Tag Archives: China

China’s Technology Ambitions Could Upset the Global Trade Order

BEIJING — When President Trump arrives in Beijing on Wednesday, he will most likely complain about traditional areas of dispute like steel and cars. But Washington officials and major global companies increasingly worry about a new generation of deals that could give China a firmer grip on the technology of tomorrow.

Under an ambitious plan unveiled two years ago called Made in China 2025, Beijing has designs to dominate cutting-edge technologies like advanced microchips, artificial intelligence and electric cars, among many others, in a decade. And China is enlisting some of the world’s biggest technology players in its push.

Sometimes it demands partnerships or intellectual property as the price of admission to the world’s second-largest economy. Sometimes it woos foreign giants with money and market access in ways that elude American and global trade rules.

When concerned officials in Washington began blocking China’s ability to buy high-end technology last year, one American company found a way to help its Chinese partner around those limits. The company, Advanced Micro Devices, avoided scrutiny by licensing its exclusive microchip designs, rather than selling them.

The Chinese partner got access to the technology to make its own products. Advanced Micro Devices got a big payout.

The rules of global commerce are changing — and China and the United States are racing to create a future that aligns with their own distinct visions. The result could be an overhaul of 20th-century trade rules for a 21st-century global economic order, in which money, ideas and influence could become as closely watched and tightly regulated as hard goods packed on a ship and sent abroad.

Even before the Communist Revolution, China obsessed about absorbing foreign technology as a way to end a century of humiliation and restore its national strength. But Made in China 2025 is more ambitious than anything the government has ever attempted, a national industrial policy that aims to project a new type of global might and influence.

China is directing billions of dollars to invest in research at home as well as to acquire innovative technology from abroad. A Beijing-directed semiconductor fund is thought to have more than $100 billion at its disposal, while another plan aims to grow China’s artificial intelligence companies into a $150 billion industry by 2030.

Such efforts have some American government officials and business leaders calling for a rethinking of how the United States approaches trade. Lawmakers are pushing for tougher rules on technology purchases, which do not usually cover the types of deals that China increasingly prefers. Officials are also investigating whether China is stealing intellectual property.

“There are a few U.S. companies that have been leaning too far about sharing technology with countries that are potential enemies of ours,” said Wilbur L. Ross Jr., the United States secretary of commerce, in September remarks regarding information technology that were widely seen as referring to China.

“I don’t think that’s a very good idea. I think it’s the ultimate short-termism to give up very valuable I.T. in order to get a few quarters or a few years of improved sales.”

Robots and Rice Cookers

China looks to the West for much of its technology. Even some of its most sensitive systems that run government computers, banks and laboratories use chips from Intel and Qualcomm and software from Microsoft or Oracle, a dependence it sees as a long-term vulnerability.

The government hopes to change that. It is backing the effort with money: $45 billion in cheap loans for its companies, $3 billion for advanced manufacturing efforts and billions more in other financial support, according to the Mercator Institute for China Studies, a German think tank.

Made in China 2025 “is going to have substantial resources and focus devoted to it, especially at the local government level,” said Kai-Fu Lee, a prominent venture capitalist in Beijing.

The goal is not simply to beat the United States. China is preparing for a day when cheap manufacturing no longer keeps its economy humming. It wants to embrace industries offering skilled jobs that do not blacken its skies and cloud its rivers.

The plan itself has specific targets and quotas. By 2025 it envisions China meeting nearly three-quarters of its own demand for industrial robots and more than a third of its demand for smartphone chips. Other targets cover new-energy cars, like electric cars, and high-performance medical devices.

The template for Made in China 2025 was cribbed from a German government plan called Industrie 4.0, which calls for greater automation and the growing use of “smart factories” doing sophisticated work with fewer people. And the deal that woke up the world to China’s plan was a German one.

Last year, a Chinese appliance maker called Midea struck a surprise $3.9 billion deal to acquire Kuka, an advanced robotics company in Germany. The deal made Midea — best known for its refrigerators and rice cookers — a major player in automation.

“Our partnership with Kuka is actually about whole factory solutions,” said Irene Chen, a spokeswoman for Midea.

Where technology cannot be purchased, the government wants Chinese companies to extract it from foreign firms through deals or tough new laws.

China will soon require foreign auto companies to make electric cars there if they want to continue selling gasoline-powered vehicles in what is now the world’s largest car market. General Motors, Volkswagen and others have been scrambling to form joint ventures with Chinese partners to do so.

Cybersecurity laws enacted this summer give the Ministry of State Security the power to conduct security reviews of technology sold or used in China, said James A. Lewis, senior vice president of the Center for Strategic and International Studies. Such a step could require companies to expose some of their most valuable secrets.

At some companies, Chinese security officials conduct the inspections in corporate “clean rooms” in the United States, with the Chinese officials traveling on business visas, Mr. Lewis said. The companies argue that the access takes place under controlled circumstances that limit what Chinese officials might learn.

“If American companies have a big market in China, they say to the Ministry of State Security, ‘Come in,’” Mr. Lewis said. “Everyone fears retaliation. No one wants to lose the China market.”

Old Rules, New Products

Wary of the push, the United States has used existing rules to stop Chinese purchases of foreign businesses in areas important to national security.

But many of those tools do not apply to today’s deals, as A.M.D.’s Chinese pact shows.

A.M.D.’s joint venture with its Chinese partner can be found in a gleaming industrial area of the city of Chengdu called Tianfu Software Park.

The park represents Beijing’s vision of the future. Trees and sidewalks jammed with ride-sharing bikes sit beneath a vast strip of office towers, hotels and apartment complexes. Offices of China’s most innovative companies, like Huawei and Tencent, sit next to outposts of their foreign analogues, like SAP and Accenture.

Inside one of its glass towers, A.M.D. works with its Chinese partner, a company called Sugon, to produce new chips.

Under the nearly $300 million deal, A.M.D. agreed to license chip technology to a Chinese joint venture with Sugon to make chips for servers. Because A.M.D. controls that joint venture, the technology is considered to remain in American hands.

But A.M.D. struck a second partnership that the Chinese company controls. That joint venture works on applications such as integrating the chips with servers. The two ventures are on the 11th and 12th floors of the same building.

Experts say the dual partnerships could help China develop a new generation of powerful supercomputers. China already makes the world’s fastest computers, but they run on homegrown chips that cannot read commonly available software for supercomputers. With A.M.D.’s help, experts say, Sugon could develop chips that could make China’s supercomputers more versatile and adaptable and replace those from foreign firms.

“We have worked closely with and been very clear with U.S. government officials on the strategy and specifics of the technology, which is classified as permitted for export,” an A.M.D. spokesman said in an emailed statement. He added that the processors are also lower performing than other options that A.M.D. sells in America.

Executives in Chengdu said there was a firewall between the two joint ventures, and the one outside of A.M.D.’s control was not involved in chip development.

Yet in an interview with the Chinese state news media, Zhang Yunquan, a top government researcher and head of the National Supercomputing Center in Jinan, China, said that Sugon could use the work of the joint venture to make supercomputer microchips. Such a supercomputer would be crucial in designing next-generation weapons systems, according to experts.

“When they first announced the partnership I was shocked,” said Stacy Rasgon, a semiconductor analyst with Sanford Bernstein.

“You would think intellectual property and joint ventures would belong under Cfius review,” Mr. Rasgon said, referring to the Committee on Foreign Investment in the United States, which reviews foreign deals. “It should. It’s surprising it isn’t.”

New Rules for a New Era?

For some in the Trump administration, an 18-year-old book by two Chinese Air Force colonels has become required reading.

Called “Unrestricted Warfare,” the book argues that China does not need to match the United States militarily. Instead China can take advantage of the global economy and the internet to take down its main rival.

Some American officials see in it a guide to China’s plan. Some United States lawmakers are proposing to toughen American takeover laws to evaluate deals on an economic as well as a national security basis. They are also pressing for reviews of licensing agreements and joint ventures. The United States trade representative has also launched an investigation into whether Chinese companies are stealing intellectual property.

“There’s concern that U.S. firms are transacting away their competitive advantages,” said Greg Levesque, managing director of Pointe Bello, a research firm in Washington, and a former executive at the US-China Business Council.

Such changes could ripple through the tech world. Chinese investment often means more money with fewer strings attached. Some tech companies say that is good for innovation. China’s spending on science and research is also growing at a time when the United States government and others are cutting back.

Still, many American companies fear the deck is stacked against them. The United States long believed bringing China into the World Trade Organization, which oversees global trade disputes, would ensure it would follow the rules. But the W.T.O. has proved ineffective when it comes to tech issues.

At a recent dinner event in Washington, an American technology executive held up a dinner plate to illustrate the size of the China market, said a person who was there who asked not to be identified because the event was not public. Then the American executive held up a wine coaster that represented the size of his firm’s business.

The message was clear: American companies are at risk of being muscled out of the market.

“Made in China 2025 seems to reject all notions of comparative advantage and future opportunities for high-value-added manufactured exports from the rest of the world to China,” said Jeremie Waterman, president of the China Center at the U.S. Chamber of Commerce.

“If Made in China 2025 achieves its goals,” he said, “the U.S. and other countries would likely become just commodity exporters to China — selling oil, gas, beef and soybeans.”

By Jane Perlez/NYTimes

Posted by The NON-Conformist

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China warns ‘unpermitted’ US patrol to leave disputed waters in S. China Sea

China warns ‘unpermitted’ US patrol to leave disputed waters in S. China Sea
The Chinese Navy has warned a US warship to leave, as it sailed within 12 nautical miles of the Spratly Islands in the South China Sea “without permission.” Beijing says that the latest US move disrupts the peace process in the region.

After the USS Dewey guided missile destroyer entered waters near the disputed land “without permission from the Chinese government,” the country’s navy “warned it to leave,” Chinese Foreign Ministry spokesman Lu Kang said at a news conference on Thursday, as cited by AFP.

China slammed the recent US patrol, saying that it “undermines China’s sovereignty and security interests.” Beijing urged Washington to “correct this mistake” and refrain from further provocations that can undermine the “peace and security of the region” as well as bilateral cooperation between the US and China.

“Stop taking further provocative actions that hurt China’s sovereignty and maritime interests, so as to avoid hurting peace and security of the region and long term cooperation between the two countries,” Lu Kang stated. He added that these patrols can “cause unexpected air and sea accidents,” Reuters reports.

The ‘USS Dewey’ guided missile destroyer entered Mischief Reef in the Spratly Islands, within 12 nautical miles of the disputed land, on Wednesday. Coastal waters extending 12 nautical miles are identified as territorial waters by the 1982 United Nations Convention, meaning the US entry challenges China’s territorial claims.

The Spratly Islands have been at the center of territorial disputes between China, the Philippines, Vietnam, Malaysia, Brunei and Taiwan as the region is strategically important for trade. Beijing’s claims to nearly all of the resource-rich South China Sea and its construction of military facilities on the islets have been criticized by US authorities. China has consistently said that it will resolve the dispute with its neighbors, rejecting a 2016 Hague tribunal ruling which did not approve the Chinese claims and ruled in favor of the Philippines.

US warships had been spotted in the region previously, but the Wednesday entry is the first since Donald Trump took office. In the meantime, the US president is seeking support from his Chinese counterpart, Xi Jinping, to restrain North Korea, which continues to hold nuclear and missile tests.

From RT

Posted by The NON-Conformist

China to US: NO military force in North Korea

China has said ‘Military force cannot resolve the issue’ in North Korea in an apparent message to the United States as Donald Trump has put Kim Jong-Un on notice.

(Washington, DC) Military force cannot resolve tension over North Korea, China said on Thursday, while an influential Chinese newspaper urged the North to halt its nuclear programme in exchange for Chinese protection.

With a U.S. aircraft carrier group steaming to the area and tension rising, South Korea said it believed the United States would consult it before any pre-emptive strike against the North.

Fears have been growing that the reclusive North could soon conduct its sixth nuclear test or more missile launches in defiance of U.N. sanctions and stark warnings from the United States that a policy of patience was over.

China, North Korea’s sole major ally and benefactor, which nevertheless opposes its weapons programme, has called for talks leading to a peaceful resolution and the denuclearisation of the peninsula.

“Military force cannot resolve the issue,” Chinese Foreign Minister Wang Yi told reporters in Beijing.

“Amid challenge there is opportunity. Amid tensions we will also find a kind of opportunity to return to talks.”

While U.S. President Donald Trump has put North Korea on notice that he would not tolerate any provocation, U.S. officials have said his administration was focusing its strategy on tougher economic sanctions.

Trump has diverted the USS Carl Vinson aircraft carrier group towards the Korean peninsula, which could take more than a week to arrive, in a show of force aimed at deterring North Korea from conducting another nuclear test or launching more missiles to coincide with important events and anniversaries.

Speculation about U.S. military action grew after the U.S. Navy fired 59 Tomahawk missiles at a Syrian airfield last week in response to a deadly gas attack.

Wang warned that history would hold any instigator to account.

“Whoever provokes the situation, whoever continues to make trouble in this place, they will have to assume historical responsibility,” Wang said.

South Korean Foreign Minister Yun Byung-se told parliament in Seoul he believed Washington would consult Seoul if it was considering a pre-emptive strike. The United States has about 28,500 troops in South Korea.

A Washington-based think-tank that monitors North Korea, 38 North, said satellite images on Wednesday showed activity around the North’s Punggye-ri nuclear test site on the east coast that indicated it was ready for a new test.

South Korean officials said there were no new signs to indicate a test was more likely, although they also said the North appeared ready to conduct a test at any time.

An influential state-backed Chinese newspaper said the best option for North Korea and its leader, Kim Jong Un, was to give up its nuclear programme, and China would protect it if it did.

“As soon as North Korea complies with China’s declared advice and suspends nuclear activities … China will actively work to protect the security of a denuclearised North Korean nation and regime,” said an editorial in the Global Times, which is published by the Communist party’s People’s Daily.

Japanese Prime Minister Shinzo Abe underscored fears about threats from North Korea, telling parliament in Tokyo that Pyongyang could have the capacity to deliver missiles equipped with sarin nerve gas.

A senior Japanese diplomat said the United States was putting “maximum pressure” on North Korea to resolve issues peacefully while putting responsibility on China to sway its old ally.

“We will watch what action China takes,” the diplomat said.

While Japan did not see a high risk of military action, it expected to be consulted by the United States if it decided to attack. North Korea has about 350 missiles that can hit Japan.

“DAY OF THE SUN”

Scores of foreign journalists gathered in Pyongyang for North Korea’s biggest national day, the “Day of the Sun”, were taken to what officials billed as a “big and important event” early on Thursday.

It turned out to be the opening of a new street in the centre of the capital, attended by leader Kim.

North Korea marks the 105th anniversary of the birth of state founder Kim Il Sung on Saturday. In 2012, it tried but failed to launch a long-range rocket carrying a satellite to mark the date and tested a newly developed intermediate-range missile last year.

North Korea’s official KCNA news agency said early on Thursday that Kim Jong Un had guided training of the army’s special operation forces jumping from aircraft.

On Tuesday, North Korea warned of a nuclear attack on the United States at any sign of American aggression. The North is technically at war with the United States and South Korea after the 1950-53 Korean War ended in a truce and not a peace treaty.

The North regularly threatens to destroy both countries.

U.S. officials said Trump was considering sanctions that could include an oil embargo, banning North Korea’s airline, intercepting cargo ships, and punishing Chinese banks doing business with it.

“There’s a whole host of things that are possible, all the way up to what’s essentially a trade quarantine on North Korea,” one official, speaking on condition of anonymity, told Reuters in Washington.

Customs data in Beijing on Thursday showed that China’s coal imports from North Korea had plunged 51.6 percent in the first three months in 2017 from a year ago.

China suspended issue of permits for coal imports from North Korea on Feb. 18 as part of its effort to implement U.N. sanctions.

Trump and Chinese President Xi Jinping spoke by telephone on Wednesday, just days after they met in the United States for the first time, underscoring the sense of urgency about North Korea.

Trump said on Twitter his call with Xi was a “very good” discussion of the “menace of North Korea”. He said later on Wednesday the United States was prepared to tackle the crisis without China, if necessary.

From TruNews

Posted by The NON-Conformist

‘We are sending an armada’: Trump ready to eliminate N. Korean ‘menace’ with or without China

The US is looking forward to working with China to solve the North Korean nuclear threat. But while Washington is mustering its forces in the Korean peninsula, Beijing insists on finding a peaceful solution to Pyongyang’s “denuclearization.”

Less than a week after US President Donald Trump met with his Chinese counterpart Xi Jinping, the two leaders once again engaged on Wednesday, where among other things they discussed the North Korean threat.

“President Xi wants to do the right thing. We had a very good bonding, I think we had a very good chemistry together, I think he wants to help us with North Korea,” Trump said after the meeting with NATO’s chief in Washington

“We talked trade, we talked a lot of things, and I said the way you’re going to make a good trade deal is to help us with North Korea, otherwise we’re just going to go it alone, that’ll be all right too, but going it alone means going with lots of other nations,” Trump added.

The Chinese leader said China is committed to the “denuclearization” of the Korean Peninsula but “insists on preserving peace and stability.”

“China advocates to resolve the issue through peaceful means, and is willing to maintain communication and coordination with the US on the Korean Peninsula issue,” President Xi’s readout said, as quoted by the Times magazine.

China has already begun to apply economic pressure on the North by refusing to import Pyongyang’s coal.

“I really think that China’s going to try very hard and has already started. A lot of the coal boats have already been turned back,” Trump told Fox Business Network on Wednesday, adding that “that’s a big step.”

China’s official Global Times daily said Beijing would support harsher UN sanctions against North Korea, including “strictly limiting” oil exports to Pyongyang.

US-China rapprochement on the Korean issue comes after a series of Trump statements which explicitly stated that Washington might act alone if China refuses to participate in an American campaign against North Korea.

Following Friday’s US surprise strike on a Syrian airbase – the first American action undertaken directly against President Bashar Assad – many expressed fears that Washington may opt to strike North Korea too. US military buildup in the region suggests that direct military action against the North could be a real option for the new administration.

When asked by Fox on Wednesday of what his strategy is with the North, Trump said he doesn’t reveal those things.

“I’m not like Obama,” the US president said, criticizing the former administration for announcing plans to strike the Iraqi city of Mosul.

Russia’s Foreign Ministry said earlier it is deeply concerned with US policy over North Korea.

“We are really worried about what Washington has in mind for North Korea after it hinted at the possibility of a unilateral military scenario,” the ministry said in a statement.

Unease over North Korea is growing with fears that Pyongyang may soon conduct a sixth nuclear test, possibly to coincide with Saturday’s 105th anniversary of the birth of Kim Il-sung, North Korea’s founding father and grandfather of the current ruler.

While China insists on a peaceful solution, Washington continues to flex its muscles in the region. Last week Washington rerouted its Carl Vinson towards the Korean peninsula in a show of force.

“We are sending an armada. Very powerful,” Trump told Fox. “We have submarines. Very powerful. Far more powerful than the aircraft carrier. That I can tell you.”

Trump said, referring to North Korean leader Kim Jong-un, that “he is doing the wrong thing.”

The US president’s comments came the day after Pyongyang once again threatened to retaliate against the US and its allies.

“Our revolutionary strong army is keenly watching every move by enemy elements with our nuclear sight focused on the US invasionary bases not only in South Korea and the Pacific operation theater but also in the US mainland,” North Korea’s official Rodong Sinmun newspaper said.

To exacerbate regional tensions even further, Japan is reportedly preparing to send several of its warships to join the US armada, informed sources told both Reuters and the Kyodo news agencies.

Furthermore, Washington has sent a nuclear detection plane, the WC-135 Constant Phoenix to Kadena Air Base last Friday evening, Stars and Stripes, the official newspaper of the US Armed Forces reported. The military plane specializes in radiation detection and collects air samples and debris after nuclear detonations using external flow-through devices.

Washington has allegedly sent Seal Team 6 – which killed Osama bin Laden in May 2011 – to participate in the Foal Eagle and Key Resolve exercises being conducted in the region from March 7 to April 30, JoongAng Daily reported Wednesday, citing South Korea’s Ministry of National Defense.

The Seal Team 6 will also be joined by the American Delta Force, which specializes in hostage rescue and counterterrorism. As part of the multinational force operation, both US special forces teams will lead a rehearsal of removing Kim Jong-un and destroying of North Korea’s nuclear weapons.

“It will send a very strong message to North Korea, which is constantly carrying out military provocations,” a ministry official told JoongAng Daily.

From Russia Today

Posted by The NON-Conformist

Chinese state media hits back at claims of racist ‘Star Wars’ poster

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Images: Ray Kwong via Twitter

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Chinese state media has hit back against claims that the poster for “Star Wars: The Force Awakens” used in mainland China deliberately leaves out or downplays characters of color.

Fans complained on Twitter earlier this week that British actor John Boyega, who plays Finn in the movie, had been shrunk on the Chinese poster. Other characters played by non-white characters, including Oscar Isaac’s Poe Dameron and Lupita Nyong’o’s Maz Kanata were missing entirely, as was Chewbacca the Wookiee.

More from CNN.com

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Anthropologist Jane Goodall: China is pillaging Africa like an old colonial power

China is exploiting Africa’s resources just like European colonisers did, with disastrous effects for the environment, acclaimed primatologist Jane Goodall has told AFP.

Image: wikipedia

On the eve of her 80th birthday, the fiery British wildlife crusader is whizzing across the world giving a series of lectures on the threats to our planet.

And the rising world power’s involvement on the continent especially raises alarms when it comes to her beloved chimpanzees and wildlife habitats.

During the last decade China has been investing heavily in African natural resources, developing mines, oil wells and running related construction companies.

Activists accuse Chinese firms of paying little attention to the environmental impact of their race for resources.

“In Africa, China is merely doing what the colonialist did. They want raw materials for their economic growth, just as the colonialists were going into Africa and taking the natural resources, leaving people poorer,” she told AFP in an interview in Johannesburg.

More from The Raw Story

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Dr. Oz sounds the warning on Chicken from China

Image: prevention

Watch the clip here!

Posted by the NON-Conformist