Category: China

Xi’s Communist Assertion of Control of Private Firms Dulls the Entrepreneurial Innovation and “Unbridled Energy That Powered China’s Explosive Growth”

(p. A3) Just a few weeks later, Mr. Xi personally intervened to block the $34 billion initial public offering of one of China’s biggest private firms, Ant Group, partly out of concerns it was too focused on its own profits rather than the state’s goal of controlling financial risk.

The message isn’t lost on entrepreneurs, who are reorienting their businesses to appease the state or giving up on private enterprise altogether.

“For us small businesses, we have no choice but to follow the party,” says Li Jun, a 50-year-old owner of a fish-farming business in the eastern Jiangsu province. “Even so, we’re not benefiting at all from government policies.”

Mr. Li recently closed down a seafood-processing plant because it couldn’t get bank loans—a persistent problem for private firms, despite Beijing’s repeated pledges to make credit more available for them.

The risk for China is that Mr. Xi’s vigorous assertion of statist prerogatives will dull the kind of innovation, competitive spirit and unbridled energy that powered China’s explosive growth in recent decades. The economic policies that helped nurture e-commerce giant Alibaba Group Holding Ltd., tech conglomerate Tencent Holdings Ltd. and other global success stories seem to be at an end, say economists inside and outside China. As a result, they say, Chinese companies are becoming less like American ones, which are driven by market forces and depend on private innovation and consumption.

. . .

In one of the clearest signs of China’s direction, more state firms are gobbling up private companies, redefining a government initiative called “mixed-ownership reform.” The original idea, dating back to the late 1990s, was to encourage private capital to invest in state firms, bringing more private-sector acumen to China’s often-bloated state-owned enterprises.

Now, under Mr. Xi, the process often works the other way around, with big state companies absorbing smaller ones to keep them going, and reconfiguring the smaller firms’ strategies to serve the state.

For the full story, see:

Lingling Wei. “Xi Ramps Up Control of China’s Private Sector.” The Wall Street Journal (Friday, Dec. 11, 2020): A3.

(Note: ellipsis added.)

(Note: the online version of the story has the date December 10, 2020, and has the same title as the print version.)

Tim Cook’s Apple Is Silent on Communist China’s Suppression of Human Rights

(p. A19) Apple CEO Tim Cook has been taking a beating over his company’s coziness with Beijing. It comes amid protests across China against the government’s strict Covid-19 lockdowns, including at a factory in Zhengzhou where most of the world’s iPhones are made. Hillary Vaughn of Fox News perfectly captured Mr. Cook’s embarrassment on Capitol Hill Thursday [Dec. 1, 2022] when she peppered him with questions:

“Do you support the Chinese people’s right to protest? Do you have any reaction to the factory workers that were beaten and detained for protesting Covid lockdowns? Do you regret restricting AirDrop access that protesters used to evade surveillance from the Chinese government? Do you think it’s problematic to do business with the Communist Chinese Party when they suppress human rights?”

A stone-faced Mr. Cook responded with silence.

. . .

CEOs can always justify their operations by pointing to the economic benefits their companies bring to the communities in which they operate. Or CEOs can go the progressive route, presenting their companies as moral paragons. But they can’t have it both ways: holding themselves up as courageous in places where the risk from speaking out is low while keeping quiet about real oppression in places where speaking out can really hurt the bottom line.

For the full commentary, see:

William McGurn. “MAIN STREET; Tim Cook’s Bad Day on China.” The Wall Street Journal (Tuesday, Dec. 6, 2022): A19.

(Note: ellipsis, and bracketed date, added.)

(Note: the online version of the commentary has the date December 5, 2022, and has the same title as the print version.)

In Xi’s Communist China: “Our Speech Is Not Free”

(p. B1) Many innocent lives were lost to tragic events in China in the past month. So far we haven’t learned a single name of any of them from China’s government or its official media. Nor have we seen news interviews of family members talking about their loved ones.

Those victims would include a coach and 10 members of a middle-school girls volleyball team who were killed in late July when the roof caved in on a gymnasium near the Siberian border. Despite an outpouring of public grief and anger around the country, the government never released their names. Social media posts sharing their names and tributes to their lives were censored.

Then there were the people — probably dozens, possibly hundreds — who died in severe flooding in northern and northeastern China in recent weeks. It was the most serious flooding in the country in decades. Posts about the casualties, and the hardships people endured, were censored.

. . .

(p. B4) “Xi Jinping has made control of history one of his signature policies — because he sees counter-history as an existential threat,” Ian Johnson, an author who has covered China for decades, wrote in his new book, “Sparks: China’s Underground Historians and their Battle for the Future.”

Mr. Xi has turned the screws extra tight since the Covid pandemic. In April 2020, relatives of Wuhan residents who died were followed by minders when they picked up the ashes of their loved ones.

The government ignored a citizen demand to make Feb. 6 a nationwide day of mourning to mark the death of Dr. Li Wenliang, the whistle-blower who had warned the public of the coronavirus.

“We have always known that our speech is not free, our voice is not free. Yet we do not realize until today that even sorrow and mourning do not belong to us,” Ms. Zhang, the independent journalist, wrote in an article that was widely circulated on WeChat and other social media platforms before it was censored.

A recent video of the bereaved father of a volleyball player killed in the gymnasium collapse in Qiqihar highlighted the cruel reality faced by family members in public tragedies: Their grief, in the eyes of the government, makes them potential threats to social stability.

In the six-minute video, the father remained preternaturally composed as he tried to reason with the police, doctors and government officials at a hospital. He and other family members wanted to be allowed to identify the bodies of their daughters.

The father said he understood why the police were at the hospital. “We didn’t cause any troubles,” he said. He said he understood why no officials bothered to talk to them. “That’s fine,” he said.

Many people said online and in interviews that they cried watching the video because they recognized his “heart-wrenching restraint” and knew why he behaved that way.

“What happens if he didn’t hold back his anger?” asked an author in an article posted on social media. “As a father who has suffered such immense pain, why did he have to reason with such restraint and humility?”

As usual, the censorship machine went into high gear. Social media posts containing names of the victims and celebrating their lives and friendships were deleted. So were photos and videos showing the entrance of their school, where the public sent numerous flower bouquets, yogurt, milk tea and canned peaches, which is a comfort food for children in northeastern China.

For the full story, see:

Li Yuan. “When Tragedy Strikes in China, The Government Represses Grief.” The New York Times (Monday, August 3, 2023): B1 & B4.

(Note: ellipsis added.)

(Note: the online version of the story also has the date Aug. 14, 2023, and has the title “When Tragedy Strikes in China, the Government Cracks Down on Grief.”)

Chinese Communists Detain Entrepreneur Who Exhorted Staff to “Go Forward Boldly”

(p. B1) In mid-January [2023], star Chinese investment banker Fan Bao, architect of the deals that created some of China’s most dominant technology companies, appeared at his bank’s annual party in Beijing.  . . .  He exhorted the hundreds of staffers in attendance to “Go Forward Boldly.”

A few weeks later, he disappeared.

For the past month, the 52-year-old banker—who set out to build the JPMorgan of China and successfully straddled the divide between China and the West—has been held incommunicado in a detention system run by the Communist Party’s anticorruption agency.

. . .

(p. B6) Privately, close associates of Mr. Bao have been dismayed by his detention. China Renaissance Holdings Ltd., the boutique investment bank he founded and ran, is a relatively small firm, making it unusual that it would draw this manner of government scrutiny. Colleagues, business partners, friends and acquaintances of Mr. Bao are worried about his safety and are hoping he will soon resurface publicly. “I feel utterly disillusioned,” said a person close to Mr. Bao.

The jolt to business people’s confidence also comes as anxiety over China’s direction, its curtailing of people’s rights, and the way it managed the Covid-19 pandemic is leading more middle-class and wealthy Chinese citizens to relocate to other countries. Global investors have been rethinking their exposure to the world’s second-largest economy following a selloff over the past two years that was largely caused by Beijing’s regulatory crackdowns and policy decisions.

. . .

Some Chinese entrepreneurs who previously went missing have reappeared quickly. Guo Guangchang, the billionaire chairman of Shanghai-based conglomerate Fosun Group, emerged days after a mysterious detention by authorities in late 2015. He continues to run Fosun and was never charged with any wrongdoing.

Xiao Jianhua, a Chinese financier who ran a conglomerate called the Tomorrow Group, was taken from Hong Kong in 2017 and didn’t reappear for five years. He turned up in a Shanghai court last year to face corruption charges and was sentenced to 13 years in prison.

. . .

Mr. Bao believed China was on the cusp of a new-economy revolution and connected early on with young entrepreneurs who were trying to get their internet-technology startups off the ground.

. . .

Mr. Bao tried to adapt to the new environment, shifting his attention to pursuing deals in industries like semiconductors that remained in Beijing’s good graces.

. . .

Mr. Bao’s last post on Chinese social media WeChat was on Jan. 9 [2023], a few days before the China Renaissance party. He congratulated Fenbi Ltd., a vocational training provider and a portfolio company in his firm’s fund, on its Hong Kong listing. Under his personal status, Mr. Bao had written: “Dream as if u’ll live forever, live as if u’ll die today.”

For the full story, see:

Jing Yang and Rebecca Feng. “China’s M&A Star Vanishing Spurs Alarm.” The Wall Street Journal (Monday, March 20, 2023): B1 & B6.

(Note: ellipses, and bracketed years, added.)

(Note: the online version of the story has the date March 18, 2023, was listed with the title “China’s M&A Star Tells Staff to Be Bold—Then He Disappears,” and had the title “China’s M&A Star Told His Employees to Be Bold—Then He Disappeared” at the top of the story.)

Communist China Has “Opened Police Outposts in Foreign Countries” to Arrest Chinese Exiles

(p. 10) As a lawyer in China, Lu Siwei belonged to a rare and increasingly besieged group willing to take on sensitive cases to defend rights activists and political pariahs. To stop him, the authorities put him under surveillance and barred him from practice, depriving him of his livelihood.

Mr. Lu’s wife and young daughter fled first, moving to the United States. Nearly two years later, it was Mr. Lu’s turn. He left China last month, crossing over into Laos. A few days later, as he was preparing to board a train to Thailand, he was arrested by local authorities. Accused of using fraudulent travel documents, he was in Laotian custody as of late August and facing the threat of deportation.

Under Xi Jinping, China’s most iron-fisted leader in decades, Chinese authorities have aggressively expanded their net outside the country. They have opened police outposts in foreign countries, offered bounties for critics who have fled overseas, pressured members of the Chinese diaspora to become informants, and secured the detention or deportation of exiles abroad.

For the full story, see:

Tiffany May. “He Fled Repression, but China’s Long Arm Caught Him in Another Country.” The New York Times, First Section (Sunday, Aug. 27, 2023): 10.

(Note: the online version of the story has the date Aug. 26, 2023, and has the title “He Fled China’s Repression. But China’s Long Arm Got Him in Another Country.”)

Chinese Communists Suppress “A Touching Portrait of Love and Resiliency”

(p. C6) According to reliable news reports, the Chinese government never confirmed having banned Li Ruijun’s quietly heartbreaking feature “Return to Dust,” a touching portrait of love and resiliency in a collapsing rural community of Gansu Province.

Still, the film was pulled last fall from all Chinese movie theaters and streaming services two weeks after a successful domestic debut. It isn’t hard to see why. China’s leadership has a history of suppressing art that spotlights the failings of its ruling class and ideology, which is exactly what Li’s film does, . . .

For the full movie review, see:

Austin Considine. “Return to Dust.” The New York Times (Friday, July 21, 2023): C6.

(Note: the online version of the review has the date July 20, 2023, and has the title “‘Return to Dust’ Review: Grit Against All Odds.”)

Chinese Communists Suspend Release of Record High Youth Unemployment Rate

(p. B1) The Chinese government, facing an expected seventh consecutive monthly increase in youth unemployment, said Tuesday [Aug. 15, 2023] that it had instead suspended release of the information.

The unemployment rate among 16- to 24-year-olds in urban areas hit 21.3 percent, a record, in June and has risen every month this year. It was widely forecast by economists to have climbed further last month.

The decision to scrub a widely watched report could exacerbate the concerns expressed by investors and executives who say ever-tightening government control of information is making it harder to do business in China.

Fu Linghui, a spokesman of the National Bureau of Statistics, said at a news briefing that the government would stop making public employment information “for youth and other age groups.” He said the surveys that government researchers use to collect the data “need to be further improved and optimized.”

China’s youth unemployment rate has doubled in the last four years, a period of economic volatility induced by the “zero Covid” measures imposed by Beijing that left companies wary of hiring, interrupted education for many students, and made it hard to get the internships that had often led to job offers.

The announcement drew more than 140 million views on the Chinese social media site Weibo within a few hours. Many people (p. B3) commenting online, some turning to sarcasm, said they believed the government suspended the report to try to hide negative information. Others said they believed the public had the right to be informed.

. . .

Young people in China are facing a big gap between labor demand and supply. According to official data, 11.6 million students were expected to graduate college or university this year — the most ever and nearly one million more than last year. Future classes are expected to be even larger, while economic growth had started to slow even before the pandemic.

. . .

Even becoming an entry-level civil servant working for the government is harder these days. Last year, a record 2.6 million people applied to take the national civil service exam to compete for only 37,100 entry-level positions.

Xi Jinping, the country’s top leader, has called for young people to go to remote areas to find work — to “eat bitterness,” a Chinese expression that refers to enduring hardship.

For the full story, see:

Claire Fu. “China Scraps Jobs Report On the Young.” The New York Times (Wednsday, August 16 2023): B1 & B3.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the review has the date Aug. 15, 2023, and has the title “China Suspends Report on Youth Unemployment, Which Was at a Record High.”)

Mass Internment of Hundreds of Thousands of Muslim Uyghurs in Communist China

(p. C3) Tahir Hamut Izgil watched as parks emptied of people, naan bakeries boarded up their windows and, one after another, his friends were taken away.

The Chinese government’s repression of Uyghurs, the predominantly Muslim ethnic minority to which he belonged, had gone on for years in Xinjiang, the group’s ancestral homeland in China’s northwest. But in 2017, it morphed into something more terrifying: a mass internment system into which hundreds of thousands of people were disappearing. Millions lived under intense and growing surveillance.

Izgil, a prominent poet and film director, feared that one day soon, the authorities would come for him. So he did what few have managed — in the summer of 2017, he escaped with his family, and once settled in a Virginia suburb, he wrote about the experience.

In his memoir, “Waiting to Be Arrested at Night,” published this week by Penguin Press, Izgil brings his discerning eye for detail to describe the impact of China’s policies on the people who live under them.

Scholars and journalists have detailed the architecture of the surveillance system against Uyghurs. There have also been memoirs by Uyghur authors and intellectuals in exile. But few possess Izgil’s firsthand knowledge and analytical acuity, said Darren Byler, a leading scholar on Uyghur culture and Chinese surveillance and a professor at Simon Fraser University, in Canada.

“This is the defining account of what it’s like to live through this moment,” Byler said. “This will be the book that, in 10 years or 20 years, people will turn to if they want to understand that moment.”

For the full story, see:

Tiffany May. “The Toll of a Life Spent Under a Heavy Hand.” The New York Times (Tuesday, August 8, 2023): C3.

(Note: the online version of the story has the date Aug. 1, 2023, and has the title “A Poet Captures the Terror of Life in an Authoritarian State.”)

The book discussed above on the mass internment of the Uyghurs is:

Izgil, Tahir Hamut. Waiting to Be Arrested at Night: A Uyghur Poet’s Memoir of China’s Genocide. Translated by Joshua L. Freeman. New York: Penguin Press, 2023.

Scientists Had Political Motives for Dismissing Wuhan Lab-Based Covid Origin

(p. A17) On March 17, 2020, the journal Nature Medicine published a paper by five scientists, “The Proximal Origin of SARS-CoV-2,” that dismissed “any type of laboratory based scenario” for the origin of the pandemic. It was cited by thousands of news outlets to claim that the virus emerged naturally. But Slack messages and emails subpoenaed and released by the House Oversight Select Subcommittee on the Coronavirus Pandemic suggest that some of the authors didn’t believe their own conclusions. Before, during and even after the publication of their paper, they worried privately that Covid-19 was caused by a laboratory escape, perhaps even of a genetically engineered virus.

. . .

On April 16, a month after publication, Mr. Andersen wrote that “I’m still not fully convinced that no culture was involved” and “we also can’t fully rule out engineering”—i.e., that the virus not only was released from the lab but had been genetically manipulated there. He worried about the Wuhan lab’s research on live SARS-like viruses from bats at low biosafety levels: “it’s definitely concerning work, no question about it.”

So why did they publish a paper denying that laboratory origin was plausible? The answer may lie in their messages. In early February 2020, Mr. Rambaut wrote: “Given the s— show that would happen if anyone serious accused the Chinese of even accidental release, my feeling is we should say that given there is no evidence of a specifically engineered virus, we cannot possibly distinguish between natural evolution and escape so we are content to ascribing it to natural processes.”

Mr. Andersen replied: “I totally agree that that’s a very reasonable conclusion. Although I hate when politics is injected into science—but it’s impossible not to.”

. . .

To adjust the conclusions in a scientific paper for political reasons isn’t part of the scientific process. The world was misled with serious consequences.

For the full commentary, see:

Matt Ridley and Alina Chan. “The Covid Lab-Leak Deception.” The Wall Street Journal (Thursday, July 27, 2023): A17.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 26, 2023, and has the same title as the print version.)

Disenchanted Young Chinese Are “Lying Flat” or Joining the Bureaucracy

(p. A1) HEFEI, China—More than one in five young people in China are jobless. The government casts much of the blame on the job seekers themselves, insisting that their expectations have gotten too high.

. . .

The government’s guidance is ringing hollow with many young people. Growing up in a period of rising prosperity, they were told that China was strong, the West was declining and endless opportunities awaited them. Now, with the urban youth unemployment rate hitting a record of 21.3% in June, their employment frustrations are posing a new challenge to Xi and his vision for a more powerful China.

For the estimated 11.6 million college graduates in 2023, having heeded calls by the state to study hard, the prospect of resorting to the physical labor that many of their parents performed is distinctly unappealing.

. . .

(p. A10) The problem isn’t that jobs don’t exist in China. They do. With its shrinking population, China needs workers as much as ever. It is that China’s weakened economy isn’t producing enough of the high-skill, high-wage jobs that many college students have come to expect.

This is especially so after Xi’s targeting of the private sector in recent years with regulatory crackdowns on technology and other companies.

Disenchanted, many young people are opting out of the job market entirely, or “lying flat,” as many of them call it. Chinese media has recently featured articles about young “drifters” who live hand-to-mouth and pick up odd jobs as they roam the country.

Many of those who still want to work have soured on the private sector, with surging numbers of people sitting for the country’s civil-service exam for a chance at a low-paid, but stable, role in China’s bureaucracy.

For the full story, see:

Brian Spegele. “Unemployed Youth Cast Pall Over China’s Economy.” The Wall Street Journal (Thursday, July 27, 2023): A1 & A10.

(Note: ellipses added.)

(Note: the online version of the story has the date July 26, 2023, and has the title “How Bad Is China’s Economy? Millions of Young People Are Unemployed and Disillusioned.”)

The Talented, Wealthy, Ambitious, and Hardworking Vote with Their Feet Against Communist China

(p. B12) Is China reopening to the world or turning inward again?

Many would argue the latter, but in one important way, the country is still going global: Residents appear to be leaving at a faster clip than they have in years, including a significant number of the wealthy and well-educated the nation needs to keep modernizing and investing.

. . .

Rebounding emigration is also striking in the context of a declining overall birthrate, and suggests that Beijing must do far more to convince talent, both domestic and foreign, that China is a good place to put down roots if it wants to avoid a steeper growth slowdown in the years ahead.

. . .

Rising net emigration also mirrors much smaller influxes of foreign talent in recent years—another trend that threatens to slow China’s climb up the technological ladder. Foreign residents of Shanghai and Beijing numbered just 163,954 and 62,812 in 2020, according to official data, down 21% and 42%, respectively, since 2010. The pandemic is clearly a major factor. But given the well-publicized rising tensions between China and the West, slowing growth and the rising risks of detention and investigation for what used to be considered routine business by foreigners in China, a portion of that decrease seems very likely to persist.

For much of the new millennium, China has been a place where the ambitious, hardworking and lucky could often get ahead. But in today’s China—more focused on security and control, less on growth—it is no longer clear how true that really is.

Some people, at least, seem to be voting with their feet.

For the full commentary, see:

Nathaniel Taplin. “HEARD ON THE STREET; China’s Brain Drain Threatens Its Future.” The Wall Street Journal (Thursday, July 6, 2023): B12.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 5, 2023, and has the same title as the print version.)