Connect with us
//pagead2.googlesyndication.com/pagead/js/adsbygoogle.js (adsbygoogle = window.adsbygoogle || []).push({});

China

Japan needs to navigate a pathway between the United States and China

Published

on

Japanese Prime Minister Fumio Kishida speaks to reporters at the premier's office in Tokyo on 2 December 2021 (Photo: Kyodo via Reuters).

Author: Editorial Board, ANU

Japan’s Fast Retailing CEO Tadashi Yanai, who runs the Uniqlo clothing chain, declared that his company wouldn’t be choosing between the United States and China in an interview with financial daily Nikkei Asia last week. ‘Japan can’t survive without being an open country’, Yanai said. Japanese companies caught between the United States and China ‘need to acknowledge that Japan has nothing. Japan has no choice but to make money in markets across the world’.

Yanai’s decision to make no comment on whether the company uses cotton from Xinjiang is emblematic of his approach to geopolitical affairs. ‘I want to be neutral between the United States and China’, he said. ‘The US approach is to force companies to show their allegiance. I wanted to show that I won’t play that game’.

When it comes to the economic crunch point, what’s good for Uniqlo is probably also good for Japan. But the Japanese government is yet to define a pathway through US–China rivalry and political assertiveness that might make Yanai’s posture a viable national strategy.

The Japanese prosperity that has come with globalisation and technological advancement has fundamentally changed the regional and global balance of power. The rise of China as the world’s second largest and soon to be largest economy poses a major challenge to the established global order.

The whole region is navigating these tricky changes, but Japan is in the cockpit.

The pressures on global markets and political and multilateral institutions and systems are unprecedented. China’s political system amplifies the uncertainty the region faces about how tensions with Beijing can be dealt with. Political and military power has followed China’s economic power, and the country is no longer hiding its strength and biding its time.

China is Japan’s and Asia’s largest trading and economic partner; Japan is the largest source of foreign direct investment for China. It is reasonable for China to have its power reflected in international efforts to shape global rules and for it to want to secure its interests in its immediate neighbourhood.

But the tip towards political coercion is a tip too far. China’s assertiveness in international dealings and its use of coercion, particularly in its immediate regional neighbourhood — earlier against Japan and recently more blatantly against Australia — have aggravated uncertainties about the nature of its rise. There is a growing attenuation of trust between China and other powers.

The United States’ responses to the rise of China have varied, grappling for a balance between engagement, competition and containment. In recent years, fears of the consequences of China’s challenge to US economic power have led to a trade war, technological decoupling and strategic competition and pressure on US allies and partners to make choices that favour the United States whatever the cost.

Although the rise of Japan in the 1980s was also met with a similarly confrontational American response, Japan was under the American security umbrella and had a political system that was a little less unfamiliar. The rise of protectionism in the United States, driven by an uneven recovery from the global financial crisis in 2008 and politically exploitable domestic socioeconomic disparities, has added to these pressures.

The pressure on US allies to decouple their trade and technology from China has grown. The multilateralism that helps to restrain and shape great power settlements and is essential to Japan’s prosperity and security, is harder to sustain.

At a time when strategic innovation is much needed to define a pathway through, Japanese political leadership is entangled in established ways of thinking from the past.

In our lead article this week, Ben Ascione observes that ‘unless [Japanese Prime Minister Fumio] Kishida can assert his control over the LDP after the July 2022 upper house election and build more than lukewarm public support he will find it difficult to exercise the levers of the prime minister’s office to strike a new policy course’.

‘Japanese democracy is at its weakest point in the post-war era’, Ascione laments, and there is no cut-through, hard-edged political debate about domestic or pressing foreign policy issues. Though he hails from a fine liberal tradition in Japanese conservative politics (the Kochikai faction which boasts former prime ministers Hayato Ikeda, Masayoshi Ohira, Zenko Suzuki and Kiichi Miyazawa) Kishida appears bound to the nationalist conservative…

Read the rest of this article on East Asia Forum

Continue Reading

China

Trends and Future Prospects of Bilateral Direct Investment between China and Germany

Published

on

China and Germany experienced a decline in direct investment in 2023 due to global economic uncertainty and policy changes. Despite this, China remains an attractive destination for German FDI. Key industries like automotive and advanced manufacturing continue to draw investors, although FDI outflows from Germany to China decreased by 30% in the first three quarters of 2023. Despite this, the actual use of foreign capital from Germany to China increased by 21% in the same period according to MOFCOM. The Deutsche Bundesbank’s FDI data and MOFCOM’s actual use of foreign capital provide different perspectives on the investment trends between the two countries.


Direct investment between China and Germany declined in 2023, due to a range of factors from global economic uncertainty to policy changes. However, China remains an important destination for German foreign direct investment (FDI), and key industries in both countries continue to excite investors. We look at the latest direct investment data between Germany and China to analyze the latest trends and discuss key factors that could shape future business and commercial ties.

Direct investment between China and Germany has undergone profound changes over the past decade. An increasingly complex investment environment for companies in both countries has led to falling two-way FDI figures in the first three quarters of 2023, in stark contrast to positive trends seen in 2022.

At the same time, industries with high growth potential, such as automotive and advanced manufacturing, continue to attract German companies to China, and high levels of reinvested earnings suggest established firms are doubling down on their commitments in the Chinese market. In Germany, the potential for electric vehicle (EV) sales is buoying otherwise low investment among Chinese companies.

According to data from Deutsche Bundesbank, Germany’s central bank, total FDI outflows from Germany to China fell in the first three quarters of 2023, declining by 30 percent to a total of EUR 7.98 billion.

This is a marked reversal of trends from 2022, when FDI flows from Germany to China reached a record EUR 11.4 billion, up 14.7 percent year-on-year.

However, according to China’s Ministry of Commerce (MOFCOM), the actual use of foreign capital from Germany to China increased by 21 percent year-on-year in the first eight months of 2023. The Deutsche Bundesbank’s FDI data, which follows standards set by the IMF, the OECD, and the European Central Bank (ECB), includes a broader scope of transactions within its direct investment data, including, broadly, direct investment positions, direct investment income flows, and direct investment financial flows.

Meanwhile, the actual use of foreign capital recorded by MOFCOM includes contracted foreign capital that has been concluded, including the registered and working capital paid by foreign investors, as well as the transaction consideration paid for the transferred equity of domestic investors.

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.

Continue Reading

China

Manila blasts China’s ‘unprovoked aggression’ in latest South China Sea incident

Published

on

China’s coast guard on Saturday fired a water cannon at a Philippine supply boat in disputed waters in the South China Sea, causing “significant damages to the vessel” and injuring its crew, the Philippine coast guard said.

Manila was attempting to resupply troops stationed on a ship at the Second Thomas Shoal, known locally as Ayungin Shoal, when the Chinese coast guard and maritime militia “harassed, blocked, deployed water cannons, and executed dangerous maneuvers against the routine RoRe (rotation and resupply) mission,” said the Philippine National Task Force for the West Philippine Sea.

The West Philippine Sea is the part of the South China Sea that Manila claims as its jurisdiction.

The Chinese coast guard also set up “a floating barrier” to block access to shoal where Manila ran aground an old warship, BRP Sierra Madre, to serve as a military outpost.

The Philippine task force condemned China’s “unprovoked aggression, coercion, and dangerous maneuvers.”

Philippines’ RoRe missions have been regularly blocked by China’s coast guard, but this is the first time a barrier was set up near the shoal. 

The Philippine coast guard nevertheless claimed that the mission on Saturday was accomplished.

Potential consequences

The Second Thomas Shoal lies within the country’s exclusive economic zone where Manila holds sovereign rights. 

China, however, claims historic rights over most of the South China Sea, including the Spratly archipelago, which the shoal forms a part of.

A Chinese foreign ministry’s spokesperson on Saturday said the Philippine supply vessel “intruded” into the waters near the shoal, called Ren’ai Jiao in Chinese, “without permission from the Chinese government.”

“China coast guard took necessary measures at sea in accordance with law to safeguard China’s rights, firmly obstructed the Philippines’ vessels, and foiled the Philippines’ attempt,” the ministry said.

“If the Philippines insists on going its own way, China will continue to adopt resolute measures,” the spokesperson said, warning that Manila “should be prepared to bear all potential consequences.”

Chinese Maritime Militia vessels near the Second Thomas Shoal in the South China Sea, March 5, 2024. (Adrian Portugal/Reuters)

U.S. Ambassador to the Philippines MaryKay Carlson wrote on social media platform X that her country “stands with the Philippines” against China’s maneuvers.

Beijing’s “interference with the Philippines’ freedom of navigation violates international law and threatens a free and open Indo-Pacific,” she wrote.

Australian Ambassador to the Philippines Hae Kyong Yu also said that Canberra shares the Philippines’ “serious concerns about dangerous conduct by China’s vessels adjacent to Second Thomas Shoal.” 

“This is part of a pattern of deeply concerning behavior,” Yu wrote on X.

Edited by Jim Snyder.

Read the rest of this article here >>> Manila blasts China’s ‘unprovoked aggression’ in latest South China Sea incident

Continue Reading

China

Foreigners in China: 2024 Living and Working Guidelines

Published

on

China’s Ministry of Commerce released updated guidelines for foreign businesspersons living and working in China in 2024. The guidelines cover accommodations, visas, work permits, and emergency protocols. It also outlines responsibilities regarding social security premiums and individual income tax obligations. prompt registration for temporary accommodation is required upon arrival.


The updated 2024 guidelines for foreign businesspersons living and working in China, released by the country’s Ministry of Commerce, outline essential procedures and considerations covering accommodations, visas, work permits, and emergency protocols.

On January 25, 2024, China’s Ministry of Commerce (MOFCOM) released the latest version of the Guidelines for Foreign Businessmen to Live and Work in China (hereinafter referred to as the “guidelines”).

The document is divided into four main sections, labeled as:

Furthermore, the guidelines elucidate the regulatory framework governing foreign businessperson’s responsibilities concerning social security premiums and individual income tax obligations.

This article provides a comprehensive overview of the guidelines, delving into their significance and implications for foreign businesspersons in China.

Upon arrival in China, prompt registration for temporary accommodation is required.

If staying in a hotel, registration can be facilitated by the hotel staff upon presentation of a valid passport or international travel documents.

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.

Continue Reading