The Month in U.S.-China Relations 中美关系一个月 (November 2017)

The Kissinger Institute is in China for discussions on U.S.-China relations post 19th Party Congress and Trump’s first year in office. Great time to be in smoggy Beijing, which, to be fair, has offered beautiful azure skies so far.

After 12 days of red carpet rollouts and elbow rubbing with Asia’s elites, President Trump returned to Washington on a high note. No trade war with China—check. No nuclear war with North Korea—check. The President even got to plug his “America First” platform on a global stage, making clear that the United States would not “be taken advantage of anymore” on trade—check. For Trump supporters, the trip was a foreign policy success. Trump’s critics saw something completely different. They mourned the death of U.S. leadership as illustrated in headlines such as This is How a Superpower Commits Suicide and Trump is Ceding Global Leadership to China. Although Trump struck a positive note with Chinese President Xi Jinping, the trip highlighted the issue that will define Sino-U.S. relations for years to come: a struggle between two competing governing models and global visions. Here in the United States, the Kissinger Institute has noticed an uptick in commentary focusing on the competitive aspects of the relationship. This line of thinking is playing out in the policy arena, as illustrated in Senator Cronyn’s recent Foreign Investment Risk Review Modernization Act and Trump’s refusal to grant China market economy status in the WTO.

In Xi’s marathon speech at October’s Communist Party Congress, he proclaimed China’s rightful return to the center of the world and put forth China’s governance model (socialism with Chinese characteristics) as “a brand-new choice for … countries … that wish to accelerate development and maintain their own independence.” It remains to be seen whether Beijing will actively promote the China model abroad, but there is no doubt about Xi’s ambitious agenda. In this New, Xi-centered Era, China is more confident and it intends to do things Xi’s way, without any American back talk.

Sandy Pho

Senior Program Associate

Kissinger Institute on China and the United States

Major Issue Tracker

China as an Emerging Superpower

China Won (November 2): Ian Bremmer of The Eurasia Group argues in this Time piece, “…if you had to bet on one country that is best positioned today to extend its influence with partners and rivals alike, you wouldn’t be wise to back the U.S. The smart money would probably be on China.” There’s a noticeable uptick of “America is a loser/China is a winner” articles lately:

China Takes Major Step Toward Setting up National Carbon Trading Program (November 2): The registry issues, tracks and verifies carbon emission allowances and credits, and is the crucial cornerstone of the emissions trading system. The carbon trading exchange is the platform where buyers and sellers trade allowances and credits…Read More>>

China Wants to Certify Food Safety in Global Market (November 4): Despite its abysmal reputation in food safety, China now thinks it deserves a stronger say in certifying the safety of food in international trade…Read More>>

South Korea, China Agree to Manage North Korea Issue Peacefully (November 11): South Korean President Moon Jae-in and Chinese President Xi Jinping met on the sidelines of the APEC Summit and agreed to quickly normalize bilateral exchanges in all sectors and reiterated their commitment to end a year-long standoff over the deployment of a U.S. anti-missile system. Related: China and South Korea: Examining the Resolution of the THAAD Impasse; China Partially Lifts Ban on Group Tours from South Korea; Lotte Gets Approval for China Property Project as ROK-China Tensions Ease; Why South Korea’s Promises on THAAD and a U.S.-Japan Alliance are so Important to China; China Says it Hasn’t Dropped its Plan for Korean De-escalation Despite Trump.

Alibaba’s Singles’ Day Goes Global with Record $25 Billion in Sales (November 12): Citigroup Inc. has predicted transactions will rise by more than 30 percent to 158 billion yuan this year. While that’s only half the growth rate last year, the event still dwarfs others such as Black Friday and Cyber Monday…Read More>>

China to Send Special Envoy Song Tao to North Korea (November 15): Shorty after President Trump’s visit to China, Beijing sent a senior Communist Party official, Song Tao, to Pyongyang with the official task of reporting on the recent Party congress. Related: Trumps Says China’s Envoy Had ‘No Impact’ on North Korea Missile Program.

China’s Deep Ties to Zimbabwe Could Grow after Mugabe Era (November 20): Under Robert Mugabe's decades-long rule over Zimbabwe, China grew into one of the African nation's biggest investors, trading partners and diplomatic allies. Now, as Zimbabwe appears on the verge of its first transition of power since independence, Beijing is poised to be among the biggest winners.

From Rail and Airports to its First Overseas Naval Base, China Zeroes in on Tiny Djibouti (November 21): Djibouti’s exports to China – including leather, salt and cement – totalled just US$7,500 in 2009. That compares to China’s exports to Djibouti, such as vehicles and electronic equipment, which reached US$20.7 million that year. But the relationship between the two nations goes far beyond trade.

U.S. Rebalance to Asia

Trump in Asia (November 3-12): According to the White House, Trump scored a series of trade deals and reinforced regional unity against North Korea while in Asia. All in all, Trump was able to forge closer relationships with Japanese Prime Minister Shinzo Abe and South Korean President Moon Jae-in. He also struck a positive note with Chinese President Xi Jinping, who just emerged from the 19th Communist Party Congress more powerful than ever.

Related: Major Consensus Reached at Xi-Trump Summit; Remarks by President Trump at Business Event with President Xi of China; Fact Check: U.S.-China Trade Package Mostly About Symbolism; As Trump an Xi Jinping Meet in China, an Iowan is the Bridge Between Them; Trump’s Trade Boasts in Asia Mask Looming China Problem; U.S. Rebuffs China’s Charm Offensive, Edging Closer to Trade War (subscription).

Congress Trying on its Foreign Policy Hat as Trump Prepares for China Visit (November 6): Senator Marco Rubio and Representative Chris Smith, Chair and Cochair of the Congressional-Executive Commission on China, urged Trump prior to his China trip to articulate a “bold vision for advancing American interests…in the vitally important Indo-Pacific region”. Congressional foreign policy just as vague as the White House’s it seems. 

Trump Says He and China's Xi to Try to End Opioid Crisis (November 9): China’s drug control agency disputed Trump’s claim that most of the synthetic drug fentanyl at the heart of the U.S. opioid crisis was produced in China…Read More>>

Diplomatic Initiative Revived to Counter China’s Growing Influence (November 14): According to the Financial Times (subscription), officials from the U.S., Japan, Australia and India met on the sidelines of the ASEAN summit in Manila to restart the “quad”, a diplomatic initiative set up a decade ago to counterbalance China’s growing power in the region. None of the four mentioned China in subsequent statements but each touched on issues likely to make Beijing nervous. Related: Indo-Pacific Alliance Could End Prematurely; The Rise, Fall, and Rebirth of the ‘Quad’.

Donald Trump's Menacing Talk on North Korea is Leaving the U.S. Isolated (November 30): Reacting to North Korea’s November 29th missile test, Trump’s ambassador to the UN, Nikki Haley, upped the ante again, pinning blame wholly on Kim’s shoulders. “If war does come, it will be because of continued acts of aggression like we witnessed yesterday … If war comes, make no mistake, the North Korean regime will be utterly destroyed,” she said. Related: Readout of President Donald J. Trump's Call with President Xi Jinping of the People's Republic of China.

Military

Military Pledges Total Loyalty to Xi (November 6): According to China Daily, The Chinese military will be absolutely loyal, pure, reliable, and resolutely follow the orders of Central Military Commission Chairman Xi Jinping, China's highest military authority has said.

China-U.S. Military Exercise to Enhance Rescues (November 20): The joint exercise between the Chinese and the U.S. militaries were held at Camp Rilea Armed Forces Training Facility of the Oregon Army National Guard in Warrenton, Oregon and involved more than 200 people from both sides. 

Southeast Asia and the South China Sea

Philippines’ Duterte Scales Back Building Work in South China Sea (November 8): According to Deutsche Welle, The Philippine president wanted to build on disputed land at the heart of a lucrative shipping route. Pressure from China made him quickly change tack.

‘Better Left Untouched’: Philippines and Vietnam Wary of Trump Offer to Mediate (November 12): US President Donald Trump’s offer to mediate the long-standing territorial disputes in the South China Sea could antagonise Beijing and overshadow his relationship with Chinese President Xi Jinping…Read More>>

Xi’s Globalist Vision Encounters Suspicion in His Own Backyard (November 16): Xi played two seemingly disparate roles in his recent trip to Vietnam and Laos: defender of global commerce and torchbearer for international communism. While the trip presented China as an alternative to a more inward-looking U.S., it also showed the region’s ambivalence to embrace Beijing’s worldview. Related: Xi's Article on China-Vietnam Friendship Hailed in Vietnam; Full Text of Chinese President Xi's Signed Article on Lao Media; China, Vietnam Agree to Deepen Partnership Under New Circumstances.

China Offers Solution for Rohingya Refugee Crisis in Myanmar (November 20): Chinese Foreign Minister Wang Yi outlined a three-point solution that would allow Myanmar and Bangladesh to resolve the situation. The steps included a cease-fire, repatriation of refugees and talks on a long-term solution.

Technology, Surveillance, and Espionage

Eric Schmidt on AI: 'Trust Me, These Chinese People Are Good' (November 1): Eric Schmidt, the executive chairman of Google parent company Alphabet, has warned that China is poised to overtake the U.S. in the field of artificial intelligence (AI). if the U.S. government doesn't act soon. Related: China Scours the Globe for Talent to Transform into World Leader in Artificial Intelligence and Big Data; China and the CIA Are Competing to Fund Silicon Valley’s AI Startups; Qualcomm Invests in Chinese AI Facial Recognition startup SenseTime.

The ACLU Says the FBI is Accusing Chinese-American Scientists of Espionage Because of Their Race (November 1): The lawsuit follows several other instances wherein the FBI has been found to have wrongly targeted Chinese individuals living in the U.S. on suspicions of espionage. These incidents coincide with growing concerns in Washington about state and commercial espionage coming from Beijing…Read More>>

China Requires Security Review for Web Products (November 1): According to China Media Project, the import of the regulation seems to be that any new technology-based information product — of a “public opinion character” (新闻舆论属性), say the regulations — or any key adjustment to such an existing product, must go through a process of “security assessment.” Related: Troubled by Internet Trolling? China May Offer Management Inspiration (Global Times Op-Ed); China to Track Reporters for Fake News.

Facebook, Take Note: In China’s ‘New Era,’ the Communist Party Comes First (November 2): As reported by the Wall Street Journal (subscription), American technology leaders should recognize that China is entering a “new era”. In this era, according to Mr. Xi’s policy blueprint, the Communist Party will be supreme. The bargaining power of foreign tech companies, never high, is likely to dwindle. Related: The Rise of #Xiplomacy and China’s Strategic Narrative. Facebook Blocked Dissident Guo Wengui after the Chinese Government Complained.

‘Grandpa, What are Spies?’ Cartoon Urges Chinese Children to be on Alert (November 7): Videos released last month by the state-run Chinese Society of Education in October are part of an online course to remind youngsters of their duty to safeguard the country…Read More>>

China’s Tencent Takes a 12% Stake in Snapchat Parent Snap (November 8): “(Tencent) buys all sorts of minority investments, and I don’t think we can extrapolate that this means they intend to take over the company,” said Wedbush Securities analyst Michael Pachter. Related: Unmanned AI Police Station to Open in Wuhan, Will Partner with Tencent.

Surveillance Cameras Made by China Are Hanging All Over the U.S. (November 12): According to the Wall Street Journal (subscription), Hikvision (pronounced “hike-vision”) was nurtured by Beijing to help keep watch on its 1.4 billion citizens, part of a vast expansion of its domestic-surveillance apparatus. In the process, the little-known company has become the world’s largest maker of surveillance cameras. It is 42%-owned by the Chinese government.

U.S. Charges Three Chinese Hackers Who Work at Internet Security Firm for Hacking Three Corporations for Commercial Advantage (November 27): The indictment alleges that the defendants conspired to hack into private corporate entities in order to maintain unauthorized access to, and steal sensitive internal documents and communications from, those entities’ computers. 

Media, Soft Power, and Censorship

Katy Perry, Academic Publishers, and Self-Censorship in China (November): China Digital Times Chinese reposted a letter circulating on Weibo which purportedly shows singer Katy Perry’s pledge to behave harmoniously during a prospective Chinese tour.

Outcry as Latest Global Publisher Bows to China Censors (November 1):  Research by the Financial Times (subscription) shows Springer Nature has removed more than 1,000 articles from the websites of the Journal of Chinese Political Science and International Politics, two Springer journals, in the Chinese market. Reuters also reported on this story. Related: Peer Review Boycott of Academic Publications that Censor Content in China; Dude, Where’s my Paper?; China Warns on Overseas Content after Springer Nature Pulls Some Articles.

How the Panda Became China’s Diplomatic Weapon of Choice (November 2): Part of the panda’s clout derives from its international role as a symbol of conservation. Late last year, pandas were officially downgraded from 'endangered' to 'vulnerable'. According to the Financial Times (subscription), Chinese officials were livid about the decision and have been furiously lobbying for a reversal ever since. 

The Long Reach of China’s United Front Work (November 6): According to Gerry Groot writing for The Interpreter, the Chinese Communist Party increasingly feels entitled, obliged even, to extend a form of extraterritoriality to all overseas Chinese, but especially all those who have emigrated or left since 1978. This worries a growing number of people, from intelligence agencies to universities. Our very own Anne-Marie Brady wrote about this in September.

China Reinvents Literature—Profitably (November 7): Last year, 333 million Chinese read fiction written for their phones and other devices, according to government data. Some is written by hobbyists and some by professionals. Increasingly, though, it's hard to tell the difference, as China's "online literature" morphs into a $1.3 billion industry…Read More>>

What Do Chinese People Really Think about Donald Trump? (November 7): The South China Morning Post talked with Beijing resident prior to U.S. President Trump’s state visit. Fei Danyang, a 42-year-old financial analyst thinks Trump is an interesting person but “he is no politician and has big ego...so his honesty is, in a disrespectful way, a bit self-righteous…” Related: China State-Controlled Media Sides with Trump over American 'Fake' Media.

China Enlists Western Media to Spread Its Message  (November 11): As reported in the Wall Street Journal (subscription), Xi, who often calls Western depictions of Chinese society unfair, has stepped up support for co-productions with foreign partners, including documentary tie-ups spotlighting the country’s culture, technological advancements and infrastructure projects. One such feature is “China: Time of Xi,” a three-part documentary produced by Discovery channel’s Asia arm. Related: China State Media Spreads Propaganda Globally Using Facebook, A Platform it Bans at Home.

U.S. Congress Urged to Require Chinese Journalists to Register as Agents (November 15): The 2017 U.S. China Economic and Security Review Commission Annual Report highlighted the rapid growth of the Xinhua news agency and noted that it had several offices in major United States Cities… Read More>>

U.S. Wilderness Becomes New Magnet for Chinese Tourists (November 16): According to Xinhua, in 2016 there were 2.97 million arrivals from China, making China the fifth largest source country in international visits to the United States. Of those arrivals, 1.2 million (about 41 percent) visited national parks and/or monuments.

Disney's 'Mulan' Finds Its Star (November 29): Chinese actress Liu Yifei, also known as Crystal Liu, is set to play the lead in the live-action adaptation directed by Niki Caro…Read More>>

Education and NGOs

Teaching China Humanities Online: A Harvard Graduate Student’s Experience (November 1): Ted Hui, Ph.D. candidate in Harvard’s Department of East Asian Languages and Civilizations, describes his experience creating an online course with HarvardX…Read More>>

19 Academics Resign from Journal Over Alleged Plagiarism (November 10): A paper authored by three Chinese researchers is at the center of the ongoing dispute…Read More>>

Chinese Grads Return Home with Degrees and Disillusionment (November 10): Stricter visa policies in the West and growing career opportunities in China have pulled many sea turtles (Chinese students who study abroad) back to Chinese shores…Read More>>

U.S. Charges Chinese Woman in College Exam Fraud (November 14): Xinyan Wang, a student at Lehigh Carbon Community College in Pennsylvania, on six different occasions since July took college entrance exams under other peoples’ names…Read More>>

Beijing Vies for Greater Control of Foreign Universities in China (November 19): According to the Financial Times (subscription), more than 2,000 education joint ventures between Chinese and overseas Universities have been established since 2003. The Chinese Communist party has ordered foreign-funded universities to install party units and grant decision-making powers to a party official, reversing an earlier promise to guarantee academic freedom

Why a Chinese Communist Party Branch at the University of California, Davis, Was Disbanded (November 20): As reported by the South China Morning Post, a group of visiting Chinese scholars in the United States have dissolved a Chinese Communist Party cell they set up at the University of California, Davis, citing fears about violating U.S. laws. Related: Beijing vies for greater control of foreign universities in China (subscription).

Trade and Economic Relations

Foreign Credit Card Firms Hit Joint-Venture (JV) Obstacle in China Push (November 6): As reported by Reuters, China is pressing foreign payment card companies to form local joint ventures for onshore operations, a move that would counter a pledge on market access Beijing made to U.S. President Donald Trump. Related: China Central Bank Says Foreign Payment Card Firms Not Required to Establish JVs to Enter Local Market.

China's Largest Online Retailer to Buy Montana Beef (November 8): China’s JD.com has signed a deal with the Montana Stockgrowers Association to buy $200 million worth of Montana beef over the next three years and potentially build a $100 million slaughterhouse in the state.

U.S. Lawmakers Introduce Bipartisan Bills on Foreign Investment Amid China Worries (November 8): A bipartisan group of lawmakers in the U.S. Senate and House of Representatives introduced bills in November to toughen U.S. foreign investment rules amid growing concern about Chinese efforts to buy U.S. high-tech companies. Related: CIFIUS Reform and U.S. Government Concerns Over Chinese Investment: A Primer

Trump and Xi Offer competing Visions for Trade (November 10): According to the BBC, Trump gave a defiant address to regional leaders attending the Asia Pacific Economic Cooperation summit in Vietnam, telling them the U.S. would no longer tolerate “chronic trade abuses.” In contrast, President Xi said globalization was irreversible. Related: Full text of President Xi's address at APEC CEO Summit; Remarks by President Trump at APEC CEO Summit.

KFC Still ‘Finger Lickin' Good’ in China (November 10): “Regarded as the earliest entrant, KFC has been one of the most important players and a giant in China’s fast-food market,” said Shirley Lu, a consultant at Euromonitor International. “KFC played a vital role in consumer education at the very beginning, as a result, largely increasing Chinese consumers’ acceptance toward not only fast food but also all kinds of Western-style food”…Read More>>

U.S. Seeks to Deny China Market Economy Status in WTO (November 30): In the 40-page filing seen by the Financial Times, “the U.S. rejects Beijing’s argument that under the 2001 conditions of China’s accession to the WTO it would automatically be considered a market economy 15 years after joining when it faced anti-dumping cases from fellow members”…Read More>>

If You Read/Watched Nothing Else in November…

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 30 days, but KICUS would like to highlight the following work nonetheless:

Three Tips for Becoming a Better China-Watcher (November 6): Eric Hundman writes for SupChina that the best way to understand China is to read Chinese sources. Another tip is to subscribe to email newsletters, such as our very own Month in U.S.-China Relations! You’re one step closer to becoming a better China-watcher.

Op-Eds and Commentary

How China’s Economy is Poised to Win the Future (Ian Bremmer, TIME, November 2)

America Still Holds the Aces in its Poker Game with China (Joseph Nye, Financial Times [subscription], November 2) Response: Aces Now in China’s Hands: Why Nye’s View is Mistaken (Wang Wen, Financial Times [subscription], November 8)

Some Frank Advice for President Xi (John Pomfret, The Washington Post, November 8

Xi’s Pax-Sino Vision (Sandy Pho, The Mark News, November 30)

Articles/Essays

What’s Next for U.S.-China Climate Cooperation? (Canve Wagner and Zou ji, China Dialogue, November 7)

The Meaning of Sharp Power, Christopher Walker and Jessica Ludwig, Foreign Affairs, November 16)

China and the United States are Equals. Now What? (Robert Daly, ChinaFile, November 19)

Keynote

Implications of China’s Growing Power for the U.S. (Senator John Conryn, CSIS, November 14)

Videos

China's 19th Party Congress: Implications for China and the United States (Stape Roy, Robert Daly and Sandy Pho, C-SPAN, November 3)

China's Cyber Celebs (Al Jazeera, November 23)

Report

Avoiding war: Containment, Competition, and Cooperation in U.S.-China Relations (Brookings Institution, November 21)

Podcast

Inside the Secret Back-Channel North Korea Talks (Susan Glaser with Suzanne DiMaggio and Joel Wit, The Global Politico, November 13)