January 17, 2018

China (中国) Today

Events Review (08.01–14.01.2018)


I. Main Trends and Developments in the Development of the Situation in and around China in 2018

The achievements of the People's Republic of China in foreign and domestic affairs contributes to the formation of a positive perception of the country in the world. According to the “2016–2017 China National Image Global Survey” prepared by the Center for International Communications, a steady tendency of improving the PRC's international image has been observed in recent years. Thus, according to polls conducted in 22 countries of the world among people aged 18 to 65, 70 % respondents approved of China's activity.

At this, among the main components contributing to the formation of such a trend, were pointed out the leading role of the People's Republic of China in the global development of the world, economic, scientific and technical development of the country, as well as its ancient cultural traditions. In particular, the most prominent achievements that are associated with the country are construction of new high-speed railway lines, manned space exploration and creation of supercomputers.

Of great importance is also the popularity of Chinese companies' brands as part of the country's image. The most famous abroad are Lenovo, Huawei, Alibaba, Air China and Bank of China. The products and services of these companies are considered to be important factors through which people from different countries know and understand China, as well as form their attitude to it.

At the same time, 63 % of foreign respondents admitted poor quality of Chinese products. This figure has actually not changed since 2015. At the same time, in some countries, there are increasing doubts and concerns about the growing “Chinese threat”, including expansion from the PRC. Accordingly, Chinese experts conclude that it is necessary to bring Chinese goods to the level of the world's leading requirements, as well as to intensify the work on explaining China's international policy.

2016-2017 China National Image Global Survey (.pdf)
2016-2017 China National Image Global Survey (.pdf)

Against this background, an important event in the domestic political life of the People's Republic of China was the meeting of the Politburo of the Central Committee of the Communist Party of China on January 12, 2018, during which the issue of amendments to the Constitution of the country was discussed. The meeting participants pointed out the decisive role played by the current Chinese Constitution in the historical process of the policy of reform and openness and socialist modernization, as well as in the practice of state governance.

At the same time, members of the Supreme Body of the CPC acknowledged the need to bring the Chinese Main Law in line with the new strategic challenges the country faces, and which include the construction of developed socialism with Chinese characteristics and a moderately prosperous society. In turn, this requires adjusting the basic articles of the Constitution based on the experience of party and economic work, as well as the results of relevant theoretical studies.

Specific decisions on the issues raised will be taken during the Second Plenary Session of the 19th CPC Central Committee on 18–19 January, 2018 in Beijing.


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

Ambassador of the European Union to China Hans-Dietmar Schweisgut
Ambassador of the European Union to China
Hans-Dietmar Schweisgut

The positive results of the work of “The Belt and Road” are drawing to it the leading world countries and international organizations' greater attention. According to the EU Ambassador to the People's Republic of China Hans-Dietmar Schweisgut, the European Union is developing its own program interconnected with the Chinese initiative “The Belt and Road”. At the same time, H.-D. Schweisgut expressed hope for closer integration of the efforts of the EU and China in promoting the development and prosperity of the Eurasian continent.

The basis for this was laid in 2015 as part of reaching an agreement between the leaders of the EU and the PRC on cooperation in the sphere of infrastructure development. In May 2017, during the “Belt and Road” Forum for International Cooperation, the EU and China adopted guidelines for further cooperation, which include openness, transparency and mutual benefit.


There is also an active involvement in the Chinese initiative of post-Soviet countries. For example, on January 1, 2018, the Free Trade Agreement between the People's Republic of China and Georgia entered into force, which created the prerequisites for bringing the parties' cooperation to a qualitatively new level. In 2017, the total volume of trade between them had already increased by 24 % to 200 million US dollars.

Along with Georgia, Belarus actively participates in joint projects with the People's Republic of China. Earlier this year, Beijing Normal University and the National Academy of Sciences of Belarus have set up a joint “The Belt and Road” studies center. The main task of the center is to promote intensification of China-Belarus contacts in the trade, economic and investment spheres.


All this exacerbates concerns of the Russian Federation, which is gradually shifting from the euphoric perception of China as a “rescuer” from Western sanctions, to real understanding of the threats from it. Thus, according to Russian experts, within the framework of building “The Belt and Road”, the PRC forms its own sphere of influence, which undermines the Russian Federation's positions. In the given context, illustrative are current publications in Russian media of a critical nature with coverage of problems in the development of cooperation between China and its partners in “The Belt and Road”.

Thus, they tell about the negative reaction of a number of countries “from Hungary to Tanzania” to the PRC's proposals, which allegedly have a bonded character and threaten their security. In particular, to confirm this, they mention Pakistan's refusal from a joint project with China regarding the construction of the Diamer-Bhasha Dam, Nepal's — from the construction of a hydro-technical facility worth 2.5 billion US dollars, and Thailand's — from the construction of a high-speed railway.

Besides, Russia's media are trying to persuade the audience that other leading powers of the world, including the United States, India and the European Union should support Russia's concerns about “The Belt and Road”.


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

3.1. Politics. Development of China's International Cooperation

Chinese President Xi Jinping met with French President Emmanuel Macron in Beijing, January 8, 2018
Chinese President Xi Jinping met with French President Emmanuel Macron in Beijing, January 8, 2018

Chinese President Xi Jinping met with French President Emmanuel Macron in Beijing, January 8, 2018, and that was the last week's key event in the development of China's international cooperation. The parties discussed prospects for development of cooperation between the two countries in the context of building the world with a common destiny for all humanity. At this, they expressed readiness of Beijing and Paris to join forces in achieving this goal.

At the same time, the leaders of the PRC and France pointed out their countries' being interested in further strengthening bilateral ties on the basis of mutual trust and benefits in a wide range of spheres. First of all, nuclear power engineering and development of new energy sources, aviation and cosmonautics, artificial intelligence, education and culture were named among them. Besides, special attention was paid to discussing the plans of France's participation in “The Belt and Road” projects, as well as helping China's wider involving in the markets in the European Union.

During E. Macron's visit to China, a series of business meetings was held between representatives of business circles of the two countries. From the French side, there were executives from more than 50 large companies, including Airbus, AccorHotels, LV, Areva and Safran. As a result of the negotiations, several dozens of contracts and agreements in various spheres were concluded. The largest of these was the enhanced cooperation agreement between the Chinese General Nuclear Power Corporation and the French Alternative Energies and Atomic Energy Commission. Under the agreements reached, it is planned to concentrate efforts on improving all parts of the technological cycle of nuclear energy production.


Chinese President Xi Jinping meets with parliamentary leaders of Nordic and Baltic countries in Beijing, January 10, 2018
Chinese President Xi Jinping meets with parliamentary leaders of Nordic and Baltic countries in Beijing, January 10, 2018

As part of the development of cooperation with European partners, on January 10, President of the People's Republic of China Xi Jinping met with speakers of the parliaments of the countries of Northern Europe and the Baltics. According to the Chinese leader, Northern Europe and the Baltics are important for China as the final point of the Chinese project “The Belt and Road”. At this, the development of relations with them contributes to the formation of China's strategic partnership with the whole of Europe. Taking into account the above-mentioned circumstances, Xi Jinping expressed the need for further deepening of such relations on the principles of mutual respect, tolerance and common interests of the parties. In turn, representatives of the Nordic countries and the Baltics showed serious intentions to strengthen the dialogue with the PRC, expand cooperation and promote Sino-European relations.


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

A significant prerequisite for the positive dynamics of China's economic growth remains state support for the spheres of production and services. At the beginning of January this year, the State Council of China together with the Ministries of Finance and Commerce of the country, as well as the Chinese investment company Merchants Capital, created an investment fund of 4.6 billion US dollars to promote the development of the trade in services. Due to this, it is expected to resolve the problems with the shortage of services in the domestic market, including in the sectors of transport, tourism, telecommunications, construction, advertising, computing and reporting.


China's total volume of foreign trade up to 14.2 % in 2017
China's total volume of foreign trade up to 14.2 % in 2017

Besides, further steps are being taken to improve the investment climate in the country. Thus, the Government of the People's Republic of China has made a decision on simplifying the conditions for investors in free trade areas. In particular, investors with 100 % foreign capital have the right to invest into business projects related to the development of the Internet, design and repair of aircrafts with take-off weight of up to 6 tons and helicopters — up to 3 tons, as well as into creation of entertaining enterprises. To date, 11 free trade areas have already been opened in China, which are fields for testing innovations in trade, economic and investment spheres.


The development of the Chinese economy, as well as the intensification of the country's international relations, also contribute to the growth of its foreign trade. According to the General Administration of Customs of China, in 2017, the total volume of foreign trade in the PRC amounted to 4.28 trillion US dollars, which is by 14.2 % more than in 2016. Thus, in China, the decline in this indicator, which lasted for the past two years, has stopped. At this, exports from China have increased by 10.8 % and imports — by 18.7 %. The main articles of Chinese exports were electromechanical and work-consuming products, while imports were raw materials (first of all crude oil and ore) and food.


3.3. Security and Law Enforcement Agencies

Chronology of North Korea's missile launches
Chronology of North Korea's missile launches

Situation around the Korean Peninsula. In view of Pyohgyang's continuing its missile and nuclear program, the leading countries of the world and international organizations are increasing pressure on the DPRK. Last week, within the framework of UN Security Council's decisions of December 22, 2017, the European Union introduced new sanctions against North Korea. According to the EU Council, all in all, sanctions lists include 79 individuals and 54 organizations.


Earlier, on December 26 last year, additional sanctions against the DPRK were imposed by the United States. At the same time, US Department of State is discussing plans to take additional measures to ensure control over the sea routes to North Korea. Due to this, they are going to block the DPRK's import and export of the goods — subject to UN sanctions. January 16, 2018, this issue will be discussed during their meeting in Canada by representatives of the foreign and defense ministries of the United States, Canada and other countries that participated in the United Nations' Mission in the Korean Peninsula during the 1950–1953 war (Australia, Belgium, Britain, Columbia, Ethiopia, France, Greece, Luxembourg, the Netherlands, New Zealand, the Philippines, South Africa, Thailand and Turkey). The talks will also be attended by South Korea, Japan, India and Sweden. Russia and the PRC have not been invited to the meeting.


The United States and their partners in the Asia-Pacific region continue deepening military and military-technical cooperation. January 9, 2018, the US State Department approved a possible sale to Japan of Aegis SM-3 Block IIA missiles worth 133 million US dollars. This type of missiles can be launched from both land and ship launchers.


For its part, China is also intensifying pressure on the DPRK. January 5, 2018, the Ministry of Commerce of the People's Republic of China imposed a ban on the export of steel, other metals and industrial equipment to North Korea. In addition, they limited the supplies of oil and petroleum products. At the same time, a ban was imposed on imports of grain, certain types of minerals, as well as electronic and other products of the North Korean production into the PRC.

On the same day, the firmness of Beijing's position with regard to North Korea was confirmed by the Chinese Ministry of Foreign Affairs. According to its statement in response to certain media's arguments about the continuation of Chinese oil supplies to the DPRK, Beijing has always strictly and fully complied with the UN Security Council's resolutions and will not allow its citizens and companies to violate them.


Inter-Korean high-level government talks were held on January 9, 2018
Inter-Korean high-level government talks were held
on January 9, 2018

At the same time, the leading countries of the world and the Asia-Pacific region do not give up the attempts to establish a dialogue with North Korea.

In particular, the first over the last two years direct Inter-Korean high-level government talks were held on January 9, 2018. They discussed the issues of prevention of the possibility of a sudden conflict, as well as improvement of interstate relations. As a result of the negotiations, agreements were reached to open a “hot line” between the two countries and on North Korean athletes' participation in the Winter Olympics, which are planned in South Korea.

According to Minister of Unification (Republic of Korea) Cho Myoung-Gyon, a positive solution to these issues could be an impetus for improving relations between the two countries.



China plans to build second offshore base of the PLA Navy near a Pakistani port of Gwadar
China plans to build second offshore base
of the PLA Navy near a Pakistani port of Gwadar

China's Military Activities. Within the framework of realizing its strategic interests, the PRC continues to increase its military presence in key regions of the world. Thus, China plans to build second offshore base of the PLA Navy near a Pakistani port of Gwadar, which is strategically located on one of the most important trade routes in the world through the Arabian Sea and the Strait of Hormuz. In 2017, the PLA navy base was opened in Djibouti on the coast of the Gulf of Aden.

Besides, the implementation of the program for strengthening the combat capabilities of the PLA Navy continues. At the beginning of January 2018, China began construction of a new “Type 002” aircraft carrier, which will become the most powerful warship in the history of the country. According to its characteristics, the new Chinese aircraft carrier will be close to American warships of the same class.


3.4. Science and Technology

China launched a Long March-2D rocket with two Gaojing-1 Earth observation satellites, January 9, 2018
China launched a Long March-2D rocket
with two Gaojing-1 Earth observation satellites, January 9, 2018

According to the plans of the Chinese National Space Administration, on January 9, China launched into the orbit a Long March-2D rocket with two Gaojing-1 Earth observation satellites.

The satellites will provide imagery with 0.5 m panchromatic resolution. Upon completion of the test, the devices will be transferred to customers commercially. The system was developed by the China Research Institute for Space Technology.


At the same time, in early January, 2018, the National Development and Reform Commission of the People's Republic of China approved a project for the construction of a 110-meter wide-angle radio telescope in the Xinjiang Uygur Autonomous Region (Northwest China). It will become the world's largest device of this type. The radio telescope will allow to observe three quarters of the celestial sphere with high sensitivity, including the center of our Galaxy. The project aims to create a world-class platform for research in such cutting-edge areas as gravity waves, black holes and dark matter. The implementation of the project will contribute to the development of Chinese astronomy and deepening international cooperation in this area.


A driverless monorail system “Yungui” was launched in city of Yinchuan on January 10, 2018
A driverless monorail system “Yungui” was launched in city of Yinchuan on January 10, 2018

Measures to develop the country's transport infrastructure based on high technologies continue. In central China, the construction of another medium-speed magnetic traction line was started. The speed of the train will be 200 km/h. In addition, a driverless monorail system “Yungui” was launched in Yinchuan (Ningxia Hui Autonomous Region) on January 10, 2018. The driverless “Yungui” system allows maintaining a safe distance between trains, detecting malfunctions and tracking passenger traffic. At the initial stage, the speed of the trains will be 80 km/h.


IV. Plans and Prospects for Cooperation between China and Ukraine

The PRC's government continues to pursue a consistent policy of opening its market to Ukraine. In particular, on January 8, 2018, the General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China (AQSIQ) issued an updated list of exporters of sunflower meal from Ukraine to the People's Republic of China. Today, with the assistance of the Embassy of Ukraine to the PRC and the Embassy of China in Ukraine, measures are continuing to expand the range of Ukrainian goods that can be supplied to the Chinese market.


The development of cooperation between the PRC and Ukraine is accompanied by steps taken by the parties to facilitate opportunities for mutual visits of citizens. To this end, the Embassy of Ukraine to the People's Republic of China has opened a number of visa centers on the territory of the PRC, including in the cities of Beijing, Shanghai and Guangzhou. The main task of the centers is to improve the provision of services in the process of obtaining visas.