The great pivot – ChinaDiction #73
Everything, everywhere, all overnight – and apparently on the fly.
‘A4? Let Them Eat Plague’ as one Marxist newsletter puts it. Photo: Source unknown.
Welcome to the Year of the Rabbit and to a China in the midst of a sharp, unexpected U-turn on its key viral containment strategy – Zero Covid – which has been replaced by what some in the West have labeled “let it rip.”
In the meantime, ChinaDiction has been absent from your inboxes for rather too long. Work and Christmas/New Year intervened. We’re back and – all being well – will be at least once a week for the rest of the Rabbit. Apologies.
So, what happened (in China, not with ChinaDiction)?
Frankly – and it would be dishonest to pretend otherwise – heaven knows. As Wang Xiangwei, former editor of the South China Morning Post, notes in a translation of an interview with Danish media in his Substack:
No matter how you look at it, China should have had an exit strategy. They had three years to learn from other countries’ reopening, but they learned almost nothing. It shows the chaos of the last few weeks, where hospitals are overloaded and morgues are overflowing with bodies.
Of course there were signs – there always are in retrospect: online rumors and verified reports, in Shanghai and Beijing at least, of protests after three years of extreme rolling lockdowns, local governments overstretched by the costs of relentless testing, nationwide economic malaise on a scale not seen in decades, and of course the remorseless mutational evolution of the virus itself as it seemingly became (and is still becoming) more transmissible by the day.
As the Wall Street Journal (paywall) wrote at the time, Terry Gou, chairman of the world’s largest iPhone assembler, Foxconn, weighed in with a letter warning China’s leadership of the risks of continuing with its zero covid policy.
In the letter to Chinese leaders, Foxconn Technology Group founder Terry Gou warned that strict Covid controls would threaten China’s central position in global supply chains …
… Chinese health officials and government advisers seized on Mr. Gou’s letter to bolster the case that the government needed to speed up its efforts to ease its tough Covid-19 controls, people familiar with the matter said. The eruption weeks later of nationwide protests gave policy advisers further ammunition to press the case for relaxing measures, two of the people said.
Seasoned China watcher Anne Stevenson-Yang of J Capital Research told The Market, “I have to say I think there has been some kind of quiet internal revolt against Xi Jinping’s personal rule …
… Going into the 20th Party Congress, everybody expected that there would be a Standing Committee balanced between Xi allies and others. As we know, that didn’t happen. They all turned out to be Xi allies. But then, the protests broke out, and for the very first time I ever heard of in China, at least since 1949, people generally criticized the government and the CCP and demanded that Xi step down. That’s truly new and highly dangerous for the party.
Think of all the ways in which Xi must have offended the blooded elites: Xi seems to have inserted his own slate of ‘selectees.’ The former president [Hu Jintao] was escorted out of the big party meeting in front of cameras and in front of his own son, and no one even looked at him, much less stood up to assist. There had been a couple of arrests and harsh sentences for very high-ranking officials. That’s why I think that these recent developments must have been a bridge too far for Xi’s supporters.
In short, you can’t keep an aerosol virus at bay and you can’t lock 1.4 billion people down forever before either the virus comes for you or the 1.4 billion people come for you.
This belies Xi’s professed conviction that China could wield an iron rod and contain the virus like no democracy ever could.
Other analysts have pointed at purely pragmatic reasons for the overnight pivot. The Spectator (porous paywall) commented:
For the first time ever, the Chinese government appears to have admitted the real reason – zero Covid was failing to control the Omicron variant. In October, ‘new domestic cases kept appearing, signs of rapid transmission became ever more prominent, involving 31 provinces, regions and cities, with some regions seeing new infections for around three months, and the social cost of pandemic control climbed,’ wrote the Xinhua News Agency.
The reality is probably that Beijing caved on a combination of all the above and now the entire country is on Spring Festival vacations.
Demand for hotels, guest houses and tickets to visit tourist attractions at the start of the holiday exceeded comparable figures in 2019, before the pandemic began, according to the online travel agency Trip.com.
The government expects roughly 2.1 billion trips will be taken during the 40-day Spring Festival period, nearly twice as many as last year, according to Transport Vice Minister Xu Chengguang. The crushing demand underscores a rebound in holiday travel and consumption as people put Covid worries behind them.
Meanwhile, China’s top economic advisor Liu He made an appearance in Davos to reassure assembled global business and policy elites that “China is back,” according to many reports, including the Financial Times (paywall):
‘It was very much like 2017,’ [a] person said, referring to Xi Jinping’s trip to Davos, during which the Chinese leader defended globalisation.
‘They are reversing everything that has been done in the last three years,’ said one attendee. ‘They will be business-friendly and [know] that the economy cannot be successful without the private sector.’
No doubt an unduly optimistic assessment, particularly given what happened after Xi defended globalization in 2017, but definitely – along with the climb-down from a zero-tolerance approach to Covid-19 – a sea change of some kind is underway.
For one thing, Zhao Lijian, notorious Minister of Foreign Affairs spokesman and CCP “wolf warrior” Rottweiler, has been sidelined to what some observers have called the MoFA’s “Siberia,” the Department of Boundary and Ocean Affairs.
Good riddance. But let’s not imagine for a minute that what’s happening in China – as possibly momentous as it may seem – is anything more than a change of strategy: more carrot, less stick.
As for Covid-19, we won’t get reliable numbers on infections and deaths, but we will likely get leaked intimations of just how neglected China’s healthcare sector has been in favor of glamor infrastructure projects like high-speed rail, as per this BBC report:
Some 80% of the population – more than a billion people – have been infected since China scrapped restrictions in December, according to leading epidemiologist Wu Zunyou. Last weekend China reported 13,000 Covid-related deaths in less than a week, adding to the 60,000 deaths it has counted since December.
But these deaths have been in hospitals. In rural areas there are only sparse medical facilities and those who die at home are mostly not being counted.
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Zero-Covid protesters arrested
Photo: Envato Elements.
Protesters against Zero Covid, many of them young women, are being quietly rounded up and arrested, even as state media lauds China’s reversal of the policy as the right thing to do.
As the New York Times (paywall) puts it:
China is waging a campaign of intimidation against people who joined the demonstrations, which were the boldest challenge to the Communist Party’s rule in decades and an embarrassing affront to its leader, Xi Jinping.
The party seems determined to warn off anyone who may have been emboldened by the remarkable outburst of public discontent, which was followed just days later by Beijing’s abrupt decision to abandon Covid restrictions. Since then, domestic challenges have mounted: Youth unemployment is high, the economy is slowing, and Covid infections and deaths have accelerated.
The protest in Beijing on Nov. 27 began as a candlelight vigil for at least 10 people who died in an apartment fire in the far-western region of Xinjiang in November. Many Chinese believed that Covid restrictions had prevented the victims from escaping, though the government denied that.
The Wall Street Journal (paywall) notes that those targeted are largely inexperienced activists who …
… filled the void of a loose network of human-rights lawyers, activists and nongovernmental organizations that has largely been dissolved during President Xi Jinping’s time in power.
The friends that went to the Beijing rally on Nov. 27 aren’t organized activists, but are an idiosyncratic clique of writers, editors, filmmakers and artists.
‘The experienced activists had been disbanded, and then all that was left was a group of idealistic, bookish young people without much political experience,’ said Lü Pin, a U.S.-based Chinese feminist organizer. ‘Now, even these people have been rounded up.’
Rural medical supplies in short supply
Photo: Envato Elements.
The risks of a precipitous shift in health policy from zero tolerance to “bring it on” are being tragically underscored throughout China, but reportedly nowhere more so than in rural China, where even basic medical facilities are in short supply.
The Financial Times reports that countryside medical shortages are also being compounded by regulatory hurdles.
One doctor told the FT that in the case of anti-virals such as Paxlovid and Azvudine, a domestic Chinese antiviral:
Regulatory barriers prevented staff from easily prescribing them. Because of the scarcity, hospitals have to request approval from the local government for each prescription. “It is too troublesome,” the doctor said.
At issue: China’s National Healthcare Security Administration claims that Pfizer is charging too much for Paxlovid while Azvudine, which is based on an HIV treatment, is claimed to have genetically damaged cells in testing by China’s pharmaceutical regulator.
Meanwhile, as China’s rural poor suffer, Pfizer is not backing down:
‘They are the second-highest economy in the world,’ Pfizer chief executive Albert Bourla told a conference in San Francisco this month. ‘I don’t think that they should pay less than El Salvador.’
The Great Drive Forward
A Polestar Showroom in Oslo. Photo: WikiCommons.
Bloomberg reports that China-made electric vehicle (EV) passenger automobiles are poised to take the No 2 spot on global markets and few saw it coming.
Overseas shipments of cars made in China have tripled since 2020 to reach more than 2.5 million last year, according to data from the China Passenger Car Association. That’s only a whisker (about 60,000 units) behind Germany, whose exports have fallen in recent years. China’s numbers, behind Japan but ahead of the US and South Korea, herald the emergence of a formidable rival to the established auto giants.
The surge in Chinese EV passenger vehicle exports has largely focused “on Europe, Asia and Latin America” and has for the most part gone unnoticed in the US.
It’s a far cry from 2007, when a series of test failures appeared to spell the end for China’s EV ambitions. But Chinese manufacturers have bounced back.
Thanks to increasing automation and resulting standardization, Goldman Sachs Group Inc. says new auto plants in China have the highest levels of robot usage in the world … As quality improved over the past decade, Chinese cars started acing European safety tests. China’s tough curbs on air pollution have also helped most of its cars meet European emissions standards.
Xi’s ideological mastermind tasked with new Taiwan strategy
Wang Huning, seated center, the intellectual luminary thought to be behind most of Xi Jinping’s “thought.” Photo: WikiCommons.
Nikkei Asia reports that Xi Jinping’s intellectual right-hand man, Wang Huning, has been made responsible for coming up with an alternative to “one country two systems,” which Taiwan has seen in action in Hong Kong and roundly rejects.
The Nikkei claims to have an inside source who indicated that following Xi Jinping’s successful bid for a third term Premier Li Keqiang and Wang Yang stepped down while Wang Huning stayed on and his “mission is to lay the groundwork for Taiwan unification."
One source knowledgeable of China-Taiwan relations noted that Wang will be tasked with writing a theoretical unification strategy fit for the Xi era.
‘One may assume that a threat of China using force to unify Taiwan is imminent, but this is not the case. The first step is to launch a new theory that will replace Deng's one country, two systems. Then pressure will be put on Taiwan based on it,’ the source explained.
Yes, it’s all somewhat oracle bones and tea leaves, but it is plausible given Wang’s status as an intellectual giant in the field of Chinese Marxist theology.
The Greater Sinosphere
Chief Executive Lee hopeful prohibitions can be expanded
Hong Kong Chief Executive John Lee said last week that the Hong Kong government plans to enact a national security law in 2023 that will expand the range of activities prohibited under the current law.
In the aftermath of 2019 mass protests in Hong Kong, national security legislation was imposed to give local authorities sweeping powers to detain and arrest people.
Fast forward to 2023 and the authorities are, as Axios puts it:
… reshaping the city's judicial system to ensure a guilty verdict for pro-democracy media tycoon Jimmy Lai, who is on trial for ‘colluding with foreign forces’ under the national security law.
Chinese state English-language tabloid, The Global Times quotes Lee as saying:
‘To prevent possible risks, we need to adopt measures that could deter some external forces that could endanger the national security of Hong Kong."
There are many organizations of ‘foreign agents’ in Hong Kong under other names, such as institutions or so-called seminars, which are organizations "in disguise," Lee said. If there will be some preventive measures, some organizations ‘in disguise’ will not come to Hong Kong, or their numbers are likely to fall, he said.
Biden extends protections for Hongkongers in the US
The Wall Street Journal reports that President Biden extended the Deferred Enforced Departure program for Hong Kong residents, meaning they can stay in the US for at least two years even if their visas expire.
Protections for Hong Kong residents were set to expire on 5 February.
Under the program, Hong Kong residents can receive work permits so they can live and work in the U.S. legally while they are covered by the temporary humanitarian protections. Any Hong Kongers in the U.S., such as students, tourists or employees on work visas, are eligible, even if their visas have expired.
Photo: Envato Elements.
As of Wednesday next week, cannabidiol (CBD) – a largely non-psychoactive cannabis compound that some claim has promising health benefits – will be classified as “dangerous drug” with harsh penalties for its smuggling, production and possession, customs authorities announced Friday, according to the Associated Press.
CBDs have been available in bars and shops in Hong Kong, but trafficking and manufacturing them will now carry a maximum penalty of life imprisonment and a HK$5 million (US$639,000) fine.
Possession of the substance can result in a sentence of up to seven years and Hong Kong $1 million ($128,000) in fines.
In announcing the ban last year, the Hong Kong government cited the difficulty of isolating pure CBD from cannabis, the possibility of contamination with THC during the production process and the relative ease by which CBD can be converted to THC.
An election in brief
Chiang Wan-an and Tai Hsi-chin's Campaign Office, November 2022. Photo: WikiCommons.
Before our holiday season hiatus, ChinaDiction wrote (unpublished) that the Kuomintang (KMT) victory in the 2022 local elections was somewhat “underwhelming” – despite the fact that President Tsai Ing-wen (Cài Yīng-wén, 蔡英文) resigned as Democratic Progressive Party (DPP) chair in its aftermath.
The reasoning: the KMT picked up just one mayoral seat nationwide in comparison to 2018 when it won big but went on to get thumped in the 2020 presidential election.
The DPP even managed to gain 36 city councilor seats island wide while the KMT lost 28. Still, DPP administrations now only exist in the deep south. Even there, the DPP’s margin of victory was uncomfortably close in traditional strongholds like Tainan City and Pingtung County. In contrast, the center, north, and east of the island is a sea of blue (KMT in Taiwan’s color-coded political landscape).
This was by no means the majority view. As Bloomberg wrote at the time of the election results:
The ruling Democratic Progressive Party won just five of 21 city- and county-level races on Saturday, its worst showing since its founding in 1986. The opposition Kuomintang, which historically has an advantage in local elections, held onto 13 seats, gaining power in both the capital Taipei and export hub Taoyuan.
In any event, in Taipei – arguably the key electoral battle – the KMT ran a much stronger candidate in Chiang Wan-an (Jiǎng Wàn-ān 蔣萬安), allegedly – controversially in some quarters – the great grandson of Chiang Kai-shek.
Chiang is young, good looking, and highly articulate. His opponent Chen Shih-chung (Chén Shí-zhōng, 陳時中 ) uber-competent and reassuring as the face of Taiwan’s world class pandemic response, was inexperienced at electoral politics and clearly uncomfortable on the campaign trail.
Chiang’s victory was sealed by the fact that Taipei City has traditionally had a strong KMT power base.
Some outside Taiwan may wonder how Taiwanese voters could elect the great-grandson of a brutal dictator. In terms of historical memory, this is a misleading way to frame his victory, even if it makes for good news copy.
Chiang is the grandson of Chiang Ching-kuo (Jiǎng Jīng-guó 蔣經國), Chiang Kai-shek’s son and successor. Although Chiang II was in fact the architect of his father’s vast web of political terror, he presided over Taiwan’s economic boom and made a point of interacting with commoners unlike his autocratic father, whose style was very similar to that of Xi Jin-ping.
The younger Chiang’s memory continues to be venerated by many even if the elder Chiang is nearly universally vilified. In short, Chiang Wan-an benefited from positive memories of his grandfather – at least in some quarters.
Also, most Taiwanese chose to judge him based on his own individual character rather than that of his forefathers. It helps that Chiang is reasonably progressive. He was one of just a few KMT legislators who voted for same sex marriage, and he has even made timid noises about reconfiguring the Chiang Kai-shek Memorial that still squats as a once dominant tourist attraction for the non-communist Chinese diaspora in central Taipei.
President Tsai resigned as DPP party chair (for the second time) and earlier this month her deputy Lai Ching-te (Lài Qīngdé, 賴清德, formerly known as William Lai) formally took her place, and all eyes now are on the presidential elections, which will be held a year from now.
Any predictions on the outcome of the latter are pure conjecture at this point because possible runners include Vice President (and now DPP chair) Lai Ching-te, New Taipei City Mayor Hou You-yi (Hóu Yǒu-yí, 侯友宜), former Taipei mayor Ko Wen-je (Kē Wén-zhé, 柯文哲) and even Hon Hai Precision Industry Co founder Terry Gou (Guō Tái-míng, 郭台銘), who – as in the last presidential elections – is waiting for a go ahead from the gods, literally.
Michael Fahey in Taipei, Chris Taylor in Bangkok
It’s ‘yes’ to transnational same-sex marriage
Gay Pride March, Taipei. Photo: Hispanicpanic79; WikiCommons.
It’s been some time in the making, twisting and wriggling its way past many defeats in the Taiwan legal system, but transnational gay marriage is now legal in Taiwan, in what some are calling the last move by former premier Su Tseng-chang (Sū Zhēn-chāng, 蘇貞昌).
In short, Taiwan now recognizes same-sex couples from countries that do not recognize same-sex marriage.
It began when the The Taipei High Administrative Court ruled on July 21 last year that the marriage of a Japan-Taiwan same-sex couple should be legally recognized in Taiwan, even though it was not legal in Japan, reported the Asahi Shimbun at the time.
The Interior Ministry has notified the local governments about the change, which does not cover same-sex marriages involving Chinese citizens.
Taiwan was the first country in Asia to legalize same-sex marriages in 2019. but the law only allowed the Taiwanese to marry same-sex partners who were Taiwanese.
New premier in Cabinet shakeup
President Tsai Ing-wen has appointed former vice president Chen Chien-jen (Chén Jiàn-rén, 陳建仁) as Taiwan’s new premier in anticipated Cabinet reshuffle after former premier Su Tseng-chang announced the resignation of his Cabinet last week., according to the Taipei Times.
An epidemiologist, Chen had served as Tsai’s vice president during her first term between 2016 and 2020. As head of the Cabinet, the premier will be a pivotal figure ahead of next year’s [presidential] race.
Noodles with an agenda
Amid China’s bellicose, chest-beating “Taiwan is ours” rhetoric and almost daily East China Sea Air Defense Identification Zone (ADIZ) incursions, it’s easy to forget that Beijing would prefer to simply lure Taiwan into its fold with the promise of peace and prosperity – and snail rice noodles.
Nice try, but according to polls Taiwanese are taking the noodles and ignoring the message.
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