May 30, 2017

China (中国) Today

Events Review (22.05–28.05.2017)

 

І. Major-Profile Events and Trends in the Development of the Situation around the PRC

China's strategic initiative “The Belt and Road” comes to the same level as the global cooperation of the leading countries of the world in the G20 (“Big Twenty”) format. This was confirmed during the 1st meeting within the framework of the mechanism of the Sino-German dialogue on humanitarian exchanges on 24 May 2017 in Beijing with the participation of the Minister of Foreign Affairs of China, Wang Yi, and the head of the Foreign Ministry of the Federal Republic of Germany, S. Gabriel.

On May 24, 2017, Chinese Foreign Minister Wang Yi met with Foreign Minister of Germany S. Gabriel
On May 24, 2017, Chinese Foreign Minister Wang Yi met with Foreign Minister of Germany S. Gabriel

According to the parties, G20 can be considered the most important platform for regulating the global economy. In turn, the “Belt and Road” was called the most ambitious and influential initiative in the sphere of current international relations. According to the Foreign Ministers of China and the FRG, the G20 and the “Belt and Road” have much in common in form and content (in terms of ideas and goals).

Thus, the “Belt and Road” stimulates countries to actively combine development strategies and rapprochement of political courses, which is closely linked with the G20's trying to achieve global coordination of macroeconomic policies. Besides, the “Belt and Road” suggests deepening the integration of the infrastructure of the participating countries, removing trade barriers and accelerating the turnover of finance, which coincides with the installation of the G20 for a steady growth of the world economy.

Taking into consideration these circumstances, the participants expressed confidence in the possibility of further deepening of interaction between G20 and the “Belt and Road”, which complement and stimulate each other in “building a human society with a single destiny”.

 

II. China's Strategic Initiative “The Belt and Road” in the Context of Chinese and Regional Interests

As part of practical implementation of these plans, May 26, 2017, on the initiative of the China Railway Construction Corporation, a Coordinating Committee on freight traffic on the China-Europe route was established in Beijing. The new body's task is to coordinate measures for organization of this route, including the development of train schedules, exchange of information on cargo and carriages, the state of the railway network, etc.

The first freight train left the Chinese city of Shenzhen for Belarus on May 22

Since the opening of the direct rail service between China and Europe in 2011, more than 4 thousand trains have been sent on route, including about a thousand — since the beginning of this year. In particular, on 22 May 2017, the first freight train headed from China to Belarus. The length of the railway connecting the Chinese port of Yantian (Shenzhen region) with the city of Minsk is 9.9 thousand kilometers; it takes two weeks to cover the distance.

 

III. Other Trends and Developments Influencing the Situation in and around China

3.1. Politics

One of the main priorities of China's foreign policy is the development of partnership relations with the EU countries. Thus, for May 31 — June 2 this year is scheduled a visit of Prime Minister of China Li Keqiang to Europe. During his meetings with the leadership of the European Union, the Federal Republic of Germany and Belgium, he is going to discuss ways to ensure peace and stability around the world and to increase the openness of international trade and investments. Besides, Li Keqiang will take part in a number of events, including the 19th meeting of the leaders of the PRC-EU with the participation of the European Council's President D. Tusk and the head of the European Commission J. Juncker; China-EU Business Summit; China-EU Innovation Cooperation Dialogue, as well as the Sino-German Innovation Forum with Federal Chancellor of Germany A. Merkel.

 

At the same time, the dialogue between China and Russia continues. May 25–26, 2017, Minister of Foreign Affairs of China Wang Yi paid an official visit to Moscow. During his meeting with Russian Foreign Minister S. Lavrov, the prospects for deepening cooperation between the two countries were discussed, in particular, plans for the visit of Chinese President Xi Jinping to the Russian Federation (expected in early June of this year). The Foreign Ministers also discussed a wide range of key regional and global problems, including the situation around Syria and the Korean Peninsula. At this, the parties condemned the development of nuclear weapons by North Korea and the latter's testing ballistic missiles, as well as the USA's actions to deploy a missile defense system in South Korea. The positions of Russia and the PRC on these issues were also confirmed during Wang Yi's meeting with Russian President V. Putin.

Meetings of the Chinese Foreign Minister Wang Yi with Russian Foreign Minister S. Lavrov and Russian President V. Putin

3.2. Economy

Moody's Agency downgraded China's ratings

Moody's Agency downgraded China's ratings

The conditions for China's foreign economic activity which are getting more complicated (first of all due to the USA's intensifying measures to protect its markets), as well as a number of domestic problems, downgraded the rating of the Chinese economy. Thus, on 24 May 2017, the Moody's rating agency downgraded China's long-term local currency and foreign currency issuer ratings to A1 from Aa3 and changed the outlook to stable from negative which demonstrates the confidence of world analysts of the China’s ability to overcome the difficulties encountered.

In particular, in order to improve the investment climate, China is planning to abolish restrictions on foreign capital in a number of sectors of the Chinese economy, including in the automotive industry. This will create more favorable conditions for mutual access to the markets of China and its trading partners. At the same time, despite China's struggle to increase the openness of international markets, the Chinese leadership is taking measures to protect national producers. Thus, the Chinese government has introduced a three-year duty on the import of sugar.

 

3.3. Security and Law Enforcement Agencies

The main factor in the destabilization of the situation in the APR remains the problems related to the North Korean nuclear missile program. Thus, according to the leader of the DPRK Kim Jong-un, despite the G-7 leaders' threats to strengthen sanctions against North Korea, it will continue to create new powerful weapons. He also expressed the DPRK's readiness to use such weapons against the USA and its allies in the event of an attack on North Korea. In confirmation of this, on 28 May 2017, the DPRK carried out another (third in the last two weeks) launch of a medium-range ballistic missile that flew 450 kilometers and fell in the exclusive economic zone of Japan.

On May 28, the DPRK carried out another launch of a medium-range ballistic missile

Additional conflicting potential for the development of the situation in the Asia-Pacific region is Russia's provocative actions against the United States in the form of systematic flights of long-range (strategic) bomber aircraft of the Russian VKS (Aerospace Forces) towards Alaska. Such actions are accompanied by aggressive anti-American rhetoric in the context of demonstrating the growing might of the Strategic Nuclear Forces of the Russian Federation.

In response, the USA demonstrates its military force in the APR. At this, emphasis is placed on both the possibility of striking the enemy and the USA's capability of repulsing a possible nuclear missile strike. Thus, in addition to the two US Navy Carrier Strike Groups “Ronald Reagan” and “Carl Vinson”, which are already near the Korean Peninsula, a third group (CSG-11) is heading into the region, led by the USS “Nimitz” (the most powerful American aircraft carrier). In fact, such a concentration of aircraft carrier strike groups of the US Navy in the area of potential conflict is observed for the first time since the Korean and Vietnamese wars.

The US Navy is sending to the region the third Carrier Strike Group (CSG-11) headed by the USS “Nimitz” (CVN-68)
The US Navy is sending to the region the third Carrier Strike Group (CSG-11) headed by the USS “Nimitz” (CVN-68)

Besides, on 30 May 2017, the USA conducted a practical test of the THAAD missile defense system in South Korea to intercept intercontinental ballistic missiles. The tests simulated the launch of a ballistic missile from the territory of the DPRK towards the United States (since 1999, the United States has conducted 17 tests of interceptor missiles, the latest one — in June 2014).

North Korea's new missile tests caused Japan's very negative reaction. According to Prime Minister S. Abe, Japan will make every effort to convince the UN Security Council of the need to strengthen sanctions against North Korea. At the same time, Japan's government will introduce an additional package of its own sanctions against the DPRK.

The DPRK's missile launches were also condemned by China and Russia. At the same time, the PRC negatively perceives the USA's strengthening its military presence in the Asia-Pacific region. Thus, the Ministry of Defense of the PRC called on the USA “to stop provocative activities in the area of the South China Sea, which threatens China's sovereignty and security”. In this regard, a protest was expressed about the USS “Dewey” missile destroyer approaching the Nansha (Spratly) Islands, which China considers its territory. Besides, the Ministry of Defense of China is dissatisfied with the activation of US air reconnaissance in the region. Demonstrating its determination, on 24 May 2017, China intercepted the US Navy P-3 Orion surveillance plane in the sky over the South China Sea. Two Chinese J-10 fighter jets flew within 100 yards of it.

The Ministry of Defense of the PRC called on the USA “to stop provocative activities in the area of the South China Sea”

Also, the Ministry of Foreign Affairs of China expressed its dissatisfaction with the final statement of the G7 summit on the situation in the South China and East China Seas. First of all, it concerns the appeal to all countries of the region “to refrain from any actions that could increase tensions in the APR, and also to solve maritime territorial disputes through dialogue and law”. According to the Ministry of Foreign Affairs of the People's Republic of China, Beijing has always advocated and supports the settlement of such problems directly with other countries in the region through peaceful negotiations. With this in mind, the PRC's foreign policy department has emphasized the inadmissibility of “irresponsible statements” from the leading countries of the world.

 

In general, all these events indicate a significant increase in the threat of armed conflict in the Asia-Pacific region with unpredictable consequences, including the possibility of using nuclear weapons. Thus, the aggravation of the situation around North Korea adds to the confrontation between Russia and the West within the framework of the emergence of an “axis of instability” along the Europe-Asia-Pacific route. In fact, today's situation in the world is more and more like the eve of World War II.

 

3.4. Science and Technology

The development of the scientific and technical potential of the PRC confidently takes it to the number of advanced in the exploration of outer space. According to the plans of the Chinese government, this year will be launched 6 to 8 navigation satellites “BeiDou”, and in the period from 2018 to 2020 — another twenty such spacecraft. At the moment, in space orbit, there are already fifteen satellites of this type, of which five are included in the network. The system's operating at full capacity will increase the accuracy of position finding of ground objects to a centimeter level.

Besides, as part of the space research program, in the province of Guizhou, China has started creating a Center for processing data from the world's largest radio telescope FAST (Five hundred meter Aperture Spherical Telescope). In terms of the size of the aperture (500 m) and sensitivity of the receiving device, the radio telescope has no analogues, and in the next 10–20 years will remain one of the leading astronomical instruments.

The world's largest radio telescope FAST in Guizhou Province (China)

IV. Plans and Prospects for Cooperation between China and Ukraine

The PRC's leadership is paying greater attention to cooperation with Ukraine. According to the Chinese Ambassador to Ukraine Du Wei, Beijing hopes that Kyiv will not hesitate to determine its position on the issue of the introduction of a mutual visa-free regime and a free trade zone and China is ready to begin negotiations at any moment.

In support of this, China is consistently opening up its market for Ukraine. In particular, last week an agreement was reached between China and Ukraine on the export of Ukrainian beef to China. The issue of expanding the possibility of exporting to the PRC of other Ukrainian goods is being considered.

Signing of the Protocol on inspection, quarantine, veterinary and sanitary requirements for the export of frozen beef from Ukraine to China

At the same time, China-Ukraine relations in the sphere of culture are deepening. In particular, last week the delegation of the Chinese Tibetan exchange visited Ukraine. Within the framework of the visit, a round table was organized on the topic “Modern Trends in the Development of Buddhism in the World and in Ukraine”. Besides, members of the delegation spoke before students of the Kyiv Taras Shevchenko National University on Tibetan history, culture, medicine, philosophy and art.

A round table on the topic “Modern Trends in the Development of Buddhism
in the World and in Ukraine”

The assessments by the Chinese media concerning the 62nd International Song Contest “Eurovision-2017” (May 7-12, 2017) are also indicative and are completely different from Russian ones. Thus, according to the materials of the Chinese agency Xinhua, 92 % of foreign guests would like to once again visit Ukraine.