China
Canada’s intercept in Australia’s loose China game
Author: Editorial Board, ANU
Engagement has been the bedrock of Canada’s approach towards China for over 50 years. In 1970, Pierre Trudeau, father of Justin, the current Canadian Prime Minister, was among the first Western leaders to open diplomatic relations with Beijing, before the visit of US President Nixon shifted the logjam on US–China relations in 1971. Canada’s co-location alongside its nuclear superpower protector in no way inhibited strategic initiative on China; indeed, it created the space for it.
Caught on the battle front in the crossfire between a more assertive and formidable China and a United States that has suddenly swung into action in the so-called ‘new Cold War’, Canada’s engagement strategy is now under pressure.
Canada’s predicament is encapsulated in the angst generated around the drawn-out detention of Michael Kovrig and Michael Spavor in China (the two Michaels) and the arrest of Huawei CFO Meng Wanzhou in Vancouver on an extradition order requested by the United States under the Trump administration. The fate of the two Michaels, no one is in any doubt, is entwined with that of Meng. The shift in Canadian public sentiment on China has been dramatic.
Polls and commentary on social and mainstream media reveal a gathering landslide of hostility and negative sentiment in the relationship. Concerns about Chinese behaviour extend from Xinjiang, Tibet and the origins of COVID-19, to the South China Sea, developments in Hong Kong and Chinese interference operations.
In our lead article this week Paul Evans observes that ‘the public mood is agitated and negative … The online world is toxic and dangerous terrain for those trying to explain — much less defend — Chinese actions. A whiff of McCarthyism floats in the air as some insist on loyalty tests based on views of Chinese communism. “Elite capture” is offered as an explanation of how academics, businesspeople and politicians who support engagement are witting or unwitting CCP agents … Departments and agencies are quietly examining Huawei’s role in the 5G network, measures to protect intellectual property and strategic resources, university collaborations, and military deployments in contested waters’. Australian readers will relate to this drift.
As Trudeau’s Liberals head towards an early election on the wave of their success in managing the COVID-19 crisis, Evans speculates that the Conservative opposition might try to wedge the government over China.
The Conservatives’ election manifesto is detailed, calling on the country to work with democratic allies and friends to face down Chinese Communist Party (CCP) threats to Canadian institutions and values, plus advance freedom, democracy, human rights and the rule of law abroad.
Despite the hostile atmospherics, Trudeau has continued to seek balance in Canada’s dealings with China. He has deflected charges that his government is soft on China, using hard language to denounce specific Chinese actions (‘hostage diplomacy’ and ‘arbitrary detentions’) and rallying support from friends and allies to pressure Beijing on the two Michaels, Xinjiang and Hong Kong. The Canadian government avoids blanket criticisms of the CCP and rhetorical overreach. If Trudeau has moved beyond engagement, he is yet to fully articulate an alternative.
Despite the fractiousness in Canada’s political relations with China, the economic relationship is surging back after the initial COVID slump. In a thinly disguised political move, China imposed quarantine restrictions on Canadian exports of canola and soya beans in March 2019. Exports of those commodities worth US$3.3 billion in 2018 slumped by 81 per cent in 2019. While the dispute is proceeding through the WTO, oilseed exports have recovered 58 per cent in the first six months of this year and Canadian canola exports have found their way into the Chinese market via third countries. Exports across the range of Canadian exports to China have increased by 23 per cent in the same period and are running above their 2018 peak. Notably, Canada’s barley exports to China are up 238 per cent and coal 185 per cent, helping to fill the gap left by Australia’s being muscled out of these markets.
Many of the issues in Canada’s relationship with China resonate in Australia. Yet the two countries have managed the diplomacy of the relationship quite differently with implications for economic outcomes. As Sourabh Gupta points out in a related article this week, ‘on the substantive issues that have eroded Australia–China ties…
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
- U.S. national debt is its Achilles’ heel, but China sees it as an opportunity
- Business Update: Southern Sun Reports Earnings Growth; China Stimulates Property Market – News24
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