In this week’s Chinascope, we look at the Meng Wanzhou deal, China’s infrastructure juggernaut coming to a halt, detained executives of HNA group and Xi Jinping’s speech at UNGA.
China over the week
Prime Minister Narendra Modi’s visit to the US and UN General Assembly was the most discussed Indian topic on Chinese social media this week. Global Times published a widely read story in Chinese titled “India wanted to obtain nuclear submarine like Australia, but the US rejected”. Guancha translated and published a story from English by Indian journalist Nilesh Christopher on the tussle between Indian merchants and US e-commerce giant Amazon. The story was much read and shared on Weibo.
There was another top trend on Weibo – detained Huawei CFO Meng Wanzhou’s triumphant return to China as a demonstration of ‘motherland nationalism’. The highly watched US extradition case has finally ended.
CFO Meng Wanzhou was released after a deferred prosecution deal in the New York court. She had been detained in Vancouver, Canada, on an extradition request by the US for three years in a bank fraud case, and Meng pleaded “not guilty”.
China had detained two Canadian citizens in response to Meng’s detention – Michael Kovrig and Michael Spavor – who were released on the same day in what turned out to be a “swap”.
Meng’s return to China generated tremendous interest in Chinese State media and social media. The media used Meng’s release to stoke nationalism by celebrating her return to the “Chinese motherland” and even live telecast her arrival.
“Meng Wanzhou released, thanks for the support of the motherland and people” was the number one trend on Baidu. The trend was viewed over 4.98 million times. “Meng Wanzhou’s release of not guilty is gratifying” was another leading trend on Baidu. Xinhua News Agency’s “Meng Wanzhou returned smoothly to the motherland” was the most read on Sunday.
“Happy Birthday to the Motherland! The road home, despite its twists and turns, is the warmest way home in the world,” Meng said, days ahead of China’s National Day on 1 October.
Even as China Covid-cautiously celebrated the Mid-Autumn Festival, the Evergrande crisis didn’t go away. The company missed its $83 million dollar bond debt payment deadline last Friday noon. It’s a part of the $305 billion Evergrande owes overall. The embattled real estate giant continues to face the grave prospect of collapse.
The Evergrande fiasco generated interest among a section of Chinese media. Chinascope explained Evergrande’s debt crisis in last week’s edition and recommends watching The Print’s Editor-in-Chief Shekhar Gupta explain the Evergrande saga and its economic implications.
Shenzhen State-owned Assets Supervision and Administration Commission are in talks with Evergrande to purchase its projects in Shenzhen, but a deal hasn’t been finalised.
Beijing has sent a message to Evergrande.
“In a recent meeting with Evergrande representatives, regulators said the company should communicate proactively with bondholders to avoid a default but didn’t give more specific guidance, a person familiar with the matter said,” reported Bloomberg.
Meanwhile, China’s Alibaba will divest a 5 per cent stake in broadcaster Mango Excellent Media. Alibaba had acquired the stake in the company nine months ago. Earlier in March, Beijing had asked Alibaba to dispose of all of its media assets.
In another much-discussed action, China targeted three high-powered executives this week. Chinese police detained Chen Feng and Adam Tan, the co-founders of the Chinese transportation and logistics conglomerate HNA Group. The conglomerate had global operations before the company faced trouble repaying its debts in 2017. And former chairman of Chinese liquor company Kweichow Moutai, Yuan Renguo received a life sentence. Yuan was charged with accepting 112.9 million yuan ($17.5 million) in bribes. Moutai Group is partly publicly traded and partially state-owned.
Ride-hailing company Didi Chuxing remains in the news after the company came under scrutiny by Beijing. Didi Chuxing’s co-founder Jean Liu may step down, according to sources. The company isn’t yet out of the woods as China’s regulatory and security agencies’ cybersecurity review – which started in July – continues.
This week, China also took further action against cryptocurrency.
The Chinese central bank declared all cryptocurrency transactions illegal, as did ten different Chinese governments. China has previously banned cryptocurrency transactions by financial institutions, but the past bans have failed to eliminate cryptocurrencies from China.
An important promotion
This week a Chinese military promotion targeted at India was a significant development. Liu Lin, the military commander who has negotiated with the Indian Army in the past, was promoted to the commander of Xinjiang Military District, according to a local news outlet in Xinjiang.
The promotion indicates that the Central Military Commission was pleased with Liu Lin’s work in the military sub-region, which focused mainly on India. Liu was also awarded the rank of lieutenant general. Liu previously served as the commander of the Southern Xinjiang Military Region.
China in world news
Over the past week, President Xi Jinping’s address at the United Nations General Assembly made news around the globe.
“China has never and will never invade or bully others or seek hegemony,” President Xi Jinping said in a pre-recorded address at the UNGA on 21 September. During the address, Xi also pledged to stop building new coal energy plants abroad. But it was unclear what would happen to existing and approved projects.
Chinese ambassador to the US, Qin Gang’s remarks were much discussed. Qin called China a “whole process democracy”.
“Isn’t it obvious that both China’s people-centred philosophy and President Lincoln’s ‘of the people, by the people, for the people’ are for the sake of the people?” said Qin Gang during the virtual conference organised by the Carter Center.
What you must read this week
Chinascope recommends some of the excellent articles that dig deep into the most recent news coming out of China.
Jiang Zemin and the PRC’s first orderly transfer of power – James Carter
Xi Jinping Aims to Rein In Chinese Capitalism, Hew to Mao’s Socialist Vision – Lingling Wei
China Is a Declining Power—and That’s the Problem – Hal Brands and Michael Beckley
“Regarding Saudi Arabia, the considerations are that Iran and Saudi Arabia were originally a contradictory pair, and Iran has started the membership process, and Saudi Arabia will be inducted as a dialogue partner to reach a relative balance. Moreover, Saudi Arabia is a leading Sunni Islamic country with great influence, and its accession can make the SCO’s influence greatly enhanced,” wrote Pan Guang, Director of Shanghai Cooperation Organisation (SCO) Research Center of Shanghai Academy of Social Sciences.
This week, Chinascope recommends listening to SCMP’s Inside China podcast, which looks at the Evergrande debt crisis and discusses if the Chinese real estate fiasco is similar to the US’ “Lehman movement”.
This week, Economist’s Intelligence podcast examines China’s views of the first in-person Quad summit in Washington DC.
China will hold the annual World Internet Conference in Wuzhen, Zhejiang province, from 26 to 28 September. And 1 October will mark the foundation day of the People’s Republic of China. That week – 1-7 October – is celebrated as a week-long national holiday and also referred to as “Golden Week”.
The author is a columnist and a freelance journalist. He was previously a China media journalist at the BBC World Service. He tweets @aadilbrar. Views are personal.
This is a weekly round-up that Aadil Brar will write about what’s buzzing in China. This will soon be available as a subscribers’-only product.
(Edited by Neera Majumdar)