a sad day at Trivium
1. Saying goodbye to Fira
Hearts at Trivium are heavy today.
Last Friday, Fira Muradova — a member of Trivium’s design team — passed away in her home country of Uzbekistan due to complications from COVID-19.
Some context: Fira was a total sweetheart and a natural creative talent who was treasured by her family and co-workers.
Hers was the diligent hand behind many of Trivium’s client-facing products.
- If you’ve read any reports produced by Trivium in the last few months, you’ve enjoyed Fira’s work.
But she was so much more than that.
- Fira was also a loving and devoted wife and daughter.
Get smart: We will miss Fira deeply, and our thoughts are with all those she left behind.
Get smarter: We are here on this earth but a moment.
- If you can, hug your loved ones close today.
2. COVID-19 infections break out in Nanjing and beyond
In the past week, China reported an uptick in domestically transmitted COVID-19 infections.
The reason: A new outbreak taking root in Nanjing, capital of Jiangsu province.
From last Monday to Sunday, China reported:
- 92 new domestically transmitted confirmed cases, up from 16 in the previous 7-day period
- 32 new domestically transmitted asymptomatic cases, up from zero in the previous 7-day period
The Nanjing outbreak started at the city’s airport.
- On Tuesday, nine staff members of Nanjing Lukou International Airport tested positive for COVID-19.
The infections soon spread beyond the airport.
- By Sunday, Nanjing reported a city-wide total of 75 confirmed cases and 13 additional asymptomatic cases, all connected to the airport.
The virus has spread beyond Jiangsu: Five provinces have reported new infections that could be traced back to to Nanjing. They are:
Get smart: Nanjing is a megacity and transportation hub in the densely populated Yangtze River delta. An outbreak there could spread far and fast before being contained.
Get smarter: Behind each one of these data points is a real person battling a deadly disease.
3. At the center of the storm
On Thursday, the Party Central Committee and the State Council published a set of “Guiding Opinions on Promoting High-Quality Development of the Central Region in the New Era.”
Some context: The Politburo reviewed this document – which outlines a set of long-term development priorities for the region – in March.
- It was finalized back in April.
No coincidence: We’ve been laser focused on the massive flood relief efforts currently underway in central China’s Henan province over the past week….
…And it just so happens the document is filled with references to improving flood management and related infrastructure.
The region must:
- “Promote the construction of sponge cities and enhance…urban flood control and drainage.”
- “Accelerate resolution of weak links in flood control including…dangerous reservoirs [and] key flood diversion and storage areas.”
The document also calls for better mechanisms for inter-province policy coordination.
Get smart: Flood control is an obvious example of the need for provinces along watersheds to work together.
Get smarter: But it’s not the only one – everything from industrial supply chains to waste management to tourism will benefit from better coordination.
4. Nine years not in Tibet
It only took nine years.
Late last week, Xi Jinping finally visited Tibet – his first recorded trip to the region since taking over the Party in 2012.
Some context: By our count, Xi has conducted close to 100 domestic visits in the past nine years.
To be fair: Xi’s predecessor Hu Jintao didn’t visit the Tibet Autonomous Region (TAR) once during his 10-year tenure as Party leader.
- Then again, Hu had served as head of the TAR (1988-92), if mostly in absentia.
Xi’s itinerary (Al Jazeera):
- “Xi flew into the city of Nyingchi on Wednesday and took a train to the Tibetan capital Lhasa the following day along a section of the high-elevation railway being built to link the mountainous border region with Sichuan province.”
Official coverage of the visit gave a ringing endorsement of policy in Tibet (Gov.cn):
- “Practice proves, without the Chinese Communist Party, there would be no new China, and there would also be no new Tibet.
- “The Party center’s policy direction regarding Tibet is completely correct.”
Get smart: Lots of Tibetans preferred the “old Tibet.”
Get smarter: China’s assimilationist policies in Tibet and other ethnic minority areas are here to stay. That’s likely to further exacerbate ethnic tensions.
5. Wang Yang in the ‘Jiang
From Wednesday to Saturday, Wang Yang, chairman of the Chinese People’s Political Consultative Conference toured Xinjiang.
The themes of his trip:
First up, prosperity:
- In Aksu, Wang held a meeting on pairing assistance with officials from 19 provinces.
Some context: Pairing assistance describes Beijing’s long-standing efforts to channel financial, technical, and governance resources from China’s affluent seaboard to its less-developed interior.
Wang told officials to up their game (SCMP):
- “Pairing assistance for Xinjiang is a major political task.”
- “[F]unding [must go] to welfare, to the grass roots and key areas.”
- In Shihezi, Wang visited the Xinjiang Production and Construction Corps (XPCC).
More context: Founded in 1954, the XPCC is a paramilitary organization tasked with developing Xinjiang’s economy and ensuring stability.
Wang told the XPCC not to let its guard down (Xinhua 1):
- “The corps should…make maintaining stability and guarding the border its primary mission.”
Get smart: China’s heavy-handed assimilationist policies in Xinjiang have been widely covered, but Beijing also views economic development as key to ensuring stability there.
Get smarter: Between the US withdrawal from Afghanistan, and a recent terror attack on Chinese nationals in Pakistan, Beijing wants Xinjiang officials to spare no effort in securing the region’s borders.
6. The sanctions two-step
On Friday, the Ministry of Foreign Affairs (MoFA) announced retaliatory sanctions on six Americans and one pro-democracy organization.
Some context: On July 16, the White House released an advisory warning American businesses against operating in Hong Kong.
More context: In that same press release, the US Department of the Treasury added seven deputy directors of the Hong Kong Liaison Office – Beijing’s representative in the city – to the dozens of officials sanctioned for China’s activity there.
A MoFA spokesperson expressed displeasure (The Paper):
- “The [US’s] acts seriously violated international law and the basic norms of international relations…”
The American sanctionees include:
- Former Commerce Secretary Wilbur Ross
- U.S.-China Economic and Security Review Committee chair Carolyn Bartholomew
- Human Rights Watch China director Sophie Richardson
- The Hong Kong Democracy Council
Get smart: Beijing’s response was very similar to what we saw in March, after coordinated Xinjiang-related sanctions from the EU, US, UK, and Canada.
- That is, China levied countersanctions on groups and individuals who helped devise sanctions on China.
Get smarter: Beijing has talked a big game vis-à-vis counteracting the certain-to-continue US sanctions regime. Thus far, however, MoFA’s response has been much more bark than bite.
7. A death blow to shadow schooling
On Monday, the bloodbath continued for Chinese education companies’ HK-listed stocks.
Behind the nosedive: A policy document released over the weekend by the Party Central Committee and the State Council on reducing educational burdens.
The document takes aim at private education companies that provide courses related to core subjects for primary and middle school kids, by (Gov.cn):
- Banning the set-up of new companies in the sector
- Requiring existing companies providing online courses to apply for a new license
- Further requiring existing companies to re-register as non-profit organizations – meaning profits are not distributable to owners
- Restricting companies from providing tutoring during national holiday periods or over summer and winter school breaks
- Preventing them from accessing funding via capital markets, including IPOs and taking investments or seeking acquisition by public companies
- Restricting foreign investors from holding equities in education companies, including via VIE structures
Ouch: This will hit the EdTech sector hard – all of these measures will be applied to all existing private tutoring companies.
Get smart: One big factor behind the crackdown was the fast growth of the industry – it showed signs of unseating public schools as the primary provider of education, while largely remaining outside of regulatory oversight.
Get smarter: Tutoring companies purposefully fueled parents’ anxiety and amped up competitive pressure on kids in order to drive business.
- Investors were cashing in, and households were left footing hefty tutoring bills or fretting that their kids would be left behind.
The bottom line: This will completely change the landscape of the sector.
8. Xie Zhenhua previews upcoming net zero policy framework
On Saturday, China’s top climate envoy, Xie Zhenhua, teased the forthcoming carbon peak and carbon neutrality “1+N” framework.
- Xie said that the Leading Small Group (LSG) for Peak Carbon and Carbon Neutrality is formulating a carbon peak and carbon neutralization timetable, roadmap, and “1+N” framework.
Some context: “1+N” refers to the State Council’s template of a core reform guideline (the “1”) supplemented by numerous subject-specific guiding opinions (the “N”) – essentially the “snowflake method” of policymaking.
More context: The LSG was established in May to push China to meet its climate targets.
The deets: Xie said that the “1+N” framework involves policies to accelerate transformation and innovation in 10 areas, namely:
- Reducing fossil energy use
- Promoting industrial upgrading
- Promoting energy-saving, low-carbon buildings and facilities
- Building a green and low-carbon transportation system
- Developing the circular economy and improving resource utilization efficiency
- Promoting green and low-carbon technological innovation
- Developing green finance
- Introducing supportive economic policies and reform measures
- Improving the carbon market and pricing mechanism
- Implementing nature-based solutions
Get smart: Actual details are sparse, but that’s not the point.
Let it snow: The policy framework sets the broad strokes. Subsequent subject-specific guidelines flesh out the measures we can expect.