The verbal skirmish grew out of China’s suspension of talks with the U.S. on climate and several other issues earlier this month.
The world’s two biggest emitters of greenhouse gases are sparring on Twitter over climate policy, with China questioning whether the U.S. can deliver on the landmark climate legislation signed into law by President Joe Biden this week.
“You can bet America will meet our commitments,” U.S. Ambassador to China Nicholas Burns tweeted in response on Wednesday, using a national flag emoji for “America.” He called on China to resume suspended climate talks, writing, “We’re ready.”
The punchy exchange, part of a longer back and forth on Twitter, is emblematic of a broader worry: U.S.-China cooperation is widely considered vital to the success of global efforts to curb rising temperatures. With the breakdown in relations over Taiwan and other issues, some question whether the two sides can cooperate.
After Congress passed the climate bill last Friday, Burns took to Twitter over the weekend to say the U.S. was acting on climate change with its largest investment ever — and that China should follow.
On Tuesday night, China’s Foreign Ministry responded with its own tweet: “Good to hear. But what matters is: Can the U.S. deliver?”
The verbal skirmish grew out of China’s suspension of talks with the U.S. on climate and several other issues earlier this month as part of its protest over a visit to Taiwan by a senior American lawmaker, House Speaker Nancy Pelosi.
Climate has been one of the few areas of cooperation between the feuding countries. U.S. officials criticized China’s move, with Secretary of State Antony Blinken saying it “doesn’t punish the United States — it punishes the world.”
Asked to respond, Chinese Foreign Ministry spokesperson Zhao Lijian called on the U.S. last week to “deliver on its historical responsibilities and due obligations on climate change and stop looking around for excuses for its inaction.”
The ministry later tweeted some of his answer, and Burns responded four days later with his tweet on the U.S. climate bill. Using the acronym for the People’s Republic of China, he ended with, “The PRC should follow+reconsider its suspension of climate cooperation with the U.S.”
China elaborated on its “Can the U.S. deliver?” message with a second tweet suggesting that the U.S. meet rich country pledges to help poorer countries cope financially with climate change and lift sanctions imposed last year on solar industry exports from China’s Xinjiang region because of allegations of forced labor.
The Twitter battle highlights a perception divide between the longstanding superpower that wants to lead and the rising power that no longer wants to feel bound to follow anyone else’s direction.
The decision by former President Donald Trump to pull the U.S. out of the Paris climate accord — reversed by President Biden after he took office last year — dealt a blow to American credibility on the issue.
A Chinese expert praised parts of the U.S. legislation but said it is overdue and not enough.
“Although there are some breakthrough achievements in the bill, I am afraid it can’t reestablish U.S. leadership on climate change,” said Teng Fei, a professor at Tsinghua University’s Institute of Energy Environment and Economy.
U.S. climate envoy John Kerry has been pressing China to set more ambitious climate goals. China has responded that its goals are realistic, given its development needs as a middle-income country, while the U.S. sets ambitious goals that it fails to achieve.
China’s ruling Communist Party generally sets conservative targets at a national level because it doesn’t want its performance to fall short. Those targets are sometimes exceeded, though, in the eager pursuit of those goals by local officials.
“China should be able to do better than its national targets indicate,” said Cory Combs, a senior analyst with the Trivium China consultancy. “But of course, those local plans are all subject to failure and delays, so it’s impossible to tell quite what they’ll add up to.”
Chinese artists have staged performances to highlight the ubiquity of surveillance cameras. Privacy activists have filed lawsuits against the collection of facial recognition data. Ordinary citizens and establishment intellectuals alike have pushed back against the abuse of Covid tracking apps by the authorities to curb protests. Internet users have shared tips on how to evade digital monitoring.
As China builds up its vast surveillance and security apparatus, it is running up against growing public unease about the lack of safeguards to prevent the theft or misuse of personal data. The ruling Communist Party is keenly aware of the cost to its credibility of any major security lapses: Last week, it moved systematically to squelch news about what was probably the largest known breach of a Chinese government computer system, involving the personal information of as many as one billion citizens.
The breach dealt a blow to Beijing, exposing the risks of its expansive efforts to vacuum up enormous amounts of digital and biological information on the daily activities and social connections of its people from social media posts, biometric data, phone records and surveillance videos. The government says these efforts are necessary for public safety: to limit the spread of Covid, for instance, or to catch criminals. But its failure to protect the data exposes citizens to problems like fraud and extortion, and threatens to erode people’s willingness to comply with surveillance.
for mishandling data. But the authorities rarely point fingers at the country’s other top collector of personal information: the government itself.
Security researchers say the leaked database, apparently used by the police in Shanghai, had been left online and unsecured for months. It was exposed after an anonymous user posted in an online forum offering to sell the vast trove of data for 10 Bitcoin, or about $200,000. The New York Times confirmed parts of a sample of the database released by the anonymous user, who posted under the name ChinaDan.
In addition to basic information like names, addresses and ID numbers, the sample featured details that appeared to be drawn from external databases, like instructions for couriers on where to drop off deliveries, raising questions about how much information private companies share with the authorities. Of particular concern for many, it also contained intensely personal information, such as police reports that included the names of people accused of rape and domestic violence, as well as private information about political dissidents.
leaked databases used by the police in China that were left online with little to no protection; some contained facial recognition records and ID scans of people in a Muslim ethnic minority region.
Now, there are signs that people are growing wary of the government and public institutions, too, as they see how their own data is being used against them. Last month, a nationwide outcry erupted over the apparent abuse of Covid-19 tracking technology by local authorities.
The Latest on China: Key Things to Know
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China’s economy stumbles. Hurt by lockdowns imposed to curb the spread of Covid, China’s economic engine has shuddered in recent months, as housing sales sagged, shops and restaurants shuttered and youth unemployment climbed. The slowdown has kindled doubts about the viability of the country’s stringent strategy of eliminating virtually all Covid-19 infections.
A financial scandal. Depositors from across the country descended on the city of Zhengzhou for a rare mass demonstration after the money they placed in rural banks using online, third-party platforms was frozen as investigators examined allegations of widespread fraud. The authorities responded with violence.
Forced labor. Mining companies in China’s western Xinjiang region are assuming a larger role in the supply chain behind the batteries that power electric vehicles and store renewable energy. But their ties to forced labor practices could portend trouble for industries that depend on materials from China.
Protesters fighting to recover their savings from four rural banks in the central Chinese city of Zhengzhou found that the mobile apps used to identify and isolate people who might be spreading Covid had turned from green — meaning safe — to red, a designation that would prevent them from moving freely.
“There is no privacy in China,” said Silvia Si, 30, a protester whose health code had turned red. The authorities in Zhengzhou, under pressure to account for the episode, later punished five officials for changing the codes of more than 1,300 customers.
posted on Weibo that he was refusing to wear an electronic bracelet to track his movements while in isolation, saying the device was an “electronic shackle” and an infringement on his privacy. The post was liked around 60,000 times, and users flooded it with responses. Many said the bracelet reminded them of the treatment of criminals; others called it a ploy to surreptitiously collect personal information. The post was later taken down by censors, the blogger said.
researcher on technology policy at Yale Law School and New America. “People are far more trusting overall in how government entities handle their personal information and far more suspicious about the corporate sector.”
Legal analysts said any disciplinary actions resulting from the Shanghai police database breach were unlikely to be publicized. There are few mechanisms in place to hold Chinese government agencies responsible for their own data leaks. For many citizens, that lack of recourse has contributed to a sense of resignation.
Occasionally, though, they notch small victories, as Xu Peilin did when she took on her neighborhood committee last year. She had returned to her apartment building in Beijing one day to find that the compound wanted residents to submit to a facial recognition scanner to enter.
“It was insane,” said Ms. Xu, 37, a project manager at a start-up company. She said it reminded her of one of her favorite television shows, the British science fiction series “Black Mirror.”
Ms. Xu badgered her neighborhood committee by telephone and text message until it relented. For now, Ms. Xu said, she can still enter her compound using her key card, though she believed it was only a matter of time until the facial recognition devices became mandatory again.
“All I can do for now,” she said, “is continue to resist on a small scale.”
FANGLIAO, Taiwan — Lin Chun-lai bought his grouper farm in southern Taiwan about a decade ago with an eye on mainland China’s growing appetite for live fish. In just a few years, the former electrician made enough money to comfortably support his family of four and even open a small inn.
Then China abruptly banned all imports of grouper from the island, in an apparent attempt at turning the economic screws on Taiwan, a self-governed island that Beijing claims as its own territory. The move cut Mr. Lin and other farmers like him off from their main market, putting their livelihoods at risk and dealing a huge blow to a lucrative industry.
Taiwan’s unification with China is inevitable, but most of Taiwan’s 23 million people are in favor of maintaining the island’s de facto independence. As Beijing has ramped up pressure on the island, Taiwan has moved to strengthen economic and diplomatic ties with friendlier countries, including the United States, those in the European Union and Japan.
In recent years, Beijing has sent military aircraft toward the island almost daily. It has tried to isolate Taiwan, peeling off its few remaining diplomatic allies and blocking it from joining international organizations. It has also increasingly sought to restrict the island’s access to China’s vast consumer market, banning Taiwanese pineapples, then wax apples, last year after it said the fruits brought in pests.
their ties to forced labor practices could portend trouble for industries that depend on materials from China.
In recent days, Taiwanese agricultural authorities have contacted grouper farmers to discuss ways that the government can help, including by providing low-interest loans and feed subsidies and expanding access to domestic consumers and overseas markets. Another idea being floated is to include the fish in individually packaged meal boxes sold at train stations and on trains by Taiwan’s railway administration. Taiwan’s Fisheries Agency said on Tuesday that the agency would spend more than $13 million to support the grouper industry.
Taiwan’s Council of Agriculture has said it would consider filing a complaint about the grouper ban to the World Trade Organization. Lin Kuo-ping, the deputy director general of the official Fisheries Agency, said the government had reached out to their Chinese counterparts to discuss the inspection process but had not heard back. China’s General Administration of Customs did not respond to an emailed request for comment.
Some grouper farmers said that if the ban was not lifted, they would have to settle for selling the fish on the domestic market at a huge loss. Until then, the fish will remain in the ponds. Mr. Lin, the grouper farmer, said he worried the groupers could die as a result of overcrowding.
He is now pinning his hopes on another kind of fish that he has been farming, the four-finger threadfin fish, which is also popular on the mainland. But he acknowledged that even this backup strategy was vulnerable to geopolitical shifts. Last year, Taiwan’s exports of the fish were worth nearly $40 million — and more than 70 percent went to China.
“Our biggest customer,” he said, “is still China.”
Building and installing enough solar panels to generate up to 45 percent of the country’s power needs will strain manufacturers and the energy industry, increasing demand for materials like aluminum, silicon, steel and glass. The industry will also need to find and train tens of thousands of workers and quickly. Some labor groups have said that in the rush to quickly build solar farms, developers often hire lower-paid nonunion workers rather than the union members Mr. Biden frequently champions.
Challenges like trade disputes could also complicate the push for solar power. China dominates the supply chain for solar panels, and the administration recently began blocking imports connected with the Xinjiang region of China over concerns about the use of forced labor. While many solar companies say they are working to shift away from materials made in Xinjiang, energy experts say the import ban could slow the construction of solar projects throughout the United States in the short term.
Yet, energy analysts said it would be impossible for Mr. Biden to achieve his climate goals without a big increase in the use of solar energy. “No matter how you slice it, you need solar deployments to double or quadruple in the near term,” said Michelle Davis, a principal analyst at Wood Mackenzie, an energy research and consulting firm. “Supply chain constraints are certainly on everyone’s mind.”
Administration officials pointed to changes being made by state and local officials as an example of how the country could begin to move faster toward renewable energy. Regulators in California, for example, are changing the state’s building code to require solar and batteries in new buildings.
Another big area of focus for the administration is greater use of batteries to store energy generated by solar panels and wind turbines for use at night or when the wind is not blowing. The cost of batteries has been falling but remains too high for a rapid shift to renewables and electric cars, according to many analysts.
To some solar industry officials, the Energy Department report ought to help to focus people’s minds on what is possible even if lawmakers haven’t worked out the details.
“In essence the D.O.E. is saying America needs a ton more solar, not less, and we need it today, not tomorrow,” said Bernadette Del Chiaro, executive director of the California Solar and Storage Association, which represents solar developers in the state with by far the largest number of solar installations. “That simple call to action should guide every policymaking decision from city councils to legislatures and regulatory agencies across the country.”
When Jeffrey Epstein gave The Times columnist James Stewart a tour of his apartment a few years ago, he boasted of his expansive Rolodex of billionaires — and the dirt he had on them. A year and a half after the financier’s death by suicide in a New York jail, the fallout for those in the registered sex offender’s orbit, and increasingly those a step or two removed from it, continues to spread.
For example, the latest management reshuffle at Apollo, as we reported yesterday, can be linked back to Epstein. Tracing all the resignations and reshuffles directly and indirectly tied to the scandal will take a while (we’re working on it), but here’s a tally of some so far:
The Apollo co-founder Leon Black said in January that he would resign as C.E.O. but stay on as chairman, after an internal inquiry found he had paid $158 million to Epstein for tax advice. He unexpectedly quit both posts in March, and later stepped down as chairman of the Museum of Modern Art. Josh Harris, a fellow co-founder who had unsuccessfully pushed Black to quit immediately, said yesterday that he was stepping back from Apollo after failing to become the next C.E.O.; Marc Rowan, Apollo’s third co-founder and Black’s pick as successor, now leads the firm.
When the details of meetings between Epstein and Bill Gates burst into public view in late 2019, the billionaire’s wife, Melinda French Gates, hired divorce lawyers. The couple’s split, announced this month, could upend their numerous investments and philanthropic ventures
Les Wexner announced last February that he would step down as C.E.O. of the Victoria’s Secret parent company L Brands, under pressure from multiple internal investigations about his close ties to Epstein. Earlier this year, he and his wife, Abigail Wexner, said they would not stand for re-election to the L Brands board this month. (The company is now in the process of spinning off Victoria’s Secret.) Mr. Wexner was Epstein’s biggest early client and, a Times investigation found, the original source of the financier’s wealth.
Prince Andrew of Britain gave up his public duties last November, days after a disastrous interview with the BBC centered on his relationship with Epstein. At least 47 charities and nonprofits of which he was a patron have since cut ties to the prince.
Joi Ito resigned as the director of the M.I.T. Media Lab, a prominent research group, in 2019 and as member of several corporate boards (including The New York Times Co.), after acknowledging that he had received $1.7 million in investments from Epstein.
Alexander Acosta resigned as Donald Trump’s labor secretary in 2019, amid criticism of his handling of a 2008 sex crimes case against Epstein when he was a federal prosecutor in Miami.
HERE’S WHAT’S HAPPENING
Morgan Stanley sets up its C.E.O. succession competition. The Wall Street firm gave new roles to four top executives, marking them as candidates to take over from James Gorman: Ted Pick and Andy Saperstein were named co-presidents; Jonathan Pruzan was named C.O.O.; and Dan Simkowitz was named co-head of strategy with Pick.
The U.S. endorses a global minimum tax of at least 15 percent. The proposal, which was lower than some had expected, is closely tied to the Biden administration’s plans to raise the corporate tax rate. Global coordination would discourage multinationals from shifting to tax havens overseas.
Treasury officials said they could capture at least $700 billion in additional revenue. That would involve hiring 5,000 new I.R.S. agents, imposing new rules on reporting crypto transactions and other measures.
U.S. customs officials block a Uniqlo shipment over Chinese forced labor concerns. Agents at the Port of Los Angeles acted under an order prohibiting imports of cotton items produced in the Xinjiang region.
U.S. steel prices are soaring. After years of job losses and mill closures, American steel producers have enjoyed a reversal of fortune: Nucor, for instance, is the year’s top-performing stock in the S&P 500. Credit goes to industry consolidation, a recovering economy and Trump-era tariffs. Unsurprisingly, steel consumers aren’t thrilled about it.
Oprah Winfrey to Blackstone, made its stock market debut yesterday, ending its first trading session with a valuation of about $13 billion. DealBook spoke with Oatly’s C.E.O., Toni Petersson, about the I.P.O. and what’s next for the company.
resignation letter offering both praise of SoftBank’s chief, Masa Son — and unusually pointed criticism of the company’s corporate governance.
Going out vs. staying in, charted
It’s been a while since we checked in on an alternative indicator of pandemic economic activity: the share price ratio of Clorox to Dave & Buster’s.
Wait, what? Nick Mazing, the director of research at the data provider Sentieo, came up with that metric to gauge the openness of the economy. The higher Clorox’s share price rises relative to Dave & Buster’s, the more people appear to be staying home and disinfecting everything than going out to crowded bars. By this measure, conditions have nearly returned to prepandemic levels — indeed, Dave & Buster’s recently lifted its sales forecast, as nearly all of its beer-and-arcade bars have reopened.
packed concert schedule, selling tickets to people who may have already binge-watched all of “Below Deck.” The second, however, suggests that people aren’t as eager to get back to huffing and puffing at the gym as they are content to exercise at home. As restrictions lift and people feel safer in crowds, drinking and dancing appear to be higher priorities.
new book, “Noise: A Flaw in Human Judgment,” the Princeton psychology professor and Nobel laureate Daniel Kahneman, along with co-authors Olivier Sibony and Cass Sunstein, argue that these inconsistencies have enormous and avoidable consequences. Kahneman spoke to DealBook about how to hone judgment and reduce noise.
DealBook: What is “noise” in this context?
Kahneman: It’s unwanted and unpredictable variability in judgments about the same situations. Some decisions and solutions are better than others and there are situations where everyone should be aiming at the same target.
Can you give some examples?
A basic example is the criminal justice system, which is essentially a machine for producing sentences for people convicted of crimes. The punishments should not be too different for the same crime yet sentencing turns out to depend on the judge and their mood and characteristics. Similarly, doctors looking at the same X-ray should not be reaching completely different conclusions.
How do individuals or institutions detect this noise?
You detect noise in a set of measurements and can run an experiment. Present underwriters with the same policy to evaluate and see what they say. You don’t want a price so high that you don’t get the business or one so low that it represents a risk. Noise costs institutions. One underwriter’s decision about one policy will not tell you about variability. But many underwriters’ decisions about the same cases will reveal noise.
WSJ)
An arm of Goldman Sachs has raised $3 billion from clients to invest in later-stage start-ups. (WSJ)
SPACs have raised $100 billion this year through May 19, a record, but new fund listings dropped sharply last month. (Insider)
Politics and policy
President Biden issued an executive order directing government agencies to expand efforts to analyze and mitigate the economic risks tied to climate change. (Axios)
“As Paycheck Protection Program Runs Dry, Desperation Grows” (NYT)
CNN said the prime-time host Chris Cuomo inappropriately advised his brother, Gov. Andrew Cuomo of New York, on how to respond to sexual harassment allegations. (NYT)
Tech
Paul Romer was one of the tech industry’s favorite economists; now he is criticizing Silicon Valley giants for being too big. (NYT)
Amazon was recently pushed to ban prominent electronics accessory makers by the F.T.C. over fake-review schemes. (Recode)
Best of the rest
Bill Gates and Warren Buffett got more than 200 billionaires to pledge half their wealth to charity. Some are falling short, but still getting massive tax breaks. (Insider)
FIFA, the global soccer governing body, secretly considered supporting the European Super League, before reconsidering amid public outcry about the now-failed competition. (NYT)
Five questions to ask before you panic about inflation. (NYT)
We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com.
WASHINGTON — President Biden has repeatedly pledged to work with China on issues like climate change while challenging Beijing on human rights and unfair trade practices.
But those goals are now coming into conflict in the global solar sector, presenting the Biden administration with a tough choice as it looks to expand the use of solar power domestically to reduce the United States’ carbon dioxide emissions.
The dilemma stems from an uncomfortable reality: China dominates the global supply chain for solar power, producing the vast majority of the materials and parts for solar panels that the United States relies on for clean energy. And there is emerging evidence that some of China’s biggest solar companies have worked with the Chinese government to absorb minority workers in the far western region of Xinjiang, programs often seen as a red flag for potential forced labor and human rights abuses.
This week, Mr. Biden is inviting world leaders to a climate summit in Washington, where he is expected to unveil an ambitious plan for cutting America’s emissions over the next decade. The administration is already eyeing a goal of generating 100 percent of the nation’s electricity from carbon-free sources such as solar, wind or nuclear power by 2035, up from only 40 percent last year. To meet that target, the United States may need to more than double its annual pace of solar installations.
many of which are imported from Chinese-owned factories in Vietnam, Malaysia and Thailand.
China also supplies many of the key components in solar panels, including more than 80 percent of the world’s polysilicon, a raw material that most solar panels use to absorb energy from sunlight. Nearly half of the global supply comes from Xinjiang alone. In 2019, less than 5 percent of the world’s polysilicon came from U.S.-owned companies.
“It’s put the Democrats in a hard position,” said Francine Sullivan, the vice president for business development at REC Silicon, a polysilicon maker based in Norway with factories in the United States. “Do you want to stand up to human rights in China, or do you want cheap solar panels?”
The administration is increasingly under pressure from influential supporters not to turn a blind eye to potential human rights abuses in order to achieve its climate goals.
“As the U.S. seeks to address climate change, we must not allow the Chinese Communist Party to use forced labor to meet our nation’s needs,” Richard L. Trumka, the president of the A.F.L.-C.I.O., wrote in a letter on March 12 urging the Biden administration to block imports of solar products containing polysilicon from the Xinjiang region.
Xinjiang is now notorious as the site of a vast program of detention and surveillance that the Chinese government has carried out against Muslim Uyghurs and other minority groups. Human rights groups say the Chinese authorities may have detained a million or more minorities in camps and other sites where they face torture, indoctrination and coerced labor.
In a report last year, Horizon Advisory, a consultancy in Washington, cited Chinese news reports and government announcements suggesting that major Chinese solar companies including GCL-Poly, East Hope Group, Daqo New Energy, Xinte Energy and Jinko Solar had accepted workers transferred with the help of the Chinese government from impoverished parts of Xinjiang.
Jinko Solar denied those allegations, as did the Chinese government. Zhang Longgen, a vice chairman of Xinjiang Daqo — a unit of one of the companies cited by Horizon Advisory — said that the polysilicon plants were not labor intensive, and that the company’s workers were freely employed and could quit if they wanted, according to Global Times, a Chinese Communist Party-owned newspaper. The report said that only 18 of the 1,934 workers at Xinjiang Daqo belonged to ethnic minorities, and that none were Uyghur.
a sweeping ban on cotton and tomatoes from the region. Those restrictions have forced a reorganization of global supply chains, especially in the apparel sector.
The Biden administration has said it is still reviewing the Trump administration’s policies, and it has not yet signaled whether it will pursue other bans on products or companies. But both Mr. Biden and his advisers have insisted that the United States plans to confront China on human rights abuses in Xinjiang.
A spokeswoman for the National Security Council said that the draconian treatment of Uyghurs “cannot be ignored,” and that the administration was “studying ways to effectively ensure that we are not importing products made from forced labor,” including solar products.
a pledge of 236 companies to oppose forced labor and encouraged companies to sever any ties with Xinjiang by June.
Some Chinese companies have responded by reshuffling their supply chains, funneling polysilicon and other solar products they manufacture outside Xinjiang to American buyers, and then directing their Xinjiang-made products to China and other markets.
Analysts say this kind of reorganization is, in theory, feasible. About 35 percent of the world’s polysilicon comes from regions in China other than Xinjiang, while the United States and the European Union together make up around 30 percent of global solar panel demand, according to Johannes Bernreuter, a polysilicon market analyst at Bernreuter Research.
John Smirnow, the general counsel for the Solar Energy Industries Association, said most solar companies were already well on their way toward extricating supply chains from Xinjiang.
also been reported in Chinese facilities outside Xinjiang where Uyghurs and other minorities have been transferred to work. And restrictions on products from Xinjiang could spread to markets including Canada, Britain and Australia, which are debating new rules and guidelines.
Human rights advocates have argued that allowing Chinese companies to cleave their supply chains to serve American and non-American buyers may do little to improve conditions in Xinjiang and have pressed the Biden administration for stronger action.
“The message has to be clear to the Chinese government that this economic model is not going to be supported by governments or businesses,” said Cathy Feingold, the director of the A.F.L.-C.I.O.’s International Department.
Chinese companies are also facing pressure from Beijing not to accede to American demands, since that could be seen as a tacit criticism of the government’s activities in Xinjiang.
In a statement in January, the China Photovoltaic Industry Association and China Nonferrous Metals Industry Association condemned “irresponsible statements” from U.S. industries, which they said were directed at curbing Xinjiang’s development and “meddling in Chinese domestic affairs.”
“It is widely known that the ‘forced labor’ issue is in its entirety the lie of the century that the United States and certain other Western countries have concocted from nothing,” they said.
mothballed a new $1.2 billion facility in Tennessee in 2014, while REC Silicon shut its polysilicon facility in Washington in 2019.
China has promised to carry out large purchases of American polysilicon as part of a trade deal signed last year, but those transactions have not materialized.
In the near term, tensions over Xinjiang could be a boon for the few remaining U.S. suppliers. Ms. Sullivan said some small U.S. solar developers had reached out to REC Silicon in recent months to inquire about non-Chinese products.
But American companies need the promise of reliable, long-term orders to scale up, she said, adding that when she explains the limited supply of solar products that do not touch China, people become “visibly ill.”
“This is the big lesson,” Ms. Sullivan added. “You become dependent on China, and what does it mean? We have to swallow our values in order to do solar.”
U.S.-China tensions, human rights and business are once again meeting uncomfortably on the basketball court.
In China, local brands are prospering from a consumer backlash against Nike, H&M and other foreign brands over their refusal to use Chinese cotton made by forced labor. Chinese brands have publicly embraced the cotton from the Xinjiang region, leading to big sales to patriotic shoppers and praise from the Beijing-controlled media.
In the United States, two of those same Chinese brands, Li-Ning and Anta, adorn the feet of N.B.A. players — and those players are being rewarded handsomely for it. Two players reached endorsement deals with Anta in February. Another signed on this week. Klay Thompson of the Golden State Warriors already had a shoe deal with Anta that has been widely reported to be valued at up to $80 million.
Dwyane Wade, the three-time N.B.A. champion and retired Miami Heat player, has a clothing line with Li-Ning that is so successful he has recruited young players for the brand.
online, however.) Still, their full-throated support of Xinjiang could have reputational consequences for the American athletes.
once said he wanted to be the Michael Jordan of Anta. His teammate James Wiseman, as well as Alex Caruso of the Los Angeles Lakers, signed with Anta earlier this year, according to the sportswear brand’s social media account. Precious Achiuwa of the Heat announced this week that he was joining Anta.
Requests for comment from Mr. Thompson and other N.B.A. players also went unanswered.
Outside China, Xinjiang has become synonymous with repression. Reports suggest as many as one million Uyghurs and other largely Muslim ethnic minorities have been held in detention camps. In March, Secretary of State Antony J. Blinken accused China of continuing to “commit genocide and crimes against humanity” in the far northwestern region.
voiced his support for the Hong Kong protests on Twitter in 2019, Li-Ning and Shanghai Pudong Development Bank Credit Card Center paused their partnerships with the team. The Chinese Basketball Association, whose president is the former Rockets player Yao Ming, also suspended its cooperation with the Rockets.
quickly denied. But the incident left a scar on the N.B.A.’s reputation for supporting free speech and severely limited its access to the Chinese market.
China Central Television, the state-run television network, stopped broadcasting N.B.A. games after Mr. Morey’s message on Twitter. Late last year, it briefly resumed coverage for Games 5 and 6 of the N.B.A. finals. A week later, Mr. Morey stepped down as general manager.
In a radio interview this week, Mr. Silver said that CCTV had stopped airing N.B.A. games again, but that fans could stream them through Tencent, the Chinese internet conglomerate. He said that the N.B.A.’s partnership with China was “complicated,” but that “doesn’t mean we don’t speak up about what we see are, you know, things in China that are inconsistent with our values.”
A spokesman for the league declined to comment for this article.
Money and a large China fan base are at stake for players like Mr. Thompson and the dozens of other American athletes who have been heavily promoted by Anta and Li-Ning. Mr. Thompson has had a partnership with Anta since 2014 that has given him a popular shoe line and sponsored tours in China.
More recent deals between the companies and N.B.A. players could face questions in coming weeks as tensions between the United States and China escalate. Jimmy Butler, a five-time all-star who plays for the Heat, and the Toronto Raptors guard Fred VanVleet signed on with Li-Ning in November. Mr. Wade, the retired Heat player, helped CJ McCollum and D’Angelo Russell, two star guards, secure deals with Li-Ning through his sportswear line.
“My decision 7 years ago to sign with Li-Ning was to show the next generation that it’s not just one way of doing things,” Mr. Wade wrote on Twitter when he announced Mr. Russell’s contract in November 2019. “I had a chance to build a Global platform that gives future athletes a canvas to create and be expressive.”
Sopan Deb contributed reporting from New York, and Cao Li from Hong Kong.
SHANGHAI — To defend against accusations by Washington and others that it doesn’t play fair on trade, Beijing could point to the banks. Chinese leaders have been steadily lowering the barriers they had erected around the country’s vast financial system, giving Wall Street and European lenders a greater shot at winning business in the world’s second-largest economy.
Now the walls are going up again.
New Chinese rules have sharply limited the ability of foreign banks to do business there, making them less competitive against local rivals, according to three people with knowledge of the directives. One set of rules enacted in December and January restricts how much money foreign banks can transfer into China from overseas. Another that took effect on Wednesday required many foreign banks to make fewer loans and sell off bonds and other investments, two of the people said.
The new rules have caused a stir among the global bank executives and foreign companies in China that depend on those lenders for money, the people said. Among other concerns, they worry that the rules could make foreign-owned businesses more dependent on China’s state-run banking system for the money they need to grow. That dependence could give Beijing another potential pressure point to use as it squares off against Washington and others over trade, human rights, geopolitics and other sticky issues.
Banks and trade groups have been reluctant to speak publicly for fear of triggering further regulatory measures. But in a January letter to China’s central bank that was reviewed by The New York Times, the European Union Chamber of Commerce in China raised concerns about the money transfer limits.
encouraged boycotts of foreign businesses like H&M, the Swedish retailer, and Nike, the American athletic brand, after they vowed not to use cotton made by forced labor in Xinjiang.
The reasons behind China’s new banking rules aren’t clear, though they appear to have little to do with the tense political environment. They seem to be aimed instead at stemming big, potentially disruptive flows of money into the country.
surpassed the United States last year by taking in $163 billion worth of direct investments in factories, office buildings, companies and other assets.
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Big money flows into a country can also make its currency rise in value — and China appears to working hard to counter that.
China’s currency, the renminbi, rose sharply in value against the U.S. dollar in the second half of last year. In May, $1 was worth about 7.15 renminbi. By year’s end, $1 bought about 6.5 renminbi. That rise was bad news for China’s exporters because it made their goods less competitive overseas.
But since the Chinese government enacted its new banking rules, the currency has begun to weaken. It now stands at about 6.6 renminbi to the dollar.
The new rules alone aren’t likely significant enough to account for the sudden halt to the renminbi’s rise. But they join other moves made by the Chinese government in recent months that have made moving money into China slightly harder and moving it out slightly easier. Combined, they could put pressure on the renminbi to weaken.
“This has started since last October, and they are all on the same side,” said Michael Pettis, a finance professor at Peking University.
Outside factors have likely contributed to the renminbi’s shift, including the resurgence of the U.S. economy, which could lead investors to steer their money there instead.
Chinese officials have stressed in recent months that their country is open to foreign investment, particularly banking.
“The inflow of foreign capital is inevitable, but so far, the scale and speed are still within our control,” Guo Shuqing, the chairman of the China Banking and Insurance Regulatory Commission, which has worked closely with the central bank on the new policies, said during a news conference on March 2. “We continue to encourage foreign financial institutions to enter China for shared development.”
In an unsuccessful attempt to head off a trade war with the Trump administration, China gradually relaxed or removed limits on foreign banks, insurers and money management firms. Big banks responded by expanding their mainland operations, including Citigroup, Credit Suisse, Goldman Sachs, HSBC, J.P. Morgan Chase, Morgan Stanley and UBS.
The global financial environment has encouraged money flows into China. With near zero interest rates elsewhere, international banks borrowed cheaply abroad. Until the new rules kicked in, they could send that money to China and lend or invest it there, reaping higher returns.
The first of the new rules, issued in a memo to banks in December, appeared to be aimed at that trend. That rule limited the ability of global banks to raise money overseas and move it into China. The rule is being phased in through November but was written in a way that has already had a big effect on financial contracts involving bets on the renminbi’s direction, said the people familiar with the notice.
Another measure communicated directly by Chinese regulators to foreign banks three weeks ago concerned the size of bank balance sheets, two of the people said.
Concerned about the rapid growth of credit in the Chinese economy, regulators ordered domestic and foreign banks to limit their balance sheets by Wednesday night to show only slight growth from last year. Because China has recently loosened limits on foreign purchases of bonds, many foreign banks had been buying more bonds for sale to foreign customers, expanding their balance sheets.
The full impact of the new rules will depend on how long they stay in place. Eswar Prasad, a Cornell University economist, predicted that China would eventually resume opening up to foreign financial institutions.
“They don’t want to scare off foreign investors in the medium to long term,” he said.
When the Swedish fast-fashion giant H&M said in September that it was ending its relationship with a Chinese supplier accused of using forced labor, a few Chinese social media accounts dedicated to the textile industry took note. But by and large, the moment passed without fanfare.
Half a year later, Beijing’s online outrage machine sprang into action. This time, its wrath was unsparing.
The Communist Party’s youth wing denounced H&M on social media and posted an archival photo of slaves on a Mississippi cotton plantation. Official news outlets piled on with their own indignant memes and hashtags. Patriotic web users carried the message across far and varied corners of the Chinese internet.
Within hours, a tsunami of nationalist fury was crashing down upon H&M, Nike, Uniqlo and other international clothing brands, becoming the latest eruption over China’s policies in its western region of Xinjiang, a major cotton producer.
sanctions imposed on Chinese officials last week by the United States, the European Union, Britain and Canada in connection to Xinjiang. China has placed hundreds of thousands of the region’s Uyghurs and other ethnic minorities in indoctrination camps and used harsh methods to push them into jobs with factories and other employers.
“The hate-fest part is not sophisticated; it’s the same logic they’ve followed going back decades,” said Xiao Qiang, a research scientist at the School of Information at the University of California, Berkeley, and the founder of China Digital Times, a website that tracks Chinese internet controls. But “their ability to control it is getting better,” he said.
“They know how to light up those ultra-pro-government, nationalist users,” Mr. Xiao continued. “They’re getting very good at it. They know exactly what to do.”
rejected the notion that Beijing had led the boycott campaign against H&M and the other brands.
“These foreign companies refuse to use Xinjiang cotton purely on the basis of lies,” Mr. Zhao said at a news briefing. “Of course this will trigger the Chinese people’s dislike and anger. Does the government even need to incite and guide this?”
After the Communist Youth League ignited the outrage on Wednesday, other government-backed groups and state news outlets fanned the flames.
They posted memes proposing new meanings behind the letters H and M: mian hua (cotton), huang miu (ridiculous), mo hei (smears). The official Xinhua news agency posted an illustration depicting the Better Cotton Initiative, a group that had expressed concerns about forced labor in Xinjiang, as a blindfolded puppet controlled by two hands that were patterned like an American flag.
The buzz quickly drew notice at Beijing’s highest levels. On Thursday, a Foreign Ministry spokeswoman held up a photo of slaves in American cotton fields during a news briefing.
shared a clip showing a worker removing an H&M sign from a mall. A user in Beijing who posts about television stars highlighted entertainers who had ended their contracts with Adidas and other targeted brands.
“Today’s China is not one that just anyone can bully!” he wrote to his nearly seven million followers. “We do not ask for trouble, but we are not afraid of trouble either.”
A fashion influencer named Wei Ya held a live video event on Friday hawking products made with Xinjiang cotton. In her Weibo post announcing the event, she made sure to tag the Communist Youth League.
By Monday, news sites were circulating a rap video that combined the cotton issue with some popular recent lines of attack on Western powers: “How can a country where 500,000 have died of Covid-19 claim the high ground?”
One Weibo user posted a lushly animated video that he said he had worked through the night to make. It shows white-hooded men pointing guns at Black cotton pickers and ends with a lynching.
“These are your foolish acts; we would never,” a caption reads.
Less than two hours after the user shared the video, it was reposted by Global Times, a party-controlled newspaper known for its nationalist tone.
Many web users who speak up during such campaigns are motivated by genuine patriotism, even if China’s government does pay some people to post party-line comments. Others, such as the traffic-hungry blog accounts derided in China as “marketing accounts,” are probably more pragmatic. They just want the clicks.
tests conducted by China Digital Times, internet platforms have been diligently controlling search results and comments related to Xinjiang and H&M since last week.
An article in Global Times urged readers to “resolutely criticize those like H&M that make deliberate provocations, but at the same time, stay rational and beware of pretend patriots joining the crowd to stir up hatred.”
The Communist Youth League has been at the forefront of optimizing party messages for viral engagement. Its influence is growing as more voices in society look for ways to show loyalty to Beijing, said Fang Kecheng, an assistant professor in the School of Journalism and Communications at the Chinese University of Hong Kong.
apologized for the “bad impact” her post had made.
“Don’t just support Xinjiang cotton, support Xinjiang people too!” another Weibo user wrote. “Support Xinjiang people walking the streets and not having their phone and ID checked.”
The post later vanished. Its author declined to comment, citing concerns for his safety. Weibo did not respond to a request for comment.
Last week, calls for the cancellation of H&M and other Western brands went out across Chinese social media as human rights campaigns collided with cotton sourcing and political gamesmanship. Here’s what you need to know about what’s going on and how it may affect everything from your T-shirts to your trench coats.
What’s all this I’m hearing about fashion brands and China? Did someone make another dumb racist ad?
No, it’s much more complicated than an offensive and obvious cultural faux pas. The issue centers on the Xinjiang region of China and allegations of forced labor in the cotton industry — allegations denied by the Chinese government. Last summer, many Western brands issued statements expressing concerns about human rights in their supply chain. Some even cut ties with the region all together.
Now, months later, the chickens are coming home to roost: Chinese netizens are reacting with fury, charging the allegations are an offense to the state. Leading Chinese e-commerce platforms have kicked major international labels off their sites, and a slew of celebrities have denounced their former foreign employers.
growing political and economic implications. On the one hand, as the pandemic continues to roil global retail, consumers have become more attuned to who makes their clothes and how they are treated, putting pressure on brands to put their values where their products are. One the other, China has become an evermore important sales hub to the fashion industry, given its scale and the fact that there is less disruption there than in other key markets, like Europe. Then, too, international politicians are getting in on the act, imposing bans and sanctions. Fashion has become a diplomatic football.
This is a perfect case study of what happens when market imperatives come up against global morality.
Tell me more about Xinjiang and why it is so important.
Xinjiang is a region in northwest China that happens to produce about a fifth of the world’s cotton. It is home to many ethnic groups, especially the Uyghurs, a Muslim minority. Though it is officially the largest of China’s five autonomous regions, which in theory means it has more legislative self-control, the central government has been increasingly involved in the area, saying it must exert its authority because of local conflicts with the Han Chinese (the ethnic majority) who have been moving into the region. This has resulted in draconian restrictions, surveillance, criminal prosecutions and forced-labor camps.
OK, and what about the Uyghurs?
A predominantly Muslim Turkic group, the Uyghur population within Xinjiang numbers just over 12 million, according to official figures released by Chinese authorities. As many as one million Uyghurs and other Muslim minorities have been retrained to become model workers, obedient to the Chinese Communist Party via coercive labor programs.
The New York Times, The Wall Street Journal, Axios and others published reports that connected Uyghurs in forced detention to the supply chains of many of the world’s best-known fashion retailers, including Adidas, Lacoste, H&M, Ralph Lauren and the PVH Corporation, which owns Calvin Klein and Tommy Hilfiger, many of those brands reassessed their relationships with Xinjiang-based cotton suppliers.
banned all imports of cotton from the region, as well as products made from the material and declared what was happening “genocide.” At the time, the Workers Rights Consortium estimated that material from Xinjiang was involved in more than 1.5 billion garments imported annually by American brands and retailers.
That’s a lot! How do I know if I am wearing a garment made from Xinjiang cotton?
You don’t. The supply chain is so convoluted and subcontracting so common that often it’s hard for brands themselves to know exactly where and how every component of their garments is made.
So if this has been an issue for over a year, why is everyone in China freaking out now?
It isn’t immediately clear. One theory is that it is because of the ramp-up in political brinkmanship between China and the West. On March 22, Britain, Canada, the European Union and the United States announced sanctions on Chinese officials in an escalating row over the treatment of Uyghurs in Xinjiang.
Not long after, screenshots from a statement posted in September 2020 by H&M citing “deep concerns” about reports of forced labor in Xinjiang, and confirming that the retailer had stopped buying cotton from growers in the region, began circulating on Chinese social media. The fallout was fast and furious. There were calls for a boycott, and H&M products were soon missing from China’s most popular e-commerce platforms, Alibaba Group’s Tmall and JD.com. The furor was stoked by comments on the microblogging site Sina Weibo from groups like the Communist Youth League, an influential Communist Party organization.
Within hours, other big Western brands like Nike and Burberry began trending for the same reason.
And it’s not just consumers who are up in arms: Influencers and celebrities have also been severing ties with the brands. Even video games are bouncing virtual “looks” created by Burberry from their platforms.
one second (there were 100 made). That’s why H&M worked with Victoria Song, Nike with Wang Yibo and Burberry with Zhou Dongyu.
But Chinese influencers and celebrities are also sensitive to pleasing the central government and publicly affirming their national values, often performatively choosing their country over contracts.
In 2019, for example, Yang Mi, the Chinese actress and a Versace ambassador, publicly repudiated the brand when it made the mistake of creating a T-shirt that listed Hong Kong and Macau as independent countries, seeming to dismiss the “One China” policy and the central government’s sovereignty. Not long afterward, Coach was targeted after making a similar mistake, creating a tee that named Hong Kong and Taiwan separately; Liu Wen, the Chinese supermodel, immediately distanced herself from the brand.
Tencent removed two Burberry-designed “skins” — outfits worn by video game characters that the brand had introduced with great fanfare — from its popular title Honor of Kings as a response to news that the brand had stopped buying cotton produced in the Xinjiang region. The looks had been available for less than a week.
So this is hitting both fast fashion and the high end. How much of the fashion world is involved?
Potentially, most of it. So far Adidas, Nike, Converse and Burberry have all been swept up in the crisis. Even before the ban, additional companies like Patagonia, PVH, Marks & Spencer and the Gap had announced that they did not source material from Xinjiang and had officially taken a stance against human rights abuses.
removed their policies against forced labor from their websites.
That seems squirrelly. Is this likely to escalate?
Brands seem to be concerned that the answer is yes, since, apparently fearful of offending the Chinese government, some companies have proactively announced that they will continue buying cotton from Xinjiang. Hugo Boss, the German company whose suiting is a de facto uniform for the financial world, posted a statement on Weibo saying, “We will continue to purchase and support Xinjiang cotton” (even though last fall the company had announced it was no longer sourcing from the region). Muji, the Japanese brand, is also proudly touting its use of Xinjiang cotton on its Chinese websites, as is Uniqlo.
Wait … I get playing possum, but why would a company publicly pledge its allegiance to Xinjiang cotton?
It’s about the Benjamins, buddy. According to a report from Bain & Company released last December, China is expected to be the world’s largest luxury market by 2025. Last year it was the only part of the world to report year on year growth, with the luxury market reaching 44 billion euros ($52.2 billion).
Is anyone going to come out of this well?
One set of winners could be the Chinese fashion industry, which has long played second fiddle to Western brands, to the frustration of many businesses there. Shares in Chinese apparel groups and textile companies with ties to Xinjiang rallied this week as the backlash gained pace. And more than 20 Chinese brands publicly made statements touting their support for Chinese cotton.
