NIAS Area Studies
PAKISTAN READER
IN BRIEF
By Avishka Ashok and Arshiya Banu
INTERNAL
ECONOMY
TECHNOLOGY
REGIONAL
INTERNATIONAL
Canada: China’s Ministry of Commerce opposes government decision to ban Huawei and ZTE
On 20 May, the Ministry of Commerce opposed Canada’s decision to ban Huawei and ZTE from its 5G network operations. The Ministry spokesperson said: “The Canadian government imposed the ban on Chinese enterprises citing "national security" concerns, lacking any concrete evidence.” He also stressed that the decision went against the market economy principles and the free trade rules and would create an impact on the bilateral relations between China and Canada. He further urged Canada to review their decision and revert its wrongful act. (“China strongly opposes Canada's ban on Huawei, ZTE telecommunication equipment, Xinhua Net, 21 May 2022)
Nicaragua: China discusses the bilateral relations six months after resumption
On 20 May, China’s Foreign Minister Wang Yi held a phone conversation with Nicaragua’s Foreign Minister Denis Moncada and discussed the past six months of diplomatic relations with each other. Wang appreciated the fast pace of cooperation between the two countries and said: “China regards Nicaragua as a reliable and important partner, firmly supports its sovereignty, independence and national dignity, and respects the development path it has independently chosen.” Wang expressed China’s willingness to strengthen the development of strategies with Nicaragua under the Belt and Road Initiative. The Foreign Minister of Nicaragua also extended support to the global initiatives started by China. (“Chinese, Nicaraguan FMs hold phone conversation, vowing to boost cooperation,” Xinhua Net, 21 May 2022)
Ecuador: China promises to enhance cooperation and bilateral relations
On 20 May, China’s Foreign Minister Wang Yi held a phone conversation with Ecuador’s Foreign Minister Juan Carlos Holguin and agreed to enhance pragmatic cooperation. Wang said: “In February this year, Ecuadorian President Guillermo Lasso attended the opening ceremony of the Beijing Winter Olympics and paid a successful visit to China, during which the two heads of state reached important consensus on the development of bilateral relations.” Wang also observed that the cooperation between the two countries features mutual assistance, support and yields great outcomes. (“China, Ecuador pledge to advance pragmatic cooperation,” Xinhua Net, 20 May 2022)
Goldman Sachs: A third of High Yield China property firms to default
On 20 May, Goldman Sachs stated that it now expects approximately a third of high-yield China property firms to default by 2022, with bond stress increasing as maturity extensions are extended. The bank found that all 22 Chinese high-yield issuers that defaulted on their dollar bonds or undertook bond exchanges were tied to the country's troubled property market since the beginning of the year. Goldman Sachs’ Head of Asia Credit Strategy Research Kenneth Ho increased his default rate forecast to 31.6 percent from 19 percent earlier. He said: "Unlike in previous years, more issuers have conducted bond exchanges than have defaulted so far this year." The increase in Goldman Sachs' China property high-yield default projection raised the default rate among high-yield Asian corporate issuers to 15.5 percent, up from 9.3 percent earlier, and close to the record of 17.8 percent set in 2021. (“Goldman Sachs expects one third of HY China property firms to default in 2022,” Channel News Asia, 20 May 2022)
Japan: PM disappointed with Chinese development in the East China Sea
On 21 May, Japanese Prime Minister Fumio Kishida expressed his disappointment with China’s plans to develop areas in the East China Sea, calling them “unacceptable.” He stated that the government has filed a complaint against China after confirming Beijing’s construction in the area where the two countries' exclusive economic zones (EEZ) overlap. The Japanese Foreign Ministry said: “It’s extremely regrettable that the Chinese side is unilaterally proceeding with development in the waters,” and that “the borders of the economic exclusive zones and the continental shelf are yet to be settled in the East China Sea.” Japan has long asserted that the median line between the two countries should serve as the boundary between their respective EEZs. However, China insists that the border be moved closer to Japan, considering the continental shelf and other marine features. (“Japan's Kishida calls China's development in East China Sea 'unacceptable',” The Strait Times, 21 May 2022)
The UN: Human Rights chief under criticism for Xinjiang trip
On 22 May, the United Nations (UN) human rights chief Michelle Bachelet came under criticism after announcing a trip to China's Xinjiang, with the US accusing her of failing to protect the region's Uighur population. Bachelet will lead a six-day mission to China starting Monday, after years of requesting "meaningful and unfettered" access to far-western Xinjiang. The visit, which comes at Beijing's invitation, is the first by a UN human rights official since Louise Arbour in 2005. The US said it was "deeply concerned" that Bachelet, a former Chilean president, was proceeding without guarantees on what she can see. (“US leads criticism of UN rights chief for China trip,” The Strait Times, 21 May 2022)
The Czech Republic: Foreign Ministry reviews options regarding its participation in China’s 16+1 group
On 21 May, Foreign Ministry of the Czech Republic stated that the state was reviewing "all options" about its participation in the China-led 16+1 platform for cooperation with central and eastern European countries. A series of unsuccessful Chinese investment projects, Czech warnings against Chinese 5G telecoms technology, and a change of administration in Prague last year has chilled interest in deepening ties with China. Minister Jan Lipavsky said: "The main initiatives of 16+1, economic diplomacy and the promise of massive investments and mutually beneficial trade, are not being fulfilled even after 10 years." The statement came after a foreign committee of the Czech lower house of parliament called on the Cabinet to leave the group. (“Czechs considering 'all options' regarding China's 16+1 group,” The Strait Times, 21 May 2022)