1. Bi-latte-ral relations
The socialist market economy and global capitalism makes for strange bedfellows.
On Thursday, Xi Jinping wrote a letter to Starbucks CEO Howard Schultz.
In the missive, Xi urged the coffee behemoth to help mend tattered ties between Beijing and Washington (Bloomberg):
- “I hope Starbucks will make active efforts to promote China-U.S. economic and trade cooperation and the development of bilateral relations.”
- “China…will provide a broader space for companies from all over the world, including Starbucks and other American companies, to develop in China.”
Some context: Xi’s letter was in response to a January 6 message from Schultz, congratulating China on achieving its goal of creating a “moderately prosperous society.”
In his response to Xi’s response, Schultz expressed his hope that Chinese citizens would use some of that moderate prosperity to buy more bean juice (CGTN):
- “China has long been an important part of the Starbucks story.”
- “I truly believe Starbucks best days are ahead in China.”
Get smart: Xi is signaling that despite all the recent Sino-American unpleasantness, US companies are welcome, nay, encouraged to expand their operations in China.
Get smarter: Foreign firms like Starbucks can’t help but be tantalized by Beijing’s plans to boost incomes and domestic consumption as per the dual circulation strategy.
2. The rising East
At the final session, the Party’s ideological czar, Wang Huning, had three instructions for senior officials (Xinhua):
- Understand the big picture.
- Address “unbalanced” development.
- Improve the country’s ability to survive, compete, and sustain itself.
On Friday, Chen Yixin, secretary general of Central Political and Legal Affairs Commission, debriefed his colleagues on the workshop’s key points (Sohu).
Chen went all big picture:
- The pandemic will have a profound impact on the international order.
- The US will persist in trying to contain China.
- The East is rising while the West is declining.
Get smart: Xi has long held the view that the balance of power in the international order is shifting in China’s favor (see the June 25, 2018 Tip Sheet).
What that means: Xi and the top leadership are increasingly confident in their political system. That means we should not expect dramatic policy shifts any time soon.
3. CPPCC preps for Two Sessions
On Thursday, Chinese People’s Political Consultative Conference (CPPCC) Chairman Wang Yang presided over a meeting of CPPCC chairpersons.
Top of the agenda: Preparations for the CPPCC’s annual session.
Some context: Together, the annual sessions of the National People’s Congress and the CPPCC are known as the Two Sessions.
- The Two Sessions is an important annual political event, convened to approve the government’s work report, which signals policy priorities for the year to officials at all levels as well as the business community.
The meeting suggested that this year’s session will:
- Be dedicated to the formulation of the 14th Five-Year Plan
- Kick off on March 4
Some context: Last year, the Two Sessions was postponed due to the COVID-19 epidemic.
Get smart: Despite recent larger-scale outbreaks of COVID-19 in in northern China, the top leadership is signaling that they’ve got things under control by scheduling the Two Sessions for just seven weeks from now.
4. Brothers in arm jabs
On Wednesday and Thursday, Foreign Minister Wang Yi was in Indonesia for meetings with his Indonesian counterpart, Retno Marsudi.
Some context: Wang is on a six-day tour of Southeast Asia which also includes stops in Myanmar, Brunei, and the Philippines.
On the agenda: Boosting trade ties.
- Marsudi asked Wang about increased market access for key Indonesian exports like fish, fruits, and palm oil.
- Wang said Beijing would work with Jakarta to reduce trade barriers, expand Chinese investment in the country, and implement the terms of the Regional Comprehensive Economic Partnership, the massive 15-nation Asia-Pacific trade agreement signed in November (seeNovember 16 Tip Sheet).
Something else interesting happened during Wang’s visit.
- Indonesian President Joko Widodo personally kicked off the country’s COVID-19 vaccination drive by getting a COVID-19 jab courtesy of China’s own Sinovac Biotech.
Wang was stoked:
- He said that the vaccine’s rollout highlighted the “brotherly relations between the two countries.”
Get smart: Wang’s Southeast Asian tour is part of an effort to solidify Beijing’s regional ties before the start of the Biden administration.
Get smarter: Perceptions of China may have tanked in the West, but Beijing is winning friends in the developing world.
5. The rural challenge
On Thursday, China reported 135 confirmed and 55 asymptomatic new domestically transmitted cases of COVID-19.
Most infections were concentrated in three provinces:
- 90 confirmed and nine asymptomatic cases in Hebei
- 43 confirmed and 31 asymptomatic cases in Heilongjiang
- 14 asymptomatic cases in Jilin province
But new cases are cropping up in other parts of the country:
- Guangxi and Shaanxi have each reported one confirmed case.
There’s a pattern: Infections are concentrated in rural areas.
On Thursday, Vice Premier Sun Chunlancalled for greater efforts to:
- Monitor the health of migrant workers returning to villages
- Report fever patients and suspected cases in rural clinics within two hours
- Reduce social and religious gatherings in rural areas
Feng Zijian, vice director of the Chinese Center for Disease Control, highlighted the challenges in containing COVID-19 in rural areas:
- Poor healthcare infrastructure makes early detection difficult.
- Rural areas lack adequate quarantine facilities.
Get smart: With migrant workers about to return to their villages to celebrate Chinese New Year, these rural outbreaks couldn’t have come at a worse time.
The bottom line: China’s COVID-19 containment efforts will hinge on authorities’ ability to halt the spread of the disease in rural areas.