China
ASEAN stress-tested by big power rivalry
Author: Editorial Board, ANU
The relationships between ASEAN, China and the United States are under pressure in a world in which the global order is changing dramatically. This change threatens Asia’s shared prosperity and security. It is a product of the big shifts in the structure of global power driven by the success of that order, with the rise of China seen within the United States and elsewhere no longer as a cause for celebration but of deepening disquiet. The pressure has been intensified by the COVID-19 pandemic and its impact on big power tensions and the global economy.
ASEAN has played a central role as a fulcrum around which big power jostling in the region has been stabilised. ASEAN’s cooperation arrangements have served as an effective mechanism for engaging and managing big power interests in the region. But can ASEAN and its regional frameworks continue to remain resilient enough in dealings with the two big regional powers as they have increasingly begun to cast themselves as strategic competitors?
The rise of China as a world economic power has increased its confidence and influence in the region, including vis-a-vis ASEAN and ASEAN’s member states. Two areas in which China’s growing power directly impacts ASEAN members are on the territorial and navigation issues in the South China Sea and in responding to the large-scale financial assistance that China has offered through its Belt and Road Initiative. China’s growing power is matched with a geopolitical ambition that now encompasses a broader conception of its maritime security interests, including over large areas of the South China Sea that border on ASEAN member states.
Meanwhile, ASEAN confronts the problems that result from the radical changes in the foreign and international economic policies of the United States since Donald Trump assumed the US presidency. President Trump’s ‘America First’ policy and his administration’s rationalisation of trade protectionism in response to American job losses associated with offshoring has undermined commitment to the open multilateral trade regime. Trump’s attack on the WTO’s dispute settlement mechanism, his espousal of bilateralism and renegotiation of NAFTA in North America and KORUS with Korea, his withdrawal from the Trans-Pacific Partnership and his effectively launching all-out trade and technology war with China have rocked the foundations of the international economic system on which ASEAN relies. Mr Trump’s disrespect of its alliance relationships in the region piles on additional uncertainty in Asia about US reliability.
There are five major theatres in which these gathering economic and political forces affect ASEAN and its dealings with the major powers: in the South China Sea over territorial and freedom of navigation issues; over the Chinese Belt and Road Initiative; in the escalating trade and technology war between the United States and China; in the response to the United States’ free and open Indo-Pacific initiative (FOIP); and in consequence of the COVID-19 pandemic.
These developments present ASEAN and the heavily economically-integrated states of East Asia, who have long relied on rules-based, step-by-step diplomacy and multilateralism, with stark choices. They are choices that will put heavy internal pressure on ASEAN with its members’ variegated structure of political and security ties with the United States. They are pressures that have the potential to drive wedges among ASEAN members but also between ASEAN and its dialogue partners, in the ASEAN+6 group and the ASEAN+8 (East Asia Summit) processes and inflict unrecoverable damage upon the ASEAN-led East Asia integration enterprise. The cement of Asia’s intense economic ties with China is susceptible to corrosion by the conflicted political relations of some regional states with China and, more importantly, being jack-hammered asunder by the United States through bilateral heavying. Unless it is resisted and an alternative strategy is articulated, a US strategy bent on destroying economic interdependence with China is likely to take East Asian interdependence in its path.
ASEAN enjoys some advantages in meeting the present geopolitical challenge that it faces, as David Camroux argues in this week’s lead essay. In particular, it serves as enhancer, legitimiser, socialiser, buffer, hedger and lever of its member states’ role in regional and international affairs.
‘The hedging benefits of membership’, says Camroux, ‘provide intra-regional solidarity to international balancing…
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
- China’s Golden Rooster Film Festival Kicks Off in Xiamen – Thailand Business News
- Italy and China New DTA Set to Take Effect in 2025: Important Changes and Implications
- China’s New Home Prices Stabilize After 17-Month Decline Following Support Measures
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