orban to host a Chinese university in Budapest.

A strategic agreement that Hungary signed with Shanghai-based Fudan University envisages opening a branch in the city’s 9th district. Plans call for the Budapest campus to be completed by 2024. It would enroll international students and represent the school’s only foreign outpost, as well as the first Chinese university campus in the 27-nation European Union.

Budapest authorities have opposed the university branch idea. They argue the $1.9 billion project would place a huge burden on taxpayers and send the wrong political message because of the alleged human rights abuses in China.

Budapest Mayor Gergely Karácsony had a huge photo of a protester facing a tank in Beijing’s Tiananmen Square projected behind him during Saturday’s demonstration. Chinese troops opened fire on protesters in the square on June 4, 1989, killing hundreds and perhaps thousands.

“Let’s make it clear whom we are not protesting against,” Karácsony said. “We have our problem with dictators.... And we are not in the least protesting against Chinese people who live together with us peacefully in this marvelous city.”
Orban, a right-wing populist, has fostered closer ties with Russia and China as he faces European Union criticism for his authoritarian ways and staunch anti-immigration stand.

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Three U.S. senators to visit Taiwan, trip likely to irritate China

Three U.S. senators to visit Taiwan, trip likely to irritate China | NEWS |

Three U.S. senators will visit Taiwan on Sunday and will meet President Tsai Ing-wen to discuss security and other issues, Taiwan's government and the de facto U.S. embassy in Taipei said on Saturday, a trip that will likely irritate China.

The United States, like most countries, has no formal diplomatic ties with the island that is claimed by China, but is its most important international backer and supplier of arms.

Tammy Duckworth and Dan Sullivan of the Senate Armed Services Committee, and Christopher Coons of the Senate Foreign Relations Committee, will visit the island on Sunday as part of a larger trip to to the Indo-Pacific region, the American Institute in Taiwan said.

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EU to China: 'Let's Keep Talking.'

At the heart of Europe’s approach to China is the conviction that continued dialogue with Beijing is essential—no matter how strained the relationship becomes.

A recent example of this was the German government’s decision to go ahead with top-level government consultations with China in April, only weeks after Beijing unleashed a wave of sanctions against European lawmakers, academics, and think tankers. Lately, however, dialogue fatigue has begun to set in—including in Berlin. European officials complain that it has become more and more difficult to have a frank exchange with their Chinese counterparts.

The room to discuss sensitive issues, even behind closed doors, is vanishing. When European officials do raise them, they are often dismissed by their Chinese interlocuters as pawns of the United States.

Make no mistake—this hasn’t broken the commitment to dialogue with China. But after the unravelling of the Comprehensive Agreement on Investment (CAI), it is raising more doubts about whether dialogue can be counted on to deliver results. “Dialogue is now conditional on us not criticizing China,” a senior German official told me. “We can’t even have a rational conversation about the sanctions.”

Wolfgang Ischinger, who as chairman of the Munich Security Conference (MSC) has come to personify this dialogue-first approach, made an earnest attempt last week to demonstrate it still works. He invited China’s Foreign Minister Wang Yi and two European figures who are not known for being especially critical of China—Sigmar Gabriel and Federica Mogherini—to discuss all the thorny issues in the relationship in a public setting.

Instead of a conversation, however, Wang delivered a half-hour lecture to his European hosts, explaining to them all that China was doing right and they were doing wrong. At the end of the monologue, an exasperated Mogherini said she feared the space for mutual understanding and cooperation between the EU and China was “slipping away.”

Apart from the climate change issue—an area that may soon be more about competition than cooperation—it is starting to look that way.

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Chinese Factories Delay New Orders as Costs Rise, Risking Global Supply Shortages

Chinese Factories Delay New Orders as Costs Rise, Risking Global Supply Shortages | NEWS |

Buffeted by rising costs, some Chinese manufacturers are refusing to accept new orders or are even considering shutting down operations temporarily—moves that could put more strain on global supply chains and cause more inflation.

Surging raw-material prices and a shortage of workers have pinched smaller Chinese manufacturers, including many that sell their products to the U.S. and other Western markets. While many have passed their higher costs on to overseas buyers, the pain is so severe at some manufacturers that they are finding it hard to raise prices enough to make up the difference. Others don’t want to risk losing business to competitors. Many are now looking for other solutions to avoid losing money.

 The hope among many manufacturers is that if they delay orders or slow production, they will be able to ride out the present period of higher costs without major losses until commodity prices normalize or global demand for consumer goods cools. Orders for everything from bicycles to laptops have soared, as Western consumers spend stimulus checks and savings built up during the pandemic, which has heaped pressure on global supply chains and helped to push raw-material prices higher.

But the strategy could fail if prices of raw materials continue to climb, or if Western demand doesn’t cool. In that scenario, factories that curb production would just be creating more goods shortages that in turn could lead to more cost pressures.

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A tough road ahead for US on forced labour 

A tough road ahead for US on forced labour  | NEWS |

We know very little about the Biden administration’s trade policy towards China at the moment, but last Friday we were given a strong signal that it’s making combating forced labour a priority — maybe even over and above tackling things that US businesses are making noise about (more on this later).

In a big splashy announcement made by the secretary of homeland security himself, DHS said a year-long US investigation had caught a Chinese fishing fleet, Dalian Ocean Fishing Company, using forced labour. As a result, imports of tuna and swordfish from Dalian would be seized at America’s borders. The investigation had found all of the main signs of forced labour across 32 ships owned or operated by the Chinese company, including physical violence against workers, withholding of wages and restriction of movement, CBP officials said. 

Although it’s a continuation of a Trump trend, the Dalian crackdown alleges the forced labour of Indonesian workers, which broadens the current typical usage of these detainment orders a little: previous orders have largely focused on the Xinjiang region, where the US alleges Uyghurs are being held in detention camps.

Under Trump, orders largely focused on hair products, clothes and cotton, whereas CBP officials were keen to impress that this was the first time a detainment order, known as a “withhold release order”, had been applied to an entire fishing fleet. They are certainly keen to signal that they’re being tough on China.

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A Rising Yuan Sets the Stage for More China-U.S. Currency Friction

A Rising Yuan Sets the Stage for More China-U.S. Currency Friction | NEWS |

The Wall Street Journal

BIG IDEA | ‘On the face of it, that would suggest that the PBOC hasn’t intervened much to check the yuan’s appreciation. But other data tell a more complicated story.’


The People’s Bank of China is getting restive about the strength of the Chinese yuan. That is something to keep an eye on:

  • Any attempt to prevent it from rallying further would provide fresh fuel for a clash between Beijing and Washington over currency manipulation.

At around 6.38 to the U.S. dollar, the yuan is at its strongest level since 2018.

  • The currency needs to rise by only a little over 5% to hit a historical high. It has rallied by almost 12% in the past year already.

The PBOC said Monday that it would raise foreign-exchange reserve requirements for banks after a former central-bank official suggested to state media over the weekend that the currency’s recent strength wasn’t sustainable or desirable.

Given the central bank’s clear discomfort with the rally, the fact that China’s foreign-exchange reserves have barely risen in the past year is eyebrow raising.

  • In the 2000s and early 2010s, China’s large trade surpluses were mirrored by large reserve accumulation.

Since the beginning of 2020, Chinese reserves have risen by 2.9% in U.S. dollar terms, compared with increases of 10.6% and 13.2% in South Korea and Taiwan, two economies that have recorded similarly strong export growth and strengthening currencies during the pandemic.

On the face of it, that would suggest that the PBOC hasn’t intervened much to check the yuan’s appreciation.

But other data tell a more complicated story.

China’s balance-of-payments figures for the final quarter of 2020 showed a modest rise in reserve assets but a surge in two residual categories.

  • The first, named “other investment,” covers transactions that can’t be classed as direct investment, portfolio investment or reserves.
  • The second, “net errors and omissions,” is the final bucket that makes sure the balance of payments actually balances out.

The two categories combined ran to over $200 billion in the final quarter of the year, the highest level on record.

Some of the outflow may simply represent domestic borrowers taking advantage of the weak dollar and strong yuan to repay dollar debt.

  • New Chinese liabilities marked “loan” under the “other investment” category fell from $13 billion in the first quarter of 2020 to minus $44 billion in the final quarter of the year, meaning large-scale repayment.

But that still leaves much of the remainder of these huge capital outflows as a question mark.

  • Alex Etra, senior strategist at Exante Data and a former Federal Reserve economist has noted that the two segments of the balance of payments align wellwith the accumulation of banks’ net foreign assets.
  • And the Chinese central bank has long relied on state banksto intervene in the currency market, avoiding doing the heavy lifting, and the outright attention that would bring.

That method of leaning against further yuan strength attracts fewer headlines than accumulating reserves.

  • But if that is indeed what is happening, it is unlikely to have escaped the attention of the U.S. Treasury Department.
  • Going forward it will be worth keeping a close eye not only on the currency market, but also on the details of China’s payments data to game out the potential for political trouble ahead.
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Beijing Pushes Back Against Yuan Strength. It Could Hurt Chinese Stocks

Beijing Pushes Back Against Yuan Strength. It Could Hurt Chinese Stocks | NEWS |

Chinese officials tried another tactic to slow the appreciation of the yuan, raising foreign exchange reserve requirements for Chinese banks on Monday. It’s the latest sign that Beijing is intent on trying to stem recent currency strengthening—and that could create more pressure on the Chinese stock market in the near-term.

The yuan has strengthened 2.5% versus the dollar in the last two months, with U.S. Dollar/Chinese Yuan last trading at 6.38. Beijing officials have tried to talk down the currency, with limited impact. A stronger currency makes life more difficult for exporters and comes as China’s economic recovery is slowing. Meanwhile, Beijing has become more concerned about inflationary pressures as commodity prices spike.

China’s decision to raise its foreign exchange reserve requirement for Chinese banks to 7% from 5%, as of June 15 is the first such move since 2007. But in the scope of approaches that governments can take with their currency, the move is still a relatively low rung on the ladder of options. Other steps include tighter reporting requirements, actual forex intervention or a more decisive hike in reserve requirements. Nevertheless, it isn’t yet clear whether Beijing is protesting the magnitude of the move, the pace or the direction.

The increase in the reserve requirement will only boost the amount of foreign exchange financial institutions must hold in reserves by around $20 billion—a drop in the bucket, given the $1 trillion deposit base.

That could heat up one of the fronts in the U.S.-China competitive battle. Currency has often been a point of contention, with the Trump administration labeling China as a currency manipulator and then reversing itself.

The currency moves could indirectly make Chinese stocks less attractive when compared with other emerging markets, with a weaker—or at least a more volatile—currency likely hurting foreign investor sentiment for stocks.

And as the global recovery gains traction in other emerging markets and China’s efforts to stem the appreciation of the renminbi put the currency in limbo, other emerging markets could garner more of the investment flows through the year. The iShares MSCI Emerging Markets ETF (EEM) is up almost 2% over the last three months while the iShares MSCI China ETF (MCHI) is down 5.5%—a trend that could continue in the near-term.

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China unlikely to certify Boeing 737 MAX to fly again any time soon, analysts say

China unlikely to certify Boeing 737 MAX to fly again any time soon, analysts say | NEWS |

Boeing CEO Dave Calhoun warned that a prolonged trade deadlock between the United States and China threatens the comeback of its 737 MAX and, ultimately, the company’s long-standing role as an industrial champion.

China will be one of the world’s hottest aviation markets as the coronavirus pandemic recedes, accounting for about a quarter of expected growth in jet sales over the next decade, Calhoun said on Thursday.

But without an agreement in place to restart purchases and deliveries, Boeing cannot be sure when to raise output of the Max, the company’s main source of revenue and cash.

Unlocking China looms as a critical challenge for Boeing now that the Max has returned to service in most of the Americas and Europe, and rising vaccination rates spur a rebound in air travel.

China, the first country to ground the Max more than two years ago after two deadly crashes, has yet to lift its ban on flying the plane.

 The country’s airlines last announced orders for the single-aisle workhorse when Barack Obama was in the White House.

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Australian Exporters Say Normal Business With China ‘Impossible’ 

Australian Exporters Say Normal Business With China ‘Impossible’  | NEWS |

Deteriorating relations, including trade-related friction, have made normal operations for Australian exporters in China “impossible,” according to a report from a leading network of business interests.

Exporters see the need to pivot from China into other markets, including Vietnam, Indonesia and Malaysia, because of the trade disputes, the Australian Chamber of Commerce and Industry said in the report released Friday, which cited a survey of 189 Australian business operators. Tariff management is “costing firms dearly,” the chamber said.

“For those firms trading in the Asian region, especially with China, there is growing disillusionment with the difficulties of managing international relationships,” the report’s authors said.

The report comes as relations between Australia and its largest trading partner, China, have declined for more than a year after Prime Minister Scott Morrison’s government called for independent investigators to enter Wuhan, where the coronavirus began, to look into its origins. Beijing has since inflicted a range of trade reprisals, including crippling tariffs on Australian barley and wine, while blocking coal shipments.

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Taoran Notes | China-US relationship needs ‘cool heads and new strategy’ from Beijing

Taoran Notes | China-US relationship needs ‘cool heads and new strategy’ from Beijing | NEWS |

China needs to stay cool-headed in formulating its new strategy to engage with the US and avoid an emotional handling of disputes that could lead to bigger problems, Chinese state media said in the wake of two high-level talks between the two countries.

A commentary by Taoran Notes – a social media account affiliated with the state-run Economic Daily, used by Beijing to manage expectations on China-US trade talks – said both countries had responded emotionally when tensions were running high, but it was now necessary to calm down, especially as confrontations would not ease soon.

“Don’t be emotional when dealing with problems, also don’t be complacent about small achievements, and it is even more important to avoid incurring real misfortune by chasing false reputation,” it said, following discussions between China’s economic tsar, Vice-Premier and senior US officials – Trade Representative Katherine Tai last week, and Treasury Secretary Janet Yellen on Wednesday.

In Beijing, the talks were seen as a sign that economics and trade are the cornerstone to keeping deteriorating China-US relations stable.

“China and the United States quarrelled and fought fiercely for a while. But after trying all the ways of getting along – except cooperation – China and the United States finally chose the path of cooperation that seeks common ground while reserving differences,” Taoran Notes said.

“China and the United States need to have a deeper understanding of each other’s strengths and intentions, and they need to form a better way of getting along with each other according to the new situation.”

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Who is supporting Chinese tech shares in Hong Kong?

Who is supporting Chinese tech shares in Hong Kong? | NEWS |

Hong Kong may be losing luster as a free city for many locals as "one country, two systems" rapidly fades, but it seems to be looked at differently by mainlanders whose freedoms are restricted at home.

Apparently, Hong Kong is a cozy place to list for mainland companies, as the U.S. becomes more unwelcoming. Big tech names like Alibaba, and NetEase made Hong Kong their secondary listing location as they hedge against their primary listing status in the U.S.

But why Hong Kong? Nana Li, China research director at Asian Corporate Governance Association, believes these brands "prefer the more predictable regulatory regime in Hong Kong, the city's open capital account, and its stronger base of global institutional investors." Even though their main operations are on the mainland, they are missing these aspects.

This in turn invites more global institutional investors to Hong Kong, as there are various restrictions to accessing Chinese companies listed on the mainland. Hong Kong remains the major channel for those who wish to invest in Chinese equities, despite the lack of democracy and civil liberties in China as well as the deterioration of various freedoms in Hong Kong.

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Chinese ships sail near Senkaku Islands for record 112 days straight

Chinese ships sail near Senkaku Islands for record 112 days straight | NEWS |

The China Coast Guard has been making repeated incursions into waters around the Japan-administered Senkaku Islands in the East China Sea, marking a record for the number of consecutive days it has done so.

Chinese vessels sailed through the contiguous zone around the islands on Friday for the 112th straight day, according to the Japan Coast Guard. They have entered the contiguous zone every day since mid-February, surpassing the previous record of 111 consecutive days from April to August of 2020.

The islands, which China claims and calls the Diaoyu, are about 170 km northeast of Taiwan.

"This year is a special year for the Xi Jinping-led government since it is the 100th anniversary of the founding of the Chinese Communist Party," said Rumi Aoyama, professor at Waseda University in Tokyo. "It is focusing on sovereignty issues to show strength at home. So it could take aggressive action around the Senkakus to keep Japan in check."

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Banks bulk up in Hong Kong as China business overshadows politics

Banks bulk up in Hong Kong as China business overshadows politics | NEWS |

Some global banks, funds and other financial services providers say they are stepping up hiring in Hong Kong, in a sign the city's unique position as a financial gateway to China is outweighing concerns about Beijing's tightening grip over it.

The Securities and Futures Commission, Hong Kong's market regulator, is seeing a rebound in licenses it issues for people involved in asset management, securities and other financial activities. The total number of licenses it issued was up 1.7% at the end of March, compared with nine months earlier, and just shy of an all-time peak in 2019.

Many financial companies slowed hiring last year, after protests against Chinese rule and a new security law imposed on the city to crush dissent by Beijing.

The increased hiring plans of some major players show that they are now willing to live with the political risks.

"Everyone in the business community I have spoken with welcomes the peace and stability now, compared with the chaos of 2019," said Weijian Shan, chairman and chief executive of Hong Kong-based private equity group PAG.

The lure of being in Hong Kong comes from the city's close ties to China and the business it brings.

That business is booming. Flows via the stock connect schemes linking Hong Kong with the Shanghai and Shenzhen exchanges rose to record highs in the first quarter of 2021.

Companies, mostly from mainland China, raised more money through Hong Kong listings in the first five months of this year than they did in the same period of the last four years combined, Refinitiv data shows. Mergers and acquisitions in Greater China are the highest since 2018.

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Hong Kong's June 4 candlelit vigil over the years

Hong Kong's June 4 candlelit vigil over the years | NEWS |

No one attended an annual candlelight vigil inside Hong Kong’s Victoria Park on Friday, but hundreds gathered on streets outside to remember China’s deadly crackdown in Beijing’s Tiananmen Square in 1989 as Hong Kong police cordoned off much of the park to prevent gatherings.

Police arrested an organizer of the vigil earlier in the day and warned people not to attend the banned event as authorities mute China’s last pro-democracy voices.

For decades, Hong Kong has been one of just two cities in China allowed to mark the bloody crackdown on pro-democracy protesters in Tiananmen Square.

Each June 4, thousands have gathered in Hong Kong’s Victoria Park to mourn the victims of the crackdown, lighting candles and singing songs in remembrance.

This year, however, Hong Kong authorities banned the vigil for the second consecutive year, citing social distancing restrictions and public health risks from the coronavirus pandemic.

Despite the ban and a heavy police presence, hundreds of people still turned up Friday night to walk along the outside of the park. Many turned on their cellphone flashlights or lit candles.

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Japan likely to defend Taiwan if Beijing makes moves, former US national security official Matt Pottinger says

Japan likely to defend Taiwan if Beijing makes moves, former US national security official Matt Pottinger says | NEWS |

Tokyo would step up militarily to defend Taiwan if Beijing moved to reunify the island with mainland China by force, former deputy national security adviser Matt Pottinger said in a panel discussion on Tuesday with other top Trump administration officials.

“So the whole idea of a quadrilateral format is an idea that [former Japanese prime minister Shinzo Abe] came up with during his first stint as prime minister” in 2006 and 2007, Pottinger said. “The idea of a free and open Indo-Pacific, that concept that, that catchphrase, we consciously adopted it and adapted it from the minds of our closest allies in Japan.”

“There’s a saying in the Japanese military: ‘Taiwan’s defence is Japan’s defence.’ And, and I think that Japan will act accordingly,” Pottinger added.

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Taiwan, feuding with China, gets vaccines from Japan - The

Taiwan, feuding with China, gets vaccines from Japan - The | NEWS |

A flight carrying 1.24 million doses of AstraZeneca coronavirus vaccine from Japan touched down in Taiwan on Friday to help the vaccine-starved island fight its largest outbreak since the pandemic began.

The donation underscores how geopolitics has come to impact the global vaccine rollout, as countries scramble to secure enough doses for their populations. Taiwan, a self-governing island short of doses, has blamed China for interfering in a potential deal for another vaccine.

Now it is more than doubling its vaccine supply thanks to Japan, which is trying to play a greater role in global vaccination distribution and accelerate its own slow rollout ahead of the Tokyo Olympics in July.

Japanese Foreign Minister Toshimitsu Motegi told reporters on Friday that Japan was responding to a Taiwanese request, and that the donation reflects “Japan’s important partnership and friendship with Taiwan.”

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