1. New market access negative list to limit private media activities
2. Just making sure we’re all on the same page
Save the Mother River, and rejuvenate China.
That was the message on Friday when the Party Central Committee (CC) and State Council (SC) released an environmental protection and high-quality development plan for the Yellow River basin.
- Improving upstream water conservation capacity
- Improving midstream water and soil conservation
- Promoting downstream wetland protection and ecological management
- Improving the allocation of water resources
- Ensuring the river’s long-term sustainability
- Strengthening pollution governance
- Implementing industrial upgrading and sustainable urban-rural development
And the hidden gem? A call to improve the mechanism for realizing the value of ecological products, including:
- Local exploration of ecological product accounting and measurement
- Central-to-local (vertical) and local-to-local (horizontal) compensation for environmental protection
- Allocation and cross-provincial trading of emission rights
Some context: In April, the CC and SC released a landmark document kickstarting efforts to create a framework for realizing the monetary value of nature, or what officials call “ecological products.”
Get smart: It’s still early, but “ecological products” could fundamentally change the way policymakers think about economic development by addressing the ingrained preference for economic growth over environmental protection.
Get smarter: Otherwise, most of the environmental efforts outlined above aren’t new – and that’s the point.
- This document is primarily intended to make sure everyone’s on the same page, and the Yellow River basin is better managed.
3. Back to work
Premier Li Keqiang got back to work on Friday, chairing the routine State Council executive meeting.
At the top of his agenda: Making sure the lights (and heating) stay on this winter.
ICYMI: Since mid-September, periodic power cuts have darkened homes and shut down factories across much of China.
Some context: Several factors are sparking power cuts, including enforcement of energy intensity targets and outright gaps in power generation capacity.
- The high price of coal – which pushed the cost of generating power higher than the price some generators receive from grid companies – is one of the biggest factors here.
Li listed off Beijing’s detailed plans for shoring up power supply over the next few months, including:
- Ensuring residential power and heating is up and running, particularly where it’s coldest in winter
- Boosting domestic coal production by any means necessary
- Giving coal power generators financial incentives, like tax breaks, to turn production back on
- Reforming coal power pricing mechanisms to allow power tariffs to rise when coal prices go up
- Building more wind and solar bases and attendant energy storage facilities
No one was waiting around for instructions from the State Council (Caixin).
- Inner Mongolia’s energy bureau was already back in the swing of things Thursday with an urgent notice calling for coal mines to step up production ASAP.
Get smart: Power price reform has been a political third rail for decades – it’s no surprise that it took widespread power cuts for Beijing to be able to touch it.
4. Revolutionary reminiscing
On Saturday, Xi Jinping did some reminiscing in a speech celebrating the 110th anniversary of the Xinhai Revolution.
History time: The Xinhai Revolution kicked off on October 10, 1911. It ended China’s last imperial dynasty and led to the establishment of the Republic of China on January 1, 1912.
Xi shared his top takeaway (Xinhua 2):
- “The past 110 years have shown us that to realize national rejuvenation, the Chinese people must have a strong force to lead us forward.”
- “That force is the Communist Party of China.”
And offered his recipe for future Chinese success:
- “On the journey ahead, we must fully promote patriotism…and strengthen the Chinese nation’s sense of community.”
Oh, and btw: That goes for ALL of China.
- Xi described moves aimed at “Taiwan independence” as the greatest obstacle to national success.
- ‘“The complete reunification of our country will be and can be realized,’ he stressed.”
Get smart: Despite recent weeks’ rising cross-strait tensions, Xi’s comments do not indicate an impending invasion or clash.
Get smarter: Xi demands reunification. But the Taiwanese people don’t want to be part of the PRC.
- How Xi squares that circle could prove to be his legacy-defining issue.
5. Talking with Tokyo
On Friday, Xi Jinping picked up the phone to call his newly installed Japanese counterpart, Fumio Kishida.
That was quick: With just five days on the job, that’s half the time Xi took before calling Kishida’s predecessor, Yoshihide Suga.
Their chat sounded downright pleasant.
- The pair agreed that maintaining stable relations is the best way forward – for both countries, and for the global community.
Xi offered a helpful reminder of how to do just that, saying (SCMP):
- “[Our] two countries…should properly handle major sensitive issues concerning history and Taiwan among others, [and] properly manage [our] differences.”
Kishida agreed, but noted that Japan would:
- “’[S]ay what needs to be said’ regarding China’s perceived shortcomings in upholding human rights and the rule of law.”
Get smart: In Beijing, Kishida is viewed as a moderate on China. That perception could potentially open up new possibilities to create a less contentious relationship.
Get smarter: That said, the underlying structural challenges to better bilateral ties remain firmly in place.
The bottom line: Japan – like several other Asia-Pacific countries – is strategically aligned with the US, but economically intertwined with China.
- How Kishida decides to walk the line between national defense and economic development will set the tone for bilateral relations during his term.
6. Talking trade again
On October 8, US Trade Representative Katherine Tai and Chinese Vice Premier Liu He held a second virtual meeting, following their first in May.
Top of the agenda: China’s economic model and industrial policy, and US tariffs on Chinese goods.
According to the official Xinhua readout (Gov.cn):
- “The Chinese side negotiated the cancellation of tariffs and sanctions, and clarified its position on China’s economic development model and industrial policies.”
According to the US side (USTR):
- “Ambassador Tai emphasized U.S. concerns relating to China’s state-led, non-market policies and practices that harm American workers, farmers and businesses.”
Both readouts also noted the pair reviewed implementation of the phase one trade pact, and acknowledged the importance of the US-China trade relationship to both countries – and the rest of the world.
Get smart: At least these talks didn’t seem to further harm the relationship, with both sides indicating additional consultations are on the board.
Get smarter: The US knows China isn’t about to budge from its state-led economic model just to get the US to drop tariffs.
- Instead, by continuing to push China to change, and highlighting China’s resistance to reform, the US is seeking to underscore the need for its own industrial policy.