1. COVID hits Fujian
2. Das Ende einer Epoche
A toast to eine geschätzte Kollegin.
On Friday, Xi Jinping held his likely last call with German Chancellor Angela Merkel, two weeks ahead of the German election to determine her successor.
- Their chat came just after Xi’s call with US President Joe Biden.
- The contrast in feeling couldn’t have been clearer.
Xi to Biden: “Due to the US policy on China, the China-US relationship has run into serious difficulty.”
Xi to Merkel: “Madam Chancellor is actively committed to promoting practical cooperation and friendly exchanges between Germany and Europe with China, which I highly appreciate.”
Merkel, meanwhile, poured one out for the “mutually beneficial and win-win” EU-China investment deal, at least according to the Chinese readout.
- That is, the deal the European Parliament put on ice after tit-for-tat sanctions over the treatment of Uyghurs in Xinjiang.
The German readout, however, made no mention of the still stalled, still controversial Comprehensive Agreement on Investment.
- It stuck to easier issues – like Afghanistan.
Get smart: No one quite knows where Sino-German ties will head under the next chancellor.
- But to us, it looks like Xi is trying to play nice and reinforce Sino-German ties into the next German administration.
3. More money to reach ecological civilization
Stump up to save China.
On Sunday, the Central Committee and State Council issued opinions on improving China’s ecological protection compensation system.
Some context: These opinions are all about the use of transfer payments and/or market-based transactions to compensate entities responsible for protecting rivers, natural forests, wetlands, and more.
- They are also about carrying out Xi Jinping Thought on Ecological Civilization. Obviously.
Local governments can expect more financial support:
- The central government will increase the scale of transfer payments to boost local spending on ecological protection
- Local governments along shared bodies of water are encouraged to explore compensating one another for water protection efforts
And these aren’t just conventional transfer payments.
The opinions stress the importance of market-based transactions, including:
- Encouraging inter-regional water rights trading
- Implementing payment for and trading of pollutant discharge rights
- Accelerating the construction of a national energy rights and carbon emission rights trading market
- Incorporating voluntary emission reduction projects for forestry, renewable energy, and methane utilization into the national carbon emission trading scheme
Get smart: Compensation from the central government will come more easily than compensation from, and among, local governments.
- Given the number of jurisdictions involved, and diverging interests, central government intervention is very likely.
Get smarter: Expanding the scope of carbon emission rights trading will take years as Beijing irons out the kinks.
- Still, these slow-and-steady environmental protection efforts are welcome.
Xinhua: 中共中央办公厅 国务院办公厅印发《关于深化生态保护补偿制度改革的意见》
4. Invite to a garden party
Here we go again.
Last Thursday, MIIT summoned a bunch of major internet platform companies to a big meeting.
All the big names were there: Including Alibaba, Tencent, ByteDance, Baidu, Huawei, Xiaomi, Momo, 360, and NetEase.
On the agenda: Hyperlinks.
- You know, the bits of blue underlined text that magically transport you across the web…
Some context: For the past decade, two of China’s biggest internet platforms – Tencent’s WeChat and Alibaba’s Taobao – have been blocking each other’s links in an attempt to hang on to more traffic and revenue.
- The practice, known as building “walled gardens,” became widespread across the industry.
MIIT told everyone to tear down the walls:
- Platforms have until September 17 to unblock each other’s hyperlinks
- Those that fail to comply will face administrative penalties
ICYMI: MIIT began pushing companies to stop blocking each other’s links back in July.
- This is the first time the regulator set a deadline for big internet companies to comply.
Get smart: Beijing wants big tech to work together and build out one big happy innovation ecosystem that benefits large and small companies alike.
Get smarter: Ordering platforms to tear down these walls is easy – but delivering more meaningful integration and access is much harder.
What we’re wondering: We’re not sure policymakers have thought this all the way through. What if tearing down walled gardens allows big platforms to outcompete the small companies that were previously protected inside them, and become even more dominant?
5. China keeps its ion the prize
Check out the Gansu game changer.
This month, China is kicking off tests of its experimental thorium-based molten salt nuclear reactor.
- With this reactor, China has a solid chance of commercializing a powerful new zero-emissions energy source.
We know – the name’s got a lot of adjectives. Just know that this salty reactor packs some sweet features.
- It doesn’t depend on water, letting it operate more or less anywhere – like the Gobi desert, where it’s being tested, near the city of Wuwei, in Gansu province.
- Its fuel – thorium – is much more naturally abundant than uranium.
- It’s safer than traditional nuclear, with limited potential for radiation dispersal.
The kicker? Thorium doesn’t decay to plutonium – limiting proliferation risks. That means this reactor could be easier to build overseas.
- Belt and Road, anyone? (History note: In the pre-nuclear age, Wuwei was a key Silk Road stop.)
Get smart: This month’s tests will indicate whether China’s experimental reactor can be commercialized – and leveraged for net zero.
Get smarter: Temper your expectations – the next nuclear energy revolution has been “just around the corner” for decades.
- But with Xi Jinping gunning for net zero, the times may be a-changin’.
Nature: China prepares to test thorium-fuelled nuclear reactor