China

1. Beijing’s oil dominance
2. China ups naval push
3. Xi leans on key aide
4. A new investment titan
5. Huawei challenges Nvidia
6. Top scientists pick China
7. Russia turns to EVs
8. Wall Street’s revival
9. Western brands’ struggle
10. Photographers in demand

We watch the China watchers, and follow an influencer duo’s pivot.

China has long been a nation of techno-optimists, and not just because software and engineering — from smartphones to high-speed trains to drone deliveries — have radically improved life across the country in the span of a single generation.

Faith in technology as a force for progress is embedded deeply in modern Chinese culture; the Communist Party itself traces its origins to an early 20th-century political movement led by students and intellectuals who saw the cure to the country’s chronic weakness and backwardness as “Mr. Science” (and, ironically, “Mr. Democracy”).

This is why the collective bout of anxiety in China over AI is such a big deal.

For the first time in living memory, the arrival of a new technology has inspired apprehension, rather than unrestrained enthusiasm.

As in the US, Chinese workers fret about AI-induced layoffs. Indeed, the country has already witnessed scattered outbursts of AI-related labor unrest; in one episode, taxi drivers in the central industrial city of Wuhan protested the rollout of autonomous taxis by repeatedly hailing and then cancelling rides, paralyzing the system.

But concerns over AI strike a deeper nerve within Chinese society: In a country of strivers, AI is feeding a morbid obsession with being left behind.

A desperate attempt to keep up with the latest advances in AI is adding to psychological stresses on citizens in a hyper-competitive society where kids bury themselves in books for make-or-break high school exams, where tech workers routinely put in 72-hour workweeks, and where entrepreneurship is a Darwinian struggle for survival. Rui Ma, the founder of Tech Buzz China, an independent research and advisory firm, told me it’s not a question of FOMO — Fear of Missing Out — but what she calls FOBO: Fear of Being Obsolete.

Iran strikes tankers in Hormuz

US officials said Iran had struck two tankers traversing the Strait of Hormuz, testing a ceasefire that has helped almost halve oil prices from their recent April peak. While some Gulf countries have ramped up oil shipments to near pre-Iran war levels — Saudi Arabia has exported 34 million barrels since the June 17 ceasefire — experts suggest the flow of oil through the strait may never fully recover. Meanwhile, exporters will be hoping that China, by far their biggest buyer, will replenish its stockpile and lift crude prices, underscoring Beijing’s growing clout over the global oil market. However, the country’s rapid rollout of green energy means future demand will likely fall. “China giveth and China taketh away,” Bloomberg’s Javier Blas wrote.

Beijing expands maritime influence

A Chinese long-range missile test in the Pacific that prompted protests from neighbors is part of Beijing’s efforts to assert maritime influence further from its shores and could potentially fuel a regional arms race, experts said. Australia, Japan, and New Zealand expressed alarm at Monday’s test, which appeared to be a nuclear-capable missile launched from a submarine; the US believes China is expanding its nuclear arsenal to prepare for a potential invasion of Taiwan. Beijing on Saturday launched a new patrol off Taiwan’s coast, and announced plans to conduct ​joint patrols with Russia in “relevant areas” of the Pacific. The timing — on the eve of a key NATO summit — “will heighten regional fears about China’s growing firepower and America’s capacity to protect its allies,” The Economist wrote.

Xi prepares to extend iron rule

As Chinese leader Xi Jinping prepares to extend his reign for another five years, he is grappling with a challenge faced by most autocrats: finding loyal subordinates to staff his administration. To resolve this, Xi is turning to his most trusted aide — Cai Qi, a tall silver-haired figure constantly at his shoulder, The New York Times wrote. Cai’s most pressing task is to refill the Communist Party’s 200-strong Central Committee, more than two-thirds of whose members are due to retire next year. Even as Xi lays “the groundwork to rule indefinitely,” he risks the same fate as Mao Zedong and Joseph Stalin, whose deaths in office triggered power struggles that “ended up unraveling their political visions,” The Wall Street Journal argued.

China is world’s biggest investor

The US is the world’s largest economy, but China is the world’s biggest investor, according to a new McKinsey report. China pumps in $5.9 trillion a year — versus $5.1 trillion in the US and just $3.1 trillion in the EU — underpinning Beijing’s global competitiveness. Relative to the size of its economy, China now has 1.7 times the productive capital stock as the US and EU. “Global geopolitical shifts call for a new cartography of competitiveness,” the report said. To regain their edge, advanced economies, which will find it hard to justify the costs of broad-based reindustrialization, should instead specialize in areas like AI, biotechnology, chips, and EVs, along with industries that offer greater protection from supply chain disruption.

Huawei challenges Nvidia in China

Huawei is mounting a growing challenge to Nvidia in China. Nvidia’s share of China’s AI chips market is predicted to shrink from 40% in 2025 to 8% this year, while Huawei could grab around 50%. Nvidia invoked its Chinese rival’s capabilities to lobby Washington to greenlight more sales to China, warning that Huawei could “satisfy global AI chip demand” if Nvidia was shut out — a ploy that worked, The Wire China reported. But the reprieve hasn’t revived Nvidia’s China sales, and Huawei is reportedly planning to challenge the US giant’s dominance in South Korea too. Still, Chinese chips trail Nvidia’s in quality and quantity, an expert argued: “Huawei simply does not pose a competitive threat to Nvidia globally right now.”

Nobel laureate decamps to China

Two prominent US scientists — including last year’s winner of the Nobel Prize for Chemistry — will move to Chinese universities this year, as the global competition for top academic talent heats up. Nobel recipient Omar Yaghi is moving from Berkeley to Tsinghua University to lead a new AI research center, the South China Morning Post reported. In addition to luring top scientists, Beijing is exploring ways of disincentivizing Chinese researchers from publishing in foreign journals over fears about leaks of technological innovations, the Financial Times said. Ph.D. admissions at top US institutions fell 15% this year owing to the Trump administration’s federal funding cuts, The New York Times reported, with one expert saying China is taking “advantage of the United States’ unforced errors.”

Russians turn to Chinese EVs

Russians are flocking to purchase EVs in the face of a worsening national fuel crisis, with Chinese automakers the prime beneficiaries. Electric adoption has lagged in Russia given usually cheap gas and the relative paucity of charging stations. But Ukraine’s destruction of Russian energy infrastructure has flipped that dynamic, with Russians experiencing fuel shortages similar to those recently faced by Asian countries — where EV sales also surged due to the Iran war’s energy price shock. One Russian car dealer specializing in Chinese brands reported doing a month’s worth of business each day during the crisis. Some Chinese businesses are finding other ways to take advantage, with some reportedly offering to retrieve Russian vehicles, fill them up, and return them across the border.

Wall Street’s China profits soar

Major US investment banks are seeing surging profits from their China units thanks to increased cross-border trading, the Financial Times reported. Foreign financial firms have for years struggled in China, reporting losses or declining profits. Indeed, the investment banking divisions of Goldman Sachs, JP Morgan, and Morgan Stanley have remained languid, according to FT calculations, while European banks such as Deutsche Bank and HSBC have had downbeat overall results in the country. But the American institutions’ trading and brokerage arms have made inroads, thanks in part to volatility resulting from trade tensions and rapid policy shifts tied to Beijing’s rivalry with Washington, one analyst told the FT.

Western sport brands struggle in China

Some Western sports apparel brands are struggling in China, a market they long counted on for growth. Lululemon is facing slowing sales after two recent social media controversies. Nike also saw a 17% drop in its China sales in the previous quarter, the company said last week. Some Chinese rivals are moving in: Anta Sports agreed this year to buy a 29% stake in Puma, which posted a loss in 2025 largely because of weakness in China. Other international brands are radically localizing. Adidas, which has bucked the trend to report strong growth in China, designs and develops more than half of its apparel in the country.

Chinese photogs find global appeal

Luxury fashion brands are increasingly turning to Chinese photographers due to their versatility and perspective. Julian Song, Annie Lai, and Feng Li are among the names that have emerged in recent years, with bookings in Vogue and for brands like Prada, Gucci, and Miu Miu. Industry insiders say artists from China — a notoriously fast-moving market — are skilled at multiple styles, and are hence more attractive to clients looking for different looks. And even as some domestic brands embrace traditional Chinese motifs (the guochao trend) Chinese photographers are moving “away from the Chinese aesthetics Western fashion clients once expected,” The Business of Fashion wrote. “China’s contemporary photographers aren’t trying to explain China, romanticize it or package it into something easily digestible.”

Every week, we dig through China-focused newsletters and podcasts, and bring you key takeaways from the Sinologist community.

• Beijing is proposing a major rewrite of 25-year-old regulations that governed the internet. The move reflects the shift from overseeing websites to controlling massive platforms and AI, with tighter rules for foreign companies operating in China. — Geopolitechs
• A slate of Chinese experts told a recent roundtable that the US-Iran war should motivate Beijing to develop backup shipping routes and diverse supply chains, because “no major power today has the ability to comprehensively control strategic chokepoints.” — The East is Read
• The US is distancing itself from China, Europe, and Russia at the same time, an unusual position that strengthens Beijing’s geopolitical hand, a prominent Chinese researcher argued. The global powers “need to strengthen communication, and even cooperation, with China.” — Sinification

• Türkiye hosts the annual NATO summit through Wednesday, with four Indo-Pacific states in attendance and China looming large.
• Analysts are watching for the impact of easing oil prices on China’s inflation data, released on Thursday.
• Luxshare Precision Industry, a Shenzhen-listed company that assembles AirPods and iPhones for Apple, pursues a secondary listing in Hong Kong on Thursday.

A popular Chinese influencer duo behind a scandal-plagued digital marketing firm has pivoted to selling video workshop courses. Three Sheep Group was hit with a $10.3 million fine in 2024 and banned from livestreaming after government investigators determined that Hong Kong-brand mooncakes marketed as part of the company’s colossal e-commerce business actually originated in Guangdong. The influencers have yet to see their follower counts recover, and their per-stream takings have collapsed from millions of dollars to as little as $37,000, the South China Morning Post reported, illustrating the extent to which Beijing will penalize creators at the forefront of digital e-commerce. Still, in February, Three Sheep struck a deal to operate the commercial arm of the world’s most popular TikToker and his AI avatar.