China
China does not like the coup in Myanmar
Author: Enze Han, HKU
Since the military coup in Myanmar on 1 February 2021, there have been reports and allegations that China approves of or is able to spin the military takeover to its advantage. This is unlikely to be true.
Beijing has always considered the Tatmadaw to be incompetent and corrupt. Its mysterious behaviour and unpredictable nature has not sat well with the Chinese government in the past. When the military-backed Thein Sein government came into office in 2011, for example, the generals turned their backs on China, even though Beijing had previously tried to protect the government from international sanctions.
It was military men who turned out to be most damaging to China’s economic and strategic interests. Cancelations and threats to renegotiate existing contracts for Chinese investment in Myanmar, as well as warming relations with the United States during the Obama administration’s ‘Pivot to Asia’, sidelined China. A case in point is the shelved Myitsone Dam, where the Chinese company that invested in the initial stage of the project suffered massive financial losses. Beijing tends to view the Myanmar military as ungrateful, rapacious, greedy and a poor business partner.
Meanwhile, the past five years of National League for Democracy (NLD) rule under the leadership of Aung San Suu Kyi led Beijing to realise potential in working with her government. Aung San Suu Kyi visited Beijing relatively frequently and has remarked on the need to pursue friendly relations with China for the sake of Myanmar’s economic development. Bilateral economic relations have improved tremendously under the NLD government, with Myanmar actively participating in the China–Myanmar Economic Corridor as part of China’s Belt and Road Initiative. Recently, Aung San Suu Kyi’s government also signed the Regional Comprehensive Economic Partnership (RCEP), a free trade agreement that China has a strong interest in.
Myanmar has experienced significant economic growth under the NLD. This is in line with China’s economic interests in the region. China today is not only interested in the country’s natural resources, but is also looking for a market to sell its products.
China’s investment in the country is dependent on whether Myanmar has a stable, internationally accepted government. It would not be logical for China to support a military government sanctioned by the international community. If Myanmar comes under international sanctions again and its economy deteriorates, China loses a market for its products. China does not seem to benefit from a military coup in Myanmar.
Yet it is not possible for China to openly condemn the military’s actions because it has set no such precedent. The Chinese government does not condemn regime changes in other countries and Beijing is in no position to make an exception in Myanmar’s case.
Officially, non-interference in the domestic affairs of other countries has long been a core principle of China’s foreign policy. There is no reason to expect China to make exception now. The recent statement issued by the Chinese Ministry of Foreign Affairs on Myanmar may be interpreted as urging all parties to peacefully solve the problem in accordance with Myanmar’s Constitution, a relatively soft statement.
While the UN Security Council (UNSC) released a press statement on 4 February expressing ‘deep concern’ at the coup, China and Russia blocked stronger language condemning the military takeover. This is consistent with China’s previous practices. Beijing has never supported any such condemnations at the United Nations and this time is no exception. This may not look good for China, particularly in the context of the negative portrayals its government faces in international media as well as domestically in Myanmar. But the UN statement does call for the release of Aung San Suu Kyi and others in detention, expressing support for the democratic transition in Myanmar. It says UNSC members ‘stressed the need to uphold democratic institutions and processes, refrain from violence and fully respect human rights, fundamental freedoms and the rule of law’ and encourage ‘the pursuance of dialogue and reconciliation in accordance with the will and interests of the people of Myanmar’.
Explit language in support of Aung San Suu Kyi and her government and the disapproval for the coup indicates that China has come around to offer its tacit agreement that the coup is not the right thing.
While China may not like the events unfolding in Myanmar, it is unlikely to openly…
China
The Latest Updates on China’s Visa-Free Policies
China has fully reopened its borders, allowing international tourism to recover. Visa-free travel policies are reinstated, and visa fees for foreign travelers will be reduced by 25% from December 11, 2023, to December 31, 2024. China and Singapore are also pursuing a 30-day visa-free travel arrangement.
China has fully reopened its borders, promising recovery of international tourism and travel. Many of the visa-free travel policies that were in place prior to the pandemic have therefore come back into effect, enabling people from a wide range of countries to visit
UPDATE (December 8, 2023): On December 8, 2023, the Ministry of Foreign Affairs released the Notice on Temporary Reduction of Fees for Applying Visa to China. According to this notice, during the period from December 11, 2023, to December 31, 2024, China shall cut visa fees by 25 percent across the board for foreign travelers. For more details, please consult with your local Chinese embassy or consulate.
UPDATE (December 7, 2023): China and Singapore are seeking to establish a mutual 30-day visa-free travel arrangement to boost people exchanges between the two countries, according to Reuters. At the time of writing, no further details have been released regarding the timeline or the eligibility, requirement, and application procedures of this new arrangement. Click here for more information regarding this mutual 30-day visa-free travel between China and Singapore.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Analysis of UK Investments in China for 2023: Evaluating Deals, Values, M&A, and Investments
British Government underwent reshuffle with pro-China David Cameron as Foreign Minister. Possible mild rapprochement with Beijing. Analysis of UK investments in China this year reveals potential trends. Report includes unique Q1-Q3 data and predicts outlook for 2024.
By Chris Devonshire-Ellis & Henry Tillman
With a reshuffle in the British Government and ex-Prime Minister – and generally pro-China politician David Cameron now as the UK’s Foreign Minister, there have been early signs of a potential mild rapprochement in the British governments overall attitude towards Beijing.
But before people get carried away, we can look at what investments the UK has made into China this year – as investments made while anti-China politics have tended to be the norm are typically indicative of stronger trends. In this report I include unique data that has not previously been made public, and examine the Q1-Q3 investment trends to see what may lie ahead for 2024.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Ratings agency cuts China’s credit outlook
Financially strapped local governments and state-owned enterprises pose a risk to China’s future economic growth, the ratings agency Moody’s said today in a report downgrading the country’s credit outlook from stable to negative.
Growing evidence suggests that the central government will be required to shore up the debt-laden entities, creating “broad downside risks to China’s fiscal, economic and institutional strength,” Moody’s said.
Local governments are thought to have accumulated trillions of dollars of debt due to spending during the COVID pandemic and a loss of income due to a troubled real estate market.
Despite the challenges, Moody’s maintained China’s overall credit rating of A1, which it describes as low-risk though not the safest category of investment. Moody’s said the rating reflects its belief in the country’s “financial and institutional resources to manage the transition in an orderly fashion.”
“Its economy’s vast size and robust, albeit slowing, potential growth rate, support its high shock absorption capacity,” Moody’s said.
Even so, the outlook downgrade signals some concern about China’s future creditworthiness.
In a statement, China’s Foreign Ministry said it was disappointed in the ratings change and that Moody’s concerns about its growth and financial stability were “unnecessary.”
“In recent years, through the continuous efforts of relevant departments and local governments, China has established a system to prevent and resolve the risks of local government debt,” the ministry said. “The trend of disorderly and illegal borrowing by local governments has been initially curbed, and positive results have been achieved in the disposal of local government debt.”
Moody’s projects China’s annual growth rate will be 4% in 2024 and 2025 but average 3.8% from 2026 to 2030, at which time it might drop again to 3.5%.
Derek Scissors, the chief economist at China Beige Book, a firm that analyzes China’s economy for investors, said in an email that the downgrade was to be expected.
“It’s a recognition of long-standing conditions, not a new development,” said Scissors, who is also a senior fellow at the free-market think tank American Enterprise Institute in Washington. “I think growth will be faster than Moody’s thinks in 2024 and decelerate more than they think after that.”
Fees from local land sales account for nearly 40% of the revenue to local and regional governments. But China’s real-estate sector has been hit hard by overbuilding. One giant, Evergrande, defaulted under massive debt last year, triggering a broader real estate crisis.
Moody’s report said that “the downsizing of the property sector is a major structural shift in China’s growth drivers which is ongoing and could represent a more significant drag to China’s overall economic growth rate than currently assessed.”
Edited by Tara McKelvey
Read the rest of this article here >>> Ratings agency cuts China’s credit outlook
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