SwedCham China Insights for the Week of August 26 – August 30

SwedCham China Insights for August 26 – August 30

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Top news of the week:

China’s fiscal revenue falls in July as economic slowdown and property slump bite

26 August 2024

China’s national fiscal revenue contracted 1.9% year-on-year in July while income from land sales for local governments fell by the largest in two years. This comes at a time when the country is grappling with weak industrial production, sluggish consumption and a prolonged slowdown in the property market.

China promotes green finance along Yangtze River Economic Belt

27 August 2024

The Chinese government rolled out a set of guidelines on August 27 to support Yangtze River Economic Belt, its biggest economic zone, as the area pursues its green transition and turns to “higher-quality” growth – priorities shared by the country at large – via multilevel capital markets.

EU and China launch mechanism to facilitate industrial data flows

28 August 2024

The European Union and China launched the first discussions under a new system that aims to streamline cross-border data flows, the EU said in a statement on August 28. The mechanism aims to facilitate international transfers of non-personal data for European businesses while ensuring their compliance with Chinese data laws.

China issues white paper on energy transition

29 August 2024

On August 29, China's State Council Information Office released a white paper titled "China's Energy Transition" to document the country's successful actions and historic achievements in this field over the past decade.

Xi demands all-out efforts to carry out reform tasks

30 August 2024

On August 29, President Xi Jinping demanded all-out efforts to ensure the implementation of the country's reform tasks. Xi made the remarks while presiding over the sixth meeting of the Central Commission for Deepening Overall Reform, which he heads.

Insight of the week:

Jake Sullivan arrived in Beijing on August 27 for three-day meetings in his first trip to China as U.S. National Security Adviser. He met with President Xi Jinping, China’s top diplomat Wang Yi, and Zhang Youxia, vice chairmen of the Central Military Commission (CMC).

Jake Sullivan met President Xi Jinping in Beijing on August 29, wrapping up three days of talks aimed at easing friction between the two world powers ahead of November's U.S. election. Xi told Sullivan Beijing was committed to a stable relationship with Washington. Xi said that he hoped the US could see China’s development in a positive light and would work with China “to find a right way for two major countries to get along with each other”. “As two major countries, China and the United States should be responsible for history, for the people and for the world, and should be a source of stability for world peace and a propeller for common development,” according to Xi. According to the White House, the two sides discussed further implementation of the commitments President Biden and President Xi made at the November 2023 Woodside Summit, including on counternarcotics, military-to-military communications, and AI safety and risk. They also discussed cross-Strait issues, Russia’s war against Ukraine, and the South China Sea. The White House said after the meeting that the two sides were planning for a call between Xi and Biden soon.

Before meeting Xi, Sullivan had a rare discussion with a general considered by diplomats to be the president's key military adviser, Zhang Youxia, vice chairman of the CMC. Sullivan became the first US national security advisor in eight years to meet a vice chairman of China's top military body. Zhang Youxia reiterated China's firm position on the Taiwan question and warned against any military collusion between the U.S. and China's Taiwan region. The Taiwan question is at the very core of China's core interests, bedrock of the political foundation of China-U.S. relations, and the first red line that must not be crossed in China-U.S. relations, Zhang told Sullivan. Sullivan pushed for enhanced working-level communications between the countries' militaries. Sullivan told Zhang that both countries had a responsibility to prevent competition from veering into conflict or confrontation.

During the meeting between Wang Yi and Sullivan, they discussed the prospect of talks soon between Biden and Xi and shared perspectives on the conflicts in the Middle East and Ukraine, Chinese territorial claims from Taiwan to the South China Sea, and trade. "The key to the smooth development of China-U.S. interaction lies in treating each other as equals," Wang told Sullivan. The White House said the two held "candid, substantive, and constructive discussions". Wang and Sullivan have met five times over the past year-and-a-half, indicating the importance both countries place on the interactions despite differences on a wide range of issues.

The high-level reception that Sullivan received in China reflects the importance that China places on Sino-US relations. This reception not only indicates that both sides are willing to engage in face-to-face dialogue at critical moments to seek common interests, but also shows that despite the complex international situation, China and the US can still find points of cooperation to jointly maintain global stability and prosperity