Hong Kong Offers $120,000 Bounties for Human Rights Dissidents Living in US, Australia, UK

Leaders of democratic nations respond to brazen extradition attempt

Photos of eight activists who have been issued arrest warrants over national security are displayed during a press conference in Hong Kong on July 3, 2023. (Joyce Zhou/Reuters)

By Daniel Y. Teng

July 3, 2023   Updated: July 5, 2023

 

Hong Kong police are offering $1 million (US$127,650) bounties for information on eight human rights dissidents currently residing in the United States, UK, and Australia.

On July 3, the National Security Department of the Hong Kong Police Force issued arrest warrants for the eight individuals, alleging they had contravened the National Security Law.

The law was passed by Beijing’s rubber-stamp legislature in 2020 and received widespread criticism for eroding the long-running “one country, two systems” model that ensured British-style rule of law over Hong Kong.

The eight individuals were accused of “endangering” Hong Kong’s national security—more specifically, the allegations of “incitement to secession, subversion, incitement to subversion, and collusion with a foreign country.”

Chief Superintendent of Police (National Security) Li Kwai-wah speaks during a press conference to issue arrest warrants for eight activists in Hong Kong on July 3, 2023. (Joyce Zhou/Reuters)

A Hong Kong police spokesperson claimed the National Security Law granted authorities the power to pursue individuals located outside of the city.

Meanwhile, Steve Li (Li Kwai-wah), chief superintendent of the HK Police, vowed authorities would “not stop chasing” the dissidents.

“They have encouraged sanctions … to destroy Hong Kong and to intimidate officials,” he told reporters in comments obtained by Reuters.

While Hong Kong’s chief executive, John Lee, vowed to pursue the eight activists indefinitely.

“The only way to end their destiny of being an abscondee who will be pursued for life is to surrender,” he told reporters. “We’ll be pursuing the abscondees’ criminal responsibilities for life until they surrender themselves.”

Those subject to the bounties include Australian citizen and lawyer Kevin Yam, former HK politicians Ted Hui and UK-based Nathan Law (Law Kwun-chung), as well as other prominent activists Elmer Yuen (Yuan Gong-yi), Dennis Kwok (Kwok Wing-hang), Mung Siu-tat, Lau Cho-dik, and Anna Kwok (Kwok Fung-yee).

Dissidents Respond

In response, Nathan Law said he was also “wanted” for other alleged contraventions of the National Security Law but accused authorities—now under the sway of the Chinese Communist Party—of bending the rule of law to suit their own purposes.

“These charges are classic examples of abusing the concept of ‘national security,’ pushing its definition to an extreme to suppress dissident voices,” he wrote on Twitter.

“In civilized countries, the right to peaceful political advocacy should be protected. That’s what all the ‘wanted’ individuals do. I urge National Security Bureau to disclose any evidence of my alleged collusion with foreign forces,” he continued.

“I have not accepted any foreign govt funding, nor am I employed by any govt agencies. I don’t accept any commands or orders. If meeting foreign politicians, attending seminars, and hearings are ‘colluding with foreign forces,’ a lot of HK officials should be in legal trouble.”

1. For the past years, the National Security Bureau has been accusing me of violating the National Security Law. Today, the specifics of the were revealed: Incitement to secession, collusion with foreign forces to endanger national security.
One million HKD bounty is warranted. pic.twitter.com/KV7FIogULP

— Nathan Law 羅冠聰 (@nathanlawkc) July 3, 2023

Australian-based former HK politician, Ted Hui, said the latest bounty would have no impact on his situation or personal safety, given he was also subject to multiple warrants under the National Security Law.

“I think the bounty is ridiculous and hilarious,” he told The Epoch Times via email. “Free countries will not extradite us because of that. It only shows how powerless the CCP is in response to the HK diaspora who advocate for freedom and democracy.”

Ted Hui, the former Hong Kong councillor who is now in exile in Adelaide, flew to Sydney to attend the rally. (Huang Jiachuan/ The Epoch Times)

He said the latest move showed the CCP’s persecution of HK’s overseas diaspora was reaching new heights.

“It makes it clearer to Western democracies that China is going towards more extreme authoritarianism and will pose more of a threat to the world.”

A ‘Dangerous Precedent’: US State Department

Leaders in the respective Western nations were quick to condemn the actions of HK authorities.

“The extraterritorial application of the Beijing-imposed National Security Law is a dangerous precedent that threatens the human rights and fundamental freedoms of people all over the world,” said U.S. State Department spokesperson Matthew Miller in a statement.

“We call on the Hong Kong government to immediately withdraw this bounty, respect other countries’ sovereignty, and stop the international assertion of the National Security Law imposed by Beijing,” he added.

“We will continue to oppose the [People’s Republic of China’s] transnational repression efforts, which undermine human rights.”

UK Calls Move Authoritarian, While Australia Says Hong Kong Needs Freedom

The UK’s Foreign Secretary James Cleverly called Beijing’s latest move “authoritarian.”

“The decision to issue arrest warrants for eight activists, some of whom are in the UK, is a further example of the authoritarian reach of China’s extraterritorial law,” he wrote on Twitter.

Australia’s Foreign Minister, Penny Wong, said on Tuesday that Australia was deeply concerned about Hong Kong’s National Security Law and about their broad application.

“What I would say in relation to the events overnight, and I want to be very clear, Australia has a view about freedom of expression,” she said. “We have a view about people’s right to express their political views peacefully, and people in Australia who do so will be supported.”

Wong also took to social media to call on Beijing to uphold the rights and freedoms in Hong Kong.

“We urge the Chinese government to uphold the rights and freedoms guaranteed by the Basic Law and Sino-British Joint Declaration,” she wrote on Twitter.

Prime Minister Anthony Albanese called the bounties “unacceptable.”

“We are concerned about the announcements overnight that have been made,” he told Nine’s Today program on July 5.

“We will continue to cooperate with China where we can, but we will disagree where we must. And we do disagree over human rights issues.”

Meanwhile, the Inter-Parliamentary Alliance on China (IPAC) said it was a “dangerous escalation in Beijing’s war on global dissent.”

“These comments will exacerbate community tensions and are likely to precipitate unacceptable infringements of sovereignty,” the parliamentary group wrote on Twitter.

IPAC further urged Western governments to pledge strong substantive actions against any potential overreach by Beijing to apprehend dissidents living in their countries.

In this respect, Beijing does have form, with multiple accounts from overseas communities saying they face harassment and even kidnappings from overseas CCP-linked operatives to bring them back to China.

https://www.theepochtimes.com/beijing-offers-bounties-for-8-human-rights-dissidents-living-in-us-australia-uk_5372643.html

Prosecutions filed against Chinese chemical manufacturers

 The US is moving to charge Chinese companies behind the crisis in painkiller overdoses.

Chris Taylor for RFA
2023.07.03

Plastic bags of Fentanyl are displayed on a table at the U.S. Customs and Border Protection area at the International Mail Facility at O'Hare International Airport in Chicago, Illinois, U.S. November 29, 2017. Picture taken November 29, 2017

The United States is muscling up to turn around what might be described as the Opium Wars Part II, even if it was Britain, not the U.S., that was perpetrator of the first two in the 19th century.

In an interview with NBC’s Meet the Press on Sunday, Drug Enforcement Administration administrator Anne Milgram called for further cooperation from China and Mexico to battle the U.S.’s synthetic opioid crisis.

Milgram said that even though the D.E.A. was “ready to work with anyone who will work with us,” China has not been cooperative, adding that the Mexican government also “needs to do more.”

Fentanyl, an extremely heavy-duty painkiller, is behind what the U.S. Centers for Disease Control and Prevention calls an “opioid overdose epidemic.” The drug is responsible for tens of thousands of deaths each year – and the numbers are continuing to rise.

Just over a week ago, the U.S. for the first time filed prosecutions against Chinese companies and individuals involved in manufacturing the precursor chemicals used to make fentanyl, which has flooded the country via Mexico.

The Department of Justice filed criminal charges in New York on June 23 against four Chinese companies and eight individuals, alleging that they “knowingly manufactured, marketed, sold, and supplied precursor chemicals” for illegal fentanyl production in the U.S.

Attorney General Merrick Garland said that Chinese companies openly advertised the chemicals on social media platforms and stealth shipped them to buyers.  

“We are targeting every step of the movement and manufacturing sale of fentanyl, from start to finish,” Garland said, according to reports.

“Just one of these China-based chemical companies shipped more than 200 kilograms [441 pounds] of fentanyl-related precursor chemicals to the U.S. for the purpose of making 50 kilograms of fentanyl, a quantity that could contain enough deadly doses of fentanyl to kill 25 million Americans,” Garland said.

A federal court in New York charged Hubei Amarvel Biotech, Anhui Rencheng Technology, Anhui Moker New Material Technology and Hefei GSK Trade in three separate cases.

The eight individuals charged included executives and employees of the four companies.

The two people arrested, both employees of Hubei Amarvel, were expelled from Fiji and taken into custody by U.S. officials and held in Honolulu, Hawaii.

Diplomacy on the rocks

The announcement of the prosecutions came shortly after U.S. Secretary of State Antony Blinken visited Beijing, where he met with Chinese leader Xi Jinping.

Blinken raised the issue of stemming the flow of chemical components for fentanyl to laboratories in Mexico, where the finished substance is believed to be made before being shipped and smuggled to the U.S., but no progress was made.

It is a contentious issue that has yet to gain traction with Beijing, despite it being raised repeatedly.

Speaking on the Biden-Harris Administration’s approach to foreign policy, in New York, in a public discussion moderated by the Council on Foreign Relations President Richard Haass on June 28, Blinken said that the Fentanyl issue was an issue “worth pausing on.”

Blinken added: “The No. 1 Killer – the No. 1 killer – of Americans aged 18 to 49 is fentanyl.

“So, if you start with that premise, it makes sense that you’d want to be focusing a lot of your time and resources and effort on that. And we are. And indeed, as I just mentioned, in a couple of weeks’ time, we’ll be moving forward with a broader international coalition to deal with this.”

This photo provided by the U.S. Drug Enforcement Administration's Phoenix Division shows some of the 30,000 fentanyl pills the agency seized in one of its bigger busts, in Tempe, Arizona, in August, 2017. Credit: U.S. Drug Enforcement Agency via AP

China’s Ministry of Commerce condemned the most recent moves by the U.S.

“China has always enforced rigorous anti-drug measures and, guided by humanitarianism principles, has taken the lead in globally controlling substances like fentanyl,” Chinese state media reported the ministry’s website as saying last week.

The foreign ministry, meanwhile, demanded the immediate release of Chinese citizens who were “illegally arrested.”

“China urges the U.S. side to stop dumping blame and to stop smear attacks on China,” the ministry said in a statement.

‘Down payment on a pledge’

Deputy Attorney General Lisa O. Monaco of the U.S. Attorney’s Office, Southern District of New York, said in a statement: “Today’s announcement is a down payment on our pledge to use every tool in the government’s arsenal, in every corner of the globe, to protect American communities. 

“The Justice Department will not rest or relent in investigating and prosecuting every link of the fentanyl supply chain, including the PRC companies and executives who produce and export vast quantities of the precursor chemicals the drug cartels need to peddle their poison. There can be no safe haven.”

Strips showing positive for fentanyl over a heroin doses are seen at La Sala, a safe space for women using drugs at Verter Community Center in Mexicali, Baja California State, Mexico, on May 9, 2023. Credit: Guillermo Arias/AFP

In late May the US Treasury Department’s Office of Foreign Assets Control announced new sanctions against seven entities and six individuals based in China, as well as one entity in Mexico.

China has long countered that the U.S. needs to control its apparently insatiable appetite for illicit drugs.

As nationalist state tabloid, The Global Times, editorialized on Monday, “The U.S. has never been able to solve its drug problem. The U.S. drug epidemic’s root cause lies within the country itself … The opioid epidemic in the U.S. is mainly due to the long-term and widespread abuse of prescription painkillers. The U.S. government continues to push for the legalization of marijuana, playing a role in condoning and exacerbating the problem.”

Foreign ministry spokeswoman Mao Ning said last week. “These are common commodities, which are not controlled both at home or abroad …  “The importer is responsible for preventing related equipment from flowing into drug production channels.

“If someone commits a crime with a knife, it is very clear whether the person who wields the knife or the manufacturer of the knife should be sanctioned and punished,” she added.

The Wall Street Journal recently reported that Chinese social platform WeChat is being used to facilitate payments for chemicals, according to Robert Zachariasiewicz, a former senior supervisory agent for the Drug Enforcement Administration.

Once payments have been made, Chinese suppliers send chemical components to laboratories in Mexico. It is then illegally shipped to the U.S. where it is “sold to end users for cash by networks that are often controlled by Chinese nationals or the Chinese diaspora,” the report said.

Edited by Mike Firn.

https://www.rfa.org/english/news/china/us-china-fentanyl-07032023220545.html

Netherlands unveils chip tool export curbs in fresh blow to China

News follows similar moves by U.S. and Japan as tech tensions ramp up

Following Japan and the U.S., the Netherlands has announced further export controls on chip tools that will restrain China's semiconductor ambitions. (Source photos by Getty and AP)

CHENG TING-FANG, LAULY LI and RHYANNON IMADEGAWA-BARTLETTJune 30, 2023 20:00 JST

 

TAIPEI/LONDON -- The Netherlands, home to the world's most valuable chip tool maker ASML, on Friday followed Japan and the U.S. in unveiling details of new export control rules that could deal a further blow to China's semiconductor ambitions.

The new regulation, which the Dutch government first announced it would introduce on March 8, would prevent ASML from exporting its advanced chip production tools without licenses.

ASML is the world's biggest provider of machines used in lithography -- a key part of chipmaking in which chip designs are printed on wafers. The machines are crucial for making everything from processors to memory chips.

ASML said two types of its machines fall under the scope of the export control rules and would thus need licenses for export, namely its advanced immersive deep ultraviolet lithography systems (DUV). The machines are part of the TWINSCAN NXT:2000i and later immersion systems, ASML said.

The advanced immersive DUV systems are capable of building chips that are on the 16 nanometer level or more advanced, according to industry executives. The U.S. export control regulations cover a similar level of production capabilities but in regard to different steps in the chipmaking processes.

"Shipments of other ASML systems are not controlled by the Dutch government," ASML said in a statement. The company will continue to comply with applicable export regulations, including Dutch, EU and U.S. regulations, ASML said.

The export controls will take effect on Sept. 1 -- later than Japan's rules, which are set to become effective in late July.

ASML's advanced immersive DUV systems are widely used by global chipmakers, including China's chipmaking champion Semiconductor Manufacturing International Co., memory chipmaker YMTC, and top Chinese DRAM memory chipmaker ChangXin Memory Technologies.

ASML's smaller peers in the lithography machine segment are Nikon and Canon of Japan, and China's homegrown Shanghai Micro Electronics Equipment (Group). The U.S. has no domestic lithography chip gear maker.

The Dutch government's new regulation also involves atomic layer deposition production tools -- known as ALD -- another key process in advanced chipmaking, in which Dutch company ASM International has the highest market share. ASM said it is still looking into the latest export control regulations.

The Dutch government has blocked shipments of ASML's most cutting-edge chip production tool, the extreme ultraviolet system (EUV), to China since 2019 due to U.S. pressure, Nikkei Asia first reported. The immersive DUV systems covered in the latest regulations are less advanced than EUV, but the Dutch government considers immersive DUV to be "dual-use" technology, meaning it can be used for both commercial and military purposes.

"We've taken this step on national security grounds," Liesje Schreinemacher, the Dutch minister for foreign trade and development cooperation, said of the latest move. The government said these specific technologies can be used in certain advanced military applications, and their uncontrolled export poses possible national security risks.

"We confirm that we do not expect these measures to have a material impact on our financial outlook that we published for 2023 or for our longer-term scenarios," ASML said in a press statement.

The U.S. last October launched sweeping export controls to curb all aspects of China's advanced chip ambitions. 

U.S.-based chip equipment makers Applied Materials, Lam Research and KLA are blocked from shipping tools for advanced chipmaking and engaging with clients without a license. The rules also restrict U.S. nationals from working with Chinese chipmakers.

Japan and the Netherlands joined forces in March with the U.S. in announcing export controls regarding production equipment for advanced chipmaking, though neither mentioned China in the details they unveiled.

Japan, the Netherlands and the U.S. are the three most important countries in the supply of chip production tools. Japan's Nikon and ASML are the leading suppliers of lithography machines, and are not easily replaced.

https://asia.nikkei.com/Business/Tech/Semiconductors/Netherlands-unveils-chip-tool-export-curbs-in-fresh-blow-to-China 

Samsung sues Chinese rival over alleged patent violation on iPhone displays

By Hyunjoo Jin

July 4, 2023   2:14 AM GMT+7  

 The logo of Samsung Electronic is seen at its headquarters in Seoul, South Korea, April 4, 2016. REUTERS/Kim Hong-Ji/File Photo

SAN FRANCISCO, July 3 (Reuters) - South Korea's Samsung Display has filed a lawsuit against BOE Technology (000725.SZ), accusing the Chinese rival of infringing five of its patents for displays used in mobile devices including Apple's (AAPL.O) iPhone 12.

Samsung Display, a unit of Samsung Electronics (005930.KS), asked a federal jury in Texas to award damages for the infringement of patents regarding organic light emitting diode (OLED) displays supplied by BOE. Samsung also seeks an injunction from the court to halt the import and sale of the affected displays.

The case was filed on Wednesday with the U.S. court in East Texas, which has a reputation for quicker hearings and decisions on cases.

Apple has been using OLED displays on some of its Apple Watch and iPhone models, including the latest iPhone 14. Apple says OLED delivers high resolution and allows for a thinner display than a traditional display.

The OLED display market is dominated by Samsung Display, with BOE narrowing the gap, overtaking South Korea's LG Display (034220.KS) as the No. 2 player last year, according to market researcher Omdia.

"Samsung Display has suffered, and will continue to suffer, irreparable harm as a result of Defendants’ infringement of the '599 Patent' for which there is no adequate remedy at law, unless Defendants’ infringement is enjoined by this Court," the lawsuit says, referring to the 599 patent, which improves the image quality of a device.

In December, Samsung Display filed a complaint with the U.S. International Trade Commission, alleging patent infringement by numerous companies selling OLED screens as replacement displays for mobile devices, triggering an investigation by the agency.

Samsung and Apple did not immediately respond to requests for comments.

Samsung Display executive Choi Kwon-young said in January last year that the company was actively seeking ways to receive compensation for its intellectual property, in a response to an analyst question about rising competition in the mobile OLED screen market.

South Korea is a manufacturing powerhouse for items ranging from chips and displays to automobiles, but South Korean companies have been facing a growing threat from rivals in China.

Last month, a former executive at Samsung Electronics was indicted on suspicion of stealing company technology for a copycat chip factory in China and jeopardising national economic security, prosecutors said.

Reporting by Hyunjoo Jin and Stephen Nellis in San Francisco Editing by Matthew Lewis

Our Standards: The Thomson Reuters Trust Principles.

https://www.reuters.com/legal/samsung-sues-chinese-rival-over-alleged-patent-violation-iphone-displays-2023-07-03/ 

China's choice of PBOC party chief signals financial stability worries

By Kevin Yao

July 4, 2023  4:39 PM GMT+7  

Pan Gongsheng, vice governor of the People's Bank of China (PBOC), attends a news conference during the ongoing session of the National People's Congress (NPC) in Beijing, China March 10, 2019. REUTERS/Jason Lee/File Photo/File Photo

BEIJING, July 4 (Reuters) - China's appointment of financial technocrat Pan Gongsheng to a top political post at the central bank points to growing concerns within the country's leadership over systemic risks in its sprawling financial sector, policy insiders and analysts said.

Pan, who came to prominence fighting capital outflows, will be in position to take over the top job at the People's Bank of China (PBOC) when Governor Yi Gang steps down, two policy sources told Reuters.

The central bank did not immediately respond to Reuters' request for comment.

Pan, central bank deputy governor since 2012 who turns 60 this month, is not expected to deviate from China's measured pace of policy easing to support the recovery, analysts said. He has forged a reputation as a risk averse central banker, playing a key role in enforcing several crackdowns on perceived financial threats in the past decade.

His appointment comes as China tries to ward off major challenges to its financial stability from about $9 trillion of local government debt and a downturn in the property sector, which accounts for roughly a quarter of economic activity.

"He will be able to implement key financial policies from the top to cope with economic uncertainties," said a source involved in policy discussions who preferred not to be identified due to the sensitivity of the matter.

"His professional ability will help safeguard the bottom line of systemic financial risks, especially as the property sector is slowing, and fend off a big systemic crisis."

In 2016, Pan also took on the role of China's top foreign exchange regulator, managing the world's largest foreign exchange reserves of around $3.2 trillion.

He is known for taking a tough stance against currency speculators and was also involved in state banking reforms, tightening property market and fintech regulations, and in banning cryptocurrencies.

In a speech in late May, Pan spoke at length about preventing and resolving financial risks as an "eternal theme," calling for better coordination between regulators in the context of a "complex and ever-changing external environment."

It is not immediately clear how Pan will look to make an impact, but PBOC watchers expect him to steer policy to support the economy, even as the central bank has limited room to manoeuvre, and use its macro-prudential rules to curb risks.

"Pan's appointment will help maintain policy continuity and stability, as we face pressures internally and externally," said Gu Tianyong, an influential economist at the Central University of Finance and Economics in Beijing.

In an unexpected move, the ruling Communist Party appointed Pan as the central bank's party secretary on Saturday, taking over from Guo Shuqing. The Wall Street Journal, citing people familiar with the matter, said the move was a prelude to replacing Yi.

Yi's predecessor Zhou Xiaochuan also held the governor and party secretary roles simultaneously.

If confirmed, Pan, who did post-doctoral research at Cambridge University and was a senior research fellow at Harvard University, will have a consolidated position of power, albeit in an institution reporting into new regulators.

China has taken a series of steps this year to tighten party control over the country's vast, but largely closed, financial system, including plans to set up the Central Financial Commission to oversee the PBOC and other financial regulators.

Zhou and Yi introduced pro-market reforms during their mandates, but the new structure limits PBOC's policymaking abilities and fits better with Pan's focus on risks, analysts said.

MEASURED EASING

The world's second-largest economy, under an overall debt burden of three times its output, is struggling to gain momentum due to waning external demand and its failure to lift household consumption, a long-standing weak spot.

But on monetary policy, risk-wary Pan is seen likely to support the current path of measured easing steps.

"We need to consider how to stimulate the economy, but we should first make sure risks are under control," said a second policy insider.

The PBOC cut its benchmark interest rates for the first time in 10 months in June by a modest 10 basis points, and further easing measures in coming months are expected to be similarly restrained, especially as credit demand remains subdued.

"The room for monetary policy easing is limited and the effectiveness faces many constraints," said Xu Hongcai, deputy director of the economic policy commission at the state-backed China Association of Policy Science.

Editing by Marius Zaharia and Jacqueline Wong

https://www.reuters.com/markets/asia/chinas-choice-pboc-party-chief-signals-financial-stability-worries-2023-07-04/

People's Bank of China (PBoC) 

China state lenders lower dollar deposit rates for second time in a month – sources

By Winni Zhou and Ryan Woo

July 4, 2023   2:13 PM GMT+7 

U.S. Dollar and Chinese Yuan banknotes are seen in this illustration taken January 30, 2023. REUTERS/Dado Ruvic/Illustration/File Photo/File Photo

SHANGHAI/BEIJING, July 4 (Reuters) - China's major state banks have lowered their dollar deposit rates for the second time in a month, seven banking sources with direct knowledge of the matter said, as authorities have stepped up efforts to arrest a slide in the yuan.

Interest rates offered by the "Big Five" state-owned lenders on most dollar deposits are now capped at 2.8%, down from 4.3% previously, said the people, who declined to be named as they were not authorised to speak to the media.

The People's Bank of China, which typically issues guidance on dollar deposit rates to state banks, did not immediately comment on the matter.

The lenders - Industrial and Commercial Bank of China (601398.SS), , Bank of China (601988.SS), , Agricultural Bank of China (601288.SS), , China Construction Bank (601939.SS), and Bank of Communications (601328.SS), - did not immediately respond to requests for comment.

Traders and analysts said policymakers, worried that a prolonged yuan slide could both discourage foreign investment and spur an outflow of funds abroad, want to bring down dollar deposit rates - which typically track offshore rates - towards domestic rates, which have been cut to aid the flagging economy.

The yuan is one of the worst-performing Asian currencies this year, knocked nearly 5% lower against the dollar by a slowdown in China's economy and widening yield differentials with the United States.

"It shows that the move is to narrow the interest rate advantage of the U.S. dollar in onshore markets," said Ken Cheung, chief Asian FX strategist at Mizuho Bank.

"It is likely aiming to prevent stockpiling dollars and encouraging (foreign exchange) settlements."

The lower rates could both discourage households from putting savings into higher-yielding dollar deposits and nudge Chinese firms, especially exporters, to settle foreign exchange receipts in yuan.

The new rates came into effect on July 1, said two of the sources, adding that some of the banks were not offering rates above the 2.8% cap for large deposits. Banks typically offer higher rates to deposits exceeding $1 million.

The PBOC, China's central bank, has recently moved to brake the yuan's slide against the dollar, setting stronger-than-expected daily fixings for the currency, while state banks have also been spotted selling dollars on occasion in both the onshore and offshore markets, trading sources said.

The latest cut in dollar deposit rates was the second in barely a month. In early June, sources told Reuters the big state banks had lowered such rates as much as 100 basis points from the previous ceiling of 5.3%.

Sources also told Reuters last week that the central bank has surveyed some foreign banks about the interest rates they offer to their clients for dollar deposits.

The PBOC said last Friday it would continue to keep the yuan basically stable and guard against the risk of large exchange rate fluctuations.

Some currency traders also said the cuts in dollar deposit rates would ease pressure on commercial lenders' net interest margin, as banks' dollar deposit rates had risen above lending rates before the recent adjustments.

The latest PBOC data showed that the weighted-average interest rate on large dollar deposits stood at 5.67% in March, up 4.15 percentage points from a year earlier, while the weighted-average dollar lending rate was up only 3.74 percentage points at 5.34%.

Reporting by Winni Zhou, Samuel Shen and Jindong Zhang in Shanghai, Rong Ma and Ryan Woo in Beijing, John Geddie in Tokyo; Editing by Edmund Klamann

Our Standards: The Thomson Reuters Trust Principles.

https://www.reuters.com/world/china/china-state-lenders-lower-dollar-deposit-rates-second-time-month-sources-2023-07-04/

 

People's Bank of China (PBoC) 

Beijing Steals American Technology, Claims US Response is Attack on China's Economy

June 30, 2023 3:36 PM

Polygraph.info

A customer looks at the products displayed at a Huawei flagship store in Beijing, China, March 23, 2023. in 2020, the U.S. accuses Huawei of stealing trade secret from six U.S. companies. (AP/Ng Han Guan 

Xinhua News Agency

“The IPR rhetoric is just one of the many disguises that the U.S. employs to conceal its real intention to crack down on emerging economies like China, whom it perceives as a potential threat to its economic hegemony.”

Source: Xinhua News Agency June 28, 2023

MISLEADING

Protection of intellectual property remains a sticking point between the U.S. and China as the world’s two largest economies compete to develop next-generation technologies

On June 28, China’s state-run Xinhua news agency accused the U.S. of using the subject of intellectual property rights, more specifically, its part on protection of industrial property, as a way to hinder China’s economic growth.

In a commentary, authored by agency’s writer Shi Yang, Xinhua claimed:

“The IPR rhetoric is just one of the many disguises that the U.S. employs to conceal its real intention to crack down on emerging economies like China, whom it perceives as a potential threat to its economic hegemony.”

That is misleading.

U.S. legal action against China for economic espionage is a response to Beijing’s large-scale theft of intellectual property.

In fact, 80% of all economic espionage cases by the U.S. Justice Department pursued as of 2021 involved China’s illegal economic activities.

The FBI estimates that Chinese theft of trade secrets, counterfeit goods and pirated software costs the U.S. economy between $225 billion and $600 billion annually.

The FBI estimates Chinese theft of trade secrets, counterfeit goods and pirated software costs the U.S. economy up to $600 billion annually.

The FBI says China uses its vast market to attract foreign firms and then reverse engineer foreign technology, saving Chinese firms time and money on research and development.

“As in its military strategy, China’s economic strategy is ‘asymmetric,’ taking advantage of a U.S. system founded on openness and wealth creation. In contrast, China protects large firms at home, coerces technology transfer, then seeks to eliminate leading foreign competitors,” the American Enterprise Institute, or AEI, a Washington, D.C., think tank, concluded in its June 8 report “China’s Technology Strategy: Leverage Before Growth”.

Criticizing the U.S. response to Beijing’s “predation,” AEI’s leading China analysts Dan Blumenthal and Derek Scissors, who co-authored the report, stated: “The U.S. has done little to blunt Chinese predation, indirectly supporting it with money and technology. If the most innovative American companies lose intellectual property and market share without consequence, China will control more sectors of the global economy.”

Below are recent examples of how Chinese state actors use fraud and deception to steal valuable intellectual property from U.S. companies.

GE Aviation case (2022)

In November 2021, a U.S. federal jury convicted Xu Yanjun, a Chinese government intelligence officer, of conspiracy to commit economic espionage and attempted trade secret theft. He was sentenced to 20 years in prison in 2022.

Xu, a career Chinese Ministry of State Security intelligence officer, approached a GE Aviation employee in Cincinnati in March 2017. He then requested that employee to obtain “system specification, design process” data for GE Aviation’s exclusive composite aircraft engine fan module.

GE is the only company in the world that is able to produce this light fan module.

The FBI managed to flip the GE Aviation employee, which led to Xu’s subsequent arrest in Brussels, where he brought cash as a payoff for the trade secret.

Then assistant U.S. Attorney General John Demers said: "[T]his case is not an isolated incident. It is part of an overall economic policy of developing China at America’s expense.”

APT 41 (2022)

In 2022, Boston-based cybersecurity firm Cybereason uncovered a yearlong operation by APT 41, a Chinese state-sponsored espionage group. The operation successfully siphoned hundreds of gigabytes of intellectual property and sensitive data from 30 multinational companies.

According to Cybereason, the APT 41 operation, which had been going on undetected since at least 2019, was aimed at “stealing sensitive proprietary information from technology and manufacturing companies mainly in East Asia, Western Europe, and North America.”

Cybereason CEO Lior Div noted that the cybercriminals were focused on obtaining blueprints “for cutting-edge technologies, the majority of which were not yet patented.”

These included blueprint diagrams for fighter jets, helicopters, and missiles, intellectual property related to drugs treating diabetes, obesity and depression, and designs for solar panel and edge vacuum system technology.

Huawei case (2020)

In 2020, the U.S. Justice Department charged Chinese telecommunications firm Huawei with stealing trade secrets from six U.S. companies over two decades.

According to the indictment, Huawei grew its telecoms empire “by using fraud and deception to misappropriate sophisticated technology from U.S. counterparts.”

The indictment said Huawei would enter into confidentiality agreements with U.S. firms that owned the intellectual property, and then violate the terms by misappropriating the intellectual property. It also used proxies, such as professors working at research institutions, to obtain and provide the technology needed for its own use.

Using such methods, Huawei has successfully obtained nonpublic intellectual property relating to router source code, cellular antenna technology and robotics.

Huawei then sold these products in the U.S. as lower cost versions of U.S. products, giving the Chinese telecoms giant a significant and unfair competitive advantage

https://www.voanews.com/a/fact-check-beijing-steals-american-technology-accuses-us-of-cracking-down-for-protecting-intellectual-property/7162323.html