October 1, 2021 – Stealth War 57: China Marks National Day; New Aircraft and Drones; Meng Wanzhou’s Homecoming; Power Outages; China-Pakistan Economic Corridor

By: Jamestown Foundation

Wed October, 2021, Age: 3 months

 


October 1, 2021

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Strategic Indicator
This issue’s number to watch$385 Billion
Amount of ‘hidden debt’ owed to China by 165 countries for Belt and Road Initiative (BRI) projects.

This Week:

* China Marks National Day as Xi Intensifies Crackdown

* China Unveils New Aircraft, Drones at Zhuhai Airshow

* Huawei CFO Meng Wanzhou’s Homecoming Celebrated as Patriotic Moment in China

* Government Electricity Controls, Coal Shortages Lead to Widespread Power Outages

* BRI Roundup: Pakistan PM Imran Khan doubles down on China-Pakistan Economic Corridor (CPEC)

Top Stories

(source: Global Times)

China Marks National Day as Xi Intensifies Crackdown 

China celebrates its National Day today at a moment of rising political uncertainty. General Secretary Xi Jinping has championed the Mao-era concept of “common prosperity” and has orchestrated a sweeping crackdown on China’s once untouchable business tycoons, particularly those in the technology and entertainment industries. He has overseen the implementation of a growing litany of restrictions on economic and social behaviors ranging from youth gaming to bitcoin mining.

As the Australian journalist and long-time China watcher Richard McGregor recently wrote in a Nikkei Asian Review piece entitled “Bombard the headquarters: Xi Jinping’s crackdown keeps growing,” the party’s push for common prosperity “did not fall from the sky.” China has debated how to address widening income inequality since market forces were first unleashed in 1978. That debate appears far from settled today, and as a result, Xi’s leftward lurch has sparked a rare public divergence among China’s political elites. Those on the ultra -left, whose views were epitomized in a recent blog post by Li Guangman that was widely re-published by state media, have cheered what they view as a necessary correction for China’s reform era excesses that have given rise to a culture dominated by effeminate pop stars, anime, youth gaming, and flashy billionaires like Ali Baba’s Jack Ma. However, pragmatist elements have expressed growing unease with recent developments and have stressed the salience of  private enterprise and innovation to China’s growth. Perhaps the most prominent exponent of this view is Xi’s economic czar- Vice Premier Liu He, who recently commended the private sector and called it essential to China’s development.

(source: Global Times)

China Unveils New Aircraft, Drones at Zhuhai Airshow

China kicked off its annual Aviation and Aerospace Exhibition in Zhuhai, Guangdong on Tuesday. This year’s airshow featured the release of several new aircraft including a J-20 stealth plane with a domestically produced jet engine. Several prototypes of new unmanned aerial vehicles (UAVs) were on display including the WZ-7 Xianglong – “Soaring Dragon” – a high-altitude, long distance UAV, and the CH-6 – a new attack drone able to carry out combat roles such as air support and anti-submarine warfare, as well as early warning operations.

The airshow also featured the world’s largest amphibious aircraft- the AG600, which displayed its capacity for aerial water-dropping.The technologies revealed at the airshow demonstrate that China has made progress in mastering some technological capabilities on which it has historically relied on foreign technology. For example, the PLAAF has been historically reliant on Russian-produced technology for advanced jet fighter engines, but appears to be developing the capacity to indigenously manufacture its own engines.

(source: New York Times).

Huawei CFO Meng Wanzhou’s Homecoming Celebrated as Patriotic Moment in China 

Huawei Chief Financial Officer Meng Wanzhou was greeted by a cheering crowd as she stepped off a plane in Shenzhen following her nearly three year detainment in Canada. “After more than 1,000 days of torment, I am finally back in the embrace of the motherland,” she said in a brief, but tearful, speech on the tarmac. Meng’s release occurred on the same day that  the ‘two Michaels’ Michael Kovrig and Michael Spavor were released from nearly three years of detention in China. It is widely believed that Beijing detained the two Canadians as a form of “hostage diplomacy” in response to Canada’s December 2018 arrest of Meng on a U.S. extradition request.

The Huawei executive, who was held in Vancouver as the legal process ran its course, thanked the CCP and General Secretary Xi Jinping for her safe return, noting that “for nearly three years, there was never a moment when I did not feel the care and warmth of the party…President Xi Jinping cares about the safety of each and every Chinese citizen, including me.”

State media shared news of Meng’s impending return to China, and by the time her plane arrived, people had gathered at the Shenzhen airport to celebrate her return. A McDonald’s worker who was interviewed at the international arrival gate, said, “This is big news and worth nationwide celebration… Watching videos of her speech had me in tears.” A passenger on Meng’s flight said, “Meng Wanzhou’s release marks a temporary victory for China in diplomacy.” Soundbites of Meng’s arrival went viral on Chinese social media, yielding thousands of nationalistic and emotional posts: “Without a powerful motherland, I would not have the freedom I have today” being one of the most popular. Meng has announced that she is looking forward to celebrating China’s National Day this week.

(source: Vox )

Government Electricity Controls, Coal Shortages Lead to Widespread Power Outages

Millions of homes and businesses in China have faced power outages over the past week. Chinese manufacturing is encountering heightened demand for electricity amidst an economic rebound that has outpaced the rest of the world during the COVID-19 pandemic. At the same time, coal prices have risen, but coal-fired power plants remain bound to government-controlled electricity prices. In addition, China continues to rely on coal as its main source of power, but  government officials are also under pressure to reduce carbon emissions. Facing financial pressure from coal prices rising faster than revenue and political pressure from government officials, power plants have reduced production, leading to a nationwide electricity shortage.

Guangdong, Heilongjiang, Jilin and Liaoning provinces have faced the most acute power outages, although reports of blackouts have also been reported elsewhere. The outages bode poorly for China’s economic growth, which in September 2021, experienced the largest decrease in manufacturing output since the COVID-19 pandemic began in February 2020. Energy shortages are also especially concerning as the country approaches winter, with intense cold bringing increased demand for electricity. China’s National Development and Reform Commission has announced measures to increase industrial output, although without raising electricity prices, the prospects for long-term success remain in question.

BRI Roundup

(sources: BBC)

BRI Roundup: Pakistan PM Imran Khan doubles down on China-Pakistan Economic Corridor (CPEC) 

Pakistan Prime Minster Imran Khan is doubling down on his country’s commitment to the China Pakistan Economic Corridor (CPEC), promising to fast track $60 billion worth of projects that have stalled due to the COVID-19 pandemic. Chinese Ambassador to Pakistan Nong Rong, who spoke alongside Prime Minster Khan, touted CPEC’s contribution to Pakistan’s development in providing $25.4 billion in investment, and creating 75,000 jobs. Nevertheless, CPEC has faced criticism for corruption and not doing enough to create economic opportunities for regular Pakistanis.

The renewed commitment to CPEC comes as China and Pakistan are in talks with the Taliban government in Kabul to potentially expand the corridor in to Afghanistan. Khan noted that counterparts in Kabul had expressed a great deal of interest in the project, and that extending the project into Afghanistan can improve connectivity with other neighboring countries including Iran, China, and Central Asian countries.

Despite the optimism surrounding CPEC, the project has not been without problems, and has been targeted by extremist and separatist groups in Pakistan. For example, in August, a Chinese national was injured and two local children were killed when members of the Balochistan Liberation Army, a militant Baloch separatist group, launched a suicide attack in Gwadar Port.

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