BYD takes on Japan's minicar market with cheap, in-house batteries
TOKYO -- Chinese electric vehicle maker BYD is leveraging its cheap, in-house manufactured batteries to break into Japan's market for kei minicars, a field where overseas players have seen little success.
"Young people do not have a negative view of BYD. It would be a huge threat if the company launches cheap models in Japan," a Suzuki dealer said Tuesday.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Nikkei Asia
3 hours ago
- Nikkei Asia
EU-China ties at 'inflection point,' von der Leyen says after tense Beijing summit
BEIJING, July 24 (Reuters) -- EU-China trade ties have hit a "clear inflection point," European Commission President Ursula von der Leyen said on Thursday in Beijing, capping a tense summit with top Chinese leaders dominated by concerns on commerce and the Ukraine war. Expectations were low for the summit in the Chinese capital marking 50 years of diplomatic ties after weeks of escalating tension and wrangling that led to the duration being abruptly halved to a single day at Beijing's request. "We have very frankly and openly raised our concerns ... on the trade, investment and geopolitical issues. ... We have partially identified solutions," von der Leyen told a press conference after meeting with Chinese President Xi Jinping and Premier Li Qiang. When asked about a potential trade deal with the United States, the EU chief said the bloc's focus has been on achieving a negotiated solution but all other instruments are on the table until "we have a satisfactory result." "Our relationship with China is of importance, but it stands on its own merits. It's independent of the actions or issues we have with others," she said. Xi earlier told von der Leyen and European Council President Antonio Costa that the challenges facing Europe do not come from China, urging the bloc to "properly handle differences and frictions." "It is hoped that the European side will keep the trade and investment market open and refrain from using restrictive economic and trade tools," Xi said, according to the official Xinhua News Agency. EU trade actions in the past year have targeted Chinese exports of electric vehicles, among other goods, and its officials have repeatedly complained about Chinese industrial overcapacity as the bloc's trade deficit with China ballooned to a historic 305.8 billion euros ($360 billion) last year. Von der Leyen told the press that the Chinese leadership has started to look into the overcapacity issue and expressed willingness to support more consumption. "We think increasing market access for European companies in China, limiting the external impact of involution, and reducing export controls are important steps forward," she told Premier Li earlier, according to a pool report. She described her meeting with Xi as "excellent." The two sides also issued a joint statement on climate, reiterating their commitment to new climate action plans across the whole economy. They will boost cooperation in areas such as energy transition, adaptation, methane emissions management and control, carbon markets, and green and low-carbon technologies, the joint statement said. At the start of U.S. President Donald Trump's second term, both sides had more of a consensus in working together to tackle trade challenges from the United States, said Cui Hongjian, a foreign policy professor at Beijing Foreign Studies University. "Recently the situation has changed," Cui said. "The EU has continued to compromise with the United States, which means that there is currently a lack of impetus for EU-China ties to become closer." After intense negotiations, the EU is likely to seal a trade deal with the United States for a broad tariff of 15% on its exports, down from 30% threatened by Trump. At Thursday's summit, the EU leaders also conveyed their expectations for China to discourage Russia in its war against Ukraine. "What's important is that we have a ceasefire and negotiations at the table take place, that there is a true and genuine willingness to find solutions to end the bloodshed," von der Leyen said at the press conference. Topics the Europeans brought up in the talks also included China's rare-earth export controls that disrupted supply chains worldwide, causing temporary stoppages in European automotive production lines in May. "We need reliable and secure supplies of critical raw materials from China ... we acknowledge China's efforts on fast-tracking licenses for critical raw materials, and we agreed to have an upgraded export supply mechanism," von der Leyen said. China's exports of rare-earth magnets to the EU surged in June by 245% from May, to stand at 1,364 metric tons, though that was still 35% lower than the year-earlier figure, customs data showed. On Thursday, China's Foreign Ministry defended the rare-earths curbs as being "in line with international practice," while pledging stronger dialogue and cooperation with relevant countries and regions in the field of export controls.
The Diplomat
4 hours ago
- The Diplomat
US Foreign Aid With Chinese Characteristics
The dismantling of USAID is the culmination of a decade-long realignment of Western approaches to development, inspired by China's Belt and Road Initiative. The GSEZ Mineral Port in Gabon, one of the projects supported by public-private partnership via the U.S. International Development Finance Corporation. As President Donald Trump takes a chainsaw to U.S. foreign aid programs, it would be easy to attribute such extreme measures to MAGA isolationism or DOGE zealotry. While anti-globalist and anti-government ideologies certainly played a role, the shift away from traditional foreign aid is not limited to the U.S. and does not represent a full-scale abandonment of development finance. Indeed, Trump's moves represent the culmination of a decade-long realignment of Western approaches to development, inspired by China's Belt and Road Initiative (BRI). The retreat from traditional foreign assistance cuts across the Western world. By 2026, estimates hold that foreign aid budgets will have fallen by over one-quarter in Canada and Germany and by close to 40 percent in Britain, compared with 2023 levels. Overall, G-7 countries, which account for 75 percent of foreign assistance, spent 28 percent less in 2025 than in 2024. Yet even as Trump's Big Beautiful Bill cut foreign aid, it also provided new funding – a $3 billion revolving fund – for the International Development Finance Corporation (IDFC), which was created by the 2017 BUILD Act. The IDFC is up for renewal this year, and the House Foreign Affairs Committee has already voted in support of authorizing its operations for another seven years with a lending cap of $120 billion, double the initial level. The IDFC was intended as an answer to China's BRI, which represented an alternative to traditional Western approaches to aid. The Development Assistance Committee (DAC) – a club of Western donor countries – defines Official Development Assistance (ODA) as concessional finance directed toward developmental projects in low- and middle-income countries. The DAC encourages transparency and discourages the tying of aid to purchases of goods and services from the donor country. Most DAC countries emphasize 'soft' aid, focused on health, education, and humanitarian assistance. ODA typically draws upon budgeted funds that must be renewed annually. Very little of Chinese development finance meets these criteria. Instead, China's development finance is commercial in orientation. Most loans are initiated by policy banks – the China Development Bank and the China Export-Import Bank – that raise funds by issuing bonds to investors. Loans carry near-market interest rates and must be repaid in full. Much of Chinese development finance has been channeled through the BRI, which focuses on infrastructure construction. Loans through these policy banks and others have amounted to well over a trillion dollars over the past decade. Western countries have followed China's lead both in commercializing development finance and in driving more resources toward infrastructure development. The latter move has transpired under the guise of various initiatives: the BUILD Act (U.S.), Build Back Better World (U.S.), the Global Gateway initiative (European Union), the Blue Dot Network (U.S., Australia, Japan), the Quality Infrastructure Investment Initiative (Japan), and the Partnership for Global Infrastructure and Investment (G-7). The competitive ambitions of the West have been limited by a paucity of available public funds, which makes it difficult to match the scale of China's BRI. This problem gave rise to efforts to leverage public money to mobilize private capital for development purposes through blended finance initiatives. At the multilateral level, a group of multilateral development banks issued a planning document titled 'From Billions to Trillions: Transforming Development Finance' in 2015. This paper outlined a vision for mobilizing private financial resources toward Global South infrastructure and other developmental needs. This was followed by the World Bank's 'Maximizing Finance for Development' initiative and the United Nation's 'Global Investors for Sustainable Development Alliance.' These projects and those discussed below constituted what Daniela Gabor characterized as a 'Wall Street Consensus.' Many types of infrastructure take the form of public (or semi-public) goods. Public goods, by their nature, are underproduced relative to their social utility because producers cannot exclude consumers from benefiting once the goods are produced. The Wall Street Consensus aims to make infrastructure projects 'bankable' or attractive to private investors by shifting the risk of unprofitability to the state. If successful, private money is pooled with public funding through blended financing models such as syndicated bond issues. In this 'development as derisking' model, private capital is 'escorted' into the process of financing infrastructure through the creation of new asset classes freed of investor risk. In 2018, the G-20 declared support for a Roadmap to Infrastructure as an Asset Class. Two types of risks must be minimized for private investors: regulatory risk and financial risk. Reducing regulatory risk includes lower environmental and safety standards, guaranteed grid access, legal protections against nationalization, and liability limits. Financial risk is managed through guaranteed toll revenues, preferential credit, loan guarantees, tax relief, or subsidies. Multilateral Development Banks (MDBs) or DAC donors help build state capacity in project identification and development, provide expertise in securitizing infrastructure assets for the market, and offer partial financing or loan guarantees. The necessity for subsidies and other forms of state support arises from the fact that more than half of infrastructure projects in emerging economies do not promise sufficient cash flow to attract private investors. Even projects with dedicated revenue streams often carry demand risks, meaning they turn unprofitable if demand for the service declines. Governments may be compelled to include contract provisions that promise to cover revenue shortfalls with public funds when demand falls below certain thresholds. Seth Schindler, Ilias Alami, and Nicholas Jepson noted that what Gabor referred to as the 'derisking state' becomes both more dependent upon global finance and increasingly interventionist in shaping market outcomes. This contrasts with the Washington Consensus, which counseled state neutrality vis-à-vis the market, but also differs from the East Asian development model, where state intervention sought to shape the behavior of national capital rather than global capital. By relieving private investors of risk, states aim to amplify the capital that can be mobilized toward critical development needs beyond national savings or the resources of MDBs and bilateral donors. The trade-off is the acceptance of risk by the developing state, a danger highlighted when the COVID-19 pandemic and rising interest rates threatened the solvency of many highly indebted countries. The U.S. International Development Finance Corporation fits this model. The BUILD Act described its purpose as to 'provide countries a robust alternative to state-directed investments by authoritarian governments and United States strategic competitors.' With a financing authority of $60 billion, the IDFC seeks to 'crowd-in' private capital with a flexible toolkit that includes nonconcessional loans, loan guarantees, export credits, political risk insurance, equity investments, and technical assistance. Largely due to IDFC activity, nonconcessional development finance flows jumped from 4 percent of overall U.S. aid spending in 2020 to 36 percent in 2021. Among the major projects funded by the IDFC are investments related to the Lobito Corridor in Southern Africa, which aims to create transportation links allowing Western firms to access critical minerals that are presently monopolized by China. Ironically, this growing Western emphasis on nonconcessional, commercialized development finance with an emphasis on infrastructure development comes at a time when China has scaled back the BRI (largely due to growing evidence that many recipient countries have exceeded their borrowing capacities) and begun allocating more resources to 'soft' aid through the Global Development Initiative. An obvious drawback of the blended finance model is that it diverts attention and resources from traditional concessional aid and the investment in health, education, and disaster assistance that remain essential. But even on its own terms, the effectiveness of the Wall Street Consensus remains in doubt. A 2020 report by the Center for Global Development concluded that the overall flow of blended finance had been disappointing and that the great bulk of MDB-mobilized private financing was directed to middle-income rather than low-income countries. A 2019 study by ODI Global reached similar conclusions. In low-income countries, on average, each $1 in public development financing mobilized only $0.37 in private finance. Blended finance was constrained by the low risk tolerance of both public and private actors in the face of environments hampered by poor governance and few profitable investment opportunities. Since most blended finance flowed to middle-income countries and to 'hard' sectors, such as transport and energy, as opposed to social sectors, the report suggested that the increased priority given such investments came at the expense of programs that more directly targeted poverty in low-income countries. Indeed, the proposed doubling in the funding cap for the IDFC cannot substitute for the human costs that follow from the cuts to U.S. Official Development Assistance, which one study suggests will lead to 14 million deaths over the next five years. Traditional aid may have drawbacks, whether evaluated as a tool of U.S. foreign policy or in terms of development effectiveness, but abandoning it in favor of the privatization of development finance is neither wise nor humane.
The Diplomat
4 hours ago
- The Diplomat
China's New Mega-Dam Raises the Stakes for Sino-Indian Hydrodiplomacy
On July 19, Chinese Premier Li Qiang officially announced the start of construction on a long-planned hydropower project on the lower reaches of the Yarlung Tsangpo River. Billed as a centerpiece of China's clean energy drive, the dam marks a new chapter in the country's infrastructure history – one with profound implications not only for domestic development, but also for regional stability in South Asia. This is no ordinary project. First proposed in the 1990s and later elevated to national priority in China's 14th Five-Year Plan, the Yarlung Tsangpo hydropower station is widely seen as the country's most ambitious hydro initiative since the Three Gorges Dam, with Li framing it as a 'project of the century.' The dam's installed capacity will reportedly exceed 60 gigawatts – roughly triple that of the Three Gorges – generating electricity for tens of millions of homes. State media underscored its strategic importance in helping China reach its 2060 carbon neutrality target, ensure energy security in western regions, and promote high-quality development in the Tibet Autonomous Region. It is also part of China's 2035 long-term development strategy, which calls for the creation of multiple clean energy hubs along major river basins. But the project's magnitude also heightens its geopolitical sensitivity. The Yarlung Tsangpo, known as the Brahmaputra once it enters India, originates in Tibet and flows east before making a dramatic U-turn at the Great Bend and descending into Arunachal Pradesh – a territory claimed by both India and China. It eventually reaches Bangladesh and empties into the Bay of Bengal. The river sustains agriculture, fisheries, and livelihoods for over 130 million people downstream. That China's newest dam is located just upstream of this bend – before the river crosses into Indian-administered territory – has renewed long-standing concerns in New Delhi about Beijing's leverage as an upper riparian state. Those concerns are not new. Indian officials have for years raised objections to large-scale Chinese dam-building along the Yarlung Tsangpo, especially when pursued unilaterally. Following earlier project announcements in January, India's Ministry of External Affairs publicly called for prior consultation on all activities affecting shared rivers. While no new official statement had been released following last week's announcement, Indian media reported that the government is 'closely monitoring' the latest developments. Some Indian commentators have gone further, warning that Chinese dams near the border could pose strategic risks during times of heightened tensions. Arunachal Pradesh chief minister Pema Khandu openly described the proposed dam as a potential 'water bomb.' Chinese authorities, for their part, have sought to allay downstream concerns. Chinese diplomats have emphasized that the project is designed as a run-of-the-river facility that will not significantly alter water volumes flowing into India. In addition, China insists that it 'has always acted responsibly' when developing transboundary water resources. But such reassurances – though consistent in tone – have not always sufficed to calm regional unease. For downstream countries, what matters is not only hydrological facts, but also a sense of inclusion and institutional trust. That trust remains limited. At present, the only formal cooperation mechanism between China and India on water issues is a hydrological data-sharing agreement first signed in 2002. Under this memorandum, China provides India with real-time flood season data on the Yarlung Tsangpo to aid disaster preparedness in Arunachal Pradesh and Assam. However, the mechanism has proven vulnerable to geopolitical strain. In 2017, during the Doklam standoff between Chinese and Indian forces, Beijing temporarily suspended data transfers – a move widely interpreted as political signaling. Although data-sharing later resumed, the episode revealed just how fragile functional cooperation can be in the absence of deeper institutional guarantees. At the heart of the issue lies a legal and diplomatic vacuum. Unlike India's water treaties with Pakistan (the Indus Waters Treaty, which India suspended following a terror attack in April) and Bangladesh (the Ganges Water Sharing Treaty), there is no binding bilateral framework governing river management between China and India. China has generally opted for flexible, bilateral memoranda rather than formal legal agreements, citing the principle of upstream states' sovereign rights to develop internal water resources. This divergence in legal philosophy – combined with mutual mistrust – has left the Yarlung Tsangpo without the kind of institutional architecture that could help prevent escalation. That absence is all the more concerning given the broader regional context. South Asia is already among the world's most water-stressed and conflict-prone river basins. Climate change is accelerating glacial melt, intensifying floods, and shifting monsoon patterns, all of which amplify the stakes of upstream interventions. Bangladesh has long expressed frustration over upstream diversions affecting its dry-season flows. Nepal has sparred with India over hydropower projects along the Ganges tributaries. In recent years, India itself considered reviving a major dam project in Arunachal Pradesh – widely viewed by analysts as a geopolitical counter to Chinese activities upstream. It would be shortsighted for China and India – Asia's two most populous nations – to allow water to become another theater of strategic rivalry. The potential for cooperation is far greater. Establishing joint monitoring mechanisms, expanding early warning systems, and launching basin-level dialogues could foster transparency and confidence. Strengthening the existing data-sharing agreement and insulating it from political disruptions would be a good first step. But building true water cooperation will require more than technical fixes. It demands institutional imagination – and political will. That kind of institutional breakthrough will not be easy. Neither China nor India has signed the 1997 United Nations Convention on the Law of the Non-Navigational Uses of International Watercourses, the only global treaty governing transboundary rivers. And while India has signed binding water-sharing treaties with some neighbors, its approach remains similarly bilateral and interest-driven. In other words, both governments have historically rejected the idea that upstream development should be subject to international constraints. In this sense, their stances mirror each other: each sees itself as a regional hegemon, wary of legal obligations that might curtail sovereign decision-making. As a result, both countries have become status quo powers in a region that desperately needs rule-making. This mutual caution reflects deeper realities. In both Beijing and New Delhi, water is not just a resource – it is a symbol of authority, sovereignty, and developmental legitimacy. That makes compromise politically difficult, especially amid rising nationalist sentiment and hardening border disputes. But the absence of cooperation carries its own dangers. As climate change and geopolitical risk compound each other, what is now an institutional vacuum could easily become a vacuum of control. A shift will not come easily. But the risks of inaction are real. The Yarlung Tsangpo will continue to flow across borders, indifferent to geopolitical lines. Whether it becomes a source of contention or a channel for collaboration depends on the choices that China and India make today.
