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Manasseh Sogavare, the Prime Minister of the Solomon Islands, moved to calm Australian fears about his country's new security pact with China. 

In an interview with The Guardian, Sogavare said there will never be a Chinese military base in the Solomon Islands because it would make the small island state an "enemy" and “put our country and our people as targets for potential military strikes.”

Sogavare met separately with his Australian and New Zealand counterparts, Anthony Albanese and Jacinda Ardern, on the sidelines of the Pacific Islands Forum in Fiji. The meetings were their first time since signing the controversial security pact.

He told The Guardian that Australia would remain "the security partner of choice" for the Solomons and that he would only call on Chinese security assistance if there were a "gap" Australian forces couldn't fill. 

SUGGESTED READING:

• The Guardian: Solomon Islands PM rules out China military base and says Australia is ‘security partner of choice’ by Lice Movono and Kate Lyons
• Reuters: Solomon Islands PM meets Australian, NZ leaders over China pact

The Wall Street Journal has published a highly critical account of China's involvement in Sri Lanka's debt crisis. It quotes current and former Sri Lankan officials claiming that China discouraged them from seeking an early IMF bailout, offering loans for liquidity support instead.

The choice to hold off on reaching out to the IMF meant that the country ended up using much-needed foreign reserves to repay loans:

“Instead of making use of the limited reserves we had and restructuring the debt in advance, we continued to make debt payments until we ran out of all of our reserves [...] If you had been realistic, we should have gone [to the IMF] at least 12 months before we did.” said Ali Sabry, Sri Lanka's caretaker Minister of Finance from April to May 2022.

The death of Angola's former president Jose Eduardo dos Santos on 8 July, brought to an end a pivotal Africa-China relationship, one that reshaped the whole continent's relationship with the rising superpower. 

This great obit by South China Morning Post's Jevans Nyabiage, shows how Dos Santos, initially a Soviet ally, warmed up to China and how they set up the oil-for-infrastructure deal called the "Angola Model," which was replicated across the Global South. Angola's debt to China still makes up a third of all Chinese loans to the continent.

Chinese agricultural inspectors have concluded an audit of Kenyan avocado crops and warehouses, raising hopes that exports to China can finally begin.

The audit is only the latest hurdle facing farmers hoping to access the Chinese market. Earlier, they were temporarily forced to flash-freeze avocadoes as part of China's phytosanitary rules. 

SUGGESTED READING:

• Business Daily: China Ready with Avocado Exports Audit, Says Agency
• China Global South Project: Kenyan Avocado Farmers Will Have to Jump Through One More Hoop Before Exports to China Can Begin by Eric Olander

Iran will become a full member of the Shanghai Cooperation Organization in April 2023, according to the Chinese state newspaper Global Times.

Iran has lobbied to join the Eurasia-spanning group for more than a decade, and its acceptance is sure to further boost its ties with China.

For some reason, the Chinese state broadcaster CGTN went out of its way to avoid naming Huawei by name in a recent report about the company's role as the primary technology service provider for Safaricom's popular mobile payment service M-Pesa.

This is odd, given that Chinese propaganda has unabashedly promoted Huawei in Africa and other developing regions in response to U.S. pressure on the company.

Meng Wei, Huawei's well-known managing director in Kenya, was described on-screen only as the "Head of the Kenya Representative Office of a Chinese Technology Provider."

Figuring out the Chinese messaging strategy in clumsily trying to conceal both Meng's and Huawei's identities in their story is puzzling.

Yang Jiechi, one of China's most senior foreign policy officials and a politburo member, visited Pakistan, The UAE, Mozambique, and Zimbabwe earlier this month and gave a rare interview to Xinhua about his trip. 

While he mostly stuck to official talking points, his comments also revealed specific issues in China's relations with these countries, including preparations for a China-Arab summit and a free trade agreement with the Gulf Coast Countries, security concerns in Pakistan, and ongoing civil society campaigns against Chinese firms in Zimbabwe.

Notable Data Points From Yang Jiechi's Recent Asian and African Tour:

• PAKISTAN: "China and Pakistan agreed to continue to firmly support each other in safeguarding national sovereignty, security and territorial integrity. The two countries pledged to further align development strategies and policy priorities [...] Pakistan will comprehensively strengthen security measures. Both China and Pakistan stressed that they will fight against all forms of terrorism."

• MOZAMBIQUE: "Mozambique said it will use the 2023-2024 term as a non-permanent member of the UN Security Council as an opportunity to strengthen coordination with China on a series of major international and regional issues, so as to effectively safeguard the common interests of the vast number of developing countries." 

• ZIMBABWE "China welcomes the export of more high-quality agricultural products from Zimbabwe to China [...] Zimbabwe welcomes Chinese enterprises to expand investment in Zimbabwe, opposes any rumors and smears against Chinese enterprises, and will continue to provide a good business environment for Chinese enterprises in Zimbabwe."

SUGGESTED READING:

• XINHUA: "Yang Jiechi's Interview with Xinhua News Agency at the End of His Visit to Four Asian and African Countries" (in Chinese)
• DEVDISCOURSE: "Top China Diplomat meets Zimbabwe President, Hopes to make Inroads in Africa"

The Chinese battery metals company Ganfeng Lithium Co. will spend $962 million to buy 100% of the Argentinian lithium compounds producer Lithea. The company owns lithium salt lakes with a capacity of 30,000 tons of lithium carbonate per year. 

Ganfeng Lithium has expanded rapidly, with projects in Mexico, Ireland, and Mali. Other Chinese battery metals giants like Zijin are also pouring money into Argentina, seen as the country with the biggest pipeline of lithium products.

SUGGESTED READING:

• Bloomberg: "China Lithium Giant Expands in Argentina With $962 Million Deal" by Annie Lee
• Financial Times: "China’s Ganfeng Lithium Buys Lithium Mines in Argentina" by Harry Dempsey

It appears that sources within the Saudi Arabian Royal Air Force are leaking information about their apparent interest in acquiring and possibly even manufacturing FC-31s, China's most advanced stealth fighter jet.

Saudi news reports also indicate that the Chinese are also prepared to transfer the technology to build the FC-31 locally.

The timing of these leaks in the Saudi Arabian and broader Arabic-language media is worth considering, given that they were published just one week before U.S. President Joe Biden is set to arrive in Riyadh.

Saudi Arabia is one of the world's largest customers of U.S. armaments, and a pivot to buy FC-31s or other high-tech Chinese weapons would likely be seen as a major setback in Washington, D.C.

SUGGESTED READING:

• Jane's Defense: China to promote FC-31 for export by Alessandra Giovanzanti
• Global Times: China establishes office to promote exports of the FC-31 stealth fighter by Liu Xuanzun

Chinese foreign direct investment in BRI countries jumped 10.2% to $8.2 billion in the first five months of the year, according to new data from the Chinese government. Singapore, Indonesia and Pakistan were among the top FDI destinations in 2022. But the news wasn't so good for Chinese enterprises. That same period saw an 18% decrease in the value of signed contracts in BRI countries. (XINHUA SILK ROAD -- in Chinese)

China bought a record amount of Russian oil in June, displacing Saudi Arabia as Beijing's top supplier for the second consecutive month. In the three-month period through May, Chinese oil buys from Russia doubled year-on-year to $18.9 billion and now account for 15% of China's total imports. Saudi shipments, meantime, are forecast to fall to a two-year low. (REUTERS)

At least 30 Nigerian soldiers were killed after being ambushed during a search and rescue operation for kidnapped mine workers, including four Chinese nationals. The incident took place late last week in Niger state. Authorities are unclear who was responsible for the attack and if they are connected with the bandits who abducted the Chinese miners. (REUTERS)

The small West African country of Gambia took the extraordinary step to ban all timber exports in a desperate effort to stop the illegal logging trade. Much of this pirated timber goes to China. The government also revoked all timber export licenses and added that the ban goes into effect immediately. The move is a last-ditch effort to stop the trade in illicit rosewood that is prized among Chines furniture manufacturers. (REUTERS)

Iran is discounting the already below-market-rate oil that it sells to China in a bid to compete with surging Russian oil exports. Russian exports to China surged to a record in May, with the OPEC+ producer overtaking its cartel ally Saudi Arabia as the top supplier to the world’s biggest importer. Some of that Russian oil has also come at the expense of Iran's share of the Chinese market. Until recently, Iran accounted for about 7% of Chinese imports. (BLOOMBERG)

For the second time this year, India's agency focusing on financial crime raided the offices of a major Chinese technology company as part of an investigation into money laundering allegations. Officers from the Enforcement Directorate swept through the New Delhi offices of the smartphone giant Vivo on Tuesday. This latest raid comes just months after the same agency targeted Xiaomi for alleged illegal remittances abroad "in the guise of royalty" payments. (REUTERS)

Saudi Aramco announced it will raise the price of crude for its largest Asian customers, including China, by $2.80 a barrel from July to $9.30 above the regional benchmark, almost a record high. The Saudi move comes just one day after Iran said it would lower prices for Chinese customers in order to better compete with the heavily-discounted Russian oil that is now flooding the Chinese market. (BLOOMBERG)

A controversial Franco-Chinese oil project that would connect oilfields in a Ugandan National Park to a port in Tanzania breaches global environmental guidelines for banks, according to a new nonprofit report Tuesday. The 1443-kilometer East Africa Crude Oil Pipeline (EACOP), planned by French oil giant TotalEnergies and China's CNOOC has been mired in allegations of human rights abuses and environmental hazard. The report by the NGO Inclusive Development International says the project repeatedly violates environmental and human rights standards that many of the project's financial backers have pledged to respect. (ASSOCIATED PRESS)

Sri Lanka will host an international donors conference with its largest creditors from China, Japan and India. Prime Minister Ranil Wickremesinghe told the parliament this week that the conference will be held once a staff-level deal is reached with the IMF on a bailout package. Japan and China are SL's two largest bilateral creditors, each accounting for about 10% of the country's external debt. (ECONOMIC TIMES)

Tesla's across-the-fleet price increase this month was due in part to supply constraints of key metals used to manufacture electric vehicle batteries, specifically lithium.  

While the price of cobalt and nickel have steadily fallen this year due to ample supplies from places like the DR Congo (cobalt) and Indonesia (nickel), lithium is proving much harder to source in the quantities needed to meet market demand.

Lithium's stubbornly high price explains partly why Chinese EV giant BYD is now moving to buy mines in places like Chile and why copper/cobalt mining companies like Zhejiang Huayou are making big acquisitions in the lithium sector.

Watch for this trend to intensify over the next 18-24 months.

The South African subsidiary of Chinese mining giant Zijin will build southern Africa's first-ever 5G connected mine using Huawei technology.

South Africa Zijin Platinum contracted with SA telco major MTN to build the Huawei network at the Limpopo mine in northern South Africa near the borders with Zimbabwe, Botswana and Mozambique.

According to the companies involved, the deployment of so-called "smart mining" technology aims to improve automation and worker safety.

SUGGESTED READING:

• Mining Weekly: Zijin invests in 5G solution to create a smart South African mine by Marleny Arnoldi 
• IOL: Zijin in partnership with MTN and Huawei to build southern Africa’s first 5G enabled mine by Philippa Larkin

For years, the Chinese internet reflexively defended all compatriots against any charges of anti-Black discrimination or racism. "China and Chinese people DO NOT DISCRIMINATE. Period." was the line that came back against any accusation by foreigners of Chinese maltreatment of Black people in places like Guangzhou in 2020 or in popular culture.

But the recent BBC Africa documentary "Racism for Sale," which documented the highly exploitative practice of Africans (including children) being coached to say demeaning things about themselves in Mandarin in short videos sold on Chinese social media platforms, triggered a different reaction.

Rather than nationalistic rallying, many online commentators spoke out forcefully against the transgressions of the documentary's main antagonist, Lu Ke, who produced hundreds, likely thousands, of these videos from his base in rural Malawi:

• “Chinese should support Malawi to strictly punish Lu Ke according to the law and we should also do better to improve our understanding of Africa that is based more on reality and less on the kind of fantasy and imagination that provided opportunity for people like Lu Ke" (GLOBAL NEWS)

• "People like Lu Ke disregarded the reputation of the country (Malawi) and ignored basic moral ethics and the rule of law." (HUASHENG ONLINE)

To be sure, there were certainly quite a few nationalist responses to the documentary. These tend to repeat accusations that the BBC is intentionally trying to make China look bad abroad. But, unlike earlier racism scandals, they weren't the only voices and not even the loudest ones.

Iran is the second country this week, after Argentina, to submit an application to join the BRICS club. The BRICS group is increasingly seen by both Beijing and Moscow as a potential alternative to the Western-led international economic order. Although the BRICS states have agreed to expand their membership, they haven't said how many countries they plan to accept and what the criteria are. (REUTERS)

Argentine President Alberto Fernández formally requested to join the BRICS club as part of his ongoing effort to more closely align with Russia and China. “We aspire to be full members of this group of nations,” President Fernández said on Friday during a virtual leaders summit hosted by China. BRICS leaders have indicated they are considering expansion but have not specified which countries they plan to admit first. (MERCOPRESS)

Chinese President Xi Jinping announced Beijing would contribute an additional one billion dollars to its South-South Cooperation Assistance Fund that supports low-income countries in their pursuit of the UN's sustainable development goals. China has already committed $3 billion to this fund. The President made the announcementon Friday at the conclusion of the 14th BRICS Leaders Summit.(BUSINESS STANDARD)

China took another big step on Saturday in its ongoing effort to internationalize its currency by signing an agreement with the Bank of International Settlements to create a Renminbi Liquidity Arrangement (RMBLA) with five other central banks around the world. According to the deal, Indonesia, Malaysia, Chile, Singapore, and Hong Kong would all contribute $2.2 billion in either yuan or USD that they can draw on in the future if they need liquidity. (REUTERS)

Kenya borrowed money from other creditors in order to make a $149 million loan payment to the China Exim Bank, according to new documents released by the National Treasury.  The Treasury document, though, does not specify from where the government borrowed the money to repay the Chinese debt. In all, the government restructured $199 million of debts using newly borrowed money. The China Exim Bank stands apart from Kenya's other bilateral creditors by refusing to extend a debt repayment moratorium. (THE STANDARD)

Chinese bauxite imports surged to an all-time monthly record in May, jumping 31% compared to the same time last year. Guinea and Indonesia were the largest beneficiaries with sales spiking 32% and 41% y-o-y respectively. Strong Russian demand for Chinese alumina products is partly responsible for the increase, according to traders. (S&P GLOBAL)

The surging price of oil is helping the Angolan government to pay down its (still massive) debts to China, according to London-based market research company REDD Intelligence. Debt owed to Chinese creditors decreased by $351 million in the first quarter of this year to $21.4 billion, after having been stable at close to $22 billion for the past two years. Angola accounts for about a third of all Chinese debt in Africa. (SOUTH CHINA MORNING POST)

China's powerful Ministry of State Security is calling on the Pakistani government to allow the deployment of armed Chinese private security contractors to protect its interests in the South Asian country.  Pakistani authorities, however, have reportedly resisted the idea, claiming their own security forces are sufficient to protect Chinese people and property. But Chinese officials remain concerned about further attacks from separatist militants who killed three language instructors in a suicide bombing in April. (NIKKEI ASIA)

China called for "urgent and decisive actions" to protect the Palestinian people's "right of self-determination." Beijing's envoy to the United Nations, Zhang Jun, renewed criticism this week of Israeli settlements that "encroach upon Palestinian land and natural resources." China is a longtime supporter of the Palestinian cause but its latest criticism of Israel comes just a couple of weeks after the Jewish State signed a joint statement that expressed concern over the human rights situation in Xinjiang. (XINHUA)

China's top foreign policy official, Yang Jiechi, embarked on a four-nation, five-day tour in the Middle East, South Asia, and Africa.  Yang, who is also a member of the powerful Politburo, will travel to Pakistan, the UAE, Zimbabwe, and Mozambique. The Foreign Ministry did not specify what would be on his agenda during each stop. (CHINESE MINISTRY OF FOREIGN AFFAIRS)

China's envoy to the United Nations, Zhang Jun, slammed NATO for labeling China as a source of "systemic challenges" and warned the alliance "not to look for imaginary enemies in the Asia-Pacific." In Beijing, Foreign Ministry spokesman Zhao Lijian was equally pointed in his criticism, urging NATO not to "mess up Asia and the whole world after messing up Europe.” (NEWSWEEK)

New problems in the global supply chain are beginning to emerge as Vietnamese textile manufacturers report they're running low on raw materials sourced from China due to a lack of shipping containers. The disruption has prompted some garment manufacturers to curtail operations while they look for new suppliers outside of China.(FIBER2FASHION)

A Xinhua headline from Wednesday hints that years of criticism of low-quality Chinese-built infrastructure in developing countries may be having its desired effect.

Chinese messaging on these issues used to focus on the speed of delivery or the low cost of construction. But the fact that Xinhua's story on the completion of a 53km section of the Trans-Saharan Highway in Algeria focused on quality may be a direct response to those earlier critiques and a preview of what's to come in the burgeoning contest between the G7's new PGII and the BRI.

The UAE's ambassador to China, Ali Obaid Al Dhaheri, met with the President of Sinopharm, Liu Jinchen, at the embassy in Beijing this week to discuss how the two sides can enhance their current partnership.

The Emirates has become a very important outpost for the Chinese pharmaceutical company as a key manufacturing hub and locale for clinical trials of its COVID vaccines.