Afghanistan is where the eyes of the world are. In my view, and according to the Chinese media and commentary, China is the inheritor of Afghanistan in terms of possible rebuilding of the country (finance, economy, industry, and trade) and also to ensure that a terrorist problem does not threaten across the border with China. The jury is out in terms of the trajectory here. China though has its embassy open, and this photo possibly says it all.

Afghanistan’s China Town reopens, not disrupted by the deadly blasts in Kabul airport

Vladimir Putin had a telephone conversation with President of the People’s Republic of China Xi Jinping.

In the context of the 20th anniversary of the Treaty of Good-Neighbourliness and Friendly Cooperation, the presidents noted with satisfaction that the Russian-Chinese strategic partnership has been developing progressively and dynamically. The main thing is that both sides are interested in further strengthening cooperation on the entire complex of issues on the bilateral and international agenda.

The leaders had an in-depth discussion on the Afghanistan problem. They expressed readiness to step up efforts to counter the threats of terrorism and drug trafficking emanating from Afghanistan and emphasised the importance of achieving peace as soon as possible and preventing the spread of instability to neighbouring regions. It order to do this, the presidents intend to use the potential of the Shanghai Cooperation Organisation as much as possible, among other things. The two leaders also agreed to step up bilateral contacts and close cooperation, above all between the foreign ministries.

On the occasion of the upcoming 76th anniversary of the end of World War II, the relevance of the work to preserve the truth about the events of that period and prevent attempts to falsify history was noted.

The conversation was held in a traditionally friendly and trust-based atmosphere.


From the Chinese media, 7 deadly sins that the US committed in Afghanistan

Sin 1: Warmonger

Sin 2: Machiavellian

Sin 3: Human Rights Abuses

Sin 4: State-Sponsored Terrorism

Sin 5: Heroin Trafficking

Sin 6: Blasphemy

Sin 7: Environment Destruction

http://www.news.cn/english/2021-08/24/c_1310146023.htm


In Afghanistan, China Is Ready to Step Into the Void, by Zhou Bo

This complete article is available on Godfree’s newsletter and this is but a short excerpt.  However, it illustrates the internal view of China on Afghanistan:

Zhou Bo is a senior fellow at the Center for International Security and Strategy at Tsinghua University and a member of the China Forum. He was a senior colonel in the People’s Liberation Army from 2003 to 2020 and is an expert on the Chinese army’s strategic thinking on international security. He directed the Centre for Security Cooperation in the Office for International Military Cooperation at the Ministry of National Defense.

The speed and scope of the Taliban’s takeover in Afghanistan have prompted introspection in the West over what went wrong, and how, after billions of dollars spent on a 20-year war effort, it could all end so ignominiously. China, though, is looking forward. It is ready to step into the void left by the hasty U.S. retreat to seize a golden opportunity.

While Beijing has yet to formally recognize the Taliban as Afghanistan’s new government, China issued a statement on Monday saying that it “respects the right of the Afghan people to independently determine their own destiny” and will develop “friendly and cooperative relations with Afghanistan.”

The message here is clear: Beijing has few qualms about fostering a closer relationship with the Taliban and is ready to assert itself as the most influential outside player in an Afghanistan now all but abandoned by the United States.

Unlike the United States, China brings no baggage to the table in Afghanistan. China has kept a low profile in the country since the U.S. invasion, not wishing to play second fiddle to the United States in any power politics. Beijing watched as Washington’s foray in Afghanistan became a messy and costly morass. In the meantime, China providedAfghanistan millions of dollars in aid for medical assistance, hospitals, a solar power station and more. All the while, Beijing was fostering stronger trade relations, eventually becoming one of Afghanistan’s largest trading partners.

With the U.S. withdrawal, Beijing can offer what Kabul needs most: political impartiality and economic investment. Afghanistan in turn has what China most prizes: opportunities in infrastructure and industry building — areas in which China’s capabilities are arguably unmatched — and access to $1 trillion in untapped mineral deposits, including critical industrial metals such as lithium, iron, copper and cobalt. Though critics have raised the point that Chinese investment is not a strategic priority in a less secure Afghanistan, I believe otherwise.


Digital Yuan

Through the ages, money has taken various forms, (shells, stones, beads, various types of coins where the value was inherent in the material that the coin was made from and other that used a worthless material but assured by some kind of backing like gold, or simply trust in sovereign promises).

In terms of paper money, in the 13th century, the Chinese emperor Kublai Khan embarked on a bold experiment. China at the time was divided into different regions, many of which issued their own coins, discouraging trade within the empire. So Kublai Khan decreed that henceforth money would take the form of paper.

This was a huge step and even today we use paper money to an extent, but more and more we use digitized currencies. It is not strange that China again comes up with the major step of disintermediating the current technology of money by the creation of its DCEP. (This is not a cryptocurrency, however, technologically, it functions like one).  Transactions are fast, the basis is cash, and China is building it out as a two tier system (PBC and local banks assuring stable financial infrastructure and supervision, which, in effect, is the ‘backing’), as well as multi-scheme, which is the connection to retailers and third-party payment platforms (think of something like Paypal). Ownership of the currency business is then an open new market economic category.

We see more and more countries following suit but there is no one that is as far along as China on roll-out of digital currency, already trading with it, using it via smart contracts and more and more in cross border trade.

China builds cross-border finance blockchain platform

http://www.news.cn/english/2021-08/25/c_1310148785.htm

As all technology changes, the technology of money will also change and in reality, is in the process of change as we speak. The size of the change in financial technology spearheaded by China could well be of the magnitude of (as was the acceptance of paper money) the whole world, just as Kublai Khan created his system in the 13th century. The prospective use cases of digital money at this level staggers the imagination and the strength of an economic weapon of this kind is routinely underestimated.


While we have money going all digital, why not do the same with the rest:

Following China’s push for a digital currency, the country plans to roll out digital driver’s licenses nationwide by 2022. Nearly 2 million residents have obtained digital driver’s licenses so far, as cited by Xinhua. Digital licenses will have the same legal effect as physical licenses and can be used to rent vehicles, file insurance claims and handle traffic violations. An official mobile app accepts applications for a digital license. 400 million people are licensed to drive in China. Read full article →


Space, yes, one cannot get away from China these days without talking about space.

A Chinese satellite has tested a technology that could offer the most accurate means yet of tracking air traffic from space, in the hope of preventing repeats of the Malaysia Airlines Flight 370 tragedy. Each aircraft in the sky emits a radio signal, and constantly monitoring all planes over a large area is technically challenging. But Beihang Kongshi 1, a small satellite in near-Earth orbit, can update the status of an aircraft every eight seconds – about twice as fast as American technology, meaning the tracking is more accurate. Read full article  $→

In the mean time the Mars Rover is an unadulterated success. The National Space Administration said on its website Friday that Zhurong completed its 90-day program on August 15 and was in excellent technical condition and fully charged. Read full article →


Technology and Legal

In modern terms, China is a young country and in certain areas, specifically technology, legal structures lag behind technological development. This is not new if you are in technology but given the size and growth of China’s technology sector, may create some problems. In case you’ve been living under a very large rock: Regulators in Beijing have been on a mission to constrain the market dominance of China’s tech behemoths for months now. The principle value in the technology companies is that of building big fast and getting rich fast. But, the common value in the Chinese government is ‘common prosperity’. Wealth inequality is not as pronounced as in the west and China wants to keep it that way.  You may build big fast and get rich fast, but do not forget the country that gave you the platforms to create your behemoth of an industry.  Get rich, but not too rich.

The new legislation has all kinds of knock-on effects.  For example, labor laws (for one) and the value of all work and no play is being shaved. For example, ‘996’ work hours are illegal. “The ‘996’ work culture — a 12-hour, six-day work schedule that had been popular among Chinese tech companies until recently — is a serious violation of Chinese labor law, according to China’s Supreme People’s Court and its Ministry of Human Resources and Social Security.” Read full article →


Defense

The People’s Liberation Army Rocket Force has improved the accuracy and range of its ballistic missile force, the world’s largest, according to a new US Army report. The DF-11, the most widely deployed short-range ballistic missile, was originally designed to hit targets up to 300km away, but newer models have expanded ranges beyond 700km. “Accuracy has also increased, reducing” the intended target point to only 30m, “giving theatre commanders a long-range precision strike capability”, according to the army publication. The DF-11 can employ both conventional and nuclear warheads. The “solid-fuel rocket and mobile transporter-erector-launchers enable rapid launch and reload operations”, it added. Read full article $→

China has successfully tested two short-range conventional missiles designed to take out enemy communications systems. The PLA Rocket Force recently tested two new missiles that can overcome “complex electromagnetic interference” to destroy facilities in a “fast-reaction” operation. “[The missiles] successfully hit the target in an enemy camp equipped with multilayer defences several hundred kilometres away and effectively paralysed the enemy’s key communications node,” CCTV reported. Read full article $→


The legal machinations around Huawei CFO Meng Wanzhou house arrest in Canada seem to be drawing to a close, if in fact it will be allowed to draw to a close. Jeff J. Brown provided a solid analysis and background of the story.

http://en.people.cn/n3/2021/0822/c90000-9886670.html


To conclude, yes, the elephants are back home but nobody is betting that they will stay home this time. They may at any time decide to again go on a walk-about.

And on Winnie the Pooh:


Selections from Godfree Roberts’ extensive weekly newsletter: Here Comes China. You can get it here: https://www.herecomeschina.com/#subscribe

Further selections and editorial and geopolitical commentary by Amarynth.