New Zealand FM visits China: Strengthen ties amid regional concerns and global shifts
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New Zealand Foreign Minister says his country stands ready to strengthen cooperation with China in areas such as economy, trade and defense.

Ukraine has approved an agreement with the United States on critical minerals. And Beijing has urged the United States to stop arming Taiwan and desist from undermining peace and stability across the Taiwan Strait. Welcome to Road Today, a news program with a different perspective. I'm Ge'enna in Beijing. To listen to this episode again or to catch up on previous episodes, you can download our podcast by searching Road Today.

China and New Zealand have reaffirmed their commitment to maintaining high-level exchanges and strengthening communication and cooperation to ensure bilateral ties moving forward on the right track. The pledge was made during talks between Chinese Prime Minister Wang Yi and his New Zealand counterpart Winston Peters in Beijing on Wednesday. Wang noted the two sides should adhere to mutual respect and properly resolve differences.

He also highlighted win-win cooperation in artificial intelligence and climate change, strengthening dialogue on common concerns. Peters said New Zealand stands ready to strengthen exchange and cooperation in fields such as the economy, trade and agriculture and defense.

To delve into this, joining us in the studio is Chen Xi, Assistant to Executive Director of the Asian Pacific Studies Center at East China Normal University. Welcome to our show, Chen Xi. Thanks for having me. With the current complex international landscape, what do you make of Peter's visit to China in terms of its significance for enhancing the bilateral relationship between the two countries?

Yes, so this time's visit for Winston Peters is actually his first China visit since he took the office in 2023. But actually, this is also his sixth official visit to China since his first visit in 1997.

So the most important thing is the strategic significance of the visit, because this year marks the beginning of the second decade of the comprehensive strategic partnership between China and New Zealand. So it's very important for both sides to advance the mutual understandings as well as to consolidate the development of the bilateral relationship.

So for sure, the trade and economic relationship has been one of the key areas both sides will definitely tap on. But also to exchange in-depth views on bilateral relationships, as well as the international and regional issues of mutual interest, will be the very important topic for this visit as well. We know China and New Zealand have maintained close cooperation in trade and economic matters.

What specific topics related to these sectors do you expect to be discussed during this visit? Will there be new opportunities for cooperation between the two nations?

Yeah, so we know that the Chinese and New Zealand economies, they are highly complementary and also closely integrated in kind of all aspects and at a very deep level. So since the establishment of the formal diplomatic relationship between China and New Zealand in 1972, two countries, Economic and Trade Corporation, has actually expanded from China

the very beginning trading goods and now to the trading services and as well as the industrial investment, also science and technology as well as for the other fields. And the bilateral trade has increased in recent years dramatically as well.

And after the regional comprehensive economic partnership and also the upgrade to the New Zealand-China FDA, the Fruit Trade Agreement came into effect in 2022, the economic and trade cooperation between two sides have been injected stronger impetus.

So in terms of the relationship with China, it has been for quite a long time that both the ruling party as well as the opposition parties of New Zealand, they have attached a great importance to this bilateral relationship. And this mutually beneficial cooperation between the two countries have become increasingly close after 2014 when the bilateral relationship was upped

upgraded to a comprehensive strategic partnership. So for a very long time, China-New Zealand relationship have led the relationship between China and Western developed countries. And this cooperation in various fields has already yielded fruitful results.

And we will remember in the Luxembourg government, actually they set the target of doubling its export to the world. So to developing ties with China, which is New Zealand's long-time largest trading partner and export destination is very important for the country to achieve its goal. And in addition to

the long time, the trade relationship in areas like agricultural as well as dairy products. Actually, China and New Zealand, they can expand economic cooperation to a lot of more emerging areas such as the digital economy and also grain economy, as well as the new energy vehicles and creative industries.

And also for many areas that might, you know, less known to public, such as the Antarctica. Actually, China and New Zealand, they have cooperated to

to use Christchurch as the Antarctic Gateway City for quite a long time. So there has been a lot of cooperation in regards of logistics sharing and also in some other areas that China and New Zealand have cooperated for decades' time. So after this visit, actually the both sides...

will continue to have the willingness to deepen these economic ties. And also new areas will definitely be discussed during the visit towards the future development of the bilateral relationship. As you said, the relationship between China and New Zealand is generally very positive. But we have seen some recent reports where New Zealand has expressed some concerns about China's cooperation with the Cook Islands.

China has emphasized its cooperation is not aimed at any third parties. But what do you make of these concerns? How can China and New Zealand promote positive regional cooperation in the South Pacific and work together for mutual development?

So the Cook Islands, it maintains a free association relationship with New Zealand. But as a sovereign state, the Cook Islands also has absolute right to develop policies and partnerships with other countries, including China.

We know that the visit of the Prime Minister of the Cook Islands to China was to strengthen and expand cooperation with China in trade and also climate and also investment, tourism, infrastructure and also other fields. And definitely this cooperation is aligned with the interests of both sides. So China's cooperation with all Pacific Island countries is not targeted at

any third country and China always welcome the participation of any third countries. And in fact, in areas such as enhancing national climate resilience efforts, particularly in weather forecasting and climate change adaptation,

For Pacific Island countries and also China and New Zealand all share common interests in this regard. So it is actually very necessary and important for China, New Zealand and also Australia to expand cooperation with Pacific Island countries in addressing challenges that the whole region is facing such as climate change which would contribute to the economic development and people's livelihood not only for

Pacific Island countries themselves, but also China, New Zealand and all other countries in the region as well. There is another concern that some in New Zealand view China's Tasman Sea drills as a threat and have called for increased defense spending in the country. How can the recent visit help clear up these misunderstandings and build mutual trust, especially in the realm of regional security?

Yes, so there is now a certain group of people in not only New Zealand but also Australia who are hyping and asserting that China's touchman seed rules have posed concerns and threats.

But also it is equally important to point out that both Australian Prime Minister Anthony Albanese and also New Zealand Prime Minister Luxon, they have made it clear that China's operation has been in compliance with international law. So the importance of keeping the high level dialogues is to maintain cooperation between different sides and also to clarify facts, avoid any type of miscalculations and misperceptions

And so that to consolidate and even further to strengthen the mutual trust between different countries. And we can see this, you know, we can see that both sides, not only China, New Zealand, but also Australia, they all have very clear idea on this. And another very typical example was the defense strategic dialogue.

between Australia and China, which was just held last week, to exchange views on relations and also issues of common concern. So this is exactly the most important part of maintaining the high-level dialogue and what this can contribute to the understanding between different sides.

Then let's shift to Peter's trip to Asia in general. He also includes visits to countries like Saudi Arabia and the UAE. Where does his visit to China play in New Zealand's broader diplomatic strategy? Yes, so Peter's Asia visit is basically to explore economic opportunities for New Zealand. This is the most important task for him this time. And in which to develop economic

ties with New Zealand's long-term largest trading partner and export destination, which is China, is important for New Zealand to develop its economy in the long term.

And also, as we just mentioned before, there has been a very important consensus among different parties in New Zealand that China is an important partner of New Zealand and to develop and promote partnership with China is New Zealand's constant national policy. And also we see from the fact that the cooperation between two sides have already yielded fruitful results recently.

So for sure, China is one of the most important countries New Zealand has to consider in its overall diplomatic strategy. And also there are a lot of more opportunities for both sides to develop in the future together as well.

One last question. Let's talk about hypothesis here, about the future direction of China-New Zealand relations, especially in the context of the Trump 2.0 era. If the U.S. continues to exert pressure on its allies to contain China, how might this affect bilateral ties between China and New Zealand?

Yes, so New Zealand has long adhered to an independent foreign policy and taken its own long-term interests as the fundamental principle of its foreign policy.

Just like the New Zealand Prime Minister Luxem made it clear that it was six to build and upgrade New Zealand's cooperation with China. And also New Zealand former Prime Minister also noted that although New Zealand is part of the Five Eyes, that doesn't mean it can't have a very successful, more trade-based relationship with China.

But that said, for sure, there are differences between China and New Zealand in terms of political systems and also their governance models and also certain cultural traditions, for sure. But it should not be these differences that define the nature and also the direction of the bilateral relationship.

And the mutually beneficial cooperation between China and New Zealand has already enjoyed huge momentum and very broad prospects. The two countries should definitely continue to strengthen communication, coordination, as well as cooperation.

as well as cooperation in international, as well as regional affairs and to work together to address global challenges in an even unpredictable world ahead with heaps of uncertainties.

Thanks, Chen, for your insightful analysis. That was Chen Xi, Assistant to Executive Director of the Asia-Pacific Studies Center at East China Normal University. Coming up, Ukraine has approved agreement with the United States on critical minerals. This is Road Today. Stay with us.

Gold prices are soaring, hitting new highs more than 10 times this year. How unusual is this? What's driving the surge in addition to America's tariff plan? We'll also explore the ripple effects on the global economy and how rising gold prices could impact our daily lives. Get it all on this week's chat lounge, on your favorite podcast platform and CGTN radio.

You've been listening to Road Today. Ukrainian Prime Minister Denis Shumihol says his government has approved an agreement with the United States on critical minerals. Ukrainian President Volodymyr Zelensky will visit the U.S. to sign the deal. He says the success of the deal hinges on talks in Washington and continued U.S. aid.

In Washington, President Donald Trump insists his country will not be making security guarantees for Ukraine, but Europe will. He adds Ukraine would forget about joining NATO, which he thinks could be the reason for the conflict.

For more on this, let's have Dr. Zhao Hai, Director of International Political Studies at the National Institute for Global Strategy. Thanks for joining us, Dr. Zhao. Thank you for having me. Let's start with the most pressing issue for Ukraine. Ukraine has emphasized that it will not sign any agreement without security guarantees. But earlier reports suggest the U.S.-Ukraine mineral agreement does not mention providing firm security assurances

If that is the case, how do you view Ukraine's position on signing this agreement without security guarantees? Is this agreement genuinely a promise of long-term stable economic growth, or is it merely a short-term strategic compromise?

Well, I think it's relatively a short-term strategic compromise because at this point, there's a huge gap between the Ukrainian position and American position. President Trump has made it very clear that the security guarantee, if there's any, should be provided by Europeans, not by Americans. And at this point, America is very surprised

skeptical about any further security assistance, let alone security guarantee to the Ukrainians. And also, let's remember the relationship between President Trump and President Zelensky was not very good. They're actually at each other's, you know, the performance getting worse.

So that's number one. And number two, at this point, I think Ukraine, of course, wanted to have some sort of security guarantee going into a possible negotiation with the Russian side. However, to provide that security guarantee previously can be done by joining the NATO.

However, the US has shut the door for Ukrainians to join NATO. So at this point, that option is no longer available. But then at this point, if NATO is not available, then the United States, of course, won't provide that guarantee. The only one left alone is the Europeans. But I don't think Europeans at this point can collectively provide a real security guarantee

to the Ukrainian side against the Russians. So overall, I think the Ukrainians have to put this aside and sign the agreement, mineral agreement first, so that they can keep the Americans in the game and talk about security guarantee later in the negotiations with the Russians.

Dr. Zhao, moving on to the specifics of this agreement, according to the Ukrainian government, there are six key points in the deal. The establishment of a reconstruction investment fund, jointly owned and managed by both governments, aimed at supporting rebuilding projects, and Ukraine's retention of ownership of its mineral and natural resources, the allocation of 50% of future revenue from these resources into the fund.

and the U.S. provision of financial instruments and other support for reconstruction efforts, and a guarantee that the agreement will not impede Ukraine's European integration process.

How do you evaluate these key points? Do you think the practical implications will be as promising as they appear? Or from a historical perspective, do you see a risk of repeating the problem seen in the past Latin American agreements with the United States, such as the loss of financial sovereignty in the near future? Well, I think at this point, this agreement itself is still pretty rough. So it's sort of

a starting point for further negotiation because we still don't know exactly what kind of resource or asset can be put into that reconstruction fund and exactly how much percentage of Americans will have in that fund and exactly what the fund could be used in the reconstruction project.

So I think there are many questions that are answered in wait for further discussions and negotiations between the two sides to iron out the details. And as we say, the devils are in the details. So exactly what's going to happen down the road is still unclear.

the intention of the Ukrainians at this point to sign this very rough early stage agreement is to keep the Americans in the game so that Americans will have a skin in the game and continue to try to support and help Ukrainians. But exactly in the future, how much, as you said, financial sovereignty or their own countries

control of resources remaining is still very much in question. So I think, you know, moving forward with the agreement signed, of course, there needs to be hope that Trump will be on his side in the negotiations, won't be siding with the Russians and, you know, pressure Ukraine further. However,

Remember, I mean, at this point, the sacrifice on the Ukrainian side, of course, is that they're not only allowing mines, but also ports and other strategic assets to be put into that sound. That means after the war, many...

almost like all the available assets that create cash flow will be in that fund. So I think Ukrainian government is very much in danger of losing control of their own country and their fiscal policy.

The shifting focus to the upcoming visit, Zelensky has stated he will ask Trump three questions during his visit to the U.S. on Friday. One is, does the U.S. still support Ukraine? And then, can Ukraine buy weapons from the U.S.? And the last one is, can Ukraine use frozen Russian assets to purchase weapons? What's your take on these questions? And what do you think the Trump administration's response will be?

I think the Trump administration will remain uncommitted because at this point, Trump is determined to left the conflict and making sure that there will be peace, no matter how fragile that is, to be brought back to the battlefield. And as to other questions about how can the United States, like President

holding an asset or having a part of this negotiation, I don't think Zelenskyy on this particular trip can extract that information. Again, it depends on the future negotiation among those three sides. And the Russians have already said that Ukraine will be included in the negotiation process.

But the question is still, like, how much contribution or how much staying can Ukraine have at this particular point?

Looking at Russia's position, the Kremlin has declined to comment on reports about the Mineral Deal, but both Russia and Trump have previously expressed interest in mineral cooperation. How do you interpret Russia's stance on this, not only regarding cooperation with the U.S., but also Russia's view on Ukraine signing such an agreement with the U.S.?

Well, it's interesting because Russia didn't say that they don't like this deal. That means...

Actually, Russia is thinking the post-war situation in Ukraine because Russia will not give out the occupied territory back to Ukraine, that's for sure. And also, Russia will demand that Ukraine not join NATO. And if the United States has a spin in this game, that may not be a bad thing for Russia,

the United States will keep some presence in the area. And also, if the United States want to get something out of the farm, that means at a certain level, they need not only cooperate with Ukraine, but also cooperate with Russia. Because when we talk about rare earth and other minerals, many of the deposits of those mines

and minerals are in the occupied area, no longer in the Ukraine government-controlled area. So that's why I think Russian side is saying that they could provide or cooperate with the United States and provide the United States with rare earths in the future.

And the other thing is that in terms of reconstruction farm, if reconstruction farm, meaning that they can produce farm for post-war reconstruction in the area, then maybe the Russian-occupied area of Ukraine can also get some part of that farm. So in this, I think Russia and the United States has

Both have a lot of room to manipulate, to go around the agreement and get what they want from this agreement. One last question. Let's talk about this from Europeans' perspective. What impact do you think the U.S.-Ukraine mineral agreement will have on Europe? Why does Europe seem to have concerns about this?

Well, from Europe's perspective, this is a spell out. And they worry about the Americans will continue to throw Ukraine under the bus and then pursue a sort of unilateral or bilateral peace agreement with Russia alone. That means a so-called flyover diplomacy that is happening, ignoring the position of the Europeans and also not giving Ukrainians a position on the negotiation table.

I think the Europeans, of course, they can criticize the American position. But the question is whether or not European countries can come together and form their strategic autonomy and providing alone the security assistance and security guarantee to the Ukrainians. Thanks, Dr. Zhao, for your insights. That's Dr. Zhao Hai, Director of International Political Studies at the National Institute for Global Strategy. This is Road Today. We'll be back after a short break.

Welcome back to Road Today with me, Gaena, in Beijing.

Beijing has urged the United States to stop arming Taiwan and desist from undermining peace and stability across the Taiwan Strait. Reports claim that the Trump administration has released US$5.3 billion in previously frozen foreign aid, including US$870 million designated for security programs in Taiwan. Chinese Foreign Ministry spokesperson Lin Jian has expressed concern about the reports.

He said China has always opposed the U.S. provision of military assistance to the Taiwan region. Ling said such behavior violates the one-China principle and the three-China-U.S. joint communiques and undermines China's sovereignty and security interests. So to talk more on this, let's have Liu Kuangyu, researcher at Institute of Taiwan Studies at Chinese Academy of Social Sciences. Thanks for joining us. Thank you. This is Kuangyu.

The Trump administration has unfreezed foreign aid, including military support to Taiwan. How does this action conflict with the U.S. longstanding one China policy and the three joint U.S.-China communiques?

Well, we know that the principles of one China, mutual respect, equality and mutual benefit and peaceful coexistence and non-affairance in each other's internal affairs, those principles are all jointly defined in the three joint communiques, which

constitute the political foundation of China and U.S. relations and guiding the two countries' relation to a steady and far-reaching course. And it has also shown the world that China and U.S., as the world's largest developing country and the largest developed country, do not clash or confront each other, which in itself is the most important piece divided from my camp. However, we can find that in recent years, despite the fact that there is no so-called formal or

official or contractual relationship between the U.S. and Taiwan. And the U.S. has long maintained very high frequency arms sales deals, military exchanges with Taiwan. And it should be noted that the U.S. side has not

Honored its commitment to reduce and terminate arms sales to Taiwan in the August 17th communique instead it has The so-called six guarantees and Reagan memorandum and which is playing the old trick of yin-yang contracts and the old trick of So this this is in order to unravel the self contradictory nature of his argument and

So also we should see that in Trump's first term of office, it will be concluded in the Pacific strategy. At the same time, he is a fanatic enthusiast of the sale of arms sales to Taiwan, which reaching a record high 11 times in four years, which is 11.3 billion US dollars. So that means

This seems to indicate that in Trump's second term, his Taiwan-related policies will have more negative uncertainties. Under such a context, what do you make of the timing of the Trump administration's decision? And what do you think are the underlying reasons for this decision?

The timing and reasons, I think, is something we can look at from two perspectives. The first is the first perspective of the U.S. From the U.S. side, Trump came to power for more than a month. And after internal affairs, including something like government streamlining, and now they begin to make moves on the Taiwan question. And there's already a trend of intensively playing the so-called Taiwan card against China. And this is a sign of it.

And secondly, the U.S. foreign strategy, we can see from the U.S. foreign strategy level, we can see the Trump administration is accelerating to leave from Europe immediately.

to leave from Europe and Middle East, to get out from Europe and Middle East and trying to focus on strategic competition with China and putting together all their allies and friends to block China, to encircle China. And recently we can see Japan and Canada and so on many other few countries have long been along with the U.S. to trying to intervene in the Taiwan Strait with their so-called small actions.

And this is not, I don't think, a coincidence. It shows the U.S. and their allies and their partners are calibrating their strategic orientation and priorities to trying to focus their competition with China. And Taiwan is their new card. Indeed, we know the U.S. military aid to the Taiwan region undermines the stability of China-U.S. relations.

But what potential long-term consequences could this action have in escalating tensions between China and the U.S. in other areas?

Yes, we can see, apart from like arms sales, we can see the U.S. accelerating its military ties with Taiwan through a combination of something like military assistance and like commercial cooperation and defense industry cooperation. And on the one hand, it has significantly inflamed the Sino-U.S. relations in the past few years. And of course, also the tensions in the Taiwan Strait.

and has also sent extremely wrong signals to the forces of Taiwan independence on the island, which has given the Lai Chin demonstration the false belief that it is seeking independence with the help of so-called military force and foreign aid, which will make cross-relations even more confrontational in the next few years and even pose a greater risk of conflict. And in the long run, I think the U.S. is trying to

continue to construct the Taiwan's so-called Taiwan straight peace hook theory. They're trying to make a hook, make a connection of their policy and the so-called China's Taiwan straight policy in recent years, adding a so-called premise for the establishment of diplomatic relations between China and US in the communique I just mentioned, in August 17 communique. And that is the US commitment to so-called one China policy

and commitment not to sell arms to Taiwan based on the so-called expectation of peaceful resolution of Taiwan question. So that means

the US is trying to, I think, to use some moral coercion to China to give up the force, the right to use force to solve the Taiwan question. Of course, we can see the US side knows very clearly that it's impossible, but they still hopes to use as the way to distort and discredit China's legitimate initiatives

to safeguard our sovereignty and territorial integrity and to label China as so-called the threat or aggressor and outlaw. So in order to induce the U.S. and the West and the international community so-called to oppose China and support Taiwan, this is a long trend we can see. Then what other concrete countermeasures could China take to safeguard its sovereignty and national security interests

besides firm opposition to U.S. recent move on the diplomatic front? Yeah. In my view, I think the most fundamental, most straightforward method is that China's hard power to safeguard our national sovereignty, national security, and continue to accelerate, especially in

accelerate up our unification process especially in recent years we can see that in Taiwan Strait our capability of air denial is increasing very fast and the strategy turns capability and also the modernization of our navy and air force we can see those so-called those weapons and those

new inventories in recent months, they have some shocks to the U.S. side, I think. I think we have shown our capability, which is hardly enough to suppress or offset the U.S. armed forces against Taiwan. And it's even superior to the United States in a certain, to the force of the U.S. to a certain extent, which has triggered a new realization in the U.S. political circles. They have shocks.

We know that just a few days ago, the American Journal of Foreign Affairs, they had published an opinion piece on this website entitled so-called Taiwan Obsession. They say the U.S. should not bet on war. It can win in Taiwan Strait. This article analyzes the high price that they will pay if the U.S. and China were going to war in Taiwan Strait. So that's all because the U.S.

what I say, the hard power of China's forces that have been growing very fast in recent years. And so the U.S., now they start to want so-called peaceful coexistence with China and want to abandon Taiwan. And there are more and more of this voice from the Capitol Hill, from the Biden administration. So that's the change we can see.

Thanks, Kwong Yu, for your insightful analysis and time. Thank you. That was Liu Kwong Yu, researcher at Institute of Taiwan Studies at Chinese Academy of Social Sciences. Coming up, Apple plans to invest 500 billion US dollars in the United States as the tariff era nears. We'll be back. Hello, my name is Alessandro Golombievski Teixeira. I'm a professor of public policy management at Tsinghua University in Beijing.

I am a great listener of The World Today. In my opinion, The World Today is one of the best China radio programs. In The World Today we can get the best news and analysis in what is happening now in the world. So please, come to join us!

This is the world today. Apple plans to open a new factory for artificial intelligence servers in Texas. This will be part of a $500 billion investment that the company plans to make over the next four years in the United States. Apple expects to create 20,000 jobs over that time, with the vast majority of roles in research and development, software and artificial intelligence. The

The announcement comes days after Apple's CEO met with President Donald Trump, who has made increased investment in the U.S. a priority. For more on this, our Zhao Ying joining us in the studio. Thanks for joining us, Zhao. Great to be here. 500 billion U.S. dollar investment, that's a huge number. Can you put that into perspective? What does that scale of investment really mean?

Well, that's indeed a huge amount of money. And to put that into perspective, it's more than the combined GDP of some medium-sized countries. It's roughly equivalent to the entire annual economic output of countries like Sweden or Belgium. And when it comes to Apple specifically, this investment is almost five times what the company has pledged in previous announcements for U.S. spending.

And a significant portion of that $500 billion will be directed toward manufacturing, including a new 250,000 square foot facility in Texas, where Apple will build servers for its AI services. And beyond manufacturing, the investment will be spread across various areas like building new data centers in states like North Carolina, Oregon, Arizona, and Nevada.

And there will also be substantial spending on R&D, innovation in AI and semiconductor design and enhancing Apple's silicon engineering capabilities. This includes ongoing work on custom chips, which have been a cornerstone of their product development.

And in terms of the broader impact, as you said, this 500 billion US dollars will be funneled into job creation because Apple promises to create 20,000 jobs over the next five years. And this includes not just factory jobs, but also positions in tech development, data science and customer service.

We see Apple is establishing a new AI server manufacturing facility in Houston to support Apple's intelligence. How critical is this move for Apple's AI ambitions? That's certainly a bold move, and it could be a significant step in Apple's strategy to deepen its involvement in artificial intelligence.

This facility will produce the specialized servers that power Apple's AI systems, helping to support services like Siri, Apple's predictive algorithms, and potentially new, more advanced AI-driven features across their devices and platforms. So we can see that Apple is taking the step to build these servers in-house instead of relying entirely on third-party data centers or cloud providers.

However, this will also be a challenging task for Apple because we know that Apple's business model has traditionally leaned heavily on outsourcing. And while it is now shifting some operations back to the U.S., it still relies on companies like TSMC for advanced chips and some third-party cloud providers for infrastructure.

So the Houston facility may be a step toward more control over its AI ecosystem, but this doesn't mean Apple is suddenly going to rival the likes of Google or Amazon in AI infrastructure. And I think we'll need to see whether they can make this work on the scale they're promising, or if this turns out to be just another ambitious announcement.

I think no U.S. news story today can avoid one person, that is President Donald Trump. And he's taking credit for this investment, claiming it's a result of his American first policies and tariffs. How much of this investment do you think is driven by political pressure and how much is genuine business strategy?

I think Apple and many other US tech companies have clearly been under pressure from the Trump administration to bring more manufacturing back to the US.

And Apple has actually long been under scrutiny for manufacturing the majority of its products overseas, particularly in China. And Trump has consistently criticized the company for not bringing production to the U.S. He even called on the company to, quote unquote, start building their damn computers in this country.

And the timing of this announcement also tells a lot because as you mentioned in the beginning, it comes right after Tim Cook's meeting with Donald Trump. There is a clear indication that Apple is trying to smooth over its relationship with the administration and avoid further political backlash. And the tariffs on Chinese imports, especially the 10 percent tariff on iPhones.

These are no small issue for Apple. And by announcing this investment, Apple is not only attempting to counterbalance these pressures, but also sending a message to the government that it is listening and it is willing to comply with the Trump administration's demand for more domestic production. So I feel that while there are certainly business reasons for Apple to invest in areas like AI and infrastructure, but this...

500 billion U.S. dollars investment seems almost like a direct response to Trump's pressure. Let's talk more on the 500 billion U.S. dollars. Where will the money for this investment come from? How realistic is it for Apple to scale up its domestic production and investments to the level they are now promising?

Yeah, that's a key question. We know that Apple generates about $100 billion a year in cash flow. But if we break it down, about 90% of that cash flow is currently being allocated to shareholder buybacks, which Apple has been very focused on in recent years.

So for Apple to redirect a large portion of that cash into such a massive domestic expansion, there's going to be some serious financial reallocation. And the other part of the equation is Apple's capital expenditures, because right now the company spends about $10 billion a year on data center infrastructure and other investments.

But if you compare that to the $125 billion a year that would be required to meet this $500 billion target, that's a big jump. And also the new facilities, the AI infrastructure will need long-term investments and Apple's current cash flow might not be sufficient to cover such a rapid expansion without diverting resources from other areas like its R&D or stock buybacks.

And also, Apple doesn't have a history of pulling off such large scale US investments quickly because we've actually seen similar promises before. Like in 2018, Apple pledged 350 billion US dollars in US investment.

But we've yet to see that fully realized. So while this figure sounds impressive, the logistics of it are far from straightforward, and scaling domestic production to this level could be far more challenging than it appears on paper.

And the real question is, will Apple be able to juggle these massive investments while at the same time still delivering returns to its shareholders? One last question. Do you think Trump's push for companies to localize their production will truly benefit the American economy? Or could it result in higher costs for companies and higher prices for consumers?

Well, of course, on the surface, the idea behind Trump's push to localize production is to boost American manufacturing, create jobs and reduce reliance on overseas supply chains. However, one of the key challenges with localizing production is the cost.

because manufacturing in the US is generally more expensive than in countries like China or Vietnam. Labor costs in the US are significantly higher, and the costs of materials, energy, and even regulatory compliance can add up quickly. And companies might try to offset these costs by automating production or finding efficiencies, but

I mean, at the end of the day, these higher production costs will be passed down to the supply chain. And this could mean higher prices for consumers, of course. Thanks, Zhao. My colleague Zhao Ying. Coming up, China's marine economy has achieved a landmark in 2024, surpassing 10 trillion yuan and driving national growth. This is Road Today. Stay with us.

China's marine economy has achieved a landmark in 2024, surpassing 10 trillion yuan or about 1.4 trillion U.S. dollars and driving national growth. An annual report from China's Ministry of Natural Resources showed the country's gross ocean product increased by about 6%.

percent last year, reaching around 10 trillion yuan. Offshore energy facilities saw rapid expansion, with offshore wind power generation growing by nearly 30 percent year on year. The report said the service sector was the largest contributor to the last year's growth, accounting for about 60 percent of the total gross ocean product.

Marine manufacturing, another key driver, contributed over 30%. But how exactly is this booming marine economy reshaping China's broader economic landscape and transforming the nation's energy security? For more on this, my colleague Gao Yinshi talked with Zhou Mi, Senior Research Fellow with Chinese Academy of International Trade and Economic Cooperation.

China's marine economy exceeded 10 trillion RMB in 2024, representing a substantial share of GDP. What are the primary macroeconomic drivers fueling this growth? We know that China has a lot of provinces, and many of the provinces are just coastal areas. So they are not only trying to make better use of the land resources, but also trying to do more

to do better with the ocean. But in my understanding, the marine economy is not just trying to make some profits from the ocean. We are going to protect the ocean together and trying to benefit by some of the development in the ocean. So China is a very important country in the world. We are trying to have a better ecosystem with better environment protection.

So many of the provinces are trying to do more to have their own independent innovation based on the marine economies. Many provinces like Shandong, Guangdong and Hainan also, they are trying to do something of their own styles. Well, we are encouraging those provinces to do more innovation based on their requirement and some of the resources.

Manufacturing accounts for over 30% of China's marine economy. How does this marine-based manufacturing differ from traditional inland manufacturing? And what broader impact might it have on the national manufacturing sector? According to my understanding that a lot of pervencers are trying to develop these things like the ships or some of the floating vehicles or platforms on the oceans.

So they are trying to make it more sustainable for the people who can stay on the ocean and trying to do more like the scientific investigation about the resources at the bottom of the ocean and also trying to make a better of monitoring of the fishes and also the other areas.

So in my understanding, the manufacturing is not only about the shapes. They are also to do with some of the equipment that we have to do when we are going to process the things, the harvest from the ocean. And another one is about, you know, the energy resources. We know the manufacturing also covers a lot of areas. Like we can find that the wind turbines are planted on the oceans. Maybe some of them are in the shallow areas at the bottom of the ocean, but others are

have to be floated. So I went to several provinces and I watched those factories. Many of them are going to be efficient and some of them have to be very environmental. They have to take care of those factors. So the manufacturing is quite different because it's not that stable. And in the ocean, there may be more impacts from the

and the nature like the waves like the wind and sometimes there are even strong typhoons so actually they are more challenging for the people who are going to be able to be sustainable on the ocean

Offshore energy facilities are undergoing rapid development, with offshore wind power generation rising nearly 30% year-on-year in 2024. How will this growth shape China's national energy landscape? Actually, you know, I visited many of the provinces and they told me that, you know,

During the 14 to 5 year plans in the year between 2021 to 2025, almost all the shallow areas are covered by those wind turbines. So they are helping to make greener and more sustainable resources. We don't have to use too many fossil fuels to meet the demand of the industries and also the conceptions.

In the coming five years, people are trying to discuss whether it is possible for us to extend the areas for the wind turbines. And this is not just a platform for the energy generation, but also some of them are developed into a place for the people to go to pay a visit.

some of the tourism are also discovered in those areas. And it is quite a kind of very interesting scenery. Like if you go to some other countries, you can know that the wind turbines are some of the symbols in certain countries. So if we are going to do more, I think that there are so many new areas that generation of the electricity is greener and they are helping for making a better the hydrogens and also to help development of

the renewable energy and that is also the support for the industries like the new energy vehicles and other areas. As a vital economic pillar, how does the marine economy enhance China's macroeconomic resilience against global disruptions such as supply chain shocks or commodity price volatility? The oceans cover the most part of the earth.

So if we are going to say that the resources we have used before, we may discover many resources like the minerals and also some other factors. But maybe we are not so able to discover those resources under the ocean. So actually, in my understanding, it is much more for a better and much larger space for us to use in the oceans. So we are going to make a better use of that.

But I have to say that according to the agreement in the WTO, the members have agreed that we have to be careful about subsidies in the illegal fishing and some of them are very harmful for the biases.

So we have to take care of the biodiversity. So in my understanding, the Chinese government really cares about those issues. So we are going to support a more diversified development of the marine economy, like to provide a better source of the protein for the people who are going to have a better life so they can consume more fishes. But at the same time, we have to be careful about the environment issues.

So I think that in such a world of so many uncertainties, like some of the materials are controlled and some of them are put more tariffs for China. I think that we are going to provide a better room for those companies who come here to China and also trying to discover marine economies, a cooperation with our neighboring countries or any other companies from other countries.

Looking ahead, how might the marine economy influence China's macroeconomic trajectory like GDP growth, employment and international competitiveness over the next decade?

The world is still not so advanced in making use of the resources in the ocean. I would say that there are still so many possibilities, like how can we purify the water and how can we make sustainable monitoring of those species of fishes, make better use of the energy, not only from the surface of the ocean, but also the current under the surface of the ocean. They are very strong and they are very powerful.

I think that all the provinces are trying to do more to discover the abilities for making better use of the resources, like they are having some of the scientific huge projects to try to understand the rules of the current, and they are going to use the energy of the manufacturing to be better in the using of those energy. I think that the potential of the marine economy is

quite large. It's not only about the logistics, it's about the way of us to making a life. I would say that there really are good important pillars for the development, especially in those provinces in China who are adjacent to the oceans. Well, on the other hand, I would say that the cooperation on the marine economy is not only by us.

We have many of the interactions with our neighboring countries. For example, the ASEAN countries, they do have quite a big demand for better use of the resources. They want to have better connections. So the interconnections on the oceans are very important and possible.

We can do more to strengthen the connections for the global supply chains and trying to improve the connections in the industrial chains cooperation in this region. And that will provide a much more diversified development strength for the development for Chinese economy and our neighboring countries' economy.

That was Dr. Zhou Mi, Senior Research Fellow with the Chinese Academy of International Trade and Economic Cooperation. That's all the time for this edition of World Today. To listen to this episode again or to catch up on previous episodes, you can download our podcast by searching World Today. I'm Guiana in Beijing. Thank you so much for listening. Bye for now.

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