China

What China’s Latest Cryptocurrency Crackdown Means For The Industry

Volatility is a natural facet of the speculative cryptocurrency market, wherein thousands of coins gain value through investor interest—developed through unstable factors like emotions and trends. Many governments have been wary about introducing digital money on a large scale, as instability can be destructive to both economies and the people involved in transactions. So while there hasn’t been a green light to “officially” use crypto for buying and selling, it’s an asset that’s tolerated by most of the world.

China’s government falls in the faction that isn’t enthusiastic about cryptocurrency, which, while decentralised, is still created by private institutions. Their lack of tolerance over coins has been an ongoing problem for the industry. In the last week of May 2021, Vice Premier Liu He echoed the need to crack down on cryptocurrency trading and mining in the country, prompting a massive sell-off that wiped billions off the exchanges—an event that has been well-documented by The Top Coins. Bitcoin (BTC) saw a $20,000 drop, Ethereum (ETH)’s value was cut in half by approximately 50%, and even Dogecoin (DOGE), which had been on a roll, hasn’t been able to break past $0.3 since the announcement.

China’s investors are used to the government interfering with their cryptocurrency trades. But Liu He is, so far, the most powerful person to speak against digital currencies. What are the implications of this move, and how will China and the world move forward with governments now actively stepping into and regulating the once lawless crypto zone?

Source:foxbusiness.com

China’s Shaky Relationship With Cryptocurrency

China and cryptocurrency go far back. The People’s Bank of China (PBoC) was one of the first agencies to declare digital currencies illegal, blocking all access and transactions through their financial system from 2009-2017. In 2013, when cryptocurrency began to emerge among enthusiasts, there were talks about Bitcoin prices being manipulated by Chinese traders who would short-sell BTC then buy massive amounts once they fell out of favour again—a process called ‘pump & dump.’

In 2017, the PBoC began allowing cryptocurrency exchanges to operate but still banned ICOs—a popular fundraising mechanism where companies ask for investments to issue their blockchain-backed tokens, often leading to a surge in share prices. It was done to protect Chinese investors from fraudulent schemes and risky ICOs.

In September of 2018, the government began taking more concrete steps by ordering Beijing-based bitcoin miners (BTMs) to cease operations after receiving complaints of excessive noise levels and pollution. Two months later, BTM operators were given an ultimatum: they must either stop mining or face closure and possible arrest if caught continuing their activities.

“Cryptocurrency is not legal tender of any country,” says Xu Zhusheng, Assistant Director at PBoC’s Legal Department and head of its Digital Currency Research Lab. “It can’t be circulated in the market as currency.”

A Futile Effort

Despite China’s numerous attempts to crack down on cryptocurrencies over the past decade, most of their warnings fell on deaf ears. The country still owned 65% of the Bitcoin mining hash rate and was home to two of the world’s largest mining pools. Despite heavy crackdowns on crypto use, it remains one of the top countries for Bitcoin trading, all thanks to third parties that continued to help miners and investors buy, sell, and trade their coins in the shadows. Crypto operated underground—through VPNs, international connections, and middle-men.

Beijing Gets Serious

Source:qz.com

Following Vice Premier Liu He’s announcement to crack down on cryptocurrency-related activities, Beijing was first to make a move, forcing some of the most influential players in the local crypto industry to fold. One of the largest exchanges, Huobi, suspended cryptocurrency trading and mining from new clients, stating that they’ll be focusing on international markets moving forward. Two of the largest mining pools have also backed down—BTC.TOP is no longer continuing its operations in China, while HashCow has suspended its services from new miners and stopped buying rigs.

While the crackdown at the height of the bull market seemed unprecedented, the government began making moves months ago. In mid-January, the government ordered Beijing’s three power grids to stop providing electricity for new Bitcoin mining operations. The announcement impacted thousands of miners who were already working in some lucrative mines outside the capital city—and it was just the beginning. A month later, on February 15 at midnight, authorities suspended trading on all cryptocurrency exchanges and blocked access to 124 websites that provided information about cryptocurrencies or offered trading services, such as hosting marketplaces or ICOs.

The subsequent crackdown has left many people scrambling to figure out what this means for China’s economy and its future stability within the global community. However, some investors remain unaffected—they’re continuing to support cryptocurrency and are investing through the shadows, albeit more cautiously and with more limited resources than before.

How is The Crackdown Affecting China & The World?

Source:reuters.com

Huobi Mall was the first to demonstrate that shifting focus to overseas markets is possible for cryptocurrency businesses. Given the government’s power, it’s extremely risky to continue investing in coins, and notorious companies are particularly easier to catch than individuals.

A dwindling Chinese mining community means more opportunities for international Bitcoin miners, as there are less competitors to fight against. However, with less crypto interest among one of the world’s largest consumer groups, coin prices have been hard-hit—the market has yet to return to its bullish values from mid-April. And despite censorship and major efforts to shut down crypto businesses, many enthusiasts remain unfazed and are continuing business as usual—though there’s no certainty in how long they can keep up a facade.

The government has had a long history of limiting crypto use within the country, but this time, their approach to regulation seems more intense than ever before. While its long-term effects in China and the rest of the industry remains unclear, successful government intervention may send signals to the rest of the world. More likely than not, an era of regulations may wash upon the cryptocurrency shore—starting from Turkey’s recent ban that disallows residents to buy and sell goods and services with crypto.

However, crypto remains part of one of the world’s largest technology markets. It’s not likely for coins to be phased out of existence due to their influence in the metaverse—from helping countries like El Salvador with cross-border payments to introducing tokens that power blockchain technology. It’s also an asset class continuously gaining acceptance from financial institutions worldwide, including Goldman Sachs and PayPal. So while governments may start rolling out regulations, investors will likely not have to worry about a global phase-out any time soon.

Important Areas to Focus on when Starting a Business in China

Starting a business in China, like every other place, comes with its unique challenges. This is not surprising as everything about China differs from what is available in the Western World.

As a result, one needs to prepare extensively if the business will have a smooth sail in China. Here are critical areas to focus on:

1. Have a Business Scope

Source:worldipreview.com

It makes no sense to simply go to China and start a business. It is expected of you to have a detailed plan of what you want to do and steps to achieve it.

This comes back to your business plan.

Your business plan gives your business a blueprint. As a result, if your original intention of opening a WFOE is to start a supermarket, you cannot switch to a mobile phone business later. This will come back with grave consequences.

2. Get Help with taxes

In other words, enlist the help of a professional that can help you stay on top of your taxes. It can be a local accountant or an outsourcing company. You have got to be tax compliant to remain relevant in doing business.

Even if you feel you want to cut corners, be sure that the country does not joke when it comes to taxing foreign firms. If you desire to start a company in China, be sure to have the right intentions.

As a result, local help will go a long way in ensuring that you get it right with payroll, bookkeeping, invoicing, and your tax.

3. Take care of your Work visa

Source:hoticn.net

Your Chinese visa has a direct link with the local authorities and tax agencies. As a result, you need to get your visa in order.

While it is possible to apply for a Chinese Visa yourself, make sure you get help from professionals. Like taxes, payroll, and others, you are better off enlisting an expert’s assistance to help with your tax.

4. Brace up For China’s Internet

For many companies in another part of the world, the internet is an essential and indispensable part of business success. This also applies to China but in a different way.

What makes China different is that most eCommerce websites, social media sites, and channels we use to sell are not the same in China.

Facebook and Google are common platforms indispensable to the success of many businesses and startups. These two are, however, not present in China.

In starting a business in China, be ready to change your approach to the internet. This means a world without Google.

5. Chose the Right Company Type

As with many countries, there are many forms of business in China. With this, be sure to ask the critical question which will help you structure your business. Your company structure determines many things about it, such as taxes, size, mode of operation, etc.

Here are the types of company forms available in China:

  • Joint Venture
  • Representative Office
  • WFOE (Wholly Foreign-Owned Enterprise)

6. Get Permit

Apply for a certificate of approval for the establishment of a foreign-invested enterprise. First, you need to declare the project approval, then submit the feasibility report, contract, and articles of association, apply for approval to the foreign economic and trade approval agency, and obtain the approval certificate.

7. Industrial and commercial registration

Before obtaining the foreign-invested enterprise approval certificate, the enterprise name must be pre-approved. Fill in the “Application for Pre-approval of Enterprise (Company) Name”, and apply for the retention of the company’s company name to the industrial and commercial department with the signature or seal of the shareholder (signature of natural person shareholder and seal of legal person shareholder), and obtain the “Notice of Pre-approval of Enterprise (Company) Name” ”

8. Procedures for the organization code

After obtaining a business license, a foreign-invested enterprise shall apply for an organization code certificate from the Technical Supervision Administration. The following materials must be submitted: “Organization Code Declaration Form”, original and photocopy of the approval certificate, original and photocopy of the business license, ID card or passport and photocopy of the legal representative.

9. Land use procedures

Obtain the production sites of foreign-invested enterprises through signing a land use agreement or plant lease agreement. To obtain land use rights, foreign-invested enterprises need to go through land use procedures with the land and real estate management department.

10. Handle foreign exchange registration procedure

Source:fdichina.com

A foreign-invested enterprise shall, within 30 days from the date of issuance of its business license, go through the foreign exchange registration procedures with the foreign exchange administration of the place of registration and obtain the Foreign Exchange Registration Certificate of Foreign-invested Enterprise. The following materials (copies) shall be submitted: the contract that has become effective as approved by the approval authority, Articles of Association; approval certificate issued by the approval authority; business license and copy issued by the Administration for Industry and Commerce. After reviewing the above documents, the State Administration of Foreign Exchange will fill in and issue the Foreign Exchange Registration Certificate for Foreign-invested Enterprises.

11. Tax Registration

A foreign-invested enterprise shall, within 30 days from the date of obtaining a business license, declare to the competent tax authority for tax registration with the following materials (copy): a copy of the business license issued by the Administration for Industry and Commerce; contract, articles of association and its approval documents; approval authority Approval documents issued; feasibility study reports and approval documents; list of corporate board of directors, etc.

12. Customs filing procedures

Foreign-invested enterprises need to submit the following materials for customs declaration registration: approval certificate issued by the approval authority; business license issued by the Administration for Industry and Commerce; enterprise contract and articles of association; list of approved imported equipment; enterprise capital verification report, etc.

Conclusion

Source:daxueconsulting.com

To successfully have a business in China, you have to be prepared and get all the helps you can.

The points we discuss here can go a long way in setting you on the right path. China is a vast country with tremendous opportunities. As a result, you need to visit China and see things for yourself.

If you need a Chinese visa, Check at https://visaexpress.com/visa-for-china-from-us/. We are skilled at handling every detail of your visa process to ensure a guaranteed approval

Relocating for Work in China? Expat’s First Steps

China has been attracting people from all over the world, so it’s not surprising some consider moving there. The country is famous for transforming itself from a developing area with millions of poor citizens into a powerful and technologized machine that now produces over half of the overall world’s goods.

So, what do you need when relocating to China for work? What is the cost of living there for a year? Are there any guidelines you should follow during the transition? If you’re an expat and planning to move overseas for a new position, this article will provide you with essential info you should know.

Most westerners moving to China have claimed that getting a job is easier than they expected. The most straightforward job for expats is within the English teaching sector because organizations and educational facilities are always searching for native speakers. You don’t even need to speak Chinese to apply for an English teacher position. But if you’re applying for a manager or engineer position, you need to speak some Chinese to communicate with your co-workers easily.

Without much ado, here are the steps you should follow when you plan a relocation to China.

Visa regulation when moving to China

You need a visa when you plan to move to China for work. Chinese authorities have adopted a new law according to which your visa history impacts the counselor’s decision to issue or renew your visa. You can apply for one of four types of visas when you plan to immigrate to China.

– Chinese working visa. To obtain it, your employer must provide you with a work permit. When you arrive in China, you need to register with the police station in your area and get a residence permit.

– Business visa. Apply for this visa if you are traveling overseas to engage in commercial activities or start a business.

– Chinese study visa. You can choose from two types of visas X1 and X2. Both are created solely for students, so you cannot apply for one and gave up school when you arrive. The X2 visa provides a single-entry to the country, and you can use it for less than 6 months. The X1 allows you to enter the country multiple times and stay longer (during your bachelor’s or master’s program with a local university).

– Chinese tourist visa. To get a tourist visa, you need to prove your hotel reservation and vacation plan and documents to prove you have enough funds in your bank account to visit the country.

Visa regulations are frustrating, and the process can be lengthy (it can take up to 2 months), so it’s best to hire a consultant to guide you through the process.

Source:studyinchinas.com

Find accommodation

As everywhere around the world, the rental and housing prices fluctuate throughout China. If you’re relocating alone, a one-bedroom apartment is more than enough, and it can cost around $300 monthly. But if you’re moving to China with your family, expect to pay somewhere between $800 and $1000 per month for a three-bedroom apartment. The average price per square meter to buy property in China is $7000 (in city centers).

Most rentals provide TV and Internet access, but to ensure you browse the Internet securely and the Government doesn’t surveil your activities, get a VPN. Visit this page to check the top of the best VPN services in China. As an expat you may want to use websites like Facebook, Instagram, or Netflix, but China restricts its residents’ access to specific websites, so you need a VPN to remove geographical restrictions on content.

The cost of living in china isn’t high, and the average salary for an expat is from $1700-2500. Relocating to China for work can be an opportunity to save money. Most foreigners prefer living in big cities like Tianjin, Shanghai, Guangzhou, or Shenzhen.

Apply for a job

Source:hotels.ng

As you already know, China is the world leader in manufacturing, having the highest number of factories worldwide. As an expat, you can easily find a decent job in any industry, from agriculture to healthcare, IT, mining, and textile. Even if most Chinese are qualified in their profession, the country is actively attracting foreigners looking for a well-paid job in sales, finance, marketing, or teaching. As stated before, most expats occupy English teaching positions in China, and if this is the career path you want to follow, you need a TEOFL certificate in advance to meet educational institutions’ criteria.

If you’re an entrepreneur who wants to start a business in China, you’d be happy to find that the country is rich in talented professionals.

Even though the country provides expats with many job opportunities, knowing how to find the right position for you is essential. To get a job in the principal cities, you need at least two years of experience after obtaining your university degree or PhD. If you lack experience, relocate to a smaller city where the job requirements are less strict. You can also apply for an internship with an international company to gain experience.

Healthcare

Source:bain.com

China’s national healthcare system operates under the state social insurance plan, but it’s not free. This means you can obtain basic insurance coverage without too much hassle if you’re willing to pay. In general, health insurance covers most medical issues and procedures, but it’s recommended always to ask the medical expert you visit if you must reimburse the procedures.

Suppose you’re suffering from a chronic condition. In that case, you may not find the Chinese healthcare system suitable to treat your medical problem because the public system isn’t as developed as the ones from European countries, the USA, or Canada. Chinese people still appreciate the benefits of traditional rituals and healing practices. So, if you use a specific treatment scheme to alleviate your symptoms, check ahead if you can stick to it once relocating to China because the local doctors may not be able to prescribe you the same drugs because they lack from their healthcare system.

Check with your employer if they offer any type of health insurance, and what conditions it covers because you may need to purchase an additional policy.

Are CPEC-linked Property Rate Hikes in Pakistan Short-lived?

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Investment security figures as a major concern for foreign investors who contemplate benefiting from Pakistan’s emerging role in the global economic and trade designs of its domineering Chinese neighbour up north. The two countries signed a USD 46 billion China-Pakistan Economic Corridor (CPEC) agreement back in 2015. And since then, the Pakistani state and its administered peoples have considered CPEC to be the long-awaited saviour for their nation’s seemingly never-ending economic crises.

In the absence of an apparent and business-conducive regional environment, a number of investors have recently been left wondering whether the current CPEC-related property hikes in Pakistan are – indeed – short-lived. And according to most economic experts who are familiar with the turbulent financial history of the country, their reservations regarding the sustainability of the said price increments are warranted. Especially when the developments planned under the CPEC initiative are looked into individually – and not in their political and media-aggrandized totality.

Here is a quick overview of what CPEC holds for Pakistan in terms of property (and other infrastructural) developments.

CPEC-related infrastructural developments planned in Pakistan

source: weforum.org

According to a 2017 report featured on CNN International, CPEC – being an integral part of China’s One Belt, One Road initiative – has come with a ‘mega opportunity’ for Pakistan to develop its economy. The said article briefly makes mention of the projects planned under this corridor; which include, broadly, the development of road networks, railway lines, fibre-optic cable connections, a deep-sea port, solar farms, and coalmines.

As per the Pakistani government’s official CPEC website, the more prominent of these predominantly Chinese-sponsored concerns include:

source: pcq.com
  1. The main CPEC route (a 3,000 kilometres-long road connecting Gwadar with the China’s Xinjiang province)
  2. An upgrading of the existing Pakistan Railways Main Line (ML-1)
  3. The New Gwadar International Airport
  4. The development of Special Economic Zones (SEZs)
  5. A Gwadar Eastbay Expressway
  6. Water treatment plants, and facilities for water supply and distribution
  7. A ‘Pak-China Friendship Hospital’ facility
  8. A Gwadar ‘Livelihood Project’
  9. The Bao Steel Park, and the establishment of stainless steel, petrochemical, and other local industries
  10. The Gwadar University
  11. A Gwadar ‘Smart Port City’ Master Plan
  12. Matiari-to-Lahore & Matiari-to-Faisalabad transmission line projects
  13. Power plants in Port Qasim
  14. The Hydro China Dawood Wind Farm
  15. The Suki Kinari Hydropower Station
  16. Engro Thar Blocks I & II
  17. Coal-based power projects in Gwadar
  18. The Quaid-e-Azam Solar Park
  19. The Jhimpir Wind Park
  20. The Sachal Wind Farm
  21. The Karot Hydropower Station
  22. The Hub Coal-fired power plant
  23. The Western Energy Wind Power Project
  24. The Kohala Hydel Project
source: pcq.com

An ambitious construction gig!

Some of these projects have been already completed, while a majority are slated for construction & operation in the next couple of years. But knowing the unrelenting pace of Chinese industry, these other developments may come around into fruition perhaps sooner than is expected.

The impact of CPEC on Pakistan’s property market (as a whole)

source: brandsynario.com

For any foreign analyst bent on critically examining this causality, undermining the positive impact of the above-mentioned development projects on Pakistan’s property market would be unfair.

If we consider the case of the 3,000 kilometres-long CPEC Route alone, as soon as its section near Karachi (the country’s traditional port city) was finalised, the real estate situated in the adjoining areas experienced major price hikes due to a sudden outpouring of demand among property investors and developers. The same trends were further reported from all the major towns located along the said route.

While the CPEC Route is further divided into its Central, Eastern and Western sections (and will be developed as such), many other highways and road networks will be constructed in Pakistan in conjunction.

As a general property price appreciation principle, the development of road infrastructure is one of the major factors that trigger price hikes in any area; no matter how remote it is. So these consistent real estate investment breakthroughs, spurned by this created proximity, are not surprising. And this rule applies to all kinds of property, be it barren land incapable of much crops cultivation, agricultural land, or land that may be reserved for special purposes.

Landowners who are lucky to have the main CPEC Route, or its connecting road networks, pass through their land are now looking at guaranteed long-term investment returns.

On an interesting side note, the heightened current and expected demand of property in Pakistan has given birth to many new online real estate portals, including the recently launched Prop.pk. At the same time, the existing market contenders are keenly preparing to attend to the people seeking quick information on picking the right property investment options in the country (in the backdrop of CPEC).

How did Gwadar’s property market – specifically – respond to these developments?

source: dawn.com

Despite how vigorously the government’s infrastructure projects in Gwadar are being carried out at the moment, the real estate market in this port city remains active only a couple of times a year. Its performance flares up mostly when overseas Pakistanis return home for their annual holidays, or during the start and end of a given year. In other words, property demand here attains a noticeable boost when the city receives visitors.

Observing this trend, many hasty analysts tend to assume that the prices deflate during the remaining parts of the year. This conclusion, however, is not borne out by the ground reality.

A property investment gig in Gwadar is not a short-term affair, and most experienced investors are aware of this fact. For each property purchased for investment (non-residential) purposes here, the usual intention behind the decision to is to hold it for a medium to long-term duration – roughly spanning 3 to 5+ years. And since most of these investors normally come with good holding power, prices here don’t experience major drops in the absence of new stakeholders.

According to the stats maintained by Zameen.com, Pakistan’s leading real estate portal, property rates in Gwadar have gone up by 67.65% since July 2016. And if you’ve been following the country’s real estate market closely, you may recall that this was the same time when the former government introduced a new property tax collection regime that brought a considerable drop in aggregate real estate investment volume.

But even in these harsh investment conditions, Gwadar’s property market continued to battle on and retain much of its real estate value; a testament against the notion that the CPEC-related rates hike in Pakistan is short-lived.

How does the property market in Pakistan currently fare?

source: bohatala.com

Due to the introduction of the new property tax collection mechanism introduced in 2016, real estate investments in the country (as referenced) have taken a major hit. Major price drops have been recorded in projects and locations that were previously considered to be ‘investor favourites’. And this development has nothing to do with CPEC, since the projects in question hold no direct association with the economic corridor.

As some token of providence, this situation conversely spurned genuine buyers to take the lead in buying property for their genuine residential (and not sales-oriented) needs. The high real estate demand among these end-users, in fact, has kept the market from experiencing a complete crash-like situation. And nowadays, instead of experiencing sharp price hikes based on speculative investment trends (as was previously the case), the market tends to record a gradual yet consistent rise in property rates across the country.

This trend has also been reported by non-Pakistani sources. A 2018 article published by Khaleej Times further goes on to detail how property buying stats shifted when the current government imposed certain sanctions on non-filers looking to buy some local real estate.

Cautious, yet zealous, expectations…

source: scmp.com

The current pace of market activity indicates that Pakistanis, for the most part, are aware of the rising worth of real estate in their country.

Their optimism, if you ask any typical middle class worker going about his (or her) daily routine, largely rests on the country’s economic transformation which CPEC promises to catalyse and usher in. And while these feverishly anticipated developments may not offer them many desirable gains in the short-term, the returns on investments in the long-term, they reckon, will be totally worth the wait.

It is clear that they have affixed their future with weighty expectations.

Only time will tell what will become of them.

Rising rates of the contest: Huawei Appeals to the Court for the USA

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Recently the US authorities have forbidden national agencies to collaborate with companies, that use the equipment of Huawei Technologies (HT). It followed that HT appealed to the Texas District Court claiming that the US authorities are acting illegally, and the imposed limitations are unconstitutional. Guo Ping, a company executive, noted that the National Congress did not give any proofs to support the accusations.

source: vcnewsnetwork.com

The company considers unconstitutional the prohibitions to US national structures from buying HT equipment, appealing section 889 of the National Defense Act. Meanwhile, private companies of different size are asked to use reliable communication systems or even try free sip account as provided here.

Growing Support

The US authorities have called other governments to abandon the company`s equipment when creating fifth-generation mobile networks for security reasons. In their opinion, the company can collaborate with the intelligence service of China and use its equipment for cyber espionage. Also, US defense experts have expressed concerns about the company’s involvement in the submarine cables laying. They believe that the Government of China will be able to intercept traffic and even interfere with the Internet work with the HT equipment.

source: boardingarea.com

 NATO`s Respond

NATO is aware of the potential “security implications” of using Chinese 5G infrastructure and is currently evaluating possible risks.  Close consultations on this issue, in particular, the security of investments in 5G networks are holding,” stated NATO Secretary General Jens Stoltenberg.

The commander of NATO forces in Europe, General Curtis Scaparrotti, said that the North Atlantic Alliance could break the link with its German counterparts if they decide to work with HT in developing 5G.

source: vokrugsveta.ua

Submarine Communication Cables

Struggling for the global networks control opened a new front in the US-China relationship. US defense experts are concerned about the vulnerability of submarine cable systems, which can be used for espionage. As Huawei is involved in the creation of the system, the situation becomes even more complicated.

While the United States take measures against HT to prevent it from creating 5G mobile communication networks, it is strengthening position in creating a submarine cables system that carries almost the entire amount of Internet information. Joe Kelly, a spokesperson for Huawei, noticed that the company is privately owned and “no government has ever asked for anything that would endanger its customers or business.”

source: androidpolice.com

 Plans for Future

The Chinese company has developed its own operating system in case of inability to use the Android OS and Windows due to a conflict with the US authorities.

The techno giant began its work on creating an alternative OS in 2012. It was a necessary measure for responding to the US investigation over HT and ZTE activities, suspected of spying for Beijing’s Government.

Huawei Technologies is still one of the world’s largest telecom companies. The annual revenue of the company reaches $ 100 billion, and net profit is over $ 7 billion.

Chinese New Year Traditions

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China is one of the oldest countries in the world, with its history dating back thousands and thousands of years. China has at least eight different linguistic groups, with hundreds of dialects. China is a very big country in terms of population, and as we said, traditions date back thousands of years. With all those factors in play, traditions tend to be different at some parts of the country. Namely, Chinese New Year traditions are different in large parts of the country, are we are going to tell you all about them.

1.    Chinese New Year’s Eve Dinner

In Chinese tradition, the New Year’s Eve Dinner is the single most important tradition for Chinese people. Like most parts of the world, celebrating New Year’s Eve dinner is all about reuniting with family, especially for those that are coming a long way from home. During the course of the dinner, fish is mostly served, with dumplings being the most important dish. Other foods are served based on personal preference, but the former are especially important to parts of Northern China. Fish and dumplings are dishes that celebrate prosperity, and another important Chinese tradition is to celebrate New Year’s Eve at home, rather than at a restaurant or other food establishments.

2.    Fireworks

Fireworks are an important part of China itself. Chinese are especially famous for their magnificent display of fireworks (remember the Olympic Games in Beijing, China, 2008). This is because fireworks are used to drive away the evil spirits in Chinese traditions. After 12 pm on Lunar New Year 2019, fireworks are launched to celebrate the upcoming year, as well as, to protect them from the evil spirits. Old Chinese traditions state that whoever launches the fireworks, will bear good luck throughout the year.

3.    Shou Sui

A common Chinese phrase, Shou Sui means “after the New Year’s Eve dinner.” After dinner, people will stay up to enjoy the fireworks. An old Chinese legend says that a legendary mythical beast named “Year” will harm any man, woman, child, and animal, that it encounters during the New Year’s Eve. The legend also states that the beast is afraid of the color red, fireworks, and loud sounds, therefore, during the New Year’s Eve, thousands upon thousands of fireworks will be launched, lots of celebratory noise will be made, and red flames will be lit in order to protect themselves from the beast.

4.    New Year Market

After the start of the New Year, a common Chinese tradition states that a market will be set up in order to continue the selling of food, clothes, fireworks, and arts.

5.    Red Packets

Many Chinese traditions focus around the banishment of evil spirits, and this one is no different. Namely, a red packet is a red envelope filled with money ranging from a few hundred to several thousand Yuan. These packets are given to married couples and elderly to young children, and it is said that the money inside will banish the evil spirits from their children, as well, as keep them healthy and give them longevity.

6.    Cleaning

In old times when bathing was not a common thing, people would bathe at the end of the year in order to welcome the New Year. In today’s age, Chinese people will do a full house cleaning in order to remove the old year and welcome the New Year.

Xinjiang Issue and China’s Public Image in Pakistan

Xinjiang Issue and China’s Public Image in Pakistan by Dr. Khuram Iqbal

On November 2nd, 2018, Pakistani Prime Minister Imran Khan is heading to China for a meeting with the top Chinese leadership. Besides concessional loans for Pakistan, both sides are expected to take stock of issues ranging from “Make in Pakistan” to Naya Pakistan Housing Project and Islamabad’s space program that aims to dispatch its first astronaut into space by 2022. Imran Khan is also likely to request Chinese assistance for his ambitious poverty alleviation program.

There are few loose ends with regards to CPEC that both sides will work to tie up. The PTI government intends to convince the Chinese side to priorities hydropower projects instead of coal-fired energy projects, including the western route project (Dera Ismail Khan-Yarik-Zhob road) in CPEC and most significantly revise the financing model of the $9 billion ML1 project on Build-Operate-Transfer basis. Previously, the multi-billion project under CPEC was to build on the Engineering-Procurement-Construction (EPC) model that shifts the entire financing risks to the federal government.

None of these issues is insurmountable. Beijing has already indicated that the new government’s demands are within the cooperation scope of the B&R initiative and China is willing to adjust the CPEC projects based on Pakistan’s needs. Laying to rest Malaysia-like speculations, Chinese Foreign Ministry spokesperson stated that China will make the PM’s visit a “complete success.” By assuaging Pakistan of her economic crises in a timely manner, and addressing her concerns on the mega-project, Beijing stands to strengthen its image of a “savior and an iron-friend” in Pakistani public opinion.

image source: ft.com

There will certainly be no shortage of ardor when the leaders from both sides meet. One can also expect the sort of romantic sloganeering such as “higher than mountains, deeper than oceans, sweeter than honey and stronger than steel” that has become the hallmark of the bilateral relations. Behind this enthusiasm, however, looms a growing threat, which many in Pakistani and Chinese policy-making circles continue to overlook. Reports on Beijing’s purported forced re-education programs for Muslims of Xinjiang are depriving China of her hard-earned public goodwill in the country, where there are frequent displays of solidarity with Muslims suffering elsewhere in the world. The government’s inaction on such issues is often manipulated by terrorist organizations to expand their recruitment base among a large pocket of the Pakistani population, which considers its religious obligation to respond to the sufferings of Muslims anywhere in the world.  Xinjiang could have a similar radicalizing impact on Pakistani population as other international issues such as Palestine, Kashmir, Afghanistan, Iraq, and Chechnya have always had.

Although mainstream Urdu media often avoids adverse reporting on China, some segments of the country’s English press have been vocally opposing Chinese counter-terrorism approach as “heavy-handed.” Moreover, with the advent of social media Pakistani public is also exposed to Western media campaign criticizing China for forcefully re-educating millions of Muslims in thousands of schools established during recent years across Uighur Autonomous Region. Such a systematic media campaign can potentially revive pan-Islamism in Pakistan and galvanize public support for the Muslim minority chafing under Chinese policies. There is also a genuine fear that militant groups may manipulate anti-China mantra to justify targeting CPEC-related projects in the future.

What needs to be done to avoid such a scenario. Firstly, Beijing needs to come openly about her counter-terrorism policies in Xinjiang. There are, no doubt, number of reasons to be fully on guard. Multiple factors had contributed to making the Uighur area a hotbed of extremism.  Beijing’s deliberate use of this region as a recruiting and training ground for anti-Soviet Jihad during the Cold War, Soviet Union’s attempts to use Uighurs to split China, Xinjiang’s close geographic proximity to Afghanistan, and years of neglect by the central government made Xinjiang as vulnerable to extremism as Pakistan’s tribal frontiers. To avert the minutest possibility of Xinjiang turning into “China’s Syria or Libya,” the Chinese authorities adopted a strategy that reflects a fine combination of hard and soft CT measures. As far the hard measures are concerned, Chen Quanguo, the party secretary of Xinjiang and the man known as the architect of Beijing’s Xinjiang Strategy, established thousands of centers to for “de-extremification” of the vulnerable population through education in law, Marxism and vocational training. His approach is often termed “heavy-handed” by the international observers. But the official narrative rebuts such claims by citing a sharp decline in acts of terrorism since he took charge in August 2016.

image source: economictimes.indiatimes.com

Initially, Chinese authorities refused to admit the existence of such facilities and defended their CT policies through a series of op-eds in a number of Chinese news outlets. However, a few weeks ago, Shohrat Zakir, chairman of the Government of Xinjiang Uygur Autonomous Region, acknowledged the “vocational education and training program” to fight “three evil forces of extremism, terrorism, and separatism.” Similarly, last week a group of reporters affiliated with “Global Times,” the mouthpiece of Communist Party of China was taken to these facilities. The tabloid reported that “trainees receive free vocational training to improve their command over the country’s common language, national laws and regulations, and vocational skills, among others.” The Western media saw these reports as Chinese cover-up and damage control attempts to avoid further embarrassment ahead of UN review on November 6, 2018.

As the West and China lock horns on the issue of Xinjiang, Pakistani government may come under increased pressure to adopt a stance that does not only appease the religiously inclined domestic constituency but also safeguards its relations with China. Shielding public from “anti-China narrative” is certainly not going to work.  With a growing chorus between policymakers, media houses, and academia of the two countries, there is a need for a frank exchange of views on the issue of Xinjiang, which according to Chinese narrative can serve as a case study on countering extremism through development and re-education.

As Pakistani public is increasingly exposed to diverse views on China, CPEC and Xinjiang through traditional and social media,  it’s going to take a lot more than good intentions to sustain a friendship that is “higher than mountains, deeper than oceans, sweeter than honey and stronger than steel.”

Article written by Dr. Khuram Iqbal.

Russia and China are Killing US Dollar

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According to Russian Foreign Minister Sergei Lavrov, countries which are under the sanctions should start doing business in their national currencies, as he suggested on Tuesday. Other than Russia, countries which can opt for such a move are also Iran and Turkey, and this means that the days of the US dollar as the international reserve currency could come to an end.

The person who will be the happiest about it is President Donald Trump. Why Trump?

Yale economist Robert Triffin explained in the 1950s that when a currency is the international reserve currency, it runs a current account deficit. In case of a replacement, it is more likely to have trade surpluses, which is what happened when the US dollar replaced the British pound in the 1920s and which is what POTUS aims for.

Currently, all over the world, nations use the dollar as the currency to trade with each other. When purchases oil from Iran, they use the US dollar to complete the transaction. Basically, more US$ flow out of the country than it flows in and that creates a big current account deficit.

With the dollar as the international reserve currency, we have a thing called “monetary seignorage.” In other words, it is what the US government earns with all of those dollars circulating around the world, outside of the US. It is a minimum cost to print money whereas countries which use $ such as China and Russia pay the full value of it in goods and services.

But not everyone wants to see the dollar as the world’s currency. As China claims, the international role of the US dollar was one of the things that caused the financial crisis ten years ago. There was a chance back then for another currency to replace it, but none did.

Let’s jump to the present. Last week, Trump reimposed sanctions on Iran and he said that any company which is doing deals with the Iranians in dollars would also be hit by sanctions. Also under sanctions are several Russian companies.

Lavrov visited Turkey and he told at the press conference that “unilateral enforcement measures are illegitimate in international affairs,” which is a clear reference to the sanctions imposed by the USA. “One way to counter these illegitimate barriers and restrictions is we can use national currencies on our bilateral trade,” he concluded.

image source: america.aljazeera.com

According to Lavrov, Russia has already switched to local currencies when they strike trade deals with countries such as China and Iran. He also believes that a large number of other countries will start doing the same. “I strongly believe that abuse of the role the U.S. dollar plays as an international currency will eventually result in its role being undermined,” Lavrov said. “A growing number of countries — even those not affected by US sanctions — will more and more stay away from the dollar and will rely on more reliable partners using their (own) currency.”

To some extent, Lavrov is right. But will the Chinese be content when they receive the payment in Turkish lira, knowing that the currency will be worth much less by the time the ship reaches its destination? What the US dollar has that no other currency can guaranty: It is safe, dependable and easy to exchange.

We mentioned that this change in role for the US$ is making Trump happy. While he may be thrilled with lower trade deficits because the dollar loses its role of being the international reserve currency, this is not going to happen soon. We will still have to wait for a major change when it comes to the international currency and at the moment none can replace the US dollar.

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