China
China’s strong-arming won’t work in Marcos’ Philippines
The recent US–Philippines Balikatan military exercise was a response to China’s increased aggression in the South China Sea. China had been targeting both Filipino military personnel and small-scale fisherfolk in the Philippines’ exclusive economic zone. China’s provocations had become indiscriminate and bolder, making it difficult to ignore the situation. The 38th Balikatan exercise in April 2023 was the biggest in the three-decade history of their joint combat drills. However, it received a swift warning from Beijing who called for the cessation of such activities, stating that they could aggravate tension in the area.
The United States and the Philippines conducted the third 2+2 Ministerial Dialogue on 11 April 2023 in Washington, where they issued clear-cut statements about the South China Sea conflict. The joint statement condemned China’s illegal activities and called for compliance with the 2016 Permanent Court of Arbitration decision, which rejected Beijing’s claims on territory and maritime rights based on its ‘nine-dash line’. The statement also reiterated the importance of maintaining peace and stability in the Taiwan Strait.
Under President Ferdinand Marcos Jr, the Philippines has turned its back on the China appeasement strategy that was present under his predecessor. Former president Rodrigo Duterte moved the Philippines closer to China, which gave ample space for them to construct a mutually beneficial relationship. However, Beijing continued to conduct aggressive actions in the Philippines’ exclusive economic zone, highlighting a clear mismatch between their words and actions. As a dominant state, China has assumed that vulnerable states would allow for its aggressive actions. However, the Philippines, like many ASEAN countries, is a post-colonial state that is sensitive to the superpowers’ raw ambition to dominate and bend them against their will.
The Philippines’ ability to defend itself against China is limited, which is why it has forged closer ties with the United States. The Philippines is also crucial to US interests as a treaty ally, making it important to maintain peace and stability in the region.
Authors: Jenny Balboa, Tokyo University of Foreign Studies and Hosei University, and Shinji Takenaka, Japan Center for Economic Research
Despite careful words from Philippine officials, the latest US–Philippines Balikatan military exercise was a response to China’s increasing assertiveness in the South China Sea. China’s provocations had become indiscriminate — targeting both uniformed Filipino personnel and small-scale fisherfolk in the Philippines’ exclusive economic zone. China’s aggressive actions had become bolder, making it more difficult to turn a blind eye to the situation.
The 38th Balikatan exercise in April 2023 was the biggest in the three-decade history of their joint combat drills. The exercise did not sit well with Beijing, which immediately released a warning that such activities can aggravate tension in the area. The Chinese ambassador to the Philippines issued an upfront reproach to the Philippine government about China’s displeasure of such ‘provocative’ activities.
The United States and the Philippines promptly conducted the third 2+2 Ministerial Dialogue on 11 April 2023 in Washington. Top US–Philippines foreign affairs and defence officials issued clear-cut statements about the South China Sea conflict. The joint statement condemned China’s illegal activities and called for compliance with the 2016 Permanent Court of Arbitration decision, which rejected Beijing’s claims on territory and maritime rights based on its ‘nine-dash line’. The statement also reiterated the importance of maintaining peace and stability in the Taiwan Strait.
Under President Ferdinand Marcos Jr, the Philippines seems to have turned its back on the China appeasement strategy that characterised the foreign policy of his predecessor. Former president Rodrigo Duterte moved the Philippines closer to China by downplaying the Arbitral Tribunal award favouring the Philippines. In retrospect, Duterte provided China with ample space to construct a closer and mutually beneficial relationship with the Philippines.
Yet Beijing continued to conduct aggressive actions in the Philippines’ exclusive economic zone targeting the Philippine military and fisherfolk who are more disadvantaged. There was a clear mismatch between Beijing’s words and actions. It did not help that China reneged on many of its economic commitments to Manila. Beijing failed to fulfil its pledged investment in several big-ticket infrastructure projects.
As a dominant state that wields considerable influence in the economy and security of many countries, China seems to have assumed that vulnerable states, such as the Philippines, would tolerate its belligerent actions. China had lost sight that the Philippines — like many ASEAN countries — is a post-colonial state, sensitive to the raw ambition of superpowers to dominate and bend them against their will. Beijing overlooked the determination of many domestic actors in these countries to defend their national interest.
The country’s territorial integrity is now under threat from a hegemonic China. Given the Philippine military’s inability to defend the country against a preponderant China, the Philippines moved closer to the United States, which provides the training and capacity to protect its territory.
The Philippines’ is also vital to US interests because it is a treaty ally that…
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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- Analysis of UK Investments in China for 2023: Evaluating Deals, Values, M&A, and Investments
- Ratings agency cuts China’s credit outlook
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