The headquarters of the Central Chinese Television (CCTV).
Axel Schmidt | DDP | Getty Images
China’s state-run media outlets have come out in force this week after keeping relatively quiet in the wake of U.S. President Donald Trump’s surprise announcement of tariff increases on Chinese goods.
Whether it’s the mouthpiece of the Communist Party or the national television broadcaster, the latest commentary exudes confidence about China’s ability to stand up to the U.S. That’s in contrast to a more muted press in preceding weeks. In an environment of tight government control of what messages are allowed to surface, the shift can shed light into what Chinese leaders are thinking about the drawn out trade negotiations.
“I expect it was ordered by the top leadership to forward the narrative of the U.S. as bully and China as victim,” said Scott Kennedy, director for the project on Chinese business and political economy at the Center for Strategic and International Studies.
“Putting the talks in broader normative terms gives (Beijing) leverage — ‘I can’t make big concession because my society will be angry’ — but it also makes it harder for both sides to dispassionately find common ground,” Kennedy added.
The world’s two largest economies have been embroiled in a trade dispute for more than a year. While Trump has focused on the U.S. trade deficit with China, issues include complaints that Beijing has fostered an uneven playing field with the alleged forced transfer of technology and a lack of intellectual property protections.
The two sides appeared close to a deal, until Trump tweeted on Sunday, May 5, Washington time, that tariffs on $200 billion worth of goods imported from China would increase to 25% from 10% that coming Friday. He cited a lack of progress on trade talks, and also threatened 25% tariffs on an additional $325 billion worth of Chinese goods would come “shortly.”
Official Chinese channels were quiet on the development for more than 24 hours until the Ministry of Foreign Affairs held its regular press conference, typically daily at 3 p.m. Beijing time, or 3 a.m. ET, during the work week. Spokesman Geng Shuang said the Chinese delegation was still preparing to travel to the U.S. for consultations on trade, but would not give any details.
When pressed by reporters, Geng said multiple times that they should contact the relevant department, which he did not specify by name.
“The relevant authority, naturally, is the one relevant to the issue. That’s why I will need to refer you to them,” he said, according to an official English-language transcript. A video clip of his non-answer was widely shared on Chinese social media. The Ministry of Commerce did not respond to requests from CNBC and other foreign news outlets for comment.
Only in the next several days did the Commerce Ministry release online statements, one confirming chief trade negotiator Liu He’s travels to the U.S. and another warning of “necessary countermeasures” if the Trump administration raised tariffs. At the ministry’s packed weekly press conference that Thursday, May 9, spokesman Gao Feng said China was prepared to respond to all kinds of outcomes on trade.
Liu He’s Washington visit ended about a day later with only the public acknowledgement that talks would continue. In remarks to Chinese state broadcaster CCTV, Liu emphasized the growth of the Chinese economy and the confidence of the people.
And, as Trump previewed, the U.S. raised tariffs on $200 billion worth of Chinese goods last Friday. When asked Monday afternoon in Beijing what China’s response would be, Ministry of Foreign Affairs spokesperson Geng referred reporters to the Commerce Ministry’s statement and said he would echo a phrase from the U.S. side and “wait and see.”
That night, CCTV’s 7 p.m. prime time news roundup featured a strong statement from announcer Kang Hui that lasted for about a minute and a half.
“Regarding the trade war instigated by the U.S. side, China made its attitude clear early on: Unwilling to fight, but not afraid to fight; must fight when necessary,” he said in Mandarin, according to a CNBC translation. “(If the U.S. wants to) talk, our door is wide open; (if the U.S. wants to fight), we will accompany to the end. Having experienced more than 5,000 years of disturbances, what kind of battle formation have the Chinese people not seen?”
A few hours later, the Ministry of Finance published four lists of U.S. goods set for tariffs ranging from 5% to 25%. The total targeted amount of imports is $60 billion, far less than what the U.S. duties cover, and aren’t set to take effect until June 1. The finance ministry also released a plan for applying for tariff exemptions.
A video of CCTV’s Kang went viral on Chinese social media and state-run outlets ran articles highlighting the popularity of the clip. As of Thursday morning Beijing time, a post on Weibo, China’s version of Twitter, showed the video had more than 99 million views.
People’s Daily, the official newspaper of the Chinese Communist Party, also released on Tuesday a morale-boosting graphic that called any attempts to bully China “wishful thinking.”
Other articles emphasizing China’s confidence and ability to stand up to the U.S. on trade have run in the last few days in Xinhua, the state-run news agency; and Global Times, the country’s state-owned tabloid.
Andy Mok, non-resident fellow at Beijing-based think tank Center for China and Globalization, pointed to a sentiment that Beijing is trying to emphasize the U.S. is powerless to make the Asian country act against its own interests. “This very clear stance by China is what they need to have the psychological breakthrough,” he said.
“The Chinese side has been very disciplined, ” he said. “After some internal consultation process this is how and when (they’re) going to respond.”
Governments must invest more in clean water: CEO
An Indian child carries an empty water bucket at Shakar Pada village, on the outskirts of Mumbai, on June 10, 2019.
Punit Paranjpe | AFP | Getty Images
Governments need to do more to invest in clean water, the chief executive of a non-profit organization urged, with unsafe drinking water posing a risk to populations.
More investment will also lead to economic advantages, pointed out Scott Harrison, chief executive officer and founder at charity: water.
“We’re arguing for higher government spending on water because it provides health, better education, more income,” he said Tuesday.
“You talk about bang for buck, water is a great way to get that,” Harrison added.
Improved access to clean water means people are less likely to fall ill from water-transmitted diseases, like diarrhea.
In 2019, the World Health Organization (WHO) estimated that unsafe drinking water contributes to 485,000 deaths from diarrhea each year. Diarrhea is the most common disease associated with contaminated food and water.
These health benefits extend to personal livelihoods and children’s education as well.
With access to safe and clean water, people spend less on medical bills and can stay in employment for longer periods, said the WHO.
Nearly 570 million children worldwide have limited or no access to drinking water in their schools, according to a 2018 report by the United Nations Children’s Fund and the WHO. That translates to 19% of schools worldwide.
Children may not perform “at their very best” if they are not properly hydrated in school, Rick Johnston, the World Health Organization’s technical officer, told Global Citizen in 2018.
Given these benefits, it seems natural for governments to invest in clean water, in order to reap more economic and social advantages. However, this isn’t always the case, Harrison notes.
“We’re seeing a lot of governments certainly not doing enough, not spending enough money on water. It’s so frustrating for us sometimes,” said Harrison.
So his charity is plugging this gap by bringing clean drinking water to developing nations.
Since 2006, charity: water has brought clean water to approximately 9.6 million people across 27 countries, using 13 different types of technology. That’s because there’s no “one size fits all solution to the water crisis,” Harrison said.
While 90% of the world’s population had access to a basic drinking water source in 2017, 785 million people still lack this basic facility. Worldwide, 144 million people are still dependent on surface water, which can be easily polluted by hazardous substances, according to WHO statistics.
How the Chinese yuan might perform in US-China trade war
U.S. banknotes and Chinese yuan notes.
Paul Yeung | Bloomberg | Getty Images
The yuan depreciated past 7 per dollar last week for the first time since the global financial crisis of 2008, which prompted the U.S. Treasury Department to designate China as a currency manipulator.
In a recent report, the Bank of America (BofA) Merrill Lynch Global Research predicts what might happen to the Chinese yuan in three scenarios.
Scenario 1: A full blown trade war — the yuan depreciates 10%.
Chinese imports from the U.S. are only a third of American imports from China, the bank pointed out. This means that China cannot match the U.S. tariffs in terms of quantity. However, one thing Beijing can do is to devalue the yuan by 10%, canceling off the impact of a 10% tariff on Chinese goods, BofA Merrill Lynch Global Research analysts said.
Scenario 2: A drawn out impasse — the yuan remains “unchanged.”
“In a protracted impasse, RMB is likely to remain range bound, only because Beijing would be wary of both angering the US by allowing the RMB to weaken or adding even more headwinds facing Chinese exporters by allowing the RMB to strengthen,” the bank said, referring to the yuan’s other name, the renminbi.
Scenario 3: An imminent trade deal: The yuan appreciates “modestly.”
In this situation, the value of the yuan will go up but will be limited.
This is because “any deal is likely to include stipulation that would limit the room for any future RMB depreciation,” the bank explained. “If Beijing feels that the downside for the RMB is limited, it is likely to want to limit the upside for the RMB, especially if it thinks any RMB appreciation becomes difficult to reverse politically.”
Winners and losers in Asia
Weakness in the yuan “essentially puts the brakes on” other currencies in the region, including the Indian rupee, Singapore dollar, Korean won, Malaysian ringgit and Indonesian rupiah, said Jameel Ahmad, global head of currency strategy and market research at FXTM.
Amid the trade war, the Korean won looks likely to be among the biggest losers as it “has been the most preferred expression of deterioration in trade tensions,” wrote BofA Merrill Lynch Global Research analysts in a recent note.
South Korean trade is heavily dependent on China and the U.S., as the country is closely interlinked in the supply chains between the two giants. The won has also been hit by the dispute with Japan, which has spilled into trade between the two Asian neighbors.
The most resilient currency among emerging markets in Asia is the Thai baht, the BofA Merrill Lynch analysts wrote.
Despite attempts by Thailand’s central bank to weaken it, the baht has steadily strengthened — supported by the country’s large trade surplus, among other factors.
U.S.-China trade tensions have also affected economies elsewhere, and coupled with slowing growth globally, it is encouraging countries to lean toward weaker currencies, Ahmad warned.
“From many perspectives it makes sense to prefer a cheap currency during uncertain times,” Ahmad told CNBC in an email. “There is a global downturn taking place, and demand for goods (or) services is at risk to weakness due to declining investment confidence, with this encouraging the preference to have a cheap currency to boost export competitiveness.”
A weaker currency makes a country’s exports cheaper, causing them to be more attractive in international markets.
Australian tourist shot dead in New Zealand, manhunt launched
A Canadian woman who had been travelling with the victim, a 33-year-old man, escaped from the van after the attacker drove off in it, police said.
The attack on the two tourists occurred at around 3.20 a.m. in Raglan, a coastal town in the Waikato region of New Zealand’s North Island. Police found the vehicle, with the dead body inside, at 8 a.m., a few kilometers away.
Police did not release the name of the victim.
New Zealand is a popular tourist destination, especially among Australians. Last year, a 22-year old British woman was killed while on a backpacking tour of the country.
World1 week ago
How bonds with negative yields work and why this is so bad
Politics1 week ago
‘Green shirt guy’ goes viral over reaction to ‘sanctuary city’ heckler
World4 days ago
China central bank close to releasing digital currency: PBOC official
World6 days ago
Trump says Kim will stop missile tests when US-South Korean drills end
Politics5 days ago
Queen could scupper Sajid Javid’s plan to fill tills with Brexit 50p coins
World4 days ago
South Korea to drop Japan from its preferential trade ‘white list’
Politics3 days ago
Carrie Symonds all smiles with Boris Johnson as she's pictured inside No10 for first time
Politics3 days ago
Acting ICE chief defends Mississippi raids that left children abandoned, blames parents