China
US-China strategic competition unchecked is headed for disaster
Author: Editorial Board, ANU
The world’s two largest powers are on a collision course. Strategic competition between the United States and China is ratcheting up, driven by both countries’ nationalism and psychologies of exceptionalism and righteousness which make it difficult to show weakness or back down in the face of perceived affronts to their dignity or interests.
Guardrails that protect against deterioration of bilateral relations, and even armed conflict, are being dismantled. Earlier hopes of cooperation, at least on global collective action problems like pandemic management and recovery and climate change, have all but disappeared. The inflationary and other economic costs of trade and technology decoupling are being disregarded.
There’s plenty of blame to go around. President Xi Jinping doing away with term limits and taking China down a path of illiberalism is no longer a matter for China alone given its share of the global economy and integration into it. The global market has never had to manage an economy of the size of China with a political system that’s daily becoming more opaque. China is no longer hiding and biding its time and its assertive behaviour and attempts to influence other countries have shown a nasty side of power.
For its part, the United States has traded leadership of the global commons for a policy of undermining the system, which it thinks it may favour China. The trade war has been escalated into full economic warfare with extraterritorial unilateral sanctions on what are said to be strategically important semiconductors that have the goal of crimping China’s technological rise.
Everything is now cast in zero-sum terms, even what one would think are obvious collective action problems like mitigating and managing the existential risks from climate change. There used to be offramps to strategic competition: even after the start of the Trump trade war, both the United States and China were willing to do deals like the Phase One trade agreement (as damaging as that was to other countries, including dependable US allies like Australia). Amazingly, the potential for cooperation and positive-sum competition seems to have deteriorated even further after Trump.
Neither Washington nor Beijing appears to recognise each other’s clear reaction function to the other. Either that or they do, and are deliberately trying to raise the temperature to induce the other into provocation that might justify a showdown.
The exercise of sovereign agency for its own sake — without respect for the wishes of the other party — might feel good. But it makes the world a more dangerous place. Positive outcomes are what matter, not conformance to the equivalence of some non-existent self-idealisation.
US House of Representatives Speaker Nancy Pelosi’s visit to Taiwan and former Australian Foreign Minister Marise Payne’s call for an investigation with ‘weapons inspector-like’ powers into the Wuhan coronavirus outbreak are both prime examples of achieving the opposite of a policy’s ostensible goal. Taiwan’s democracy is no safer after Pelosi’s visit. After Australia’s investigation proposal China predictably became defensive and Australia made it harder to secure Western involvement in investigations into the origins of COVID-19.
Chinese officials may believe they are aggrieved and need to better assert their position to the world. But wolf warrior diplomacy has been a disaster for China’s standing in the global community. China has managed to unite elites and ordinary people in the West and even much of the non-aligned world into hardening positions against it.
As Jia Qingguo argues in this week’s lead essay, ‘the kind of role China will play in regional security cooperation … does not depend on China alone’. There’s a reaction function in both directions that’s not difficult to see. ‘How China approaches regional security cooperation depends not just on China’s own actions, but on how the United States and its allies address China’s legitimate security concerns’. This does not mean, he quickly adds, that ‘what China says and does do not matter. It does’.
This suggests a role for US allies like Australia, Japan, South Korea and Singapore that are stuck in the middle of strategic competition across the Pacific.
Australia and Japan in particular have a fear of abandonment from their US ally that leads some of their leaders to egg on their American security guarantor as it intensifies strategic competition with China. It’s a dangerous game: in…
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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