Emphasising the Two Establishments - New Guidelines on Quality Development - Cui Hongjian on EU-US Tussle over Inflation Reduction Act - My Take on Great Power Competition in the Indo-Pacific
Dear subscribers,
Before we get to today’s edition, I’d like to quickly address two things. First, I skipped yesterday’s edition since there was nothing that I thought was useful to cover.
Second, I am sharing below a document that I’m putting together on the nature of great power competition that we see emerging, with a particular focus on the Indo-Pacific. You can think of this as brewing thoughts; rather than a finalised assessment.
It would be great to hear from you on some of the ideas discussed in the document, and I am open to collaborating to develop this into something more substantial.
Cheers,
Manoj
Here are the stories and pieces that I found noteworthy from the Tuesday, February 7, 2023, edition of the People’s Daily.
Page 1: At the top of the page is a brief report on Xi sending messages of condolence to the leaders of Turkey and Syria on the earthquakes that have hit those countries. On Page 3, there’s a statement from CIDCA offering aid and humanitarian assistance for the two countries. Elsewhere, Xinhua reports that the Red Cross Society of China has decided to provide the Turkish Red Crescent and the Syrian Red Crescent with $200,000 cash respectively as emergency humanitarian assistance.
Next, the paper today carries the full guidelines for improving the overall quality of the economy and pursuing high-quality development. The document outlines the following main objectives. First, by 2025, the overall quality level of development will be further improved. This includes:
Overall economic structure improvements, such as improvements in innovation ability and reduction of energy per unit of GDP.
The competitiveness of industrial quality will be continuously enhanced. This entails addressing quality bottlenecks restricting industrial development, modernisation level of industrial and supply chains, developing more competitive industries and industrial clusters
The quality level of products, projects and services will have been significantly improved.
Great progress will have been made in brand building for Chinese brands.
More modern and efficient infrastructure of quality would have been built. This also includes having clearer and coordinated standards, certification and accreditation, inspection and testing criteria and processes.
Overall quality management system would have been further improved.
By 2035, China will have formed a more solid foundation and developed an advanced culture for quality development, and its comprehensive strength in terms of quality and brands will reach a higher level.
This is followed by separate sections dealing with each of the aspects mentioned above. It’s really difficult to do a summary of these, since there are broad objectives in each that have been listed rather than specific, measurable goals. I’ll share a few to give a sense of what I mean.
Section 3 discusses promoting quality and beneficial economic development. It covers establishing an innovation ecosystem integrating government, industry, university, research and applications, improving the quality of industrial chains and supply chains, making breakthroughs in a number of major landmark quality technologies and equipment, pursuing digital empowerment of quality management, strengthening IPR protection of patents, trademarks, copyrights, geographical indications, new plant varieties, and layout design of integrated circuits, and promoting technology research and development, standard development, and industrial application in a coordinated manner. 建立政产学研用深度融合的质量创新体系，协同开展质量领域技术、管理、制度创新。加强质量领域基础性、原创性研究，集中实施一批产业链供应链质量攻关项目，突破一批重大标志性质量技术和装备。开展质量管理数字化赋能行动，推动质量策划、质量控制、质量保证、质量改进等全流程信息化、网络化、智能化转型。加强专利、商标、版权、地理标志、植物新品种、集成电路布图设计等知识产权保护，提升知识产权公共服务能力。建立质量专业化服务体系，协同推进技术研发、标准研制、产业应用，打通质量创新成果转化应用渠道.
It also talks about prompting quality consumption and quality green development, The latter entails entails improving resource efficiency in key industries and products; working on key and core technologies that facilitate low and zero-carbon development; promoting green design, green manufacturing and green construction; improving a unified system of green product standards, certification and labelling; optimising the technical standards of resource recycling; etc. 树立质量发展绿色导向。开展重点行业和重点产品资源效率对标提升行动，加快低碳零碳负碳关键核心技术攻关，推动高耗能行业低碳转型。全面推行绿色设计、绿色制造、绿色建造，健全统一的绿色产品标准、认证、标识体系，大力发展绿色供应链。优化资源循环利用技术标准，实现资源绿色、高效再利用。建立健全碳达峰、碳中和标准计量体系，推动建立国际互认的碳计量基标准、碳监测及效果评估机制。建立实施国土空间生态修复标准体系。建立绿色产品消费促进制度，推广绿色生活方式.
Section 4 deals with industrial quality. In this, the document talks about addressing weaknesses in industrial basic quality; integrating basic manufacturing techniques with quality management, digital intelligence and network technologies to make manufacturing processes more agile and lean; supporting the development of general basic software, industrial software, platform software and application software to achieve breakthroughs in key technologies related to industrial quality analysis and control software, etc.
It also talks about overall quality upgrading of agriculture, improving standards for quality upgrading of traditional industries, supporting strategic emerging industries and promoting high-end, intelligent, and green manufacturing. 加快传统制造业技术迭代和质量升级，强化战略性新兴产业技术、质量、管理协同创新，培育壮大质量竞争型产业，推动制造业高端化、智能化、绿色化发展，大力发展服务型制造. Accelerate the in-depth application of new technologies such as big data, the Internet and artificial intelligence, and promote the integrated development of modern service industries with advanced manufacturing and modern agriculture. 加快大数据、网络、人工智能等新技术的深度应用，促进现代服务业与先进制造业、现代农业融合发展. In addition, the document calls for encouraging the eastern regions to play the leading role in quality reform and innovation, while central and western regions are encouraged to develop characteristic industries in light of local conditions, upgrade the quality of pillar industries within the regions, and foster comparative advantages in quality development. 推动东部地区发挥质量变革创新的引领带动作用，增强质量竞争新优势，实现整体质量提升。引导中西部地区因地制宜发展特色产业，促进区域内支柱产业质量升级，培育形成质量发展比较优势.
Third, there’s a Xinhua article talking about the importance of the Two Establishments.
The article says that “looking ahead and implementing the strategic plan outlined at the 20th Party Congress for the development of the cause of the Party and the country in the coming times, the Two Establishments will always be the greatest certainty, the greatest confidence and the greatest guarantee for overcoming all difficulties and obstacles and coping with all uncertainties on a new journey full of glory and dreams.” 展望前路，贯彻落实党的二十大对未来一个时期党和国家事业发展作出的战略部署，“两个确立”必将在充满光荣和梦想的新征程上，始终是战胜一切艰难险阻、应对一切不确定性的最大确定性、最大底气、最大保证.
The article says that since the 18th Party Congress, the country faced complex, severe and arduous tasks. The “Party Central Committee with comrade Xi Jinping at its core has united and led the entire Party, army and people of all ethnic groups in rolling up their sleeves and working hard, marching forward come rain or shine, and waging a great struggle with many new historical characteristics without hesitation.” The achievements listed are:
Eliminating absolute poverty
Dealing with the pandemic — a “globally-renowned achievement” apparently
And “in the face of severe international and domestic risks and challenges, General Secretary Xi Jinping coordinated development and security, led China’s economic and social development to continuously break new ground, firmly safeguarded the core interests of the country, and maintained the overall stability of national security.”
党的十八大以来，中国特色社会主义进入新时代，党和国家面临的形势之复杂、斗争之严峻、改革发展稳定任务之艰巨世所罕见、史所罕见。以习近平同志为核心的党中央团结带领全党全军全国各族人民，撸起袖子加油干、风雨无阻向前行，义无反顾进行具有许多新的历史特点的伟大斗争。在决战决胜脱贫攻坚的“大战”中，习近平总书记7次主持召开中央扶贫工作座谈会，50多次调研扶贫工作，走遍全国14个集中连片特困地区，亲自指挥这场气壮山河的人民战争夺取全面胜利，完成全面建成小康社会的历史任务；在抗击新冠疫情的“大考”中，习近平总书记运筹帷幄、坚决果敢，带领人民同心协力、众志成城，高效统筹疫情防控和经济社会发展，取得世所瞩目的成绩；面对严峻的国际国内风险挑战，习近平总书记统筹发展和安全，引领我国经济社会发展不断开辟新境界，坚定维护国家核心利益，保持国家安全大局稳定；
It adds:
General Secretary Xi Jinping has led the whole Party, the armed forces and the people of all ethnic groups in overcoming obstacles and making remarkable achievements with the foresight, wisdom and determination of a great Marxist statesman, thinker, and strategist. Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era answers the questions of China, the world, the people, and the times with a series of original new ideas and strategies for governance, and opened up a new realm for the sinicization of Marxism. It is precisely because General Secretary Xi Jinping is at the helm that the whole party has a ‘pillar’ and more than 1.4 billion people in China have a ‘backbone’. It is precisely because of the scientific guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era that the whole Party, the armed forces and the people of all ethnic groups have a ‘fixed star’ when it comes to thought/ideology and a ‘compass’ to guide action. 习近平总书记以马克思主义政治家、思想家、战略家的雄韬伟略、远见卓识、战略定力，带领全党全军全国各族人民披荆斩棘，建立非凡之功；习近平新时代中国特色社会主义思想，以一系列原创性治国理政新理念新思想新战略，回答中国之问、世界之问、人民之问、时代之问，开辟了马克思主义中国化时代化新境界。正是因为有习近平总书记领航掌舵，全党才有了“顶梁柱”，14亿多中国人民才有了“主心骨”；正是有了习近平新时代中国特色社会主义思想的科学指引，全党全军全国各族人民才有了思想上的“定盘星”、行动上的“指南针”。
The article then says that the 20th Party Congress provided “a grand blueprint for comprehensively promoting the great rejuvenation of the Chinese nation with Chinese-style modernisation.” “The more magnificent the journey is, the more ambitious the goal is, and the more the need for the core steering the direction and the guidance of truth. Two Establishments are not only the winning password/code to create great achievements in the new era, but also the fundamental guarantee for the Chinese communists and the Chinese nation to move towards a brilliant future.” 党的二十大描绘了以中国式现代化全面推进中华民族伟大复兴的宏伟蓝图，开启了充满光荣和梦想的新的远征。征程越是壮阔，目标越是远大，越需要核心的掌舵定向、真理的指引领航。“两个确立”不仅是创造新时代伟大成就的制胜密码，更是中国共产党、中国人民、中华民族走向辉煌未来的根本保证.
“Looking forward to the future, there are opportunities—the Communist Party of China, which has gone through a century of struggle, has become stronger in the revolutionary forging; China’s development has a more solid material foundation, a more perfect system guarantee, and a more active spiritual force. The great national rejuvenation has entered an irreversible historical process. There are also challenges ahead—China's development has entered a period in which strategic opportunities and risks and challenges coexist, and uncertainties and unpredictability have increased. All kinds of ‘black swan’ and ‘grey rhino’ incidents may occur at any time, and the risks and challenges that need to be addressed and the contradictions that need to be averted and defused are more serious and complex than ever before. To grasp new opportunities and overcome new challenges, we must uphold the overall leadership of the Party, especially the centralised and unified leadership of the Party Central Committee, more consciously transform the political consensus of the Two Establishments into practical actions to achieve the two safeguards, and move forward in unison.” 展望未来有机遇——走过百年奋斗历程的中国共产党在革命性锻造中更加坚强有力，我国发展具备了更为坚实的物质基础、更为完善的制度保证、更为主动的精神力量，实现中华民族伟大复兴进入了不可逆转的历史进程。望前路亦有挑战——我国发展进入战略机遇和风险挑战并存、不确定难预料因素增多的时期，各种“黑天鹅”“灰犀牛”事件随时可能发生，需要应对的风险挑战、防范化解的矛盾问题比以往更加严峻复杂. 把握新机遇、战胜新挑战，必须坚持党的全面领导特别是党中央集中统一领导，更加自觉地把“两个确立”的政治共识转化为“两个维护”的实际行动，步调一致向前进.
If you are interested, on the theory page today, there’s another article by Li Junru from the Central Party School, highlighting the importance of the Two Establishments.
Li writes that “The establishment of General Secretary Xi Jinping as the core of the Party Central Committee and the core of the entire Party is the common, solemn, and inevitable choice made by history and the people. It is a blessing for the Party and the country, the people, and the Chinese nation.” 党的十九大把习近平总书记党中央的核心、全党的核心地位写入党章。确立习近平总书记党中央的核心、全党的核心地位，是历史和人民的共同选择、郑重选择、必然选择，是党和国家之幸、人民之幸、中华民族之幸.
Li adds: “Practice has proved and will continue to prove that with the scientific guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the cause of the Party and the country in the new era can continue to develop, and the historical process of the great rejuvenation of the Chinese nation can be fully advanced.” 实践已经证明并将继续证明，有习近平新时代中国特色社会主义思想的科学指引，新时代党和国家事业就能不断发展，中华民族伟大复兴历史进程就能全面推进.
Later he talks about the arduous challenges that still lie ahead given the current global and domestic situations. In this context, Li says: “Just as sailing the sea requires a helmsman who is courageous and good at breaking through the wind and waves and an all-weather compass to guide the direction, in the face of the inevitable high winds, high waves and even turbulent storms on the new journey, we must deeply understand the decisive significance of the Two Establishments and resolutely achieve the Two Safeguards’.” 如同大海航行要有敢于和善于迎风破浪前进的舵手，要有全天候的罗盘指南一样，面对新征程上难以避免的风高浪急甚至惊涛骇浪，我们更要深刻领悟“两个确立”的决定性意义，坚决做到“两个维护”.
Page 3: There’s a report informing that Cambodian Prime Minister Hun Sen will be visiting China from February 9 to 11.
But the key article on the page is by Cui Hongjian, Director of the Institute of European Studies from the China Institute of International Studies, taking aim at the US Inflation Reduction Act. Cui argues that the US is basically “keen on unilateralism and protectionism” and is therefore, becoming “a trouble-maker even for its allies.”
Cui writes that “the EU believes that the US has implemented a protectionist policy through the "Inflation Reduction Act", which has seriously damaged the development of European industries. The European Commission recently released the ‘Green Deal Industrial Plan’ to counter the adverse effects of the US ‘Inflation Reduction Act’ on Europe.” 欧盟认为美国借《通胀削减法案》推行保护主义政策，严重损害欧洲产业发展。欧盟委员会日前发布“绿色协议产业计划”，以对抗美国《通胀削减法案》给欧洲带来的不利影响.
He adds that “the EU believes that the Inflation Reduction Act excludes the production of European enterprises that are outside North America from the scope of subsidies, which obviously violates the non-discrimination principle of the World Trade Organization. Therefore, it identifies a number of tax credit clauses in the Act as ‘problematic clauses’. In the EU's view, the bill pursues an ‘America First’ approach and essentially follows the policy logic of unilateralism.” 欧盟认为该法案将欧洲企业在北美以外的生产排除在补贴范围之外，明显违背了世界贸易组织的非歧视性原则，因此将该法案中的多项税收抵免条款列为“问题条款”。在欧盟看来，该法案奉行“美国优先”，实质上反映了单边主义政策逻辑.
He argues that the EU is in a “fragile period of energy transition” particularly in the wake of the Ukraine “crisis.” And that the Europeans believe that the Inflation Reduction Act has “made the situation even worse.” Cui says that the Inflation Reduction Act entails “discriminatory measures…at the cost of undermining the open economy and fair competition environment, harming the industrial interests of other economies, and intensifying vicious competition such as subsidy wars and trade wars.” The EU, he adds, is worried that “relevant industries will be hollowed out by the United States and strongly opposes the US expanding its own interests at the expense of other countries' interests, especially at the expense of its allies.” 欧盟对美国《通胀削减法案》的反应如此强烈，是因为该法案会对处于能源转型脆弱期的欧洲产生巨大冲击。欧盟2019年提出“绿色新政”，能源转型成为欧盟资金、技术和政策投入的优先领域，也是欧盟参与未来产业竞争、提振就业、促进经济增长的希望所在。乌克兰危机发生后，欧盟实现能源转型的任务更加迫切，但面临的不利因素明显增多，美国推出《通胀削减法案》对欧盟可谓雪上加霜。尽管该法案重点内容以“推进绿色转型”为名，但其采取的歧视性措施是以破坏开放经济和公平竞争环境、损害其他经济体的产业利益、激化补贴战和贸易战等恶性竞争为代价。欧盟面临着与美国实力不对称、内部利益难协调等难题，难以在财政投入、技术转化以及政策协同等方面与美国进行长期竞争，因此担心相关产业被美国掏空，强烈反对美方以牺牲他方利益，尤其是损害盟友利益为代价来扩大自身利益.
He then writes that if the US is allowed to implement the Inflation Reduction Act, the EU will lose its advantages in rule-making, policy system and technological development in the field of green industry. In the long term, the EU's influence in global climate governance is also likely to be weakened. On a practical level, the EU is most concerned about the impact of the law on the transformation of European car manufacturing. Automobile manufacturing is an important industry in Europe, and Germany is one of the world's major automobile producers. German carmakers have been most directly hit by the subsidy effects of the US Inflation Reduction Act. Under the impact of the law, German enterprises to expand domestic investment confidence significantly decreased. Germany's core industrial interests are under serious threat from the fierce competition from US companies and the oppression of US unilateralist and protectionist policies.” 如果任由美国实施《通胀削减法案》，欧盟将丧失自身在绿色产业领域的规则制定、政策体系、技术发展等优势。从长期看，欧盟在全球气候治理中的影响力也有可能被削弱。在现实利益层面，欧盟最为担心的是该法案对欧洲汽车制造业转型的冲击。汽车制造业是欧洲的重要产业，德国更是世界主要汽车生产国之一。德国汽车制造业受美国《通胀削减法案》补贴效应的冲击最为直接。在该法案冲击下，德国企业扩大本土投资的信心明显下降。既要面临来自美国企业的激烈竞争，又要遭受美国单边主义和保护主义政策的打压，德国的核心产业利益受到严重威胁.
To substantiate this, he cites criticism from the German Chancellor and European Commission Executive Vice-President Valdis Dombrovskis.
He ends by saying “under pressure from the EU, the US and the EU set up a special working group and have conducted several rounds of negotiations since October 2022. The US has promised to include European commercial new energy vehicles within its subsidy scope, trying to appease the latter, but this is far from meeting the EU's fundamental demands. On the whole, this round of US-EU economic and trade disputes marked by industrial subsidies and rules-based competition may be difficult to resolve in the short term. A US that is keen on unilateralism and protectionism is a trouble-maker even for its allies.” 迫于欧盟压力，美国与欧盟成立专门工作组，自2022年10月以来进行了多轮谈判。美国承诺将欧洲的商用新能源汽车纳入其补贴范围，试图对后者稍加安抚，但这与欧盟的根本诉求相去甚远。综合看来，这一轮以产业补贴、规则竞争为标志的美欧经贸争端短期内恐难以化解。一个热衷于搞单边主义、保护主义的美国，即使对盟友来说，也是问题制造者.
Page 4: There’s a report on Sun Chunlan’s comments during an inspection tour of a number of secondary school and university campuses in Beijing on the reopening of schools following the break. Xinhua reports Sun as saying that “before the new school term, the COVID-19 statuses of teachers and students should be monitored closely, and health monitoring and management should be enhanced.”
Also, on the page is a report about a plenary session of the Commission for Political and Legal Affairs. During the session, Chen Wenqing, who heads the commission, called for implementing “Xi Jinping Thought on the Rule of Law and a holistic approach to national security, and to maintain political integrity earnestly and take solid steps to deliver tangible outcomes.”
The report says that “the meeting pointed out that political and legal organs are political organs under the leadership of the Party. They should maintain a clear-cut stand on politics, strictly observe political discipline and rules, firmly support the Two Establishments and achieve the two safeguards, resolutely implement the Party's absolute leadership over political and legal work, resolutely be absolutely loyal to the Party, share one heart and one mind with the Party, resolutely maintain a high degree of unity and absolute consistency with the Party Central Committee with comrade Xi Jinping at the core. It is necessary to promote the comprehensive and strict development of the Party in the fields of politics and law, and strive to forge an iron army of politics and law. 会议指出，政法机关是党领导下的政治机关，要旗帜鲜明讲政治，严明政治纪律和政治规矩，坚定拥护“两个确立”、坚决做到“两个维护”，坚决落实党对政法工作的绝对领导，坚决做到对党绝对忠诚、与党同心同德，坚决同以习近平同志为核心的党中央保持高度一致、绝对一致。要在政法领域推动全面从严治党向纵深发展，着力锻造政法铁军.
“It is necessary to enhance political acumen and political discernment, and improve the ability to maintain social and political stability, especially political security, with a sense of responsibility that is never relaxed. It is necessary to strengthen social governance and use the rule of law thinking and the rule of law for the investigation and resolution of contradictions and disputes. It is necessary to vigorously carry out investigation and research, strengthen political study and professional training of leading political and legal cadres, and enhance their ability to perform their duties.” 会议强调，要增强政治敏锐性和政治鉴别力，以时时放心不下的责任感，提高维护社会政治大局稳定特别是政治安全的能力。要加强社会治理，运用法治思维和法治方式推动矛盾纠纷排查化解。要大兴调查研究之风，加强政法领导干部政治学习和专业培训，提升履职能力。
Page 17: On the international page today, there’s a report on the challenges of “violent extremism” in the US. The report quotes assessments from the Office of the Director of National Intelligence, Department of Homeland Security and the FBI. Towards the end, the piece informs:
“Some scholars in the United States believe that domestic violent extremism in the country is rooted in the medium- and long-term structural changes within the American economy and society, especially the economic structure, social polarisation between rich and poor, and deepening of ethnic conflicts. These extremist ideas have deep political soil.” 美国一些学者认为，美国国内暴力极端主义植根于美国经济和社会的中长期结构性变迁，特别是经济结构虚化、社会贫富分化和族群矛盾深化，这些极端主义思想有着深厚的政治土壤.