driving the day
1. Self-strengthening 2.0
Yesterday, Xi Jinping held another symposium on the 14thFive-Year Plan (FYP).
The topic:Education, culture, healthcare, and sports.
Some context:This is the sixth symposium Xi has held to talk about the 14thFYP in the past two months.
Experts from the above-mentioned sectors offered their suggestions on a range of issues, including (Xinhua 1):
- Educational development and reform
- Cultural heritage and innovation
- The training of health workers
- Efforts to build China into a global sports power
Xi also asked universities to do their part in the drive for technological self-sufficiency(Xinhua 2):
- “Chinese universities must bravely shoulder heavy responsibilities… focus on national strategic needs, target key core technologies, especially the choke point technologies, and accelerate research.”
But according to Xi, ideological tightening will continue:
- “We must uphold the guiding position of Marxism…stick to the standpoint of Chinese culture, and adhere to the socialist core values in leading cultural construction.”
Why the emphasis on culture?
According to Xi:
- “To overcome…challenges on the road ahead, culture is an important source of strength.”
Get smart:Xi worries about the influence of pernicious foreign ideas on China’s impressionable young people.
Our question:Can science and technology really thrive when intellectual freedom is suppressed?
2. Bridging the gap
On Tuesday, Premier Li Keqiang wrapped up his two-day visit to Shanghai (see yesterday’s Tip Sheet).
Before leaving, Li managed to cram in a few more stops:
- He chaired a symposium at the Bank of Communications on financial support for the real economy and paid a visit to Shanghai Jiaotong University.
More details also emerged about his Monday visits.
This one caught our eye:At the SAP China Research Institute, Li discussed industrial robot quality and development with some software engineers.
- Li asked if there was a gap between Chinese robots and a German robots.
- Yes, said the engineers, Chinese robots still have some wayto go to be on par with their German peers.
Li wasn’t deterred by the frank reply, taking the opportunity to talk about opening (The Paper):
- “Opening up can make people realize that there is a gap, and only when they realize that the gap is there can there be room for improvement.”
- “In order to improve the level of a country’s manufacturing industry, it is necessary to expand opening-up and achieve mutual benefit and win-win results.”
Get smart: Li knows that China stands to gain by allowing foreign competitors and talent into its markets.
3. Everybody be cool
On Monday, senior Chinese and Indian military officials met to discuss the tense situation along their shared border.
Some context:Relations between the two neighbors have nosedived in recent months due to heightened tensions along their disputed border, including a clash in June that left 20 Indian soldiers dead and caused an unknown number of Chinese casualties (seeJune 17 Tip Sheet).
For the time being, though, it looks like cooler heads have prevailed.
According to a joint press statement published on Tuesday, the two sides have agreed to (MoD):
- “[E]arnestly implement the important consensus reached by leaders of the two countries, strengthen in-place communication and contact, avoid misunderstanding and miscalculation, stop adding troops to the frontline, and refrain from changing the in-place situation unilaterally and taking any actions that may complicate the situation.”
- “The two sides also agreed to hold the seventh commander-level talks as soon as possible, take practical measures to properly handle in-place issues and jointly maintain peace and tranquility in the border areas.”
Get smart:Chinese leaders will always take a hardline stance on territorial issues, but amid an increasingly turbulent international landscape, Beijing is just as happy to save its Himalayan chest-thumping for another time.
4. Ren Zhiqiang gets 18-year sentence
On Tuesday, real estate tycoon Ren Zhiqiang was handed an 18-year prison sentence along with a fine of RMB 4.2 million.
The charges against Ren included bribery, embezzlement, and abuse of power.
- Ren confessed to all charges and requested leniency. He will not appeal.
Some context: A vocal critic of Party leadership, Ren was known as “The Cannon” for his bombastic online presence.
- In March, a scathing missive attributed to Ren which criticized the government’s management of COVID-19 circulated widely.
- He was detained almost immediately after it appeared.
Why it matters:Deng Yuwen, formerly a top editor at the Central Party School’s paper Study Times, said it best (SCMP):
- “The Chinese political, business, and intellectual elites are watching the case closely, because Ren combined four identities in one. He is a princeling, a billionaire, a close friend with powerful people, and a public intellectual.”
- “He can move a lot more opinions and resources than most other dissidents.”
Get smart: Criticism of China’s pandemic response is a red line for the Party. There is real fear about controlling the message.
Get smarter:AnyChinesethat previously considered themselfto be untouchable will be more cautious in the wake of this case.
5. Risky business: semiconductors edition
As top leaders look to boost indigenous innovation, the Chinese semiconductor industry is having a moment (see September 21 Tip Sheet).
And local governments are vying for a piece of what is projected to be a very big pie(21st Century Biz):
- “The total scale of the integrated circuit industry [in Fujian, Jiangsu, Shanghai, Shaanxi, Zhejiang, Sichuan, Hubei, Tianjin, and Hunan] is expected to reach RMB 1.4 trillion in 2020.”
- “The total sales revenue of the industry in 2019 was only RMB 756.2 billion nationally.”
The government playbook for attracting advanced technology firms hasn’t changed much:
- “Local governments offer overly generous conditions in terms of land, tax subsidies, and cash rewards.”
And neither has the risky, almost Hobbesian playing field:
- “There have been reports of abandoned projects or bankruptcies, and many [local governments] have suffered great losses.”
- “In this game, the local governments often take over the abandoned projects, while the major shareholders retreat and start over somewhere else.”
Get smart:Local officials are eager to attract profitable business ventures andscore brownie points with their superiors for being proactive on policy.
Our question:Will local government exuberance translate into concrete gains for China’s semiconductor industry?