China is facing crises on multiple fronts. However, when it comes to the upcoming Party Congress, the show must go on.
According to Wu Qianyu of the Shanghai Health Commission, “the pandemic situation is not optimistic, both domestically and abroad.” He said that Shanghai citizens were advised not to leave the city during the mid-Autumn festival holiday this weekend. This will hit the 1 October National Day holiday week which was a major break featuring a great deal of tourism and travel. Even as the world is learning to live with COVID through a regime of mass vaccination, China’s zero-COVID approach remains to be of imposing drastic lockdowns, quarantines and mass testing to isolate infections. China’s political approach is that its way of handling COVID has been superior because it has avoided mass deaths, but the problem remains that its population is not fully vaccinated and that it has no strategy for coping with the mutating virus that is becoming more infectious. China has inoculated most of its population with double doses of CoronaVac and Sinopharm vaccines. However, data suggests that the immunity obtained from two doses rapidly declines and the protection for older people is limited.
China’s political approach is that its way of handling COVID has been superior because it has avoided mass deaths, but the problem remains that its population is not fully vaccinated and that it has no strategy for coping with the mutating virus that is becoming more infectious.
In the meantime, three government ministries dealing with agriculture, rural affairs, and water resources issued a notice, at the end of last month, saying that the drought and high temperatures pose a severe threat to the autumn harvest as they are affecting the Yangtze basin and southern China—the main rice-producing areas of the country. The industrial cities of Shanghai and Chongqing have imposed power cuts because of the increasing use of air conditioners to cope with the heat. Besides urging people to use their water carefully, the Chinese have resorted to cloud seeding to increase precipitation.
The industrial cities of Shanghai and Chongqing have imposed power cuts because of the increasing use of air conditioners to cope with the heat.
All this comes after it has become clear that the semiconductor efforts were not going anywhere. Indeed, Xi’s meeting has come after several investigations led to corruption charges against many senior officials and a bailout of one of its top semiconductor firms, the Tsinghua Unigroup. The Chinese have spent tens of billions of dollars on the semiconductor industry but have got meagre results. What has angered officials is that this fiasco of sorts has occurred at a time when the US has been tightening its restraints on China. Xi Jinping had put down more than US$100 billion in the last decade in trying to build a domestic semiconductor industry. Now, the key funding body—the National Integrated Circuit Industry Investment Fund, aka the “Big Fund”—is also being investigated. But clearly, the Chinese have no intention of backing off and are doubling down on their plans. China Talk, an American technology podcast, recently published a translation of a top Communist Party of China scientist providing a more realistic Chinese appreciation of the pressure they face in the wake of their estrangement from the US. Zhang Yuzhuo is an energy scientist and the party branch secretary of the China Association of Science and Technology (CAST) whose job is to promote the party line amongst scientists, lead its initiatives in Science and Technology and popularise scientific literacy. Zhang is the senior-most CCP official in the outfit. In a speech translated by China Talk, the Chinese scientist makes some key points including how American containment is affecting China’s STEM efforts in multiple ways. Zhang identified “targeted containment” which involves the US using its friends and allies in applying specific export controls.
Xi’s meeting has come after several investigations led to corruption charges against many senior officials and a bailout of one of its top semiconductor firms, the Tsinghua Unigroup.
China, even now, lacks the ability to make S&T breakthroughs because of its outdated systems which need reform. He bluntly said that “We lack major theoretical breakthroughs and leading original achievements” noting that there were other bottlenecks that hampered innovation. He went on to add that as of now “We lack strategic scientists and top technicians, training for young talent, and a reserve of outstanding engineers.” This is as blunt as a party hack can be, but it sums up China’s dilemma. Meanwhile, the geopolitical tensions between the US and China are generating its own waves in the form of a steady exodus of technology companies from China. This is in addition to the supply chain disruptions that took place in 2020 because of COVID. Most companies are employing the China-plus-one strategy, where the companies establish a foothold in another country, more often than not, Vietnam, and then steadily disengage from China. This seems to be the for Apple as it chose to establish a manufacturing facility for iPhones in India, whilst its rival Google is setting up a unit in Vietnam. The tensions have been rising especially due to Nancy Pelosi’s visit to Taiwan, making many American companies even more insecure in China. These troubles are unlikely to affect the tone and tenor of the upcoming Party Congress whose programme has probably already been scripted in advance. Xi’s supremacy is secured and it is no surprise that the slogan of the times is the need to uphold the “two establishes”—to establish the status of Comrade Xi Jinping as the cores of the Party’s Central Committee and to establish the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for the new era.
Most companies are employing the China-plus-one strategy, where the companies establish a foothold in another country, more often than not, Vietnam, and then steadily disengage from China.
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Manoj Joshi is a Distinguished Fellow at the ORF. He has been a journalist specialising on national and international politics and is a commentator and ...Read More +