Part of The Month in US-China Relations Newsletter

Article

The Month in U.S.-China Relations 中美关系一个月 (September 2016)

By Sandy Pho on October 5, 2016

While most Americans were celebrating Labor Day, China was busy hosting world leaders at the G20 Summit in Hangzhou. Despite the brouhaha caused by China’s alleged airport snubbing of President Obama, he and General Secretary Xi found time for a choreographed midnight stroll and a cup of tea and the two leaders announced an agreement to formally ratify the Paris climate change deal. The two sides continued to tout bilateral cooperation, but increased restrictions on American businesses, NGOs, and media firms in China were stark reminders of the limits of the relationship. In the aftermath of Hangzhou—the biggest story in bilateral relations may have been a dog that didn’t bark—China has not yet declared a South China Sea air defense identification zone; nor has it built out the Scarborough Shoal, or otherwise taken escalatory actions in its “near seas,” as many feared it might after the time-out necessitated by the G20. Following the July decision of the Permanent Court of Arbitration that invalidated China’s Nine-Dash Line, we are still in a cooling off period that could extend through the American presidential election and into 2017, when China will hold its critical 19th party congress.

Sandy Pho

Senior Program Associate, Kissinger Institute

Major Issue Tracker

China as an Emerging Superpower

China to Deepen Military Engagement in Middle East (September 1): As reported by the South China Morning Post, China plans to protect its growing interests in the Middle East by deepening its military engagement in the region and may break its non-alignment policy in the future. Related: China’s Changing Security Strategy in the Middle East.

Hangzhou G20: China's Ambitions for Global Leadership (September 2): According to the BBC, last month’s G20 demonstrated again that, once the one-party state sets a goal, it can effectively command its people to get behind it. Related: 7 Things You Might Have Missed at China’s G20 Summit.

Virtual Gold: Why Beijing is Leading China's Bitcoin Revolution (September 5): Bitcoin is a fully decentralized currency, which means that no one institution or government controls it. Chinese companies mine more bitcoin than any others, and one such company, HaoBTC, accounts for 5 percent of global mining…Read More>>

New Rail Line to China Carries Hope for Afghan Economy (September 7): A new train route linking China’s port city of Haimen to Afghanistan’s third largest city completed its inaugural trip September 7th. The new line, part of China’s “One Belt, One Road” initiative, cuts transit time in half by avoiding Pakistan…Read More>>

China's High Seas Ambitions (September 8): According to Der Spiegel’s Bernhard Zand, China is tapping the world's oceans for its own strategic purposes through its maritime silk road, causing unease in India and the United States. Related: Peru's President Throws Cold Water on Chinese Railway Proposal.

China Rethinks Alliance With Venezuela (September 11): The Wall Street Journal (subscription) reported that concerns about debt repayment and safety of expatriates prompted emergency meetings between China’s envoy and state companies in Venezuela. China’s pullback could have ramifications across Latin America and Africa, where resource-rich countries turned to Chinese financing during the commodities boom. Fox Latino also reported on this story.

China Set to Show-Off J-31 Stealth Fighter, Y-20 Heavy Transport Aircraft (September 13): As reported by The Diplomat (subscription), Beijing will tout its two indigenous military aviation platforms at the 2016 Zhuhai airshow. Xinhua first reported on this story. Related: The Next Generation of China’s Carrier-Borne Fighter, the Flying Shark, Takes to the Skies.

China in a Bind over North Korea (September 18): According to Reuters, China is stymied over how to manage North Korea's stepped-up nuclear and missile tests. Beijing is annoyed with its ally and has started talks with other U.N. Security Council members on a new sanctions resolution against Pyongyang, but it is not willing to cut the Kim regime off altogether.

People's Daily Calls U.S. a "Source of Turmoil" (September 18): The People's Daily, the official newspaper of the Communist Party of China, published three articles by Chinese scholars analyzing U.S. hegemony from political, ideological and strategic perspectives.

The U.S. Rebalance to Asia

Pentagon Denies Australia Under Pressure to Take Sides in Dispute (September 3): In a statement last month, U.S. Army Assistant Chief of Staff Colonel Tom Hanson said Australia needed to make a choice between the U.S. and China. The Pentagon said his comments did not represent the U.S. government position…Read More>>

U.S.-ASEAN Summit in Vientiane, Laos (September 8): White House fact sheet on President Obama’s trip to the U.S.–ASEAN Summit in Vientiane, Laos.

U.S. Alarm at Chinese Donations (September 16): In an exclusive interview, departing U.S. Ambassador to Australia, John Berry, said foreign donations were illegal in America, and the U.S. had been “surprised” by Chinese efforts to sway Australian elections…Read More>>

Obama Recruits Kasich, Paulson to Sell Struggling Trade Deal (September 16): President Obama ramped up his campaign to persuade Congress to pass the Trans -Pacific Partnership, which is opposed by both presidential candidates and many lawmakers…Read More>>

Southeast Asia and the South China Sea

China/Russia Joint Exercises in South China Sea (September 13): Chinese and Russian naval forces conducted joint exercises in the South China Sea last month. The eight-day exercise, “Joint Sea 2015”, highlighted “live fire drills, sea crossing and island landing operations, and island defensive and offensive exercises”…Read More>>

Duterte Orders U.S. Forces Out of Southern Philippines (September 13): According to Al Jazeera, days after saying he was "not a fan of the Americans, President Duterte said he wanted to "reorient" foreign policy with Washington. Related: We need U.S. for South China Sea-Duterte

Vietnam Delays TPP Vote (September 16): According to the Bangkok Post, Vietnam will not include ratification of the Trans-Pacific Partnership (TPP) on the agenda for its next parliamentary session. Related: Faced With TPP Impasse, Malaysia And Vietnam Retrench; What’s Behind Vietnam’s Delayed TPP Ratification.

Six Takeaways from ASEAN Summits (September 15): Under Laos' stewardship, ASEAN tamped down concerns over South China Sea disputes…Read More>>

Indonesia Explores Possibility of U.S. Financing for South China Sea Base (September 21): Indonesia is seeking support from Washington to upgrade its naval bases and strengthen the Indonesian navy's presence in the South China Sea and Sunda Strait…Read More>>

Rodrigo Duterte to End Joint U.S. and Philippine Military Drills (September 29): Philippine president Rodrigo Duterte said he has informed his country’s long-standing ally that upcoming joint exercises of Filipino and American troops will be the last such drills…Read More>>

Military

‘We’ve Got to Continue to Engage’ China (September 12): When it comes to China, “first and foremost, I think we’ve got to continue to engage,” U.S. Navy Admiral John Richardson said last month at the Center for American Progress. He said the Chinese “by and large” behave professionally, not provocatively, when the two nations meet at sea…Read More>>

Navy’s Largest Shipbuilder Looking for Subcontractor in China (September 15): Senior executives from major U.S. defense contractor, Ingalls Shipbuilding, toured China last month as part to find a foreign company to build a dry dock for U.S. Navy ships …Read More>>

U.S. Elections and Domestic Politics

Hillary Clinton: China Hawk (September 5): The new U.S. president will face a choice between continuing the “pivot” strategy and accommodating Beijing. According to the Financial Times (subscription), Secretary Clinton’s actions as America’s lead diplomat prove she is prepared to adopt a tough approach to China.

Meet Donald Trump's Feng Shui Master (September 13): This South China Morning Post article profiles how the Republican nominee adopted an ancient Chinese philosophy that aims to harmonize people with their surroundings.

Donor to Clinton Foundation, McAuliffe Caught in Cash-For-Votes Scandal (September 16): Wang Wenliang, a Chinese billionaire and donor to the Clinton Foundation and Virginia Gov. Terry McAuliffe, has been expelled from China’s legislature after being implicated in a vote-buying scheme…Read More>>

John Boehner Joins Lobbying Firm That Represents China (September 20): According to The Intercept, former Speaker of the House, John Boehner, is joining Squire Patton Boggs, a lobbying firm that represents a number of foreign nations, including the PRC.

Wanda Accused of Using Foreign Money in Beverly Hills Ballot Fight (September 22): The Dalian Wanda Group is accused in a new complaint of using foreign funds to influence the outcome of a ballot measure in Beverly Hills…Read More>>

EB-5 Program Renewed for a Couple of Months (September 29): The EB-5 (immigrant investor) program was extended by Congress — but only until December 9. Most applicants to the program are Chinese nationals…Read More>>

Soft Power

AMC Theatres’ Wang Jianlin’ Delusional Plan to Infiltrate American Culture (September 3): Wang Jianlin, chairman of Dalian Wanda Group, which owns AMC Theaters, said he plans to screen more China-related films in the U.S. He also declared war on Disneyland, saying he wanted to “change the world where rules are set by foreigners”…Read More>>

An American Opera Company Adapts China’s “War and Peace” (September 9): “Dream of the Red Chamber,” an opera adapted from an 18th-century novel, is currently playing at the San Francisco Opera. U.S.-China Today, the New York Times (subscription), and the LA Times reported on the story.

The NFL’s Next Big Fan Base is China (September 11): Quartz reported that nearly 8 percent of the Chinese population watched at least one NFL game last year. This year’s Super Bowl had more than 15 million Chinese viewers. Related: Manning Promotes American Football in China.

Trailer for Chinese Korean War Film Revives Debate (September 14): According to the South China Morning Post, a patriotic film featuring Chinese veterans of the Korean war ignited controversy in China. The issues erupted as South Korea-China relations were cooling following Seoul’s decision to deploy the U.S. Terminal High Altitude Area Defense system.

Michelin Guide to Shanghai Dishes Stars to 26 Restaurants (September 21): The inaugural Michelin guide to dining in mainland China handed out stars to 26 restaurants in the city, with T’ang Court in The Langham Shanghai the only one to get the top rating…Read More>>

Lang Lang Named NYC's First 'Cultural Tourism Ambassador' (September 22): Chinese superstar pianist Lang Lang’s new role is to help attract Chinese tourists to the Big Apple. Mayor Bill de Blasio declared September 20 as “Lang Lang Day”…Read More>>

Brangelina Divorce Breaks Chinese Internet (September 22): According to Foreign Policy (subscription), Chinese who grew up watching Friends are on Team Aniston. Others blame karma, or even the Dalai Lama for the split. Yibada ran a similar story.

Lawmakers Question Chinese Investment in Hollywood (September 22): 16 members of Congress sent a letter to the Government Accountability Office calling for greater scrutiny of foreign investments in the telecommunications and media sectors. The members listed China-based Dalian Wanda’s recent acquisitions as cause for concern over “China’s efforts to censor topics and exert propaganda controls on American media.” Variety and the Washington Post reported on this story. Related: Will China Soon Control American Movies?

Wanda Group Partners with Sony Pictures (September 23): Chinese conglomerate Dalian Wanda Group announced a partnership with Sony Pictures last month, giving it creative control over upcoming Sony films …Read More>>

Anger Over Gangsta Rap (September 27): According to Foreign Policy (subscription), the song “Meet the Flockers,” by American hip hop artist YG, is causing concern in China and among Chinese Americans because it advises thieves to target Chinese neighborhoods.

Cyber, Espionage, and Surveillance

U.S. Charges Air China Worker With Smuggling for Chinese Military (September 1): As reported by Reuters, a former Air China employee was indicted for smuggling packages onto flights from New York to China on behalf of Chinese military personnel stationed at the country’s UN missions.

House Report: Massive OPM Breach a Failure of Leadership (September 7): The House Oversight Committee released an investigative report on the 2014-2015 OPM breaches last month, concluding that the attacks were “likely connected and possibly coordinated by two Chinese government-sponsored groups…Read More>>

U.S. Thinks China Wants to Read Your E-Mail (September 13): The U.S. initiated a formal review of Huawei’s potential role in building the U.S. 5G wireless network. U.S. military and intelligence communities have long warned that Huawei is an arm of the PLA…Read More>>

Microsoft and Huawei Launch Cybersecurity Guide (September 14): Microsoft and Huawei created a joint cybersecurity guide for all organizations interested in acquiring more secure information and communications technology (ICT) products and services…Read More>>

U.S. Husband Fights for Wife Accused of Spying in China (September 21): Sandy Phan-Gillis, a Chinese American businesswoman accused by the Chinese government currently detained in China and awaiting an October trial….Read More>>

Chinese Agents Illegally Enter Canada on Tourist Visas (September 21): China’s security services have been sending undercover agents into Canada on tourist visas to strong-arm expatriates suspected of corruption and other criminal activities to return home … Read More>>

Internet, Media, and Technology

Behind China’s Firewall, Google Maps Shows Nine-Dash Line (September 13): Google Maps was criticized after users noticed that some of its maps featured the controversial Nine-Dash Line that marks China’s claims in the South China Sea. According to the Wall Street Journal (subscription), Google Maps said it abides by local law, meaning that disputed territories would show sovereignty in local domains, but not in global domains.

Education and Academic Relations

President Xi Congratulates opening of Schwarzman College (September 10): The Schwarzman Scholars program of Tsinghua University is a one-year post graduate program co-founded by the university and American financier Stephen Schwarzman…Read More>>

For U.S. Minority Students in China, The Welcome Comes With Scrutiny (September 17): The U.S. and China are committed to sending more young people to study language and culture in each other's countries — but U.S. minority students don’t always feel welcome in China… Read More>>

Trade and Economic Relations

U.S. Files Case Against Chinese Agriculture Subsidies (September 13): As reported by Bloomberg, the U.S. brought a trade complaint to the WTO alleging that China offers excessive support for production of corn, rice, and wheat, denying American farmers the ability to compete fairly. According to the USDA, China was the second biggest buyer of U.S. agricultural products in 2015.

Yum Brands, McDonald’s Begin China Pullback (September 13): Yum, which owns KFC, Pizza Hut, and Taco Bell, began spinning off its China operation. Yum and McDonald's are reshuffling their China operations due to "pressures from investors.”…Read More>>

Chinese Demand Wiping Out Appalachian Ginseng (September 14): According to Foreign Policy (subscription), the global market for ginseng is worth more than $2 billion. Ginseng is rare in East Asia, due to overharvesting, but flourishes in the hills of Appalachia…Read More>>

Chinese Vitamin Makers Win Dismissal of Judgment (September 20): Two Chinese drug companies won dismissal of a $147 million antitrust verdict after a U.S. federal appeals court ruled they were acting under Chinese law and couldn’t be held liable in the U.S. for fixing prices…Read More>>

Hoping to Work in China? If you’re a Class C Foreigner, It May Be Tough (September 21): According to the New York Times (subscription), starting Nov. 1, Beijing will begin sorting foreigners resident in China into three categories—A, B and C—as part of a new nationwide work permit system. The goal is to build an innovation-driven economy by “encouraging the top, controlling the middle, and limiting the bottom” of foreigners in China. gbtimes and China Daily also reported on this story.

China Ends Ban on Beef From U.S. as Imports Explode (September 22): China removed a ban on shipments of some U.S. beef products, opening up the trade for the first time since 2003, as the country sees a surge in imports of the meat…Read More>>

If You Read/Watched Nothing Else in September…

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:

Book

Easternization: War and Peace in the Asian Century, Gideon Rachman (Bodley Head, 2016, Available on Amazon UK)

Blog

Four Years On: Where is Xi Jinping’s Anti-corruption Drive Headed? (Andrew Wedeman, China Policy Institute Blog, Hong Kong Free Press, September 26)

Essays

Will China Soon Control American Movies? (Congressman Frank Wolf, Washington Post, September 15)

Committed: U.S. Foreign Policy in Asia and Completing the Rebalance, Edited by Shihoko Goto (Wilson Center , September 23)

Journal Article

Plus ça change? Media Control Under Xi Jinping (Anne-Marie Brady, Problems of Post-Communism, September 7)

Report

A Sharper Choice on North Korea: Engaging China for a Stable Northeast Asia (Council on Foreign Relations, September 2016)

Speech