China
Central Asian elites choose China over Russia
Author: Jon Yuan Jiang
Since 2019, more than 40 protests were held against ‘Chinese expansion’ in Central Asia. Yet Central Asian elites have hardly had a bad word to say. On the contrary, they suppressed these protests, denied that China’s goal was expansion and even requested their publics be grateful to China. No wonder some Russian commentators are worried about Russia’s waning influence.
The rationale to explain these Central Asian elites’ choices is that they may be better off embracing China while subtly distancing themselves from Russia, as Beijing increasingly aligns with its Central Asian counterparts with greater success than Moscow. Despite Central Asian countries being independent for three decades, it is common to find Russian assertions that they still effectively own the region. Some Russian officials have even publicly claimed that the entire territory of Kazakhstan was a gift from Russia, which was denounced severely among Kazakh elites.
Arguments about expansion and loss of sovereignty are dubious in Central Asia. Nowadays, Central Asian elites enjoy full sovereignty to defend their national interests. When the legislation around long-term land leases by foreign countries stirred up massive protests against the Kazakhstan government and Chinese influence, the bill was ditched and Beijing did not react. Kazakh elites also rejected Russian President Vladimir Putin’s proposal to construct nuclear power plants there. When Turkmenistan closed Russian language courses, the local Russian embassy expressed regret, but nothing tougher.
Numerous ethnic Russians live in Central Asia and the annexation of Crimea looms as a precedent. Central Asian elites might never express their fear of Russian annexation freely, but it is certainly a concern. In contrast, very few ethnic Han Chinese reside in Central Asia. The cardinal interest of China in this part of the world is to eliminate terrorism and separatism, purchase resources and trade with Europe through Central Asia. None of these interests constitute any potential territorial threat to Central Asia.
The dubious benefits of alignment with Russia’s stagnating economy pale in comparison to China’s economic might. With the implementation of the Belt and Road Initiative (BRI), China was a larger trading partner than Russia for most Central Asian nations by 2019. As Alexander Grishin noted, Chinese investment has now surpassed Russia in almost all Central Asian countries. Russian investment in Kazakhstan in 2016 was just over US$12 billion, whereas Chinese investment, according to official data, exceeded US$20 billion. Unofficial figures of Chinese investment ranged from US$55 billion to US$80 billion.
As Benno Zogg argued, compared to the economic power of China, ‘particularly the volume of funds for infrastructure in the framework of the BRI, Russia and its rigid, protectionist, and politicised Eurasian projects pale’. Russia is a direct competitor to Central Asia’s natural resources exports to the Chinese market, which may push Central Asian elites to the Chinese side.
According to Adil Kaukenov and Bakhtiyor Ergashev, Moscow consulted minimally with Central Asian partners concerning Eurasian integration, preferring to offer feelings of kinship and shared history rather than practical benefits. This may be effective in winning over the public and some of the more sensationalist media in the region, but it is much less persuasive to Central Asian elites who see the relationship with China as more business-like.
This explains why Central Asian elites have endeavoured to ‘de-Russianise’ themselves to enhance their own national identity by promoting local languages. Uzbekistan and Kazakhstan deliberately implemented the latinisation of their national languages, eschewing the Russian Cyrillic alphabet. In this context, increasing cooperation with China — which also entails enhancing its influence — not only accords with the economic interests and diversity of Central Asian nations, but also indirectly promotes their nation-building efforts.
The leadership shift in Central Asia may reflect their willingness to negotiate more with Beijing. Kazakhstan President Kassym-Jomart Tokayev is a fluent Mandarin speaker with diplomatic experience and connections in China. Former deputy prime minister Dariga Nazarbayev, the eldest daughter of the first president of Kazakhstan, extolled the virtue of learning Chinese, arguing closer ties to China is Kazakhstan’s destiny. The incumbent Kyrgyzstan President, Sadyr Japarov, was purportedly…
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.
China
A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
The application procedures for business visas to China have been simplified, with most foreigners now able to apply for an M/F visa using only an invitation letter from a Chinese company. Some countries are eligible for visa-free entry. However, a Verification Letter of Invitation may still be needed in certain cases. Consult the local Chinese embassy for confirmation.
In light of recent developments, the application procedures for business visas to China have undergone substantial simplification. Most foreigners can now apply for an M/F visa using only the invitation letter issued by a Chinese company. Additionally, citizens of certain countries are eligible to enter China without a visa and stay for up to 144 hours or even 15 days.
However, it’s important to note that some applicants may still need to apply for a “Verification Letter of Invitation (邀请核实单)” when applying for an M/F visa to China. In this article, we will introduce what a Verification Letter of Invitation is, who needs to apply for it, and the potential risks.
It’s important to note that in most cases, the invitation letter provided by the inviting unit (whether a public entity or a company) is sufficient for M/F visa applications. The Verification Letter for Invitation is only required when the Chinese embassies or consulates in certain countries specifically ask for the document.
Meanwhile, it is also essential to note that obtaining a Verification Letter for Invitation does not guarantee visa approval. The final decision on granting a visa rests with the Chinese embassy abroad, based on the specific circumstances of the applicant.
Based on current information, foreign applicants in Sri Lanka and most Middle East countries – such as Turkey, Iran, Afghanistan, Syria, Pakistan, and so on – need to submit a Verification Letter for Invitation when they apply for a visa to China.
That said, a Verification Letter for Invitation might not be required in a few Middle East countries, such as Saudi Arabia. Therefore, we suggest that foreign applicants consult with their the local Chinese embassy or consulate to confirm in advance.
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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- Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
- A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
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