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Taiwan Rejects China’s “One Country, Two Systems” Offer

Taiwan will not accept China’s proposal to reunify under the “one country, two systems” model and is prepared to defend its freedom and democracy, President Lai Ching-te declared on October 31, firmly rejecting Beijing’s latest attempt to bring the island under its control.

Earlier this week, China stated that it “does not rule out the use of force” against Taiwan – a remark that stands in stark contrast to the more conciliatory tone in recent state media reports, which had emphasized promises of “peaceful governance” similar to arrangements in Hong Kong and Macau.

Speaking at a military base in Hukou, President Lai addressed troops amid this politically tense backdrop, stressing that “true and lasting peace can only be secured through strength and defense readiness.”

“We must uphold the status quo with dignity and determination, firmly oppose annexation, aggression, and forced unification,” Lai said. He announced that Taiwan plans to raise defense spending to 5% of GDP by 2030 in order to strengthen its security amid China’s growing military threat.

Defending this strategy, Lai underlined that “the Taiwanese people’s protection of sovereignty and democratic way of life should not be seen as a provocation. Investing in national defense means investing in peace.” Beijing’s Taiwan Affairs Office has not yet commented on the president’s remarks.

Lai’s visit to Hukou coincided with a ceremony marking the delivery of a new battalion of M1A2T Abrams tanks, manufactured by U.S. defense company General Dynamics Land Systems. So far, Taiwan has received 80 out of 108 ordered tanks – a sign that the island remains a focal point in the intensifying U.S.-China rivalry, a confrontation that increasingly transcends regional boundaries and carries global implications.

Meanwhile, at the recent U.S.-China summit in Busan, the issue of Taiwan was conspicuously absent from public discussion. Neither Xi Jinping nor Donald Trump mentioned the topic, which may suggest a temporary, pragmatic understanding aimed at easing tensions. Yet, as Washington continues to bolster Taiwan’s defense capabilities and Beijing refuses to renounce the use of force, this diplomatic silence appears more like a strategic pause than a sign of genuine reconciliation.

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Meeting between Donald Trump and Xi Jinping in South Korea

Following the meeting held on October 30, Donald Trump announced that he would sign a trade agreement with Chinese President Xi Jinping “very soon.” The meeting also covered the topic of reducing tariffs on Chinese imports. Trump told reporters that they agreed to lower the tariff on fentanyl imports from 20% to 10%. The level of tariffs imposed on Chinese products also dropped from 57% to 47%. It is noteworthy that the parties did not discuss Taiwan during the meeting.

Despite the fact that a trade deal was not signed after the meeting, a significant consensus on economic issues was reached during the meeting, including the resolution of disagreements related to rare earths. China announced that export control measures on critical minerals should be suspended for one year. In exchange for the tariff reductions, the Chinese side will purchase an “enormous amount” of American soybeans, which is a step forward for the US, as farmers were losing billions of dollars from crop sales to China due to trade disputes.

President Xi emphasized that dialogue is better than confrontation. He called for deepening communication and named potential areas for cooperation:

  • Combating illegal immigration and telecommunication fraud
  • Money laundering
  • Artificial intelligence (AI)
  • Response to infectious diseases

The leaders also discussed the issue of Ukraine during the meeting. Trump and Xi Jinping agreed to cooperate to facilitate the end of the conflict.

The leaders agreed that they share a joint responsibility to address the complex problems facing the world.

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China’s Newest Refinery Ramps Up Russian Oil Imports Amid Sanctions

China’s newly authorized Shandong Yulong Petrochemical refinery is dramatically increasing its imports of Russian crude oil in response to supply disruptions caused by Western sanctions. The refinery, with a processing capacity of 400,000 barrels per day, is expected to import 370,000–405,000 barrels of Russian crude in November – nearly double its previous intake from Russia. 

The increase in Russian crude comes after shipments from Middle Eastern and Canadian suppliers were canceled due to sanctions imposed by the UK and the EU in October 2025. 

The surge in imports reflects a broader trend among Chinese refiners seeking alternative sources in an unstable global energy market. Analysts note that while this strategy guarantees a steady feedstock supply and cost advantages, it also exposes Yulong to potential regulatory and geopolitical risks due to ongoing sanctions on Russian energy exports.

The increased Russian oil purchases underscore China’s determination to secure energy supplies among international uncertainty. For Russia, the arrangement provides a reliable outlet for its crude. The deal also highlights the growing energy dependence between China and Russia, with long-term implications for Eurasian energy trade flows.

The move may influence regional crude pricing, as Yulong’s increased demand for Russian grades could tighten supply elsewhere in Asia. Chinese refiners are reportedly taking advantage of favorable pricing for Russian barrels, allowing them to maintain refining margins even as global oil markets remain volatile.

While the arrangement ensures Yulong’s short-term operational stability, analysts caution that reliance on Russian barrels could create vulnerabilities if sanctions expand or shipping routes are disrupted.

Author: Nia Kokhreidze 

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China gives Japan’s new prime minister Sanae Takaichi the cold shoulder

China has yet to congratulate Japan’s new prime minister nearly a week after her appointment — a departure from diplomatic precedent that underscores the strained state of relations between the two Asian powers.

Sanae Takaichi, 64, a prominent China hawk, took office on Tuesday, becoming Japan’s first female prime minister and the fifth leader in five years. She succeeded Shigeru Ishiba, who received congratulatory messages from both Chinese President Xi Jinping and Premier Li Qiang on the day he assumed office in October last year. Beijing also promptly congratulated former prime ministers Fumio Kishida in 2021 and Yoshihide Suga in 2020.

When asked on Thursday whether Beijing planned to congratulate Takaichi, Chinese foreign ministry spokesperson Guo Jiakun said, “China made proper arrangements according to diplomatic practices.” “China and Japan are close neighbors. China’s fundamental position on its relations with Japan is consistent and clear,” Guo continued. “We hope Japan and China will… honor Japan’s political commitments on major issues… uphold the political foundation of bilateral relations, and fully advance the China–Japan strategic relationship of mutual benefit.”

Analysts warn that tensions between Beijing and Tokyo may escalate under Takaichi’s administration, given her outspoken positions on Taiwan and Japan’s wartime history.

Takaichi has long advocated for prime ministerial visits to the controversial Yasukuni Shrine, which honors Japan’s war dead — including convicted war criminals — and remains a flashpoint for Chinese anger over Japan’s 1931 invasion and occupation of China and the atrocities committed by its forces.

Her engagement with Taiwanese officials has also drawn criticism from Beijing. In April, Takaichi met Taiwanese President William Lai Ching-te in Taipei, calling for closer defense cooperation to “maintain our security guarantees.” She also met Taiwan’s Foreign Minister Lin Chia-lung in Japan in July.

Relations between China and Japan have long been marred by territorial disputes, historical grievances, and Japan’s security alignment with Washington. Despite recent efforts to expand economic cooperation and promote people-to-people exchanges, ties remain fraught — particularly on defense matters.

Those tensions are likely to deepen, as Takaichi pledged in her first policy speech on Friday to accelerate Japan’s defense spending targets by two years. The Chinese foreign ministry criticized the move, saying it heightened regional concerns about Japan’s security trajectory.

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Trump plans a “fantastic deal” with China while meeting President Xi

At the end of this month, the 2025 Asia-Pacific Economic Cooperation summit is scheduled to be held in South Korea, where leaders of member countries will gather to discuss global economic issues. Amid the complicated relations and trade war between China and the U.S., the President of the United States, Donald Trump, announced he hopes to meet with Xi and reach a “fantastic deal” with China. He offered to lower tariffs but also noted that China should make concessions too, including buying U.S.-produced soybeans and ending restrictions on rare earth minerals. These two factors—China halting U.S. soybeans imports and its near-monopoly on rare earth minerals—are powerful tools for China and could put significant pressure on Trump to lower tariffs and attempt to strike a deal with Beijing. 

For U.S. farmers, it is nearly impossible to find a replacement for the enormous Chinese demand, as China is the world’s largest importer of soybeans and the largest customer of U.S. farmers. For example, last year China exported half of the U.S.-produced soybeans, which amounts to $12.6 billion. But this year, as a retaliation to U.S.-imposed tariffs, Chinese purchase of soybeans has declined significantly, which dramatically affected U.S farmers, who in turn lobby Trump to change his policies toward China. On the other hand, while American farmers are desperate, China has found an alternative supplier – Brazil. In August, China purchased $ 4.7 billion in soybeans from Brazil, which, compared to the U.S supply, is around fifty times larger. This situation puts China in an advantageous position – it pressures the U.S agricultural sector and also deepens “south-south cooperation”.

Besides the soybean problem, which may only affect U.S farmers, there’s the issue of rare earth minerals, which is a huge problem not only for the U.S but for the global economy and manufacturing of a wide range of electronics, from iPhones to electric cars and etc. China controls more than 90% of the global output of refined rare earths. So, the upcoming summit and talks between the U.S and China are an important event for the global economy. This trade war has damaged both countries and their economies, and the deal between them will indeed be “fantastic”, as Trump said, but considering Trump’s unpredictable decisions, it’s hard to say what will actually happen.

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Global Leaders’ Meeting on Women in Beijing

On October 13-14, 2025, China, as co-host, assumed the role of a global leader in gender equality by holding a High-Level Meeting on Women’s Rights in Beijing. President Xi Jinping underscored the necessity of women’s active participation both in politics and at all levels of decision-making. According to him, countries must open the path for women in matters of state governance. Although China has achieved excellent results in the field of women’s education (for example, women comprise half of the students in higher education institutions), the quantitative scarcity of women in leadership positions raises serious questions. In response to this, the UN already called on China in 2023 to introduce legislative quotas. This appeal became particularly relevant after 2022, for the first time in 20 years, when not a single female official was represented in the country’s highest governing bodies—the Politburo and its Standing Committee.

President Xi Jinping announced new financial commitments from China aimed at safeguarding women’s rights and strengthening their positions. He stated that China will contribute an additional US$10 million to UN Women. Furthermore, China will earmark US$100 million from the Global Development and South-South Cooperation Fund, which will be used in collaboration with international organizations for projects promoting women’s rights and the improvement of their social status.

Chinese President Xi Jinping actively used the summit’s diplomatic platform to strengthen bilateral ties. On October 13–14, 2025, he held bilateral meetings with the leaders of several states—namely, Iceland, Ghana, Dominica, Mozambique, and Sri Lanka. Within the context of these meetings, on October 14, 2025, President Xi Jinping spoke with Icelandic President Halla Tómasdóttir. The main message of the dialogue was the demonstration that even countries with different social systems can engage in successful and mutually beneficial cooperation. During the meeting with the Icelandic President, emphasis was placed on the desire to deepen bilateral relations.

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Stock prices in the Asia-Pacific region fell amid the US-China tariff war

In the Asia-Pacific region, the value of major stock exchanges fell due to Trump’s threat to impose triple-digit tariffs on Chinese imports. China holds reserves of strategically important rare minerals, which also underpin its global dominance. Although trade negotiations between the two countries had made progress over the summer, Beijing’s decision to tighten export controls on these minerals was prompted by the US decision to implement new export restrictions against China.

The new trade restrictions imposed by China, which will take effect in November, will impact the economies of East Asian countries, particularly Japan, South Korea, and Taiwan. Each of these countries plays a fundamental role in the production of cutting-edge artificial intelligence and technology products. Washington actively uses economic pressure as a lever of geopolitical influence. Accordingly, in response to Beijing, Trump’s decision will impose an additional 100 percent tariff on Chinese goods, raising the total duty to 130 percent. Effectively, the US is declaring a trade embargo on China, as Chinese goods will be unable to enter the American market.

Amid prolonged trade tensions, US stock exchanges were also affected. After the S&P 500 and Nasdaq experienced their sharpest declines, Trump wrote on Trust Social that the US “wants to help China, not hurt it.” “Don’t worry about China, it will be all fine!”  Following Trump’s comments, the US stock market improved on Sunday evening.

On Sunday, Beijing warned the United States. According to a statement released by the Ministry of Commerce, China’s position remains unchanged: “We do not want a tariff war, but we are not afraid of it either”.

The next wave of counter-response trade restrictions will erase the progress achieved during the months of meetings between Chinese and US officials. At this time, it is unclear whether Trump will actually implement the tariff threat by November 1 or if the situation will be resolved.

On Sunday, speaking to journalists aboard Air Force 1, Trump said, “Let’s see what happens”, when asked about the November 1 deadline. In the Fox News program The Sunday Briefing, US Trade Representative jamieson greer said that the United States was unaware of China’s motives and did not expect the export restrictions, although Chinese officials stated that regional and national-level notifications had been made.

At the same time, Vice President JD Vance urged China to “choose the path of reason,” while emphasizing that the US holds “far more cards” if Beijing chooses to respond aggressively. As a result, a counter-response is likely, making it much harder for the two countries to find common ground and maintain economic stability.

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China Introduces New Port Fees on U.S

China’s Ministry of Transport has announced that vessels owned or registered by U.S. companies, organizations, and individuals will be subject to additional port fees starting October 14. The measure, approved by the State Council, is widely seen as a geopolitical counterreaction to trade policies pursued by the Trump administration.

The decision comes shortly after the United States imposed new tariffs on Chinese goods — a move that Beijing has condemned as unfair economic pressure. Washington’s step is closely tied to China’s export control measures aimed at limiting the sale of strategic materials, such as rare metals and minerals, essential for high-tech industries. Western analysts have described China’s restrictions as an attempt to disrupt U.S. supply chains that heavily depend on Chinese raw materials. 

In this context, China’s plan to gradually raise port fees between 2025 and 2028 — from 400 to 1,120 yuan per ton — reflects Beijing’s long-term strategy. On one hand, it mirrors U.S. tariffs with a symmetrical response; on the other, it preserves policy flexibility, allowing the government to adjust both the rate and scope of the fees as needed. 

The administrative framework of the new fee is also notable. The charge will increase with each ship’s first annual entry and will apply no more than five times per year — a structure designed to limit disruptions in international shipping and avoid destabilizing global trade networks. 

China’s Ministry of Transport added that the country will continue to take reciprocal actions within the framework of law, a diplomatically phrased warning that signals Beijing’s readiness for further economic countermeasures if necessary.

According to the analytical firm Linerlytica, Chinese shipping operators active in the U.S. market could face around $1.15 billion in fees in the first year alone, compared to just $180 million for U.S. companies — highlighting the asymmetry in tariff impacts that China aims to offset with proportional measures. 

Meanwhile, the China Shipowners’ Association has urged the government to adopt tougher steps, including imposing additional charges on foreign vessels and implementing targeted counterreactions if required.

Data from Alphaliner shows that by 2026, U.S. tariffs will cost the world’s leading shipping companies roughly $3.2 billion, with China’s state-owned COSCO Group expected to be among the hardest hit due to its extensive fleet operating between China and the United States.

The issue is expected to be a key topic during the upcoming meeting between U.S. President Donald Trump and Chinese leader Xi Jinping later this month. Experts predict that the escalating port fee dispute will mark a new phase in trade relations, where economic measures increasingly evolve into geopolitical instruments.

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China tightens rare-earth export controls

China has announced a significant expansion of export controls over 12 rare-earth materials after adding five more materials: holmium, erbium, thulium, europium, and ytterbium to the existing list of restricted ones and related technologies targeting foreign defense, military, and semiconductor users. These measures, which build on stricter rules introduced in April, have already disrupted global supply chains. The law was adopted on October 9, 2025.

The new rules include outright license denials for overseas defense users. Exports of recycling equipment and magnet production technologies will require official licenses.

Rare-earth elements are used not only in everyday electronics but also in military equipment, from smartphones to fighter jets. They are also critical for semiconductor manufacturing. The law for advanced semiconductor applications requires review on a case-by-case basis. New restrictions prohibit locally based firms from collaborating abroad on rare earth-related processes without official approval. Some of the new rules are already in effect, while others are scheduled to begin on December 1.

China dominates the processing stage of the rare-earth, controlling 90% of global rare-earth output and magnet production. Rare-earth is critical to many high-tech and defense agencies. These restrictions give China significant leverage in global trade, especially in its negotiations with the U.S. This move is more alarming given the fact that it was adopted before the U.S.-China leaders’ meeting at the Asia-Pacific Economic Cooperation summit in South Korea, which should be held in a few months. The commerce ministry stated that the restrictions aim to “safeguard national security and interests” by preventing materials from “being used, directly or indirectly, in military and other sensitive fields.”

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China and Malaysia to hold “Peace and Friendship-2025” joint exercise

The armed forces of China and Malaysia will resume the series of joint exercises from the middle of October 2025. According to the Chinese Ministry of National Defense, the program, named “Peace and Friendship-2025”, will be held in Malaysia and its adjacent waters.

Within the framework of this project, the history of military cooperation between China and Malaysia began in 2014. The exercises were primarily focused on joint search and rescue and humanitarian aid.

In 2018, the 4th “Peace and Friendship” initiative was conducted in an expanded format, where, in addition to China and Malaysia, Thailand was also involved in the training. In 2023, the program expanded even further, as Cambodia, Laos, and Vietnam also participated in the joint exercises.

The exercises are usually focused on non-warfare operations (Military Operations Other Than War – MOOTW), for example, humanitarian assistance, disaster relief, and counter-terrorism.

It is important that other ASEAN member states will also be invited as observers to the announced 6th “Peace and Friendship” initiative.

The initiative aims to strengthen practical cooperation between the militaries of China and Southeast Asian nations, improve their ability to jointly respond to non-traditional security threats, and maintain regional peace and stability.

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