Voices From China’s Covid Crisis, One Year After Wuhan Lockdown

They are survivors, essential workers and specialists still trying to understand the physical and emotional effects of the coronavirus. They make up a tapestry of people, offering a view of the first months of the pandemic, and of what China’s recovery means.

A year after the Covid-19 lockdown in the Chinese city of Wuhan — the first in the world, and still one of the harshest — we asked six people, some of whom we spoke to at the height of the outbreak, to describe what they have been through.

These interviews have been edited and condensed for clarity.

One day in August, our manager reminded us that drivers always had to wear masks, no matter how much the situation had improved. Personally, I don’t know if it’s PTSD, but I always wear a mask. I’m probably the only driver in our company who still always carries hand sanitizer in my pocket and uses it regularly.

I always thought I wasn’t afraid of death. But I found out during the epidemic that I’m terrified of it. I missed my wife, my 5-year-old twin boys, my father, so much. I thought, if I survive this, what will I do?

So after the lockdown lifted, my first thought was going home. I stayed two months. In the past, I would stay two or three days, maybe a week, then hurry back. I don’t make a lot of money, and my mind was always on making more. But now, my thinking has changed. If I make a little more money, what’s the use?

I never thought that this sudden epidemic would create a situation where everyone said thank you. I was shocked. Wasn’t respect for people like experts, academics, celebrities? How could it go to a delivery worker? It made me so happy.

Now, things have gone back to the way they were last year. This is human nature.

Zhang Yongzhen, a virologist, came under immense official pressure after he released the full sequence of the new coronavirus on Jan. 11 of last year, in defiance of Chinese government orders. He remains absent from Beijing’s narrative of how the country beat the virus, in contrast with Zhong Nanshan, the government-appointed doctor celebrated for announcing what many experts had already figured out: that the virus could be transmitted by humans.

At that time, I made four findings about the virus. One, it was like SARS. Two, it was a new coronavirus. Most important, the virus was transmitted through the respiratory tract. I also thought it was more infectious than the flu virus. Even then, I thought it must be able to spread from humans to humans.

If more experts had shared my opinion from the beginning, then we may not have needed Zhong Nanshan to say something.

Whether in the United States or in China, we need to cultivate a group of critics — real scientists in the field. China really needs it. Zhong Nanshan is old. Who will be the next to dare to speak the truth? You must have enough courage to speak the truth.

I have since encountered some difficulties in terms of my work and funding for my programs. But I don’t regret anything I did. I trusted myself. I have so much experience, my team has made so many discoveries over the years, that we were able to make accurate judgments.

I hope you can mention one thing. My wife passed away on Oct. 13, 2019. We got married in 1989 and we were together for 30 years. If I have made any contribution to society, it is because of the support of my wife.

Blair Zong, 34, was one of hundreds of Americans who were evacuated from Wuhan, and she published a visual diary in February chronicling her quarantine on a military base in California. She is now in Austin, Texas, working as an event planner and a nanny.

After Wuhan locked down, I was nervous and anxious. I heard rumors about people dying and things got really scary. Someone sent me a report that said America was evacuating citizens, so I called the consulate. I made the decision to go and said goodbye to my mom and grandparents.

The day I left quarantine, there was a lady behind me in line in the San Diego airport who was coughing nonstop. I remember thinking at the time that it was a bad sign, but I also felt like there was no way the virus could spread here that badly. Everything was normal again.

But then starting in March, people here started buying up toilet paper, and the panic came back. The situation had stabilized in China, so my friends there started to mock me, asking: “Do you regret going back now?” One of my college friends in Wuhan sent me a package of goggles and masks.

I have become more calm and more careful about life. I accept everything as it comes. I’m trying to be more eco-friendly.

As Wuhan focused on fighting the coronavirus, Zhao Qian, 29, struggled to get medical treatment for her newborn daughter, who had a life-threatening heart condition.

At the time, hospitals weren’t taking in any patients, including our daughter. We tried so hard, we tapped every possible resource and connection, and it was only through our efforts that we were able to save our daughter’s life. All of the doctors had gone to the frontline.

Overall, though, the country’s policies were quite good. I remember when all the supermarkets were closed, some volunteers were still helping me buy food. No matter what unpleasant hearsay or rumors there may have been, I think the country was very powerful. Wuhan people are now very safe. It’s very reassuring.

Any Chinese person should feel very proud. No matter how great the hardship, even with an outbreak that was so serious that other countries couldn’t control it, as long as the people are unified, I think we can get through anything.

Lei Wuming, 50, a psychology professor at the Wuhan University of Technology, began hosting funerals over WeChat, a popular messaging app, to give grieving families a way to mourn.

Back then, I was like a priest hosting these funerals. I was also a psychologist. I helped create an atmosphere for families to express their grief. First, to express their grief, and second, to cherish the memories.

It brought families closer. They recalled the same memories and the same person and it made their relationship closer. They were huddling together to keep warm.

The families would set up a chat group. Then I would join. I would play some funeral music and then make a speech. Then I would name each person who would talk, one by one. They could choose to talk, type or even send emojis.

It was social support, so the family would feel, “I am not alone here. I have families and friends who are there for me.”

In retrospect, our death toll compared to Western countries — if it is truthfully reported — ours is quite low. But at the time of the pandemic, we didn’t think like that. We thought we were done for.

After Liu Pei’en’s father died from the coronavirus last January, he vowed to pressure the authorities to take responsibility for initially concealing the outbreak.

Looking back at the first half of last year, I was so angry. The local officials threatened me. I left Wuhan, and they still wouldn’t let it go. They harassed my relatives. They wanted to make it seem like I had a mental illness.

But in the second half of the year, I began to change. I devoted myself to studying Buddhism. Faith allows you to understand life and truth. I could see that retribution and killing have been a part of humanity from ancient times to the present.

My heart began to calm down. I am no longer angry and full of hate. Still, the pain is raw and I cry a lot.

I spend a lot of time praying. I try to donate as much money as I can to temples and other charity organizations for the poor and elderly around Wuhan. I have given more than 100,000 yuan ($15,000) in my father’s name, to help him earn merit.

Any dreams I had for making money before have now faded. Because what is the use of money anyway? Money can’t buy back life.

I realized I was ignorant when I thought I could sue the government. Nothing will come of it. And if you take a step back, everyone is guilty and will face karmic retribution.

I only care about the people around me, about being myself. I’m planning to take my mother to Sanya for Chinese New Year. That’s where we were going to go last year before my father was infected.

Reporting and research was contributed by Keith Bradsher, Albee Zhangand Coral Yang.

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China’s frozen food theory has shoppers shunning imports

The consumer distrust is being fuelled at least partly by statements from the government, which has taken increasingly drastic steps to curb the risk of the virus spreading via food imports even though most international health authorities have downplayed the likelihood of such transmission.

Last week, China reported its first cluster of COVID-19 cases among workers in a meat processing plant, raising fears about the safety of imported foods.

A customer looks at imported meat at an Ole supermarket in Shanghai.Credit:Bloomberg

Ten confirmed cases were found in a factory which slaughters 50 million chickens a year in the northeastern city of Harbin and is owned by Thai conglomerate Charoen Pokphand, one of the world’s top poultry producers.

The World Health Organisation has said there’s no evidence of people catching the virus via food and food packaging, while the US Centres for Disease Control and Prevention says the chances of getting COVID-19 from frozen foods is very low.

It’s a debate with global ramifications and an increasingly contentious one because China is one of the world’s biggest buyers of many food products, accounting for as much as 45 per cent of the global pork trade.


China has gone even further with its frozen food theory, with state media suggesting the virus could have entered the country via frozen products or packaging. This comes as the hunt for the origins of the coronavirus becomes highly politicised, with a WHO team currently in Wuhan to probe further, and the US pushing the idea it could have escaped from a lab in the city — a claim China has denied.

In China, where pride in the country’s largely successful containment of the virus runs high, some consumers have become more cautious on products like foreign seafood. No visitors were seen checking out a one-for-one deal for prawns from Malaysia at Ole.

“I like imported shrimps, but I won’t be missing out if I don’t eat them now,” said Jia Jinghong, a retiree from Beijing. “There is a risk during this time. I dare not take the risk.“

China’s focus on food packaging began as early as June after the country singled out imported salmon as a possible culprit for a Beijing resurgence. Since November, consumers have been able to check the origin and flow of cold-chain foods, as well as virus testing certifications, by scanning mandatory QR codes.

China has also ordered mass-testing and disinfection of all frozen food imports, causing severe port congestion and lengthening the time taken to clear customs to one month from one week. Some small cities now ban the sales of imported meat. In Beijing and Shanghai, supermarkets are required to have separate shelves and sections for imported frozen food to avoid cross contamination.


Such moves could squeeze foreign suppliers. Stringent testing has disrupted sales and may cut the country’s pork imports, said Zhu Zengyong, a researcher for the Institute of Animal Science of the Chinese Academy of Agricultural Sciences. The effects will be particularly significant from about March to April, after the Chinese New Year peak demand season, and it coincides with the recovery of China’s domestic pig population after a devastating African swine fever outbreak in 2018, Zhu said.

In a report last year, the state-run Global Times raised the possibility that the coronavirus could have been passed on from imported frozen products into Wuhan, where the novel coronavirus was first identified. The nation has also seized on research suggesting there were infections in the US and Italy that pre-date those in Wuhan.

But few experts have backed those theories, with the circumstances of how the virus moved from bats, their suspected source, to humans a stubborn mystery scientists are still trying to solve. Some say the pathogen could have somehow moved directly from bats to people, while others flag the possibility an intermediary animal may have been involved.

Over recent months, China has said traces of the pathogen were found on imported frozen food products or their packaging, and linked those to outbreaks in the major port cities of Dalian, Tianjin and Qingdao.

The fallout is being felt by even small businesses. Sarah Ye, an online retailer for baby products, now has a particularly hard task when she sells imported snacks to the young mothers in a WeChat group she founded for her business: Convincing her cautious clients the products are COVID-free. In a promotional campaign to sell processed cheese for kids, she uploaded the test report that shows a negative result for the packaging.


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China’s policies on Muslims amount to ‘genocide’, claims Mike Pompeo

Many of those accused of having taken part in the repression are already under US sanctions. The “genocide” designation means new measures will be easier to impose.

“After careful examination of the available facts, I have determined that since at least March 2017, the People’s Republic of China, under the direction and control of the Chinese Communist Party, has committed crimes against humanity against the predominantly Muslim Uighurs and other members of ethnic and religious minority groups in Xinjiang,” Pompeo said in a statement.

A detention facility in the Kunshan Industrial Park in Artux, Xinjiang.Credit:AP

“In addition, after careful examination of the available facts, I have determined that the PRC, under the direction and control of the CCP, has committed genocide against the predominantly Muslim Uighurs and other ethnic and religious minority groups in Xinjiang. I believe this genocide is ongoing, and that we are witnessing the systematic attempt to destroy Uighurs by the Chinese party-state.”

Tuesday’s move is the latest in a series of steps the outgoing Trump administration has taken against China.

Since last year, the administration has steadily ramped up pressure on Beijing, imposing sanctions on numerous officials and companies for their activities in Taiwan, Tibet, Hong Kong and the South China Sea.


Those penalties have gotten harsher since the beginning of last year when President Donald Trump and Pompeo began to accuse China of trying to cover up the coronavirus pandemic. Just on Saturday, Pompeo lifted restrictions on US diplomatic contacts with Taiwanese officials, prompting a stern rebuke from China, which regards the island as a renegade province.

China has imprisoned more than 1 million people, including Uighurs and other mostly Muslim ethnic groups, in a vast network of concentration camps, according to US officials and human rights groups. People have been subjected to torture, sterilisation and political indoctrination in addition to forced labor as part of an assimilation campaign in a region whose inhabitants are ethnically and culturally distinct from the Han Chinese majority.

Five days ago, the administration announced it would halt imports of cotton and tomatoes from Xinjiang with Customs and Border Protection officials saying they would block products from there suspected of being produced with forced labour.

Xinjiang is a major global supplier of cotton, so the order could have significant effects on international commerce. The Trump administration has already blocked imports from individual companies linked to forced labour in the region, and the US has imposed sanctions on Communist Party officials with prominent roles in the campaign.


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China’s famous Ice Town sees annual sculpture festival scaled back amid pandemic

Harbin is known as China’s “Ice Town” due to its famous, annual ice sculpture festival.

This year, the snow-themed events have been scaled back due to the coronavirus pandemic.

While Ice and Snow World and the Snow Sculpture Exhibition, two of the most famous festival sites, are open, all mass gatherings have been cancelled.

Han Zhenkun, a Harbin sculptor who participated in the festival’s ice sculpture contest in 2018, says that creating ice sculptures is a magical process.

He misses the festival’s hustle and bustle he felt in previous years.

This year, Han and his colleagues at the Heilongjiang Research Institute of Contemporary Art presented an exhibition of snow sculptures consisting of more than 40 snow blocks of different sizes.

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China’s commercial jet ambitions shaken as US blacklists COMAC

HONG KONG — The inclusion of China’s state-owned commercial jet maker on the Trump administration’s latest sanction list could disrupt Beijing’s plans to carve out a big piece of the lucrative industry for its homegrown champion, given the company’s high dependence on U.S. suppliers.

Beijing’s hopes of challenging the lock held by Boeing and Airbus on the large commercial jet market rest primarily on Commercial Aircraft Corp. of China, or COMAC.

With China forecast to be the biggest source of demand for such planes in the coming years, COMAC has been winning an increasing share of local orders for smaller jets with its ARJ21 model. But it is seeking to move into the mid-sized market with the C919, which is still undergoing flight tests.

The U.S. Department of Defense announced on Thursday that it would add COMAC, phone maker Xiaomi and seven other Chinese companies to an official list of companies judged to be linked to the Chinese military and thus meriting special scrutiny. Under an executive order signed last year by U.S. President Donald Trump, American investors must halt investing in such companies as of this week.

Unlike Xiaomi, COMAC is not a publicly traded company, so the investment ban will likely have limited direct impact, though the company has sold bonds domestically. The risk, though, is that the addition to the military list sets up COMAC’s addition to the so-called entity list maintained by the U.S. Department of Commerce. That would then restrict American companies’ ability to export products to the plane maker.

Referring to the odds that the latest military-linked companies will be added to the entity list, Edison Lee, an equity analyst at Jefferies in Hong Kong, compared their situation to that of Chinese oil company CNOOC, which the Commerce Department singled out on Thursday, 43 days after its inclusion on the military list.

“The risk looks high,” Lee said, adding that Xiaomi and the others will follow the same path.

That would be a big problem for COMAC. The engines for its C919 are made by CFM International, a joint venture between General Electric and France’s Safran. The ARJ21’s engines come from Connecticut-based Pratt & Whitney.

On Friday, a regional spokeswoman for Pratt & Whitney referred questions about the impact of the U.S. Defense Department’s move to parent company Raytheon Technologies. A Raytheon spokesperson said the company would look into the situation, while GE had not responded to Nikkei Asia by the time of this article’s publication.

COMAC’s website includes a number of other U.S. companies as “tier one” suppliers of key component systems, including Honeywell, B/E Aerospace, Donaldson, Moog and Parker Hannifin.

In its statement on Thursday about COMAC, the Pentagon said it was determined to highlight and counter China’s “military-civil fusion development strategy,” which supports the modernization of the People’s Liberation Army through securing advanced technologies and expertise via private companies and universities. Though COMAC focuses on commercial aircraft, aviation technologies can often be redeployed for military purposes.

State-backed companies have long sought to absorb foreign aerospace technologies, especially for engine making.

Stanley Chao, a veteran American consultant to the aviation industry, said on Friday that it was “common knowledge” in the industry that COMAC has military ties.

For Chao, who has connected a number of American “tier two” suppliers to COMAC over the years, “the damage has been done already in terms of technology transfer.”

Chinese state companies “now have the basic foundation and the knowledge to do [manufacturing] on their own,” he said, after years of absorbing knowledge from foreign partners and suppliers. He added that non-American companies are ready to step into any openings created by exiting U.S. suppliers.

COMAC is a strategically important company for Beijing. It was set up to fulfill the country’s dream of building and producing proprietary mid-to-large-sized commercial jets, a sector dominated by the U.S. and Europe.

With the original approval given by the State Council in 2002, the company took off in 2008 with an investment by the central government organization Assets Supervision and Administration Commission, or SASAC, and several other major large-scale state-owned enterprises, such as the Aviation Industry Corporation of China, or AVIC.

According to COMAC’s latest annual report, published in April 2020, SASAC owns 52% of the company. The first nine months of 2020 were rough for COMAC, with its revenue down 35% from the same period a year earlier to 2.73 billion yuan ($422 million), while its net loss bloated by almost sixfold to 1.54 billion yuan.

Unlike Huawei Technologies, which was a major global player in telecommunications equipment and smartphones when it was added to the entity list, COMAC’s sales have been overwhelmingly domestic. With the state controlling most of China’s airline and jet leasing sectors, COMAC has been getting a steady stream of local orders for both the ARJ21 and C919.

China Aircraft Leasing Group Holdings, a subsidiary of state-owned China Everbright Group, last week ordered 60 ARJ21s as part of a plan to promote Chinese aircraft in Southeast Asia. According to research by Scott Kennedy of the Center for Strategic and International Studies in Washington, COMAC has received 1,065 orders for the C919 from 32 companies, all but two Chinese.

The Chinese airline industry is expected to order 8,725 jets with more than 50 passenger seats over the next 20 years, according to a COMAC projection from last November that valued those planes at about $1.3 trillion based on 2019 catalog prices.

Up for question is whether the incoming administration of U.S. President-elect Joe Biden will maintain the policy trajectory of blacklisting Chinese companies.

Chao expects the new administration to hold off adding COMAC to the entity list given that “a lot of American jobs” would be at risk.

“Too much future business is at stake, and the damage has already been done,” he said.

Speaking more broadly about the latest Defense Department list additions, Jefferies’ Lee said that whether a move to the entity list proceeds “will give us a good indication on what direction Biden’s China policy will be heading.”

“We are confident there will be some de-escalation of the China-U.S. tech war, with the U.S. likely moving more to technology-specific export restrictions, rather than company-specific (ones),” he said.

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China’s Alibaba probe is not all bad news

Angela Huyue Zhang is an associate professor at the University of Hong Kong and director of its Center for Chinese Law. She is the author of the upcoming book “Chinese Antitrust Exceptionalism: How the Rise of China Challenges Global Regulation.” (Oxford University Press, March 2021)

The Christmas Eve announcement by China’s State Administration of Market Regulation that it would investigate Alibaba Group Holding for monopolistic tactics wiped over $100 billion from the company’s market value within just a day.

The strong reaction reflected investor concern over Alibaba’s future prospects amid continuing fallout from a controversial speech by founder Jack Ma attacking financial regulators as well as a series of recent declarations from the authorities about reining in the country’s powerful internet platforms.

But neither the companies nor their investors should be overly gloomy. Some might prefer that Chinese regulators simply stay away from e-commerce, but the way that the SAMR is going about its work on Alibaba gives some cause for comfort and hope.

On Christmas Day itself, the Chinese competition authority released its first annual report. The 240-page publication included detailed statistics and a compilation of enforcement actions taken by both central and local SAMR offices.

Given scant regulatory disclosure since China’s anti-monopoly law was enacted 12 years ago, the report shed much-needed light on the authorities’ decision-making.

Two days later, the SAMR announced that it had completed gathering evidence at Alibaba’s headquarters in the city of Hangzhou, noting that the e-commerce group had been cooperating with its investigation.

The spate of disclosures from the SAMR signals that it is ready to inject more transparency into anti-monopoly enforcement in China.

This marks a critical and desperately needed improvement. Over the past decade, foreign multinationals operating in China have complained to their governments and chambers of commerce about due process violations and a lack of transparency in Chinese antitrust enforcement.

Much of the criticism was directed at the National Development and Reform Commission, one of three agencies that dealt with anti-monopoly matters before the founding of the SAMR in 2018. The commission aggressively pushed investigations into high-profile targets in a large number of sectors including telecommunications, automobiles and semiconductors as well liquor and infant formula companies.

In comparison to the NDRC, the State Administration for Industry and Commerce was a relatively restrained enforcer.

The only large case that the SAIC brought was one against Swiss-Swedish packaging company Tetra Pak and it took almost five years to complete. The end result, a fine for abuse of monopoly power, reflected the agency’s in-depth and thorough economic analysis, something quite rare among Chinese competition regulators.

The stand of Tetra Pak products during an expo in Shanghai, pictured in October 2006: the case against the packaging company took almost five years to complete.

  © Imaginechina/AP

The SAMR’s competition bureau was formed by combining the SAIC with the country’s other two antitrust offices. Given the leading role of SAIC staff, the new unit was expected to inherit the old agency’s bureaucratic culture and a cautious and legalistic approach to enforcement.

Over the past two years, the SAMR has greatly streamlined the merger review process and established a relatively good reputation for professionalism in handling cases.

At the same time, the SAMR has faced significant capacity constraints, a situation that has actually worsened since the consolidation of the three agencies. Many antitrust officials, seeing lower prospects for career advancement, have departed for private practice, often becoming in-house lawyers for Chinese technology companies.

The current regulatory campaign thus represents a golden opportunity for the SAMR to step into the policy limelight to make the case for more resources.

It also gives the agency a chance to address market speculation that its initiative is politically driven. The timely disclosure of progress with the Alibaba investigation and the company’s cooperation should help tame some of the market volatility around Chinese tech stocks which has even enveloped Alibaba’s rivals.

At the end of the day, Chinese regulators need to strike a delicate balance between economic growth and market regulation, both of which can affect the government’s legitimacy.

To be sure, the authorities want to discipline Alibaba and teach it a hard lesson so that Chinese tech giants will learn to obey orders in the future. But it will not be in their interest to mete out overly harsh punishments against major tech companies as that could cause market turmoil leading to other regulatory problems that might threaten economic or financial stability.

As such, the anti-monopoly authority is unlikely to go as far as ordering the breakup of Alibaba. That kind of structural remedy could be difficult and complicated to implement and might cause too much pain to the company.

Most likely, the SAMR will impose a high fine and some behavioral remedies. Chinese competition authorities have tended to levy big fines in part because of the resulting media attention which increases the agencies’ profile and visibility within the establishment and beyond.

Under Chinese law, the SAMR can impose a fine of up to 10% of the offender’s revenue from the previous year in cases of monopoly abuses or cartel formation. In Alibaba’s case, this would dwarf the two 500,000 yuan ($77,000) fines the agency imposed last month on the company and others for failing to seek regulatory approval of previous acquisitions and for misleading retail pricing and promotions.

Chinese antitrust regulators are also acutely aware of possible spillover effects from their moves against Alibaba for the China tech sector. The transparency and professionalism that the SAMR is injecting into the administrative process thus should offer some comfort for major Chinese tech companies like Tencent Holdings and Meituan as well as their anxious investors.

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China’s lobster ban helped lift Australian Christmas seafood purchases by 30 per cent

China may have dropped imports of Australian lobsters, but domestic consumers queued up for seafood in huge numbers before Christmas.

The seafood industry’s peak body said this support by Australians over the festive period resulted in a significant boost in its Christmas sales.

It was a difficult 2020 for Australian fishermen with COVID-19 affecting both food service and export markets.

“We needed a bumper Christmas period to help us claw our way back,” Veronica Papacosta, CEO of Seafood Industry Australia (SIA) said.

It seems that SIA’s campaign calling on consumers to support the struggling sector, by switching one meal on the Christmas table to seafood, worked.

“We’re hearing from retailers and producers right across the country that they’re up, on average, 30 per cent from last year’s December sales,” Ms Papacosta said.

While the crustaceans and molluscs — prawns, rock oysters, crabs, and bugs — were all popular, the $20 Western Rock Lobster bargain was also highly sought after.

The SIA is now calling on Australians to continue supporting the industry by changing one meal a week to locally sourced seafood.

“This could mean the difference between a fisher making or missing a mortgage payment, and a boat heading out of harbour, or spending another week docked,” Ms Papacosta said.

A plate of two Australian lobsters and plenty of prawns and oysters on a table.
China’s ban on Western Rock Lobsters enabled Australian consumers to pick up the premium product for their Christmas feast for a mere $20.(Supplied: Perrin Finlay-Brown)

Coffs seafood business ‘smashed’ with strong sales

Business is booming for fishermen based at Coffs Harbour in northern New South Wales.

The Coffs Harbour Fishermen’s Co-operative’s chairman Andrew Gilbert said that both locals and visitors sought out fresh seafood sourced locally.

It follows the region being hit with a severe weather event forcing fishermen off the water ahead of the busy Christmas period reducing product availability.

But Mr Gilbert said it had been a great start to 2021.

“We thought we were going to have trouble this year with travel, but the Coffs Harbour markets have been full of people and they are all buying seafood.”

Mr Gilbert said the co-operative’s fresh seafood and hot food shops were flat out.

“People come down onto our wharves here. They watch the boats unload. They see the product come straight through the back door of the co-op and out into the front shops,” he said.

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China’s new plan to counter the US economy

Minxin Pei is professor of government at Claremont McKenna College and a nonresident senior fellow of the German Marshall Fund of the United States.

At the end of each year, the Chinese government convenes the Central Economic Work Conference to set priorities for the coming 12 months.

The importance and status of this annual event is underscored by the attendance of all seven members of the Politburo Standing Committee. Last year’s conference, which took place between Dec. 16 and 18, was a much-anticipated event because the business community wanted to learn what policies the conference would unveil to help achieve a robust economic rebound in 2021.

However, the news release issued afterward did not mention a growth target for 2021, nor did it contain references to macroeconomic policies that may boost growth. Instead, of the seven priority tasks set for 2021, four are explicitly connected to the strengthening of China’s economic security.

The contrast with the priority tasks set in the Central Economic Work Conference in 2019 which took place between Dec. 10 and 12 of that year is especially striking. The news release for the conference identified poverty relief, environmental protection, structural reform and other conventional economic objectives as priority tasks for 2020.

Of course, the coronavirus pandemic in 2020 upended Beijing’s old economic plans. But the puzzle about China’s economic priorities for 2021 is why its leaders have abandoned the goals it set a year ago even though they remain largely unfulfilled. Instead, they have embraced a completely different set of goals.

The answer must be found in the rapid deterioration in U.S.-China relations in 2020. As the trade war and tech war between the world’s two largest economies escalated after the outbreak of the coronavirus pandemic, Chinese leaders concluded that they must prioritize national security in their economic planning. In early April of 2020, the Chinese government began to draft its 14th five-year plan and formulate a long-term economic strategy. Xi personally headed the drafting committee, which also included Premier Li Keqiang and two other members of the Politburo Standing Committee.

The plan was approved by the fifth plenum of the Central Committee of the Chinese Communist Party at the end of October, and was made public in early November. Even a cursory reading of China’s new economic strategy for the next 15 years reveals the determination of China’s leaders to ensure national and economic security in an increasingly uncertain and hostile external environment.

Since 2021 is the first year of the CCP’s 14th five-year plan, the priority tasks for the year set by last year’s Central Economic Work Conference naturally reflect the two prongs of China’s new economic strategy: technological self-sufficiency and growth based mainly on domestic consumption.

Therefore, China’s number one and two priority tasks for 2021 are, respectively, “strengthening the nation’s scientific and technological capabilities” and “strengthening [China’s] capabilities of maintaining the self-reliance and control of production and supply chains.”

After the U.S. government cut off supplies of critical technologies such as high-end computer chips and software to a large number of Chinese companies in 2020, Beijing realized that it must mobilize the resources of a whole nation to ensure that the U.S. will not be allowed to “choke our neck” in the future. In the new year, we should expect China to launch an ambitious and generously funded program to beef up R&D and focus on building domestic capabilities in sectors now dominated by American companies.

The number five task, food security, also reflects the concerns of China’s leaders about overreliance on high-yield seeds produced by foreign suppliers. Three American companies, Monsanto, DuPont and Dow Chemicals, are among the world’s top five seed companies while China has only one.

A farmer plants seeds in a corn field in Gaocheng: the task of food security reflects the concerns about overreliance on high-yield seeds produced by foreign suppliers.

  © Reuters

The shift to domestic demand as the principal source of growth was listed as the number three priority for 2021. Chinese leaders hope to achieve this with measures to promote employment, improve social safety nets, expand middle-income groups and increase consumption in local administrative areas and towns. In his remarks in early April on the 14th five-year plan, Xi argued that the shift was necessitated by protectionism and would be feasible thanks to China’s vast internal market.

Investors in profitable Chinese tech giants like Alibaba Group Holding and Tencent Holdings should pay attention to priority task number six. The Chinese government has pledged to strengthen anti-monopoly measures and prevent “expansion of capital without order.” Since it is highly unlikely that the Chinese government will break up state-owned monopolies or duopolies such as China Petroleum & Chemical (Sinopec), China National Petroleum Corp., China Mobile and others, privately-owned tech giants will be the most tempting targets.

Indeed, Beijing launched an “anti-monopoly investigation” of Alibaba, the e-commerce behemoth, immediately after the conference. Its fintech subsidiary Ant Group may be broken up and placed under more strict state control. Other large private companies in e-commerce could face similar regulatory actions in the new year.

In all likelihood, China will make modest progress in bolstering its national and economic security in the new year. But that may not bother Xi. What really matters to him is that the rest of the world, especially the U.S., get the message that China is prepared to counter America’s economic offensive.

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Shedding A Light Into China’s Quantum Supremacy

AsianScientist (Dec. 29, 2020) – By carefully mapping out beams of laser light, Chinese researchers have demonstrated quantum supremacy—a lofty goal whereby quantum computers perform computations no classical computer can. Their results were published in Science.

Classical computers—the computers we use in our everyday lives—have gone a long way in the past decades. For instance, our smartphones have a hundred thousand times more computing power than the room-sized computers first used to send astronauts to the moon.

To create even more powerful computers, scientists are increasingly harnessing quantum phenomena. In classical computers, bits of information are traditionally represented using a strict binary of 0s and 1s. Through phenomena like superposition, the quantum bits or qubits of quantum computers can correspond to both 0 and 1 at the same time.

The ability to simultaneously process multiple states of information through qubits gives quantum computers the power to greatly outperform their classical counterparts in certain tasks. Consider boson sampling, an experiment that seeks to measure the random distribution of light particles or photons as they travel through an intricate maze. Such a set-up would take China’s fastest supercomputer, the Sunway TaihuLight, two billion years to compute.

In contrast, researchers led by Professor Pan Jianwei at the University of Science and Technology China built a quantum computing system that could perform boson sampling in 200 seconds. The system, called Jiuzhang, includes a custom-design laser device that generates photons as well as hundreds of prisms and mirrors to randomize the photons’ path.

There are other approaches to building quantum computers that do not use photons. For instance, in 2019, Google claimed quantum supremacy through its 53-qubit Sycamore quantum processor. Sycamore, which was built with superconducting circuits typically kept at ultralow temperatures, took a little over three minutes to perform a calculation that would have taken a supercomputer 10,000 years.

However, given the low-temperature requirements of superconductors, Google’s Sycamore guzzles much more power compared to the photonics-based approach of China’s Jiuzhang, which operates at room temperature.

Jiuzhang’s quantum supremacy represents another feather in the cap for Pan, hailed by some as China’s Father of Quantum. In 2018, Pan led pioneering experiments with China’s first quantum satellite Micius—like an unhackable video chat between Beijing and Vienna. At 1,400 kilometers, Pan’s team also holds the world record for the longest distance of quantum teleportation when they made a particle teleport from Earth to Micius in orbit in 2017.

“We have shown that we can use photons, the fundamental unit of light, to demonstrate quantum computational power well beyond the classical counterpart,” said Pan to Nature.

The article can be found at: Zhong et al. (2020) Quantum computational advantage using photons.


Copyright: Asian Scientist Magazine; Photo: Shutterstock.
Disclaimer: This article does not necessarily reflect the views of AsianScientist or its staff.

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With Concessions and Deals, China’s Leader Tries to Box Out Biden

A trade pact with 14 other Asian nations. A pledge to join other countries in reducing carbon emissions to fight global warming. Now, an investment agreement with the European Union.

China’s leader, Xi Jinping, has in recent weeks made deals and pledges that he hopes will position his country as an indispensable global leader, even after its handling of the coronavirus and increased belligerence at home and abroad have damaged its international standing.

In doing so, he has underlined how difficult it will be for President-elect Joseph R. Biden Jr. to forge a united front with allies against China’s authoritarian policies and trade practices, a central focus of the new administration’s plan to compete with Beijing and check its rising power. The image of Mr. Xi joining Chancellor Angela Merkel of Germany, President Emmanuel Macron of France and other European leaders in a conference call on Wednesday to seal the deal with the European Union also amounted to a stinging rebuke of the Trump administration’s efforts to isolate China’s Communist Party state.

The deals show the leverage Mr. Xi has because of the strength of the Chinese economy, which is now the fastest-growing among major nations as the world continues to struggle with the pandemic.

Noah Barkin, a China expert in Berlin with the Rhodium Group, called the investment agreement in particular “a geopolitical coup for China.” Chinese companies already enjoyed greater access to European markets — a core complaint in Europe — so they won only modest openings in manufacturing and the growing market for renewable energies. The real achievement for China is diplomatic.

China had to make only modest concessions to overcome increasingly vocal concerns about China’s harshest policies, including the crackdown on Hong Kong and the mass detentions and forced labor of Uighurs in Xinjiang, the western Chinese region.

China agreed, at least on paper, to loosen many of the restrictions imposed on European companies working in China, open up China to European banks and observe international standards on forced labor. The question is whether the pledges can be enforced.

To China’s critics, Mr. Xi’s moves have been tactical — even cynical. Yet they have also proved successful to a degree that seemed impossible only a few months ago, when several European countries became more outspoken in opposing China.

“It would be wrong to see these Chinese concessions as a significant shift in policy,” Mr. Barkin said. “Over the past year, we have seen the party tighten its grip over the economy, double down on state-owned enterprises and launch a new push for self-reliance. That is the direction of policy that Xi has mapped out and it would be naïve to believe that this deal will change that.”

Instead, China has demonstrated once again that it pays little or no diplomatic cost for abuses that violate European values. The Europeans finalized the investment agreement, for example, a day after the European Union publicly criticized the harsh prison sentence handed down to a Chinese lawyer who reported on the initial coronavirus outbreak in the city of Wuhan.

Australia faced a similar trade-off in November when it signed up for the Asian trade pact, the Regional Comprehensive Economic Partnership, even as China waged a campaign of economic coercion against the country.

China’s vast economic and diplomatic influence, especially at this time of global crisis, means that countries feel they have little choice but to engage with it, regardless of their unease over the character of Mr. Xi’s hard-line rule. The Asian trade pact, for example, while limited in scope, covers more of humanity — 2.2 billion people — than any previous one.

“The values we all cherish in our Sunday sermons must be adhered to if we are not to fall victim to a new systemic rival,” said Reinhard Bütikofer, a German member of the European Parliament who has spoken out against the European investment agreement with China.

“I think the understanding is increasing,” he added, “but how to respond is not yet clear.”

China’s overtures will not end the anger over its repressive policies, including its documented use of forced labor. They could mollify China’s critics, though, by using the lure of commercial profit in a country whose economy has rebounded from the pandemic more robustly than others’ have.

That would also undercut Mr. Biden, who already must overcome four years of frustration in Europe over President Trump’s go-it-alone approach as he confronts China’s actions at home and abroad.

“I think now is a very good window for us,” said Wang Huiyao, president of the Center for China and Globalization, a think tank in Beijing. He said China could serve as a model and as a partner in cooperation, and suggested that Europe could play a moderating role between China and the United States.

“Everyone has seen China’s resilience, its vitality, tenacity and its stability, especially through its fight against the epidemic,” he said.

Mr. Xi, of course, has not acknowledged that any of China’s policies have eroded global trust. Nor have officials signaled any reconsideration of its core policies.

The country’s “Wolf Warrior” diplomacy, named after a pair of jingoistic action movies, shows no sign of relenting. Australia still faces China’s wrath, as does Canada over the detention of the chief financial officer of the Chinese technology giant Huawei at the behest of the United States.

“I think they have a selective approach to mending their image,” said Minxin Pei, a professor at Claremont McKenna College in California.

Over the long term, it remains to be seen how significantly China’s pacts and pledges will improve its international image, which plummeted this year because of its obfuscation over the coronavirus outbreak in Wuhan.

A survey by the Pew Research Center in October found that in 14 economically advanced countries, unfavorable attitudes toward China had reached their highest levels in more than a decade. A median of 78 percent of those surveyed said they had little or no confidence that Mr. Xi would do the right thing in world affairs. (One upside for Mr. Xi: 89 percent felt the same way about Mr. Trump.)

China’s economic recovery has nonetheless given Mr. Xi a diplomatic opening, and he has seized it. Mr. Xi’s pledges to accelerate China’s reduction of carbon emissions, which he began making in September, have won international plaudits, even if the government has yet to detail how it will wean itself from coal and other heavily polluting industries.

Around the same time, Mr. Xi showed renewed interest in wrapping up discussions for the European investment agreement, which had been dragging on for seven years. Only months before, a deal seemed all but dead amid rising animosity toward China in Europe. “Real differences exist, and we won’t paper over them,” Charles Michel, the president of the European Council, said in September.

A breakthrough came after the American presidential election. Mr. Trump showed disdain for America’s traditional allies in Europe and Asia, but Mr. Biden has pledged to galvanize a coalition to confront the economic, diplomatic and military challenges that China poses.

China clearly foresaw the potential threat.

Only two weeks after the election, China joined the 14 other Asian nations in signing the Regional Comprehensive Economic Partnership. In early December, after phone calls with Ms. Merkel and Mr. Macron, Mr. Xi pushed to finish the investment agreement with the Europeans.

The prospect raised alarm, both in Europe and in the United States. Mr. Biden’s incoming national security adviser, Jake Sullivan, took to Twitter to hint strongly that Europe should first wait for consultations with the new administration — to no avail.

Critics said the deal would bind Europe’s economy even more closely with China’s, helping Beijing expand its economic might and deflect external pressure to open up its party-state-driven economy.

They said the agreement failed to do enough to address China’s abuses of human rights, including labor rights. The promise that negotiators extracted from China on that issue — to “make continued and sustained efforts” to ratify two international conventions on forced labor — assumes China will act in good faith. China, critics were quick to point out, has not kept all the promises it made when it joined the World Trade Organization in 2001.

The investment agreement must be ratified by the European Parliament before it can take effect, and it faces signification opposition that could derail it. For now, Chinese officials have celebrated a deal that Mr. Xi called “balanced, high-standard and mutually beneficial.”

“The Chinese leadership is concerned about a trans-Atlantic front, a multinational front, against it, and it is willing to make, I think, tactical concessions to bring the Europeans on board,” Mr. Barkin of the Rhodium Group said. “They’ve been very smart about this.”

Claire Fu contributed research.

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