 |
By STUART LAU
with PHELIM KINE
Send tips here | Tweet @StuartKLau or @PhelimKine | Subscribe for free | View in your browser
WELCOME TO CHINA WATCHER! This is Stuart Lau filing from Europe’s biggest summer ghost town, Brussels. Phelim Kine will be with you from Washington on Thursday.
FIRST, A FRESH ROCKET FROM THE CHIEF: China has indirectly confirmed rumors about scandals engulfing an immensely strategic unit of the People’s Liberation Army. On Monday, President and Commander-in-Chief Xi Jinping announced a reshuffle of the top leadership of the PLA Rocket Force, which deals with China’s expanding nuclear arsenal, deployment of intercontinental ballistic missiles, and Taiwan war planning. Wang Houbin, a navy veteran, has been parachuted into the Rocket Force as the new commander, taking over from Li Yuchao who’s been detained for a corruption probe according to the South China Morning Post. Concurrently Xi also replaced the “political commissar” for the Rocket Force, with Xu Xisheng from the air force now the Party’s point man in exercising political control over the scandal-hit force. The new appointments were made just a day before the highly symbolic PLA Day today.
FOR ROME, ALEA IACTA EST
BELT AND ROAD, DAYS NUMBERED: Italian Prime Minister Giorgia Meloni‘s government confirmed for the first time this week that it’s seeking a way out of its four-year-old membership of China’s Belt and Road Initiative. The confirmation comes in the form of a newspaper interview with Italian Defense Minister Guido Crosetto, shortly after Meloni’s meeting with U.S. President Joe Biden in the White House.
What did he say 1: “The choice to join the Silk Road was an improvised and wicked act, made by the government of Giuseppe Conte, which led to a double negative result,” said Crosetto in the interview with Corriere della Sera newspaper, invoking the Roman(ticized) name of the multibillion-yuan Chinese scheme to build global infrastructures. “We exported a load of oranges to China, they tripled exports to Italy in three years.”
What did he say 2: In the same interview Crosetto, who’s one of the harshest critics of China in the Italian government, also lashed out at Beijing’s “increasingly assertive attitude.”
“It once set out to become the world’s largest trading player. Today it … will be the largest military actor in the world. They are expanding.”
BACK TO MELONI’S DC TRIP: The Italian leader, whose right-wing credentials and anti-LGBTQ+ attitude have sparked wide antipathy in Europe, is nonetheless fiercely tough on Russia. For Washington, she’s the best hope to make Italy abandon its status as the only G-7 member of the Belt and Road Initiative.
Still, she didn’t drop many hints: According to two Italian diplomats with knowledge of her trip, Meloni did reassure Biden that the plan would be to leave when the memorandum is up for a renewal early next year — but she’s trying to do it in a “diplomatic” way so that Beijing would not feel too offended and overreact. Indeed, while in Washington, Meloni said she’s planning to visit Beijing in a bid to seek a one-on-one meeting with Xi.
In the joint statement: Biden and Meloni would only say that the two countries “commit to strengthen bilateral and multilateral consultations on the opportunities and challenges posed by the People's Republic of China.” It added: “The United States welcomes the increased presence of Italy in the [Indo-Pacific] region. The two sides reiterate the vital importance of maintaining peace and stability across the Taiwan Strait, which is instrumental to regional and global security and prosperity.”
TYRE DISPUTES: Pirelli investors on Monday approved a new board for the tyremaker, giving it a new three-year governance set-up after the Italian government last month took steps to curb the influence of the company’s leading Chinese investor. Reuters has the story.
CHINA DEEPENS SOUTH CAUCUSUS TIES
NEW BESTIE GEORGIA: China is having more luck with Georgia than Giorgia, as it announced an upgrade of bilateral ties to a strategic partnership with the South Caucasus country, according to a joint statement. This came after Georgian Prime Minister Irakli Garibashvili visited Chengdu as the only European guest invited to the opening ceremony of World University Games alongside Xi.
Blow to the EU: Georgia has been in a difficult relationship with the EU lately, as its treatment of jailed former President Mikheil Saakashvili, who’s also a close ally of Ukrainian President Volodymyr Zelenskyy, has drawn wide criticism.
China eyes connectivity: The joint statement affirms Georgia’s commitment to Belt and Road, saying that the two countries have signed a bilateral cooperation plan to promote “sustainable development.” Beijing also vowed to strengthen the “Middle Corridor” (a Eurasian connectivity concept bypassing Russia) and the “usage of Georgia’s transit infrastructure for smooth export of Chinese products to Western markets.”
Build build build: China also promised to “study” the provisions of preferential loans for Georgia’s infrastructure projects, according to the statement. Apart from Xi, Garibashvili also met with Jin Liqun, head of the Asia Infrastructure Investment Bank, China’s answer to the U.S.-led World Bank, as well as top management of Huawei.
FRANCE’S DOUBLE ACT
SLAMMING [REDACTED] IN THE PACIFIC: In his trip to the Pacific, French President Emmanuel Macron denounced a "new imperialism" in the Indo-Pacific on Thursday as he pledged France would boost its presence in the region to defend the sovereignty of smaller states.
He stopped short of naming the countries he accused of this "new imperialism" in a region where China is leading an increasingly offensive foreign policy, and the U.S. is also scaling up its presence. "In the Indo-Pacific, and particularly in Oceania, a new imperialism is appearing, and a power logic that is threatening the sovereignty of several states, the smallest, often the most fragile," he said in a speech in Vanuatu.
So long, Macron: The visit, the first by a French president since Charles de Gaulle toured the region in 1966, is meant to mark France's "re-involvement" in the Indo-Pacific, which had been upset by France's exclusion from the AUKUS alliance in 2021. France has ambitions of standing "shoulder to shoulder" with countries in the Pacific to support "their independence and sovereignty," Macron said. Clea Caulcutt has the story.
FINANCE MINISTER GETS DEALS IN BEIJING: Just as the president was sounding harsh on unnamed Pacific hegemonies, France’s Finance Minister Bruno Le Maire visited Beijing this week for the high-level economic dialogue with his Chinese counterpart, Vice-Premier He Lifeng. Le Maire went to great lengths to reassure Beijing, saying: “De-risking does not mean that China is a risk. De-risking means that we want to be more independent.”
Big winner 1 — BNP Paribas: There’s more market access for the French bank, which won multiple mentions in a “joint fact-sheet” after the meeting. “As capital markets and the field of wealth management is of increasing importance, both sides welcome the establishment of a fully owned securities firm by an eligible French bank in China. In parallel, China and France support the application of BNP Paribas to the Securities Investment Fund Custody license,” it said, adding that a new joint venture partly run by the bank is now in operation.
Big winner 2 — Huawei: In a new conference after the talks, the Chinese vice-premier — a close ally to Xi — said the Chinese side appreciated France’s decision to extend Huawei 5G licenses in some cities. A spokesperson for Le Maire confirmed this was “the result of the current legal process: licenses and their extensions are granted according to a technical instruction. Under this framework, licenses have indeed been granted and/or extended in various départements in France.”
Outstanding issues: France is seeking greater market access for its cosmetic brands in China, while ongoing debt relief talks for African countries remain a top item on Paris’ agenda with Beijing.
INDO-PACIFIC CORNER
EU CHIEF IN MANILA: European Commission chief Ursula von der Leyen used a speech in Manila on Monday to take aim at China, slamming Beijing for its increasingly militant stance in the Indo-Pacific and its failure to live up to international responsibilities on Ukraine.
Delivering a keynote speech at the Philippines Business Forum, von der Leyen said that China, a permanent member of the U.N. Security Council, "has yet to assume fully its responsibility under the U.N. Charter to uphold the sovereignty and territorial integrity of Ukraine."
Tough warning: Von der Leyen, now considered one of the toughest critics of China within the EU bubble, warned that China's show of military force in the South and East China Seas, and in the Taiwan Strait, may have "global repercussions," noting that the EU has been enhancing its engagement in the Indo-Pacific. Suzanne Lynch has the details.
NEW ZEALAND NIXES BLINKEN'S AUKUS OVERTURE: Secretary of State Antony Blinken got pushback last week on his offer to New Zealand of possible future membership in AUKUS, a trilateral grouping under which the U.S. and the U.K. will help Australia acquire nuclear-powered submarines in a bid to counter China's growing naval power. "The door is very much open to New Zealand" to join AUKUS, Blinken told reporters in Wellington last week. New Zealand Foreign Minister Nanaia Mahuta responded in that press conference by telling Blinken that Wellington "is not prepared to compromise or change our nuclear framework position." Mahuta took a tougher line in a separate press briefing later asserting that New Zealand is "not contemplating joining AUKUS … It’s a club we’d have to sell our soul to join."
AUSTIN FLAYS BEIJING'S INDO-PACIFIC 'BULLYING': Defense Secretary Lloyd Austin shared strong words about China's conduct in the Indo-Pacific while meeting with Australian Deputy Prime Minister Richard Marles. Beijing is guilty of "troubling coercion from the East China Sea to the South China Sea to right here in the Southwest Pacific and we’ll continue to support our allies and partners as they defend themselves from bullying behavior," Austin said on Friday.
TRANSLATING WASHINGTON
TAIWAN GETS $345 MILLION ARMS PACKAGE: The Biden administration announced a $345 million weapons package for Taiwan on Friday, the first tranche in a total of $1 billion the U.S. has allotted to be transferred directly from Pentagon stockpiles to the island this year. The package marks the first time the U.S. has used new authority from Congress to transfer military equipment directly from Pentagon inventory to Taiwan. The transfer is done under the Presidential Drawdown Authority, the same mechanism Washington uses to send weapons to Ukraine. POLITICO'S Lara Seligman has the full story here.
— The deal reaped bipartisan praise on Capitol Hill. ""I am glad to see the Biden administration send this much-needed weapons package to Taiwan as Communist China eyes further aggression," said Michael McCaul (R-Texas), chair of the House Foreign Affairs Committee, in a statement on Friday. Raja Krishnamoorthi (D-Ill.), ranking member of the House Select Committee on China, said the arms sale is "welcome news for those of us aiming to strengthen stability and security in the Indo-Pacific." Beijing was not pleased. "No matter how much tax money [Taiwan's government] and the separatist forces for 'Taiwan independence' spend on the people of Taiwan and how many U.S. weapons they buy, they will not be able to shake our firm will to resolve the Taiwan issue and realize the complete reunification of the motherland," Chen Binhua, spokesperson of China's Taiwan Affairs Office, said in a statement on Saturday.
BEIJING BLASTS HK LEADER APEC BAN: Beijing responded sharply to a media report that the U.S. government will bar Hong Kong Chief Executive, John Lee, from attending the APEC summit in San Francisco in November. Banning Lee's attendance is "a bullying act which seriously violates the basic international norms," Chinese Foreign Ministry spokesperson Mao Ning said on Friday. White House spokesperson Karine Jean-Pierre responded on Friday to questions about Lee's reported exclusion from APEC by saying that invitations would be "in accordance with U.S. laws and regulations," a line echoed that same day by National Security Council spokesperson John Kirby. Lee is the territory's former security chief who oversaw brutal police responses to the city's pro-democracy protests in 2019. His implementation of the draconian National Security Law introduced in June 2020 which criminalizes peaceful protest prompted the U.S. Treasury Department to place him on a sanctions list in 2020.
KERRY QUIET ON CLIMATE TALKS FOLLOW-UP: President Biden's climate envoy John Kerry had a video call last week with his Chinese counterpart Xie Zhenhua, the first of a promised series of follow-ups to Kerry's Beijing trip last month. But Kerry's office hasn't responded to requests for comment about the call and Kerry has shared nothing about it via his account on X, formerly known as Twitter. Beijing has been slightly more forthcoming. Kerry and Xie "exchanged views on strengthening China-U.S. dialogue and joining hands to promote global multilateral climate process…[and] agreed to continue to maintain close communication,” Chinese state media reported on Friday.
OTHER HEADLINES
Associated Press: Our bears are real, a Chinese zoo says, denying they are 'humans in disguise'
Financial Times: China accused of using 'wrecking tactics' at climate talks
New York Times: Volkswagen seeks to regain edge in China as it cuts delivery forecast
Reuters: Hong Kong removes requirement to flag China risk in listing applications
SCMP: China boosts its Project GW satellite rival to compete with Elon Musk's Starlink
MANY THANKS TO: My editor Christian Oliver, reporters Suzanne Lynch, Clea Caulcutt, Giorgio Leali, Varg Folkman, Lara Seligman and producer Ellen Boonen.
SUBSCRIBE to the POLITICO newsletter family: Brussels Playbook | London Playbook | London Playbook PM | Playbook Paris | POLITICO Confidential | Sunday Crunch | EU Influence | London Influence | Digital Bridge | China Watcher | Berlin Bulletin | D.C. Playbook | D.C. Influence | Global Insider | All our POLITICO Pro policy morning newsletters
This email was sent to salenamartine360.news1@blogger.com
Unsubscribe from this newsletter, or
unsubscribe from all POLITICO SRL emails
POLITICO SRL · Rue de la Loi 62 · Brussels 1040 · Belgium
|