Xi’s Hangzhou agenda

shutterstock_197785709

While President Xi remains huddled with China’s top leaders in Beidaihe for the Communist Party’s summer retreat, in Beijing senior officials have begun trying to shape the agenda for next month’s G20 summit in China’s eastern city of Hangzhou. On Monday, public comments by two senior government ministers stressed that as this year’s host Xi wants to focus on the subject of global economic growth.

Vice Finance Minister Zhu Gungyao emphasized the need for the G20 to reaffirm the importance of global trade and investment and deplore protectionism: “We really do need to make sure that the people, the public, benefit from economic development and growth,” Zhu said. “If people don’t feel like they are beneficiaries of economic development, if they don’t think their lot in life is improving, that’s when they start getting all kinds of ideas.” (Ideas? Like voting for Donald Trump, perhaps? Or withdrawing from the European Union?)

Meanwhile, China’s Vice Foreign Minister, Li Baodong, said leaders at the Sept 4-5 meeting shouldn’t get sidetracked by issues unrelated to economics–for example, competing sovereignty claims in the South China Sea. “The G-20 summit in Hangzhou is about the economy,” he said. “The consensus is to focus on economic development and not be distracted by other parties.”

Sticking to economics is usually a safe bet at global gatherings. But this year, it might actually court discord. After all, growth isn’t necessarily a subject that plays to China’s strengths these days. Continue reading “Xi’s Hangzhou agenda”

Beijing’s cyber-protectionism

An extraordinary coalition of business federations from the United States, Europe and Japan teamed up this week to send Beijing a message: back off of proposed cyber-security regulations that would force foreign firms to store data in China and surrender information and technology to Chinese security inspectors.

The business groups, which included the US Chamber of Commerce, BusinessEurope and Japan’s Keidanren, decried the new rules in a letter sent to Chinese premier Li Keqiang. Other signatories included more than 40 global industry groups representing financial services, technology and manufacturing sectors, and business lobbies from Australia, Mexico and Switzerland.

The petition was a response to draft regulations, announced by the China Insurance Regulatory Commission last month, requiring foreign insurers to use Chinese hardware and software to store and encrypt data. But global firms also are fuming over new banking regulations that would require them to hand over key technologies such as source codes and encryption algorithms to the Chinese government. (Beijing has delayed implementing those rules after protest from Washington.)

China insists it needs tighter controls on cyber-security and the Internet to guard against terrorism. Global companies aren’t buying it. The letter casts the regulations as thinly disguised protectionism and warns they will further isolate China from the global digital economy. The new provisions would “have no additional security benefits but would impede economic growth and create barriers to entry for both foreign and Chinese companies,” the letter declares. Continue reading “Beijing’s cyber-protectionism”

Nuclear power vs people power

China’s leaders often are portrayed in West as all-powerful dictators. I can’t count the number of times I’ve heard American business executives assert that the secret of China’s rapid economic development is the ability of its communist overseers to steamroll domestic dissent. And yet the outcome of anti-nuclear protests this week in Lianyungang, a coastal city about 300 miles north of Shanghai, suggests the reality is a lot more complicated. Continue reading “Nuclear power vs people power”

Choppy water

China’s has been making waves this week, and not just in the swimming pools of Rio.

Over the weekend, the Japanese government charged China with stirring up trouble in the East China Sea by dispatching more than 200 fishing boats into waters near islands Japan occupies but both countries claim.

On Monday, the New York Times published a series of photos collected and analyzed by the Center for Strategic Studies that appears to show China has built reinforced aircraft hangars on the three reefs it controls in disputed waters in the South China Sea. CSIS analysts say the hangars are large enough to accommodate military aircraft–bombers, refueling tankers and transport planes–which would seem to contradict Chinese president Xi Jinping’s September promise to President Obama that “China does not intend to pursue militarization” of the islets. Continue reading “Choppy water”