Voice of America (VOA) Chinese recently reported that Régis Labeaume, the mayor of Quebec City, cancelled his trip to China originally planned for March. The mayor explained that he cancelled the scheduled trip due to the political tension between China and Canada. The Canadian government recently and repeatedly has issued travel warnings asking travelers to China to use extreme caution. The government warning indicated that travelers may face arbitrary enforcement of local laws and other culture related punishments on issues concerning death penalties and drug dealing. The mayor originally planned to visit Shanghai and Xi’an. Quebec City became a sister city with Xi’an in 2001. Ever since Canada arrested Huawei’s CFO last December based on a U.S. request, the Canada-China relationship has suffered a free fall. China has thus far arrested multiple Canadian citizens travelling or working in China.
Source: VOA Chinese, January 20, 2019
Well-known Chinese technology news site Tencent News recently reported that, since the US-China trade war started, China’s economic crisis has impacted the top Chinese Internet giant, the Alibaba Group. Signs are showing that the impact intensified very recently. According to anonymous sources, new hires have been told they could not start their work before the next fiscal year begins in April. Some new hires said the Alibaba Group is reducing headcounts across the board. All business lines are now having hiring freezes. The Group is also cutting business travel funds even for management personnel. For example, now one can only use business class for air travel once every five trips and these trips have to exceed 20 hours per round trip. The Alibaba Group (NYSE: BABA) is China’s largest online service provider. In 2015, Alibaba’s online trade volume exceeded RMB 3 trillion (US$442 billion), making the Group the largest retailer in the world. Alibaba Group’s financial health is often seen as a barometer of the Chinese economy.
Source: Tencent News, January 18, 2019
Deutsche Welle Chinese Edition recently reported that Gerd Müller, the German Federal Minister of Economic Cooperation and Development, warned emerging countries about loans from China. He advised that borrowers should avoid developing any dependency on China provided loans. Such loans have had a lot of transparency issues regarding actual debt level and loan conditions. Gerd used Sri Lanka as an example. Sri Lanka lost control of the Port of Hambantota to China under a “rental” agreement, (in effect, a 99-year lease). This was the result of the high debt level Sri Lanka had with China. Gerd reemphasized his point during his recent visit to Africa, where he mentioned the high debt level of Zambia and its loans from China. One of the primary parties was the Zambia Power Supply Company (Zesco) that provided a guarantee. In the past few years, China invested a large amount money in African infrastructure. These investments were often China-backed loans, which were used to fund Chinese companies to deliver construction. Natural resources were often used to serve as the payment of the debt. In addition, these contracts often lacked transparency.
Source: Deutsche Welle Chinese Edition, January 16, 2019
A recent statement from the Chinese Embassy in Myanmar has caused great controversy. Leaders of several political parties in the Kachin State of north Myanmar expressed strong opposition. Some observers believe that if the confrontational situation continues to expand, it is possible to reignite the wave of anti-Chinese investment that was sweeping across Myanmar a few years ago.
Hong Liang, the Chinese Ambassador to Myanmar visited Kachin State at the end of 2018. Hong met with the heads of the local five political parties and a religious organization. Topics discussed included the peace process in Myanmar, the resettlement of refugees, drug control, and the economic and trade cooperation with China.
Hong’s meeting was not well received. Gumgrawng Awng Hkam, leader of Kachin Democratic Party (KDP), and Rev. Hkalam Samson, pastor from Kachin Baptist Churches, said in an interview that the attitude of the Chinese ambassador at the meeting was somewhat arrogant. Hong warned these leaders not to establish friendship with Western diplomats and not to oppose China’s investment projects in Kachin State, including the Myitsone hydropower station that has been on hold for more than seven years.
A week before the Chinese ambassador’s visit, the US and British ambassadors also visited Kachin. They also met with leaders of local political parties and discussed the peace processes, refugee resettlement, education and medical care, and fair and free elections. Kachin’s political leaders suggested that the two ambassadors set up liaison offices in the state capital of Myitkyina to strengthen their ties.
More than 90 percent of the Kachin people believe in Christianity. Local religious groups and political parties have maintained close ties with Western churches and political circles. Gumgrawng Awng Hkam believes that the warning that the Chinese ambassador made to the Kachin people “felt like a threat.”
On January 13, the Chinese Embassy in Myanmar issued a statement. The statement said that the Myitsone hydropower project has been put on hold for seven years and is one of the difficulties that China-Myanmar cooperation faces. If this problem cannot be resolved after a long delay, it will seriously damage the confidence of Chinese entrepreneurs in investing in Myanmar. The economic and social development of Myanmar and the construction of the China-Myanmar Economic Corridor require an adequate electricity supply. To this end, China and Myanmar have conducted close consultations on the Myitsone hydropower project in an effort to find a solution acceptable to both parties as soon as possible. The support of the Kachin State people will be highly valued.
The statement also said, “The people of Kachin State did not oppose the Myitsone project. It is some individuals and some foreign organizations that opposed the project.”
In response to the statement from the Chinese Embassy, on January 14, Kachin State’s three main political parties – the Kachin National Congress (KNC), the Kachin State Democratic Party (KSDP), and the Kachin Democratic Party (KDP) issued a joint statement. The statement declared that the Kachin people represented by the three political parties have the same desire, which is to completely stop the construction of the Myitsone hydropower project.
The three political parties, which all attended the meeting with Chinese Ambassador Hong in December, are applying to form a unified political party to participate in the 2020 Myanmar election.
After the publication of the joint statement, Gumgrawng Awng Hkam showed a strong attitude in the interview. “From the beginning, we have been against the project of Myitsone. Our people disagree with it and our political parties also oppose it. However, China refuses to give up and continues to work hard to advance it. They said that due to the failure of Mysone Chinese investors are hesitant to make new investments in Myanmar. I want to tell the Chinese ambassador and China again that our party and I totally disagree with this project.”
The Myitsone Hydropower Project, with a planned total investment of US$3.6 billion, was launched in 2009, but the local people and people in other parts of Myanmart quickly opposed it. Then President of Myanmar, Thein Sein, stopped the project in September 2011. After Aung San Suu Kyi’s National League for Democracy (NLD) government took office, an investigation team was formed to investigate the feasibility, environmental impact and immigration issues of the Myitsone project. The team has completed two investigation reports so far, but the NLD government has not made the reports public.
The project’s investor, China’s State Power Investment Corporation (SPIC), has not given up the project. In September 2018, media reported that the SPIC project leader organized meetings in the villages of Kachin to promote the project to the local people. According to SPIC, due to the shelving of the project, the Myanmar government has to pay the Chinese side US$50 million in compensation every year. Once the project is completely cancelled, Myanmar is facing a payment of up to US$800 million for breaching the contract.
Sweden’s Burmese expert Bertil Lintner wrote in the Asia Times that Aung San Suu Kyi had to seek more support from China because of the pressure and sanctions imposed by the Europeans and Americans on the Rohingya refugee issue. At that point, China intensified its efforts to lobby Myanmar to restart the Myitsone hydropower station, and it asked for a high return from Myanmar. He believes: “China’s new push for the Myitsone dam represents a gamble, one that could reignite the popular anti-China movement that swept the country in 2011, and one that even Suu Kyi would be hard-pressed to stop once started.”
Source: Voice of America, January 17, 2019
Following the 2018 incident of pressuring foreign airlines to identify Taiwan and Hong Kong properly as being part of China, China has turned to targeting foreign companies in China who don’t label Taiwan and Hong Kong correctly.
According to an article that Legal Daily published, the Institute of Law of the Chinese Academy of Social Sciences and the Internet Development Research Center of Peking University recently jointly published the first “Blue Book of the Internet Rule of Law – the 2018 China Internet Rule of Law Development Report.” In the Blue Book, it stated that among the world’s top 385 companies conducting business operations in China in 2017, 83 of them didn’t properly identify Taiwan and China on their company’s official website. Among them, there were 66 foreign companies misidentifying Taiwan, 53 foreign companies misidentifying Hong Kong, and 45 foreign companies that misidentified Taiwan and Hong Kong. The chief editor of the Blue Book told Legal Daily that the “one China” policy has sufficient basis under international and domestic law. He suggested that China should use existing laws and regulations to dispose relevant violations resolutely. China will impose warnings, fines, and confiscation of illegal income on violators and order them to suspend business until they rectify the situation.
Source: Legal Daily, January 16, 2019
On January 17, China’s provincial level police chiefs gathered together in Beijing where State Councilor and Minister of Public Security Zhao Kezhi delivered a speech. According to official reports, Zhao proposed to create a safe and stable political and social environment for the 70th anniversary of the founding of the People’s Republic of China as a major political task for the nationwide police forces.
On 21 September 1949, then Communist Party Chairman Mao Zedong proclaimed the establishment of the People’s Republic of China. 2019 is also the 30th anniversary of the June 4th incident in 1989 and 20th anniversary of the persecution of Falun Gong which began in 1999. China is also facing a series of challenges such as trade negotiations with the U.S. and a slowing domestic economy. It has been reported that Zhao also mentioned in his speech to senior officials of the Ministry of Public Security that it is necessary to guard against a “color revolution” and to battle for political security.
Zhao asked that all be on high alert for political security and always make the prevention of political risks a top priority. He demanded they “strictly guard against and resolutely crack down on various invasive and subversive activities of hostile forces at home and abroad, deepen anti-terrorism and anti-secession struggles, firmly defend political security, and resolutely defend the leadership of the Chinese Communist Party and the socialist system of our country.”
Source: Beijing News, January 18, 2019