China’s government has reportedly started enforcing a new law that it passed in December this week. The law bans the government from purchasing PCs with Intel and AMD chips inside, along with software products from Microsoft, including its Windows operating system.

According to The Financial Times (via PC World), the new rules on purchasing products for China’s government PCs were set in place in December by the country’s Information Technology Security Evaluation Center. They include all governments and agencies above what is considered to be the country’s township level.

China previously ordered its government offices and agencies to no longer use Microsoft’s Windows OS in 2022, in favor of a homegrown Linux-based OS. As a result, these new guidelines are not expected to affect Microsoft. However, the ban on Intel and AMD chips could result in a noticeable hit in the revenue numbers for both companies.

On the other hand, the ban on these products on China’s government PCs does not include their use in private businesses or by regular consumers in that country.

China previously banned the use of Apple’s iPhone products in its government buildings. It has also banned the use of products from Micron Technology for its infrastructure projects, citing security concerns.

These new moves come sometime after the United States government banned China’s Semiconductor Manufacturing International Corporation (SMIC) from exporting fabrication equipment to make certain chips in that country.

Late in 2023, the US government banned the export of some of Nvidia’s AI GPUs to China. Nvidia has instead developed AI chips, the H20, that were specifically made to conform to the restrictions of the US government’s export rules. The company started taking preorders for the H20 chips in early 2024, and are expected to begin large scale shipments of those China-specific AI GPUs sometime in the second quarter of 2024.

Source: Neowin

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At this point in its term of office, the Biden Administration had hoped for a markedly different Middle East.

Under American tutelage, the Trump-era Abraham Accords would have ideally widened the circle of peace among Arab states and Israel, effectively ending the Arab-Israeli conflict and purportedly bringing stability and prosperity to a region sorely in need of it. As regional rivals reconciled their differences, Washington could refocus its attention on the Indo-Pacific region, shifting military and diplomatic assets to counter China.

In this new, more united Middle East, the threat of Iran would be contained by a formidable array of Arab and Israeli military power, and the Palestinian issue (regrettably resistant to any lasting solution, in the jaded view of government officials and pundits alike) would be safely contained. The Palestinians themselves would be mollified by new aid and investments from the wealthy Arab countries, an ample consolation prize in place of their own state. The threat of terrorism and conflict would have been reduced to manageable terms.

The war in Gaza has changed the entire diplomatic and military landscape into the one that Washington had hoped to avoid. Current conditions present daunting new challenges for the Biden administration, including the fearsome threat of wider regional confrontation.

Of course, the reality today is depressingly different. The war in Gaza has changed the entire diplomatic and military landscape into the one that Washington had hoped to avoid. Current conditions present daunting new challenges for the Biden administration, including the fearsome threat of wider regional confrontation.

As they say in the Pentagon, “No plan ever survived first contact with the enemy,” a wise maxim the Biden administration is currently relearning.

Things Fall Apart; the Center Cannot Hold

In the immediate aftermath of the Hamas attack in southern Israel on October 7, President Joe Biden took a safe, traditional position, completely within a longstanding Washington consensus —full support of Israel’s “right to defend itself,’ bolstered by pledges of substantial military aid, and backed in this instance by the dispatch of two aircraft carrier strike groups, the USS Gerald R. Ford and the USS Dwight D. Eisenhower, to positions off Israel’s Mediterranean coast and in the Red Sea, respectively. But this supposedly safe position rapidly deteriorated into domestic and international political controversy as Biden discovered that fully backing Israel came with substantial political costs he hadn’t, apparently, anticipated.

With Biden’s poll standing eroding, due in no small part to his stance on the conflict, Washington’s diplomatic position has been evolving rapidly. During his tour of the region in early November, Secretary of State Antony Blinken called for “humanitarian pauses”—not to be confused with a “ceasefire”—to allow humanitarian aid shipments to arrive in Gaza. In Tokyo a few days later for a meeting of G-7 foreign ministers, Blinken went significantly further, specifying American terms for an immediate post-war future. He said that there must be “no forcible displacement of Palestinians from Gaza. Not now, not after the war…No use of Gaza as a platform for terrorism or other violent attacks. No reoccupation of Gaza after the conflict ends. No attempt to blockade or besiege Gaza. No reduction in the territory of Gaza…It is imperative that the Palestinian people be central to governance in Gaza and in the West Bank as well, and that, again, we don’t see a reoccupation.”

With Biden’s poll standing eroding, due in no small part to his stance on the conflict, Washington’s diplomatic position has been evolving rapidly.

This is not only aimed at discouraging Israel’s possible imposition of a security zone in Gaza such as that enforced by Tel Aviv in southern Lebanon for 15 years, but also to suggest a new political horizon going forward. In Tokyo, Blinken hinted at that horizon, albeit in vague terms, saying that “it’s vitally important that Palestinian aspirations for governing themselves, for being the ones to decide their own futures, are realized.” This may fall short of a commitment to doing the long, hard work of bringing about a two-state solution, but it may be a start.

US Politics and Rising Pressure on Israel

Meanwhile, domestic political pressures almost unheard of in Washington are continuing to build: popular opinion in the United States, particularly among Democrats, is breaking sharply against Israel. On November 8, 26 Senate Democrats and Independents signed a letter to President Biden asking pointedly whether his administration can ensure that Israeli military operations in Gaza are being “carried out in accordance with international humanitarian law.” While the pro-Israel foundation in Congress remains generally solid, it seems cracks have begun to appear.

The administration is also faced with almost unprecedented dissent in the ranks of the federal bureaucracy. Foreign Service officers have in recent days signed onto three different dissent channel cables, a mechanism established during the Vietnam War to enable the rank-and-file to speak their minds without going messily public. The cables proposed some form of ceasefire to end the Israeli onslaught. Blinken himself felt compelled to meet with at least some of the signatories. And just this week, around 500 career officials and political appointees from about 40 government agencies signed a letter to President Biden also endorsing a ceasefire, citing polling data showing about two-thirds of Americans in favor of it and a de-escalation of violence.

The increasingly desperate situation in Gaza, including 1.5 million internally displaced persons as well as a death toll now exceeding 11,000, has fueled this rising controversy. Former Israeli Prime Minister Ehud Barak, for one, has taken notice, worrying that Israel has limited time to achieve its stated objective of eliminating Hamas in the Gaza Strip before it is forced to bow to pressure, primarily from the United States, to halt its military operations. It is a message that has been re-enforced this month by senior administration officials in contacts with their Israeli counterparts.

Israel’s Reaction

To complicate matters, the Israeli government does not necessarily seem to share the same playbook from which the United States is currently working. On November 7, Prime Minister Benjamin Netanyahu announced  that Israel will maintain “overall security responsibility” in Gaza for an indefinite period, with no apparent plans for a transition to a diplomatic process to follow. While this falls a bit short of reoccupation, and certainly of the re-establishment of settlements of which some on the far Israeli right dream, it nevertheless opens the door to an untenable political situation that Washington clearly finds undesirable.

Meanwhile, the situation in Gaza continues to deteriorate. November 10 brought news that Israel has besieged several hospitals in Gaza, alleging that they are being used as storage facilities by Hamas, and demanding they be evacuated. A particular focus of Israel’s ire is Gaza’s largest medical complex, Al-Shifa Hospital, under which Israel claims Hamas maintains a system of military bunkers. Early on November 15, Israeli troops entered the complex and alleged that weapons were found inside; but Hamas denied the claim. The increasing number of casualties, ongoing military strikes, and lack of fuel has brought the medical system in Gaza to the point of total collapse.

Israel has agreed to White House demands for short operational pauses in northern Gaza to permit humanitarian aid to enter, but these will not substantially alleviate the suffering of Palestinians throughout the Gaza Strip, and do not necessarily betoken any willingness to consider a broader ceasefire.

Israel has agreed to White House demands for short operational pauses in northern Gaza to permit humanitarian aid to enter, but these will not substantially alleviate the suffering of Palestinians throughout the Gaza Strip, and do not necessarily betoken any willingness to consider a broader ceasefire. Netanyahu has in fact resisted American requests for a longer pause, even to facilitate the release of hostages. Intensive US diplomacy to persuade Israel to commit to more on the humanitarian front continues.

For the future, Netanyahu has steadfastly refused to consider a meaningful peace process after the conflict ends. Indeed, violent West Bank settlers seemingly backed by the Israeli Army have embarked on what can only be described as a campaign of ethnic cleansing in the occupied West Bank, a development that may prove even more incendiary than the ongoing violence in Gaza.

Regional Context Evolving

The Biden administration is now reduced to trying to stave off a slow-motion wreck of a once hopeful Middle East policy. A formal diplomatic rapprochement between Israel and Saudi Arabia may still take place—despite the Gaza war, both countries have an interest it making it happen—but it is by no means certain and in any case has suffered a real setback. Saudi Arabia has increased its criticism of Israel and reportedly paused any consideration of a deal to normalize relations. Instead, Riyadh hosted an Arab-Islamic summit meeting that included President Ibrahim Raisi of Iran, a diplomatic breakthrough of a very different kind that may not have been possible absent the Gaza crisis. The assembled leaders called for UN Security Council action to adopt a resolution under its binding Chapter 7 authority to halt Israel’s “aggression,” essentially a call for an indefinite ceasefire, cutting against American policy and adding to the international pressure on Washington.

Other Arab states are likewise backing away from Israel. Egypt, which has only ever enjoyed a cold peace with Israel, has made clear that it will not accept a mass transfer of refugees from Gaza to northern Sinai, for fear that they will not be allowed to return, a worry that is by no means unfounded. Cairo has also indicated that it will not participate in defeating Hamas, as it needs the group to help enforce border security. Jordan has declared Israel’s ambassador persona non grata and announced that “all options are on the table” in terms of a response. The United Arab Emirates has adopted a somewhat more measured response, favoring a ceasefire and warning that the United States will lose influence if a solution is not reached soon. Worried about their own domestic politics, several Arab states have individually importuned Washington to do more to pressure Israel to end its military campaign.

The one regional power that seems comfortable with Biden’s policy so far is Iran, apparently seeing it as an opportunity to rally popular and regional leadership opinion to its anti-US and Israel stance.

The one regional power that seems comfortable with Biden’s policy so far is Iran, apparently seeing it as an opportunity to rally popular and regional leadership opinion to its anti-US and Israel stance. The immediate danger of a broader conflict involving Iran and its allies versus the United States and Israel seems not to be imminent, but that does not mean it has gone away. Fighting between Israel and Hezbollah has escalated significantly in recent days, and the party’s Secretary-General Hassan Nasrallah warned in separate speeches earlier this month that while the group did not intend to enter the war as a full combatant, it would respond in kind to Israeli attacks on Gaza or Lebanon.

For an administration that staked its regional policy on an expansion of the Abraham Accords, these developments are concerning. They do not necessarily mean an end to the administration’s hopes for further regional integration once the Gaza conflict ends, but they do illustrate the many difficulties and fresh complications ahead—probably quite a few more than US officials anticipated just a few weeks ago. And if a broader conflict should erupt, possibly with the direct involvement of US forces, all bets are off.

Is There an Endgame?

As with any crisis in the Middle East, there is an undeniable but limited opportunity to effect fundamental change in the region’s dynamics. Previous conflagrations have led to major, if incomplete, peacemaking efforts spearheaded by Washington. This moment may be no different. Blinken spoke in Tokyo of “setting the conditions for durable peace and security and to frame our diplomatic efforts now with that in mind.” To be sure, there is, reportedly, discussion of the details of a future peace process at lower levels in the State Department.

But still, at the moment there is little obvious appetite in the White House for either a ceasefire, a peace process, or the political heavy lifting involved in bringing about either. Biden himself has talked in general terms about the need for a two-state solution “when this crisis is over,” but if he’s serious, much more needs to be done, and now.

The Biden administration must act quickly and offer specific plans and timelines to shape post-conflict expectations and establish its priorities with the parties. If it doesn’t, the most radical elements on all sides will set the agenda. Above all, Biden himself has to be willing to recommit his presidency to a major diplomatic push, probably one that will involve both pressure and inducements to raise the stakes for all parties if they fail to cooperate. This seems unlikely at the moment, but intense crises have made potent peacemakers of presidents before.

Source : Arab Center Washington DC

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BEIJING – Since March 2023, when China started to issue tourist visas again, business has picked up for Beijing tour guide Vivie Pan, who organises small group tours for English-speaking visitors.

But the numbers are nowhere near the levels of 2018 and 2019, before the Covid-19 pandemic. Back then, she received up to three or four bookings a day, and had to rope in other guides to help.

“For this year, I have enough bookings only for myself. I was quite busy from June until November almost every day, with three or four rest days per month, but still there’s no comparison to 2019,” said Ms Pan, who drove part-time for private car-hire company Didi to make ends meet during the pandemic.

“The overseas tourists are coming back, but their main purpose is not sightseeing or leisure – it’s usually business or visiting friends.”

In the first half of 2023, travel agencies received 477,800 inbound tourists, compared with more than 8.56 million for the same period in 2019, according to statistics released by the Chinese Ministry of Culture and Tourism.

The sluggish recovery has been on the government’s radar – it has implemented a series of measures to ease potential pain points of visitors. For instance, in August, the authorities did away with the need for travellers to have a negative Covid-19 test to enter the country.

The latest move came on Nov 24, when China unilaterally announced a year-long visa-free policy for visitors from France, Italy, Germany, the Netherlands, Spain and Malaysia from Dec 1.

This saves them the hassle of filling up pages of forms that include planned itinerary and travel history.

On Dec 1, more than 2,000 people from these six countries entered China – an increase of 12.5 per cent over the previous day, said China’s immigration authorities.

Industry players have welcomed the move, but noted that difficulties remain in persuading tourists to come back. These include limited availability of flights and tightened purse strings, as well as geopolitical tensions that affect perceptions of China.

Veteran industry observer Oliver Sedlinger, who is chief executive of tourism consultancy Sedlinger & Associates, said a short-term challenge is flight availability, noting that China’s international flights have recovered to only about 57 per cent since the start of 2023.

“The recent new visa policies introduced by China are a very smart move and will make travelling there easier,” he said, adding that this would likely provide a strong boost to visitor numbers from these markets.

Dr Liu Simin, vice-president of the tourism branch of the China Society for Futures Studies research institute, likewise said the move would spur growth.

But he pointed out that the major source countries before the pandemic, such as the United States, Japan and South Korea, were not included in the visa-free policy.

“Although the pandemic is over, the negative effects of pandemic controls have yet to completely disappear. Foreigners may not yet be fully aware of the situation in China today,” he said.

Western countries have also, in general, experienced inflation after the pandemic and consequently a decrease in disposable incomes, with less to spend on travelling, he added.

Geopolitics is yet another factor.

Associate Professor Chong Ja Ian of the National University of Singapore said the squabbles China has with other countries are a dampener on tourist visits from there.

For one thing, China-Japan relations hit a rough patch after Beijing strongly criticised Tokyo for releasing treated radioactive water from the Fukushima nuclear plant, starting from August 2023.

Adding to the problem are China’s exit bans and detentions of individuals associated with particular states, as well as raids on business, said Prof Chong, who specialises in Chinese foreign policy.

For example, Chinese investigations into US-related firms earlier in 2023 spooked the business community.

The authorities had visited the offices of Capvision, Bain & Company and Mintz Group, in what was seen as a crackdown on consulting and due diligence firms.

Memories of the sudden closure of borders and the zero-Covid policy are also relatively fresh, said Prof Chong, and this is reinforced by recent reports of an outbreak of an unidentified disease with flu-like symptoms in China.

“For leisure travellers, the world is a big place with many attractive sites, many of which offer better value and comfort than the PRC,” he said, referring to China’s official name, the People’s Republic of China.

Still, some industry players are already looking forward to 2024.

A spokeswoman for Trip.com Group, a major travel service conglomerate headquartered in Shanghai, said demand for travel to China is expected to rise in the near future. She said Trip.com data showed that global search results for inbound travel to China increased in the third quarter by nearly 40 per cent compared with the previous quarter. 

Some believe that more publicity could be the answer to raising tourist numbers.

Mr Tang Gang, president of Chongqing-based Century Cruises, said “vigorous promotion and publicity” is needed to further stimulate demand, adding that his Yangtze river cruise firm served tourists mainly from Hong Kong, Macau, Singapore, Malaysia and Thailand in 2023.

Ms Pan, the tour guide, believes the outlook for 2024 will be better.

“I’ve already received a handful of clients for March, as well as a few inquiries. There are also a few coming from Malaysia and Singapore in December,” she said.

“But I’m sure it will not be as buoyant as before the end of 2019.” 

Source : The Straits Times

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When South Korea’s president, Yoon Suk-yeol, entered office last year, the odds rose that a frostier bilateral relationship with China might take hold. After all, Yoon on the campaign trail talked tough on China, and conservative South Korean politicians typically deepen the US alliance and are suspicious of Chinese support to the Democratic People’s Republic of Korea (DPRK or North Korea). Even despite the growing closeness of DPRK-China ties, Yoon has been able to effectively manage his government’s relationship with Beijing, potentially setting a template for how other small and medium-sized nations might do the same.

Yoon’s Carrots and Sticks ApproachIndeed, as I have previously argued, Yoon and his government, to some extent, have taken a harder line on China. For example, Yoon became the first South Korean leader to attend the North Atlantic Treaty Organization (NATO) Summit, during which he criticized not only Russia, but China as well. In April, before his state visit to Washington for a summit at the White House with President Joe Biden, Yoon railed against any “attempt to change the status quo by force” in the Taiwan Strait. He further offered that South Korea would cooperate with the international community to prevent such an outcome. Yoon’s comments predictably angered China and sparked a monthslong diplomatic tit-for-tat that stretched into the summer.As part of that summit, Biden and Yoon jointly issued the “Washington Declaration,” which includes measures to enhance extended deterrence, such as the establishment of a nuclear consultative group, the exchange of nuclear-related information and visits by nuclear-powered military assets like the B-52 and submarines, which could be leveraged not only for a North Korea, but China-related contingency as well.But Yoon has simultaneously tried to keep an even hand in dealing with Beijing. For instance, when then-House Speaker Nancy Pelosi visited South Korea after her highly controversial visit to Taiwan to meet President Tsai Ing-wen, Yoon was nowhere to be found. The presidential office said he was on a five-day vacation and had no plans to meet with Pelosi, though he eventually did hold a last-minute phone call with her. His administration has also treaded softly in the country’s debut Indo-Pacific strategy statement in December, referring to China as a “key partner” with which Seoul “will nurture a sounder and more mature relationship as we pursue shared interests based on mutual respect and reciprocity, guided by international norms and rules.”Such moves have probably contributed to a gradually stabilizing and normalizing of the South Korea-China relationship. For example, this week, South Korea resumed trilateral talks with China and Japan, a mechanism that had been dormant since 2019. This foreign ministers-level meeting is paving the way for a trilateral summit soon. In a surprising new pact that goes into effect in May, Beijing relented to Seoul this month and will mandate that its fishing boat (and presumably fishing militia forces) keep their trackers on to help the South Korean coast guard combat illegal fishing within its exclusive economic zone.China’s Likely Considerations/CalculationsYoon’s foreign policy, however, is probably only one part of the story. Dismal Chinese economic numbers—including a collapse in exports, leveling off of inflation, rising unemployment, and slowing consumption, production, and investment—may be prompting Beijing to achieve a better partnership with Seoul. The same could be true for Chinese President Xi Jinping’s decision to meet with US President Joe Biden earlier this month at the Asia-Pacific Economic Cooperation (APEC) Summit in San Francisco.Another factor is probably Yoon’s push to open and strengthen ties with Japan, which has a strained relationship with China. Earlier this year, Yoon held a summit with his counterpart, Japanese Prime Minister Fumio Kishida—the first of its kind in over a decade. Since then, Seoul and Tokyo have agreed to resuscitate a military information-sharing agreement, and in August, Biden met with Yoon and Kishida at Camp David in the first-ever standalone trilateral summit between the three nations. Earlier this month, Secretary of Defense Lloyd Austin sat down in another unprecedented trilateral with South Korean and Japanese defense ministers to share information relevant to “severe security environments,” suggesting that North Korea isn’t the only target. Hence, Beijing probably seeks to undermine and ultimately end the strengthening South Korea-Japan partnership possibly aimed at it.Yet another factor may have more to do with China’s military modernization than anything South Korea is doing. When I visited Seoul earlier this month, I spoke with an interlocutor who believed that Beijing’s calculus is rapidly changing on the so-called “Three No’s” demanded of Seoul in 2017, including no new deployment of Terminal High Altitude Area Defense (THAAD) batteries, no South Korean integration into US regional missile defenses, and no trilateral military alliance with Japan and the United States. His theory was that Beijing’s rapid progress in developing a credible nuclear triad (capable of nuclear attacks from land, air, and sea) reduces the salience of pressuring Seoul to follow the Three Nos—a commitment Seoul denies actually exists anyhow.ConclusionAlthough South Korea is arguably inching closer to a trilateral military alliance with the US and Japan, now featuring, for example, joint military exercises, China can still rationalize that the partnership is still too new and possibly ephemeral, likely circumscribed and strained by lingering mistrust from World War II legacy issues, such as the comfort women.In the end, Yoon’s China policy has been unexpectedly successful thus far. He is also buoyed by the South Korean public’s increasingly negative views on China, with the nation now reportedly holding the most anti-China sentiment worldwide. Of course, Yoon is still a relatively new president—he is less than two years into his five-year term—and much could still go wrong, especially if he pursues the Taiwan issue more assertively. But for now, at least, Yoon and his government have successfully managed China, and perhaps offered a road map for how others can too.

Source : 38 North

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China will speed up the introduction of more policies to consolidate its economic recovery, state media CCTV reported on Wednesday, citing a cabinet meeting chaired by Premier Li Qiang, after the economy showed tentative signs of stabilising.

With a flurry of support steps kicking in, the $18 trillion economy showed better-than-expected figures including bank lending, industrial production and consumption gauges last month, but the wobbling property sector still weighs on its economic outlook.

China will stick to deepening reforms and further opening up and will fully mobilize the enthusiasm of businesses, CCTV said.

“China will accelerate the introduction of relevant policies and work implementation, as well as further consolidate the economy’s upward trend,” CCTV said.

Feedback from an inspection and survey of the country’s economic recovery was presented at the meeting, according to state media.

Local governments and government departments must attach great attention to problems found during the inspection and survey, and push for policy measures already released to take effect, CCTV reported, citing the meeting.

Responding to the advice gathered during the survey, relevant government departments should make plans and carry out in-depth research considering 2024’s economic work, the state media said.

The world’s second-biggest economy lost steam since April as its rebound from COVID reopening missed expectations by markets and economists.

China should step up policy support for the economy while promoting reforms to help achieve the annual growth target of around 5%, Yi Gang, former governor of the People’s Bank of China (PBOC), said in remarks published on Wednesday.

The Asian Development Bank on Wednesday trimmed its growth forecast of China to 4.9% from 5.0% in July due to the weakness in the property sector.

Source: Yahoo

The post China Pledges to Accelerate Introduction of More Economic Policies appeared first on Policy Print.

Republican presidential candidate Vivek Ramaswamy is set to unveil his plan to “declare economic independence from China” in a preview of his policy speech obtained by Fox News Digital. 

In his address that will be given Thursday in his hometown of Columbus, Ohio, Ramaswamy says he will “delineate the heretofore-unexamined connection between the rise of ‘stakeholder capitalism’ in the West and China’s use of that trend to achieve economic parity with the U.S. by failing to adopt the constraints that multinational institutions apply to the U.S.”

“This includes the use of forced data and technology transfers and even pro-CCP U.S. lobbying as a condition for acquiring licenses to do business in China, including but not limited to applying constraints (e.g. emissions caps) in the U.S. while failing to apply such caps in China,” the preview of his speech read.

Republican presidential candidate Vivek Ramaswamy is set to unveil his plan to “declare economic independence from China” in a preview of his policy speech obtained by Fox News Digital. 

In his address that will be given Thursday in his hometown of Columbus, Ohio, Ramaswamy says he will “delineate the heretofore-unexamined connection between the rise of ‘stakeholder capitalism’ in the West and China’s use of that trend to achieve economic parity with the U.S. by failing to adopt the constraints that multinational institutions apply to the U.S.”

“This includes the use of forced data and technology transfers and even pro-CCP U.S. lobbying as a condition for acquiring licenses to do business in China, including but not limited to applying constraints (e.g. emissions caps) in the U.S. while failing to apply such caps in China,” the preview of his speech read.

Ramaswamy will boast what he calls a “pro-trade approach to sensibly decoupling from China” and knocked conservatives who reject a “trade-led agenda” as “unserious.”

“To declare independence from China abroad, we must first declare independence from the climate change agenda at home,” the preview read. “Electric vehicle agenda worsens dependence on China for rare earth minerals and mineral refining capacity: when U.S. taxpayers subsidize EVs, American taxpayers subsidize the CCP.”

Ramaswamy asserts the climate change agenda “has nothing to do with the climate and everything to do with letting China catch up to the U.S.,” adding that “this is something that the Republican Party has missed in entirety.”

The political outsider reiterated his call for semiconductor independence, calling the CHIPS Act that was passed and sign into law by the Biden administration a “boondoggle” and describing it as the “Green New Deal in chips-related clothing.”

“The right answer: more narrowly tailored pro-semiconductor policy in the U.S., but without the excesses and political trinkets of the CHIPS Act — not as a matter of economic protectionism, but as a matter of national security,” the preview read. “Key way to stop this from simply serving as corporate ‘pork’ — simultaneously open trade relationships with South Korea, Japan, and other nations that provide market access for their own semiconductors to the U.S. market to compete with domestically supported U.S. semiconductor manufacturers.

He will highlight the U.S. military’s reliance on China, pointing out how the CCP is a leading producer of “16” out of the 35 strategic materials identified as critical by the Department of Defense. 

“Limiting foreign engagement in other parts of the world (e.g. Ukraine and Middle East) will reopen substantial funds to reinvest in our domestic defense base without the need for expanding the overall U.S. military budget,” the preview read. “Vivek will modernize the Reagan Doctrine to the 21st century — from ‘peace through strength’ to ‘prosperity through peace.'”

Ramaswamy will also propose weakening America’s pharmaceutical reliance on China by bolstering trade partnerships with Israel and India and will do the same regarding rare earth minerals with countries like India and Brazil, adding that Chile is “the world’s third-greatest lithium reserves” yet “our third-largest lithium partner is China.”

“We don’t have to ban Chinese imports; we just need to buy from other countries that produce the same things. I call on all American companies to declare lithium independence from China and grow their imports from Chile,” Ramaswamy will declare according to the preview. 

Source : Fox News

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The last time a U.S. Treasury secretary visited China, Washington and Beijing were locked in a trade war, the Trump administration was preparing to label China a currency manipulator, and fraying relations between the two countries were roiling global markets.

Four years later, as Treasury Secretary Janet L. Yellen prepares to arrive in Beijing, many of the economic policy concerns that have been festering between the United States and China remain — or have even intensified — despite the Biden administration’s less antagonistic tone.

The tariffs that President Donald J. Trump imposed on Chinese goods are still in effect. President Biden has been working to restrict China’s access to critical technology such as semiconductors. And new restrictions curbing American investment in China are looming.

Treasury Department officials have downplayed expectations for major breakthroughs on Ms. Yellen’s four-day trip, which begins when she arrives in Beijing on Thursday. They suggest instead that her meetings with senior Chinese officials are intended to improve communication between the world’s two largest economies. But tensions between the United States and China remain high, and conversations between Ms. Yellen and her counterparts are likely to be difficult. She met in Washington with Xie Feng, China’s ambassador, on Monday, and the two officials had a “frank and productive discussion,” according to the Treasury.

Here are some of the most contentious issues that have sown divisions between the United States and China.

Technology and trade controls

Chinese officials are still smarting at the Biden administration’s 2022 decision to place significant limitations on the kinds of advanced semiconductors and chip-making machinery that can be sent to China. Those limits have hampered China’s efforts to develop artificial intelligence and other kinds of advanced computing that are expected to help power each country’s economy and military going forward.

The government of the Netherlands, which is home to semiconductor machinery maker ASML, on Friday announced new restrictions on machinery exports to China. On Monday, China placed restrictions on exports of germanium and gallium, two metals used to make chips.

The Biden administration is mulling further controls on advanced chips and on American investment into cutting-edge Chinese technology.

Semiconductors have always been one of the biggest and most valuable categories of U.S. exports to China, and while the Chinese government is investing heavily in its domestic capacity, it remains many years behind the United States.

The Biden administration’s subsidy program to strengthen the U.S. semiconductor industry has also rankled Chinese officials, especially since it includes restrictions on investing in China. Companies that accept U.S. government money to build new chip facilities in the United States are forbidden to make new, high-tech investments in China.

And while Chinese officials — and some American manufacturers — were hopeful that the Biden administration would lift tariffs on hundreds of billions of dollars of Chinese imports, that does not seem to be in the offing. While Ms. Yellen has questioned the efficacy of tariffs, other top officials within the administration see the levies as helpful for encouraging supply chains to move out of China.

The administration is employing both carrots and sticks to carry out a policy of “de-risking” or “friend-shoring” — that is, enticing supply chains for crucial products like electric vehicle batteries, semiconductors and solar panels out of China.

Deteriorating business environments

Companies doing business in China are increasingly worried about attracting negative attention from the government. The most recent target was Micron Technology, a U.S. memory chip maker that failed a Chinese security review in May. The move could cut Micron off from selling to Chinese companies that operate key infrastructure, putting roughly an eighth of the company’s global revenue at risk. In recent months, consulting and advisory firms in China with foreign ties have faced a crackdown.

American officials are growing more concerned with the Chinese government’s use of economic coercion against countries like Lithuania and Australia, and they are working with European officials and other governments to coordinate their responses.

Businesses are also alarmed by China’s ever-tightening national security laws, which include a stringent counterespionage law that took effect on Saturday. Foreign businesses in China are reassessing their activities and the market information they gather because the law is vague about what is prohibited.

“We think this is very ill advised, and we’ve made that point to several members of the government here,” said R. Nicholas Burns, the U.S. ambassador to China, in an interview in Beijing.

In the United States, companies with ties to China, like the social media app TikTok, the shopping app Temu and the clothing retailer Shein, are facing increasing scrutiny over their labor practices, their use of American customer data and the ways they import products into the United States.

Currency

China’s currency, the renminbi, has often been a source of concern for American officials, who have at times accused Beijing of artificially weakening its currency to make its products cheaper to sell abroad.

The renminbi’s recent weakness may pose the most difficult issue for Ms. Yellen. The currency is down more than 7 percent against the dollar in the past 12 months and down nearly 13 percent against the euro. That decline makes China’s exports more competitive in the United States. China’s trade surplus in manufactured goods already represents a tenth of the entire economy’s output.

The renminbi is not alone in falling against the dollar lately — the Japanese yen has tumbled for various reasons, including rising interest rates in the United States as the Federal Reserve tries to tamp down inflation.

Chinese economists have blamed that factor for the renminbi’s weakness as well. Zhan Yubo, a senior economist at the Shanghai Academy of Social Sciences, said the decline in the renminbi was the direct result of the Fed’s recent increases in interest rates.

At the same time, China has been cutting interest rates to help its flagging economy. The interest rate that banks charge one another for overnight loans — a benchmark that tends to influence all other interest rates — is now a little over 5 percent in New York and barely 1 percent in Shanghai. That reverses a longstanding pattern in which interest rates were usually higher in China.

The Fed’s rate increases have made it more attractive for companies and households to send money out of China and invest it in the United States, in defiance of Beijing’s stringent limits on overseas money movements.

China pledged as part of the Phase 1 trade agreement with the United States three years ago not to seek an advantage in trade by pushing down the value of its currency. But the Biden administration’s options may be limited if China lets its currency weaken anyway.

Global debt

China has provided more than $500 billion to developing countries through its lending program, making it one of the world’s largest creditors. Many of those borrowers, including several African nations, have struggled economically since the pandemic and face the possibility of defaulting on their debt payments.

The United States, along with other Western nations, has been pressing China to allow some of those countries to restructure their debt and reduce the amount that they owe. But for more than two years, China has insisted that other creditors and multilateral lenders absorb financial losses as part of any restructuring. That has slowed the loan relief process at a moment when millions of people in developing countries are facing food insecurity and risk being thrown deeper into poverty.

In June, international creditors including China agreed to a debt relief plan with Zambia that would provide a grace period on its interest payments and extend the dates when its loans are due. The arrangement did not require that the World Bank or International Monetary Fund write off any debts, offering global policymakers like Ms. Yellen hope for similar debt restructuring in poorer countries.

Human rights and national security issues

Tensions over national security and human rights have created an atmosphere of mutual distrust and spilled over into economic relations. The flight of a Chinese surveillance balloon across the United States this year deeply unsettled the American public, and members of Congress have been pressing the administration to reveal more of what it knows about the balloon. Mr. Biden’s recent labeling of China’s leader, Xi Jinping, as a “dictator” also rankled Chinese officials and state-run media.

American officials continue to be concerned about China’s human rights violations, including the suppression of the democracy movement in Hong Kong and the detention of mainly Muslim ethnic minorities in the Xinjiang region of northwestern China. A senior Treasury Department official, speaking on the condition of anonymity before Ms. Yellen’s trip, said the United States had no intention of shying away from its views on human rights during the meetings in China.

Chinese officials continue to protest the various sanctions that the United States has issued against Chinese companies, organizations and individuals for national security threats and human rights violations — including sanctions against Li Shangfu, China’s defense minister. The Chinese government has cited those sanctions as a reason for its rejection of high-level military dialogues.

Source: The Newyork Times

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According to reports citing analysts, July will be a “key policy window” for Chinese markets, with investors hoping for policies that can lead to credit expansion. Beijing’s typical playbook of using large-scale stimulus to boost demand may however prove to be ineffective at this time, having led to massive oversupply in property and industry, and surging debt levels among local governments.

What exactly is the problem?

China is facing a slew of issues including sluggish consumer spending, a crisis-ridden property market, flagging exports, record youth unemployment and towering local government debt. The impact of these strains is starting to reverberate around the globe, impacting everything from commodity prices to equity markets. The risk of Fed hikes tipping the US into recession has also heightened the prospect of a simultaneous slump in the world’s two economic powerhouses.

What are the latest updates?

• China and Hong Kong stocks notched small gains on Tuesday as investors bet the country would take more measures in July to shore up its economy.
• The National Development and Reform Commission – China’s top economic regulator – has pledged to tackle issues faced by enterprises and create a better development environment for the private sector.
• China’s central bank has continued to lend support to prevent the yuan from weakening too fast and too far. 
• China’s yuan finished the domestic session at a one-week high against the dollar on Tuesday as the People’s Bank of China (PBOC) set a stronger-than-expected official midpoint rate. In addition, major state banks lowered their dollar deposit rates for the second time in a month.
• “While it may take time to prepare the deployment of a massive stimulus package to mitigate under-delivery risk until the Politburo meeting at end-July, imposing a yuan fixing counter-cyclical factor to buy some time maybe a feasible policy option,” said Ken Cheung, chief Asian FX strategist at Mizuho Bank, referring to the much strengthened guidance rate.
• Chinese firms’ dollar-bond issuance hit the lowest level in a decade during the second quarter, and there are few near-term catalysts to reverse the trend as cheap onshore borrowing costs and economic uncertainty persist.
• Chinese President Xi Jinping’s elevation of a long-serving technocrat as the central bank’s top Communist Party official also signals that policy makers will avoid any drastic shifts for now as the world’s second-biggest economy struggles to regain momentum.

Source: Live Mint

The post China’s Economic Recovery Flounders Amid Debt, Property Slump and More – is a Major Government Stimulus Likely? appeared first on Policy Print.

Gjenero told Xinhua that he applauded French President Emmanuel Macron’s push for “strategic autonomy” away from the United States.

Most Europeans see China as “a necessary partner,” according to the latest poll by the European Council on Foreign Relations.

“It is important that Europe does not deviate from this, that it does not change its attitude towards China under the American pressure,” Gjenero said.

China was the largest source of EU imports and the third-largest buyer of EU goods in 2022, with total bilateral imports and exports reaching 856.3 billion euros (959.96 billion U.S. dollars), according to Eurostat.

The EU and China should establish “a relationship of understanding and mutual trust,” Gjenero said.

In April, European Commission President Ursula von der Leyen said that China’s international and economic status, as well as Europe’s own interests, make it all the more important for Europe to properly manage its relations with China.

Europe must “carve out our own distinct European approach that also leaves space for us to cooperate with other partners,” she added. 

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From January to May 2023, a total of 268.7 billion yuan (about 37.78 billion U.S. dollars) in loans had been extended by the bank to build railways, roads, airports and other transport facilities.

The bank also increased financial support for the construction of charging piles and related power grid networks, among others.

The bank said it will continue to support the development of a modern transportation system, provide higher quality financial services, and fulfill its social responsibilities. 

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