China
Middle power diplomacy essential to secure Asia against big power rivalry
Author: Editorial Board, ANU
There will be no resolution of the big problems of our age without the big powers, notably the United States and China, being willing parties to their settlement. And success will depend critically on the trust that each puts in the other’s stake in the game.
On the problems of climate change and the transformation of the global energy economy and technologies that are needed to effect a reduction in man-made global warming; on arms control and limiting the spread of weapons of mass destruction; on revamping global trade and economic governance to make it fit to manage the hyper-interdependent and digitally wired economy of the 21st century: if the United States and China don’t both buy into the solutions, there will be no solutions.
Yet what is increasingly plain for all to see is that these two great powers, left to their own devices, are incapable of resolving these problems alone, without damage of consequence to the global order over which they now imperfectly have the pretension to preside.
To be sure, the two big powers account for a considerable part of the world economy and military power. Yet together they make up just over two-fifths of global production, and under a quarter of global trade, although they account for over half of global military expenditure, as the balance of economic and military power between them tilts steadily towards China.
In 1960, the United States itself generated two-fifths of global GDP and 15 per cent of global trade. The other substantial 60 per cent of global production and 75 per cent of global trade, in 2020, belonged to Europe (around 16 per cent of global GDP and 14 per cent of trade) and a range of middle powers.
If the United States had the will to lead the global economic and trading system today — and patently it does not, as first President Trump prosecuted and now President Biden is prosecuting each their own populist versions of ‘America First’ — it doesn’t have the weight or the capacity.
Certainly the three-hour conversation during the virtual summit between US President Joe Biden and Chinese President Xi Jinping last week exuded a welcome cosiness and brought a worthy initiative to talk about nuclear missiles. But on the other big issue of the economy and global governance there was a troubling, largely empty set.
Indeed, the United States and China appear to be doing their best to undermine global trade governance. The Phase One trade deal between China and the United States is not free trade, it is managed trade — China agreed to buy quotas of US commodities. In a deal done earlier this month, the European Union lifted the retaliatory tariffs on Harley Davidsons and Kentucky Bourbon from the United States in exchange for allowing quota-ed volumes of European steel and aluminium into the United States. US protectionism that ramped up under former President Trump remains and the United States is retreating without shame to the use of voluntary export restraints and managed trade of the 1980s.
As Tom Westland explains in the first of our two lead articles this week, ‘in economics as in sport, competition is best managed by neutral umpires, not by the participants themselves’. He points out that ‘it’s not clear what Xi’s and Biden’s responsibly managed competition will look like. [But if] it looks anything like the managed trade that now governs the economic interactions of the world’s two largest economies, then “competition” is a wild misnomer’.
If the middle powers, who constitute the major third force, stand by and let the United States and China carve up the world, they will surrender their national interests and international public good to a duumvirate of big power interests. As Westland points out, ‘the US-China “Phase One” trade deal, represents the worst kind of anti-competitive policy kludge, designed to protect politically favoured industries in the United States and kicking out Australian and Canadian farmers and gas suppliers who can produce more efficiently than their American counterparts’.
These big geopolitical and economic fault-lines that threaten global prosperity and security today run through East Asia’s backyard. The middle powers — Australia, Japan, South Korea and ASEAN among them — that comprise half the region alongside China now face the challenge of devising strategies that embrace their major economic partner on one side and their major security ally or partner on the other. But at the same time, they need to protect their interests and the…
China
China deepens engagement with new Indonesian president as top diplomat visits Jakarta
China’s top diplomat met the outgoing Indonesian president and his successor in Jakarta on Thursday, as Beijing deepened its engagement with future leader Prabowo Subianto, amid a competition for regional influence with the United States.
The meeting with Chinese Foreign Minister Wang Yi was part of a joint commitment to advance the partnership between the two countries, said Prabowo, who visited Beijing in early April after his landslide win in the February general election.
“It is a great honor for me to welcome him [Wang] today. Thank you for the kind reception I received in Beijing a few weeks ago,” Prabowo said, according to an Indonesian defense ministry statement.
Chinese President Xi Jinping had invited Prabowo to visit, and the latter accepting the invitation raised eyebrows in Indonesia because no president-elect had made a foreign visit such as this one without being sworn in. China is Indonesia’s largest trading partner.
Wang, too, mentioned Prabowo’s Beijing trip, according to the same statement.
“We really appreciate and welcome Defense Minister Prabowo’s visit to China,” he said.
“We are committed to continuing to increase bilateral cooperation with Indonesia, both in the defense sector and other fields such as economic, social and cultural.”
Wang is scheduled to go to East Nusa Tenggara province on Friday to attend the China-Indonesia High-Level Dialogue Cooperation Mechanism, a process to support more effective bilateral cooperation. His Jakarta stop was the first of a six-day tour that also includes Cambodia and Papua New Guinea.
Prabowo and Wang discussed cooperation in the defense industry and sector, with potential measures such as educational and training collaboration, as well as joint exercises, said Brig. Gen. Edwin Adrian Sumantha, spokesman at the Indonesian defense ministry.
In fact, the ministry statement said that “China is Indonesia’s close partner and has had close bilateral relations, especially in the defense sector, for a long time.”
Of course, China has also invested billions of U.S. dollars in infrastructure projects in Indonesia, including as part of Beijing’s Belt and Road Initiative – the Jakarta-Bandung high-speed train, which began commercial operations in October 2023, is one such BRI project.
The two countries have drawn closer during outgoing President Joko “Jokowi” Widodo’s two terms, and Beijing would like that to continue as the U.S. tries to catch up with China’s gargantuan influence in Southeast Asia, analysts have said.
Indonesia, China call for ceasefire in Gaza
Both Indonesia and China shared the same position on Israel’s devastating attacks on Gaza, said Wang’s Indonesian counterpart, Retno Marsudi.
Israel’s air and ground strikes have killed more than 33,000 Palestinians following the Oct. 7 attack on the Jewish state by Palestinian militant group Hamas, which killed around 1,100 Israelis.
“We … have the same view regarding the importance of a ceasefire in Gaza and resolving the Palestinian problem fairly through two state solutions,” Retno told reporters in a joint press conference after meeting with Wang.
“Indonesia will support full Palestinian membership in the U.N. Middle East stability will not be realized without resolving the Palestinian issue.”
For his part, Wang slammed Washington for repeatedly vetoing resolutions calling for Israel to end the attacks on the Palestinian territory it occupies.
“The conflict in Gaza has lasted for half a year and caused a rare humanitarian tragedy in the 21st century,” Wang told the media at the same press conference, according to the Associated Press.
“The United Nations Security Council responded to the call of the international community and continued to review the resolution draft on the cease-fire in Gaza, but it was repeatedly vetoed by the United States.”
The conflict in the Middle East offered a strategic opportunity for China to further expand its influence in Southeast Asia, said Muhamad Arif, a lecturer in international relations at the University of Indonesia.
“China is trying to strengthen its position as a key player in the region,” Arief told BenarNews.
China could present an alternative approach to the conflict in Gaza, he said, which may find approval in Southeast Asia’s largest country, Indonesia, and other Mulism-majority states in the region, such as Malaysia and Brunei.
BenarNews is an RFA-affiliated online news organization.
Read the rest of this article here >>> China deepens engagement with new Indonesian president as top diplomat visits Jakarta
China
New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
The sixth revision of China’s Company Law is the most extensive amendment in history, impacting foreign invested enterprises with stricter rules on capital injection and corporate governance. Most FIEs must align with the New Company Law by July 1, 2024, with a deadline of December 31, 2024 for adjustments. Contact Dezan Shira & Associates for assistance.
The sixth revision of China’s Company Law represents the most extensive amendment in its history. From stricter capital injection rules to enhanced corporate governance, the changes introduced in the New Company Law have far-reaching implications for businesses, including foreign invested enterprises (FIEs) operating in or entering the China market.
Since January 1, 2020, the Company Law has governed both wholly foreign-owned enterprises (WFOEs) and joint ventures (JVs), following the enactment of the Foreign Investment Law (FIL). Most FIEs must align with the provisions of the New Company Law from July 1, 2024, while those established before January 1, 2020 have bit more time for adjustments due to the five-year grace period provided by the FIL. The final deadline for their alignment is December 31, 2024.
In this publication, we guide foreign investors through the implications of the New Company Law for existing and new FIEs and relevant stakeholders. We begin with an overview of the revision’s background and objectives, followed by a summary of key changes. Our in-depth analysis, from a foreign stakeholder perspective, illuminates the practical implications. Lastly, we explore tax impacts alongside the revisions, demonstrating how the New Company Law may shape future business transactions and arrangements.
If you or your company require assistance with Company Law adjustments in China, please do not hesitate to contact Dezan Shira & Associates. For more information, feel free to reach us via email at china@dezshira.com.
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
Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
The Lingang New Area in Shanghai has launched China’s first Cross-Border Data Service Center to facilitate data export for companies in Shanghai. The center will help with applications, data catalogs, and management, aiming to provide legal and safe cross-border data transfer mechanisms.
The Lingang New Area in Shanghai’s Pilot Free Trade Zone has launched a new cross-border data service center to provide administrative and consulting services to companies in Shanghai that need to export data out of China. The service center will help facilitate data export by accepting applications from companies for data export projects and is tasked with formulating and implementing data catalogs to facilitate data export in the area. The Shanghai cross-border data service center will provide services to companies across the whole city.
The Lingang New Area in the Shanghai Pilot Free Trade Zone has launched China’s first Cross-Border Data Service Center (the “service center”). The service center, which is jointly operated by the Cybersecurity Administration of China (CAC) and the local government, aims to further facilitate legal, safe, and convenient cross-border data transfer (CBDT) mechanisms for companies.
The service center will not only serve companies in the Lingang New Area but is also open to companies across Shanghai, and will act as an administrative service center specializing in CBDT.
In January 2024, the local government showcased a set of trial measures for the “classified and hierarchical” management of CBDT in the Lingang New Area. The measures, which have not yet been released to the public, seek to facilitate CBDT from the area by dividing data for cross-border transfer into three different risk categories: core, important, and general data.
The local government also pledged to release two data catalogs: a “general data” catalog, which will include types of data that can be transferred freely out of the Lingang New Area, and an “important data” catalog, which will be subject to restrictions. According to Zong Liang, an evaluation expert at the service center, the first draft of the general data catalog has been completed and is being submitted to the relevant superior departments for review.
In March 2024, the CAC released the final version of a set of regulations significantly facilitating CBDT for companies in the country. The new regulations increase the limits on the volume of PI that a company can handle before it is required to undergo additional compliance procedures, provide exemptions from the compliance procedures, and clarify the handling of important data.
Also in March, China released a new set of technical standards stipulating the rules for classifying three different types of data – core, important, and general data. Importantly, the standards provide guidelines for regulators and companies to identify what is considered “important” data. This means they will act as a reference for companies and regulators when assessing the types of data that can be exported, including FTZs such as the Lingang New Area.
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.
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- New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
- Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
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