politics & policy
1. Xi chats up Rouhani
On Monday, Xi Jinping called up Iranian President Hassan Rouhani.
Xi kicked things off with some boilerplate expressions of goodwill in honor of 50 years of China-Iran relations (Xinhua):
- “China attaches great importance to its relationship with Iran, and is willing to…strengthen cooperation in various fields.”
- “Bilateral relations now stand at an important historical juncture to build on past achievements and forge ahead into the future.”
Some context: Ties between Beijing and Tehran have grown increasingly chummy of late, with the two having inked the Iran-China 25-year Cooperation Program back in March.
Xi then jumped into some meatier issues:
- “China supports Iran’s reasonable demands concerning the Joint Comprehensive Plan of Action (JCPOA) on the Iranian nuclear issue.”
- “China will…play a constructive role in pushing for an early and just settlement of the Palestinian issue, and is ready to work with Iran to strengthen communication and cooperation on regional and international affairs.”
Get smart: The Iran nuclear issue and the Israeli-Palestinian conflict are two geopolitical flashpoints where China has been keen to have a stronger voice.
Get smarter: China is increasingly positioning itself as a counterweight to Western interests and as an advocate for the developing world.
2. Li Keqiang calls on Zhoushan Port
On Monday, Premier Li Keqiang visited Ningbo Zhoushan Port in Zhejiang to talk more about commodities.
Commodities are a hot topic these days.
- On Wednesday, Li highlighted “unreasonable” commodity prices at a State Council meeting (see the Thursday’s Tip Sheet).
Zhoushan Port is a fitting place to talk commodities.
- It’s the world’s fourth-largest port.
- It handles more iron ore and crude oil than any port in China.
Li wants to the port to handle even more commodities:
- Last year, the port struck a deal with Brazilian mining giant Vale to build multiple “Valemax” shipping vessel berths that will increase annual iron ore handling capacity to 40 million tonnes.
There’s a geopolitical angle to all this:
- China imports nearly two-thirds of its iron ore from Australia, with whom it has increasingly testy relations.
- Those Valemax berths should help to enhance the competitiveness of Brazilian ore, helping Beiijng reduce its dependence on Canberra.
Get smart: Li’s visit is meant to send a signal that top leaders remain focused on reducing high commodity prices.
Get smarter: With the global recovery picking up speed, Li and co. are going to have a tough time putting a lid on commodity prices.
3. COVID’s positive side effect
A spate of recent mini COVID-19 outbreaks is having some positive side effects.
Some context: In the past week, China reported a total of nine new domestically transmitted confirmed cases and 14 new domestically transmitted asymptomatic cases in Liaoning, Anhui, and Guangdong.
These outbreaks are spurring more people to get vaccinated (NHC):
- As of Monday, China had administered a total of 527.25 million vaccine doses – up from the 421.99 million doses a week ago.
- That means the daily average of administered doses was 15.04 million last week – up from 12.71 million per day the week before.
This marks a dramatic improvement. Just a month ago, daily administered vaccine doses averaged only 3.54 million per day (see April 27 Tip Sheet).
Quick math: China has more than quadrupled its vaccination pace in just one month.
Get smart: A few weeks ago, China’s unofficial target of achieving herd immunity by the end of this year or early next year looked impossible. All of a sudden, it’s looking doable.
4. Don’t play with fire
On Monday, China’s Foreign Ministry spokesman Zhao Lijian had some words of warning for South Korea and the United States.
Those words (Gov.cn):
- “China has taken notice of the US-Korea joint statement and we express concern.”
- “We urge relevant countries to be cautious about their words and actions on Taiwan and not to play with fire.”
Some context: On Friday, following South Korean President Moon Jae-in’s visit to Washington, the US and South Korea issued a joint statement that touched on many a touchy subject in China, including:
- Stability in the Taiwan Strait
- Freedom of navigation in the South China Sea
- Human rights
- The multilateral “Quad” alliance
Zhao also had a reminder for the US:
- “There is only one set of [international] rules, the basic norms based on the United Nations Charter. No one country or group of countries is qualified to unilaterally define the international order.”
ICYMI: Thus far, just two foreign heads of state have visited Biden in DC – South Korea’s Moon and Japan’s Yoshihide Suga.
Get smart: That’s a pretty good indication that the US is looking to strengthen alliances in the Pacific.
Our question: Does China have a game plan for countering a re-engaged US in the Pacific?
5. HKMAO expands
On Monday, SCMP scooped that China’s Hong Kong and Macau Affairs Office (HKMAO) would add two new departments – one focused on propaganda and one on national security.
Some context: The HKMAO was upgraded in February 2020 when Xia Baolong – a state-level official – was brought in to the head the office (see February 13, 2020 Tip Sheet).
More context: Following the imposition of the Hong Kong National Security Law in June 2020, Beijing has been methodically tightening the screws on Hong Kong’s democratic opposition and broader political environment.
The HKMAO’s new propaganda department will be run by former HKMAO spokesman Yang Guang.
The department will:
- Disseminate official information
- Strengthen the delivery of press conferences
- Approve and coordinate Hong Kong and Macau journalists on the mainland
- Manage the “media scene” in the regions
The national security department will be run by former Hong Kong Liaison Office Legal Affairs Director and Tsinghua University Law School Dean Wang Zhenmin.
Details on the department’s day-to-day are forthcoming.
Get smart: Beijing has effectively silenced the pro-democracy movement in Hong Kong. Now they want to make sure it stays quiet.