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By PHELIM KINE
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Hi, China Watchers. Today we decode the outcome of the meeting between President Joe Biden and Chinese leader Xi Jinping's meeting in San Francisco yesterday and explore the controversy over Xi's top dollar business banquet. We'll also check in on Beijing's "socialist modernization" of Tibet and profile a book that warns that the U.S. government is ignoring Chinese-backed hacker penetration of "thousands of American computing systems."
Let's get to it. — Phelim
Programming note! China Watcher won't publish next Thursday, Nov. 23 due to the U.S. Thanksgiving holiday.
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Joe Biden and Xi Jinping talk during an expanded bilateral meeting in the Roosevelt Room at the White House on February 14, 2012 | Chip Somodevilla/Getty Images |
Biden and Xi — A day of diplomacy and a few seconds of honesty
President Joe Biden walked out of a four-hour meeting with Chinese leader Xi Jinping yesterday afternoon and labeled the discussions "constructive and productive." He ended the night calling Xi a "dictator."
The off-the-cuff remark to reporters echoed a comment he made about Xi in June – and one that Beijing at the time called "provocative."
While the comment could trigger Chinese backlash, Biden did come out of the meeting touting success in persuading Xi to work together to stem the flow of fentanyl, renew high-level military talks and begin discussions on governing the use of artificial intelligence. But neither leader appeared to budge on one of the key fault lines in the U.S.-China relationship —Taiwan's status. Xi demanded that the U.S. "stop arming Taiwan," Xinhua reported. He also declared that the self-governing island's "reunification" with China — something the majority of Taiwanese oppose — is "unstoppable." POLITICO's Christopher Cadelago, Gavin Bade, Jonathan Lemire and I have the full story here.
Here’s a breakdown of the measurable progress in the U.S. relationship over the past two days.
Fentanyl/Counternarcotics
Biden's biggest win for his domestic audience was persuading Xi to help address China's role in the U.S. opioid overdose epidemic. Chinese chemical firms ship precursor chemicals to Mexico where cartels process them into fentanyl-like compounds that end up on the streets of U.S. cities, killing tens of thousands of Americans every year. Beijing suspended counternarcotics cooperation as a reprisal for then-House Speaker Nancy Pelosi's Taiwan trip in 2022.
While Biden mentioned "action to significantly reduce" the flow of chemicals, the Chinese summary referred only to the creation of a working group.That may be enough. "If such an agreement is honored and enforced by both parties, I'm optimistic that we'd see a substantial decrease in the trafficking of illicit fentanyl precursors between China and Mexico," said Rep. David Trone (D-Md.), co-chair of Biden's Commission on Combating Synthetic Opioid Trafficking.
Military-to-military ties
The meeting also led to the renewal of high level military-to-military talks that Beijing suspended in August 2022. That suspension had fanned fears at the Pentagon that potential accidents between U.S. and Chinese military aircraft or vessels in the Indo-Pacific could spiral into crisis situations. Those concerns have risen due to the sharp increase in what the Pentagon calls "coercive and risky" interceptions of U.S. aircraft and vessels by Chinese forces in the South China Sea. "We're resuming military to military contact direct contacts —that’s been cut off and it’s been very worrisome [because] that’s how accidents happen," Biden said. The resumption of contacts will allow Defense Secretary Lloyd Austin "to meet with his Chinese counterpart when that person is named," a senior administration official told reporters prior to Biden's press briefing. Former Chinese Defense Minister Li Shangfu, dismissed from his post last month, declined multiple meeting requests from Austin.
But there's no guarantee that the resumption will change risky behavior by Chinese forces in the region. "It's not a silver bullet," said Kristen Gunness, former director of the Navy Asia Pacific Advisory Group at the Pentagon and now a researcher at Rand Corporation. The onus is now on Beijing to "take meaningful steps to reduce the risk of crisis and accidents and talk about overall strategic stability," she said.
Artificial intelligence
Biden and Xi agreed to convene experts "to discuss risk and safety issues associated with artificial intelligence… tangible steps in the right direction to determine what’s useful and what’s not useful, what's dangerous and what’s acceptable," Biden said. That agreement comes in the wake of an FBI warning in June that China is "stealing our AI technology and data to advance their own AI programs and enable foreign influence campaigns" and may help cool tensions.
Climate
Biden and Xi began their meeting with a mutual win under their belts. Hours before they sat down together, Biden's climate envoy John Kerry announced that he and his Chinese counterpart, Xie Zhenhua, had hammered out a roadmap for U.S.-China collaboration in the run-up to the United Nations climate talks in Dubai this month. That includes a groundbreaking mutual commitment to curb all greenhouse gasses.
That agreement might have a positive knock-on effect. "Carefully negotiated language between China and the United States often makes its way into the multilateral [climate] agreements…hopefully all developing countries might agree to similar language," said Joanna Lewis, an associate professor at Georgetown University and an expert on China's climate policies.
TRANSLATING WASHINGTON
— GALLAGHER BLASTS XI'S BANQUET BUDS: Rep. Mike Gallagher (R-Wis.) slammed the organizers and attendees of last nights' exclusive corporate dinner for Xi in San Francisco. "It is unconscionable that American companies might pay thousands of dollars to join a 'welcome dinner' hosted by the very same Chinese Communist Party officials who have facilitated a genocide against millions of innocent men, women, and children in Xinjiang," Gallagher, chair of the House Select Committee on China, said in a statement.
Prices per plate ranged from $2,000 for the cheaper seats to $40,000 for a spot at Xi's table, per the New York Times. Gallagher also questioned the judgement of the dinner's co-organizers, the National Committee on U.S.-China Relations and the U.S.-China Business Council for seeking "profit from selling access to the senior-most CCP official responsible for the Uyghur genocide." Gallagher is demanding that NCUSCR president Stephen Orlins and USCBC president Craig Allen provide "a complete list of individuals, companies, financial institutions, and other entities" that bought tickets for the event. Allen welcomes an opportunity to brief Gallagher's committee on "the longstanding tradition of hosting the president of China and representatives from the U.S. government to further support and encourage constructive dialogue between the two countries," USCBC said in a statement. The NCUSCR didn't respond to a request for comment.
— AUSTIN:BEIJING BUSTING NORTH KOREAN SANCTIONS: Defense Secretary Lloyd Austin condemned Beijing and Moscow for undermining international sanctions aimed to obstruct North Korea's missile development program. "We are deeply concerned that the PRC and Russia are helping the DPRK expand its capabilities by enabling it to evade sanctions from the U.N. Security Council," Austin said in a speech to the Korea-United Nations Command Member States Defense Ministerial Meeting in Seoul on Tuesday. Beijing took issue with the venue for Austin's comments rather than the comments themselves. "The so-called 'UN Command' is the product of the Cold War, has no legal grounds, and has long been outdated … [and] stokes confrontation and creates tensions," Chinese Foreign Ministry spokesperson Mao Ning said.
— INDONESIA-US TIGHTEN DEFENSE TIES: Visiting Indonesian President Joko Widodo's meeting with Biden on Monday reaped a series of agreements cementing defense ties. They included cybersecurity and maritime security agreements as well as the announcement of a new Defense Cooperation Arrangement. That deal "broadens and deepens cooperation in defense professionalization" in areas including joint military exercises, said a White House statement. The agreements reflect Biden administration efforts to counter China's diplomatic inroads in Indonesia through trade as well as infrastructure development brokered through China's Belt and Road Initiative.
TRANSLATING EUROPE
EU PLAYS NICE ON SANCTIONS AHEAD OF CHINA SUMMIT: The European Union plans to leave several Chinese companies out of a proposed package of sanctions against Russia, according to a draft seen by POLITICO. It comes as European Commission President Ursula von der Leyen and Charles Michel, her European Council counterpart, confirm plans to travel to Beijing on Dec. 7 for the first in-person EU-China dialogue in four years.
Brussels excluded four Chinese companies from the initial plan, according to the draft: Sinno Electronics, 3HC Semiconductors, Sigma Technology and King-Pai Technology. The EU already took action against three Hong Kong-based companies, in response to allegedly circumventing EU sanctions against Russia. EU countries' top representatives in Brussels are set to discuss the package on Friday, two EU diplomats said. Barbara Moens, Jacopo Barigazzi and Camille Gijs have the story.
TOP GERMAN FUND MANAGER QUESTIONS COMPANIES' MOVE TO CHINA: Union Investment, the second largest fund manager in Germany, criticized German firms for making the "risky" decision to increasingly relocate research and other business to China. "No other country, not even China's direct neighbors such as Japan and South Korea, has so many large companies with high exposure to China," it said. Reuters has the scoop.
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HOT FROM THE CHINA WATCHERSPHERE
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— TAIWAN OPPOSITION PRESIDENTIAL CANDIDATES UNITE: The two leading opposition party challengers in Taiwan's Jan. 13 presidential election have formed a joint ticket to try to defeat the current leading candidate, Lai Ching-te. The presidential candidate for Taiwan's opposition KMT, or Nationalist party, Hou You-yi, and Taiwan People's Party candidate Ko Wen-je agreed to a joint electoral run on Wednesday, without announcing how they would assign the presidential and vice presidential roles, per Al Jazeera. Lai has been leading polls with around 30 percent of voters, compared to around 20 percent each for Hou and Ko.
The Hou-Ko ticket could derail Lai's presidential ambitions and result in a Taiwan administration that may end the current dialogue deadlock with Beijing. A Hou-Ko victory "would raise questions about how confrontational policy should be between Taiwan and the [Chinese] mainland, which could further complicate U.S. policy," since the two are not pushing independence and could get a warmer reception from Beijing, said Douglas Paal, who was director of the U.S. unofficial diplomatic outpost in Taiwan under President George W. Bush.
— REPORT: DON'T TRUST THE 'COOPERATION' DRIVE: Beijing's recent efforts to curb rancor from the U.S. and the EU are "mostly in the realm of rhetoric and abstract ideas rather than concrete action," the U.S.-China Economic and Security Review Commission said on Tuesday in its 2023 annual report. The report recommends the U.S. and EU place "economic sanctions on China in the event of a confrontation over Taiwan, an escalation in China's support for Russia, or other contingencies."
**To mark the launch of POLITICO PRO Defense, we're giving you a live taste of our experts' coverage at the POLITICO Live Defense Launch event on November 21. Get ready for an exciting joint interview, panel discussion and networking cocktail reception. Last chance to apply for onsite attendance! **
TRANSLATING CHINA
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The Dalai Lama looks on during his Buddhist blessing | Kristian Dowling/Getty Images |
— BEIJING TOUTS TIBET 'ACHIEVEMENTS': The Chinese government released a document titled "Policies on the Governance of Xizang in the New Era: Approach and Achievements" last week to update us on how great things are going in Tibet. It's a dense 13,000 words that unpacks Beijing's policies aimed to ensure "lasting stability and … socialist modernization" in the region that Beijing now refers to in English as "Xizang." That's the pinyin, or transliteration of the Chinese term for the restive western region seared by decades of severe human rights abuses.
We dug into those policies with Namgyal Choedup, the Washington-based North American representative of the exiled Central Tibetan Administration. Here are key takeaways:
It's a response to U.S. criticism. The document partially reflects a delayed response to the State Department's visa restrictions in August on Chinese officials linked to "forcible assimilation of more than one million Tibetan children in government-run boarding schools." "China knows it lacks historical and popular legitimacy inside Tibet, so it's trying to gain legitimacy from the international community," said Choedup.
It channels China's fears about India. The document declares that "stability in Xizang is paramount in the governance of the border areas and the country as a whole." That's a stealth reference to the fact that Tibet shares a slice of the 2,100 miles of China's increasingly fraught border with India. Tensions over sections of the disputed border area have boiled over into pitched battles between brick and club-wielding Chinese and Indian troops.
It's about the next Dalai Lama. "Adapt religion to China's realities and handle religious affairs in accordance with the law" is one of the Chinese Communist Party's Tibet governance guidelines. That reflects the centrality of Buddhism in the lives of Tibetans and their reverence for their exiled spiritual leader, the Dalai Lama, which Chinese authorities have demonized as a "wolf in monk's robes" and criminalized possession of his photo. China's Tibet policies require that "reincarnated Tibetan living Buddhas, including Dalai Lamas … receive approval from the central government," the document said. The CCP wants to make Tibetan Buddhism "loyal to the state, so they have a game plan of making sure that the next Dalai Lama is someone that they can choose," Choedup said.
**POLITICO's Global Playbook takes you behind the scenes at COP. As part of the major global events that shape international policy, our newsletter delivers daily reporting on green policy shifts taking place at COP28. Want to get them in your inbox? Sign up here.**
HEADLINES
CNBC: Why China should stop using pandas as adorable political pawns
Foreign Affairs: China's misunderstood nuclear expansion
The Wall Street Journal: Surge and swarm: How China's ships control the South China Sea
ONE BOOK, THREE QUESTIONS
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JPrzemyslaw Klos/EyeEm/iStock/Getty Images Plus and Peter Dazeley/iStock/Getty Images and Enterline Design Services. |
The Book: Battlefield Cyber: How China and Russia are Undermining our Democracy and National Security
The Authors: Michael G. McLaughlin is co-chair of the Cybersecurity and Data Privacy Practice Group at the Buchanan Ingersoll & Rooney PC law firm; William J. Holstein is an author, journalist and consultant.
Responses have been edited for length and clarity.
What is the most important takeaway from your book?
America has suffered a systemic breakdown in the way it manages its computing and Internet systems, including social media. China and Russia are exploiting this to their advantage by channeling disinformation into those systems, contributing to our polarization and loss of confidence in our institutions. The U.S. government has not prepared itself for this cyber era and is not organized to deliver an effective response. The private sector also has failed to safeguard its data and its information technology systems, leaving many networks open to penetration. The gap in cooperation between the government and private sector is at the heart of why America has not been able to respond effectively to these threats.
What was the most surprising thing you learned while writing this book?
China and Russia have achieved deep and active penetration of thousands of American computing systems. It is not a situation where they attack and they then disappear. Particularly in the case of network penetration by Chinese state-backed hackers, they can hide in large corporate systems, even those that rely on cloud computing, for several years, carefully waiting and watching what target companies are doing and stealing secrets. Their presence is pervasive.
What does your book tell us about the trajectory and future of U.S.-China relations?
We can either accept a form of de facto colonization created by Chinese manipulation of our computing and Internet systems. Or we can seek to re-establish a balance by reorganizing our government for the digital era. We need a Department of Digital Services and we need to find new ways to cooperate across the public/private sector divide to safeguard our critical infrastructure and the 300,000 companies in the defense industrial base.
Got a book to recommend? Tell me about it at pkine@politico.com.
Thanks to: Jessica Meyers, Christopher Cadelago, Gavin Bade, Jonathan Lemire, Barbara Moens, Jacopo Barigazzi, Camille Gijs and digital producers Tara Gnewikow and XXXX. Do you have tips? Chinese-language stories we might have missed? Would you like to contribute to China Watcher or comment on this week's items? Email us at pkine@politico.com and slau@politico.com.
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