August 1, 2017

China (中国) Today

Events Review (24.07–30.07.2017)


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

In July 2017, China held the temporary presidency of the UN Security Council. Within that month the PRC raised a number of important issues, including the reform of the UN Security Council, improvement of security in Africa, and resolving the conflicts in the Middle East.

Thus, the Permanent Representative of the People's Republic of China to the UN, Ambassador Liu Jieyi, proposed to intensify the process of discussing the issue of reforming the UN Security Council during the next session of the UN General Assembly. He reiterated China's position on the need to increase the capacity of the UN Security Council in countering global challenges and threats. The PRC also supports the idea of expanding the membership of the UN Security Council, in particular by including the FRG and other leading countries of the world, but without giving them the right of veto. Besides, the PRC is in favor of enhancement of the role of developing countries in the UN.

At the PRC's initiative, an open debate was held with agenda “Enhancing African capacities in the areas of peace and security”. During the discussion, Liu Jieyi pointed out the expediency of the world community's more active participation in solving Africa's problems, including by deepening the UN's cooperation with the African Union (AU). At the same time, according to the Chinese diplomat, African problems should be resolved by “African methods”, that is, taking into account local specifics. In this context, Liu Jieyi stressed the positive experience of China's cooperation with the AU, where about ten joint programs are being implemented in the spheres of economic development, society, peace and security.

In the context of the settlement of the conflicts in the Middle East, an open debate was held under the chairmanship of Liu Jieyi on the Palestinian-Israeli problem. The representative of the PRC outlined China's proposals on this issue, which provide for the establishment of relations between Israel and Palestine on the basis of the principle “two states for two peoples”, observance of the concept of integrated and sustainable security, deepening coordination of the world community's efforts to advance the process of political settlement of the conflict, and to stimulate peace through development.

A separate direction of the Chinese presidency in the UN Security Council was intensification of the struggle against international terrorism. July 20, 2017, the UN Security Council adopted a resolution on confirmation and extending the sanctions against ISIS and Al-Qaeda. A number of individuals and organizations associated with terrorists have been added to the sanction list. According to Liu Jieyi, China fully supports the activities of the Security Council ISIL (Da’esh) and Al-Qaeda Sanctions Committee which performs important functions to limit the financing of terrorists.

The provision of the presidency in the UN Security Council was fully used by China to promote the ideas of the globalization of the world economy and the implementation of the Chinese initiative “Belt and the Road.” These issues were constantly raised by the representative of the PRC both at meetings of the UN Security Council and in his statements on various occasions.


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

An important result of the activities of the “Belt and Road” initiative is an increase in the volume of the trade between the member countries of the initiative. For example, over the first half of this year, this indicator grew by almost 30 %. At this, the share of the countries of “The Belt and Road” in the PRC's foreign trade reached 28 %.

One of the main factors that allowed to reach such results, was the development of transport communications between China and Europe through Central Asia. For example, several new transport routes from China to Europe have been opened recently, including from the cities of Xiamen (Fujian Province, Southeast China), Ganzhou (Jiangxi Province, East China) and Urumqi (administrative center of Xinjiang Uyghur Autonomous Region, North-Western China).

Besides, China's internal transport infrastructure is being actively modernized. In July 2017, the high-speed highway Beijing-Urumqi was put into operation. Due to this, the new road between these cities is by 1,3 thousand km shorter than the old one. Interestingly, the Beijing-Urumqi highway passes through the Gobi Desert and has no analogues in the world.


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

3.1. Politics. Development of China's International Cooperation

A key political event in the PRC was a high-level seminar on July 26–27 this year, dedicated to the preparations for the 19th National Congress of the Chinese Communist Party (CPC). During the seminar, the President of the PRC, General Secretary of the CPC Central Committee Xi Jinping, set a strategic task for the country's leadership to continue work on building socialism with Chinese specifics, and creating a middle class as the foundation of the country's society. The solution of this issue is planned in five main directions, namely: economic, political, cultural, social and eco-cultural construction, and also on the basis of four main principles, including: creation of a medium-prosperous society, comprehensive deepening of reforms, full enforcement of the law in State administration and strict party control.

According to Xi Jinping, the 19th National Congress of the CPC will be of fundamental importance from the point of view of holding it at the stage of mass increase of the middle class stratum in the country (should become a leading stratum in China by 2020). After this, the CPC will direct the Party and society's efforts to implement the strategic goal of transforming China into a rich, powerful, democratic, civilized and modernized socialist state.

Besides, in this context, Xi Jinping set a number of separate tasks to intensify the fight against corruption, poverty and environmental pollution.


At the same time, China continues to actively develop international cooperation both at bilateral and multilateral levels. July 25, 2017, in Washington, with the participation of the PRC Ambassador to the USA Cui Tiankai, there was the “Prospects and Challenges for U.S.-China Relations” Conference.

During the event, Cui Tiankai pointed out the existence of deep common interests between the PRC and the USA, which far outweigh the differences between them. In this regard, the PRC Ambassador stressed the positive results of the first round of the China-US Diplomatic and Security Dialogue and the first round of the China-US Comprehensive Economic Dialogue in June–July this year, which opened up new prospects for the development of cooperation between the two countries.

At the same time, Cui Tiankai pointed out the need to pay more attention to the difficulties and challenges in the development of relations between China and the United States in order “to fend off any risk that could derail” them. First of all, he named the military and military-technical cooperation between the United States and Taiwan, which contradicts Washington's support for the “One China” principle. Besides, Cui Tiankai criticized certain aspects of the USA's policy in the Asia-Pacific region, namely, measures to demonstrate strength before the DPRK and building up the US military presence in the APR. In this regard, the PRC Ambassador expressed Beijing's special concern with the USA's actions to deploy the THAAD missile defense system in South Korea.


In turn, on 24–26 July 2017, a series of events were held in the PRC on the preparation of the 9th meeting of the leaders of the BRICS countries (scheduled for September in the Chinese city of Xiamen), including a meeting of representatives of the ministries of economy, industry, trade and communications, security and tax agencies, as well as trade unions of Brazil, Russia, India, China and South Africa.

They discussed ways to deepen cooperation within the BRICS in various spheres, including the prospects for creating a “large integrated market” of the member countries of the Organization. The main attention of the participants was paid to the development of “road maps” for the parties' cooperation in the spheres of electronic commerce, protection of intellectual property, and simplification of mutual investment procedures.

In this regard, representatives of the People's Republic of China pointed out the steady growth in the volume of China's (the leading country of the BRICS group) trade with other members of the Organization. Thus, in the first half of 2017, the PRC's imports from other members of the BRICS increased by 33.6 % compared to the same period of last year and reached 70.16 billion US dollars. In particular, China's imports from Brazil amounted to 28.93 billion US dollars (+33.5 %), from Russia — 20.34 billion US dollars (+29.4 %), India — 8.23 billion US dollars (+42,5 %) and South Africa — 12.66 billion US dollars (+35.4 %).


During the same period, the 11th China-ASEAN Forum on Social Development and Poverty Reduction was held in the Cambodian city of Siem Reap, with the participation of representatives of governments, scientists, relevant profile specialists, media and international and non-governmental organizations. The participants of the meeting considered the concept of poverty reduction within the framework of the development of the APR and South-East Asia for the period until 2030.

During the forum, the representative of the State Council of the People's Republic of China, Hong Tianyun, called the problem of poverty a common challenge for the whole region, which requires joined efforts of China and the ASEAN countries to solve it. According to him, the political and economic reforms that have been carried out in China for almost 40 years have made it possible to rescue more than 700 million people from poverty, which is the largest indicator in the world. At the same time, by promoting economic development of other countries, the PRC also makes a significant contribution to overcoming poverty in the world.


3.2. Economy. Some Aspects of the Economic Situation in China

According to the Chinese Academy of Social Sciences (CASS)'s estimates, confirmed by the State Information Center of the country, China's GDP growth in the third and fourth quarters of this year will be 6.8 % and 6.7 % respectively. Given this, as well as the indicators of the first half of the year, the growth of Chinese GDP by the results of 2017 is expected at the level of 6.8 %. This result exceeds the planned level, which was determined at 6.5 %.

Within the framework of this trend, the growth is getting stabilized and the efficiency of Chinese industry is improving. In the first half of 2017, the volume of production of large Chinese enterprises grew by 6.9 % compared to the same period in 2016, which was the highest semi-annual figure for the last three years. According to Chinese experts, this indicator will continue to grow in the second half of this year.

The positive dynamics of the development of the PRC's economy is also confirmed by the leading international institutions in the financial and economic sphere. Thus, the International Monetary Fund has increased the forecast for China's economic growth to 6.7 % in 2017 and 6.4 % in 2018. In view of this, the process of restoring the growth of the world economy is expected to continue — by 3.5 % this year and by 3.6 % next year.


3.3. Security and Law Enforcement Agencies

The leadership of the PRC attaches priority importance to strengthening the country's Armed Forces as the main guarantor of the national security of the state. During the solemn events on the occasion of the 90th anniversary of creation of the People's Liberation Army (PLA) of China, which is celebrated on 1st August 2017, President Xi Jinping expressed the firm intention of the country's leadership to continue active efforts to reform the PLA.

According to the PRC President, the current military reform is “a comprehensive and revolutionary change”. It is aimed at overcoming the systemic contradictions that impede the development of the defense component of China and reduce its effectiveness due to the outdated organizational structure of the PLA and the inefficiency of the command and control system of the armed forces.

According to the decisions (November 2015) of the Central Military Commission of the CPC, considerable work has already been done in this regard, including optimizing the balance of the PLA's military branches and forces, as well as reforming military educational institutions and research institutions for the sake of training highly qualified officers and improving the quality of developing new models of weapons and military equipment.

In addition, programs aimed at increasing the combat readiness of troops and enhancing the effectiveness of patrolling in the air and at sea have been developed and are being implemented, military exercises are actively conducted, including in remote areas. Important steps have been taken in the sphere of military-civil integration and conversion. A Central Commission for Integrated Military and Civilian Development was established. Special attention of the PRC's leadership was paid to the improvement of the military law system with Chinese specifics. Over the past five years, China has adopted 3 military laws, 53 rules and about 800 military regulations.

An important direction of the PRC government's efforts was developing and strengthening relations with foreign partners. At the strategic level, the whole system of military diplomacy was transformed and modernized on the basis of the concept of creating a strong army. Thus, progress was made in developing military relations with other states in the interests of ensuring world and regional stability, as well as strengthening China's international positions.

The Chinese armed forces actively participated in peacekeeping operations and missions, combating piracy, providing humanitarian assistance to the population of the affected countries and regions, liquidating the consequences of natural disasters, etc.

According to the PRC government's assessment, in general, to date, the PLA has achieved the capability of not just guaranteeing China's national (including military) security, but also of ensuring the realization of its interests in the world.

As part of the festive events at the Zhurihe military base in the Inner Mongolia Autonomous Region on 30 July, for the first time was held a military parade, dedicated to the PLA's 90th anniversary. Nine combat groups of the Chinese People's Liberation Army participated in the parade, including a land operations group, an information operations group, a special operations group, an air and missile defense group, a naval operations group, an air operations group, a comprehensive support group, a counter-terrorism and stability maintenance group, as well as a strategic strike group (total of about 12,000 servicemen, 600 pieces of military equipment and up to 100 aircrafts).

During the parade, were demonstrated DongFeng-26 intercontinental ballistic missiles, DongFeng-21D anti-ship ballistic missiles, DongFeng-16G missiles for precision strikes, as well as the latest Chengdu J-20 fighters and other modern military equipment of China's own make.

Against this background, the main factor of instability in the Asia-Pacific region remains North Korea's actions to develop and test nuclear missiles. July 28, 2017, the DPRK carried out another launch of the intercontinental ballistic missile “Hwasong-14”, which flew 998 km in 47 minutes and fell in Japan's exclusive marine zone.

The launch of the missile was accompanied by the North Korean leadership's new threats against the United States. According to the leader of North Korea Kim Jong-un, the missile tests were fundamentally important and confirmed the DPRK's ability to strike at any country in the world, including the United States of America.

In fact, this possibility was recognized by the US Department of Defense, which confirmed the Hwasong-14's being able to reach Alaska State. Given this, the US strongly condemned North Korea's actions and called on the UN Security Council to increase sanctions against it. Besides, the USA accused the PRC and Russia of the de facto connivance of the DPRK within the framework of continuation of trade and economic cooperation with it.

At the same time, the USA and its allies in the APR have stepped up measures to demonstrate the strength in the region, as well as to increase their own security against the DPRK's possible attack. In particular, on 29 July 2017, the USA and South Korea conducted joint military exercises with the launch of tactical ballistic missiles ATACMS and “Hyunmoo-2”. Simultaneously, there were joint exercises of the US and Japanese air forces with the participation of two B-1B strategic bombers of the US Air Force and two F-16 fighters of the Japanese Air Force.

July 30, 2017, the US Missile Defense Agency and the units of the USA's 11th Air Defense Artillery Brigade (Fort Bliss, Texas) conducted a successful test of the THAAD defence system in Alaska. A target missile was launched by the US Air Force aircraft over the Pacific and was successfully intercepted by anti-missiles.


3.4. Science and Technology

One of the main directions of scientific and technical activities in China is to increase the efficiency of the country's transport infrastructure. Thus, the construction of the world's largest automatic container terminal is being completed in the deep-water port of Yangshan in Shanghai. The terminal will be able to handle up to 4 million sea containers per year, and having reached the designed capacity — up to 6.3 million. At this, the whole process of container handling is fully automated based on a single database and the integrated with it loading equipment. The managements of other leading ports of the world, in particular of Rotterdam, show considerable interest in the technologies of the Yangshan Port.

At the same time, China is actively developing automotive equipment on new clean energy sources. In particular, the Chinese companies Beijing Urban Construction Heavy Industry and Tangshan Caofeidian Development Investment Group have launched production of electric cargo vehicles. The carrying capacity of the new lorry is 1.5 tons, the range of mileage on one charge is 230 km. According to preliminary plans, it is planned to produce up to 5 thousand such lorries annually.

Hydrographical studies are continuing in the waters of the Pacific Ocean and the seas adjacent to China. Last week, they explored the bottom of the South China Sea with the simultaneous use of two unmanned underwater vehicles — remote controlled bathyscaphe “Faxian” and an autonomous robot “Tansuo”. The machines scanned the seabed and explored the area of one of the cold subaquatic springs.


IV. Plans and Prospects for Cooperation between China and Ukraine

As part of the development of Ukrainian-Chinese relations, the correct understanding of Chin's politics in the world and towards Ukraine is of great importance for our state. The main directions of such a policy were outlined by the Extraordinary and Plenipotentiary Ambassador of the People's Republic of China in Ukraine, Du Wei, in his interview with the media on 27 July 2017.

Thus, Ambassador Du Wei confirmed Beijing's attitude to Ukraine as a strategic partner of the PRC, and also stressed China's firm position to support the territorial integrity, sovereignty and independence of our country. At this, he pointed out the positiveness of Ukraine's participation in the Chinese initiative “The Belt and Road”.

According to Du Wei, Ukraine's main advantages in cooperation with the PRC within the framework of “The Belt and Road” initiative are Ukraine's geographical position and convenient transport network (air, land and sea), as well as the opportunities for mutual complementing the Ukrainian and Chinese economies (the Chinese side has a significant financial potential and experience in the implementation of scientific and technical results, while Ukraine has a great market potential and solid scientific and technical and human resources).

Taking into consideration all this, Du Wei stressed the Chinese investors' being interested in investing into the financial, agricultural and trade spheres of Ukraine, as well as into creation of joint ventures. At the same time, among the problems of Ukrainian-Chinese cooperation, he mentioned the unstable situation in Ukraine, as well as the low level of the use of loans of the PRC, opened for a total of 7 billion US dollars.