The Month in U.S. - China Relations (June 2018) 中美关系月报

June kicked off with the annual Shangri-La Dialogue (SLD), a security forum in Singapore where the South China Sea, North Korea, and terrorism dominated discussions. Although U.S. Secretary of Defense Jim Mattis promised a more active U.S. presence in the Indo-Pacific, after the SLD questions remained over U.S. Asia policy and America’s commitment to the region. Coverage of this year’s SLD was overshadowed by the highly-anticipated Trump-Kim summit (Last year’s meeting was upstaged by President Trump’s withdrawal from the Paris Climate Agreement). During the summit, the United States carried out a simultaneous act in Taipei: the opening of the American Institute in Taiwan’s (AIT) new office. The upgrading of AIT, an American non-profit organization tasked with maintaining unofficial ties between the U.S. and Taiwan , is viewed by many, especially in Taiwan, as a physical symbol of America’s commitment to the Taiwanese people. “I offer you this [building], a tangible symbol that the United States is here to stay,” said  AIT director Kin Moy. Although the Trump Administration refrained from sending a cabinet-level official to the ceremony, Beijing lodged an official protest, urging “…the U.S. to abide by its pledge to China and correct its mistake to avoid harming China-U.S. relations and peace in the Taiwan Strait.” Threading the cross-strait needle will become even harder for a Washington managing a trade war with Beijing.

Sandy Pho

Senior Program Associate

Kissinger Institute on China and the United States

Major Issue Tracker

China’s Global Influence

All eyes on Xi, Putin and Modi at SCO talks in Qingdao (June 9): The Hindu reports that “Big Three” of China, Russia and India — President Xi Jinping, President Vladimir Putin and Prime Minister Narendra Modi — are expected to define the course of the Shanghai Cooperation Organization (SCO). Related: Xi Jinping Awards Vladimir Putin with ‘Medal of Friendship’

Fraying Australia and China relations Face Testing Times in Canberra (June 17): Australia’s relationship with top trading partner China faces a testing two weeks as Canberra prepares to pass laws designed to limit Beijing’s influence in domestic affairs amid pressure on some of its fastest growing exports…Read More>>

North Korean Leader Kim Jong Un Meets with Xi Jinping in Beijing (June 19): North Korean leader Kim Jong Un and Chinese President Xi Jinping met in Beijing for their first face-to-face talks since Kim's historic summit with US President Donald Trump in Singapore on June 12. The two leaders held a bilateral meeting after a welcoming ceremony for the North Korean leader…Read More>>

PNG Prime Minister Peter O'Neill Visits Beijing to Sign One Belt, One Road Trade Deal (June 20): Papua New Guinea will join East Timor as the second Pacific island nation to sign up to the initiative, which aims to expand Chinese economic influence by enhancing trade routes across the world…Read More>>

Taiwan's Tsai urges world to stand up to China (June 25): Taiwan's President Tsai Ing-wen called on the international community to "constrain" China by standing up for freedoms, casting her island's giant neighbor as a global threat to democracy…Read More>>

In Europe's east, a border town strains under China's Silk Road Train Boom (June 26): As reported by Reuters, the network remains unprofitable and heavily supported by subsidies, but Chinese city authorities have launched new services with fervor after it was subsumed under the four-year-old Belt and Road initiative. Related: How China Got Sri Lanka to Cough Up a Port (subscription)

Australia to Pass Foreign Interference Laws amid Rising China Tensions (June 28):  Australia is expected to pass legislation aimed at preventing interference by foreign governments, a move likely to further stoke tensions with major trading partner China…Read More>>

U.S. Asia Policy

US moves to justify sail-by operations in South China Sea(June 4): As reported by Defense News, a senior U.S. Navy officer has pushed back against suggestions at a regional security summit that freedom of navigation operations in the South China Sea have been ineffective.

U.S. State Department Warns Citizens to Beware Mysterious Sonic Illness (June 8): The U.S. State Department issued a health warning to citizens in China on Friday after a mysterious brain illness resulted in several diplomats and their families evacuating the country…Read More>>

U.S. Unveils an Office in Taiwan, but Sends No Top Officials (June 12): The United States unveiled its unofficial embassy in Taiwan’s capital on Tuesday, holding a low-key ceremony that signaled its support for the self-governing island while also trying to avoid a bigger clash with China, which claims Taiwan as its territory…Read More (subscription)

Former U.S. Diplomat Warns China Is Emulating Russian Political Interference (June 20): Victoria Nuland told the Senate intelligence committee on, "Other countries and malign actors are now adapting and improving on Russia's methodology, notably including China which now runs disinformation campaigns and influence operations in Taiwan, Australia and other neighboring countries"…Read More>>

Southeast Asia and the South China Sea

Chinese Missile Launchers Reappear on Disputed South China Sea Island (June 11): A series of Chinese missile systems have reappeared on a disputed island in the South China Sea, days after satellite imagery appeared to show they had been removed. But in new intelligence analysis released Monday, the organization said the weapons had reappeared on Woody Island on the Paracel island chain…Read More>>

American Student Detained in Vietnam after Protests (June 17): An American citizen was detained in Vietnam while protesting a proposed economic zone law that could clear the path for Chinese investors. William Nguyen, 32, from Houston "was beaten and dragged into the back of a police truck" on June 10 in Ho Chi Minh City, his family said in a statement…Read More>>

Technology, Surveillance, and Espionage

GOP Congressmen Launch ‘Foreign Agent’ Probe Over NRDC’s China Program (June 6): The environmental group, which has sued the Trump administration over its climate policy rollbacks, also works on clean energy and pollution issues in China…Read More>>

ZTE chairman apologizes after agreeing to pay $1 billion fine to US (June 8): ZTE's chairman apologized Friday to staff and customers for the company's past behavior after the Chinese telecom giant struck a deal this week to pay a $1 billion penalty to the US…Read More>

In China Trade War, Apple Worries It Will Be Collateral Damage (June 18): In a trade and technology showdown between the United States and China, Apple and Mr. Cook have a lot to lose. With 41 stores and hundreds of millions of iPhones sold in the country, there is arguably no American company in China as successful, as high-profile and with as big a target on its back…Read More (subscription)>>

Chinese island may lift web censorship to lure tourists (June 22): China's Hainan island has proposed allowing foreign visitors access to censored websites such as YouTube and Facebook, a double standard that has raised cries of indignation from internet users…Read More>>

Elaborate Phone Scams Targeting Chinese Speakers in the U.S. (June 26): First reported in China a few years ago, scams have recently spread to the US, Canada and Australia, where they target Chinese immigrants, students and people with Chinese surnames…Read More>>

Soft Power, Media, and Censorship

As China Censors 'Tank Man' Anniversary, Protestors Re-enact Iconic Demonstration near Tiananmen Square(June 4): As reported by USA Today, Chinese cartoonist known as Badiucao launched a campaign calling for performances honoring Tank Man around the world, donning his black-and-white outfit and standing on a raised platform to connect the moment's legacy to current events. Related: Jogging Through Tiananmen Square: What happens when Facebook Meets China’s censorship regime?

How a Chinese Manuscript Written 2,300 Years Ago Ended Up in Washington (June 8): For decades, the ancient document, known as the Chu Silk Manuscript, has fascinated people seeking an understanding of the origins of Chinese civilization. However, it has been hidden from public view because of its fragility — and the uncertain circumstances by which it ended up in the United States…Read More (subscription)>>

Video Game Corporation Valve will officially launch Steam Digital Shop in China (June 11): The plan, as reported by Verge, was announced in conjunction with Perfect World, a Shanghai-based company that Valve previously worked with to distribute local version of Dota 2 and Counter-Strike: Global Offensive.   It will likely also mean that the Steam store will be subject to Chinese censorship

After Ivanka Trump Quotes 'Chinese Proverb,' A Hunt For The Proverbial Author (June 12): On the eve of her father's meeting with North Korean leader Kim Jong Un, Ivanka Trump seemed to be calling on her inner Yoda as she tweeted: "Those who say it cannot be done, should not interrupt those doing it – Chinese Proverb"… Read More>>

Russia, China and the New Red Scare (June 22): Amid America's fractious political landscape, where cross-party trust is all but absent and bombast seems the currency of the day, concern is growing that wariness about foreign influence from Russia and China is morphing into paranoia…Read More>>

Academia, Education and Law

FBI Statement:  Student Visa Integrity: Protecting Educational Opportunity and National Security (June 6)

U.S. University Unveils New Program to Attract Chinese Students (June 11): The University of New Hampshire has unveiled a new program designed to attract Chinese students with high scores on the gaokao national exam in China…Read More>>

US Supreme Court Rules Against Chinese Vitamin C producers in Antitrust Case (June 15): The justices said US courts were not bound by China’s assertion that the vitamin makers, who are accused of price-fixing, were only following their country’s laws…Read More>>

Congress wants Department of Education to investigate Chinese research partnerships on American campuses (June 20): 26 American lawmakers want Education Secretary Betsey DeVos to investigate the Huawei Innovation Research Program and other programs through which Huawei partners with institutes of higher education across the country…Read More (subscription)>>

ZTE Could Help Confucius Institutes Become Surveillance Hubs (June 27): As reported by the Daily Beast, the two organizations have hosted each other’s visiting delegations, sponsored joint events, and ZTE has provided equipment and training for the Confucius Institutes in countries from Cuba to Zambia.  

Trade and Economic Relations

US-China Tariffs:

• USTR Issues Tariffs on Chinese Products in Response to Unfair Trade Practices (June 15)
• China Announces Retaliatory Tariffs on $34 Billion worth of US goods, including Agriculture Products (June 15)
• White House's Navarro: No Progress After Trade Talks with China (June 19)
• White House Office of Trade & Manufacturing Policy Report: “How China’s Economic Aggression Threatens the Technologies and Intellectual Property of the United States and the World” (June 19)
• Chinese Central Banker Calls for Calm as Trade War Sparks Stock Sell-Off (June 19)

Google to invest $550 million in Chinese e-commerce giant JD.com (June 18): The two companies described the investment announced on Monday as one piece of a broader partnership that will include the promotion of JD.com products on Google’s shopping service…Read More>>

Trump heads to Wisconsin to Tout A New Foxconn Plant (June 28): As reported by the Associated Press, the ceremonial groundbreaking for a massive $10 billion Foxconn factory complex in Wisconsin was supposed to be evidence that the manufacturing revival fueled by President Donald Trump's "America First" policy is well underway. Related: America and the Foxconn Dream

If You Read/ Watched Nothing Else in June…

The fine writing and film/videography on U.S.-China relations published each month far exceeds the assimilating capacity of any institution.  It would be ridiculous to feature “the best” efforts of the past 31 days, but KICUS would like to highlight the following work nonetheless:

Op-Eds and Commentary

Beijing Wants to Rewrite the Rules of the Internet (Samm Sacks, The Atlantic)

Double Dissidents (Xiaoyu Lu, LARB China Channel)

Ascendance of China and Russia marks loss of American leverage (Jane Harman, The Hill)

Remarks

Remarks on America's Economic Revival (Mike Pompeo, U.S. Secretary of State)

Reports

China's Use of Coercive Economic Measures (Peter Harrell, Elizabeth Rosenberg, Edoardo Saravalle Center for a New American Security)

Arrested Development: Chinese FDI in the US in 1H 2018 (Thilo Hanemann, Rhodium Group)