Our picks: China watchIndustrial Policy Bill to Counter China | China Threat Meets the China Reality | China Turning Water-Scarcity into a Weapon, and more

Senate Poised to Pass Huge Industrial Policy Bill to Counter China  (David E. Sanger, Catie Edmondson, David McCabe and Thomas Kaplan, New York Times)
The broad support for the bill highlights how competition with Beijing is one of the few issues that can still unite both political parties.

China Is Turning Its Water-Scarcity Crisis into a Weapon  (Therese Shaheen, National Review)
Antagonizing neighbors, imposing top-down solutions, and not actually solving the underlying problem — as China in other areas, so with water.

The Shifting Sino-American Trade Story  (Milton Ezrati, National Interest)
It has become apparent that American business and industry have shifted decisively away from Chinese sourcing, in part because of China’s nationalist positioning during the pandemic.

Huawei’s Global Cloud Strategy: Economic and Strategic Implications  (Jonathan E. Hillman and Maesea McCalpin, Reconnecting Asia)
Huawei has made its cloud business a strategic priority. With U.S. sanctions limiting its access to mobile semiconductors, cloud computing has become integral to its survival. The pandemic provided a boost, accelerating global adoption of cloud services by one to three years and growing Huawei’s cloud revenue by 168 percent during 2020, according to Ken Hu, Huawei’s rotating chairman. “It is our goal to make it as convenient for customers to use Huawei’s cloud services as electricity,” Huawei CEO Ren Zhengfei said in a speech last year.
As it seeks to achieve that goal, Huawei is gaining traction in the developing world. The CSIS Reconnecting Asia Project examined open sources and identified 70 deals in 41 countries between Huawei and foreign governments or state-owned enterprises (SOEs) for cloud infrastructure and e-government services through April 2021. As illustrated in the map below, these deals are concentrated in developing countries.

The China Threat Meets the China Reality  (Scott Lincicome, CATO / The Dispatch)
On the list of Washington priorities right now, the need to do something about China is at or near the top, and therefore motivates a lot of policy proposals—often seeded by lobbyists or special interest groups—that politicians might otherwise oppose. For example, we see supposed free marketers supporting protectionism and industrial policy not because they’ve seen the interventionist light but because the China’s growing economic and geopolitical power—both supposedly fueled by Chinese government industrial policy—is so serious that it demands we abandon, just this one time, the market to save it (or something), or that we accept dozens of ridiculous, irrelevant, and/​or self‐​serving amendments to “innovation” legislation because it’s the lone legislative vehicle for Congress to do something about China this year. 

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However, while China’s deepening authoritarianism, human rights abuses, and other bad behavior surely warrant criticism and attention, the view of China, and Chinese industrial policy, as an urgent economic threat to the United States—one justifying a broad rejection of the free markets and economic openness that made America great to begin with—is mostly misguided.

China’s Potemkin Peacekeeping  (Bradley Bowman and Morgan Lorraine Viña, The Dispatch)
The CCP is using its increased U.N. peacekeeping presence to shift international norms about human rights.

How China Steals U.S. Tech to Catch Up in Underwater Warfare  (Ma Xiu and Peter W. Singer, Defense One)
In late April, Massachusetts-based businessman Qin Shuren became the latest person to plead guilty in the Justice Department’s crackdown on the illegal export of strategic technologies. Qin’s company, LinkOcean Technologies, falsified documentation to send a Chinese military-affiliated university some $100,000 worth of equipment, including hydrophones, sonobuoys, side-scan sonars, and even an autonomous underwater vehicle (AUV). The case is just one part of a long trail of open-source evidence that illustrates a larger issue: U.S. technology being used to advance Chinese military ends.

Mapping China’s Tech Giants: Covid-19, Supply Chains and Strategic Competition  (Samantha Hoffman, Strategist)
Mapping China’s Technology Giants is a multi-year project by ASPI’s International Cyber Policy Centre that tracks the overseas expansion of key Chinese technology companies. This data-driven project, and the accompanying database and research products, fill a research and policy gap by building understanding about the global trajectory and impact of China’s largest companies working across the internet, telecommunications, artificial intelligence, surveillance, e-commerce, finance, biotechnology, big data, cloud computing, smart city and social media sectors.

iOS15: China Exempt from Apple “Private Relay” Privacy Feature  (BBC)
Apple has announced a raft of new privacy protections at its annual software developer conference.
They include a function called “private relay”, where users’ web browsing behaviour can be hidden from Apple, internet providers and advertisers.
Apple has been under pressure to cut down on the tracking of user data.
However, the feature will not be available to users in China, one of its most important markets, due to regulatory reasons.
It’s the latest compromise that the tech giant has made on privacy in China, where 15% of its revenue comes from.