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

As Americans were preparing to elect Donald J. Trump as their next Commander-in-Chief last October, General Secretary Xi Jinping was granted the title of “core leader” of the Communist Party of China (CPC). However, Questions pertaining to Xi’s political strength remain. The addition of “Xi Jinping Thought” to the Party’s Constitution during the 19th Party Congress left no doubt as to who is in charge of the world’s second largest economy. Although short on specifics, General Secretary Xi’s work report offered a blueprint for a more confident and active China both at home and abroad. In this new Xi era, it’s China’s way or the highway; across the Pacific, President Trump’s approval rating dipped to 38 percent this week. According to NBC News, this is the lowest approval rating “in modern times for a president at this stage of his presidency.”

President Trump may find relief from the polls this weekend when he travels to East Asia for 12 days, his longest overseas trip so far. While in Asia, President Trump will participate in regional meetings and bilateral discussions with leaders from Japan, South Korea, China, Vietnam, and the Philippines. President Trump’s top priority in Beijing will be North Korea. I wrote in the April newsletter of the Mar-a-Lago summit that it is unlikely that China will “solve” North Korea to Trump’s satisfaction because China’s interests in North Korea are not fully compatible with America’s. This has not changed. What has changed is that Xi’s grip on power is now unquestioned and his confidence is soaring.

Happy Summiting!

Sandy Pho

Senior Program Associate

Kissinger Institute on China and the United States

Major Issue Tracker

China as an Emerging Superpower

China Preparing to Bypass Russia’s Northern Sea Route in Arctic (October 3): China has been among the biggest users of the Northern Sea Route because it allows Chinese companies to cut 15 days off the shipping time between Europe and Chinese ports. Related: China to Build 5th Antarctic Research Station.

Brazil's Mega Hydro Plan Foreshadows China's Growing Impact on the Amazon (October 5): The government wants to open up the Tapajós basin – an area the size of France – for trade with China. The Brazilian government wants to ramp up exports of soya and meat, particularly to China which accounts for 57% of Brazil’s overseas soya sales…Read More>>

Xi Plans to Turn China Into a Leading Global Power by 2050 (October 17): In a speech that ran for more than three hours at the 19th Party Congress, Xi devoted a significant amount of time defining China’s place in the world, calling for a strong military while also saying it would never seek global hegemony. Related: Xi Opens 19th Party Congress Proclaiming a New Era—His; Xinhua Infographic of Key Points in Xi’s Work Report.

China Threatens U.S. Congress for Crossing its ‘Red Line’ on Taiwan (October 12): The Washington Post (subscription) reported that the Chinese Embassy lodged a formal complaint with leading lawmakers, threatening ‘severe consequences’ for the U.S.-China relationship if Congress passed new laws that would strengthen America’s relationship with Taiwan. Related: China’s Lobbying Against the Taiwan Travel Act Backfires (subscription); Tsai Visits Pearl Harbor Memorial in Honolulu; Taiwan to Boost Defense Spending, U.S. Concerned Over Possible Military Imbalance.

China Could Take Bigger Role in UNESCO After U.S. Withdrawal (October 13): According to the South China Morning Post, China is the third largest contributor to UNESCO, providing 7.9 percent of funding to the organization. The United States notified UNESCO of its intention to withdraw from the organization on October 12th. Related: China Moves in as U.S. Pulls Back from Global Institutions (subscription); China Urges U.S. Not To Withdraw from Paris Accord on Climate Change Ahead of Trump Visit.

China, South Korea Agree to Mend Ties after THAAD Standoff (October 30): The dispute has been devastating to South Korean businesses that rely on Chinese consumers. Related: Will THAAD Feud be Settled? Seoul-Beijing Ties Reach ‘New Starting Point’; Moon Seeks Detente With China, North Korea Before Trump Visit.

U.S. Rebalance to Asia

Trump Asia Visit (11/3-14)

• U.S. Scolds China for Distorting Market Ahead of Trump’s Asia Trip (October 30).
• U.S. Business Group Worries Trump Unprepared for Commercial Talks with China (October 31)

Rex Tillerson at the Breaking Point (October 16): A New Yorker profile of Secretary of State Tillerson that includes some details on China policy. Related: Tillerson Remarks on ‘Defining Our Relationship with India for the Next Century.

Donald Trump Congratulates Xi Jinping on ‘Extraordinary Elevation’ after 19th Party Congress (October 26): In a phone call to the Chinese General Secretary, the two presidents discussed North Korea and trade. Trump is to make a state visit to China in early November…Read More>>

Military

U.S. Intelligence Sees China's Military Expanding Bases Globally (October 5): China’s first overseas military base in the small African country of Djibouti is “probably the first of many” the country intends to build around the world, which could bring its interests into conflict with the U.S., according to American intelligence officials.

China Has Practiced Bombing Runs Targeting Guam, U.S. Says (October 31): Beyond the well-publicized military build up on man-made islands in the South China Sea, China has built up its fleet of fighters to the extent that it operates a daily, aggressive campaign to contest airspace over the East China Sea, South China Sea and beyond, U.S. military officials in the region said…Read More>>

Southeast Asia and the South China Sea

China Gives Guns to Philippines to Show It's a Friend, Not a Foe (October 5): According to Reuters, The rifles, worth about $3.3 million, will all go to the Philippine National Police (PNP), which needs to fill a shortfall of guns after some U.S. legislators blocked the sale of about 26,000 M4 rifles to the police last year. Related: What’s in the New China Military Aid to the Philippines? (subscription); With Mattis Trip To Philippines, Reminders Of Waning U.S. Influence In Region; Readout of Secretary Mattis’ Meeting with Philippine President Duterte; Alejano Claims Chinese Forces Inching Closer to Pag-asa.

U.S. Warship Sails Near Islands Beijing Claims in South China Sea (October 10): This was the fourth Freedom of Navigation Operation in the South China Sea carried out by the United States this year…Read More>>

As Anti-U.S. Feeling Grows in Cambodia, China Cashes in (October 15): China funnels staggering amounts into Cambodia in exchange for loyalty: military uniforms, vehicles, loans for equipment and a training facility in the southern reaches of Cambodia…Read More>>

China-ASEAN Joint Military Exercises (October 24): China and the Association of Southeast Asian Nations plan to deepen their military relations and will go ahead with a joint maritime exercise proposed by Beijing…Read More>>

China’s Mekong Plans Threaten Disaster for Countries Downstream (October 27): As Reported by Foreign Policy (subscription), China’s expanding hydropower projects have drawn concern from Southeast Asian states that border the Mekong, and may pose risky consequences for downstream communities. Related: Life on Mekong Faces Major Threats as Dams Begin to Rise

Technology, Law Enforcement, and Espionage

Research Claims CCLeaner Attack Carried Out by Chinese-Linked Group (October 2): The findings are significant because if accurate it provides partial evidence that China is once again spying on private American companies after having agreed to cease the practice in 2015 after an arrangement was struck between former U.S. President Barack Obama and Chinese President Xi Jinping.

U.S., China, Hold Law Enforcement and Cybersecurity Dialogue (October 6): Topics discussed by the Department of Justice and the Ministry of Public Security included repatriation, cybercrime, counter-narcotics, and fugitives…Read More>>

Baidu Opens an Office in Seattle (October 9): The office gives the Beijing-based Internet powerhouse an additional U.S. outpost to expand its reach in artificial intelligence and the cloud…Read More>>

China’s AI Awakening (October 10): Will Knight argues in MIT Technology Review: The West shouldn’t fear China’s artificial intelligence revolution. It should copy it.

U.S. and China Department Heads Discuss Cybersecurity and Law Enforcement Cooperation (October 13): This was the first bilateral Law Enforcement and Cybersecurity Dialogue between the two countries and is one of the four dialogues that Presidents Trump and Xi agreed to in their meeting in Mar-a-Lago…Read More>>

Qualcomm Seeks China iPhone Ban, Expanding Apple Legal Fight (October 13): Qualcomm filed the suits in a Beijing intellectual property court claiming patent infringement by Apple and seeking injunctive relief…Read More>>

Chinese Government Pursues Real Estate Tycoon through U.S. Casino Magnate (October 22): CEO of Wynn Resorts, Steve Wynn, who maintains substantial holdings in the Chinese region of Macau, hand-delivered a letter to President Donald Trump written by the Chinese government urging the return of businessman Guo Wengui, who seeks U.S. asylum.

Related: Guo Wengui Tweets Photo of Him and Steve Bannon; Think Tank Cancels Talk by Guo Wengui Under Pressure from Beijing.

Apple’s Cook, Facebook’s Zuckerberg meet Xi Jinping in Beijing (October 30): The tech executives met the Chinese president ahead of a key iPhone launch and amidst a push on Facebook’s part to gain access to China’s user market…Read More>>

Media, Soft Power, and Censorship

How Millennials are Changing China’s Travel Industry (October 2): The days of chartered European bus shopping tours are waning. According to SupChina, many Chinese travelers now want unique cultural experiences: rain forest tours in China’s Yunnan, trips tracking animal migration through Africa, and excursions to bask under the glow of the aurora borealis. Related:  The New Generation of Chinese Collectors Shaking up the Art World.

Hollywood Finds Chinese Cinemas Fudging Box-Office Figures (October 3): According to The Wall Street Journal (subscription), auditors at PricewaterhouseCoopers LLP working on behalf of the Motion Picture Association of America (MPAA) concluded that ticket sales in China were underreported by about 9% last year. That translates into at least $40 million in lost revenue for the six Hollywood studios that make up the MPAA.

Pac-12 Conference Signs Deal With Alibaba Group For China Distribution (October 5): According to Forbes, Alibaba will have the ability to distribute 175 live Pac-12 Networks events, including football and men's basketball, annually throughout China. Caixin also reported on this story. Related: Golden State Warriors are Gigantic in China

Guggenheim’s Much-Contested China Exhibition Holds Up An Unexpected Mirror to America Instead (October 7): After petitions and internal debate, the New York museum removed three pieces of Chinese Art originally included…Read More>>

Adopted as a Toddler from China, Morgan Hurd is Now America’s Great Gymnastics Hope (October 7): Morgan, who was born in Guangxi, China and adopted by Sherri Hurd of Delaware, is now considered the next generation of elite performers in the United States. Related: Netizens Split on Chinese-American Gym Champ.

Google is Hoping a Chinese-American Rapper Can Help it Break Back into China (October 16): Google released an ad featuring Chinese-American rapper MC Jin using Google Translate in Shanghai. Related: Google Has a New Plan for China (and It's Not About Search).

Education and NGOs

Why Chinese Students Are Being Drawn to America’s Faith-Based Universities (October 14): The University of Notre Dame’s Thomas Burish discusses the rising tide of Chinese students choosing the U.S. for their university education, why religion can aid learning, and differences in classroom approach across the seas with the South China Morning Post.

Chinese Government Intrusion into Western Universities Sparks Push for Collective Action (October 15): Discussions have begun in diplomatic and security circles about whether the Five Eyes intelligence partners should respond collectively to the threat, so there are no "weak links" which can be exploited…Read More>>

China’s Tencent Leads Funding for U.S. Educational Robot Firm (October 31): California-based Wonder Workshop makes a line of “CleverBots”–programmable robots that help students learn coding and robotics. This comes as U.S. schools are pushing for more science, technology, engineering and mathematics (STEM) in the curriculum…Read More>>

Chinese Universities Establish Xi Jinping Thought Institutes (October 30): At least 20 higher education institutions have already set up research bodies that will promote Communist Party chief’s dogma…Read More>>

Trade and Economic Relations

Chinese Business Groups Protest Section 301 Investigation by USTR (October 2): Two Chambers of Commerce representing Chinese business interests argued that the ensuing Section 301 investigations would “cause significant losses to the economies of both countries, and beyond”. Related: U.S. Delays Key Commerce Decision on China until after Trump's Trip; Section 301 Investigation and Hearing Transcript; China Trade Surplus with U.S. Highest on Record.

China, With Methodical Discipline, Conjures a Market for Electric Cars (October 2): According to The Wall Street Journal (subscription), the government is funding its own manufacturers, luring domestic buyers with subsidies and building a vast charging-station network—while strong-arming its consumers by making sure buying an electric car is the only sure way to get license plates in crowded cities. Related: Ford Revamps China Strategy Amid Electric Vehicle Push.

U.S. Business Groups Say WTO Unable to Curb Many Chinese Trade Practices (October 4): The concerns are not new. They were highlighted in the USTR’s last report to Congress on China’s WTO compliance issued on Jan, 1, 2017, and raised in subsequent meetings by Trump administration officials…Read More>>

U.S. Congress Considers Legislation Banning Shark Fin Trade (October 16): Bipartisan bills under consideration in the House and Senate may issue a federal ban on buying, selling, or possessing the prized Chinese cuisine ingredient; 12 state governments have already banned shark fin trade... Read More>>

 China, U.S. Agree on Standards for Aviation Design (October 30): According to Caixin (subscription), the move reflects Beijing’s success in upgrading its regulatory standards, which could also give the country’s nascent air industry a boost.

If You Read/Watched Nothing Else in October…

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

U.S. Must Defend Fuel Cell Tech From Chinese Pilfering (Colin Hanna, The Hill, October 3)

China and Russia’s Dangerous Entente (Alexander Gabuev, The Wall Street Journal [subscription], October 4)

Base China-U.S. Relations on Cooperation, Not Confrontation (Ambassador Cui Tiankai, USA Today, October 17)                                                                                                                      

The Chinese World Order (Andrew Nathan, The New York Review of Books, October 12)

Reports

Conflict with China Revisited: Prospects, Consequences, and Strategies for Deterrence (James Dobbins, Andrew Scobell, Edmund J. Burke, David C. Gompert, Derek Grossman, Eric Heginbotham, and Howard Shatz, RAND Corporation, October 2017)

As U.S. Retreats From World Organizations, China Steps in to Fill the Void  (Column Lynch and Elias Groll, Foreign Policy [subscription], October 6)

Interview

The East is Still Red: Xi Jinping and the return of China to its Maoist Roots (Robert Daly, Mei Fong, SCPR, October 25)

Video

2017 China Town Hall (Susan Rice, National Committee on US-China Relations, October 25)

A Brooklyn Gospel Choir Goes to China (Jocelyn Ford and Yuyang Liu, Chinafile, October 26)

Podcast

Alarm Bells in the Ivory Tower: Jim Millward on the Cambridge University Press Censorship Fiasco (Sinica Podcast)