China to hold G20 summit this weekend

A man rides an electronic bike past a billboard for the upcoming G20 summit in Hangzhou, Zhejiang province, China, July 29, 2016. Photo: Reuters

China will hold the G20 summit in Hangzhou on September 4-5, which will be the first in the country in the eight-year history of such meetings and a hugely important diplomatic occasion for President Xi Jinping.

Hangzhou has plastered signs on lampposts and buses welcoming the G20 summit and exhorting residents to be on their best behavior. Petrol stations alongside major arteries have been hidden behind new walls. Public offices will close for a special seven-day holiday. Private businesses have been urged to do the same, even though the summit itself only runs for two days. Hangzhou residents will receive 10 billion yuan ($1.5 billion) in tourism vouchers to visit other cities in Zhejiang province (of which Hangzhou is the capital) during the G20 summit.

The city has also mobilized its masses. The mayor boasts that a 760,000-strong volunteer force stands ready to serve the G20 summit. That number seems implausibly high for the summit alone, equating to a ratio of roughly 100 volunteers for every attendee. But it might just be true, if it includes all the students and retirees who will help patrol city streets during the meetings, whether to stop people from littering and jaywalking or simply to give visitors a smiling welcome.

With days to go, polluting factories around Hangzhou have already been ordered to halt production. Just as Beijing's smog cleared up when it hosted the APEC summit, another major economic forum, in 2014, so the skies over Hangzhou have turned unusually pristine in recent days.

An opportunity for China to increase its global influence

China is hoping to cement its standing as a global power when it hosts leaders from the world's biggest economies this weekend, but suspects that the West and its allies will try to deny Beijing what it sees as its rightful place on the international stage.

Ensuring that this does not happen will be one of President Xi's priorities, and a key mark of how successful China will judge the G20 summit to be.

Beijing wants to use the meeting to lay out a broad strategy for global growth, but talks are likely to be overshadowed by arguments over everything from territorial disputes to protectionism, diplomats said.

"From where China sits, it looks like the Americans are trying to encircle them," said a senior Western envoy, describing conversations with Chinese officials ahead of the G20 summit as being dominated by the South China Sea row and an advanced US anti-missile system to be deployed in South Korea.

While China wants to make sure its highest profile event of the year goes off successfully, President Xi will be under pressure at home to ensure he is strong in the face of challenges to his authority on issues like the South China Sea, going by reports in state media.

China has already made clear that it does not want such matters overshadowing the meeting, which will be attended by President Barack Obama, Prime Minister Shinzo Abe, and other world leaders.

State media has given great play to the idea that the G20 summit is for China to show leadership in shaping global governance rules and forging ahead with sustainable global growth, with the official People's Daily saying this could be one of the G20's most fruitful ever get-togethers.

"Let's make cooperation ever higher," it wrote in a commentary last week.

But the state-run Study Times wrote in mid-August that Western countries were trying to deliberately exclude a rising China and deny it a proper voice on the world stage with schemes like the US-led Trans-Pacific Partnership.

"Trying to get back their right to global governance, they are forging a new 'sacred alliance', striving to establish new rules," the influential paper, published twice a week by the Central Party School, wrote in a G20 commentary.

"These new rules will exclude China."

Senators urge Obama to prioritize cyber crime at G20

Six US senators have urged President Obama to prioritize cyber crime at the G20 summit, according to a letter obtained by Reuters.

In the letter sent to the White House ahead of the G20 summit, Sherrod Brown, a senior Democrat on the Senate Banking Committee, and five other Democratic senators say that they want the US president to press leaders from the world's 20 biggest economies to commit in joint communiques to a "coordinated strategy to combat cyber-crime at critical financial institutions."

The letter, dated Monday, suggests that concern among US lawmakers is growing over a February incident in which hackers breached Bangladesh Bank's systems and used the SWIFT banking network to request nearly $1 billion from an account held at the Federal Reserve Bank of New York.

Some of the dozens of orders were filled, with much of the lost $81 million disappearing into Philippines casinos - prompting months of international finger-pointing, an ongoing investigation, and several requests from members of Congress for answers from the Fed and from SWIFT, the secure messaging service that banks use to transfer money around the world.

"Our financial institutions are connected in order to facilitate global commerce, but cyber criminals - whether independent or state-sponsored - imperil this international system in a way few threats have," the senators, headed by Gary Peters of Michigan, wrote in the letter to Obama.

"We strongly urge you to work with your counterparts and prioritize this discussion at the G20 leaders level in September," it said, adding that "executive leadership circles across the globe" needed to pay more attention to the risks.

Copies of the letter were also sent to Federal Reserve Chair Janet Yellen and US Treasury Secretary Jack Lew.

The White House expects G20 members at the summit "to affirm their commitment to cooperate to fight cyber crime and to enhance confidence and trust in the digital economy," a senior administration official said.

Asked generally about cyber security on Monday, White House spokesman Josh Earnest said at a press conference: "I would anticipate that this issue more generally will be on the agenda" when Obama meets Xi, the G20 summit host, later this week.

At a November summit, the G20 pledged not to conduct economically motivated cyber espionage, an agreement intended to reduce the estimated hundreds of billions of dollars worth of commercial trade secrets that are stolen by foreign governments seeking to benefit industry in their own countries.

Japan worries

Then there is Japan, a country with which China has been embroiled in disputes for much of the last decade over their wartime past and a spat over a group of uninhabited islands in the East China Sea.

Last week, China's top diplomat called on Japan to be "constructive" at the G20 summit, with the deeper fear in Beijing that Japan is angling to become involved in the South China Sea dispute as well, at the behest of its ally the US.

Wang Youming, the head of the developing countries program at the Foreign Ministry-backed China Institute of International Studies, wrote in the widely-read Chinese newspaper the Global Times that the closer G20 got, the more Japan was trying to cause trouble.

"Japan is getting entangled in the South and East China Sea issues, cozying up to the Philippines, and urging China to respect the result of the so-called 'arbitration case," Wang wrote.

"Japan is up to its old tricks, and it's hard not to think they are trying to mess things up."

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