The China Memo

The China Memo

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.

  1. Jul 19

    17. China's Metals Strategy: From Ore to Leverage

    China controls between 50 and 98 percent of midstream refining and smelting across key energy-transition metals — not because it holds the most mines, but because it built the chemistry plants, separation facilities, and accumulated engineering know-how that convert ore into usable materials. Since 2023 it has invested over 120 billion US dollars in overseas mining to extend that position upstream. This episode uses the Stakeholder Map structure to trace who sits where in the system: China running a deliberate asymmetric export control play, the US shifting from catch-up mining toward leapfrog innovation, and resource-holding countries in Africa and Latin America exercising their own leverage through resource nationalism. The second-order effect most coverage misses: both Western diversification pressure and resource nationalism are simultaneously producing a more fragmented, more expensive global supply chain — not a clean alternative chain. Three markers: the November 2026 rare earth control pause expiry, whether non-Chinese processing projects hit timelines, and progress on rare-earth-free magnet technologies. REFERENCES BBC — "China Rare Earths and Critical Minerals." https://www.bbc.com/news/articles/cj6wwx7zxd9o SmallCaps — "China's Midstream Metals Dominance Sparks Strategic Alarm." https://smallcaps.com.au/article/chinas-midstream-metals-dominance-sparks-strategic-alarm CaixaBank Research — "China's Alchemy: How It Transforms Critical Minerals into Global Power." https://www.caixabankresearch.com/en/economics-markets/commodities/chinas-alchemy-how-it-transforms-critical-minerals-global-power Mining.com — "China Spent $120B to Lock Down Critical Minerals Dominance." https://www.mining.com/china-spent-120b-to-lock-down-critical-minerals-dominance-report/ INSS — Strategic Assessment: Metals. https://www.inss.org.il/strategic_assessment/metal/ LinkedIn / Discovery Alert — China Rare Earth Processing Analysis. https://www.linkedin.com/posts/discovery-alert-australia_china-controls-over-90-of-rare-earth-processing-activity-7412673763843956736-8Mxu LSE Grantham Institute — "China's Role in Accelerating the Global Energy Transition Through Green Supply Chains." https://www.lse.ac.uk/granthaminstitute/wp-content/uploads/2024/02/Chinas-role-in-accelerating-the-global-energy-transition-through-green-supply-chains-and-trade.pdf CFR — "Leapfrogging China's Critical Minerals Dominance." https://www.cfr.org/reports/leapfrogging-chinas-critical-minerals-dominance BBC — "US Critical Minerals Ministerial and Project Vault." https://www.bbc.com/news/articles/c5y41r5rzrno SIPRI — Critical Minerals Report. https://www.sipri.org/sites/default/files/2024-10/critical_minerals.pdf InvestingNews — "China Rare Earth Processing Domination." https://investingnews.com/china-rare-earth-processing-domination/ Global Trade Alert — "Chinese Export Controls on Critical Raw Materials." https://globaltradealert.org/blog/chinese-export-controls-on-critical-raw-materials-inventory

  2. Jul 9

    16. Lying Flat and Involution: China's Two New Catchphrases Explained

    Neijuan (involution) and tangping (lying flat) are not about laziness, and they are not primarily about political protest. They are the vocabulary a generation has developed to describe a rational recalibration: the experience of running hard on a treadmill that is no longer moving forward at the speed they were promised. This episode takes the moral failure reading seriously — Confucian culture places real weight on effort as virtue — before showing where it stops being sufficient. Housing as an arithmetic problem. Graduate oversupply. Extreme effort required to maintain position rather than advance. Three markers to watch: whether structural conditions change fast enough to alter the incentive calculation, consumption patterns among the 25–35 cohort, and how the vocabulary evolves in online discourse. REFERENCES The Guardian — "What Is Neijuan? China's Viral Buzzword — Laptop Bicycle." https://www.theguardian.com/world/2024/dec/24/what-is-neijuan-china-viral-buzzword-laptop-bicycle BBC — "Lying Flat: Why Some Chinese Are Refusing to Run in the Rat Race." https://www.bbc.com/news/world-asia-china-57348406 Wikipedia — "Neijuan." https://en.wikipedia.org/wiki/Neijuan Long Advisory — "Neijuan in China: From Endless Competition to a New Way of Living." https://longadvisory.eu/en/neijuan-in-china-from-endless-competition-to-a-new-way-of-living/ Taipei Times — "Neijuan and the Chinese Youth Burnout." https://www.taipeitimes.com/News/feat/archives/2024/12/25/2003829068 PMC / NCBI — "Lying Flat Academic Study." https://pmc.ncbi.nlm.nih.gov/articles/PMC9709313/ Made in China Journal — "Lying Flat: Profiling the Tangping Attitude." https://madeinchinajournal.com/2023/01/08/lying-flat-profiling-the-tangping-attitude/ Brookings — "The Lying Flat Movement Standing in the Way of China's Innovation Drive." https://www.brookings.edu/articles/the-lying-flat-movement-standing-in-the-way-of-chinas-innovation-drive/ European Guanxi — "Tang Ping: A New Work Lifestyle for a New Workforce." https://www.europeanguanxi.com/post/tang-ping-a-new-work-lifestyle-for-a-new-workforce East Asia Forum — "China's Young Lie Flat Under Social Challenges." https://eastasiaforum.org/2022/10/27/chinas-young-lie-flat-under-social-challenges/ Sciences Po HAL — "Tangping Academic Study." https://sciencespo.hal.science/hal-05397646v1/document

  3. Jul 4

    15. The Glass Backbone: How China's Optical Fiber Feeds the AI Era

    The AI conversation is dominated by chips. But before any compute can do useful work, data has to move — through thin strands of glass called optical fiber. And China makes more of it than the rest of the world combined: over half of global fiber and cable, around 65 percent of fiber-optic components, and a single Wuhan cluster called Optics Valley that accounts for roughly a quarter of the international market. This episode traces the arc from China's first optical fiber, pulled in a Wuhan lab in 1976, to the glass backbone now feeding China's AI infrastructure through the "East Data, West Computing" program. It covers the strategic upstream — preforms, which carry 70 percent of industry profits and where China has driven self-sufficiency above 85 percent — and the national champion YOFC. The closing question: whether dominating the physical layer of AI carries the same strategic leverage as dominating the chips, or whether the glass, unlike leading-edge semiconductors, is essential but replicable. REFERENCES China Optics Valley — "China's Optical Fiber and Cable Industry Overview." http://www.chinaopticsvalley.com/2022-09/02/c_808066.htm Wuhan Government — "Optics Valley East Lake High-Tech Zone." https://www.wuhan.gov.cn/wwwz/ywwz_1/H_1/NWP/202211/t20221104_2084729.shtml Grand View Research — "China Fiber Optics Market Outlook." https://www.grandviewresearch.com/horizon/outlook/fiber-optics-market/china IBISWorld — "Optical Fiber and Cable Manufacturing in China." https://www.ibisworld.com/china/industry/optical-fiber-and-cable-manufacturing/611/ ResearchInChina — "China Optical Fiber Preform Industry Report." http://www.researchinchina.com/Htmls/Report/2019/11625.html China Daily — "YOFC: Global Market Leader in Optical Fiber and Cable." https://www.chinadaily.com.cn/a/202311/07/WS6549991ba31090682a5eccf7.html Chinese Academy of Engineering — "Active Optical Fiber Materials and Strategic Technologies." https://www.engineering.org.cn/sscae/EN/10.15302/J-SSCAE-2024.03.017 Corning — "Optical Fiber Makes Artificial Intelligence Possible." https://www.corning.com/worldwide/en/the-progress-report/crystal-clear/optical-fiber-makes-artificial-intelligence-possible VSOL — "Why Fiber Network Is the Backbone of the AI Era." https://www.vsolcn.com/blog/why-fiber-network-is-the-backbone-of-ai-era.html Fiber Broadband Association — "The Virtuous Circle of Fiber and AI." https://fiberbroadband.org/2025/07/11/the-virtuous-circle-of-fiber-and-ai/ FiberLight — "Synergies at Play: AI and Fiber Optics." https://www.fiberlight.com/blog/synergies-at-play-ai-and-fiber-optics/ IFM Investors — "Beyond Data Centres: Could Fibre Optic Networks Bridge the AI Divide." https://www.ifminvestors.com/news-and-insights/thought-leadership/beyond-data-centres-could-fibre-optic-networks-bridge-the-ai-divide/ FOB Sourcify — "Fibre Company Road to China Light." https://www.fobsourcify.com/fibre-company-road-to-china-light/

  4. Jun 27

    14. China's Second Great Grid: The Hardware Behind Net Zero and AI

    China has crossed an inflection point in its energy transition: the binding constraint is no longer whether it can manufacture renewable energy equipment, but whether its grid infrastructure can absorb, transport, and time-shift what that equipment produces. This episode maps the build-out — the pumped-storage hydro fleet, the battery additions, the UHV transmission lines, and the co-location of data centres with renewable energy clusters — and identifies the structural stakeholders: who benefits from the infrastructure layer, who bears the timing risk from weak market design, and what the second-order commercial shift looks like as value migrates from commodity hardware toward grid equipment, power electronics, and storage management software. Three forward-looking markers: curtailment rates, battery utilisation hours, and the pace of electricity market reform. REFERENCES   Energy Connects — "China Accelerates Grid Projects to Keep Up with Renewables Boom." https://www.energyconnects.com/news/utilities/2024/june/china-accelerates-grid-projects-to-keep-up-with-renewables-boom/ China.org.cn — "China's New Energy Storage Capacity." http://www.china.org.cn/business/2024-08/01/content_117343807.htm World Economic Forum — "China Adding More Renewables to Grid." https://www.weforum.org/stories/2025/12/china-adding-more-renewables-to-grid/ English.www.gov.cn — "Pumped-Storage Hydro Targets and Approvals." https://english.www.gov.cn/news/202409/03/content_WS66d67fa9c6d0868f4e8ea836.html Carbon Brief — "How China Became the World's Leading Market for Energy Storage." https://www.carbonbrief.org/qa-how-china-became-the-worlds-leading-market-for-energy-storage/ Energy Storage News — "China Aims for Energy Storage Installations Equivalent to Today's Global Capacity by 2027." https://www.energy-storage.news/china-aims-for-energy-storage-installations-equivalent-to-todays-global-capacity-by-2027/ Bloomberg — "China Aims to More Than Double Energy Storage Capacity by 2027." https://www.bloomberg.com/news/articles/2025-09-12/china-aims-to-more-than-double-energy-storage-capacity-by-2027 ScienceDirect — "Co-optimising Storage and Demand Response in China's 2050 Power System." https://www.sciencedirect.com/science/article/abs/pii/S0301479724037915 Wikipedia — "Renewable Energy in China." https://en.wikipedia.org/wiki/Renewable_energy_in_China CNESA — "China's First Grid-Forming Wind-Solar-Storage Integrated System." http://en.cnesa.org/latest-news/2025/10/13/chinas-first-grid-forming-wind-solar-storage-integrated-system-for-substations-put-into-operation

  5. Jun 21

    13. China's Renewables and the 2035 System Bet

    In 2024, China spent close to 940 billion dollars on clean energy — nearly matching what the entire world spent on fossil fuels that same year — and has now installed more than 1.8 terawatts of wind and solar capacity. This episode traces the policy loop that built that scale, from the 2005 Renewable Energy Law through the manufacturing dominance phase, to the 15th Five-Year Plan's pivot toward system integration: transmission corridors, market-based pricing, and storage. Buried in the plan's technical annexes is an implied 2035 target of over 3.6 terawatts of wind and solar and roughly 4,700 gigawatts of total non-fossil capacity — effectively doubling current levels within a decade. The episode examines three risks that could push that arc off course: transmission and storage lagging capacity growth, subsidy-transition friction including price cannibalization in the merchant power market, and coal retrofit economics proving stickier than planned. It closes by identifying three markers worth tracking through 2030 — annual capacity additions, transmission corridor progress, and China's export position under global trade friction. REFERENCES Renewable Institute — "China's Clean Energy Boom: 940 Billion of Investments Power a Greener Future." https://www.renewableinstitute.org/chinas-clean-energy-boom-940-billion-of-investments-power-a-greener-future/ World Economic Forum — "China Adding More Renewables to Grid." https://www.weforum.org/stories/2025/12/china-adding-more-renewables-to-grid/ PV Magazine — "China Five Year Plan Deepens Shift Toward Renewables." https://www.pv-magazine.com/2026/03/18/china-five-year-plan-deepens-shift-toward-renewables-system-focus/ WindTech International — "China's 15th Five Year Plan Sets Direction for Renewables." https://www.windtech-international.com/industry-news/chinas-15th-five-year-plan-sets-direction-for-renewables-expansion-and-wind-growth-to-2030 Carbon Brief — "What Does China's 15th Five Year Plan Mean for Climate Change." https://www.carbonbrief.org/qa-what-does-chinas-15th-five-year-plan-mean-for-climate-change/ E3G — "China's 15th Five Year Plan: A Green Transition Anchored in a Globally Oriented Growth Strategy." https://www.e3g.org/news/china-s-15th-five-year-plan-a-green-transition-anchored-in-a-globally-oriented-growth-strategy/ 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/ ABC Australia — "China Unveils Five Year Plan for Green Energy Renewables." https://www.abc.net.au/news/2026-03-17/china-unveils-five-year-plan-for-green-energy-renewables/106448728 Power Technology — "China Renewable Energy Subsidies." https://www.power-technology.com/news/china-renewable-energy-subsidies/ Reuters — "Investors Bet Iran War Will Boost Chinese Renewables Demand." https://www.reuters.com/sustainability/boards-policy-regulation/investors-bet-iran-war-will-boost-chinese-renewables-demand-2026-03-24/ IISD — "Public Finance for Renewable Energy in China." https://www.iisd.org/system/files/publications/public_finance_renewable_energy_china.pdf Climate Cooperation — "China's 15th Five Year Plan Recommendations." https://climatecooperation.cn/climate/chinas-15th-five-year-plan-recommendations-set-out-chinas-energy-and-climate-priorities/ People's Daily — China Renewable Energy System Overview. https://en.people.cn/n3/2026/0302/c98389-20430326.html

  6. Jun 14

    12. A, B, H, N: The Chinese Share Classes Explained

    The same Chinese company — ICBC, PetroChina, any major dual-listed name — can trade at materially different prices in Shanghai and Hong Kong on the same day. That A-H premium is not a pricing error. It is a structural feature of how China's equity markets are segmented. This episode explains the four main Chinese share classes — A, B, H, and N — covering where each is listed, who trades it, what kind of companies you find inside it, and how each behaves differently from the others. A companion to our episode on Chinese stock indices. Between the two, you have the map and the terrain. REFERENCES LSEG / FTSE Russell — "Guide to Chinese Share Classes." https://www.lseg.com/content/dam/ftse-russell/en_us/documents/policy-documents/guide-to-chinese-share-classes.pdf Investopedia — "Differences Between H-Shares and A-Shares." https://www.investopedia.com/ask/answers/062315/what-are-differences-between-hshares-and-ashares-chinese-and-hong-kong-stock-exchanges.asp Invesco — "China ETF Share Classes Infographic." https://www.invesco.com/content/dam/invesco/emea/en/pdf/China-etf-infographic-EN.pdf Sinorbis — "Understanding the Chinese Stock Market." https://www.sinorbis.com/understanding-the-chinese-stock-market MSCI — "MSCI China Index." https://www.msci.com/indexes/index/302400 ScienceDirect — "A-Share and B-Share Volatility Study." https://www.sciencedirect.com/science/article/abs/pii/S1059056003000030 ScienceDirect — "A-H Share Premium Study." https://www.sciencedirect.com/science/article/abs/pii/S104402832100017X B2Prime — "H-Shares vs A-Shares: What Are They and How Do They Differ." https://b2prime.com/news/h-shares-vs-a-shares-what-are-they-and-how-do-they-differ Monmouth University — "Valuation Differential Between Class A and B Shares." https://www.monmouth.edu/directory/documents/2018/09/the-valuation-differential-between-class-a-and-b-shares-country-risk-in-the-chinese-stock-market.pdf/ Bogleheads Forum — China A-Share Investor Base Discussion. https://www.bogleheads.org/forum/viewtopic.php?t=185827 YouTube — H-Shares vs A-Shares Explainer. https://www.youtube.com/watch?v=fWSbUfo96_c

  7. May 28

    11. National Reading Week: China Wants you to Read More and Scroll Less

    On April 20, 2026, China launched its first National Reading Week. Official framing positions it as a cultural initiative — books, libraries, literacy — with no mention of smartphones or screens. This episode argues that framing is accurate but incomplete. Reading Week is the positive-reinforcement arm of a broader state effort to recalibrate how Chinese people spend their attention: the same policy environment that includes school phone bans, gaming time limits for minors, and university research on smartphone harm. Three markers to watch: whether reading metrics actually move over successive Reading Week cycles, whether the positive and restriction tracks begin to converge in policy language, and how digital reading is positioned within the framework. #China #ChinaEconomy #ChinaBusiness #GlobalMacro #EmergingMarkets REFERENCES Xinhua — "China Sets Annual National Reading Week Starting from 2026." https://english.news.cn/20260420/0332d65b87004997aec5d3fa209eee38/c.htmlXinhua — "Record Number of Enterprises in Ice and Snow Tourism." https://english.news.cn/20260106/b983b69b049f4873b98f8ce0bac608e5/c.htmlChina SCIO — "First National Reading Week and 5th National Conference on Reading." http://english.scio.gov.cn/topnews/2026-04/21/content_118449063.htmlBastille Post — "China Sets Annual National Reading Week." https://www.bastillepost.com/global/article/5305195-china-sets-annual-national-reading-week-starting-from-2026China Daily — "National Reading Promotion Regulations in Force February 2026." https://www.chinadaily.com.cn/a/202604/20/WS69e64707a310d6866eb447d0.htmlChina Daily HK — "China Library Infrastructure: 3,248 Public Libraries by End 2024." https://www.chinadailyhk.com/hk/article/626634Global China Daily — "China Reading Week Activities." http://global.chinadaily.com.cn/a/202604/20/WS69e5e828a310d6866eb44708.htmlChina.org — "Nationwide Reading Part of 15th Five-Year Plan." http://www.china.org.cn/2026-04/20/content_118447717.shtmlPeople's Daily — "More Than Gold: China's Ice and Snow Sports Boom." https://en.people.cn/n3/2026/0420/c90000-20448289.htmlGlobal Times — "China's Silver Economy Upgrade Fuels Rapid Rise of Elderly-Friendly Toys." https://www.globaltimes.cn/page/202602/1355101.shtml

  8. 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

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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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