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THIS WEEK:

Li Qiang visits Australia, New Zealand, and Malaysia; EV leaders and officials at the 2024 China Automobile Forum; testing times for Chinese students; Hong Kong specialist resigns from the CPPCC; and China to boost housekeeping and rural development.

1. Li Qiang Visits Australia, New Zealand, and Malaysia

What’s Happening: From June 13 to 20, Chinese Premier Li Qiang will visit New Zealand, Australia, and Malaysia.

The Great Southern Tour: The New Zealand and Malaysian governments are yet to release specific itineraries for Li’s trip beyond affirming that he will meet with senior officials. The Australian government has confirmed that Li will visit June 15–18, and while there, he will tour Adelaide, Canberra, and the mining state of Western Australia. In Canberra, he will co-chair the ninth China-Australia Annual Leaders’ Meeting with Prime Minister Anthony Albanese and jointly attend a China-Australia CEO roundtable meeting.

Gone Too Long: Premier Li’s trip marks the first time a Chinese premier has visited New Zealand or Australia in seven years and Malaysia in nine years. This year also celebrates the 10th anniversary of the establishment of China-New Zealand and China-Australia comprehensive strategic partnerships and the 50th anniversary of the establishment of China-Malaysia diplomatic relations.

Why It Matters: Australia, New Zealand, and Malaysia are important trading partners for China. Amid ongoing geopolitical instability, supply chain vulnerability, and changing regional dynamics, Premier Li’s visits will serve as a further step in reopening dialogues and furthering areas of cooperation and exchange after recent tensions.

By Taylah Bland, Fellow on Climate and the Environment, Center for China Analysis

Learn More: Read How Australia’s Relationship with China Went Down, and Then Up Again, and What Comes Next by ASPI Australia’s Richard Maude.

2. EV Leaders and Officials at the 2024 China Automobile Forum

What Happened: At the 2024 China Automotive Forum on June 7–8, top executives and officials from BYD, Geely, Changan, and GAC convened to tackle the electric vehicle (EV) industry’s “involution” woes and address claims of overcapacity from the global market.

Clash of the Titans: The forum provided a rare insider view as industry leaders and officials debated strategies to manage fierce competition, market saturation, and trade frictions. Wang Chuanfu from BYD argued that competition drives innovation and growth; but Zeng Qinghong from GAC criticized the self-destructive competition in the industry and advocated for “focusing on long-term strategy rather than engaging in involution.”

The Long Game: Wang Xia, chairman of the Automotive Industry Committee of the China Council for the Promotion of International Trade, provided insight into Beijing’s recent thinking on China’s EV industry. He emphasized the need for long-term strategies in a hyper-competitive atmosphere. Wang proposed building a new industrial ecosystem that will “lead to the restructuring of the industrial chain and the reconstruction of the benefit chain.”

Why It Matters: Chinese EV industry leaders are not monolithic in their views on handling market competition, and Chinese officials are increasingly emphasizing the need to focus on technological innovation and move beyond price competition. A long-term strategy to build a healthier ecosystem where technological innovation thrives applies not just to the EV industry but also to other aspects of Xi’s ambitions for “new quality productive forces.”

By Lizzi C. Lee, Fellow on Chinese Economy, Center for China Analysis

Learn More: Following the Biden administration’s imposition of 100% tariffs on Chinese EVs, Lizzi suggested that the United States Must Rethink Its Strategy to Compete with China in the EV Market.

3. Testing Times for Chinese Students

What Happened: Over the past few days, 13 million students — the largest number ever — sat the notoriously difficult college entrance exam, the Nationwide Unified Examination for Admissions to General Universities and Colleges, or gaokao.

The Golden Ticket: Admission to a good college is a hard-fought privilege in China. Every year, during gaokao season, the Chinese Internet is inundated with stories about the brutal exam, like poor Mr. Liang Shi of Chengdu, who sat the exam for the 28th consecutive year. In cities across China, taxis give free rides to test takers, and flights are rerouted to prevent noise from disturbing test takers. In Yunnan province, a bullfrog was arrested by police for making a racket.

Peak Stress: The 13 million test takers this year set a record. But the number of gaokao test takers is set to decline in the coming years, both as the population declines and as more parents decide that the test is no longer worth the brutal stress it puts their children through.

Why It Matters: The gaokao, despite all the stress it entails, is seen by many as one of the few remaining meritocratic avenues of upward mobility for young people. Youth unemployment is high, and with 11.8 million college graduates expected to enter the workforce this year, competition for good jobs is fierce. Thus, a high gaokao score and subsequent entrance to a good university is no longer the golden ticket it once was.

By Barclay Bram, Fellow on Chinese Society, Center for China Analysis

Learn More: Take a look at CCA’s pioneering project, The 19 Percent, which advocates understanding China’s youth unemployment rate.

4. Hong Kong Specialist Resigns from the CPPCC

What Happened: On June 6, Zhang Xiaoming, a veteran in Hong Kong affairs, resigned from all roles in the Chinese People’s Political Consultative Conference (CPPCC).

Controversial Tenure: The resignation marks the culmination of a series of setbacks in his career, potentially linked to corruption investigations and a larger effort by Xi to dismantle the influence of the “Liao faction” in Hong Kong affairs. Zhang previously held high-profile roles as head of the Hong Kong Liaison Office and head of the Hong Kong and Macau Affairs Office of the State Council. His handling of the 2014 and 2019 pro-democracy protests in Hong Kong was controversial, and in 2022, the 15th Central Inspection Group deemed his performance unsatisfactory for failing to adequately contain political risks in the city. As a result, he was demoted to the CPPCC.

The Liaos: Zhang’s career was closely intertwined with that of Liao Hui, the first head of the Hong Kong Liaison Office. Liao Hui and his father, Liao Chengzhi, a prominent figure in Chinese diplomacy, held significant influence in Hong Kong affairs from the 1980s to the 2010s.

Why It Matters: Zhang’s resignation, coupled with recent reshuffles within the Ministry of Foreign Affairs and the Hong Kong governance sphere, indicates a broader shift in power. Xi Jinping appears determined to remove the influence of the “old guard” and establish tighter control over both foreign affairs and Hong Kong policy.

By Shengyu Wang, Research Assistant on Chinese Politics, Center for China Analysis

Learn More: As part of the top-level reshuffling, CCA Fellow Neil Thomas analyzed Wang Yi’s appointment as foreign minister and what it could mean for his ousted predecessor, Qin Gang.

5. China to Boost Housekeeping and Rural Development

What Happened: On June 11, China’s Ministry of Commerce, along with eight other departments, issued the “2024 Housekeeping and Rural Revitalization Action Plan.” 

Key Policies: The government's plan to strengthen the domestic services industry includes 25 measures focused on supply and demand, brand cultivation, increased government support, and improving the sector's business environment. It aims to expand job opportunities for rural migrant workers through job fairs and tailored training programs and vows to simplify subsidy applications and travel allowances for them, along with financial support for domestic service enterprises.

A Continuous Effort: The Chinese government has consistently worked to integrate domestic services with rural development. For example, the Ministry of Commerce previously laid out a “Housekeeping and Rural Revitalization Action Plan (2021–2025)” in 2021, and another plan in 2023 focused on poverty alleviation. Compared to its older versions, this plan offers more comprehensive strategies for the industry’s growth.

Why It Matters: The housekeeping industry in China employs over 30 million workers, with 90% coming from rural areas. The industry not only provides vital employment and income for rural workers but also offers essential services for an aging population and supports newborn care, crucial given China’s low birth rate. The 2024 plan seeks to bridge the urban-rural employment gap, enhance service quality, and support economic development, thereby improving living standards for rural workers and meeting the growing demand for domestic services.

By Jie Gao, Research Associate on Foreign Policy and National Security, Center for China Analysis

Learn More: In January, Asia Society Hong Kong hosted Scott Rozelle and Yiming Cao to discuss Rozelle’s new book, Invisible China: How the Urban-Rural Divide Threatens China’s Rise.