AGP Executive Report

China-EU Trade Talks: China invited EU trade chief Maros Šefčovič to co-chair the second China-EU trade and investment consultation meeting in autumn, after the first session in Brussels focused on AI, green transition, services and market access. Beijing Skyscraper Crash: Authorities said the pilot who crashed a small plane into the CITIC Tower acted for “personal reasons,” citing chronic insomnia and anxiety and diary entries about ending his life. Tech & Markets: Humanoid robot maker Unitree won CSRC IPO registration approval for the STAR Market, while Alibaba moved to fully spin out its cloud unit, fueling speculation about political and market pressures. Overseas Chinese Heritage: Fujian’s new provincial regulations on protecting overseas Chinese historical and cultural heritage took effect, aiming to unify protection for diaspora sites and memories. Science & Culture: A new exhibition, “Heavenly Questions,” opened in Anhui to trace China’s cosmic worldview from ancient skywatching to modern space exploration. Regional Connectivity: China reiterated it will push ahead with a Bangladesh-Myanmar economic corridor and said it remains open for India and others to join. Energy & Investment Abroad: Zimbabwe urged Chinese investors to follow local labour laws and engage in social dialogue as Chinese investment tops $10bn; meanwhile Pakistan’s energy ministry discussed a broad Shandong Xinxu plan spanning oil and gas, refinery upgrades and energy equipment.

Ethnic Affairs Law: Tibetan activists and rights groups protested as China’s Ethnic Unity and Progress Promotion Law took effect, warning it could erode Tibetan identity and language. Military & Governance: Xi Jinping marked the CPC’s 105th anniversary by pledging to modernize the military and intensify anti-corruption “iron rules” for senior cadres. Economy Pulse: A Caixin “new economy” gauge rose in June, with growth driven by capital, tech and labor inputs in high value-added sectors. Markets & Crackdowns: China’s tax enforcement is hitting A-shares and Hong Kong-listed firms with large supplementary payments, raising investor jitters. Tech & Trade: EU and think-tank warnings say Europe’s chip push faces a “bleak future” amid US tech pull and China-linked supply leverage. Cross-border Finance: The US SEC is probing alleged $100 million insider trading tied to a crackdown on cross-border brokerages, including Futu and Tiger. Energy Innovation: Chinese researchers unveiled solar-powered desalination that can run without electricity, aiming for lower costs than bottled water. Regional Links: Pakistan and China signaled CPEC 2.0’s next phase, focusing on industry, agriculture, IT, mining and skills. Weather & Safety: A tropical depression is forecast to strengthen into a typhoon with landfalls in southern China, while a separate Qinghai crash killed eight.

U.S.-China Diplomacy: China urged the U.S. to lift unilateral sanctions on Iran and fully implement the Iran MoU, while also calling on both sides to stay on course toward “constructive” strategic stability after a Wang Yi–Rubio phone call. AI & Tech Rivalry: A U.S. AI control move targeting Anthropic was reportedly reversed after days, underscoring the fast-shifting battle over open vs gated models. Outbound Investment Rules: China’s new outbound investment regulation took effect, giving authorities broader “national security” oversight as Beijing pushes high-tech and green sectors while tightening capital flows. Space & Security: China is working on a space-ground monitoring network for asteroid defense, aiming for round-the-clock surveillance with no blind spots. Energy & Industry: China’s Windrose Electric eyes a $2b-plus US SPAC listing this year, while Chinese firms keep expanding in global BESS integration. Economy & Markets: Foreign holdings of Chinese A-shares hit a record in the first half, and China’s chip IPO pace is accelerating as AI demand boosts listings. Society & Governance: A new “ethnic unity” law takes effect, expanding state integration policies and drawing international backlash. Local Life: Graduation ceremonies across China are getting more playful and personalized, with viral tassel-turning and themed outfits.

Party-State Update: Xi Jinping told the Communist Party to keep pace with “changing circumstances” while safeguarding gains, pointing to slower growth, demographic decline, tech curbs, U.S. trade turbulence, and Taiwan tensions. Markets & Industry: China’s June manufacturing PMI rose to 50.3 and services PMI to 50.2, signaling expansion and lifting tech shares as investors looked for momentum. Trade & Regulation: The EU ended duty-free entry for low-value parcels under €150 from July 1, pushing Chinese cross-border sellers toward localized fulfillment. Tech & Security: U.S. lobbying firms are cutting ties with Chinese tech giants ahead of new Pentagon-related restrictions. Energy & Supply Chains: China launched a sea-river intermodal zero-carbon shipping route using a pure electric container vessel, aiming to cut fuel use and emissions. Geopolitics: Taiwan reported 13 PLA sorties and multiple vessels around the island. Biotech: Samsung Bioepis opened its first overseas R&D office in Beijing to accelerate drug discovery. Legal/Compliance: China arrested two Fuji Electric employees over alleged rare-earth-related smuggling attempts. Global Finance: The UN General Assembly changed a budget rule to stop member states from demanding return of unspent funds before paying dues.

US Court Fallout: Fugitive Chinese billionaire Guo Wengui was sentenced to 30 years in a Manhattan federal prison for a $1B+ fraud scheme, with the judge ordering $889M in forfeiture; prosecutors said he raised over $1B from followers via investment and crypto promises while funding luxury assets. Anti-Corruption Crackdown: China jailed former Henan security official Liu Mancang for life for taking 316 million yuan in bribes, stripping him of political rights and confiscating personal property. Tech Self-Reliance Push: China unveiled “Yisuanfangzhou,” a software platform meant to help researchers run complex science workloads on domestic high-performance chips, aiming to reduce dependence on NVIDIA’s CUDA ecosystem. AI Model Release: Meituan open-sourced LongCat-2.0, a 1.6T-parameter coding model trained on domestic Chinese chips, underscoring the push to build AI on homegrown hardware. Trade & Industry Tensions: China imposed export controls on 40 Japanese entities over “new militarism,” while Bayer sought new duties on Chinese glyphosate imports. Aviation Safety Move: After a fatal crash into Beijing’s CITIC Tower, China reportedly grounded much of general aviation nationwide, raising questions for the low-altitude economy. Diplomacy & Global Governance: China’s top diplomat met UN secretary-general candidate Maria Fernanda Espinosa, reiterating support for a stronger UN role in global governance. Local Governance Spotlight: A CPC “July 1 Medal” nominee profile highlights grassroots community mediation in Chongqing, reflecting how party honors spotlight public service.

Hong Kong IPO Watch: Momenta Global kicked off subscriptions for its Hong Kong listing, with cornerstone and strategic investors including GIC, Fidelity and BlackRock committing about USD376m; the IPO is set for July 7 at HKD295.60 per share, aiming to raise up to HKD5.9bn. AI Race, China Style: Meituan released LongCat-2.0, a claimed 1.6-trillion-parameter AI model trained on home-grown hardware, positioning it as a major step in China’s push to scale frontier AI domestically. Manufacturing Momentum: China’s official manufacturing PMI rose to 50.3 in June, with new orders and production both expanding, pointing to steadier factory activity tied to AI-related exports. Trade Talks in Brussels: The EU and China launched a new three-month dialogue focused on export controls, IP rights and trade-rule changes, with a monitoring setup aimed at preventing fresh “China shock” disruptions. Domestic Market Push: China’s top political advisor Wang Huning urged more practical policy research to help build a stronger domestic market as the 15th Five-Year Plan period gets underway. US Court Fallout: Exiled tycoon Guo Wengui was sentenced to 30 years in a US prison for a fraud scheme that prosecutors said cost more than USD1bn. South China Sea: China’s military and coast guard carried out patrols around Scarborough Shoal, escalating tensions after US-Philippine drills nearby.

China’s diplomacy at the UN: Foreign Minister Wang Yi met Senegal’s Macky Sall, backing a stronger UN with a central, leading role and urging the next secretary-general to reflect Global South priorities. China-EU trade tensions: Brussels and Beijing set an October target to make progress on a widening goods dispute, with the EU citing a €360 billion deficit and EVs as a key flashpoint. Japan export-control escalation: China widened export curbs to 40 Japanese entities over “new militarism,” deepening a sanctions spiral that also coincides with the yen hitting a 40-year low. Regional security signals: China’s coast guard escorted a government survey ship near overlapping Japan-Philippines EEZ waters, a move tied to jurisdiction claims near Taiwan. Earthquake response in Sichuan: A 5.5 quake hit Gaoxian County, injuring 15 and triggering Level-IV disaster response, evacuations, and ongoing rescue work. Business and tech momentum: Hurun says China is now home to 381 unicorns, accelerating new listings; Meta’s AI chief argues “economically valuable” agentic AI should deliver real-world impact. Energy transition push: LONGi’s solar-plus-storage integration pitch and China’s emergency aid to Venezuela highlight the country’s climate and disaster-response priorities.

Earthquake Update (Sichuan): A 5.5-magnitude quake hit Gaoxian County in Yibin, Sichuan early Monday, with no deaths reported and 13 people sustaining minor injuries; 196 others were relocated and roads saw rockfalls that authorities cleared. Central Banking (Liquidity): China’s central bank launched overnight reverse repo operations for the first time, offering 300 billion yuan, while also injecting 157.5 billion yuan via seven-day reverse repos as markets read the move as tighter control of liquidity. China-EU Trade (Cooling the Heat): A Xinhua commentary argues Chinese cooling products and Europe’s own reliance on Chinese intermediate goods show why dialogue—not escalation—should cool China-EU trade tensions. AI & Industry (Profits): Official data says China’s major industrial firms’ profits rose 18.8% in Jan-May, driven by AI-related electronics and new-energy materials. Geopolitics (Japan Export Controls): China announced export restrictions on 40 Japanese entities, splitting them into a control list with outright dual-use bans and a watch list with tighter scrutiny. Business (Aviation): China Eastern plans to buy 25 Airbus A330neo jets in a deal worth about $9.35 billion at list prices, supporting long-haul expansion.

US-China Tech Tensions: The FCC expanded bans on imports of Chinese telecom and surveillance gear, now covering older “legacy” models from Huawei, ZTE, Hytera, Hikvision and Dahua, citing national security risks. Apple vs Washington: Apple is reportedly lobbying the Trump administration for permission to buy memory chips from CXMT, a firm on a military-linked list, as chip shortages push up prices for iPads and MacBooks. China’s Industrial Pulse: China says major industrial profits rose 18.8% in Jan–May 2026, led by electronics and high-tech manufacturing tied to AI demand. Energy & Materials Push: China backed Ghana’s energy self-reliance as a refinery expansion in Tema boosts capacity to 100,000 barrels/day; at home, CNBM started three major carbon-fiber production lines. Clean Energy Leap: A giant deep-sea floating offshore wind platform set sail from Zhuhai, aiming to scale commercial generation. Geopolitics at Sea: A China-flagged vessel was monitored near the Philippines’ Batanes area, raising questions about activity in the EEZ. Human Rights & Migration: Chinese dissident Dong Guangping, who fled by dinghy to South Korea, has arrived in Canada. Disaster Watch: A 5.29 quake hit Sichuan; China also issued flood-prevention alerts for heavy rain in southern regions. Local Life: In San Francisco Chinatown, a Chinese Newcomers Service Center food giveaway delivered 5,000 bags to seniors and low-income families.

China-Russia Patrol: China and Russia carried out another joint strategic air patrol over the Sea of Japan, East China Sea and the western Pacific, drawing fighter-jet scrambles from Japan and South Korea as both sides also move to expand missile systems. AI Power Crunch: With data centres straining electricity grids, Chinese chipmakers are betting on silicon carbide (SiC) for more efficient AI infrastructure, as one SiC firm pushes toward an IPO in Hong Kong. Industrial Profit Bounce: China’s major industrial firms reported profits up 18.8% year-on-year in Jan–May, signaling momentum despite uneven demand. Gold Rules Update: China is drafting revisions to gold import/export regulations to streamline cross-border handling and tighten supervision around gold carried or mailed by individuals. Tax Crackdown on Overseas Income: Authorities are tightening oversight of residents’ offshore earnings via “self-review” audits that critics see as retroactive enforcement tied to local revenue needs. US-China Tech Tension: Apple is reportedly lobbying Washington for permission to buy memory chips from a Chinese supplier blacklisted by the US, highlighting the squeeze between rising chip costs and export restrictions. EV Export Push: Chinese heavy-truck makers are accelerating electrification and overseas sales, with electric ownership costs nearing diesel parity after subsidies. Venezuela Quake Aid: Overseas Chinese in Venezuela donated about 500 tons of relief supplies for quake victims as the death toll climbs. Bangladesh Ties: Eleven Chinese firms proposed $9.21 billion in investment in Bangladesh during talks with Prime Minister Tarique Rahman, as both countries upgrade cooperation. Beijing Plane Crash: A small plane crashed into CITIC Tower in Beijing, killing the pilot and injuring 13; reports say online references were quickly scrubbed.

China-Bangladesh Diplomacy: Bangladesh’s foreign minister says ties with China have reached the highest level, with leaders agreeing to build a “community with a shared future,” alongside new cooperation plans on water management, flood prevention, and river tech. US-China Tech Clash: Apple is reportedly lobbying the Trump administration to get approval to buy memory chips from CXMT, a Chinese supplier on a Pentagon military blacklist, as the global memory crunch squeezes prices. Beijing Aviation Shock: A small plane crashed into Beijing’s CITIC Tower (China Zun), killing the pilot and injuring 13, while questions swirl after limited early public details. Fusion Milestone: China’s “artificial sun” program says two key superconducting magnets for a fusion reactor have passed full testing with 100% domestic production. Central Bank Gold Rush: A new report highlights record central bank gold buying since 1975, driven by reserve needs and market stress planning. PLA Anti-Corruption Update: China removed six PLA officers and other senior figures from posts in the National People’s Congress amid Xi’s crackdown. AI in Education: Reports say AI smart glasses are being used to cheat on exams, pushing schools to tighten controls. China-Russia Education Links: A photo exhibition in Moscow spotlights expanding China-Russia educational exchanges. China-New Zealand Film: A Beijing film carnival kicks off to deepen cooperation in film, tech, and cultural tourism. China-Afghanistan Business: An Afghan commerce delegation met Afghan traders in China and discussed hurdles for the private sector.

Tibet Rights Under Pressure: A coalition of 151 Tibetan groups urged foreign ministers in 14 democracies and the EU to oppose China’s new Law on Promoting Ethnic Unity and Progress, saying it will enable forced assimilation by restricting Tibetan language, curbing religion, and penalizing peaceful identity. Beijing Anti-Corruption Shake-Up: China’s legislature removed six military lawmakers plus former financial regulator Li Yunze and Politburo member Ma Xingrui from posts, signaling Xi-era purges continue. Tech Under Sanctions Stress: Apple is lobbying the Trump administration to get approval to buy memory chips from ChangXin Memory Technologies, blacklisted by the Pentagon—highlighting how AI-driven chip demand collides with U.S. restrictions. AI Race, China Style: DeepSeek says it will at least double its workforce after a major funding round, aiming to compete on lower-cost models and broader adoption. China-EU Trade Tension: A China-EU policy debate warns “China Shock 2.0” rhetoric is politicizing trade, as Brussels weighs industrial firewalls against calls for predictable rules. Local Governance & Money: China’s audit found 56 county-level governments diverted about 27.9 billion yuan from rural programs to repay debt and cover other spending. Beijing Security Alarm: A small plane crash into CITIC Tower in Beijing’s CBD has sparked questions about airspace control and defenses. Regional Diplomacy: China and Cambodia vowed to deepen “ironclad” friendship and strategic cooperation as Wang Yi met senior Cambodian leaders in Beijing.

US-China Tech & Influence: US lawmakers warned of an “epic campaign” by the CCP to infiltrate local governments and steal technology, pointing to the Arcadia, California mayor case as an “alarm bell.” China’s Fiscal Oversight: A national audit says nearly 28 billion yuan in rural funds were misused, often to plug local debt and support state firms. Youth Drug Crackdown: China’s top court flagged a surge in youth drug abuse via “heady” e-cigarettes containing etomidate. Beijing Water Reality Check: North China’s rising water table is reviving springs after years of drought, but it’s also triggering basement flooding, subway leaks, and contamination risks. AI Power Race: China is testing “computing-power synergy,” including an underwater data center in Shanghai’s Lingang area, as AI demand drives sharp power growth. Housing Demand Push: Guangzhou raised housing provident fund loan limits to spur home sales, while analysis notes a growing mismatch between contributions and outstanding loans. Bangladesh Pivot to Beijing: PM Tarique Rahman’s China trip produced 17 MoUs and a new push for a “China-Bangladesh community with a shared future,” including Teesta river support and deeper connectivity. EU Auto Pressure: Reports say the European Commission is preparing anti-subsidy tariffs on Chinese plug-in hybrids, even as Chinese exports to Europe surged and market share hit new highs. Cambodia Partnership: Xi met Cambodia’s Hun Sen, reaffirming “ironclad” ties and expanded cooperation in infrastructure, clean energy, and digital tech. Global Trade Signals: China’s yuan is gaining ground in global finance as more countries expand RMB clearing and issue yuan-linked debt.

Taiwan Tensions: Taiwan says it detected fresh Chinese military sorties and naval vessels around the island, with aircraft entering its southwestern ADIZ as Beijing’s new ethnic unity law raises fears of wider reach. Ethnic Unity Law: China’s justice ministry defended the law’s clause allowing overseas accountability for acts deemed to undermine ethnic unity, rejecting claims it amounts to extraterritorial “long-arm” jurisdiction. Global Order Pitch: Beijing’s 36-page white paper on “more just and equitable global governance” lays out how China wants to shape the future international system. Banking Crackdown: China’s top auditor says major state banks have committed tax evasion and lending violations, as Beijing tightens enforcement amid local government revenue stress. Hong Kong Pressure: New rules aimed at capital flight are starting to hit Hong Kong’s offshore wealth business, with penalties and tighter scrutiny of banks and wealth structures. Energy Push: China says it has crossed 4,000 GW of installed power capacity, with non-fossil sources now the majority. Bangladesh Visit: PM Tarique Rahman meets Xi Jinping in Beijing after paying tribute at Tiananmen Square, with multiple cooperation MoUs on the agenda. AI in Finance: China’s financial regulator issues new AI governance rules for insurance and banking, demanding compliance, transparency, and effective management. Tech Spotlight: Zhipu AI’s GLM-5.2 is being hailed as a “DeepSeek moment” for affordable, reliable coding.

Cybersecurity: 360 Security Technology unveiled “Yitian Tulong” at ISC.AI in Beijing, pitching Tulongfeng as a “Chinese Mythos” for vulnerability discovery and Yitianzhen to automate defense and incident response. AI hiring & markets: DeepSeek says it will at least double teams via 33 openings, while Zhipu AI weighs a Hong Kong share sale and also plans a Shanghai placement to fund new models. Diplomacy: China’s Wang Yi met Austria’s foreign minister in Beijing, stressing UN coordination and “opportunities” for Europe; in parallel, Bangladesh PM Tarique Rahman is set to meet Xi after signing 13 MoUs in Beijing. Trade & development: China urged Zimbabwe to use its zero-tariff policy by investing in integrated industrial parks; Zimbabwe also discussed mineral-backed loans with China for roads and rail. Regional connectivity: Malaysia expanded flights linking Kuala Lumpur with Chinese cities and Indonesia via new Hainan Airlines, China Eastern, Wings Air and AirAsia routes. Finance & commodities: China tightened retail gold trading as banks curbed access to the Shanghai Gold Exchange amid volatility. Energy & climate: China’s 15th Five-Year Plan highlights a push for a cleaner power mix and a “Beautiful China” green transition. Security & geopolitics: A new China-Eurasia Expo opened in Urumqi with Afghan participation, while reports also point to intensifying military competition.

Banking & Markets: ICBC and other major lenders are tightening or halting individual precious-metals agency trading tied to the Shanghai Gold Exchange, as gold volatility and margin risks rise. Monetary Policy: China’s central bank will debut overnight reverse-repos next week to better manage short-term liquidity around month-end. Financial Oversight: China’s top auditor flagged tax evasion and improper lending at large state-backed banks, including Bank of China. Trade & Industry: The WTO agreed to set up a panel on China’s challenge to India’s solar manufacturing measures. Geopolitics & Security: A new wave of “salami-slicing” maritime activity by Chinese vessels is raising alarms in the Taiwan region. Tech & Research: Peking University’s legal database launched an AI tool for statute retrieval and contract drafting, aiming to reduce hallucinations. Space & Telecom: China’s SpaceSail is positioning a few-hundred-satellite system as a Starlink challenger. Energy & Climate: Chimbusco signed for 6,000 tons of green methanol for marine fuel, while experts push back on overly optimistic climate projections for China. International Politics: BNP and China’s Communist Party signed their first party-to-party MoU in Beijing.