Tag Archives: Wang Qishan

UK And China In Diplomatic Tiff Over Queen’s Lying-In-State

THE SPEAKER OF the UK House of Commons has reportedly banned any Chinese delegation that might attend the state funeral of the late Queen Elisabeth II from viewing her lying-in-state in Westminster Hall.

The hall is part of the parliamentary complex and is under the joint administration of Parliament and the Crown. The ban would not apply to the funeral itself on September 19. That will be held in Westminster Abbey, which is under the authority of the Crown alone.

The Commons Speaker, Sir Lindsay Hoyle, is understood to have refused a request for access to Westminster Hall over Chinese sanctions against five members of the House of Commons and two members of the House of Lords.

China imposed sanctions in 2021 on the seven parliamentarians and two others for accusing Beijing of mistreating Uighur Muslims in Xinjiang.

Last September, Sir Lindsay told Zheng Zeguang, China’s ambassador to the United Kingdom, that he could not come to Parliament because of Beijing’s sanctions, a ban decried by Beijing as ‘despicable and cowardly’.

The United Kingdom has not seen the death of its head of state for 70 years. However, the protocol would be to invite the heads of state of all countries with which London has diplomatic relations to attend the funeral.

There had been some discussion in London, however, whether President XiJinping should be invited given the present low state of bilateral relations, strained by concerns ranging from human rights in Xinjiang and Hong Kong to Russia’s invasion of Ukraine.

While an invitation was issued, it was not expected that Xi would attend but that Bejing would send a delegation led by Vice-president Wang Qishan, who earlier this week signed the condolences book at the British embassy in Beijing.

On September 16, the foreign ministry said it was still deciding whether to send a delegation.

If one does attend the funeral, its members will pass under a statue of Wang Zhiming, a Christian pastor in Yunnan martyred during the Cultural Revolution. He is one of ten 20th-century Christian martyrs memorialized above the Great West Door of Westminster Abbey.

The diplomatic tiff may presage a further deterioration of relations between London and Beijing. The new UK prime minister, Liz Truss, has signalled her intent to be more hawkish towards China than her predecessor Boris Johnson and may formally recognize the treatment of the Uyghurs as genocide.

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China And US Seek Their Own Win-Win In Davos

 

Chinese Vice-Premier Wang Qishan address the World Economic Forum at Davos, Switzerland on January 23, 2019OUR MAN IN Davos sends word that he can barely pick his way through the crowds at the annual gathering of the world’s great and the good at the World Economic Forum without tripping over yet another member of the largest government delegation China has ever sent, not to mention more than 50 leading Chinese chief executives and their entourages.

Their presence is even more noticeable in the absence of a US delegation, US officials being instructed by President Donald Trump not to attend because of the US government shutdown.

The ‘optics’, as they say, of the US president rubbing shoulders with the global elite at a time when many of the 800,000 US federal workers furloughed by the shutdown were queuing at soup kitchens or for unemployment cheques, would not look good to his still-adoring domestic electoral base. However, it is easy to imagine also that Trump would not find the Burning Man of globalisation much to his ‘America First’ tastes, or his reception particularly warm.

Vice-president Wang Qishan, leading the Chinese delegation and vying with outgoing German Chancellor Angela Merkel as the star political turn this year, certainly gave the United States the thinnest of thinly veiled workings over.

While painstakingly mentioning neither Trump nor the United States by name, his speech relayed a self-confident message of the great renewal of the Chinese nation and how China was duly asserting its place in the world, one that was a leadership role.

In essence, that message was:

It is a new world. China’s is back. It is a world player and you, United States, had better realise that not only do you no longer rule the roost alone, but we and the other developing nations are no longer going to be takers of the rules of the global order that you alone write, but givers of those rules. And, by the way, don’t bully us over technology, and don’t interfere in our national sovereignty or economic and industrial policy, i.e., lay off Made in China 2025. We can run our economies as we choose, not how you say.

Wang did not, of course, use any of that language; it is entirely our man’s decoding.

How Wang expressed it was:

Adjustments need to be made both economies and societies domestically and to the rules of the international order of economic governance…[China has] the right to take part in the global technological governance system as equals…It is imperative to respect national sovereignty and refrain from pursuing technological hegemony, interfering in other countries’ domestic affairs, and conducting, shielding or protecting technology-enabled activities that undermine other countries’ national security…We reject the practices of the strong bullying the weak and self-claimed supremacy.

Those are lines that do not take much reading between.

Wang also said:

Many countries are increasingly looking inward when making policies; barriers to international trade and investment are increasing; and unilateralism, protectionism and populism are spreading in the world. All these are posing serious challenges to the international order. Will economic globalisation move forward or reverse course? …What we need to do is make the pie bigger while looking for ways to share it in a more equitable way. The last thing we should do is to stop making the pie and just engage in a futile debate on how to divide it.

Even though US officials were not in Davos to rebut Wang, plenty of Western business leaders are there, and have let senior Chinese officials know in the private dinners that are the real power centres of Davos of their concerns over the way intellectual property protections are abused in China and the legal or illegal acquisition of Western technology IP in support of Made in China 2025.

And one US government heavyweight still managed some pre-emptive retaliation, US Secretary of State Mike Pompeo, who addressed the forum by video link the previous day

Pompeo rehearsed his stump speech from his recent swing through what Washington now calls the Indo-Pacific, where he warned of China’s state-centred economic model, its belligerence towards its neighbours, and its embrace of a totalitarian state at home, before holding out an olive branch of sorts:

There are those who say that conflict, superpower conflict between our two countries is inevitable – we don’t see it that way. We want to find places where we can work together.

The old win-win. The question is, will there eventually be just one winner?

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A Square Peg In A Round Hole

Wang Qishan is an experienced banker and has the most expertise among the likely candidates for slots on the Politburo standing committee when it comes to economic reform. Yet he is slated to be the Party’s top disciplinarian. Unless this is some deep seated plot to crack some of the most entrenched vested interests that stand in the way of economic reform, and this Bystander doubts it is, much as we would like it to be so, it does not bode well for the future of economic reform under the incoming leadership. Wang does have a track record of being a firefighter, though, so the crackdown on corruption could be more effective than was similarly promised when the Hu-Wen leadership took over a decade back.

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China Looking To Buy More Russian Energy On The Cheap

Russia’s president, Dmitry Medvedev, is due in Beijing at the start of next week for a state visit during which energy deals between the two countries will be on the agenda, particularly kicking on a stalled long-term deal for Russia to supply China with natural gas. The two countries are already striking deals on several energy fronts — coal, oil, atomic power and renewable energies, as well as natural gas — as Moscow seeks to expand its sales to what is now the world’s largest energy consumer and Beijing seeks stable long-term supplies to meet its needs.

At the end of August, a Chinese spur to Russia’s Siberian Pacific Ocean pipeline was completed, part of a 20-year $25 billion loans-for-oil deal between struck in 2008 between China National Petroleum Corporation (CNPC) and Russia’s largest oil company, Rosneft, and its largest pipeline operator, Transneft. Earlier last month, China said it would  lend Russia an additional $6 billion repayable in increased coal supplies over the next 25 years. This week, Russia’s Deputy Prime Minister Igor Sechin has been in Tianjin for an annual bilateral meeting on energy, during which three specific oil and coal deals were signed.

Sechin and his Chinese counterpart, Vice-Premier Wang Qishan, also found time to attend  a foundation-laying ceremony for the centerpiece of the oil deal, a new $5 billion joint venture refinery that will be 49% owned by Rosneft, 51% by CNPC. Rosneft will supply some two-thirds of the 10 million metric tons of crude a year that will be processed  by the Tianjin refinery. This will be the first time a foreign oil company has had such a significant presence this far downstream in the Chinese oil industry, and that will be extended in a planned second stage of at least 500 retail gas stations in China.

The 2008 loans-for-oil deal lets China import 300,000 barrels a day of Russian oil for 20 years starting in 2011 on pricing terms favorable to the Chinese side. Russia is hoping that any natural gas deal it can strike during Medvedev’s visit won’t be so one-sided, though the precedents aren’t encouraging. Late last year, tentative agreement was reached to build two gas pipelines with the capacity to deliver 68 billion cubic meters of Russian natural gas per year, but pricing issued have stalled further progress on a delivery contract for the natural gas. Medvedev is likely to propose a scaled back deal to supply 30 billion cubic meters per year. Given the competition from Central Asian natural gas, he may not be able to make much headway on getting Beijing to pay anything approaching market prices, but even getting the negotiations going again would be progress.

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China’s Turn To Lecture U.S. On Economy

Wrapping up the bilateral economic talks, U.S. Treasury Secretary Hank Paulson called them full of “straightforward back-and-forth”, while his counterpart Vice Premier Wang Qishan used the phrase “constructive, candid and pragmatic.” (Xinhua’s report on $20 billion trade aid and other agreements here.)

The global financial crisis dominated the meeting, giving Chinese officials an opportunity to lecture the U.S. about the shortcomings of its financial system as opposed to U.S. officials lecturing about China’s trade practices, currency, product safety and financial regulation, which is how these biannual sessions have tended to go in the past.

There is no high ground for anyone to occupy any more.

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Wang Tells Paulson That The U.S. Has To Look After China’s Interests There

A curious turn of phrase from Vice-Premier Wang Qishan during his opening speech at the latest bilateral strategic economic talks with his American counterpart U.S. Treasury Secretary Hank Paulson:

”I hope the United States will take all necessary measures to stabilize its economy and financial markets as soon as possible and to ensure the security of Chinese investments and interests in the United States.”  (fuller reports from Xinhua here).

The first half of that is straightforward enough and could have come from any recent meeting of international leaders from the G-7 up. But to what does the second half refer? Investments by state agencies such as China Investment Corp. and state-controlled banks and other enterprises which have been battered by the fall in global equity markets? We noted yesterday that CIC had lost $6 billion on its stakes in two U.S. financial firms, Morgan Stanley and the Blackstone Group.

Or was Wang referring to the 60% of China’s $2 trillion of reserves that are held in dollar assets? A substantial share of those are U.S. Treasury bonds and debt issued by troubled U.S. mortgage lenders Freddie Mac and Fannie Mae, both now effectively under U.S. government control.

It is no secret that some top officials have been worried for a while that the dollar’s decline was eroding the value of those holdings and questioning whether it made sense for China to continue to increase them. Not that the dabbling in equity markets by way of diversification and to juice yields to offset that has necessarily turned out well in the circumstances (see CIC above).

However, with the U.S. having to fund an expensive bailout, and China being one of the primary surplus countries that will have to provide the cash, the internal debate about growing China’s dollar-denominated reserves will continue. China has little choice but to continue to fund America’s deficits if it wants to avoid global recession, but it also wants to avoid throwing good money after bad. One sign of its willingness to get tougher with the U.S. over this is its willingness to let the yuan depreciate against the dollar over recent weeks, a move that helps China’s exporters even though it reverses Beijing’s compliance with the U.S.’s long standing pressure to get the yuan to rise against the dollar and to stop being what its American critics, including President-elect Barack Obama, have called a currency manipulator.

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