July 10, 2023

Meanwhile in China…

From espionage law to trade dispute to Yellen’s visit, an update on our icy relations with the ChiComs.

Much happened on the foreign affairs front last week with China, which predictably is getting more aggressive — and it seems Team Biden is content to continue trying to appease.

The first item on the docket is a new espionage law. According to The Guardian: “The US National Counterintelligence and Security Center (NCSC) said the law … gives Beijing ‘expanded legal grounds for accessing and controlling data held by US firms in China’. The NCSC said the new law is ambiguous on what fits its definition of national security secrets, but believes Beijing’s view could include information that companies use as a normal part of their business.” This law would allow the Chinese Communist Party (CCP) to snoop on U.S. companies and is vague enough that the threat of being labeled as an “espionage” company (or individual) is a more palpable cudgel.

The penalty for the crime of espionage in China ranges from life in prison to execution. This law is a curious move on the CCP’s part. It would seem to discourage foreign companies from doing business with China, and Chinese citizens from working for those companies. Is China trying to isolate itself from the market? Perhaps. More likely, it is trying to posture and give the West a show of strength.

In any case, the law itself is beyond ironic given that so much of China’s technology and advancement is the result of intellectual property theft from other countries.

If tightening the espionage laws weren’t threatening enough, dictator Xi Jinping also decided to restrict exports on two minerals to the U.S.. These minerals are gallium and germanium. They are important materials used to construct solar panels, electric cars, and (more importantly) military equipment. This restriction was a retaliation from Xi for the U.S. blocking China from accessing advanced semiconductors.

This may be more shortsighted than productive for the CCP. By restricting the exports, it only encourages other countries in the West to increase production. However, if the aim is to mess up U.S. stockpiles of arms and ultimately access to semiconductors (Taiwan’s biggest export), it may send some sort of message if the restriction is there for the long term. As Wu Xinbo, dean of the Institute of International Studies at Shanghai’s Fudan University, put it, “China is creating more bargaining chips, in order to make the U.S. pay attention to its concerns.”

To end the week, Team Biden sent a new emissary to see if she would have any luck thawing relations with our biggest foreign enemy. Treasury Secretary Janet Yellen landed in Beijing on Thursday and, according to The Wall Street Journal, is overall a better-liked face in the Biden administration by the Chinese. Secretary of State Antony Blinken’s recent visit was an utter disaster. However, it’s hard to take these talks seriously when, strategically right before Yellen’s arrival, Xi instructed fighters in his Easter Theater Command (the one that patrols the Taiwan Straight) to be ready for war.

Talks will continue with Yellen and Chinese officials into Monday, and the goal — just as it was with Blinken’s visit — is to open up communications channels between the two countries. We shall see if Yellen is more successful where Blinken and others have failed.

As much as the Chinese may like Yellen better than others in the Biden administration, the fact is, signs are pointing to escalating aggression. Each new week seems to be accompanied with fresh acts of challenge by the Chinese.

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