Hong Kong in decline

Losing ground: China’s spectacular rise has affected Hong Kong’s thriving financial services industry, along with development of port services. - Reuters

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TWO generations ago cheap goods from Hong Kong were labelled simply “Made in Hong Kong,” but their poor quality soon made that embarrassing.

For marketing reasons they were then labelled “Made in the British Empire” or “Empire Made.” Britain, home of the First Industrial Revolution, was better regarded than any Far Eastern outpost.

However, manufacturing could never suffice for Hong Kong’s economy because of limited land and rising property prices.

Enter the space-efficient financial services industry, along with development of port services. Then a generation ago Hong Kong began to face its biggest challenge: China’s spectacular rise.

But if Hong Kong would be part of China again, wouldn’t it also enjoy the mainland’s rising fortunes?

Hong Kongers always had a problem with the first part ever since Britain’s takeover in 1841.

From the late-1970s the West was all for China’s “opening up” policies. Hong Kongers looked across the water to see Shenzhen’s phenomenal rise from old market town to bustling modern metropolis.

Shenzhen had twice Hong Kong’s population and a much faster rate of development. As just one cog in China’s production behemoth, Shenzhen soon buried Hong Kong’s prospect as a manufacturing centre.

In global references Hong Kong-Shenzhen-Guangzhou is the world’s biggest productive mega region, demographically twice the size of the next biggest in Nagoya-Osaka-Kyoto-Kobe.

But Hong Kongers still regarded themselves as a breed apart from the mainland – a “Made in the British Empire” attitude dies hard.

Surely Hong Kong still had superlative status as a leading port and financial services centre?

Not quite, especially when Shanghai would soon outclass it on both counts.

Hong Kong slipped to fifth place among the world’s busiest container ports. Among the world’s Top 10, six are now on China’s mainland.

The Shanghai Municipality’s population is 3.5 times Hong Kong’s, with an area 5.7 times as large, meaning a more relaxed population density of just 62% of Hong Kong’s.

Shanghai’s 2018 nominal GDP was US$494bil (RM2.04 trillion), which was 136.1% of Hong Kong’s. Even Shenzhen is catching up with Hong Kong, falling short by just 3.3%.

Business is Hong Kong’s business, but the mainland is doing better in both performance and prospects.

The Hong Kong stock market is not necessarily stable. Since the 1960s it has experienced a dozen market crashes.

Shanghai’s Stock Exchange market capitalisation of US$5.01 trillion is larger than Hong Kong’s by 26.5%. Hong Kong’s exceeded Shenzhen’s by only 12.8%.

Hong Kong as business enclave has been eclipsed and outdone by the mainland. At the same time its future increasingly depends on the mainland.

Since 1997, Hong Kong dropped from representing 20% to just 3% of China’s GDP.

For China today Hong Kong is just another Chinese city, meaning it is dispensable. Shenzhen and the rest of the mainland do not need a nettlesome Hong Kong for China’s continued rise.

Hong Kong protesters have committed at least a dozen strategic errors.

1. One, they assume Hong Kong is essential to the mainland’s future when only the reverse is true. There is no equivalence between Hong Kong and the mainland in any way that works for Hong Kong.


2. Two, protest appeals to mainlanders for support mistakenly attempt to rekindle the spirit of Tienanmen Square protests a generation ago. Those protesters are now part of the system in a prosperous new China, actively engaged in business or government. Their original 1989 complaint of corruption in high places is keenly addressed by Beijing.


3. Three, attempts to solicit mainlanders’ support are badly confused with prejudice against them. Within days of trying to spread the protest message to mainlanders in July, protesters attacked mainland traders, shoppers and tourists.


4. Four, protesters violently attacked police personnel, alienating many Hong Kongers including most protesters. It signalled a slide towards civil disorder.


5. Five, vandalising the Legislative Council building established illegal conduct and further alienated everyone else.


6. Six, more violence was targeted at the liaison office when sympathisers had thought protesters would never do that. It confirmed the criminality discrediting the protests as a whole.


7. Seven, besides disrupting traffic and commerce, harassing passengers at the airport and train stations. It did nothing to promote their cause to the general public but quite the opposite.


8. Eight, protests did not subside even after Hong Kong’s Executive backed down on the extradition Bill. It revealed the unreasonable nature of the protests.


9. Nine, no protester had demanded democracy for Hong Kong in 156 years of British colonial rule. If they had, they may have a legitimate basis for demanding democracy today.


10. Ten, it was foolish to unfurl the Union Jack and call for reverting to British rule. Seeking the denial of democracy by a foreign hand exposes the hypocrisy of the protests.


11. Eleven, it was foolhardy to unfurl “Old Glory,” calling for US intervention during a US-China trade war. With trade a major basis of Hong Kong’s survival, it was politically suicidal.


12. Twelve, protesters fail to understand that no other country can or would do what is necessary to boost Hong Kong’s fortunes. Only the mainland can do that if it wants to.

Young protesters still to find employment amid poor conditions and rising costs may think they have legitimate grievances.

Yet all the solutions – more investment, better job prospects, even improved governance – can come meaningfully only via the mainland.

Beijing can deploy troops to Hong Kong, but to what end?

Hong Kong’s worst punishment is getting exactly what the protesters want – isolation. That will leave it further behind as the mainland prospers, surging ahead.

Hong Kong can stew in its own juices until tender. Beijing may let the anger fester and rot until then.

Hong Kong’s strength as money-making hub is also its weakness. Its stock market can crash again, which can also send a message to Taiwan.

Hong Kong tycoons are already looking for more places abroad to stash their fortunes. Without decisive mainland investment, the economic enclave can die a natural death.

What’s left of Hong Kong’s Establishment will then surely discipline rowdy mobs. The triads have already shown leadership here, symbolising the decline.

By Bunn Nagara, a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia. The views expressed are entirely the writer’s own.

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THE United States ranks low in the credibility stakes. It can no longer wax lyrical about free trade and fair play because the world now knows that when it finds itself facing stiff competition, it uses a ruling the magnitude of a nuclear bomb to retaliate.

Firstly, US president Donald Trump declared a national emergency and barred American companies from doing business with companies deemed a national security risk.

Then, companies like Google and Microsoft stopped making software and services available to Huawei, China’s biggest smartphone vendor. The ban essentially means that future Huawei phones will no longer get Google play apps, YouTube, and almost certainly no updates to Android Q or other platform-level upgrades since these would require Google’s sign-off, too.

Sure, you can still make calls or use WeChat and other Chinese platforms, but for users in most parts of the world, the phone is pretty much useless.

Word is that Huawei poses a security risk, but no clarification has been forthcoming to what these threats include exactly.

There is a sense of déjà vu here.

The world was once told by the US and its allies that Iraq had weapons of mass destruction, but we learnt in the end there were none. Now, we have the Iran threat, but that’s another story all together.

From what little info has trickled into the worldwide web, the suggestion is that Chinese-manufactured devices have hidden back doors that could potentially allow an attacker to gain special access.

It sounds like a script excerpt from a James Bond movie, with spooks using a master password to break into high security facilities.

But incredibly, Huawei and ZTE Corp, another telecommunications equipment manufacturer, were cleared by the US House of Representatives permanent select committee on intelligence.

The two had been accused of providing “incomplete, contradictory and evasive responses to the committee’s core concerns” during their year-long investigation on the threat they supposedly pose to American interests.

In the end, the committee found no concrete evidence of infringement. But that didn’t stop the two companies from being labelled a national security risk and getting kicked out of the US.

IS, the German internet security watchdog, inspected Huawei laboratories in Germany and found no evidence of espionage, and The New York Times quoted American officials saying that the case against the company had “no smoking gun – just a heightened concern about the firm’s rising technological dominance”.

Rightly or wrongly, in the game of perception, the US has lost its moral ground. Thanks, in many ways, to an impulsive president.

Most of the world’s population thinks the bullying of Huawei is simply Trump’s hallmark. It isn’t about a security risk, but an economic threat.

Outside China, Huawei is arguably the most successful Chinese consumer brand so far. Thanks to a good and relatively cheaper product, it is now the second largest phone vendor in the world.

One strong accusation levelled at Huawei is that it enjoys Chinese government backing, and that China uses its spies to steal US technology for these private companies.

It’s a really warped perspective because, using the same logic, why is the US president taking such a hard line against a private company that’s merely selling phones?

The answer could well lie in the technology race.

Now, it’s about who launches 5G first, the next generation of mobile broadband imminently replacing 4G.

With 5G, we will see exponentially faster download and upload speeds. Huawei is widely renowned for being 12 months ahead of its competitors in the 5G race.

It began to develop its own 5G technology in as early as 2009. In 2013, Huawei hired more than 300 top experts from the wireless industry around the world and announced that they had invested US$600mil (RM2.5bil) in 5G research.

In 2016, Huawei set up a 5G product line for such devices.

What started as a three-man company now has thousands of employees engaged in 5G product development. Following this, in 2017, and then in 2018, Huawei invested almost US$1.4bil (RM5.8bil) in 5G product development.

The South China Morning Post has, however, also reported that apart from its tremendous commercial benefits, 5G – the fifth generation of mobile communication – is revolutionising military and security technology, which is partly why it has become a focal point in the US’ efforts to contain China’s rise as a tech power, and the Western nation’s allegations against Chinese companies is simply symptomatic of its insecurities.

“The future landscape of warfare and cybersecurity could be fundamentally changed by 5G.

“But experts say 5G is more susceptible to hacking than previous networks, at a time of rising security concerns and US-China tensions on various interconnected fronts that include trade, influence in the Asia-Pacific region and technological rivalry.

“These tensions provide the backdrop to controversy surrounding Huawei, the world’s largest telecoms equipment supplier.” It’s also a fight between China and the US on who leads the artificial intelligence domain, as with 5G advancements, it means “whereas existing networks connect people to people, the next generation will connect a vast network of sensors, robots and autonomous vehicles through sophisticated artificial intelligence.

“The so-called Internet of Things will allow objects to ‘communicate’ with each other by exchanging vast volumes of data in real time, and without human intervention.

“Autonomous factories, long-distance surgery or robots preparing your breakfast – things that previously existed only in science fiction – will be made possible.

“Meanwhile, though, it is being identified by many military experts as the cornerstone of future military technology,” the newspaper reported.

As TV personality Trevor Noah says, humorously, in his show, the 5G war isn’t just about “loading an entire movie in three seconds but about the Chinese spying – which the US also wants to do.”

He sarcastically added that “the US is losing the 5G race and luckily, we have a maniac in our team who’s willing to play dirty.”

As the battle rages on, spilling into the already acrimonious US-China trade war, the controversy has become more bitter, and complicated, with the US egging its allies to ban Huawei from building its next generation of mobile phone networks. So far, Britain, Germany, Australia, New Zealand and Canada have either banned Huawei or are reviewing whether to do so.

Japan, a US ally, seems to have been dragged into the propaganda of persecuting Huawei, too.

In China, the actions against Huawei have stirred a storm of nationalism, with the Chinese calling for a boycott of iPhone, a reaction which could eventually affect other American and European products, at the rate things are escalating.

Even within the Chinese diaspora, the messages of unequivocal support for Huawei have gone viral in the world’s social media sphere.

The irony is that the iPhone is not only assembled in China, but its very inception starts in that country at a much earlier stage, and from a much deeper part of the earth, too.

At least 90% of rare earth minerals – naturally occurring solids whose combination comprises essential iPhone parts – are mined in China, notably in Mongolia, it’s reported.

“Lanthanides, scandium, yttrium and some other alien-sounding names at the bottom of the periodic table (remember your secondary school?) make the iPhone ‘light, bright and loud.’ Its colour screen, glass polishing, circuitry, speakers and vibration unit come from a mix of these rare earth minerals,” it says in Finances Online.

The report added that where American companies would take months to pool thousands of industrial engineers, and even more months to construct new assembly lines to accommodate a trivial but urgent change in an iPhone spec (say, its glass panel needing to curve to hatch on the body six weeks prior to launching), it only takes 15 days in China to do the same.

“To put it in perspective, one production line in China can assemble 72,000 iPhone 5 back plates daily; one factory can have four to five production lines and China can have as much as a hundred of these factories, opening or closing a few of them depending on the current demand.

“The last part – opening and closing plants like a mom-and-pop store – is almost impossible in an American economy.

“It is no longer a city counting the number of manufacturing plants it has, but the manufacturing plant can be counted as a city in many Asian economic zones.”

And it’s common knowledge that Mickey Mouse merchandise is made in China, and likewise all the branded sportswear sold globally. The profits these companies are raking in are simply down to the low cost of operation.

Trump should know and do better. Instead of threatening and bullying Huawei with trumped up charges, he should urge American companies to be more competitive, make better products and keep prices low.

I am dumping my iPhone, upgrading my South Korean Samsung and for the first time, getting myself a Huawei. I hear the camera is really good, and it doesn’t even need a zoom lens for magnification. And that sophistication comes from a license to thrill.

By Wong Chun Wai

Wong Chun Wai began his career as a journalist in Penang, and has served The Star for over 27 years in various capacities and roles. He is now editorial and corporate affairs adviser to the group, after having served as group managing director/chief executive officer.

On The Beat made its debut on Feb 23 1997 and Chun Wai has penned the column weekly without a break, except for the occasional press holiday when the paper was not published. In May 2011, a compilation of selected articles of On The Beat was published as a book and launched in conjunction with his 50th birthday. Chun Wai also comments on current issues in The Star.

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China digs in for protracted trade fight with US - The Sun Daily

Commentary: China fights U.S. trade bullying with "Long March" spiri

 

Trade war gives US unfavorable image

US President Donald Trump on Thursday announced a $16 billion aid package for farmers to offset their losses from the trade war with China. He said the package "will be paid for by the billions of dollars" from tariffs on Chinese imports.

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All Chinese companies wishing to get to the high-tech mountaintop should learn from Huawei's composed example. If only there were a group of Chinese companies sharing intellectual property with foreign partners, then certain malicious forces would hesitate at a crackdown.

Fast economic development best way to deal with security challenge

China's economic potential is far greater than that of the US, the largest economy. There is no doubt that China's economic prospects are the best in the world. These facts drive China's core competitiveness. They will make Washington feel its ability falls short of its wishes when it comes to containing Beijing.

US orchestrates self-defeating maneuvers

Chinese people do not know whether we should call US approaches hegemonic politics or profiteering politics. But in short, they are crooked means. The threat of tariffs will not work. Neither will US threats against Chinese companies create a shock wave against China. The US is picking a wrong opponent at a wrong time. It will find no way of crafting a good result from a strategic mistake.

Growing US pressure won't force China to submit

The US is having a profound effect on the global economic order by abusing national security and trampling on commercial principles. Current US administration is destroying the reputation and national image that generations of Americans have built. Such arrogance and hegemony are by no means good signs for the US.

Why does the West fail to understand China? The West misreads, China is rising, said Cambridge Prof

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Martin Jacques
Martin Jacques (2012)
Born	1945 (age 73–74) Coventry, England, Great Britain, U.K
Nationality	British
Education	King Henry VIII School, Coventry
Alma mater	University of Manchester (B.A.) University of Cambridge (PhD)
Occupation	Editor, academic, author
Website	MartinJacques.com

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US relies on deception and is most afraid of protracted trade war

The economic data of China and the US for the month of April was not good. There are divergent views on the reasons for China's declining retail sales growth rate and especially, its industrial output growth. But amid China's overall expectations that a trade war could have some impact on the economy this year, one month's unsatisfactory data is socially and psychologically affordable.

The problem for the US is that the government won't admit that a trade war would have a negative impact on its own economy. Instead, the Trump administration advocates that tariff revenue is a good option for the US to boost economic growth.

In fact, Chinese society's understanding of the current situation is very objective, and the official and civil understanding is echoed by each other. Chinese society is confident in the country's broader economic prospects, based largely on the country's enormous economic potential and the government's ability to take strong measures to minimize the negative impact of a trade war and contain possible unexpected risks. In addition, it is believed that as long as China resists the pressure, the US will sign the agreement with China sooner or later, because the US also feels uncomfortable.

Most of those tariffs will be shared by American importers and consumers, and it is against the common sense of international trade for the US government to insist that tariffs are paid only by Chinese export enterprises.

If the White House now publicly acknowledges the negative impact of the trade war on itself and is still able to unite the US society, then the trade war will be even more difficult for China to deal.

The US side has created a false impression that it is strong, but in fact it is weak on the inside. If the US side wants to fight, we may as well do so. China also has modest demands, namely, to safeguard its sovereignty and uphold the principle of equality in China-US relations.

In a worst-case scenario, China would suffer losses which it could still afford. The great leeway of our society can certainly have a considerable damping effect. Under better circumstances, we can quickly build resilience so that China's economy will once and for all reduce its excessive dependence on the US market, and people's interests are better protected in the long run.

The US trade war with China will build up into a political bubble as it diverges from reality. We just need hold our breath, and try to do our own thing as much as possible. It will gradually deflate on its own.

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Strong navy steers more balanced, steady rise of China

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On April 12, Chinese President Xi Jinping, who is also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission, made important remarks during a naval parade held in the South China Sea. The event is the largest maritime military parade in the history of the People's Republic of China, showcasing a new height of the People's Liberation Army Navy via its Liaoning carrier battle group and the new-generation nuclear submarine. China's ability to defend world and regional peace has reached another milestone.

During his speech, Xi noted that the mission of building a strong navy has never been more urgent. This is crucial to point out in today's international environment and his tone carried a robust sense of mission.

Xi has expressed in several key reports that China is closer than ever to achieving the great rejuvenation of the Chinese nation. However, history reminds us that the closer we are to accomplishing a glorious goal, the more the pressure and risk. Building a strong navy, as well as national defense, has never been more significant to China.

After 40 years of reform and opening-up, China has risen to become the world's second largest economy. In this process, China has further advanced its unstoppable economic potential. However, China's elevated status, accompanied by its incredible progress, has attracted both friendly and hostile gestures. Thus, catching up in national defense is necessary to attain balanced growth. For any big nation, strong economic development without balanced efforts in national defense is a dangerous combination. This might give other powers the idea and temptation to subdue China with non-economic methods.

A country's navy is considered the force that bears most pressure, while also being the most active in the modern military. Despite all the military forces of a country, the navy usually stands at the forefront in crucial moments. The technologies for naval forces are complex and at a high cost, representing the refined strength of its country. Strong naval forces only belong to a powerful country, reflecting the accumulation of a nation's strength, and indicating the nation's future and destiny.

The step-by-step development of Chinese navy is steady and strong. Through the South China Sea military parade, Chinese people can see that part of China's economic strength is quickly converting to military strength. We can also predict that China's ability to convert between its strengths will be stronger in the future.

The logic of maintaining peace is different among major, mid-sized and small countries. China must objectively understand the security situations we are dealing with and build the People's Liberation Army (PLA) to show that it projects power and focuses on maintaining peace. This is an urgent task which requires racing against time.

China must ignore the noise of the "Chinese military threat" theory from some Western countries. The theory is a misrepresentation of China's role as the world's second-largest economy and its role in securing global peace. The theory is also a discrimination to China's status as one of the world's major powers.

To build a top-tier navy, China has a long way to go. To understand the enormous challenges China faces in building a blue-water navy, one should look at how other countries monitor and scrutinize China's foreign ports and naval supply checkpoints. Furthermore, China's navy needs to accumulate vast experience to become an effective instrument in China's toolbox for deterrence.

There are two essential strategic questions for China: How do we show others our determination in defending national interest under the thesis of 'China's peaceful rise'? How do we communicate our simultaneous dedication to world peace and resolution to fight aggression?

Many WWII-era ships are still commissioned by other navies around the world, and yet more than half of the ships participating in this parade started their service around the time of the 18th National Congress of the Communist Party of China. The Chinese navy has rapidly developed, and we believe it will continue to do so until it reaches its maturity. China will be more secure and the world more peaceful as the Chinese navy sails into the deep blue sea. - Global Times

Goodbye, Silicon Valley

Greener pastures: Wang at his company’s headquarters in Shanghai. The successful Silicon Valley alumni was lured back to China by the promise of a brighter future.

Chinese-born talents are abandoning California for riches back home with the rise of China's new titans.

A FEW years ago, Wang Yi was living the American dream. He had graduated from Princeton, landed a job at Google and bought a spacious condo in Silicon Valley.

But one day in 2011, he sat his wife down at the kitchen table and told her he wanted to move back to China. He was bored working as a product manager for the search giant and felt the pull of starting his own company in their homeland.

It wasn’t easy persuading her to abandon balmy California for smog-choked Shanghai.

“We’d just discovered she was pregnant,” said Wang, now 37, recalling hours spent pacing their apartment. “It was a very uneasy few weeks before we made our decision, but in the end she came around.”

His bet paid off: his popular English teaching app Liulishuo or LingoChamp raised US$100mil (RM397mil) in July, putting him in the growing ranks of successful Silicon Valley alumni lured back to China by the promise of a brighter future. His decision is emblematic of an unprecedented trend with disquieting implications for Valley stalwarts from Facebook Inc to Alphabet Inc’s Google.

US-trained Chinese-born talent is becoming a key force in driving Chinese companies’ global expansion and the country’s efforts to dominate next-generation technologies like artificial intelligence and machine learning. Where college graduates once coveted a prestigious overseas job and foreign citizenship, many today gravitate towards career opportunities at home, where venture capital is now plentiful and the government dangles financial incentives for cutting-edge research.

“More and more talent is moving over because China is really getting momentum in the innovation area,” said Ken Qi, a headhunter for Spencer Stuart and leader of its technology practice.

“This is only the beginning.” Chinese have worked or studied abroad and then returned home long enough that there’s a term for them – “sea turtles”. But while a job at a US tech giant once conferred near-unparalleled status, homegrown companies – from giants like Tencent Holdings Ltd to up-and-comers like news giant Toutiao – are now often just as prestigious. Baidu Inc – a search giant little-known outside of China – convinced ex-Microsoft standout Qi Lu to helm its efforts in AI, making him one of the highest-profile returnees of recent years.

Alibaba Group Holding Ltd’s coming-out party was a catalyst. The e-commerce giant pulled off the world’s largest initial public offering in 2014 – a record that stands – to drive home the scale and inventiveness of the country’s corporations.

Alibaba and Tencent now count among the 10 most valuable companies in the world, in the ranks of Amazon.com Inc and Facebook.

Chinese venture capital rivals the United States: three of the world’s five most valuable startups are based in Beijing, not California.

Tech has supplanted finance as the biggest draw for overseas Chinese returnees, accounting for 15.5% of all who go home, according to a 2017 survey of 1,821 people conducted by think-tank Centre for China & Globalisation and jobs site Zhaopin.com. That’s up 10% from their last poll, in 2015.

Not all choose to abandon the Valley. Of the more than 850,000 AI engineers across America, 7.9% are Chinese, according to a 2017 report from LinkedIn.

That naturally includes plenty of ethnic Chinese without strong ties to the mainland or any interest in working there. However, there are more AI engineers of Chinese descent in the United States than there are in China, even though they make up less than 1.6% of the American population.

Yet the search for returnees has spurred a thriving cottage industry.

In WeChat and Facebook cliques, headhunters and engineers from the diaspora exchange banter and animated gifs. Qi watches for certain markers: if you’ve scored permanent residency, are childless or the kids are prepping for college, expect a knock on your digital door.

Jay Wu has poached over 100 engineers for Chinese companies over the past three years. The co-founder of Global Career Path ran online communities for students before turning it into a career. The San Francisco resident now trawls more than a dozen WeChat groups for leads.

“WeChat is a good channel to keep tabs on what’s going on in the circle and also broadcast our offline events,” he said.

Ditching Cupertino or Mountain View for Beijing can be a tough sell when China’s undergoing its harshest Internet crackdown in history. But its tech giants hold three drawcards: faster growth in salaries, opportunity and a sense of home.

China’s Internet space is enjoying bubbly times, with compensation sometimes exceeding American peers’. One startup was said to have hired an AI engineer for cash and shares worth as much as US$30mil (RM119mil) over four years.

For engineers reluctant to relinquish American comforts, Chinese companies are going to them. Alibaba, Tencent, Uber-slayer Didi Chuxing and Baidu are among those who have built or are expanding labs in Silicon Valley.

Career opportunities, however, are regarded as more abundant back home. While Chinese engi-

neers are well represented in the Valley, the perception is that comparatively fewer advance to the top rungs, a phenomenon labelled the “Bamboo Ceiling”.

“More and more Chinese engineers who have worked in Silicon Valley for an extended period of time end up finding it’s much more lucrative for them career-wise to join a fast-rising Chinese company,”

says Hans Tung, a managing partner at venture firm GGV who’s organised events to poach talent.

“At Google, at LinkedIn, at Uber, at AirBnB, they all have Chinese engineers who are trying to figure out ‘should I stay, or should I go back’.”

More interesting than prospects for some may be the sheer volume of intimate data available and leeway to experiment in China.

Tencent’s WeChat, built by a small team in months, has become a poster-child for in-house creative licence.

Modern computing is driven by crunching enormous amounts of data, and generations of state surveillance has conditioned the public to be less concerned about sharing information than Westerners.

Local startup SenseTime for instance has teamed with dozens of police departments to track everything from visages to races, helping the country develop one of the world’s most sophisticated surveillance machines.

China’s 751 million Internet users have thus become a massive petri dish.

Big money and bigger data can be irresistible to those itching to turn theory into reality.

Xu Wanhong left Carnegie Mellon University’s computer science PhD programme in 2010 to work on Facebook’s news feed.

A chance meeting with a visiting team from Chinese startup UCAR Technology led to online friendships and in 2015, an offer to jump ship. Today he works at Kuaishou, a video service said to be valued at more than US$3bil (RM12bil), and commutes from 20km outside Beijing. It’s a far cry from the breakfast bar and lush spaces of Facebook’s Menlo Park headquarters.

“I didn’t go to the US for a big house. I went for the interesting problems,” he said.

Then there are those for whom it’s about human connection: no amount of tech can erase the fact that Shanghai and San Francisco are separated by an 11-hour flight and an even wider cultural chasm.

Chongqing native Yang Shuishi grew up deifying the West, adopting the name Seth and landing a dream job as a software engineer on Microsoft’s Redmond campus.

But suburban America didn’t suit a single man whose hometown has about 40 times Seattle’s population.

While he climbed the ranks during subsequent stints at Google and Facebook, life in America remained a lonely experience and he landed back in China.

“You’re just working as a cog in the huge machine and you never get to see the big picture.

“My friends back in China were thinking about the economy and vast social trends,” he said.

“Even if I get killed by the air and live shorter for 10 years, it’ll still be better.” - Bloomberg

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America vs China: odds narrowing

Leaders meet: A file picture showing Trump welcoming Xi to the Mar-a-Lago estate in West Palm Beach, Florida during the latter’s visit to the US recently. Xi has a growing economy too behind him, whatever the hiccups. Trump only promises one, without any clarity or logic. – AFP

THE contrast could not be greater. While United States president Donald Trump raves and rants – and belts this or that person – China’s president Xi Jinping looks measured and assured as he offers a global future to the world.

Xi is no angel of course, as his political opponents would know, but his system conserves and protects him, as Trump’s would not. If only Trump were the leader in a centrally controlled political order – but even then his temperament would blow it apart.

Leadership, like politics, is the art of managing the possible. Trump does not understand this, and does not know how. Xi does, knows why, and knows how.

He has a growing economy too behind him, whatever the hiccups. Trump only promises one, without any clarity or logic.

His plan to boost the American economy, based primarily on slashing corporate tax from 35 to 15%, is likely to flounder in an American Congress seriously concerned about its causing the fiscal deficit to balloon.

Already Trump has had to climb down from trying to secure funds from Congress for his dreaded border wall with Mexico in order to avoid budgetary shutdown in September.

The stock market has fallen back from the boost to the price of banks and industrial products following his election. Interest now has returned to what might be termed “American ingenuity stocks” such as Google, Apple and Microsoft on Nasdaq – a proxy for much that is great about America, which Trump’s immigration and closed-door policies threaten to destroy.

Meanwhile Xi has been rolling out his “Belt and Road” plans – something he first envisaged at the end of 2013 – for greater world connectivity and development, committing funds from China and the Asian Infrastructure Investment Bank, and engaging global financial institutions such as the World Bank.

Malaysia, for instance, will be an actual beneficiary with additional projects thrown in. China is Malaysia’s largest trading partner. But the US has not been a laggard, being Malaysia’s fourth largest trading partner. And indeed the US remains the largest foreign investor in Malaysia, both new investments and total stock.

A staggering statistic not often recognised is that total American investment in Asean is more than its investment in China, Japan and India COMBINED!

The point, however, is that this position is being eroded. Trump’s policies are hastening this process. Abandonment of the Trans-Pacific Partnership (TPP) means there is no American strategic peaceful challenge to the Chinese economic juggernaut in Asia-Pacific.

Balance is important to afford choice. Absence of choice means serious exposure to risk. Price, quality and after-service standards are affected, not to mention a new geostrategic economic underlining.

Over-dominance by China in the region is a price not only countries in the region will pay, something that most probably is on Trump’s mind. It is a price that America too will sooner or later have to pay.

China’s Belt and Road proposition is not without its challenges, of course. India is deeply suspicious of the connectivity with Pakistan which cuts across India-claimed Azad Kashmir, about 3000km of it.

The link to the Pakistani port of Gwadar, in southwest Baluchistan on the shores of the Arabian Sea, is seen by India as a Chinese presence at the entrance to the Indian Ocean and a hawk eye on the Indian sub-continent. With the Chinese also in Sri Lanka, India is circumspect on China’s Belt and Road initiative.

There have also been commentaries on some uneconomic linkages which extend right across the English Channel.

All these reservations, however, do not take into account the benefit of connectivity to economies, the time it often takes to get those economic benefits and, most of all, the patience, persistence and long view of history of China and its leaders.

One of the most striking things about the Belt and Road map is that America is not there. Of course, Xi Jinping does not preclude America just as much as the US did not say that China was not permanently excluded from the TPP. And of course, in the Old Silk Routes and shipping lanes, the New World – America – had not been discovered.

But in their revival, led by now rising and then ancient China after 150 years of national humiliation to the present time, there is the irony that the last three quarters of a century of America world dominance is on course to be marginalised, if not supplanted, by the old Eurasian world centred in an ancient civilisation.

Trump does not seem to understand history. The art of the deal is purely transactional. Short-tempered and short-term gratification does not a strategy constitute.

So we have leader, system and economic promise distinguishing the two leaders – and the two countries.

Instead of America first, what we are seeing is Trump hurrying America’s decline relative to a rising China.

We are not seeing a world changed from people wanting to be like a kind of American to being people wanting to be a kind of Chinese. Actually, the Chinese people themselves want to be like a kind of American, with all that wealth, influence and power.

What we are seeing is China – not America – leading the way to that desired, if not always desirable, end. It is China that is driving the next phase in the evolution of world economic development.

Under Xi Jinping, China appears to be heroically moving towards an epochal point in its Peaceful Rise. With Donald Trump, America is being led backwards and inwards, with all the problems of its governance now all coming out. It is in grave danger of losing in the peaceful competition.

Not knowing how to play that game – certainly under its current President – there remains the danger of the status quo power lashing out against the rising one.

The Greek historian Thucydides observed: “It was the rise of Athens and the fear that this instilled in Sparta that made war inevitable.”

A Harvard professor has studied what is now called the Thucydides Trap and found in 12 out of 16 cases in which this occurred in the last 500 years, the outcome was war.

There are many potential flash points against the background of China’s rise – the North Korean Peninsula and the placement of THAAD missiles in the south, the South China Sea – where Trump may temperamentally find cause to lash out. This is the trapdoor he might take the world down because of failure to compete peacefully.

By munir majid - crux The Star

Tan Sri Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.


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China needs strong core leadership: media survey

‘Transitional period demands strong administration’

Chinese people believe that a strong central leadership is indispensable for the rise of the country, and highly anticipate further confirmation of the role of the core leadership by President Xi Jinping during this period of historic significance, according to a poll recently released by a magazine affiliated with the People's Daily.

The survey, conducted by the People's Tribune, a magazine affiliated with the newspaper, through questionnaires, face-to-face and telephone interviews, as well as online polls between April 15 and September 8, interviewed 15,596 people living in cities and rural areas. The survey results were released earlier this month.

The main findings were that a strong central leadership as well as a pioneering figure is especially critical for a rising world power, and that as president and general secretary of the Communist Party of China (CPC) Central Committee, Xi, with full leadership qualities, is supported whole-heartedly by a wide range of officials and people.

To the question of why a country in a transitional period needs a strong central leadership, most respondents strongly agreed that it is vital to safeguard a country's sovereignty and national security, putting the approval rate at 4.50, on a 5-point scale from disagree to complete approval, the survey found. This is followed by the number of respondents who think that core leadership is as important to "guide the nation toward a lofty goal" or that it was "particularly important for a populous and multi-ethnic country."

This year, the necessity for strong leadership has been a theme expounded by many media organizations.

The Guangming Daily on October 9 published a commentary by Fan Dezhi, a senior official at the Party History Research Center of the CPC Central Committee, which asserted that "A strong core leadership is needed more than ever before to achieve the great dream of the renewal of the Chinese nation."

To promote the core leadership of the Party, the priority is to "conform with the CPC Central Committee, with General Secretary Xi Jinping as well as with the Party's theories, guidelines, principles and policies," read a commentary in the Qiushi Journal in March, the flagship magazine of the CPC Central Committee.

Social and political stability, which can be realized by a potent government backed by public support, is the prerequisite for a smooth transition and reform of any country, said Zhi Zhenfeng, a legal expert at the Chinese Academy of Social Sciences.

"Both the rise of great Western powers and the rapid development of developing countries needed a strong core leadership and powerful government," Zhuang Deshui, deputy director of the Research Center for Government Integrity-Building at Peking University, told the Global Times.

Zhuang cited the examples of Otto von Bismarck who unified Germany in the 19th century and the strong Japanese government that carried out Meiji Restoration to bring about its modernization and Westernization.

China should unwaveringly uphold the CPC's leadership if it hopes to realize a stable and sustainable development, Zhang Dejiang, chairman of the National People's Congress Standing Committee, said in March, adding that everyone should conform to the ideology and actions of the CPC Central Committee with Xi as general secretary.

"Since China faces complicated situations in different areas, coupled with a huge population, only a strong core leadership is able to coordinate the interests of different groups while taking full account of the majority of its nationals," Zhuang noted.

Zhi said a lack of consciousness of "the core" has made a few local officials and Party members fail to follow or strictly implement the policies issued by the CPC Central Committee.

Charismatic leadership

The People's Tribune poll found that the Chinese people are drawn to the charisma of Xi. The survey found that most respondents believe that Xi has leadership qualities, namely "strategic willpower with full confidence," "bravery to tackle problems head-on" and "intelligence to cure both the symptoms and root causes of problems." The list is rounded out by "top-level design with wisdom and philosophy" and "personal charisma to set an example for others."

When asked which trait is essential for a core leadership to give full play in reality, 79.13 percent of those surveyed said a "leader of integrity and ability."

In addition, the poll results showed that people from all walks of life highly anticipate the further confirmation of Xi's role as the core of the leadership.

Without releasing the specific data, the survey found that most respondents believe that officials that lacked "the consciousness of the core" would go astray and lose their sense of responsibility or discipline.

"Only by establishing authority in the CPC Central Committee can the Party and the nation be forceful. In this sense, firmly espousing Xi as the core is a matter of direction, principle and realistic needs," the magazine quoted anonymous officials who participated in the poll.

Therefore, we should further strengthen the consciousness of the core in the Party and across the country, improve intra-Party political life and the leadership system of the Party and the State, and further confirm Xi's core role in the critical rise of China, said the survey report. - Global Times.

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'Paper cat' Australia will learn its lesson

Around the announcement of the arbitration tribunal over the South China Sea, Australia was one of the most delirious countries. Canberra immediately supported the arbitration result and claimed China "must" abide by it, and also signed a joint declaration with the US and Japan. Australia has inked a free trade agreement with China, its biggest trading partner, which makes its move of disturbing the South China Sea waters surprising to many.


Australia is a unique country with an inglorious history. It was at first an offshore prison of the UK and then became its colony, a source of raw materials, overseas market and land of investment. This country was established through uncivilized means, in a process filled with the tears of the aboriginals.

Even with a scarce population and vast land, Australia has disputes with other countries over territory. It claims nearly 5.9 million square meters of land in the Antarctic, accounting for 42 percent of the continent. In order to back its territorial claims, Australia even brought up the activities of the British in the Antarctic as evidence.

Since The Antarctic Treaty was signed, all territorial claims over the continent were suspended. Canberra then raised another claims to demand the Antarctic continental shelf. It cited Article 298 of the UN Convention on the Law of the Sea to avoid a demand by arbitration by others.

Both historical rights and the exemption of arbitration as ruled in Article 298 of the UN Convention on the Law of the Sea were denied by the arbitration tribunal. Australia showed blunt double standards as if no one had a memory of what it did and said over the Antarctic.

Australia calls itself a principled country, while its utilitarianism has been sizzling. It lauds Sino-Australian relations when China's economic support is needed, but when it needs to please Washington, it demonstrates willingness of doing anything in a show of allegiance.

Analysts say that besides trying to please the US, it also intends to suppress China so as to gain a bargaining chip for economic interests. China must take revenge and let it know it's wrong. Australia's power means nothing compared to the security of China. If Australia steps into the South China Sea waters, it will be an ideal target for China to warn and strike.

Australia is not even a "paper tiger," it's only a "paper cat" at best. At a time when its former caretaker country the UK is dedicated to developing relations with China, and almost the whole of Europe takes a neutral position, Australia has unexpectedly made itself a pioneer of hurting China's interest with a fiercer attitude than countries directly involved in the South China Sea dispute. But this paper cat won't last. - Global Times

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