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Fw: Why has China avoided congratulating Biden on his election victory?

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On Monday, November 9, 2020 8:37 PM, Jeremy Goldkorn | SupChina <jeremy@supchina.com> wrote:

The week in China news
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SupChina Weekly Newsletter
Monday, November 9, 2020

Dear reader,

China is playing it carefully in its dealings with the U.S. right now. Beijing has avoided congratulating Joe Biden on his election win, and also did not include U.S. travelers in its new entry bans announced last week, despite the tsunami of COVID-19 infections in America. Read our first story below for reasons why Beijing has not yet called Biden.  

The implications of a Biden presidency on Sino-global relations is the theme of our NEXTChina online conference happening this week, Wednesday and Thursday, November 11–12. Get your tickets here.

Understand China better by subscribing to our premium membership, SupChina Access. You'll get a daily newsletter with in-depth analysis and full context on the latest in China and its relations with the world, among many other benefits such as free entrance to our events, including NEXTChina.

—Jeremy Goldkorn, Editor-in-Chief



1. Why has China avoided congratulating Biden on his election victory?

U.S. Vice President Joe Biden meets with Chinese leader Xí Jìnpíng 习近平 in Davos, Switzerland, on January 17, 2017. Photo from Xinhua via gov.cn.

As American news outlets began to confirm, on November 7, that Joe Biden had received the most votes in the decisive state of Pennsylvania, President Trump falsely claimed that he had "won this election, by a lot!" The official newspaper of the Communist Party of China, the People's Daily, joined in the deluge of derision that followed on Twitter, replying to Trump, "HaHa🤣."

  • The People's Daily later deleted that tweet (click here for a screenshot), and official state media has remained tight-lipped since then in its reaction to the election result.
  • The Chinese Foreign Ministry, one of the most authoritative voices in the Chinese government — a Twitter account of even an official newspaper has questionable significance — later chimed in with this evasive statement (English, Chinese) on the election:

…we noticed that Mr. Biden has declared election victory. We understand the presidential election result will be determined following the U.S. laws and procedures.

[As to when China will send a congratulatory message], we will follow international customary practices.

Why is China avoiding congratulating Biden? The leaders of almost all major countries, with the exceptions of China, Russia, Turkey, Mexico, and Brazil, have said they have spoken to president-elect Biden.

  • Beijing may see the outcome as disputed, as long as President Trump does not concede, and does not wish to be accused of "election interference" by the Trump administration.
  • Last week, Beijing also avoided provoking the U.S. by banning travellers from many countries, but not from America, despite a huge surge in new coronavirus cases.

See also: 'The Trump reality show is over': Chinese social media users react to Biden's presidential win.


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What will the U.S. election results mean for China? What will they mean for the future of the U.S. in the world?

This year's NEXTChina will gather some of the world's leading experts on all things China to discuss how the U.S. presidential election results will reshape the next four years of geopolitics and business.

Get your tickets today!


2. Ant Group IPO suspended after Jack Ma criticizes regulators

Illustration by Derek Zheng

Late on Monday night last week in China, the Shanghai Stock Exchange (SSE) published a surprise announcement (in Chinese): After Ant Group's "actual controller" (Jack Ma 马云 Mǎ Yún), chairman, and general manager underwent "supervisory interviews" with regulators, the exchange had made the decision to postpone Ant's gargantuan IPO.

The SSE didn't explain in detail why the suspension had been made, and merely referred to "changes in the fintech regulatory environment" that may lead to Ant failing "to meet the conditions for issuance and listing or the requirements for information disclosure."

  • The regulatory changes likely refer to new microlending restrictions, announced earlier yesterday by The People's Bank of China (PBOC) and the China Banking and Insurance Regulatory Commission (CBIRC). Sources told Reuters that regulators had told Ant "to properly comply with the new micro-lending rules."
  • These regulations were expected to "severely hurt" the valuation of Ant, Caixin reported.

Crucial context: Jack Ma went out of his way to complain about China's financial regulators at a financial forum the week before last, and accused traditional Chinese banks of operating with a "pawn shop mentality."

Four possible explanations

Based on reporting and commentary in the Wall Street Journal, the New York Times, the Financial Times, Reuters, and elsewhere, here are four possible explanations for the postponement — though none of them are mutually exclusive, and the reality could be a combination or include another factor we don't know about.

  • Beef with bureaucrats: Jack Ma's criticism of regulators led to their retaliation, as they took advantage of changing rules and the complexity of Ant's business to hold up the listing on a detail they might have otherwise let slide.
  • Too big for comfort in Shanghai: The investor enthusiasm for the IPO was so overheated that regulators saw significant market risks that could put the prestige of the Shanghai STAR market in danger.
  • Too big for comfort in Beijing: Maybe regulatory details and economics had less to do with the action, and top government leaders were considering holding up the IPO even if Jack Ma had done everything right, in order to demonstrate that even the most successful Chinese businesses depend on Beijing's approval.
  • Genuine regulator discomfort with Ant's size and sway over China's financial system. If this is the case, Tencent can expect scrutiny, too. (On Chinese social media, popular opinion seems in favor of the regulators, with many users describing Ant Group as a loan shark.)

Ant's IPO is likely to still go ahead, according to most commentators. But it will probably be a smaller event, and with a chastened Jack Ma at the top. Despite Ma's insistence that Ant is a "techfin," not "fintech" company, he may have to submit to stricter finance industry regulations before going forward with the IPO.


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3. Nanjing launches chip university in bid to fill China's semiconductor talent gap

The newly opened campus of Nanjing Integrated Circuit University. Image source: Eefocus.com.

On October 22, Nanjing launched China's first integrated circuit university as the country attempts to address a talent shortage in the semiconductor industry, Xinhua reported (in Chinese). Amid pressure from U.S. decoupling, China has established Nanjing Integrated Circuit University (NICU) in a bid to boost domestic chip manufacturing and technology innovation capability.

NICU is not a traditional "university," but a "talent training organization."

  • NICU does not recruit high school graduates from the national college entrance examination, but will select college and university graduates who already have relevant knowledge, or those who have an interest in working on integrated circuits. NICU will also train junior staff for integrated circuit companies.
  • People who attend NICU will be called "learners" (学员 xuéyuán) instead of "students" (学生 xuéshēng), and will receive a certification of completion upon graduation but not a degree diploma.

NICU is not under the Ministry of Education or provincial and municipal education authorities like nearly all Chinese higher-education institutions. It was founded by the management committee of Nanjing Jiangbei New District, a national-level special economic zone where NICU is located.

  • Rather, the integrated circuit university will focus on boosting China's chip manufacturing capability, according to Shí Lóngxīng 时龙兴 (in Chinese), president of NICU and dean of the Electrical Science and Technology School of Southeast University.
  • Courses are based on chip companies' job descriptions and learners' knowledge gaps, designed to teach practical and specialized skills. Veteran chip engineers, industry experts, and university professors are expected to teach at NICU.

Nanjing has big semiconductor ambitions. The Nanjing Linjiang New District has already attracted:

  • TSMC, Taiwan's top chipmaking company and the world's largest semiconductor manufacturer, which established a chip factory in Linjiang New District in 2016 (in Chinese).
  • Nearly 400 integrated circuit companies, forming a supply chain surrounding chipmaking worth 50 billion yuan ($7.5 billion), according to Xinhua (in Chinese).

But media and industry experts have cast doubt on whether NICU can address China's talent shortage. Social media users said NICU will likely be training equipment operators instead of top engineers and scientists that China urgently needs.


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4. China issues temporary travel bans for six countries as COVID-19 spikes in Europe

Police officers on horses check exemption certificates and verify identities in Paris, France, after the country reimposed a monthlong nationwide COVID-19 lockdown on October 31, 2020. REUTERS/Benoit Tessier.

After the initial phase of the COVID-19 outbreak in China, when Beijing fiercely criticized other countries for blocking Chinese citizens at their borders, Chinese officials changed their mind about travel bans.

Now some restrictions are coming back, for at least six countries. Chinese embassies last week announced temporary bans on non-Chinese citizens traveling to China. These countries include:

  • Belgium
  • France
  • The United Kingdom
  • India
  • Bangladesh
  • The Philippines

Half of these countries — the ones in Europe — have indeed seen alarming spikes in COVID-19 cases. Belgium has some of the most new cases per capita out of any country, and France and the U.K. both recently announced nationwide lockdowns.

  • The British Chamber of Commerce in China didn't appreciate what it called the "abruptness of the announcement and the blanket ban on entry," and said that it would "await further clarification on when it will be lifted."
  • The selection of the other three are harder to make sense of at first glance. Sixth Tone points out that "neither Bangladesh nor the Philippines is currently experiencing a dramatic uptick in cases." India's per-capita cases are only slightly higher than Bangladesh's.

More travel restrictions coming?

It might not be worth looking too much into the choice of countries that China has put travel bans on, at least not yet, because different types of restrictions are being applied widely, and more could be coming soon.

  • Negative COVID-19 and antibody tests before travel are required for "most if not all foreign and Chinese nationals flying" into China as of last week, Sixth Tone reported.
  • The dual test requirements began to apply for passengers from the United States, France, Germany, and Thailand on November 5, and were extended to Australia, Singapore, and Japan from November 8.
  • An unofficial travel restriction also came last week when "China Southern Airlines, the country's biggest carrier by passenger load, said it would suspend transit services for passengers embarking from 21 countries, mostly African and Asian countries and including India and the Philippines," per Reuters.

However, as with the earlier reopening to foreign permanent residents, we think it is notable that the U.S. has not been singled out for a travel ban by Beijing — and suspect that this is likely a calculated move by China to avoid escalating tensions amid the American election.

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A message from Schwarzman Scholars

Schwarzman Scholars is hiring for a variety of short-term visiting faculty positions for Schwarzman College at Tsinghua University.

  • The Bank of America Merrill Lynch Visiting Faculty Chair in International Finance
  • The Boeing Visiting Faculty Chair in International Relations
  • The Citi Visiting Faculty Chair in International Business
  • The Johnson & Johnson Visiting Faculty Chair in Leadership
  • The Tencent Visiting Faculty Chair in Technology
  • The Volkswagen Visiting Faculty Chair in Sustainability
  • The Walt Disney Visiting Faculty Chair in Global Media

Schwarzman College is also recruiting for several open rank permanent faculty positions.

Job descriptions with full details for all of these opportunities can be found here!


5. Chinese mom shares frustration over storing breast milk. Trolls slam her as 'selfish' and 'gross.'


Breastfeeding can be a surprisingly contentious topic in China, and last week saw yet another breastfeeding controversy: a national debate about how nursing moms should store their breast milk while on the road.

In a since-deleted video on Douyin — the Chinese version of TikTok — uploaded on October 31, a breastfeeding mother recorded herself making a complaint while riding a high-speed railway train. "This train has a fridge to keep beverages chilled, but I'm not allowed to put two bags of breast milk there," the woman said while showing the containers on her tray table.

  • "The train attendants denied my request, saying it's for the sake of food safety," she continued, adding that when she called the customer service hotline of the railway company, she was given the same answer.

The woman soon found herself in the eye of a social media storm. The responses to the clip were quite the opposite of what she had hoped for.

  • "Who knows if the fluid in the bags was breast milk or something else? The pandemic is not completely over yet and she's risking other people's lives. It's ridiculous that she thinks she's entitled to do everything her way just because she's a mother," a typical comment said (in Chinese).
  • Another Douyin user wrote, "Why did she have to pump and bottle her human milk beforehand? It caused trouble for everyone who was on the train."
  • Legal experts were quick to chime in with their thoughts on the issue. Siding with the railway company, the vast majority of them dismissed the woman's request as "frivolous" and said they saw no fault on the train's staff's part.

But Orange Umbrella, a Chinese nonprofit organization that advocates for gender equality, saw the controversy in a different light. In an article (in Chinese) published on November 4, the organization wrote that the backlash against the woman was unfair, and that the debate over the railway company's legal responsibilities was beside the point.

  • The organization also noted that most high-speed trains don't have private rooms or spaces for moms to breastfeed. Due to the lack of supportive policies and resources, breastfeeding moms are left with no options but to pump and bottle breast milk before traveling.
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