May 3, 2018

China (中国) Today

Events Review (23.04–29.04.2018)

 

I. Major Events and Trends in the Development of the Situation in and Around China

The leadership of the PRC is pursuing a consistent policy of strengthening the international position of the country and expanding its sphere of influence in the world. One of the tools of such a policy is to promote the development of the Shanghai Cooperation Organization (SCO) as a powerful regional organization with China's leading role in it. In this regard, of great importance is the preparation for the meeting of the SCO Heads of State Council in June 2018 (Qingdao, Shandong Province). As part of the preparatory events, on 23–24 April 2018, Beijing hosted a meeting of the Council of Ministers of Foreign Affairs and a meeting of Defence Ministers of the SCO.

The foreign ministers of the SCO took note of progress in the implementation of the decisions of the SCO Heads of State Council’s meeting that took place in Astana, Kazakhstan in June 2017, and the SCO Heads of Government Council’s meeting that took place in Sochi in November 2017. They pointed out that the SCO has established itself as a prominent intergovernmental organisation of a new kind and an authoritative international actor.

The SCO Council of Foreign Ministers meeting
The SCO Council of Foreign Ministers meeting

Besides, the participants of the meeting reviewed priorities in terms of furthering the development of the SCO in the wake of India's and Pakistan's accession to the organisation. They also discussed topical international and regional problems. First of all, among them were named the risks of instability, uncertainty, political tension, regional crises and conflicts, as well as destructive attempts to use unilateral restrictive measures for exerting political and economic pressure. In this context, the foreign ministers noted that the adoption of the Action Plan for 2018–2022 on the Implementation of the Treaty on Long-Term Neighbourliness, Friendship and Cooperation between the SCO Member States and the Programme of Cooperation among SCO Member States on Counter-Terrorist, Counter-Separatist and Counter-Extremist Measures for 2019–2021 will contribute to stepping up joint efforts in these spheres.

The ministers approved a report on the work of the SCO Secretariat in 2017 and a draft report on the SCO's performance in 2017, and also adopted decisions on a number of issues regarding the organisation's operations and the upcoming meeting of the SCO Heads of State Council in Qingdao.

During the meeting, the defence ministers of the SCO had a discussion, exchanging views on international and regional security matters, the further strengthening of defence and security cooperation. In this context, they stressed the importance implementing the SCO Defence Ministries' Cooperation Plan for 2018–2019, which provides for strengthening the confidence of the parties, a common response to new challenges and threats, and ensuring peace and stability in the region. According to the plan, the joint military counter-terrorist exercise “Peace Mission-2018” is to be held in August 2018 in the Russian Federation. In addition, the participants welcomed the accession of the defence ministries of India and Pakistan to the Cooperation Agreement among the SCO Defence Ministries and other documents on military cooperation.

The SCO Defence Ministers meeting
The SCO Defence Ministers meeting

On the sidelines of these events, representatives of the highest state leadership of the PRC had separate meetings with the ministers of foreign affairs and defense ministers of the SCO member states.

 

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

Participation in “The Belt and Road” projects is one of the most important spheres of transnational corporations' investment activity in China. According to a report by the University of International Business and Economics in Beijing, entitled “Transnational Corporations of the PRC and the Implementation of “The Belt and Road”, in recent years there has been a tendency to increase the investment of China's large companies in the countries of “The Belt and Road”. With this in mind, Chinese multinational corporations have already become a powerful driving force behind the development of “The Belt and Road” and its actual subject.

 

Given the strategic importance of “The Belt and Road” for the PRC, the country's leadership is making every effort to involve other countries and regions in it. Last week, the Consulate General of the People's Republic of China in the British city of Manchester hosted an open-day event for understanding the “Belt and Road” Initiative. The event was attended by about 100 people, including a representative of the Queen of Great Britain in Greater Manchester (the most developed region of the country) Lord Lieutenant W. Smith, Lord Mayor of Manchester E. Newman, as well as representatives of political, business and academic circles. The participants emphasized the positive character of the UK-China cooperation from which both parties benefit. Based on this, the participants of the event agreed on the necessity of expanding the cooperation of the parties also in the projects of “The Belt and Road”.

An open-day event for understanding the “Belt and Road” Initiative in the British city of Manchester
An open-day event for understanding the “Belt and Road” Initiative
in the British city of Manchester

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

3.1. Politics. Development of China's International Cooperation

A significant problem in relations between the PRC and the United States as the two leading countries of the world is the sharpening disagreements between the parties in the trade and economic sphere. According to the statement by the Ministry of Foreign Affairs of China of April 24, Beijing is ready for the USA's possible actions to set barriers for Chinese investments. The statement also confirmed China's being against any unilateral protectionist measures.

 

Besides, the parties' mutual accusations of violations of human rights increase. Thus, the Ministry of Foreign Affairs of the People's Republic of China criticized the US Department of State's Country Reports on Human Rights Practices for 2017. In particular, the American experts statements regarding such violations in China were called “attempts to interfere in the internal affairs of the country”. In response to this, China’s State Council Information Office published documents titled “Human Rights Record of the United States in 2017” and “Chronology of Human Rights Violations of the United States in 2017”.

Human Rights Record of the United States in 2017 Chronology of Human Rights Violations of the United States in 2017
Human Rights Record
of the United States in 2017
Chronology of Human Rights Violations
of the United States in 2017

In the above-mentioned situation, the PRC is intensifying cooperation with other leading countries of the world. April 27–28, 2018, Chinese President Xi Jinping met with Prime Minister of India Narendra Modi in the Chinese city of Wuhan (Hubei Province). The parties held a strategic dialogue on the geopolitical changes in the world and the development of Sino-Indian relations in the long-term perspective. The leaders of the two countries agreed that the PRC and India have deep mutual common interests, which far outweigh the differences between them. Thus, last year the volume of trade between the two countries amounted to 84.4 billion US dollars (+20.3 %), while the total volume of Chinese investment in the Indian economy reached more than 8 billion US dollars. Proceeding from this, an agreement was reached to deepen the cooperation of the parties in all spheres, which would contribute to strengthening security in the region and mutual economic development.

Chinese President Xi Jinping with Prime Minister of India Narendra Modi
Chinese President Xi Jinping with Prime Minister of India Narendra Modi

The process of establishing relations between China and Japan continues. The 14th meeting of the China-Japan Intergovernmental Consultation Mechanism on Cultural Exchange was held in Tokyo on April 23, 2018. The participants of the event discussed the situation in the above-mentioned sphere, as well as determined the ways of solving existing problems. It is planned to intensify humanitarian exchanges at different levels, to create a mechanism and platform for sharing information, as well as to deepen cooperation in the sectors of the cultural industry.

 

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

April 23, 2018, the meeting of the Politburo of the CPC Central Committee summed up the results of the country's economic development in the first quarter of this year. According to the conclusion of the party leadership of China, the country's economy has seen a good start to its high-quality development and stable growth. An indication of this was the increase in all major macroeconomic indicators of the country (including GDP by 6.8 %), its steady growth momentum at the level of the previous quarter. All this was the result of the success of economic reforms, improvement of coordination between the growth of the industrial and service sectors, as well as stronger domestic demand.

 

The development of the economy of China leads to an increase in the energy needs of the country, which necessitates the commissioning of new energy facilities. According to the plans of the National Energy Administration of China, mass construction of third generation nuclear power units is planned to begin in the near future. Nuclear energy is among the most important energy sources in the country, but its share is still less than 4 % in total electricity production.

 

Against the background of sharpening trade-economic disputes between China and the USA, there is a tendency to increase the volumes of mutual trade between China and Russia. According to the General Administration of Customs of the PRC, in the first quarter of 2018, the figure amounted to 23.06 billion US dollars (+28.2 %), and by the end of this year it may reach 100 billion US dollars.

However, representatives of NGOs from Transbaikalia and the Far East of the Russian Federation continue to express concern over the negative consequences of the mass intrusion of Chinese citizens into the region, who actually drive out the Russian population. In particular, last year about 36 thousand Russians left Transbaikalia alone.

 

3.3. Security and Law Enforcement Agencies

Situation around the Korean Peninsula. The main event in the development of the situation in the region was the first over past 11 years meeting of the leaders of the two Korean states. South Korean President Moon Jae-in and North Korea's leader Kim Jong-un on April 26, 2018 met in the demilitarized zone on the border between the two countries. They discussed issues of improvement of bilateral relations, and the ways to achieve peace and prosperity in the Peninsula. As a result of the talks, a joint declaration was signed on the continuation of the phased reduction of armaments, cessation of hostilities and compliance with non-aggression agreements and the parties' non-use of military forces against each other. Besides, the leaders of South Korea and the DPRK reached an agreement to take steps towards signing an agreement on the end of the Korean Peninsula war and its complete denuclearization.

North Korea's leader Kim Jong-un and South Korean President Moon Jae-in North Korea's leader Kim Jong-un and South Korean President Moon Jae-in
North Korea's leader Kim Jong-un and South Korean President Moon Jae-in

The dialogue between South Korea and the DPRK reaching a qualitatively new level triggered a positive reaction of the leaderships of the United Nations, the United States, the People's Republic of China and other leading countries of the world and international organizations. In particular, in its official statement, the White House expresses hope for possible progress in resolving problems around the Korean Peninsula. In addition, US President D. Trump has agreed to meet with Kim Jong-un. April 28, 2018, positions of the parties on security issues, which will be considered by the USA and the DPRK’s leaders, were discussed during a telephone conversation between US and South Korean Defense Ministers.

 

Major Events in the Region in the Military Sphere

PRC. April 12–26, 2018, the PLA Navy conducted a large-scale maritime campaign and a series of exercises aimed at improving combat efficiency of the Navy, as well as demonstration of military force in the region. A group of warships including “Liaoning” aircraft carrier, submarines and warships sailed through the western part of the Pacific Ocean, South China and East China Seas. They mastered passage through zones patrolled by submarines, deck aircraft operations in difficult meteorological conditions, repulsion and applying rocket and air strikes.

In April 2018, the PLA Navy conducted a large-scale maritime campaign and a series of exercises In April 2018, the PLA Navy conducted a large-scale maritime campaign and a series of exercises
In April 2018, the PLA Navy conducted a large-scale maritime campaign and a series of exercises

3.4. Science and Technology

April 24, 2018 was China's Space Day
April 24, 2018 was China's Space Day

April 24, 2018 was China's Space Day (National Day of Space Flights) which is significant in the context of the country's achievements in the implementation of a wide range of programs for the development of outer space. In particular, on this occasion, the PRC made public its plans for research on the back side of the Moon, which remains largely unexplored.

Thus, by the end of this year, it is planned to launch the “Chang’e-4” lunar probe which has to land at the South Pole-Aitken basin the back side of the Moon. The onboard instrumentation of the probe will include both Chinese equipment and devices from research centers in other countries, including the Federal Republic of Germany, the Netherlands, Saudi Arabia and Sweden. To ensure the landing of the probe and communication with it, in May 2018 “Queqiao” communication relay satellite will be launched. The next step in conducting research will be the launch in 2019 of a “Chang’e-5” lunar probe, which should take samples of lunar soil and deliver them to the Earth.

 

China’s planned space station “Tiangong”
China’s planned space station “Tiangong”

The construction of China's space station “Tiangong”, which is scheduled to be put into operation by 2022, is also ongoing. According to the management of the space industry of China, the station will have an advantage over the International Space Station in such parameters as information and energy technologies, engine technology and management efficiency. At this, it will completely surpass the Russian station “Mir”. The main unit of the “Tiangong” station includes one central compartment and two laboratories with a total mass of 66 tons. There will be three astronauts at the station at all times.

Given these circumstances, quite indicative are the USA and its partners' demands to exclude Russia from the international project of creating a lunar station due to the technical backwardness of the Russian space industry.

 

IV. The State and Prospects of Cooperation Between the PRC and Ukraine

In 2017, China was second to the EU among foreign trade partners of Ukraine
In 2017, China was second to the EU among foreign trade partners of Ukraine

The consistent development of cooperation between China and Ukraine makes the trade and economic relations of the parties reach a qualitatively new level. According to the report of the Ministry of Economic Development of Ukraine, in 2017, China was second to the EU among its foreign trade partners. Thus, the share of trade turnover with the People's Republic of China in the foreign trade of Ukraine amounted to 8.28 %. At this, bilateral trade amounted to 7.7 billion US dollars with a growth of 17.9 %. Exports of goods from Ukraine to China amounted to 2.4 billion US dollars (+17.9 %), and imports — to 5.6 billion US dollars (+20.5 %).

 

An important direction of cooperation between the PRC and Ukraine is also the participation of Chinese companies in modernizing the Ukrainian port infrastructure. Last week, a reception devoted to further deepening of the interaction of the parties in the above-mentioned sphere was held at the Consulate General of China in Odessa. During the reception, the PRC's being interested in Ukrainian ports as a part of the transport communications of “The Belt and Road” was confirmed.