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Hello, readers!

You’ll notice a new style, a new voice, and a different publishing cadence from us — starting today. Our free newsletter will transition to weekly — we’ll bring you a deeper dive into all the latest from China, but once a week instead of every day. Think of it as a weekly meal instead of a daily bite. Please note this is for our free newsletter (this one) — our paid subscription to SupChina Access will remain daily and unchanged.

To give us feedback — and please don’t hesitate to throw rotten tomatoes, or tell us what you love — write to theweekly@supchina.com.
1. Hong Kong's last stand — 1 million people march against ‘evil law’
Photo by SupChina's Anthony Tao

When Hong Kong was returned to Chinese sovereignty in 1997, after a century of British colonial rule, it was promised a “high degree of autonomy.” Dèng Xiǎopíng 邓小平, the leader of China at the time, called this “one country, two systems.” The agreement that Beijing made with the U.K. was that only after 50 years — that is, starting in 2047 — would the two systems be merged together.

But over the course of the years since 1997, the independence of Hong Kong’s system of government has been repeatedly undermined. Perceived encroachment by Beijing on Hong Kong led to mass protests in 2003 and 2014. Then the problems multiplied in the past year or so:

  • In March 2018, the Hong Kong government followed Beijing’s lead and proposed a maximum penalty of HK$50,000 and three years in prison for anyone breaking the new national anthem law which forbids any disrespectful behavior when China’s national song is sung.
  • The creeping influence of Beijing was manifested physically as part of a high-speed rail terminal was put under mainland Chinese jurisdiction on September 4, 2018.
  • The city’s press freedom entered terminal decline on October 5, 2018, when a Financial Times editor was denied a visa after he moderated a discussion with a pro-independence activist. The Hong Kong edition of the state-run China Daily made clear on October 9 that for anyone in Hong Kong, including foreign journalists, to “challenge the power of the central government” now crosses a “red line.”
  • In February 2019, the Hong Kong government proposed an extradition bill that would directly link the city to China’s Communist Party-controlled justice system. This sparked fears that Beijing could target political enemies in Hong Kong, and force them to leave the city to face an opaque and arbitrary justice system on the mainland. 
  • Despite widespread unease, the government has said it intends to push through the law by July.

On June 9, hundreds of thousands of Hong Kong residents from all walks of life — including, attendees noted, many who had previously avoided participating in marches in the city — came together to protest this extradition bill and much of the erosion of freedoms that it followed and represented.

William Yang reports for SupChina:

  • “The protests might well have been the largest Hong Kong has seen since the 1997 handover — organizers say 1.03 million people took part, while police estimate 240,000 at its peak.”
  • Two small rounds of changes to the extradition bill have been made since it was introduced in February. However, “many still view the concessions as merely cosmetic, and call the government’s claim that the bill is aimed at closing legal loopholes a ‘complete lie.’”
  • “Many cited distrust of the Chinese government as the primary reason for attending Sunday’s protest,” and some called the extradition bill merely “the latest step in Beijng’s plan to turn Hong Kong into just another Chinese city.”
  • Eight hours after the protest started, “riot police surrounded Hong Kong’s legislative council and clashed with protesters who stayed at the scene… Batons and pepper spray were used on protesters, who responded by hurling bottles and metal barricades at the police. An hour after the initial clash, stragglers were removed from the scene without much resistance.”
  • More photos and videos of the protests from SupChina’s own Anthony Tao are here. He notes that the common refrain at the protest was, “No extradition to China, oppose evil law” — 返送中, 抗恶法 (fǎn sòng zhōng, kàng è fǎ) — and comments that the police estimate of turnout, which is usually a much lower number than organizer estimates, was “laughably low” in this case.

The Hong Kong government was defiant following the protests. “As responsible officials standing here, we are duty-bound” to fix legal loopholes, Hong Kong chief executive Carrie Lam (林鄭月娥 Lín Zhèng Yuè'é) said, continuing the same argument as before for the extradition bill in a statement to the press, the Hong Kong Free Press reports.

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2. China is going to lead 5G mobile 
Illustration by SupChina

Everyone has heard about at least one of the famous national projects of China.

In the 21st century, China’s arguably largest national project — and certainly the one that has received the most admiration from foreigners, even if some grumble about stolen intellectual property — has been the breakneck construction of its 20,000-mile-and-growing high-speed rail network.

Before that, the early years of the People’s Republic of China saw national projects that had radically different outcomes, from humanitarian disasters (think the Great Leap Forward) to sources of immense national pride (like the country’s first testing of a nuclear bomb, in 1964). And though all the sections of the Great Wall of China predate the People’s Republic by several hundred years, those, too, could be considered national projects.

THE NEWS: A NEW NATIONAL PROJECT BEGINS

Green light for 5G rollout

The Ministry of Industry and Information Technology announced last week that it has approved licenses for the commercial rollout of fifth-generation (5G) telecom technology to major state-owned mobile carriers. It was “partly a response to the ongoing trade war with the U.S.,” reports CNBC.

Support for 5G part of new stimulus

The National Development and Reform Commission (NDRC) and the ministries of Commerce and of Ecology and Environment jointly released a two-year plan (in Chinese) to promote consumption, especially of electronics and vehicles that depend on 5G and new energy technologies.

Huawei working 24/7

Bloomberg News Network reported on the work atmosphere at China’s 5G leader, Huawei:

Huawei has assigned as many as 10,000 of its developers to work across three shifts a day in offices in Shanghai, Shenzhen, and Xi’an to try to eliminate the need for American software and circuitry, according to people familiar with the matter. From janitors to drivers, everyone has been drafted into the struggle and told to brace for escalating political and market pressure. Huawei has declined to comment beyond saying it’s had contingency plans in place for just such an occasion…

Engineers in some groups haven’t gone home for several days.

THE TAKEAWAY

The threat of an American cutoff of technologies vital to 5G has galvanized the Chinese government and public as well as the country’s hungry entrepreneurs. American sanctions on Huawei have hastened what may have been inevitable. Building a domestic, independent fifth-generation (5G) telecom is now an urgent national priority for China, one to be achieved by any means necessary, and possibly at great cost.

GO DEEPER:

3. China threatens to cut America off — the rare earth story
An evaporation pond at the Qinghai Salt Lake Industry Co. mines in Qinghai Province. Qilai Shen/Bloomberg via Getty Images

We at SupChina are expecting China to enact controls on the export of rare earth elements within days, or weeks at most. It’s not 100 percent for sure a path Beijing will take to retaliate against the United States in the trade war, but it’s definitely one of the likeliest actions for Beijing to take.

  • What are rare earths? Here are a few things to know, per Reuters and the New York Times:
    • They are a collection of 17 minerals such as neodymium, used in high-power magnets, and lanthanum, which is used as a catalyst to refine crude oil.
    • They are not actually rare, but they are difficult and costly to process.
    • China dominates 80 percent of global processing capacity at the moment.
  • Why would China cut off supply? The U.S.-China trade war has been escalating again since early May, and Beijing is looking for creative ways to retaliate against Trump’s tariffs.
  • How do we know the threat is so real? After repeated threats in state media, Beijing’s most important regulatory organizations have also started sending signals in recent days. A June 4 meeting of the powerful National Development and Reform Commission (NDRC) focused on rare earth supplies, for example.
  • How would the U.S. react? The U.S. Commerce Department has vowed “unprecedented action to ensure that the United States will not be cut off from these vital materials,” but many observers say that the immediate economic shock to supply chains by a move from Beijing would still be substantial.

As Beijing evaluates trade-related ways to respond to tariffs, it is also ramping up pressure on people-to-people connections with the U.S. Last week, Chinese government departments issued three warnings to Chinese citizens traveling to the U.S. in two days:

  • The Ministry of Education said that Chinese students in the U.S. are facing restrictions and difficulties with visas that are affecting their ability to complete their studies.
  • The Ministry of Culture and Tourism warned all Chinese citizens about “American shooting incidents, robberies, and incidents of theft.”
  • The Ministry of Foreign Affairs warned of “many kinds of harassment” by U.S. authorities.

“This is the next iteration of where this is going as it moves from the economy and security to people-to-people,” scholar Jude Blanchette told the SCMP. “Both the US and China are going to weaponize talent. China is not wrong to issue this warning,” Blanchette added.

More recent news about the U.S.-China trade war:

  • China blamed the U.S. for trade talk breakdowns in a white paper published by the State Council Information Office, and the U.S. Trade Representative accused China of having chosen to “pursue a blame game misrepresenting the nature and history of trade negotiations.”
  • Meanwhile, Trump threatened to expand tariffs to include another $300 billion in Chinese imports, but said he would wait to make a decision until after the G20 meeting in Osaka, June 28–29.
  • Here is an excellent take on the U.S.-China trade war: a Q&A with businessman, China media veteran, and author James McGregor in New York magazine.

Want to know more about Beijing’s next moves in the trade war? On June 19, SupChina will be holding a conference call with Stephen Roach, former head of Morgan Stanley Asia and currently a professor at Yale University. It’s free to sign up — just click here!

4. The largest grave relocation in human history

Here is yet another record set by China: As the country has urbanized in the last 20 years, more than 10 million corpses have been exhumed in the largest grave relocation in human history.

Stanford historian Thomas S. Mullaney explains in this Q&A:

I found that the driving force behind these grave relocations has been the rapid development of third- and fourth-tier Chinese cities — cities that, unlike major metropolises like Beijing and Shanghai, few people outside of China have heard of. This development entails new highways, railways, airports, hospitals and primary schools, among other things. But the relocations are also centrally important to the income of local governments across China, who make money from leasing their land. Because there is no private land ownership in China, a central part of local governments’ budgets is money they make on renting their land.

For more on this fascinating subject, see the website Mullaney has created, Grave Reform in Modern China, comprising a series of essays on matters sepulchral, together with an interactive map of grave relocations.

5. China’s college admissions madness

In a very “China 2019” story, the People’s Daily published the photo above showing government workers using radio equipment to test for illegal transmissions near high school examination sites in Hebei Province. The report says that they hope to “prevent and combat cheating by using radio equipment” during the gāokǎo 高考, the college entrance exams that took place June 6–9.

10.3 million high school students took the gaokao this year in China, the Ministry of Education reported (in Chinese). The score received on the test is the sole criteria for college admissions in the country, so the stakes couldn’t be higher, and students study for many months in advance — an article in the South China Morning Post takes a look at the grueling preparation process.

With so much pressure to perform, it’s no wonder that cheating happens, and that authorities take extreme measures to guard against it. It also means, SupChina reported, that Chinese were perhaps even less surprised than Americans when it was revealed a couple months ago that in the U.S., a single fraudulent consulting company had collected $25 million from wealthy parents to help them game the admissions system and get their children into elite colleges.

Other college admissions-related reporting on SupChina:

Look out for the SupChina Weekly Briefing in your inbox every Tuesday. To get daily roundups of China news, access to a members-only Slack channel and exclusive expert chats, and discounts on other SupChina events and products, sign up to SupChina Access today!
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