24 September, 2021 – Stealth War 56: Cryptocurrency Trading Ban; Coal Power Plants Abroad; PLAAF Swarms Taiwan; BRI in Africa; Outrage toward Evergrande

By: Jamestown Foundation

Wed October, 2021, Age: 2 years


September 24, 2021

Welcome to the Stealth War Newsletter, a collection of the top 5 recent news items, collected on The Jamestown Foundation’s new website, stealth-war-org.cdn-pi.com. To continue to receive this weekly collection, click the button below to subscribe. 

Strategic Indicator
This issue’s number to watch102
Number of times that the United States has interfered in Hong Kong’s internal affairs since 2019 according to Chinese authorities.

This Week:

* China Bans Cryptocurrency Trading

* Xi Pledges to Stop Building Coal Power Plants Abroad as China Engages in Domestic Coal Binge

* PLAAF Swarms Taiwan After CPTPP Membership Application

* BRI: The Belt and Road Gets Bumpy in Africa

* Popular Outrage toward Evergrande Rises in China

Top Stories

(source: VCG)

China Bans Cryptocurrency Trading

On Friday, the People’s Bank of China declared cryptocurrency transactions illegal, causing the value of Bitcoin to drop by nine percent. While cryptocurrencies do not have legal tender status in China, all cryptocurrency businesses have been outlawed, including transactions between sovereign and virtual currencies, as well as the selling of goods and services for cryptocurrencies. The central bank’s announcement also noted that cryptocurrencies are used in money-laundering and other criminal schemes. In addition, cryptocurrencies have the potential to undermine the Chinese government’s control over the country’s financial system. The Chinese government has barred banks from using cryptocurrencies since 2013, but has intensified its crackdown this year as cryptocurrencies grow in global popularity. In May, Beijing warned that cryptocurrency traders would not receive any financial protection, and in June, China banned cryptocurrency “mining.” Cryptocurrency mining is an electricity-intensive practice, which has contributed to China’s soaring demand for coal. As of March 2021, China accounted for 46 percent of global cryptocurrency mining although the figure has not been updated in light of recent industry regulations. China’s cryptocurrency crackdowns are also consistent with its broader regulatory actions against private businesses such as Ant Group and Tencent to tighten control over the economy.

Xi Pledges to Stop Building Coal Power Plants Abroad  even as China Engages in Domestic Coal Binge 

In a virtual address to the UN General Assembly, General Secretary Xi Jinping pledged that China “will step up support for other developing countries in developing green and low-carbon energy, and will not build new coal-fired power projects abroad.” The promise by China, which is the last major exporter of coal power generation technology, follows similar pledges by Japan and South Korea earlier this year. Xi’s vague promise was greeted with guarded enthusiasm by climate change experts and advocates. However, in covering Xi’s UNGA speech, the international media largely neglected to note that China is building coal power plants on a massive scale domestically. Per Yale’s Environment 360 blog: “A total of 247 gigawatts of coal power is now in planning or development, nearly six times Germany’s entire coal-fired capacity.” This continued reliance on coal, which makes up the majority of China’s energy mix, actually precipitated a 4% increase in China’s CO2 emissions in the second half of 2020. With Beijing’s concerns over energy security mounting amidst US-China competition, and energy demand remaining high, China is unlikely to wean itself off of its coal addiction any time soon.

(source: Global Times).

PLAAF Swarms Taiwan after CPTPP Membership Application

This Thursday, China sent 24 warplanes into Taiwan’s Air Defense Identification Zone (ADIZ) in a display of force. China has sent warplanes into Taiwan’s airspace frequently over the past year, and has made larger scale intrusions following political events that it views as violating its sovereignty. The most recent incursion followed Taiwan’s announcement last Thursday that it had submitted an application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). As expected, this triggered a quick response from the People’s Republic of China (PRC) which considers Taiwan part of China. The PRC also submitted an application to join the CPTPP on Tuesday.

The CPTPP is an important opportunity for Taiwan, which is excluded from most international organizations. The decision rests on the eleven members, who must make a unanimous decision to allow new members to join. The PRC claims that Taiwan is using the CPTPP application as a secession move toward secession.

BRI Roundup

(source: China Daily)

BRI: The Belt and Road Gets Bumpy in Africa

Several countries in Africa— notably Ghana and the DRC— have decided to cancel their contracts with China for major infrastructure projects due to concerns over excess debt, and unfair business practices. “Those with whom his country signed contracts are getting richer while DRC people remain poor,” said the DRC president, Felix Tshisekedi.

Ghana has canceled the $100 million contract with China’s Every Way Traffic and Lighting Tech Co Ltd, which was set to create an intelligent traffic management system for the country. Meanwhile, the President of the DRC has announced that he wants a 2008 contract with China to be re-evaluated, citing that the deal signed with Sinohydro Corp and China Railway group was exploitative and unfair. The companies agreed to build roads, hospitals and bridges in the DRC in exchange for a majority stake in the country’s Sicomines business. While the Chinese companies are profiting off the DRC’s mining business, very little infrastructure projects have been completed.

This is not the first time a major Chinese project has faced skepticism in Africa. In 2020, a Kenyan high court canceled a $3.2 billion railway contract with China. In 2018, a $400 million airport funded by China was canceled by the country’s government after the president deemed the project unviable.

There’s no sign of this trend slowing down. With the announcement that China’s exports will cease to rely on coal, plans to construct a $15 million coal powered plant in Zimbabwe could run the risk of will almost assuredly being canceled. Zimbabwe, along with several other African partners, will likely have to cancel scheduled or ongoing coal-powered projects with China

(sources: China Daily)

Evergrande and Fury From People in China, Specifically Towards the CEO

As Evergrande missed its payment deadline on Thursday, investors and regulators have been focused on whether the company will collapse due to its debt load of over $300 billion. Home buyers are waiting on as many as 1.6 million apartments to be completed and around 70 to 80 percent of Evergrande employees across China were asked to lend money to help fund Evergrande operations; they were told to give a short-term loan if they wanted to keep their bonuses this year. Revelations of the company’s financial woes have generated anger that has sparked protests by employees and home buyers at Evergrande’s headquarters in Shenzhen. Protesters claimed that Evergrande owed them money, and were removed by security.

Popular anger toward Evergrande’s CEO Xu Jiayin in particular, may play into  Xi’s “common prosperity “campaign, which seeks to narrow China’s massive wealth gap by targeting the mega-rich, and private sector industries such as technology, entertainment and for-profit education sectors.

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