FTSE Russell, a world-renowned index service company, recently announced that it will delete the shares of eight Chinese companies from relevant indexes. It was the “black hand” of the United States to suppress China that pushed the British company to make a decision. From Trump’s executive order prohibiting anyone in the United States from investing in “Chinese companies owned or controlled by the Chinese military” to the “blacklist” of the U.S. Department of Defense, the U.S. State Department even issued a so-called “fact list” on the 5th, naming two index companies, which amounted to intimidation.
Over the past weekend, the United States also terminated five U.S.-China cultural exchange programs and announced that it would ban the entry of CCP United Front officials. Germany’s Süddeutsche Zeitche Zeit said that the United States has introduced new measures to suppress China almost every day recently, and Trump seems to push the confrontation with China to a crazy climax in the last part of his term. The latest issue of Asia Weekly warned on the 6th that from the perspective of the model of raiding Iran, Trump’s possibility of taking risks to China in the next six weeks cannot be ruled out. From the Taiwan Strait to the South China Sea, it is a dangerous gunpowder bank. The magazine criticized Trump for wanting to open the “Pandora box” of U.S.-China relations, disrupt diplomatic muddy waters, and fish for internal affairs.
List of lies under the name of “facts”
On the 5th local time, the website of the U.S. State Department released a “fact list” entitled “U.S. investors are financing malicious Chinese companies through major indexes”. This list, under the name of “facts”, is full of lies. The U.S. State Department claims that “the threat of the Communist Party of China’s national security extends to financial markets and affects American investors”, because many stock and bond indices of index-forming companies such as Ming Ti and FTSE Russell include “Communist China” listed in the list of entities of the U.S. Department of Commerce and the United States Department of Defense. Military enterprises”.
India’s New Delhi TV station reported that the U.S. State Department was warning that its investors did not know it to invest in Chinese enterprises involved in civilian and military production. According to the list, as of June this year, at least 22 subsidiary securities of the 31 parent-company-level Chinese civil and military enterprises have been included in the main securities index. The shares of at least 13 parent companies or subsidiaries of Chinese companies included in the entity list are included in the Mingmei Index and the FTSE Russell Index.
Ming, named by the U.S. State Department, and FTSE Russell in the United Kingdom, are world-renowned index service companies. Song Guoyou, deputy director of the American Research Center of Fudan University, told the Global Times on the 6th that the inclusion of these indexes in Chinese company stocks is conducive to expanding the influence and liquidity of Chinese companies. The U.S. State Department intends to deter index companies and international investors by naming and intensify the crackdown on China in the financial field. Chinese enterprises should be restricted not only in the United States, but also in the international financial market.
The statement of the U.S. State Department comes after a spokesman for the London Stock Exchange Group of FTSE Russell announced on the 4th that the shares of eight Chinese companies, including Hikvision and China Railway Construction, will be deleted from relevant indexes, effective December 21. The company said that if the Office of Foreign Assets Control of the U.S. Treasury Department, which oversees and enforces the U.S. sanctions, publishes an official list of banned companies, it will also remove shares of other companies from its index.
The Trump administration issued an executive order on November 12, prohibiting anyone in the United States from investing in so-called “Chinese companies owned or controlled by the Chinese military” from January 11 next year. So far, the U.S. Department of Defense has included 35 Chinese enterprises in the list of “Chinese military enterprises”. The Financial Times reported that other index companies are still evaluating Trump’s executive order. Ming said that a decision will be made as soon as this week whether to delete the shares of Chinese companies. The Emerging Markets Index has attracted particular attention from investors. In addition, Nasdaq is also conducting such an assessment, and the results may be announced in the next few days.
Hong Kong’s South China Morning Post commented that the United States is promoting these restrictions as the Chinese government is taking action to further open up financial markets to foreign investment, and Chinese sovereign bonds are being included in the global bond index. America’s “blacklist” could start a tumultuous head for the new year. Song Guoyou told the Global Times that not including the index is not delisting or restricting transactions. It may have some impact on the company’s popularity and turnover, which may cause stock prices to fall in the short term. But it will not have much inevitable impact on China’s economy.
Provoking the relationship between the Communist Party and the Chinese people will be counterproductive.
“The Trump administration has been taking a hard line towards China, and it showed no sign of slowing down that practice during the final period of administration.” Fox News described the atmosphere of China in American politics on the 5th. On the evening of the 4th local time, U.S. Secretary of State Pompeo announced the termination of five U.S.-China cultural exchange programs, claiming that these projects, fully funded and operated by China, have become “Chinese soft power propaganda tools”.
The terminated projects include the Policymakers Education China Travel Project, the U.S.-China Friendship Project, the U.S.-China Leadership Exchange Project, the U.S.-China Trans-Pacific Exchange Project and the Hong Kong Education and Cultural Exchange Project.” DW” commented that these projects allow U.S. government employees to travel with foreign government funds under the U.S. Education and Cultural Exchange Act, aiming to promote academic and cultural exchanges with foreign countries. But Sino-US relations have declined sharply due to increasingly malicious concerns about China’s rise.
In a statement, the U.S. State Department accused the Chinese government of providing only opportunities to contact carefully prepared members of the Communist Party of China, not with the Chinese people. Regarding the terminated projects in Hong Kong, a spokesman for the Hong Kong Special Administrative Region Government said on the evening of the 5th that Hong Kong’s educational and cultural exchange program has been implemented for many years and has been providing a valuable opportunity for members of the United States Congress to learn first-hand about Hong Kong’s development and matters of mutual concern. This is another unilateral and unmotivated decision of the U.S. authorities, not only to combat the long-term cooperation between the two sides, but also to close the door to dialogue for the sake of political slander.
Pompeo also announced on the 4th that it would prohibit CCP United Front officials or people involved in the CCP United Front activities from entering the United States. The move was to protect the United States from “malicious influence,” the State Department said in a statement.” The United States is on the path of further deterioration of relations with China,” Russian television today quoted Bajuk, an expert from the Russian Academy of Sciences, saying that Pompeo and other senior U.S. officials exaggerate the confrontation between the United States and China as some kind of ideological incompatibility, which is extremely dangerous, because there can be no compromise in the ideological field.
Previously, the U.S. State Department had announced that the travel visas of members of the Communist Party of China and their families to the United States should be limited to a single entry per month from the maximum validity period (10 years).” VOA said that analysts said that a series of measures of the Trump administration were to distinguish the Communist Party from the Chinese people. However, Ge Laiyi, head of the China Power Project of the Center for Strategic and International Studies, a US think tank, believes that if the purpose of the visa restriction is to reduce Chinese support for the Communist Party of China, the effect may be counterproductive. “I think this will cause greater nationalism in China, and support for the party will increase rather than decrease,” she said.
“The question now is how bad [the US and China] will be in the six weeks before Biden takes over as president.” Bloomberg expressed concern. CNN said that Trump still has some ammunition to attack Chinese companies. The Foreign Company Accountability Act passed by the U.S. House of Representatives last week may kick several Chinese companies out of Wall Street. Shirley Yu, a visiting scholar at the London School of Economics, said that Trump will sign the bill before the end of his term, which will be extremely difficult to be overthrown by the next government. Michael Herson, head of China and Northeast Asia business at Eurasia Group, said: “The Trump administration’s eagerness to launch actions against China by January 20 will short-circuit the already chaotic policy process in the United States.”
Biden should give priority to establishing a new framework for U.S.-China relations
CNN6 quoted three people familiar with the matter as saying that Biden’s team is considering the candidate for U.S. ambassadors to various countries and is expected to first announce the arrangements for several important positions in January next year, including the candidate for the U.S. ambassador to China. Wendy Sherman, Kurt Campbell and Bill Burns, three people who held senior positions in the State Department during the Obama administration, may be on the list. In addition, there are some American business elites who are interested in joining the diplomatic circle, and Disney’s outgoing CEO Bob Eagle is interested in China.
The British Express said that Biden will try to push back some of Trump’s policies towards China, but in essence, their policies may not be much different. Thomas Gifford, an associate professor of political science at the London School of Economics, said that Trump basically turned the confrontation with Beijing into a one-on-one confrontation, while Biden wanted to take a “many more powerful” approach with allies in his policy towards China. Biden will pay less attention to “economic risk policy” than his predecessor, and should not use “spicy rhetoric” like Trump. But in general, it will take time for the United States and China to significantly improve the relationship between the two countries.
The Washington Post urged Biden to eliminate tariffs on China and break Trump’s aggressive and ineffective trade risk policy towards China. The newspaper said that there may be legitimate political reasons to retain the tariffs imposed by Trump, but there is no valid economic reason. The new framework for building U.S.-China relations should be a foreign policy priority for the Biden administration.
India’s Sunday Guardian commented that although it can be debated whether communism or capitalism is superior, there is no doubt that China is currently winning competition. Because when Washington is busy debating which color of running shoes to wear, Beijing has surpassed the United States on many topics. If the United States cannot restore order to its country, China will take the lead in many aspects.