China
Australia as an Asian power leaves no room for economic fantasy
Authors: Peter Drysdale and Shiro Armstrong, ANU
For Australia to join the great decoupling from China that some Americans and Australian security officials demand would bring devastating costs to Australia and to economic and political security across Northeast Asia. It fails to appreciate that exorcising our trade with China would also decouple trade from Japan, South Korea and Southeast Asia.
Australia and the world are grappling with the worst economic crisis since the 1930s. The economic, political and foreign policy choices that are made now will determine security, prosperity and stability for decades to come.
As an integral part of the shift of global economic gravity to Asia, Australia supplies two-thirds of all Northeast Asia’s externally procured iron ore, a large proportion of its other raw materials imports and over a quarter of all Japan’s energy needs. For its part, Asia constitutes almost two-thirds of Australia’s trade, China more than half of that.
The Asian economic success story is no consequence of imperial conquest or political suzerainty, communist or otherwise. It derives from Asian countries’ commitment to international trade rules and arrangements for regional economic cooperation that underpin the confidence in Asian integration into the global economy. That’s where Australian and regional prosperity and security has been found over the past 70 years. And that’s where its future is embedded.
Both Australia and China show signs of retreat from the commitment to openness that delivered this prosperity, including avoiding the worst of the global financial crisis and resilience through the COVID-19 crisis. China intervenes in barley and beef markets and now threatens Australian wine imports. Australia flirts with diversifying trade away from China and tightens regulations against foreign investment — largely aimed at Chinese investors — impeding a vital source of capital, technology and links to growing markets.
Australia’s huge bilateral economic relationship with China cannot be separated from China’s integration with other key partners in Asia. The China relationship is deeply interdependent with those relationships too. The manufactured imports that Australia secures from China include many Japanese, Korean and, yes, US and European brands. At least a fifth of the value in all Chinese exports is added in other countries, mostly Asia. Australian resource exports to Asia are the foundation of regional supply chains. Japan’s biggest corporations are major exporters of Australian produce to China, not just to Japan.
China is thus central to Australia’s future in Asia. Retreating from economic engagement with China into a world of Anglospheric stagnation and inviting deep regional insecurity is unwise. The United States may be willing to pay the price of decoupling from China, and expect others to, but it has more swivel room. National security without economic security would severely weaken Australia’s defences and diminish its diplomatic influence.
To avoid that requires a cool and determined Australian strategy. But those who are now defining China as an ‘enemy’ have not yet considered, let alone defined, such a strategy.
Australia now has to stand its ground with both the United States and China. That means engaging intelligently with China, eschewing both appeasement and needless confrontation. It also means continued distancing from the more extreme of US policies. Second, it will require the forging of a cooperative multilateral effort within the region that includes China.
That will only be possible if Australia finds its role as an Asian power.
Beijing needs to see Australia as a close ally and partner of the United States and Japan, as well as South Korea, ASEAN and India, but also a reliable and secure supplier of raw materials, agricultural products and global services such as education. Australia has to play a regional lead in genuine support of the WTO and plurilateral arrangements that strengthen a rules-based global economic order.
Alas, domestic political objectives in both countries are contributing to ramping up nationalism and defining the other as an enemy. These tensions are two-way. Beijing, isolated already by misdoings mostly of its own, will be a less reliable partner if these trends continue. Australia can reaffirm its guarantees of supply and markets as it did with Japan in an earlier time, providing a bedrock of secure trade in an increasingly tense environment.
There is a huge difference between coalitions for openness that…
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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