Hengqin Cooperation Zone - Universities' Inspection Report: Expect Tougher Rectification - Organisational Line on Reds vs Experts - BSE Details - Xi Thought: Socialist Art & Internet as 'Battlefield'

Here are the stories and pieces from the September 6, 2021, edition of the People’s Daily that I found noteworthy.

Page 1: A bunch of stories on the front page today to look at. First, there’s the full plan for building a Guangdong-Macao in-depth cooperation zone in Hengqin

The plan terms the development of Hengqin as part of developing the Greater Bay area. Xinhua English offers a decent summary: 

“The plan defines the strategic position of the zone as a new platform to boost Macao's appropriate economic diversification, a new space that provides convenience to Macao residents’ life and employment, a new model to enrich the practice of ‘one country, two systems,’ as well as a new high ground for building the Guangdong-Hong Kong-Macao Greater Bay Area.”

The Guiding Ideology for all of this is, of course, Xi Jinping Thought. The plan has three time-bound but rather vague goals -- by 2024, the initial system of coordination and integration between Guangdong and Macao would be developed; by 2029 this would have evolved significantly and “remarkable results” would have been achieved in “promoting the moderately diversified economic development of Macao”; and by 2035, “the strong vitality and superiority of ‘one country, two systems’ will be fully manifested, the economic strength and technological competitiveness of the zone will be greatly enhanced, the public service and social security systems will operate efficiently, the institutional mechanism for the integrated development will be more perfect, and the goal of promoting the moderate and diversified development of Macao’s economy will be basically achieved.’

The plan talks about strengthening science and technology research and development and high-end manufacturing in Macao. The industries that are mentioned in this context are: integrated circuits, electronic components, new materials, new energy, big data, artificial intelligence, Internet of things, biomedical sciences. In addition, the document calls to “accelerate the construction of a microelectronics industry chain featuring chip design, testing and inspection,” “building a collaborative innovation ecosystem for artificial intelligence,” “creating Internet Protocol Version 6 (IPv6) application demonstration projects” 5G application demonstration projects, and next-generation Internet industry clusters.

The plan talks about developing the TCM industry in the region, along with leisure and tourism industries. The paragraph regarding the latter talks about making this a place for international events, conferences, medical care, etc. It also talks about easier entry-exit processes, specifically in connection with events being organised in the region. We also are to get a Sino-Portuguese International Trade Center and an international hub port with the aim being to ensure digital transformation of traditional trade.

The section on financial development is broad, with no specific goals. But the taxation paragraph tells us that enterprise income tax will be levied at a reduced rate of 15% on eligible industrial enterprises in the zone. Also income obtained from new overseas direct investment in tourism, modern service industry and high-tech industry enterprises established in the zone shall be exempt from enterprise income tax. The tax on income of high-end, scarce talents, Chinese or foreign, will be capped at 15%. It talks about attracting international universities and building a base for overseas high-end talents through preferential policies.

The next few paragraphs talk about integration with Macao in terms of attracting people from there to set up businesses, facilitating their access to the area and the establishment of medical institutions. For instance, the plan promises to “support the extension of the Macao light rail to the zone, connecting it with Zhuhai’s urban rail network, and integrating it into the mainland’ rail transit network.”

The following paragraphs talk about freer and orderly flow of goods, people, capital, and data. We are told that a new management committee will be set up, which will be in charge of the zone from a policy perspective. This committee will come under the Guangdong-Hong Kong-Macao Greater Bay Area Development Leading Group. The Governor of Guangdong and the CE of Macao will be joint directors on the committee. The key institution in this system carrying out implementation will be an executive committee that comes under the management committee. 

Guangdong and Macao will devise a revenue sharing mechanism in the cooperation zone. Also if I understand correctly, the management committee will be in control of all investment income till 2024. The idea is that this is to be used for the development of the zone. Finally, the central government will provide subsidies for the zone, but these are restricted for “the attraction of Macao enterprises to enter the zone, the expansion of employment, the increase of real economic output value and the support of key industries determined in this plan.” Also, the subsidies shall not exceed the central government’s share of tax revenue. 中央财政对合作区给予补助,补助与合作区吸引澳门企业入驻和扩大就业、增加实体经济产值、支持本方案确定的重点产业等挂钩,补助数额不超过中央财政在合作区的分享税收. 

The final section talks about safeguards; these include party building, strengthening rule of law and risk management, entailing cracking down on illegal and criminal activities, including financial crimes.

Next, let’s look at the report with regard to the 7th round of inspections of the 19th Central Committee. If you recall, this looked at Party units in the Ministry of Education and 31 universities across the country.  And let me tell you, this wasn’t a glowing report card; in fact, if this is anything to go by, the times are only going to get tougher for universities in China.

Politburo member and Deputy Secretary of the Central Commission for Discipline Inspection, Yang Xiaodu, spoke at the meeting. The report tells us that from September 2 to 4, the Ministry of Education and the universities were provided individual feedback. The key person in charge and leading groups were given feedback about “the important problems found in the inspection.” 

The next paragraph offers some praise.

The Party Group of the Ministry of Education and the Party Committees of the centrally administered universities have “improved their sense of responsibility for governing the Party, and have achieved new results in running schools and making positive contributions to serving the national strategy and economic and social development.” 教育部党组和中等管理大学党委明显提高了管党治党的责任感,办学取得新成效,为服务国家战略和经济社会发展作出了积极贡献.

But, there are serious, outstanding problems too. These relate to:

  • Shortcomings in strengthening political development; there is a gap between the implementation of the Party’s educational policy and the decision-making and deployment of the CPC Central Committee on educational work.

  • The new development concept has not been accurately and comprehensively implemented, and there are shortcomings in terms of grasping the laws (don’t think these laws relate to regulations but rather much more abstract principles from a Marxist viewpoint) related to education work.

  • The report criticises moral cultivation, the need to strengthen teachers’ moral development and says that “the “ideological and political education is relatively weak.”

  • Party committees come in for criticism for not taking enough initiative with weaknesses in leadership being highlighted.

  • While some do a good job of ideological work in the new era, there remain varying degrees of “risks and hidden dangers.”有的做好新时代思想工作,不同程度存在隐患.

  • The report talks about the need for stricter management and top-down control; it points to corruption in scientific research and infrastructure construction, integrity issues related to university-run enterprises, partner institutions and affiliated hospitals, and violations of the eight central regulations.

So what should folks do now?

Well, they should thoroughly study and implement Xi Jinping Thought, specifically his requirements with regard to the education sector. They need to “further strengthen political construction, improve the political position, accurately grasp the requirements of “国之大者” for education, strengthen and improve the Party’s overall leadership over colleges and universities, implement the Party's educational policy, adhere to the socialist direction of running schools, and unswervingly follow the development path of higher education with Chinese characteristics.” ...进一步加强政治建设,提高政治地位,准确把握“大国”对教育的要求,加强和改进党对高校的全面领导,贯彻党的教育方针,坚持社会主义办学方向,坚定不移走中国特色高等教育发展道路.

The emphasis is on moral development; the main task is to “strengthen ideological and political work” improve teachers’ moral development and conduct of the institutions, with the aim being to train and develop “socialist builders and successors.” 要围绕立德树人、主责主业,加强思想政治工作和师德师风学风建设,着力培养德智体美劳全面发展的社会主义建设者和接班人.

“It is necessary to implement the Regulations on the Work of Grass-roots Organizations in Colleges and Universities, conscientiously implement the principal responsibility system under the leadership of the Party Committees, and strengthen the construction of leading bodies, cadres and talents and grassroots party organizations in colleges and universities.” 要贯彻落实《中国共产党高等学校基层组织工作条例》,认真落实党委领导下的校长负责制,加强高校领导班子、干部人才和基层党组织建设

The last couple of paragraphs warn of tougher action ahead. It says that the inspected party organizations should take the inspection and rectification as “a powerful starting point for managing the party and running the school.” The emphasis for responsibility here is on the Party Secretary. It also warns that discipline inspection and supervision organs should strengthen daily supervision of rectification efforts, focus on the leading bodies and key few, focus on the key issues that have been highlighted in the feedback...Those who are ineffective in rectification, perfunctory, or resort to deceit shall be held accountable. 纪检监察机关要加强整改日常监督,聚焦领导班子和“关键少数”,重点对重点问题进行巡视反馈,对问题线索进行分类处置,积极督促、依靠靠前、精准督促。对整改不力、敷衍塞责、弄虚作假的,依法追究责任.

Next, we have a commentary drawing from Xi’s speech at the Party School. I thought this below is the most important point made in the commentary. The rest is a repetition of the points Xi made about building a loyal, honest, and responsible team of high-quality cadres. The piece also reiterates Xi’s comments regarding corruption, worldview, loyalty, taking responsibility, self-discipline and self-cultivation, etc.

Here’s my takeaway from the piece:

“the Party’s organizational line for the new era calls for upholding the principle of adhering to both ability and political integrity, putting virtue first and appointing people on their merits. In selecting cadres and employing talents, we should place emphasis on morality, but at the same time, we should not neglect competence.” 新时代党的组织路线提出坚持德才兼备、以德为先、任人唯贤的方针,就是强调选干部、用人才既要重品德,也不能忽视才干.

Next, there’s praise for the Chinese paralympics delegation on the page and a report about what they’ve achieved; also, there’s a commentary about the “spirit of fighting against floods.” This refers to the 1998 flooding of the Yangtze, Nen, and Songhua rivers. 

Page 2: A report about Hu Chunhua’s inspection in Qinghai. Xinhua English tells us that “consolidating and expanding the achievements of poverty alleviation is the primary task in the transition period for rural areas that have shaken off poverty, Hu said, calling for efforts to prevent large-scale return to poverty. Efforts should also be made to stabilize employment, develop region-specific distinctive industries and improve rural living environment, Hu said.” 

Next, someone from the China Securities Regulatory Commission is interviewed about the proposed new Beijing Stock Exchange. Already, CGTN tells us that the Beijing Stock Exchange has completed registration with a capital of one billion yuan ($155 million), according to the National Enterprise Credit Information Publicity System. 

Anyway, the PD interview is very similar to this report from Caixin. In fact, since I am not familiar with Chinese equity market functioning at all, I had a tough time trying to understand this interview. The Caixin report was really helpful. But here’s what I understood. The official says that the National Equities Exchange and Quotations (NEEQ) has three levels, a select tier, innovation tier and base tier; the BSE will entail the listing of companies in the select tier. 

So the aim of the exchange is to have a “professional platform for the innovation and development of small and medium-sized enterprises” and “form a market service system to support the sustainable growth of SMEs.” Access to capital is critical to all of this, of course. The hope is also that through this exchange SMEs will enhance corporate governance awareness and grow more sustainable, while there is greater public and investor awareness about them. 

I think it’s useful to also read the Caixin report’s summary in this context.

“Why is China launching the exchange now?

The government has for years been pushing the financial sector to provide capital for SMEs and has launched several bourses to expand financing channels for them, most recently the STAR Market in Shanghai in 2019 that was also an initiative of President Xi. But policymakers have become increasingly concerned about SMEs’ continued lack of access to funding, especially innovative companies in emerging and high-tech industries. The BSE is part of a broader strategy to increase support for smaller businesses and help them tap investors directly for money rather than relying on banks. The exchange will help enhance the capital market’s role in serving and nurturing SMEs, and promote the formation of innovative capital, said Xiao Gang, a former chairman of the CSRC. The BSE also forms part of Xi’s strategy to build a society of “common prosperity” and improve income distribution to tackle social inequality. As part of that strategy, China has stepped up efforts to tackle monopolies, tightened restrictions on the after-school tutoring sector, and cracked down on abuses and misconduct by internet giants. The new exchange will also play a role in expanding funding channels for Chinese companies that face growing hurdles to listing in the U.S. amid rising tensions between the world’s two largest economies. Regulators from both countries have increased scrutiny of Chinese companies seeking to go public in the U.S. after ride-hailing giant Didi Global Inc.’s IPO at the end of June prompted Chinese authorities to launch an investigation into national security risks posed by domestic companies listing overseas.”

Back to PD, the official says that the BSE is focussed on innovative SMEs driven by the with the target of “earlier, smaller, newer” 更早, 更小, 更新. -- not entirely sure what this implies.

Next, Wang Yong addressed (English report) the China Charity Awards ceremony in Beijing on Sunday. Wang said the authorities need to improve policies relating to charities, promote the healthy development of the charity sector and guide the sector in aiding the disadvantaged and contributing to common prosperity. More efforts are also needed to implement the Charity Law, improve the incentive mechanism and foster all charitable groups in line with the central government's requirements, Wang said. Incentives will be rolled out to guide the groups on aiding disadvantaged groups such as the elderly, the disabled, the young and the poor. Programs that assist schooling and medical services will also be rolled out. Charities are also being encouraged to help consolidate the fruits of the government's poverty-relief campaigns and strengthen social safety nets. Authorities will need to bolster oversight, while the industry should have better self-discipline and transparency, he said.”

Finally, a short report (English report) telling us that China’s service trade rose by 7.3 percent year on year to nearly 2.81 trillion yuan (about 435.02 billion U.S. dollars) in the first seven months of the year, as per the Ministry of Commerce. But with that said, do check out this report too: “China’s services activity ‘plunges’ after coronavirus flare-ups

“Activity in China’s services sector “plunged” in August due to a series of coronavirus outbreaks, a private survey showed on Friday, matching the findings in the official data released earlier this week. The Caixin/Markit services purchasing managers’ index (PMI) – a gauge of sentiment among smaller, private firms – fell to 46.7 in August from 54.9 in July. It was the first time that services activity shrank since April 2020. The result was well below expectations by analysts polled by Bloomberg, who had forecast that the index would fall to just 52. A reading above 50 indicates growth in sector activity, while a reading below the mark represents contraction. The lower the reading is below 50, the faster the pace of contraction.”

Page 5: We have the 36th piece in the Xi Thought Q&A series today. The first question is the impact of the market economy on literature and art. It’s uncanny how this bit comes today when we are in the midst of an upheaval in the culture and entertainment industries.

This piece goes back to October 15, 2014, with Xi attending a Forum on Literature and Art in Beijing. The piece tells us that as the crowd grumbled about works of art and literature earning big money but not serving social benefits, Xi spoke to say: “Literature and art cannot lose direction as they are absorbed into the market economy; they cannot deviate on the fundamental question for whom they are; otherwise, literature and art will have no vitality.” 有与会者直言:“有些作品,观众一边看一边骂,创作者一边挨骂一边还挣着大钱。这样的作品是有经济效益了,但是社会效益呢?”针对文艺领域存在的问题,习近平总书记明确指出:“文艺不能在市场经济大潮中迷失方向,不能在为什么人的问题上发生偏差,否则文艺就没有生命力。”字字铿锵,掷地有声,振聋发聩. ---- Doesn’t this sort of come across like a mic drop moment in the way it’s presented?

The next paragraph emphasises the importance of literature and art and generally says that since reform and opening up the “majority of literary and art workers have kept up with the times and devoted themselves to the times.” And many of these pioneers of socialist literature and art were celebrated in 2018, as the Party marked the 40 years of Reform and Opening up. But, and there’s always a but, there are problems that persist.

These include quantity but lack of quality, and “high plateaus” but no “high peaks”, plagiarism, imitation and stereotypes, mechanistic production and fast-food-style consumption. Some works are purely driven by financial motives; some are like 摇头丸 Ecstasy aimed at sensory stimulation; and some are simply 文化“垃圾” cultural trash. 有的把作品当作追逐利益的“摇钱树”,当作感官刺激的“摇头丸”;有的胡编乱写、粗制滥造、牵强附会,制造了一些文化“垃圾”...These developments inform about the need to be careful that literature and art do not deviate owing to the market, “must not be a slave to the market” and must maintain “correct direction.” 

The next paragraph tells us that “socialist literature and art are essentially people's literature and art...The people are the source of literary and artistic creations, and once literature and art are distanced from the people, they will be akin to rootless duckweed, groans without disease (无病的呻吟), and bodies without souls.” 人民是文艺创作的源头活水, 一旦离开人民,文艺就会变成无根的浮萍、无病的呻吟、无魂的躯壳.

Useful little thing I learned today: So 无病的呻吟 - wú bìng de shēnyín - is an idiom that implies pretentiousness of literary works; or works that lack meaning or feeling behind them; just like someone groaning or moaning without actually being unwell. 

Anyway, the piece tells artists to “adhere to the people-centered creative orientation.” They should “follow the people's footsteps...let their hearts beat with the people's hearts forever, pour the people’s joys and sorrows into their works, and aspire to create excellent masterpieces…”文艺工作者要坚持以人民为中心的创作导向,始终追随人民脚步,走出方寸天地,阅尽大千世界,让自己的心永远随着人民的心而跳动,把人民的喜怒哀乐倾注在自己的作品中,立志创作出在人民中传之久远的精品力作.

Socialist literature, meanwhile, must emphasise social benefit, which must be prioritised over economic benefits, although the latter cannot be ignored. “When two benefits and two values conflict, economic benefits should be subordinated to social benefits and market values should be subordinated to social values.” 然而,同社会效益相比,经济效益是第二位的,当两个效益、两种价值发生矛盾时,经济效益要服从社会效益,市场价值要服从社会价值. 

“Literary and artistic workers should adhere to the social benefits in the first place, establish a correct view of history, ethnicity, country and culture...they should conscientiously abide by state laws and regulations, improve moral standards, resolutely reject vulgarity and kitsch…” 文艺工作者要坚持把社会效益放在首位,树立正确的历史观、民族观、国家观、文化观,自觉讲品位、讲格调、讲责任,自觉遵守国家法律法规,加强道德品质修养,坚决抵制低俗庸俗媚俗,用健康向上的文艺作品和做人处事陶冶情操、启迪心智、引领风尚.

Towards the end, the response bemoans the dominance of market values; it tells us that art is hard work -- one needs perseverance and determination. It talks about artists being impetuous and chasing fame, which leads to “vulgar” creations; it also bemoans that market standards have replaced artistic standards with the logic of capital overriding the logic of creation. In the end it says that rather than focussing on these things, artists must focus on virtue and “integrate artistic ideals into the cause of the party and the people.”

The answer ends with:

“Literary and art workers should adhere to the Marxist outlook on literature and art, consciously practice advanced culture and guide social trends, create literature and art that is worthy of our great nation and great era, and strive to create a peak in literature and art in the era of the great rejuvenation of the Chinese nation.” 广大文艺工作者要坚持马克思主义文艺观,自觉做先进文化的践行者、社会风尚的引领者,进行无愧于我们这个伟大民族、伟大时代的文艺创造,努力筑就中华民族伟大复兴时代的文艺高峰.

The next question is about harnessing the power of the Internet and governance of cyberspace.

The response tells us that the internet and cyberspace are the frontlines of ideological warfare and a “battlefield without smoke of gunpowder,” and that winning in this context is directly related to the long-term governance of the Party and the long-term stability of the country. “History and reality have repeatedly proved that efforts to disrupt a society and overthrow a regime usually begin with engineering cracks in the field of ideology...When the ideological line of defense is breached, the other lines are hard to hold. Anti-China forces in the West have been trying to take advantage of the Internet as the biggest variable to ‘bring Down China’.” The examples given in this context are trade frictions with the US, Hong Kong, and COVID-19-related issues.   互联网是意识形态交锋的最前沿。历史和现实反复证明,搞乱一个社会、颠覆一个政权,往往先从意识形态领域打开缺口,先从搞乱人们思想入手。思想防线被攻破了,其他防线就很难守住。西方反华势力一直妄图利用互联网这个最大变量来“扳倒中国”,一些西方政客直言不讳地称“有了互联网,对付中国就有了办法”,“社会主义国家投入西方怀抱,将从互联网开始”。在香港修例风波、中美经贸摩擦、新冠肺炎疫情等问题上,西方国家利用网络混淆是非、颠倒黑白、上下其手,企图抹黑中国、扰乱人心。这些都说明,互联网是一个没有硝烟的战场,我们能否顶得住、打得赢,直接关系到我们党能否长期执政,关系到国家能否长治久安.

The next paragraph talks about the fact that the Internet is an “amplifier of public opinion.” This is evident, so I don’t want to go into details. But the objective in this paragraph is to make the point that given this challenge, focusing on positivity is important. Also this little principle is very useful to note:

网络空间同现实社会一样,既要提倡自由,也要保持秩序.自由是秩序的目的,秩序是自由的保障. “In cyberspace, just like in the real world, we should uphold both freedom and order. Freedom is the purpose of order, and order is the guarantee of freedom.” -- So when you see core socialist values or Chinese leaders talking about freedom being a common value, do keep this context in mind.

What must, therefore, be ensured is that “the Party supervises the Internet and new media.” Also, what must be done is to “strengthen positive online propaganda” and “strengthen the development of Internet content.” The piece calls for carrying out intensified “online public opinion struggles” and uniting the hundreds of millions of Internet users around Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. 要坚持党管网络、党管新媒体,落实“两个所有”要求,做强网上正面宣传,加强互联网内容建设,深入开展网上舆论斗争,用习近平新时代中国特色社会主义思想团结、凝聚亿万网民,构建网上网下同心圆.

The next bit talks about enhanced cyberspace governance according to law, with the aim to strengthen the construction of network ethics and network civilization. An interesting part of the piece is the emphasis on core technologies. 

It refers to core Internet technologies as the biggest “lifeline”, the control of which by others is the “biggest hidden danger.” No matter how big a company is, if it has core technology vulnerabilities in terms of heavy dependence on external actors, it is like building a home on someone else’s foundation. Such a structure will not be able to withstand the vicissitudes of wind and rain, regardless of how beautiful it may be, the piece tells us. --- No prizes for guessing what this is referring to.

Anyway, then the piece talks about the Huawei and ZTE examples before there’s a call to head into the ‘deep water’ zone, venture into the ‘no man's land’, tackle issues related to basic technologies, general technologies, asymmetric technologies, ‘trump card’ 杀手锏 technologies, frontier technologies, disruptive technologies, and strive to achieve leapfrog development in certain domains and make breakthroughs in the core technologies at the earliest. 过好互联网这一关,必须直奔“深水区”,勇闯“无人区”,扭住基础技术、通用技术、非对称技术、“杀手锏”技术、前沿技术、颠覆性技术,争取在某些领域、某些方面实现“弯道超车”,尽快在互联网核心技术上取得突破.

Elsa Kania is my go to scholar for military-technology issues; and in this piece she tells us that 杀手锏 shashoujian “translated ‘trump card’ or ‘assassin’s mace’, is generally used to refer to asymmetric capabilities that could target U.S. vulnerabilities. The term also alludes to a Chinese folktale in which such a weapon was used for unexpected incapacitation of a stronger enemy through a trick.”

Other Stories:

  • A report about the EU’s Josep Borrell’s remarks on Afghanistan. The point picked up here is Borrell saying that “It was not just a military defeat; it was also a defeat of the Western values.” It also quotes Borrell saying that “democracy cannot be exported.” But of course, there’s no context provided. For instance, here’s what Borrell said when asked about the lessons from Afghanistan:

“A lot of them. That is what we are going to discuss. But, certainly, this morning I already said at the end of the [meeting of the] Defence Ministers, that certainly we will have to have a more comprehensive approach. Not only military, but civilian, development, efficient governance, fight against corruption. All this has to be a package. And a lot of local empowerment. You do not export democracy, you do not export freedom. It has to be empowered by the people. But this is something that will have to be developed much deeper, because certainly the Western values did not have enough power in the Afghan society. This has to be taken very much into consideration. It was not just a military defeat; it was also a defeat of the Western values.”