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Photo : South China Morning Post

China Reader Daily Wire | 30 April 2024, Tuesday | Vol.1 No. 69

Taiwanese semiconductor firm KYEC to divest from China over geopolitical tensions

Tesla shares soar by 15 per cent after confirming a deal with Chinese firm Baidu

HIGHLIGHTS

CHINA & TAIWAN
Taiwanese semiconductor firm KYEC to divest from China over geopolitical tensions
On 29 April, the South China Morning Post reported that King Yuan Electronics Co (KYEC) had divested from the Suzhou subsidiary in China. KYEC is one of the world's largest semiconductor testing and packaging firms. The board of directors of the firm decided to divest from the Jiangsu province of China amid brewing geopolitical tensions and the changes in cross-strait supply chain changes. KYEC Microelectronics Co. gave away its 92.16 per cent shares in the Suzhous King Long Technology firm for USD 4.9 billion Yuan. KYEC informed that the deal will with completed by the third quarter of 2024 and the funds raised would be used to invest in high-tech testing and other equipment. The company’s decision reflects how the US tech restriction has affected the supply chain and now they look to invest in other markets. This comes after the Biden administration updated the restrictions on semiconductor-related exports to China. (Kelly Le, “Taiwan semiconductor firm KYEC to exit mainland China amid geopolitical tensions, changes in cross-strait chip supply chain,” South China Morning Post, 29 April 2024)

SCIENCE & TECHNOLOGY
Tesla shares soar by 15 per cent after confirming a deal with Chinese firm Baidu
On 29 April, CNBC reported that Tesla shares have jumped exponentially since the firm approved a deal with the Chinese company Baidu. China has tentatively approved the plan to launch the “Full-Self Driving” FSD software in the Chinese market. After the deal, Tesla’s shares rose by 15 per cent the highest in the last two years. This surprise tie-up comes after Musk met two Chinese leaders. Tesla’s sales in China fell by 30 per cent in 2024 as it faced stiff competition from domestic rivals in China. Muska aims to introduce FDS which can accelerate, steer, and brake but is not fully autonomous technology. Data security has been a hurdle for Tesla’s investment in China and therefore the deal with Baidu, the Chinese firm would provide access to Tesla to its mapping and navigational technology. (Ryan Browne, “Tesla jumps 15% after passing key hurdle to roll out advanced driver-assistance tech in China,” CNBC, 29 April 2024)

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SCIENCE & TECHNOLOGY
China has 369 unicorn start-ups with an average value of USD 3.28 billion
On 30 April, the South China Morning Post looked into a report finding that there are start-ups in China mainly on AI and Semiconductors. The report was published by Zhongguancun Unicorn Company Development Alliance and consultancy Great Wall Enterprise Institute and KPMG amongst others. The report found that there are 369 unicorn companies in China with an average value of USD 3.8 billion, most of these startups are involved with the advancement of Artificial Intelligence and Semiconductors. The highest valued in these are the AI unicorns with an average of USD 6.76 billion. While growing China is still behind the number of startups overall compared to the US. In 2024 the Global Unicorn Index found that there were 700 unicorns in the US and 340 unicorns in China. The ZGC report found that 25 unicorns are being incubated by big Chinese tech companies and more than 70 per cent received investment and funds internationally. (Coco Feng, “China now home to 369 unicorns, with an average value of US$3.8 billion, led by AI and semiconductor firms, report says,” South China Morning Post, 30 April 2024)

CHINA & SOUTHEAST ASIA
Chinese Coast Guard claims they “expelled” Philippines vessels
On 29 April, Chinese coast guards informed that they “expelled” a Philippines vessel from the Scarborough Shoal. The Philippines coast guard accused the Chinese of using water cannons against their ship. Commodore Jay Tarriela said: “This damage serves as evidence of the forceful water pressure used by the China Coast Guard in their harassment of the Philippine vessels.” This comes in light of the ongoing conflict between China and the Philippines in the South China Sea region as they assert their claims in the disputed region. (“China’s coast guard expels Philippine vessels from waters off Scarborough Shoal, state media says,” The Strait Times, 30 April 2024)

CHINA & SOUTH ASIA
Pakistan’s Navy launches Hangor Class submarine constructed by Chinese Wuchang Shipbuilding Industry
On 26 April, the Pakistan Navy announced the launch of their 1st Hangor-Class submarine constructed by the Wuchang Shipbuilding Industry Group based in Wuhan, China. Chief of the Naval Staff Admiral Naveed Ashraf addressing the gathering stated the importance of maritime security in the current geo-strategic environment. The Hanor Class is state-of-the-art weaponry that would be pivotal in maintaining peace and stability in the region said the Naval Chief. He also acknowledged the efforts of the China Shipbuilding & Offshore International Company Ltd (CSOC) who signed the deal with Pakistan to acquire 8 Hangor Class submarines. The launch was attended by high-ranking Chinese and Pakistani officials and a representative from the Wuchang Shipbuilding Industry Group. (“Pakistan Navy Launches First Hangor-Class Submarine In China,” Naval News, 28 April 2024)

CHINA & EUROPE
Chinese President to visit Europe expects to discuss ongoing conflict and trade tensions
On 29 April, VOA reported that Chinese President Xi Jinping is set to visit Europe for a six-day trip. The trip would include stops in France, Hungary, and Serbia. The analyst believes that while the discussion will include the Russia-Ukraine war and the Israel-Gaza conflict, Xi might focus more on the trade tensions. National Dong Hwa University in Taiwan expert on EU-China relations Zsussa Anna Ferenczy said: “In light of Europe’s growing appetite to investigate what they view as China’s unfair trade practices, [Xi’s European tour] is a trip to disrupt the EU’s efforts to adopt tougher trade measures against China.” Anna also believes that by making a stop at Hungary and Serbia Xi wants to show that China is still influential in Central and Eastern Europe. Anna said: “For Beijing, the symbolism of the trip to Serbia and Hungary is important as the stop in Budapest serves as an opportunity to amplify divisions within the EU.” (William Yang, “China's Xi to Visit Europe as Trade Tensions Rise,” VOA, 29 April 2024)

CHINA & THE AMERICAS
American Athletes groups call WADA to investigate the clearance of 23 Chinese swimmers of drug use
On 30 April, the Associated Press reported that two American athlete groups had sent a letter calling for a “truly independent” probe and investigation into the clearing of 23 Chinese swimmers by the World Anti-Doping Agency. The USD Athletes Advisor Council and the Team USA Athletes Commission sent the letter to the director of the National Drug Control Policy. The US holds half the funds for the WADA and had previously held back the funds due to the incompetency of the agency. The athlete's group stated that: “As athletes, we have to trust WADA to set and enforce standards that will ensure fair play and protect our rights,” and that “WADA’s failure to follow its own rules and procedures in the wake of the positive tests of these 23 Chinese athletes has broken this trust.” (“Chinese doping on their mind, US athletes send a letter to America’s drug czar asking for answers,” Associated Press, 30 April 2024)

Chinese Foreign Ministry Warns US against “Negative China-related” legislations
On 29 April, the Chinese Foreign Minister hinted that they could retaliate after the US signed the two legislation that goes against China. The Joe Biden administration approved two bills one to provide military aid packet to Taiwan and the second the divestment of ByteDance from TikTok if it does not want to be banned. The spokesperson for the Chinese Ministry of Foreign Affairs Lin Jian said: “If the United States clings obstinately to its course, China will take resolute and forceful steps to firmly defend its own security and development interests.” It urged the US to refrain from implementing “negative China-related” legislation. (“China hints at retaliation after Biden signs Taiwan, TikTok laws,” The Straits Times, 29 April 2024)

Grievances grow in Argentina over Chinese mining firms
On 30 April, BBC looked into the growing unrest in Argentina over the Chinese mining activities for green technology. There has been a protest in Argentina over the friction between the locals and the Chinese firms extracting and mining. Chinese firms dominate the processing of minerals that are vital for the development of green technology. The Chinese companies have expanded over the years and are now facing abuses and challenges. Ai Qing who works for the Chinese company that extracts lithium said: “Beyond the language, we have to tone down many things, like how management thinks the employees are simply lazy and too reliant on the union, and how locals think Chinese people are only here to exploit them.” (“Tensions grow as China ramps up global mining for green tech,” BBC, 30 April 2024)

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