China Suspends Tariff Concessions on Taiwanese Goods

December 21, 2023

China Suspends Tariff Concessions on Taiwanese Goods

China’s State Council Tariff Commission has decided to suspend tariff concessions for certain products under the “Economic Cooperation Framework Agreement” (ECFA) with Taiwan, effective from January 1, 2024. This response comes after Taiwan imposed unilateral trade restrictions on mainland Chinese exports, breaching ECFA terms. The affected items include 12 tariff lines, such as propylene and para-xylene, which are crucial in the plastics and synthetic fibers industries. It represents an initial countermeasure seeking equal treatment, though further escalation remains possible if grievances persist.

The ECFA is a preferential trade pact signed between mainland China and Taiwan in 2010 aiming to reduce trade barriers and promote economic ties across sectors like goods, services, investments, etc. It is often viewed as a mainland concession to foster unification with Taiwan. This move signals a significant shift in cross-strait economic relations.


Advanced Tech Aids China’s Earthquake Rescue Efforts

China urgently deployed various high-tech systems to bolster emergency response operations after a deadly 6.2-magnitude earthquake rocked western Gansu Province on December 18th. State-of-the-art equipment like the domestically built Y-20 strategic airlifter, satellite imagery, and specialized drones rushed to the disaster zone, showcasing nationwide coordination.

Within hours after tremors severed infrastructure links, the hulking Y-20 took flight from an airbase hauling the Western Theater Command’s frontline coordinators along with 14 tons of vehicles and supplies. Its spacious hold and hefty capacity are well-suited for ferrying bulky relief goods here.

But hardware alone cannot survey the damage – timely eyes in the sky proved equally vital. Once the shaking subsided, Beijing marshaled an ensemble of civil observation satellites to snapshot post-quake conditions, prioritizing target areas’ automated systems flagged for their detail potential.

Stitching visual data from various commercial, military, and dual-use platforms enabled quicker routing of response units through treacherous terrain. Officials credited space assets for highlighting impassible roads plus displaced residents.

Specialized drones then filled blindspots across the mountains. An emergency variant of the medium-altitude long-endurance Wing Loong prototype directly flew from Sichuan to scout the epicenter. Its versatility in bridging communications could mean isolated villages’ communication is available first via the robot.  They were not just for scouting but also served as aerial platforms, relaying high-definition videos of the affected areas to the command centers in real-time. This function was crucial for extending the reach of the rescue efforts, providing commanders with up-to-date visual information from regions that ground teams couldn’t immediately access.

Remarkably, vital infrastructure repairs were completed rapidly even as technology aids continued flooding in. Just a day after landslides obstructed roads and powerlines, state-run utilities announced traffic restoration and electricity revival for worst-hit counties. This initial progress enabled more conventional assistance to press deeper toward settlements cut off by debris.

Currently, the focus has shifted from urgent rescue to treatment and resettlement after teams scoured the wreckage for survivors. With transport re-established, mobile hospitals rotated through makeshift camps for the displaced. Officials also assessed dangerously cracked reservoirs to avert flooding amid aftershocks. As rehabilitation gathers momentum, they say the hi-tech edge improved response time and effectiveness despite the deadly disaster’s scale.

As of December 20, the earthquake has resulted in 22 deaths and 198 injuries in Qinghai’s Haidong city, with 12 missing. In Gansu, 113 deaths and 782 injuries have been reported. A 4.1 magnitude aftershock occurred on December 21 in Jishishan County.


Chinese Coffee Chain Faces US$ 286 Million Lawsuit in Thailand

On December 19, Thailand’s Royal 50R Group filed a lawsuit seeking 10 billion Thai Baht, or around US$ 286 million in compensation from China’s Luckin Coffee. The Royal 50R Group claims to have registered the “Luckin” trademark in Thailand in 2020 for operating coffee shops before Luckin expanded overseas. The court initially ruled in favor of Luckin, considering it a case of “malicious registration,” but the Royal 50R Group contested the ruling and ultimately won the case. Luckin now awaits verification of the details, in its statement announced on December 20.

Luckin Coffee’s overseas expansion reflects the rapid growth of China’s coffee industry in recent years. In a report released in early December, China now has the most chain coffee shops in the World with a 58% annual growth rate, surpassing the U.S. Among the emerging coffee chains, Luckin contributed significantly to the growth, opening over 5000 shops in a year. In August, Luckin announced its quarterly revenue of US$ 852 million, overtaking Starbucks’ US$ 822 million in China.

But Chinese coffee chains, including Luckin, face uphill battles from time to time in paving their way to the markets. Before the trademark lawsuit in Thailand, Luckin faced allegations of financial fraud in January 2020, only half a year after its Nasdaq listing. This led to an 85% drop in its US stock price, and its mobile app crashed temporarily due to overwhelming demand for coupon redemption. With changes in management and releases of new products, Luckin overcame the obstacles over the next few years, and now seeks to expand overseas. However, for the Chinese coffee chains, the trademark lawsuit only marks the beginning of the challenges they may encounter in entering new markets.

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