CRG Weekly: Xi-Putin call and changing capital markets
News from the China Research Group
Confucius Institutes: After a campaign led by CRG co-chair Alicia Kearns, the UK’s universities minister Michelle Donelan confirmed that the Higher Education (Freedom of Speech) Bill will cover Confucius Institutes. Read our briefing here.
The stories driving the week
Xi reaffirms support for Moscow in call with Putin
In his second phone call with Russian President Vladimir Putin since Russia invaded Ukraine nearly four months ago, Xi Jinping re-emphasised support for Moscow’s security concerns.
Xi offered the most unambiguous declaration of support to his Russian counterpart since the invasion, saying “China is willing to work with Russia to continue supporting each other on their respective core interests concerning sovereignty and security.”
Also this week, Taiwan and the US both refuted a foreign ministry spokesman’s claims that China has “sovereignty, sovereign rights and jurisdiction over the Taiwan Strait”. The comments were made by Wang Wenbin at a regular press conference on Monday.
Are we seeing a reshaping of China’s capital markets?
An essential long read published in the FT this week tracks the Chinese states’s rising influence on capital in China. It includes an eye-catching statistic from investment data provider Preqin that the share of China-focused private equity and venture capital fundraising going to state-led funds has risen from about 2-3 per cent prior to Xi coming to power to more than a third in recent years.
The author, Hudson Lockett, translates this a bias in into China’s recent IPOs towards emerging technologies, such as electric vehicles, AI and biotechnology.
As scooped by the WSJ, US lawmakers are edging towards agreement on an unprecedented ‘reverse CFIUS’ - new regulation that would require disclosure of US outbound investments into China in certain strategic technology sectors.
Erosion of freedom in Hong Kong continues
Three stories from this week demonstrate the erosion of freedoms in Hong Kong. New textbooks for Hong Kong schools will state the territory was never a British colony, and that the British "only exercised colonial rule" in Hong Kong. This distinction drawn highlights China's claims of unbroken sovereignty.
Hong Kong’s education bureau announced that native-speaking English teachers (NETs) and advisers working in government-run schools must sign a declaration of allegiance to the city and its Basic Law by 21 June in order to continue working, as reported by The Guardian.
And select media outlets were reportedly not invited to a 1 July event which will see the formal swearing in of the former security chief John Lee, and will also mark the 25th anniversary of the British handback of Hong Kong to China.
Swathe of tech policy announcements in the UK
DCMS minister Chris Philip told The Times that the UK is still hoping to secure a London listing of Cambridge-based semiconductor powerhouse Arm Holdings. Arm had previously suggested that it was looking to float the business on Wall Street.
Chris Philip was speaking at the launch of the UK government’s new digital strategy to attract and build fast-growth businesses in the UK. Eye-catching announcements include a Future of Compute review and £23 million of funding for AI scholarships.
The UK also launched its new Defence AI strategy this week. It notes the risk of the use of AI by adversaries and highlights the role of a new Defence AI Centre to coordinate the use of AI by the MOD.
Weekend reads
Follow the FT’s excellent investigation into TikTok’s struggles in the UK to emulate its Douyin e-commerce model via live broadcast.
Michael Schuman’s long read in The Atlantic on his return to Beijing, 662 days after leaving.
Cindy Yu, Vincent Brusee and Jeremy Daum debunk myths around China’s social credit system on The Spectator’s Chinese Whispers podcast.