China
Canada–China relations remain on the rocks
Author: John Kirton, University of Toronto
The deepening diplomatic dispute between China and Canada that began in December 2018 marks a fundamental change in their longstanding and relatively benign relationship. The conflict is having a damaging effect on both countries. The dispute also compromises China’s claim to be the new champion of the open, rules-based multilateral order, at a time when the United States is retreating from the role.
In December 2018, Canadian police arrested Huawei executive Meng Wanzhou in Vancouver at the request of the United States. The United States is seeking her extradition to answer questions over alleged violations of sanctions against Iran. China, for its part, has called the move politically motivated. They view the arrest as baseless discrimination against China’s businesses and citizens.
During her public extradition hearing in Canada, expected to last another year, she has had access to her legal team, lives in her Vancouver home and travels freely in the city during the day. Her treatment supports Canada’s claim that it is following the rule of law, even if some accuse the Trump administration of taking advantage of Canada. While the US request came through in the midst of the US–China trade war and at the height of security concerns surrounding Beijing’s influence over Huawei, Canada has been steadfast in following proper and transparent legal procedure.
China’s arrest of two expatriate Canadians soon after Meng’s arrest has not involved the same transparency or treatment. Besides the legal process and reasons for detention being shrouded in mystery, they have also had difficulty accessing legal advice, contacting family members and the reading glasses of one were seized. China also re-tried and imposed the death penalty on a Canadian it had previously sentenced to 15 years imprisonment for drug smuggling. China then arrested another Canadian on drug charges, along with 15 other foreigners.
At the same time as demanding Meng’s release, China has initiated escalating, discriminatory trade sanctions against Canadian agricultural products. And Chinese fighters recently ‘buzzed’ Canadian warships in international waters in the East China Sea. While China has not overtly linked these actions to the Meng case, the timing and language suggests strong connection.
Despite mounting pressure from Canada’s opposition Conservative party, Prime Minister Justin Trudeau’s Liberal government has achieved little in resolving the dispute. With the elephant standing in the room, he also sent the Minister for Small Business to China to foster trade. Trudeau managed to enlist the support of partner countries over the dispute, securing backing by March from the United States, the European Union and NATO. The G7 foreign ministers meeting in France on 6 April publicly declared, ‘we are deeply concerned by recent arbitrary actions of Chinese authorities, including the arbitrary detention and sentencing of foreign citizens’.
Trudeau then had US President Donald Trump intervene with Chinese President Xi Jinping on Canada’s behalf at the June Osaka G20 summit. Trudeau also persuaded Xi to resume bilateral discussions over the issue. The dispute will likely continue and even deepen if further steps and dialogue on constructing a path forward are not developed.
China risks losing Canada as a serious and prospective free trade partner and Huawei customer. Before December 2018, 55 per cent of Canadians favoured concluding a bilateral free trade deal with China. But in February 2019, a University of British Columbia poll showed that only 22 per cent had a favourable image of China, down 14 points from the previous year. By July, a Research Co. poll showed that more than two-thirds of Canadians rejected closer ties with China. Almost three-quarters supported the Trudeau government’s management of the Meng case and wanted Huawei banned from Canada’s 5G networks. A long road now lies ahead in the recovery of relations and the improvement of perceptions between the two.
The Canadian government has for now delayed its decision on whether to allow Huawei to supply 5G network equipment in Canada until after the general election this October. But Canada will likely join its other security partners who have denied Huawei 5G network access — the United States, Japan, Australia and New Zealand. These countries are pressing for unanimity among intelligence partners in general and from the United Kingdom in particular — the other remaining Five Eyes partner. Should they…
Business
China’s Golden Rooster Film Festival Kicks Off in Xiamen – Thailand Business News
The 2024 China Golden Rooster and Hundred Flowers Film Festival began in Xiamen on Nov 13, featuring awards, cultural projects worth 31.63 billion yuan, and fostering international film collaborations.
2024 China Golden Rooster and Hundred Flowers Film Festival Opens
The 2024 China Golden Rooster and Hundred Flowers Film Festival commenced in Xiamen, Fujian province, on November 13. This prestigious event showcases the top film awards in China and spans four days, concluding with the China Golden Rooster Awards ceremony on November 16.
The festival features various film exhibitions, including the Golden Rooster Mainland Film Section and the Golden Rooster International Film Section. These showcases aim to highlight the achievements of Chinese-language films and foster global cultural exchanges within the film industry.
On the festival’s opening day, a significant milestone was reached with the signing of 175 cultural and film projects, valued at 31.63 billion yuan ($4.36 billion). Additionally, the International Film and Television Copyright Service Platform was launched, furthering the globalization of Chinese film and television properties.
Source : China’s Golden Rooster film festival opens in Xiamen – Thailand Business News
China
Italy and China New DTA Set to Take Effect in 2025: Important Changes and Implications
Italy ratified an upgraded Double Tax Agreement (DTA) with China, effective in 2025, to reduce tax burdens, prevent evasion, and enhance investment. The DTA introduces modern provisions aligned with international standards, targeting tax avoidance and improving dispute resolution for Italian businesses.
Italy recently ratified the upgraded Double Tax Agreement (DTA), which will finally take effect in 2025. This agreement was signed in 2019 and was designed to reduce tax burdens, prevent tax evasion, and promote Italian investment in China.
On November 5, 2024, Italy’s Chamber of Deputies gave final approval to the ratification of the 2019 Double Tax Agreement (DTA) between Italy and China (hereinafter, referred to as the “new DTA”).
Set to take effect in 2025, the new DTA is aimed at eliminating double taxation on income, preventing tax evasion, and creating a more favorable environment for Italian businesses operating in China.
The ratification bill for the new DTA consists of four articles, with Article 3 detailing the financial provisions. Starting in 2025, the implementation costs of the agreement are estimated at €10.86 million (US$11.49 million) annually. These costs will be covered by a reduction in the special current expenditure fund allocated in the Italian Ministry of Economy’s 2024 budget, partially drawing from the reserve for the Italian Ministry of Foreign Affairs.
During the parliamentary debate, Deputy Foreign Minister Edmondo Cirielli emphasized the new DTA’s strategic importance, noting that the agreement redefines Italy’s economic and financial framework with China. Cirielli highlighted that the DTA not only strengthens relations with the Chinese government but also supports Italian businesses, which face increasing competition as other European countries have already established double taxation agreements with China. This ratification, therefore, is part of a broader series of diplomatic and economic engagements, leading up to a forthcoming visit by the President of the Italian Republic to China, underscoring Italy’s commitment to fostering bilateral relations and supporting its businesses in China’s complex market landscape.
The newly signed DTA between Italy and China, introduces several modernized provisions aligned with international tax frameworks. Replacing the 1986 DTA, the agreement adopts measures from the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project and the OECD Multilateral Instrument (MLI), targeting tax avoidance and improving dispute resolution.
The Principal Purpose Test (PPT) clause, inspired by BEPS, is one of the central updates in the new DTA, working to prevent treaty abuse. This clause allows tax benefits to be denied if one of the primary purposes of a transaction or arrangement was to gain a tax advantage, a move to counter tax evasion through treaty-shopping.
| This article was first published by China Briefing , which is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from offices across the world, including in in China, Hong Kong, Vietnam, Singapore, and India . Readers may write to info@dezshira.com for more support. |
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Business
China’s New Home Prices Stabilize After 17-Month Decline Following Support Measures
China’s new home prices fell for the 17th month in October, declining 0.5% from September, but slowing, indicating potential market stabilization amid supportive measures. Second-hand home prices showed mixed trends.
Decline in China’s Home Prices Stabilizes
China’s new home prices continued to decline in October for the 17th consecutive month, although the drop showed signs of slowing. Recent support measures from Beijing appear to be inching the market toward stabilization, as evidenced by a lighter decline compared to earlier months.
Monthly and Yearly Comparisons
According to the latest data from the National Bureau of Statistics, new home prices across 70 mainland cities fell by 0.5% from September, marking the smallest decrease in seven months. Year-on-year, prices dropped by 6.2%, slightly worse than the September decline of 6.1%. In tier-1 cities like Beijing and Shanghai, prices decreased by 0.2%, a smaller fall than 0.5% in the previous month.
Second-Hand Home Market Trends
Second-hand home prices in tier-1 cities experienced a 0.4% increase in October, reversing a 13-month downward trend. Conversely, tier-2 cities observed a 0.4% drop in second-hand prices, while tier-3 cities faced a similar 0.5% decline. Overall, recent trends indicate a potential stabilization in China’s property market.
Source : China’s new home prices slow 17-month decline after support measures kick in
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- China’s New Home Prices Stabilize After 17-Month Decline Following Support Measures
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