May 6, 2020

Axios China

Happy Wednesday, and welcome back to Axios China. Today we've got leaked coronavirus intel, tariffs, quid pro quos, and more.

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  • Today's newsletter is 1,487 words, and 6-minute read.
1 big thing: U.S. statements on coronavirus origins diverge from allies

Illustration: Eniola Odetunde/Axios

In the past week or so, Americans have been inundated with intelligence reports and other information relating to the origin of the novel coronavirus. Yet these leaks seem at times to present conflicting information.

The big picture: The U.S. is bullish on the possibility that the coronavirus outbreak started with a lab accident in China. But U.S. allies say that's unlikely.

What's happening: In leaked reports and recent statements, U.S. officials have repeatedly emphasized the possibility that the epidemic resulted from accidental transmission in a Chinese lab, perhaps the Wuhan Institute of Virology.

  • A set of leaked State Department cables from officials who visited the WIV in January 2018, and published by the Washington Post on April 14, warned of safety issues at the lab.
  • The messages also noted that the lab's research on coronaviruses from bats showed that such viruses had the potential for human-to-human transmission and thus posed a risk of a pandemic.
  • Anonymous officials told Fox News on April 15 that the U.S. government has "increasing confidence" that the epidemic started accidentally at a Chinese lab.

But here's where it starts to get complicated:

  • In a rare public statement on April 30, the Office of the Director of National Intelligence said the intelligence community was still investigating the matter, implying they did not have that degree of certainty.
  • What they're saying: "The IC will continue to rigorously examine emerging information and intelligence to determine whether the outbreak began through contact with infected animals or if it was the result of an accident at a laboratory in Wuhan.” 

The next day, however, President Trump seemed to contradict his own intelligence agencies by emphasizing the link once again.

  • Trump said on May 1 that he has a "high degree of confidence" that the outbreak originated in a lab accident in China.
  • Secretary of State Mike Pompeo said in a May 3 interview: "While the intelligence community continues to do its work, they should continue to do that, and verify so that we are certain, I can tell you that there is a significant amount of evidence that this came from that laboratory in Wuhan."

But, but, but: U.S. allies who have had access to shared intelligence don't seem to agree with that assessment.

The Five Eyes dossier: A 15-page report prepared by governments of the Five Eyes, an intelligence-sharing partnership between the U.S., Canada, Australia, New Zealand and the U.K., found:

  • China's cover-up in the early days of the epidemic cost tens of thousands of lives, but it doesn't place the blame squarely on a lab.
  • The Australian government believes there is just a 5% chance the virus came from the WIV and says it more likely originated in a wet market.

Anonymous Western officials then told CNN it was "highly unlikely" the coronavirus spread via a lab accident, citing an intelligence report seen by the Five Eyes countries.

The bottom line: The U.S. position is increasingly at odds with what its intelligence-sharing partners are saying.

2. American concern about China tariffs hits record high
Data: CivicScience; Chart: Axios Visuals

Concern about President Trump's tariffs on U.S. imports of Chinese goods hit its highest level on record in April, as the coronavirus pandemic caused more Americans to fear their impact on household finances, according to the latest survey from CivicScience, Axios' Dion Rabouin writes.

Where it stands: The tariffs remain a massive tax on American businesses and individuals at a time when Congress and the Federal Reserve are expending trillions of dollars to offset the negative economic shock of the virus.

  • Trump said in an interview Sunday that he was considering adding further duties, which he called the “ultimate punishment,” and threatened to walk away from the "phase one" trade deal with China.

Reality check: The tariffs have wiped out the lion's share of the average American households' savings from the 2017 tax cut, as Bloomberg noted in June.

  • And the president’s tariffs rank as "one of the largest tax increases in decades," CNBC reported in May 2019, citing data from the Treasury Department.

Go deeper: Businesses say China tariffs contributing to hand sanitizer shortages

3. Beijing demanded praise in exchange for medical supplies

Illustration: Sarah Grillo/Axios

A growing number of reports indicate Chinese officials pushed their counterparts in Europe to make positive statements about China in order to receive shipments of medical supplies to fight the novel coronavirus.

Why it matters: The revelations further taint Beijing's attempts to portray itself as a responsible and trustworthy leader in global public health.

Context: Over the past two months, numerous high-ranking government officials from countries fighting coronavirus outbreaks have offered seemingly effusive praise to China for its assistance.

  • The Italian foreign minister credited China with saving lives in Italy, the Serbian president kissed the Chinese flag as he welcomed a shipment of medical supplies on the tarmac, and the Mexican foreign minister tweeted a photo of a plane delivering Chinese aid, writing "Gracias China!!!"

What's happening: Officials in some countries are now saying there was pressure to praise Beijing.

Poland: In exchange for medical supplies, Chinese officials pressured Polish President Andrzej Duda to call Chinese President Xi Jinping to express gratitude.

  • “Poland wasn’t going to get this stuff unless the phone call was made, so they could use that phone call” for propaganda purposes, the U.S. ambassador to Poland, Georgette Mosbacher, told the New York Times.

Germany: German officials have been approached by Chinese counterparts trying to get them to make positive public statements about China’s coronavirus response and international assistance, according to German newspaper Die Welt Am Sonntag.

What they're saying: “What is most striking to me is the extent to which the Chinese government appears to be demanding public displays of gratitude from other countries; this is certainly not in the tradition of the best humanitarian relief efforts," Elizabeth Economy of the Council on Foreign Relations told the Times.

  • “It seems strange to expect signed declarations of thanks from other countries in the midst of the crisis.”

The bottom line: A quid pro quo for vital medical aid alienates global audiences who had at first been inclined to welcome Chinese Communist Party leadership in the fight against the coronavirus.

  • "The fairly aggressive party-state effort to 'tell a good China story' actually increases public awareness that these propaganda efforts on the Chinese side are going on," Thorsten Benner, director of the Global Public Policy Institute in Berlin, told Axios.
  • "They are shooting themselves in the foot by being so pushy on this."

Go deeper:

4. WHO members to discuss Taiwan's status

People holding up a Taiwan National Flag in Hong Kong, Oct. 10, 2019. Photo: Vernon Yuen/NurPhoto via Getty Images

World Health Organization legal counsel Steven Solomon said on May 4 that two WHO member nations have proposed the organization grant observer status to Taiwan.

  • Solomon said the 194 WHO member states will discuss Taiwan's status at the upcoming World Health Assembly, the organization's decision-making body, to be held virtually on May 18 and 19.

Why it matters: China opposes the WHO granting recognition to Taiwan. The decision will likely be seen as a reflection of Beijing's influence within the organization.

What's happening: Taiwan's successful coronavirus response and its early warnings to the WHO have renewed international debate around its lack of official status in the organization.

Background: Taiwan had observer status in the WHO from 2009 to 2016, when Tsai Ing-wen, who favored more distant relations with China, was elected president of Taiwan.

  • After Tsai's election, Beijing took numerous measures to isolate Taiwan internationally, including poaching several of its few remaining diplomatic allies.

What to watch: The debate over Taiwan's status may turn into a superpower showdown.

  • China will oppose restoring Taiwan's observer status and will likely seek to mobilize its supporters to shut down any related discussion.
  • The U.S. has long been a strong supporter of Taiwan, and this morning Secretary of State Mike Pompeo urged WHO member states to give Taiwan observer status.
5. What I'm reading

Just the facts: COVID-19: China medical supply chains and broader trade issues (Congressional Research Service)

  • If you're interested in U.S. supply chain dependency on China, this report from Karen Sutter, the unsung hero of the Congressional Research Service, lays out the details without sensationalism.

Losing hearts and minds: ‘Not the world’s Number One’: Chinese social media piles on the U.S. (Politico)

  • The disastrous U.S. coronavirus response "telegraphs a wound to America’s image even deeper and wider than the one sustained after the 2008 financial crisis, which convinced many Beijing policymakers that the United States was more paper than tiger," writes David Wertime, Politico's new editorial director for China.

Scientific model: The Chinese Academy of Sciences at 70 (Nature)

  • "It has taken more than 30 years for CAS to achieve this level of autonomy, but it means that China’s leadership cannot control scientists in quite the same way it was able to do in the 1950s and 1960s."
6. 1 censorship thing: Chinese media blurs out Beckham's tattoos

Screenshot: CCTV 9

Even tattoos can be off-limits in Chinese state media.

  • A 45-minute documentary about British soccer superstar David Beckham, aired by Chinese state broadcaster CCTV, carefully blurred out every single tattoo, as Tony Lin, a producer for Quartz, pointed out on Twitter.
  • That is quite a feat for a 45-minute film, as the man is inked up from the backs of his hands to his neck.
  • One scene, where Beckham goes shirtless and his tatted-up torso is entirely blurry, is "almost a modern art," said Lin. (You can watch that scene here, at 40:58.)

In recent years, censorship in China has become far more stringent, as the Chinese Communist Party has cracked down on not just political dissent but also the portrayal of vices and what they deem to be immoral behavior.