China’s factory-activity growth slows as recovery remains bumpy, Caixin PMI shows

By Reuters

China’s factory activity grew in December, but at a slower-than-expected pace, as overall sales were dampened by falling export orders amid concerns over the trade outlook, a private-sector survey showed on Thursday.

The data echoed an official survey on Tuesday showing that manufacturing activity expanded modestly last month, reinforcing calls for more stimulus to spur growth this year as Donald Trump will soon take office and likely intensify US-China trade tensions.

The Caixin/S&P Global manufacturing PMI nudged down to 50.5 in December from 51.5 the previous month, undershooting analysts’ forecasts in a Reuters poll of 51.7.

The rate of output expansion eased to a three-month low as growth in new orders slowed.

New export orders, in particular, returned to contractionary terrain, marking the fourth month of decline in the past five months. Subdued external economic conditions and threats of new US tariffs pose major risks for the world’s top exporter of goods.

While some Chinese exporters and their US buyers may have ramped up shipments recently in expectation of the Trump tariffs, a report published by China Beige Book suggested that the last-minute push may be waning.

“The pulling forward of trade before anticipated 2025 tariffs has ended. The only rescue in on-year terms is if Trump’s China-tariff talk is hot air,” China Beige Book said.

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South Korea police raid Muan airport over Jeju Air crash

By Reuters

South Korean police said they had raided Muan airport and the Jeju Air office on Thursday over the crash involving one of the company’s Boeing 737-800s that killed 179 people.

“In relation to the plane accident that occurred on December 29, a search and seizure operation is being conducted from 9am on January 2 at three locations,” including Muan, the Jeju Air office in Seoul, plus a regional aviation office, police said in a statement.

The operation came as South Korea’s acting president Choi Sang-mok said on Thursday immediate action must be taken if a special inspection of all Boeing 737-800 aircraft operated in the country finds any issues as authorities ramp up a probe into the crash.

The conversion of data from the Jeju Air 7C2216 cockpit voice recorder to audio file should be completed by Friday, Choi told a disaster management meeting, which could provide critical information on the final minutes of the doomed flight.

All 175 passengers and four of six crew members were killed on Sunday when the Jeju Air jet belly-landed at Muan airport in the country’s southwest and slammed into an earth-and-concrete embankment, bursting into flames.

Two crew members, located near the tail of the Boeing 737-800, survived.

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Why 2024 was the ‘most violent, dangerous’ point in Philippine-China ties, and what’s next

By Raissa Robles

The year 2024 marked the “most violent” and “most dangerous moment” for both Beijing and Manila in their long-running South China Sea dispute, according to several experts interviewed by This Week in Asia.

All of them agreed that China was the hands-down winner in gaining control over more geographical features in the contested waterway, but most added that Beijing had suffered “reputational damage” in the process.

The Philippines lost control of yet another feature – Sabina Shoal – but was able to harness multinational support and military aid to increase its defence posture in the troubled waterway, they added.

The watershed moment in the dispute occurred on June 17, “marking an unprecedented escalation” and “the most dangerous moment”, said Professor Hu Bo, director of Peking University’s Center for Maritime Strategy Studies and the South China Sea Strategic Situation Probing Initiative.

Hu said the China Coast Guard “took lawful measures” to intercept, inspect by boarding and expel six Philippine vessels that attempted to deliver supplies to BRP Sierra Madre, a crumbling Philippine warship grounded on Ayungin or Second Thomas Shoal that China calls Renai Jiao.

“Multiple collisions occurred between vessels from both sides, leading to close confrontations far exceeding the intensity of previous stand-offs, making it the most severe friction in the South China Sea in the past decade.” he posted on July 12 on the SCSPI website weeks after the clash.

“This incident generated significant attention worldwide,” Hu said.

It was “the most violent incident” between both countries in the South China Sea, leading to a Filipino sailor losing his thumb in the “physical scuffle”, said Lucio Blanco Pitlo, president of the Philippine Association for Chinese Studies.

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Tackling the problem of subdivided flats a top priority for government

By Winnie Ho Wing-yin

Housing is an issue of great public concern. Since the proposed regulatory regime on basic housing units was unveiled, local and international media have shown significant interest in this issue. Since taking office, the current government has introduced various measures to substantially increase public housing supply in Hong Kong by enhancing quantity, speed, efficiency and quality.

Coupled with some 30,000 units of light public housing under construction now and to be completed by 2026-27, the total public housing supply in the coming five years will reach 189,000 units, about 80 per cent higher than that of the previous five-year period (2022-23 to 2026-27).

In addition, around 18,000 transitional housing units have already been completed and are in operation, with the remaining 3,000 units expected to be completed in 2025 to plug the short-term supply gap.

The increase in public housing supply does more than enable eligible households to find places in public housing more quickly with improved living conditions. It also helps the government tackle the long-standing issue of subdivided units, especially given that about 40 per cent of the roughly 110,000 households in subdivided units are applying for public rental housing.

Under the proposed regulatory regime on basic housing units that Chief Executive John Lee Ka-chiu announced in his latest policy address, only up-to-standard subdivided units, with confirmation by professionals and recognised as basic housing units, will be allowed to be rented out in future. Otherwise, there would be criminal liability on the part of landlords to rent out substandard subdivided units, while the tenants concerned would not be held liable.

Currently, there are about 220,000 residents living in subdivided units. The condition of these units varies greatly, from very poor conditions without separation of the toilet and bedroom to some quite decent ones with proper toilet, cooking area and opening windows. Some are even fully furnished and renovated to meet the needs of working people and university students for easier access to work or school, as well as various social demands arising from special family needs.

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China’s military warns that AI cannot replace human decision-making on battlefield

By Enoch Wong

China’s military has warned that artificial intelligence cannot replace human decision-making on the battlefield because it lacks self-awareness.

“AI must work in tandem with human decision-makers to optimise command effectiveness, enhancing rather than replacing human agency,” an article published in People’s Liberation Army Daily on New Year’s Eve said.

The article says AI can be used to augment human capabilities – through data analysis, simulations or planning – but cannot replace them.

“As AI evolves, it must remain a tool guided by human judgment, ensuring accountability, creativity, and strategic adaptability remain at the forefront of military decision-making,” the article said.

The article said human autonomy and creativity are indispensable on the battlefield. It added that while human commanders can respond to situations dynamically, and exploit enemy weaknesses, AI operates within predefined algorithmic boundaries and its responses often lack originality.

The PLA said it preferred a model where “humans plan and AI executes” in which the technology is used to carry out the strategies and tactics developed by commanders and keeps an element of human oversight.

It said it prefers a structure where machines analyse data, provide insights and suggest potential actions. However, “final decisions rest with human commanders, safeguarding against errors stemming from AI’s black-box nature”.

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Nowhere to go but up: China’s farming drones take root as industry grows

By Mandy Zuo

When Wang Fei started his agricultural drone company five years ago, the distinctive whirr of the autonomous vehicles went practically unheard over the wide swathes of farmland in his home county of Anlu.

A former sales manager for agricultural machines in the western hub of Chengdu, Wang said at the time he saw “great prospects” for the potential applications of drone technology before returning home to see those prospects out.

Now, Chufei Agriculture’s services cover about 40 per cent of the farmland in Anlu. With unmanned aerial vehicles (UAVs) sowing seeds or spraying pesticides and fertilisers, yields are up for the central Chinese county and its population of about 487,000.

Wang’s success story is one of many unfolding as the pace of technological change in China ramps up. Its near-universal adoption of agriculture drones has sent the country to the top of global charts in terms of total operation area – and raised concerns in the United States over the devices’ ubiquity on American farms.

In the past year, a world-leading fleet of 251,000 spraying drones covered an aggregate 2.67 billion mu (178 million hectares) in China, according to data from the National Agro-tech Extension and Service Centre. Both figures increased nearly 25 per cent compared with 2023.

As China begins to look to what it terms the “low-altitude economy” – airborne economic activity within a range of 1 kilometre (0.6 miles) above ground – as a source of future growth, farm drones have been frequently mentioned as a pioneering innovation.

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Virgin Australia flight crew members allegedly raped, robbed in Fiji

By Reuters

Fiji police said on Thursday they were investigating an incident involving two crew members of Australian airline Virgin Australia who were allegedly victims of rape and theft in Nadi in the early hours of New Year’s Day.

The crew members were in the popular tourist destination on a layover before they were supposed to fly off the following day, Acting Commissioner of Police Juki Fong Chew said in a statement.

Virgin, which said it was aware of the incident, has sent people to Fiji to provide support. It did not provide further details of the incident in a statement to Reuters.

Fiji police said the investigation so far had found some Virgin crew members had gone to a nightclub in Nadi.

“Unfortunately, two of the crew members were victims of an alleged theft and rape after exiting the nightclub trying to find their way back to the hotel,” said Chew, adding that the investigation is continuing.

The South Pacific island nation of Fiji is a popular tourist destination and received 76,845 visitors in the month of November, mostly from Australia, New Zealand and North America, according to the country’s tourism website.

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Hong Kong’s deficit: analysts offer fixes for city’s snowballing debt

By Cannix YauOscar Liu

Hong Kong can address its multibillion-dollar deficit by issuing bonds, taxing non-locals on digital activities, casting a wider tax net and breaking down land parcel sales into smaller pieces to attract investors, analysts have said.

With Hong Kong’s deficit snowballing to about HK$100 billion (US$12.8 billion) in the 2024-25 financial year, industry leaders have been racing to offer solutions to help the government boost income and rein in expenses.

The Hong Kong General Chamber of Commerce, the city’s largest business chamber, urged the government to explore new revenue streams to achieve a fiscal balance and fund important infrastructure projects that would bring long-term benefits.

“We hope the economy will pick up with the Hong Kong government and mainland’s efforts to stimulate growth, but this will take time. The government can try to tighten its belt, but we are in favour of investing for our future,” CEO Patrick Yeung Wai-tim said.

The chamber advised authorities to raise revenue by issuing bonds to finance long-term investments and taxing non-local digital service suppliers.

“We would recommend that the government use bond issuance to fund long-term investments rather than recurrent expenditure,” it said.

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Meghan, Duchess of Sussex, is back on Instagram with moody video post

By Associated Press

Meghan, the Duchess of Sussex, started the new year with her first Instagram account since 2020.

Her first post is a black and white video of herself at the beach, wearing white and drawing 2025 in the sand on an overcast day. The @meghan account already has nearly 500,000 followers.

Meghan and Prince Harry, the Duke of Sussex, were married in 2018, and were initially part of @KensingtonRoyal, which also included Harry’s brother, Prince William, and his wife, Kate, the Princess of Wales.

But a year later, Meghan and Harry launched their own account, @SussexRoyal, a sign of their growing distance from the royal family. @SussexRoyal was discontinued in 2020, around the time that Meghan and Harry announced they were stepping back from their official roles.

Meghan, who had a popular Instagram account when she was best known for her role in TV drama Suits, had indicated she would return. In a 2022 interview with New York Magazine’s The Cut, she confided: “Do you want to know a secret? I’m getting back … on Instagram.”

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Why would China want a blockade on Japanese islands? Recent drill raises Taiwan spectre

By Julian Ryall

A fleet of Chinese navy vessels has conducted what Japanese military analysts believe was an exercise to impose a naval blockade between the main island of Okinawa and the most westerly islands of the prefecture, isolating them as part of Beijing’s plans to take control of Taiwan.

Quoting multiple Japanese government sources, the Yomiuri newspaper reported on Wednesday that six Chinese ships – including a Jiangkai Class 1 frigate and three coastguard vessels – sailed around the southern tip of Taiwan before passing from the Pacific through the Miyako Strait and into the East China Sea on December 22.

The joint operation between the navy and armed coastguard vessels was the first in the 250km strait that separates Okinawa island and Miyako and an archipelago of smaller islands that ends with Yonaguni, a little over 100km to the east of Taiwan.

A Japanese government analyst said the ships’ movements were “an unusual move that suggests a maritime blockade”.

The exercises also coincided with the continued presence of Chinese coastguard ships in waters surrounding islands in the East China Sea that Beijing claims and refers to as the Diaoyu archipelago. The uninhabited territories are part of Okinawa prefecture and are administered by Japan, which knows them as the Senkakus.

Stephen Nagy, a professor of politics and international relations at Tokyo’s International Christian University, suggested the move could be “part of China’s broader strategy to take Taiwan without a fight”.

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US Army veteran suspected of deadly New Orleans truck attack was ‘born and raised’ in Texas

By Reuters

Shamsud-Din Jabbar, the 42-year-old Texas man accused of crashing a truck into New Year’s Day revellers in New Orleans, killing 15 and injuring dozens of people, served in the US Army for 13 years including a deployment to Afghanistan, the Army said.

Federal officials and local law enforcement in New Orleans said that Jabbar did not act alone and that they are looking for accomplices.

The FBI said Jabbar had an Islamic State flag on his truck and view the attack as a potential act of terrorism. The Islamic State, or Isis, is a Sunni Muslim militant group that has carried out attacks throughout the world.

While the investigation is ongoing, so far no information has surfaced to explain why Jabbar, a US citizen raised in Texas, would carry out the New Orleans attack. Jabbar died at the scene in a shoot-out with police, officials said.

Jabbar served in the US Army as a human resource specialist and information technology specialist from 2007 until 2015. He then joined the Army Reserve as an IT Specialist until 2020, holding the rank of staff sergeant at the end of service, according to an Army official.

Jabbar deployed to Afghanistan from February 2009 to January 2010, the official said.

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Why mainland China’s Taiwan integration experiment in Fujian is starting to fizzle

By Amber Wang

Fujian province has become a test bed for mainland China’s push for economic, social and political integration with Taiwan. In this story – the first in a four-part on-the-ground series – Amber Wang details the 15-year integration drive in Fujian’s Pingtan county, which appears to be losing steam as the mainland economy falters, military tensions grow and Beijing struggles to turn cross-strait business ties into political loyalty.

For Allen Xue, a Taiwanese woman, the allure of moving just across the Taiwan Strait to the coastal county of Pingtan on the mainland was hard to resist.

Earlier this year, she settled into a compound specifically tailored for Taiwanese and bought it at a price far below market value.

Many decades ago, Pingtan, located just 110km (68 miles) from Taiwan in Fujian province, was a collection of underdeveloped fishing towns that served as a base for mainland Chinese attempting to illegally enter Taiwan.

Much has changed since then. Around 15 years ago, the county became a test site for economic, social and political integration with Taiwan. Business and infrastructure boomed as Beijing invested billions into building links across the strait.

However, the integration drive seems to be losing steam after its initial progress as the mainland’s economy stumbles and cross-strait tensions grow, according to Taiwanese residents of Fujian and Beijing policy advisers interviewed by the South China Morning Post.

While some Taiwanese businesses have taken advantage of the scheme, the plan has not succeeded in fostering deep cross-strait economic ties or political loyalty towards Beijing.

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Dialogue can help China, India sidestep disputes over mega dam

By Genevieve Donnellon-May

On Christmas Day, China formally approved a controversial 60-gigawatt “super dam” project in the Tibet autonomous region, on the Yarlung Tsangpo River, the upper section of the transboundary Brahmaputra.

The ambitious hydropower project, first announced in November 2020, is expected to surpass 1 trillion yuan (US$137 billion) in investment. Included in China’s 14th five-year plan (2021-2025), the dam is part of plans for China to achieve carbon neutrality by 2060 and could generate three times more energy than the Three Gorges Dam.

Although the start date and exact location remain unclear, media reports from late 2020 suggested the dam could be built near the “Great Bend” close to the China-India border. This has sparked considerable alarm in downstream India. While the Chinese foreign ministry has pledged to maintain dialogue with downstream nations and step up cooperation on disaster prevention, amid Sino-Indian tensions, New Delhi remains wary about the mega dam’s impact on the Brahmaputra’s flow.

The Yarlung Tsangpo-Brahmaputra is one of the world’s largest transnational rivers and vital to the livelihoods of millions across China, India, Bangladesh and Bhutan. Originating in southwest China’s Qinghai-Tibet Plateau, it flows through southern Tibet, crossing the Himalayas into India (where it is called the Brahmaputra), before entering Bangladesh.

The official go-ahead for the mega dam adds to India’s concerns over China’s large-scale engineering projects on shared rivers like the Brahmaputra, and underscores the complexities of Sino-Indian river governance.

The Brahmaputra is central to the socioeconomic development of both countries. For India, the river contributes nearly 30 per cent of the country’s freshwater resources and 40 per cent of its hydropower potential. The river plays a smaller role in China’s freshwater supply but is vital to Tibet’s agricultural and energy sectors.

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Vehicle catches fire and explodes outside Donald Trump’s hotel in Las Vegas

By Associated Press

A vehicle caught fire and exploded on Wednesday outside the lobby of US president-elect Donald Trump’s hotel in Las Vegas, authorities said.

Las Vegas police said they are investigating the fire and explosion, but neither they nor the Clark County Fire Department immediately provided more details. A county spokeswoman said in a statement that the fire was in the hotel’s valet area and was reported at 8.40am.

Eric Trump, a son of the president-elect and executive vice-president of the Trump Organization, posted about the fire on social media. He praised the fire department and local law enforcement “for their swift response and professionalism”.

The 64-story hotel is just off the famed Las Vegas Strip and across the street from the Fashion Show Las Vegas shopping centre.

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US man had 150 home-made bombs, allegedly used Joe Biden’s photos for target practice

By Associated Press

Federal agents found one of the largest stockpiles of home-made explosives they have ever seized when they arrested a Virginia man on a firearms charge last month, according to a court filing by federal prosecutors.

Investigators seized more than 150 pipe bombs and other home-made devices when they searched the home of Brad Spafford northwest of Norfolk in December, the prosecutors said in a motion filed Monday. The prosecutors wrote that this is believed to be “the largest seizure by number of finished explosive devices in FBI history”.

Most of the bombs were found in a detached garage at the home in Isle of Wight County, along with tools and bomb-making materials including fuses and pieces of plastic pipe, according to court documents.

The prosecutors also wrote: “Several additional apparent pipe bombs were found in a backpack in the home’s bedroom, completely unsecured” in the home he shares with his wife and two young children.

Spafford, 36, was charged with possession of a firearm in violation of the National Firearms Act. Law enforcement officers allege he owned an unregistered short barrel rifle. Prosecutors said that he faces “numerous additional potential charges” related to the explosives.

Defence lawyers argued in a motion on Tuesday that authorities have not produced evidence that he was planning violence, also noting that he has no criminal record. Further, they question whether the explosive devices were usable because “professionally trained explosive technicians had to rig the devices to explode them”.

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3 arrested at Hong Kong airport over drugs worth HK$9 million

By Lo Hoi-ying

Hong Kong customs officers have arrested three travellers, including a man from Malaysia, for allegedly smuggling drugs in separate cases involving more than HK$9 million (US$1.16 million) at the airport.

The Customs and Excise Department said on Wednesday officers seized about 4.5kg of suspected liquid cocaine and about 12kg of suspected ketamine from the three passengers at the Hong Kong International Airport on Tuesday. The suspected drugs had a combined market value of HK$9.4 million.

Officers arrested a 32-year-old man from Malaysia during customs clearance after finding 2kg of suspected ketamine in tea leaf packaging in his carry-on suitcase.

In the second case, about 4.5kg of suspected liquid cocaine was found in the checked-in suitcase of a 26-year-old man who arrived from Sao Paulo, Brazil, via Addis Ababa, Ethiopia.

The suspected drugs were concealed in two wine bottles and three personal care products.

In the third case, a 46-year-old male passenger arriving from Paris, France, was found with about 10kg of suspected ketamine hidden in protein powder packaging inside his checked-in suitcase.

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