The China Memo

The China Memo
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Welcome to The China Memo. I'm your host: born in China, trained in Western finance, now based in Switzerland. I read what Chinese policymakers, companies, and business people actually say — from a local perspective — and translate it for those tracking China who want the signal without noise. Fact-based. No speculation. We focus on structural trends. Disclaimer: All contents are for educational and informational purposes only. Nothing here constitutes financial, investment, or professional advice.

Episodes

  1. MAY 11

    10. DeepSeek and China's AI Moment

    In January 2025, DeepSeek R1 — a reasoning model from a Chinese quant hedge fund spin-off — topped global app store charts, rattled US tech stocks, and was immediately labelled China's "AI Sputnik moment." This episode interrogates that framing from both sides. The steel-man of the sceptical case is genuine: DeepSeek trained on American chips, the six-million-dollar cost figure is a single training run, and open-weight release is not a market position. But the counter-narrative — that export controls are holding and the gap is intact — is also insufficient. DeepSeek's Mixture-of-Experts architecture emerged in part from hardware constraint, and may be more durable under future compute restriction than the brute-force approach it competed against. Three markers to watch: whether the efficiency advantage holds across model generations, the hardware trajectory as Chinese labs respond to chip restrictions, and whether the hedge-fund-backed research-first organisational model gets replicated. REFERENCES Wikipedia — "DeepSeek." https://en.wikipedia.org/wiki/DeepSeekNew York Times — "DeepSeek Owner, China AI." https://www.nytimes.com/2025/01/28/business/deepseek-owner-china-ai.htmlWired — "DeepSeek China Model AI." https://www.wired.com/story/deepseek-china-model-ai/The Guardian — "Who Is Behind DeepSeek and How Did It Achieve Its AI Sputnik Moment." https://www.theguardian.com/technology/2025/jan/28/who-is-behind-deepseek-and-how-did-it-achieve-its-ai-sputnik-moment/BBC — "DeepSeek AI." https://www.bbc.com/news/articles/c5yv5976z9poTechCrunch — "DeepSeek Gets Silicon Valley Talking." https://techcrunch.com/2025/01/26/deepseek-gets-silicon-valley-talking/CNN — "China DeepSeek AI Success." https://www.cnn.com/2025/01/28/china/china-deepseek-ai-success-tech-intl-hnkFuseAI Tools — "History of DeepSeek AI." https://www.fuseaitools.com/news/history-of-deepseek-aiIssarice — "Timeline of DeepSeek." https://timelines.issarice.com/wiki/Timeline_of_DeepSeekOurChinaStory — "What's the Story of DeepSeek and Its Founder Liang Wenfeng." https://www.ourchinastory.com/en/14046/What's-the-story-of-DeepSeek-and-its-founder-Liang-Wenfeng

    19 min

  2. MAY 2

    09. BYD: From Battery Maker to World's Largest EV Company

    The standard critique of BYD is straightforward: at least 3.7 billion dollars in documented government support, a protected domestic market, and government-steered early customers in bus fleets and taxi programmes. This episode takes that argument seriously — and then shows where it stops being sufficient. By mid-2024, BYD held 23 percent of the global EV market, more than double Tesla's share, across over 100 countries, built on a battery architecture competitors are still trying to replicate. The policy frame has reached its explanatory limit. The pivot point is the Blade Battery: a cell-to-pack design that improves space utilisation by roughly 50 percent, lowers cost per kilowatt-hour, and substantially reduces fire risk. That's the output of 25 years of battery chemistry development — not a subsidy programme. We close with three markers to watch: whether overseas factories in Hungary, Thailand, and Brazil reach genuine production scale; whether Blade technology gets adopted by non-BYD manufacturers; and whether BYD's profitability holds as it moves into markets where brand, software, and after-sales service matter differently than in fleet procurement. REFERENCES CKGSB Knowledge — "How China's BYD Grew Into an EV Business Giant." https://english.ckgsb.edu.cn/knowledge/professor_analysis/how-china-byd-grew-into-an-ev-business-giant/Drivetech Partners — "BYD and CAR Inc: Powering China's Green Mobility." https://drivetech.partners/360/byd_and_car_inc_powering_chinas_green_mobilityTridens Technology — "BYD Sales Statistics." https://tridenstechnology.com/byd-sales-statistics/Autovista24 — "BYD Enjoys Significant Lead in Global EV Market." https://autovista24.autovistagroup.com/news/byd-enjoys-significant-lead-in-global-ev-market/Electrek — "China Gave BYD an Incredible $3.7 Billion to Win the EV Race." https://electrek.co/2024/04/12/china-gave-byd-an-incredible-3-7-billion-to-win-the-ev-race/Nomad Semi — "BYD Semiconductor Deep Dive." https://www.nomadsemi.com/p/byd-semiconductor-deep-diveBYD EU Blog — "BYD's Revolutionary Blade Battery — All You Need to Know." https://www.byd.com/eu/blog/BYDs-revolutionary-Blade-Battery-all-you-need-to-knowBYD Auto Belgium — "Blade Battery." https://www.bydauto.be/en/blade-battery/Ufine Battery — "BYD Blade Battery Comprehensive Guide." https://www.ufinebattery.com/blog/byd-blade-battery-comprehensive-guide/Atlantic Council — "What China's BYD Really Wants from EV Investments in Mexico." https://www.atlanticcouncil.org/blogs/energysource/what-chinas-byd-really-wants-from-ev-investments-in-mexico/Forbes — "Top 5 Trends to Watch in Chinese Energy During 2026." https://www.forbes.com/sites/wesleyhill/2026/01/05/top-5-trends-to-watch-in-chinese-energy-during-2026/Carbon Credits — "BYD's Billion Dollar Surge: Dominating EV Sales." https://carboncredits.com/byds-billion-dollar-surge-dominating-ev-sales-and-driving-the-green-revolution/

    22 min

  3. APR 28

    08. China's Rare Earths: Chokepoint or Overstated Risk?

    Half of the world's rare earth reserves sit outside China's borders. Almost none of the industrial capacity to process them does. That gap — between where the ore is found and where it gets turned into something a factory can actually use — is the case file this episode is built around. China holds roughly 50 percent of global reserves, but around 90 percent of global processing, 91 percent of separation capacity, and 94 percent of the permanent magnets that go into EV motors and wind turbines. For heavy rare earths like dysprosium and terbium, the share of Chinese separation capacity approaches 99 percent. The chokepoint is not geological — it's industrial and chemical, built over three decades of state investment, and it sits in the midstream, not the mine. The episode weighs two competing readings: permanent structural chokepoint versus transitional industrial lead that erodes with enough capital and time. The evidence currently favours the first. Closing the non-Chinese processing gap is estimated to require over 100 billion dollars in capital by 2035 — against roughly 5 billion currently committed. Meanwhile, China's export-control architecture has been expanding steadily since 2023, growing more granular and extraterritorial with each iteration, explicitly mirroring the logic of US semiconductor restrictions. The October 2025 rules extended Chinese licensing jurisdiction to foreign manufacturers using Chinese refining technology — meaning supply-chain diversification may not mean what companies think it means. We close with four things that would genuinely move the needle, including the November 2026 expiry of a partial suspension agreed ahead of the Trump-Xi summit, and what to watch in non-Chinese midstream investment pipelines. REFERENCES China Tungsten Industry Association (CTIA) — "World Rare Earth Reserves Data." https://www.ctia.com.cn/en/news/37559.htmlCEIC Data — "China's Dominance of the Rare Earths Industry." https://info.ceicdata.com/ceic-article-chinas-dominance-of-the-rare-earths-industryMining Technology — "China Global Rare Earth Production." https://www.mining-technology.com/analyst-comment/china-global-rare-earth-production/Wikipedia — "Rare-earth industry in China." https://en.wikipedia.org/wiki/Rare-earth_industry_in_ChinaDiscovery Alert / LinkedIn — Rare Earth Processing Analysis. https://www.linkedin.com/posts/discovery-alert-australia_china-controls-85-90-of-global-rare-earth-activity-7412325569192710144-J_eFInvestingNews — "Rare Earth Metal Production." https://investingnews.com/daily/resource-investing/critical-metals-investing/rare-earth-investing/rare-earth-metal-production/Gulf News — "World's Rare Earth Giants: Top 10 Countries with the Biggest Reserves." https://gulfnews.com/business/energy/worlds-rare-earth-giants-top-10-countries-with-the-biggest-reserves-1.500467937Global Trade Alert — "Chinese Export Controls on Critical Raw Materials." https://globaltradealert.org/blog/chinese-export-controls-on-critical-raw-materials-inventorySkillings Mining Review — "China's Export Controls: What's Next for Rare Earths, Gallium and Germanium." https://skillings.net/chinas-export-controls-whats-next-for-rare-earths-gallium-and-germanium-supply-chains/CSIS — "Consequences of China's New Rare Earths Export Restrictions." https://www.csis.org/analysis/consequences-chinas-new-rare-earths-export-restrictionsUS Trade Representative — "US Wins Victory in Rare Earths Dispute with China." https://ustr.gov/about-us/policy-offices/press-office/press-releases/2014/March/US-wins-victory-in-rare-earths-dispute-with-ChinaUSGS — Mineral Commodity Summaries, Rare Earths. https://pubs.usgs.gov/periodicals/mcs2025/mcs2025-rare-earths.pdf

    21 min

  4. APR 26

    07. Three Winners, Three Playbooks: Inside China's Auto Giants

    Three Chinese automakers now produce or sell more than three million vehicles a year each — putting BYD, Geely, and SAIC in the same conversation as Volkswagen and Toyota on scale. But they got there through fundamentally different architectures, and those differences matter far more than the headline number. BYD owns roughly seventy-five percent of its components in-house — batteries, chips, motors, software — making it closer to a vertically integrated manufacturer than a traditional automaker. Geely built outward through acquisitions, using Volvo, Lotus, and Proton to buy organisational capability and market access it couldn't build alone. SAIC turned decades of joint ventures with Volkswagen and GM into a springboard for its own export machine, with MG now selling in over a hundred countries under a Glocal strategy designed to produce inside tariff walls rather than export into them. This episode uses the three as a lens on what a genuinely competitive global auto model looks like under simultaneous pressure from electrification, a domestic price war, and rising trade friction. Scale is necessary but not sufficient — the qualifier is whether a company has a defensible mechanism for securing the inputs that matter: batteries, semiconductors, and manufacturing access in the right geographies. We close with three signals to watch: where new plants get announced and what ownership structure they carry, which badges gain sustained traction in Europe and North America versus the Global South, and how governments respond not just with tariffs but with content requirements and security reviews that increasingly determine who can sell to fleet and public-sector buyers.

    28 min

  5. APR 19

    06. One Billion Consumers: A Deep Dive into China's Spending Story

    In 2000, roughly 1.2 billion people in China lived below the threshold where genuine discretionary spending becomes possible. By 2030, roughly the same number are expected to sit at or above it — the largest migration into the global consuming class ever recorded. Yet at this same moment, eighty percent of Chinese consumers say they are actively choosing cheaper products than before, savings rates are up, and the phrase on everyone's lips is 消费降级 — consumption downgrade. This episode works through that contradiction across the full arc: from the ration-coupon shortage economy of the pre-reform era, through the appliance boom and the property decade, to today's phase of value-seeking, deleveraging, and what Chinese researchers are calling the third consumption era. The property bust is the pivot point. With residential property representing roughly seventy percent of urban household assets, and the bulk of paper gains since 2021 now gone, the spending pullback has a structural foundation — it is a rational response to a genuine wealth shock, not a temporary mood. But running alongside that caution is something more interesting: the rise of Guochao, domestic brands chosen not just for price but for cultural identity, particularly among younger consumers in lower-tier cities who carry less debt and more optimism than their urban counterparts. The picture that emerges is not a single consumer curve but several running simultaneously in different directions — and aggregate data hides all of it.

    29 min

  6. APR 16

    05. How 2026 Is Stress-Testing China's Energy Playbook

    Two events in early 2026 together amount to the most significant stress test China's energy security strategy has faced in years. The effective closure of the Strait of Hormuz hit China's petrochemicals and industrial gas supply harder than its power grid, where domestic renewables increasingly carry the load. Meanwhile, the US-backed removal of Maduro in Venezuela didn't cut off China's oil barrels in the short term — but it placed at least ten billion dollars in Chinese state-bank loans inside a political environment designed by Washington to reduce Beijing's leverage. The headline — China facing supply disruptions from two directions at once — is not wrong, but incomplete. China's 85 percent domestic energy self-sufficiency provides a real cushion. What these events actually expose are the limits of Chinese diplomatic influence when stable governments give way to internal power struggles, and the US capacity to impose political-risk costs on Chinese overseas assets without touching commodity flows directly. Three signals to watch: how long the Hormuz closure runs, how quickly China deepens its Russia energy relationships, and how Beijing navigates the Venezuela loan renegotiation under conditions it didn't design. REFERENCES Oxford Energy — "Turmoil in the Middle East." https://www.oxfordenergy.org/wpcms/wp-content/uploads/2026/03/Comment-Turmoil-in-the-Middle-East.pdfWar on the Rocks — "How Does the Iran War Affect China's Energy Security." https://warontherocks.com/2026/03/how-does-the-iran-war-affect-chinas-energy-security/Asia Times — "Post-Khamenei Turmoil Puts China's Energy Security at Risk." https://asiatimes.com/2026/03/post-khamenei-turmoil-puts-chinas-energy-security-at-risk/CleanTechnica — "How China Is Avoiding the Straits of Hormuz Curse." https://cleantechnica.com/2026/03/13/how-china-is-avoiding-the-straits-of-hormuz-curse/Sada News / Bloomberg — China Pressures Tehran on Hormuz. https://www.sadanews.ps/en/business/281469.htmlYeni Safak — China Vows to Secure Energy Supplies. https://en.yenisafak.com/world/china-vows-to-secure-energy-supplies-as-middle-east-conflict-disrupts-oil-flows-3715587CKGSB Knowledge — "US and Venezuela: What It Means for China's Latin America Interests." https://english.ckgsb.edu.cn/knowledge/professor_analysis/us-and-venezuela-what-it-means-for-chinas-latin-america-interests/US-China Economic and Security Review Commission — "China-Venezuela Fact Sheet." https://www.uscc.gov/research/china-venezuela-fact-sheet-short-primer-relationshipAtlantic Council — "After Maduro: Latin America's Policy Community Reassesses the US-China Balance." https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/after-maduro-latin-americas-policy-community-reassesses-the-us-china-balance/China Global South — "How the Strait of Hormuz Disruption Exposed Southeast Asia's Fragile LNG Strategy." https://chinaglobalsouth.com/analysis/how-the-strait-of-hormuz-disruption-exposed-southeast-asias-fragile-lng-strategy/China Diplomacy — China Energy Security Commentary. https://en.chinadiplomacy.org.cn/2026-03/21/content_118394661.shtml

    19 min

  7. APR 12

    04. Connectivity at Scale: The Fiscal Architecture of China’s High-Speed Rail

    China built 48,000 kilometres of high-speed rail in twenty years — the largest network on earth. The productivity gains in the right corridors are real. But only six percent of the network turns a profit, and even the flagship Beijing-Shanghai line needs two decades to recover its construction cost. This episode traces where the debt landed: on local governments and their off-balance-sheet financing vehicles, particularly in inland provinces that built ambitiously on weak passenger demand. That's not an isolated infrastructure story — it shares the same fiscal architecture as the property bust, the same local borrowing, the same deferred losses. We close with three signals worth watching: which new lines get approved or shelved, whether Beijing adjusts the fare structures keeping the network cross-subsidised, and how rail-related debt ultimately gets resolved at the central level. The answers will come from balance sheets, not speeches.

    19 min

  8. APR 5

    03. Year Five - The Property Bust and What Replaces It

    China's real estate crash is now in its fifth year, and the question has quietly changed. It's no longer "when does housing recover?" It's what fills the hole it leaves behind. This episode takes stock of how deep the damage runs: over sixty major developers in default, housing's share of the economy cut in half, eighty million homes sitting empty, and household savings piling up because the apartments that represented most families' wealth have lost much of their value. The fallout goes well beyond the property market itself — local governments that relied on land sales to fund schools and roads are running short, banks are quietly rolling over loans that probably won't be repaid, and China's record trade surplus is partly a symptom of a domestic economy that's consuming less and exporting more to compensate. Beijing is managing a slow retreat, not a rescue. We close with three frameworks for what this means going forward: a more export-heavy growth model, a Japan-style slow grind through unrecognised losses, and a gradual centralisation of where credit and policy support actually flow.

    20 min

  9. MAR 21

    02. Unitree and China's Legged Robot Push

    A robot that can run, climb stairs, and carry a payload — now available from a Chinese company for roughly the price of a mid-range luxury car. That's not a prototype or a government showcase; it's a product you can order. This episode uses Unitree as a lens to examine what's actually happening in China's legged and humanoid robotics sector: the pricing strategy compressing a market that Boston Dynamics spent decades building, the transition from quadrupeds to humanoids, and where Unitree sits within China's broader push to turn AI into physical labor at industrial scale. The harder question isn't whether the hardware is impressive — it is. It's how much of this is real, today, versus still a bet on the future. We map the gap between demonstration and deployment, identify the structural drivers making automation a long-term imperative in China, and lay out three concrete signals to watch: named customer deployments, export volumes outside China, and what the next funding round implies. A useful baseline for capital allocators, industrial operators, and anyone tracking how embodied AI moves from the lab to the factory floor. REFERENCESUnitree Robotics — Product Overview and Technical Documentation. https://www.unitree.com/ Boston Dynamics — Spot Robot Product Information. https://bostondynamics.com/products/spot/ International Federation of Robotics — World Robotics Report 2024. https://ifr.org/ifr-press-releases/news/record-3-million-robots-work-in-factories-around-the-globe China Robot Industry Alliance — China Robotics Market Data. http://www.cria.org.cn/ MIT Technology Review — China's Humanoid Robot Race Coverage. https://www.technologyreview.com/ Reuters — China Robotics and Industrial Automation Coverage. https://www.reuters.com/technology/ CSIS — China's Robotics and Advanced Manufacturing Strategy. https://www.csis.org/ People's Daily — "New Quality Productive Forces" Policy Coverage. https://en.people.cn/ Forbes — Unitree Robotics Coverage. https://www.forbes.com/ YouTube — Unitree Official Channel. https://www.youtube.com/@unitreerobotics

    20 min

  10. MAR 7

    01. Moore Threads and China’s “Four GPU Dragons”

    In this debut episode, we use Moore Threads — often dubbed "China's Nvidia" — as a lens to examine Beijing's push to build a domestic GPU ecosystem under sustained U.S. export controls. From the founding team's roots in global GPU networks, to the policy signals embedded in its Shanghai IPO, to its place within China's "four GPU dragons," this is a grounded briefing on how sanctions, industrial policy, and domestic capital markets are converging around AI hardware. Rather than asking whether Moore Threads can beat Nvidia, we ask the more useful question: what share of China's AI workloads can realistically be served by domestic chips over the next decade — and how fast is that share growing? A useful starting point for capital allocators, operators building AI products in or with China, and anyone tracking how Beijing responds to long-term technology pressure. REFERENCESMoore Threads — Company Overview and Product Materials. https://www.mthreads.com/Biren Technology — Company Overview. https://www.biren.com/Iluvatar CoreX — Company Overview. https://www.iluvatar.com/Innosilicon — Company Overview. https://www.innosilicon.com/Reuters — China Semiconductor and GPU Export Controls Coverage. https://www.reuters.com/technology/CSIS — China's Semiconductor and AI Hardware Strategy. https://www.csis.org/programs/strategic-technologies-programITIF — China's AI Hardware and Export Control Analysis. https://itif.org/Semiconductor Industry Association — State of the Semiconductor Industry. https://www.semiconductors.org/Nvidia — A100 GPU Technical Specifications. https://www.nvidia.com/en-us/data-center/a100/China Securities Regulatory Commission — Shanghai STAR Market IPO Data. http://www.csrc.gov.cn/

    14 min
  • 10 Episodes

About

Welcome to The China Memo. I'm your host: born in China, trained in Western finance, now based in Switzerland. I read what Chinese policymakers, companies, and business people actually say — from a local perspective — and translate it for those tracking China who want the signal without noise. Fact-based. No speculation. We focus on structural trends. Disclaimer: All contents are for educational and informational purposes only. Nothing here constitutes financial, investment, or professional advice.

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