What could happen following US bombing of Iran’s nuclear sites?
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Hello and welcome to World Today, I am Ding Han in Beijing. Coming up, Iran is winning retaliation following American strikes. NATO signs off on a pledge to increase defense spending to 5% of GDP.

China's high-tech industries attracted more foreign investment over the course of this year's first five months. And Hong Kong and the Chinese mainland launched Payment Connect for the sake of faster cross-border payments. To listen to this episode again or to catch up on our previous episodes, you can download our podcast by searching "World Today".

Israel and Iran have continued to trade strikes after the United States attacked three Iranian nuclear sites.

Israel says it attacked six Iranian airports on Monday, damaging relevant facilities and aircrafts. Iranian media in the meantime has released footage showing Iran shooting down Israeli drones. According to Iranian media reports, Iran has also launched a cyber attack against Israel, obtaining large amounts of data with regard to Israeli journalists and celebrities.

Iranian Supreme Leader Ayatollah Ali Khamenei vowed to punish Israel in his first public comment following the American attacks. U.S. President Donald Trump claimed that monumental damage was done to all nuclear sites in Iran. However, the International Atomic Energy Agency, or the IAEA, says the damage is unclear.

Iran's President Massoud Pesachian says the U.S. attacks have revealed that Washington is the main factor behind Israeli attacks. So for more, joining us now on the line are Zhang Shen, visiting research fellow with Koch University in Istanbul, Turkey, as well as Professor Greg Barton, professor of global Islamic politics with Deakin University in Australia. Thank you very much for joining us, gentlemen.

Thank you. Thank you. Okay. So, Dr. Zhang Shen, to start with you, first of all, do you think it is fair to say that the United States attacks on the Iranian nuclear facilities have added coal to the fire?

I think, yeah, it is very fair to say so. And I cannot stress enough how much of a damage, I mean, not in like practically damage of the airstrike, but like the psychological and the political damage that the United States has caused for the overall stability in the region. Because as we know, what is happening is that the reason why the Israelis launched the attack is basically to drag United States into this war.

And the Israelis know that by themselves they were not able to take out Iranian nuclear facilities and they are not able to topple the Iranian current government. And Netanyahu's hope is just to, by launching the attack to drag the United States into this attack,

And if the United States launched an air attack against Iran, eventually this cycle of tension would escalate that eventually the United States might send ground troops into Iran, which would evolve into a much larger, much massive scale of war.

And Donald Trump basically did whatever Netanyahu was hoping for. And this is a very dangerous precedent. And first, by attacking nuclear facility is a very dangerous thing. You could have caused a lot of contamination and nuclear explosion even. And the second, what he's doing is that he's probably starting a war that United States might send ground troops eventually into the Middle East.

And the Middle East might be dragged into another massive war that is in the same scale with what happened in Iraq. There's atrocity wars in Iraq and in Libya. And for that reason, I think it's very fair to say that this is a very terrible news for everyone in the region. Okay. So, Professor Greg Barton, turning to you, what do you think has prompted the United States to launch the attacks?

I think that answer can be short or long. The short answer is Bibi Netanyahu, the

Prime Minister of Israel, I think the pitch he made to President Trump was, you know, first of all, understanding very well his weakness, appealing to his ego, to his vanity, saying only you can do this, but it'll be quick. You just do this one airstrike. That's all we're asking of you. Send the B-2s and it's one and it's done. And you don't get dragged into anything else. But, you know, only America can do this.

So I think Trump sort of found this very attractive. I mean, we understand that in his team, in his administration, there are hawks who want to attack Iran and there are many isolationists. Most of the mega-American crowd don't want America

America to get drawn into wars and are against activity in the Middle East. So sort of counterintuitively, Trump didn't follow his base of MAGA isolationists. He was influenced by the hawks. But I think Netanyahu played the biggest factor. And, you know, just quickly to sort of explain the context, it has to be acknowledged that the Israelis have achieved remarkable intelligence penetration inside Iran.

And so Iran's weaker than it's been in decades. Hezbollah is not in a position to respond as a proxy. The Houthis still are, but that's limited to where they act. Hamas is basically destroyed. Syria is closed to Iran. There's still militias in Iraq, and that could be a problem for America yet. But inside Iran itself, the regime has been penetrated by Israeli intelligence. So it's a moment of weakness.

Netanyahu saw this moment of opportunity and he persuaded Trump to join him and said, you just do this one thing, that's all I'm asking. And it seems that that appealed to Trump. So, Professor Barton, by the way, do you think some countries, for example, Pakistan, they have a point when they were condemning the U.S. for attacking Iran by saying that

the U.S. strikes have constituted a serious violation of the international law and the statute of the IAEA. Yeah, Pakistan does have a point. I mean, it's the reality of international relations that countries often make fair points even though they themselves are not consistent in the way they behave. We have to listen to the argument.

To put it another way, it's really hard to see how you could possibly argue in terms of international law that this was...

necessary and even permissible attack. America was not under a direct threat from Iran. There was no immediate need for America to respond. Even in the case of Israel, you understand why it's done what it's done in Iran, but there was no immediate threat. It was a question of opportunity. So it's really very hard to defend what's happened in legal terms. In terms of real politics, you might make a case.

and maybe even understand why it was made, that on the basis of international law, this just does not fit any permissible structure. Okay. So, Dr. Zhang Shen, going back to you, realistically speaking, do you think the United States, its strikes, have achieved the Trump administration's objectives, whatever it might be?

I think the first important question is to ask what is the objective in this case, because they don't have a clear one. Trump has this habit, this very bad habit of trying to brag about anything he has done. If he has achieved 1%, he wants to brag it to like 100%. And we see that same thing with his domestic politics.

his so-called 100 days of reforms of the doge. And also we see that in the tariff war as well, is that he has not really achieved anything, but he bragged that, oh, I have achieved a great victory. And if you look at the White House official website, you see that he's

They actually have a page saying that, oh, wins comes every day under Donald Trump. And they list out all of those wins, the so-called victories he has achieved. And the reality is that most of those are not really that great of a victory. And I think this is another case of it.

it. The IAEA has said that they don't know how much the damage that the U.S. air raid has caused to the Iranian nuclear facilities. And we have not really seen any actual concrete evidence saying that the Iranian nuclear facilities are destroyed or permanently damaged or anything like that. It is more possible, I think, is more a symbolistic attack made by Donald Trump to

to like basically like for his domestic propaganda he wants to show up to people that he's always leading United States to win and he's always this tough guy and causing all of those victories and the reality is something that he does not really talk about and as for the objectives they don't have a clear objective Donald Trump's and I think his Twitter he says oh maybe we're considering toppling the Iranian government

governments were trying to do a regime change. But J.D. Vance just said yesterday that we don't have any interest to promote a regime change at this moment.

So they don't have a clear policy. They don't have a clear strategic goal. And Donald Trump's policy is just like he a lot of times do a lot of things according to his mood. He has done this thing in 2019 where he just launched missiles to bomb Syria. And there's no follow up after that.

Or like the same year he was assassinating Soleimani and when the Iranians retaliate against US bases, he didn't follow up with anything like that. So that is the reason why right now there's this famous political slogan or like they say meme saying that Trump always chickens out.

is that he does not really have a clear policy to push, and he does a lot of things in an improvised way, and he often just chickens out if that thing doesn't work for him. But Trump is really unhappy about this phrase, "he is chickened out," right? So, Professor Greg Barton, Donald Trump has expressed openly that he has no desire to drag the United States into another war.

In reality, do you think the U.S. strikes are pulling America into this conflict fully? I mean, is there still room for diplomacy between Washington and the Tehran? Professor Greg Barton? There is still room for diplomacy. That hope is not finished. If it was a different administration in Washington, I think we'd be more optimistic. Given that Trump has been

so belligerent about international rules-based order. I mean, he picked a fight with Mexico and Canada, his two neighbours. You know, Canada he has nothing to complain about, but he threatens that Canada really should become its 51st state. He's threatening semi-seriously to take over Greenland, the Panama Canal. I mean, he's trashed America's soft power, destroyed American institutions, so he's not really serious about international diplomacy.

So in that context, you know, this is not an optimistic setting for diplomacy. The State Department has been badly run down. There's just no interest in supporting diplomatic efforts. But Tehran is in a really weak position. It's lost its proxies, its buffer of proxies, apart from the Houthis and militias in Iraq. It's had this devastating Israeli intelligence penetration. It doesn't know who to trust.

It's probably gone through the majority of its ballistic missiles that it could throw at Israel, and so far it's not achieved much. Its air force can't fly. The Israeli air force basically is able to enter the Iranian skies at will. So it's a terribly humiliating position for a regime that is very proud and for a people that's very proud. The one upside is that this rallies the people to stand by a regime that they almost universally loathe.

but it doesn't give the Iranian regime good options. So they may well, at the moment they're playing the card of being a victim and there's a lot of credibility because, you know, what Israel has done, what Trump has done, it's hard to justify in terms of any international, you know, legal basis. So it makes sense for them to play the victim. That leaves open the opportunity that,

that perhaps they can get some traction with diplomacy, at least globally, if not with America, that they can't get by any other means. So it's not without hope, but it's a pretty miserable situation. This is a very risky situation that everyone's in. So, Dr. Zhang Shen, would you agree in this point that Tehran is currently in a weak position? I mean, what options does Iran have if Tehran wants to retaliate in response to the U.S. attacks?

I do agree that Tehran is really in a weak position at this moment and because this war is imposed on them, it's not them imposing this war on the United States or Israel, it's like the vice versa. And of course they're not prepared and the

There's, as our professor already mentioned, there's this Israeli intelligence infiltration and a lot of military threats as well. So there's a limited way that Tehran could react, but it could react on a lot of ways. You know, like, first thing is that they could have...

launch more attacks not only against Israel but also against the US bases in Iraq and even in Jordan or any other places. And there's one interesting thing is that actually the US bases is more nearby Iran than Israel is. To attack Israel they have to use longer range missiles.

But to attack US bases, they could have to use like shorter range missiles, which they have more and is much more easier technically for them to do so. So that's probably something they would do, which would escalate the war into a...

Mm hmm.

to decide whether they're going to do this or not. And by doing so, they could have caused a lot of... They could have done something similar to what the Houthis have been doing in the Red Sea, right? They could say, like, oh, we're only attacking U.S. ships or Western ships, or any ships dealing with Western countries in trade. And by doing so, they could have caused a lot of economic problems

globally, but particularly for the West. So that's another thing they could do. And the third thing is that even though the axis of resistance was not really functioning at this moment following Syria's regime change,

But they still could have a call upon the people's frontier in Iraq, the people's mobilization frontier in Iraq to launch insurgencies against the U.S. bases and U.S. people, U.S. military personnels in the region. And they could have...

call on Hezbollah to launch some symbolistic, at least, attack against Haifa and those things. And of course, they're going to ask the Houthis to continue sealing off the Red Sea, which has already caused a lot of economic problems for the region, and especially for pro-US Arab regimes in the region. So for all of those things, they could have done in the next few months. And

It is true that they're in the more weaker sides of this war, but I do believe that as long as they survive, as long as the regime survives, they would pose some sort of long-term threats to the interest of the United States and Israel in this case, and just the same...

as after the Iraq-Iranian war, the Iranian regime was greatly damaged. But as long as they survive, there's more strategic pressure they could exercise in the future. Okay. Professor Greg Martin,

Do you think the current situation means that a broader Middle East war is already underway? And what can the international community do actually to try to de-escalate the conflict and prevent those regional turmoil from further impacting the global economic development?

Well, I think we're certainly in a terribly risky time, but I don't think it's hopeless. I'm not sort of downplaying the risks, but talking about closing the Straits of Hormuz through which 20% of global oil and gas trade flows, I'm sure that Tehran is hoping that, although it's not friends with the Gulf states, the Sunni Gulf states like Saudi Arabia and the UAE, I think it's still hoping that it can close

sort of negotiate in terms of realpolitik, that it won't close the Straits of Hormuz if it gets backed up in the region. That if these Gulf states come and say, look, it's time to back off Iran, we can't achieve anything more. So that's one hope. I think there is a temptation to use the Houthis because they have plausible deniability with the Houthis.

There's also obviously a temptation, apart from closing the Straits of Hormuz, to get Iraqi or other Iran-linked Shia militia to strike American troops, the 30,000 American troops in the Middle East. But the trouble is, the moment they do that, if 10 American troops are killed, America will rain down terror upon Iran. If 100 are killed, the retaliation could escalate.

We've already seen that the regime can't control its airspace. Those B-2 stealth bombers really were stealthy. The temptation therefore is for Trump via perhaps goading from Netanyahu to go back with different ordnance and take out key Islamic Revolutionary Guards Corps air bases and military bases.

So I think the regime is really cautious about provoking that sort of response, because this regime cares for one thing above everything else, and that's regime survival. In a way, the Revolutionary Guards Corps took control of Iran because of that horrible eight-year war with Iraq. But a war now is likely to end their regime. So I think that's one basis in terms of real politic for hope. Yeah.

So dating back to the history a little bit, late Harvard University professor Samuel Huntington

Once observed in the 1990s in his famous book The Clash of Civilizations that the US or the West promotes non-proliferation as reflecting the interests of all countries in the international order and stability, but other nations see non-proliferation as serving the interests of Western hegemony. He also said at the time that the hold-down efforts by the West

may slow the weapon buildup of other societies, but they will not stop it. Professor Greg Martin, do you think Dr. Huntington's observations back then are still relevant when we talk about the Iran nuclear issue today?

I think those observations are still relevant. There are many things in the classical civilizations that I disagree with, but I think this point, real politic, you know, it does make sense. One escalation we should watch out for here, I hope we can avoid it, but

It's not clear that those famous GBU-57 massive ordnance penetrator bunker buster bombs really achieved the impact they hoped to in Fordow. So if those most powerful conventional bombs

bombs can't achieve what America hoped to achieve, the temptation is to use tactical nuclear weapons. And the moment that is done, then the dam is broken. If America resists, or even Israel succumbs to the temptation of using tactical small nuclear devices in a limited battlefield strike, that would be very helpful in taking out underground caverns because they're so powerful.

then the world has never seen even limited tactical nuclear weapons used since the terrible attacks of Hiroshima and Nagasaki. That dam would be broken. There's a fair chance Russia would be tempted to use tactical nuclear weapons against Ukraine. And then we really would have all hell breaking loose. So that's something to watch out for. The flip side is that

if the regime if it can survive in tehran will probably take the the lesson that if it has actual nuclear weapons as for example north korea has then it might be left alone um if it makes the mistake of doing what a malmark haddafi did and gives up nuclear its nuclear program then it's vulnerable but if it actually can quietly over the next

12 months, 24 months to develop nuclear weapons, and it may still have most of its stock of enriched uranium, it may have got that out of the way, then it may see that as a buffer, as a security guarantee. So that's why another element as to why this whole situation is so very risky. So Dr. Zhangsheng, we still have about like one minute before we need to wrap up. So very briefly, your final thoughts.

I think one important thing we need to understand is that this idea of Iranian nuclear threat is imminent. It's clearly wrong. It's not the fact. It's basically, I would say, it's United States and Israeli propaganda. And the reason why this thing happened today is basically this is a spillout of the genocide in Gaza.

of what is happening between Israel and the axis of resistance in the last about more than one year, about one year and a half. So I think to promote true stability in the region, what we need to actually do as international community is to

Pressure is to stop the war and to pressure them to not to escalate the scale of the war against this country, that country, like in this type of very reckless and bold style. And without pressuring, without the United States and the rest of the international community truly pressuring Israel,

to stop the war, there would be no true stability in the region. Even if you destroy Iran, Israel would find another country to invade. So I think the really important thing is to try to tell the Israelis to stop the war and to promote some pro-peace movement inside of Israel. Thank you very much, Dr. Zhang Shen, joining us from Colch University in Turkey, Israel.

as well as Professor Greg Barton joining us from Deakin University in Australia. You're listening to World Today. I'm Ding-Hen in Beijing. We'll be back after a very short break. Hi, I'm Einer Tangen, a political and economic analyst and senior fellow at the independent Taiher Institute.

World Today is news without the hype and business commentary that is informed and up to date, presenting the facts and asking incisive questions. So join us if you are someone who needs to know what is happening in China as it is happening.

You're back with World Today, I'm Ding Han in Beijing. NATO allies have reached a deal on setting a new defense spending target of 5% of GDP. The demand was originally raised by US President Donald Trump and will be confirmed during an upcoming NATO Leaders' Summit later this week.

The new target represents a steep increase from the alliance's current target of 2% of GDP. In the meantime, though, Spain has struck a deal with NATO alliance that would allow the country to avoid meeting this new target. So for more, joining us now on the line is Professor Cui Hongjian from the Academy of Regional and Global Governance, Beijing Foreign Studies University.

Thank you very much for joining us today, Professor Cui. First of all, let's break down this 5%. So we are talking about 3.5% on hard defense like weapons and troops, and an additional 1.5% on defense-related investments like cybersecurity and military mobility.

Now, some people say against the backdrop of Donald Trump's spanning demand, this represents a novel solution that NATO has come up with. What is your observation? I think it's called a kind of a novel solution, but I prefer to use the word a kind of an alternative solution from a European side.

Because as we know, this 5% expenditure of military for most of European countries, it's a very, very difficult job and even mission impossible. So I think, yes, now here is a solution from European side to divide it into two parts. One of them, exactly just 3.5%.

from the real military expenditure. But another 1.5% is just in the name of a military expenditure.

So I think that it's a kind of, I mean, products of the gaming between United States and the European countries. Even at this moment, most of our European countries, they do have a willing to increase the military spending. But frankly, there is not enough for most of our European countries.

Now, a few NATO members like Poland and the three Baltic countries have already committed to 5% so far, but the deadline for reaching this 5% target has been reportedly has been set at 2035, basically 10 years from now. How do you think this reflects the different opinion on defense spending within NATO?

Even for some European countries, they do have a very, very big concern for any kind of security threat, especially from the so-called expansion of Russia. But frankly, I think we have to take the balance between the different budget. For example, even for this country like Poland and the Baltic states,

They do have a lot of demands to raise the issue to have some more military spending, but they have to deal with some daily challenges, especially for the budget and also for the debt. So I think that's a very, very important case for Poland and the Baltic states. They have to have a longer time

to reach the goal of the 5% target. I think it also will give very big influence to some other European countries, especially for some South European countries, because comparing with this Baltic states and also Central and Eastern European countries,

Most of the southern European countries do not have the same understanding about security threats from Russia. So I think that yes, it will give a case of how difficult for NATO to reach so-called solidarity on this issue.

So talking about Spain, why do you think Spain was able to get exempted from commitment to this new spending target? And do you think Spain is somehow setting a precedent here that will somehow prompt other countries to follow suit in the foreseeable future?

Certainly, I think this negotiation and also the consequences of the discussion between Spain and NATO to which I think are compromised, I think it will give a very, very big case for other member states of NATO to bargain with NATO and the United States, comparing with some other smaller member

states that Spain has bigger bargaining power and to have this negotiation with NATO. Of course, the reason for Spain say that it could not reach the goal, mostly I think from the budget reason. As we know, even now, Spain has a very, very big debt burden for its budget. Last year, it takes more than 100%.

of the debt in the GDP. So I think that's a very strong reason why Spain tried to get a special treatment from NATO. But of course, I think it could be a very, very remarkable precedent for other members of NATO. For most of especially Southern European countries, they will take the case of Spain and to continue and to try to negotiate it with NATO.

So the United States currently spends 3.4% of the country's GDP on defense. While the demand for a new target here was originally raised by President Donald Trump, now the U.S. president has actually openly suggested recently that this 5% target doesn't have to apply to the U.S. So do you think his position here or his indication here works?

will antagonize leaders from the rest of the NATO alliance? During the long time debate between US and European countries on the issue of a military budget, one of the big questions is how could use of this budget? Even for most of the European countries, they argued that even the United States

has the biggest military expenditure within NATO, but most of this expanding has been used for United States itself, not just for European countries. So I think it's just a kind of promise from Mr. Trump, say that once there is an increase of military budget for European countries, they just use by themselves.

So far, I think it's just a promise, but it's a very, very fragile promise. Because as we know, according to the current behaviors and also the style of policy from the Trump administration,

I'm afraid that it's just a kind of promise on the paper. Maybe in the future, once the United States try to take use of the European budget for its own military operations,

I think at that time the United States will have another kind of rhetoric to prove its legitimacy to take use of this expenditure from European countries.

The final question before we let you go and briefly, when there is a steep increase in NATO's overall defense budget or defense spending, do you think that will be conducive to the global safety or security?

In the past three years, as we know, because of the Ukrainian crisis, the European continent became the area in the world to have the biggest increase of military spending.

I think it gives a very negative stimulation to the whole safety and security on a global level. As we know, at the same time, especially if NATO will have a more aggressive

concept or strategy, especially not only within Europe and also to go out of Europe, I think yes, it will give some more negative influence on the stability for other regions. So I think now it's a negative message from NATO, from the United States, try to have this rearm policy

it will give some more influence on this, as we know, military release and even this issue of nuclear weapon. So I think how could we find out the solution or the balance between so-called security concern and also the peace building? So I think

Now, mostly I think it's time for NATO to review its experience on how to make a balance between security and peace.

Thank you very much for joining us. Professor Cui Hongjian joining us from Academy of Regional and Global Governance with Beijing Foreign Studies University. Coming up, China's high-tech industries attracted more foreign investment in this year's first five months. This is World Today. We'll be back.

You're listening to World Today, I'm Ding Hen in Beijing. Data shows that China's appeal to global investors remains strong. From January to May, over 24,000 foreign-invested enterprises established a presence in China, an increase of more than 10%. And during this period, foreign investment reached somewhere about 50 billion US dollars. High

High-tech industries led the growth, with foreign investment in sectors like e-commerce, aerospace and pharmaceuticals surging. Manufacturing attracted nearly $13 billion, the services industry drew almost $36 billion, and high-tech industries accounted for $15 billion.

Then, geographically speaking, investments from ASEAN countries or Southeast Asian region grew by over 20%. There were also significant increases in terms of the investments from the South Korea, Japan, the UK, and Germany. For more, my colleague Zhao Yang earlier spoke with Dr. Zhou Mi from the Chinese Academy of International Trade and Economic Cooperation.

So Dr. Zhoumi, thank you very much for joining us. First, what specific features or unique advantages do you think make the Chinese market continue to attract foreign investments? Well, we know the Chinese market is a very large one. I think that the large population has provided us with so many possible collaborations. So the FBI wants to have more inked

come from a certain areas, it's an integrated areas, integrated market. And China is providing this super huge market. And second, I think that China's government is really active in, you know, publish new policies. The policies not only coming from their own consideration, but also coming from the, you know, the anticipation or expectation from the market. So I think that is a really important one because the FBI can really have some good benefits

if they are going to invest here in China. And the third one, I think that is also coming from the consumer's habits of Chinese people. So the Chinese consumers are really like to try some new things, more innovative ways of doing business. Their interest, so they will like to try the

products and services from the FDIs. And the fourth one is about the supply chain. We know that China is really good at manufacturing and we have all kinds of manufacturing sectors. And the people here are well trained. So they are able to provide a very sound

solid support for the FBI if they're going to invest here in China. And in the first five months of this year, the high-tech industries lead the growth with foreign investments in sectors like e-commerce, like aerospace and pharmaceuticals surging. So tell us, why are these sectors attracted more foreign investment? For example, why the multinationals, you know, they are betting on Chinese pharmaceutical sectors?

Well, yes, pharmaceuticals are kind of areas that we, you know, the enterprise is taking very serious about the potential market because they need to have a long term of return. In China, we do have a lot of issues to do with health protections and also the problem of dealing with different kind of disease. So in this regard, I think the pharmaceutical companies want to come here to not only trying to use their already their medicines here in China, but also trying to

do some kind of research and development on the new medicines. I think that is a kind of a very good potential for them to do in this year. Well, I think that the priorities of the Chinese government are always sending very clear signals to the markets and the prices.

the Chinese markets are really are welcoming the FBI. So they were not hesitant to invest here in the short term. They can consider about the longterm of investment here. And the third one, I would say that there are still a very lot of competition here. The Chinese are traditional,

companies are doing something to do with the pharmaceutical or other areas of the innovative way of doing businesses. So the competition will make it even better for the performance and the locating of the resources. So the FDI from these new areas about new technology, they will come here to

trying to explore the possibilities based on their own advantages and also have more cooperation with the Chinese local resources. That is very important. They can distribute their innovative products or services to the other parts of the world.

And the Chinese economy has been transforming and upgrading. So how have those multinational firms adapting their business strategies here? And what sort of new opportunities are emerging for them?

Well, I think that the possible opportunities coming from several sectors, the first one is the technology itself. Well, we are seeing that the world is under a lot of changes, so many companies are trying to make the better use of the technology, but they are not able to have more returns if the environment is not stable or if there are more tariffs on the borders.

So, the Chinese market is super large, so we can do a lot of things to release this kind of concerns for those foreign FDIs.

And when they are coming here, they will try to think about what kind of things they are able to do. Something they are having by themselves, by intellectual property rights or other resources, but they are gaining even more here in China. Like for the example of semiconductors, we know that semiconductors sectors in China are developing very quickly.

they're coming from a group of enterprises and also the or kind of different resources be connected. So I would say this is a very important idea for them to decide to do something good here. And the new opportunities also coming up from some emerging areas like for the artificial intelligence. We know that artificial intelligence is still developing so they are needing some very good

scenarios or kind of places to be applied. I think that's an improvement of this technology on the manufacturing, the traditional manufacturing and also in the new areas can provide them with better scenarios as the owner of Niveda He has said that in the future what is the decisive factor for the artificial intelligence? It should be the market.

China will play a very important role in deciding which one will outcompete others. And we found that investments from ASEAN countries grow by more than 20% so far this year. So what are the main reasons for that? And could you give us some examples? How do you explain China's trade and investment relations with ASEAN nations? We've seen

The FDI from ASEAN search rapidly and vice versa. A lot of Chinese enterprises also go to ASEAN countries to set up their own plants, right?

Yes, you know the complementary advantages of both China and ASEAN companies are really huge. So if you are just looking back in the last decade, you can see that Chinese companies are trying to do some investment in the developed countries. So the relations are a little bit similar. I would not say exactly the same, but many of the ASEAN countries

countries companies want to come here to invest here to learn from us so I would say that you know the trade between our two parties are really huge we are the number one trading partners for each other so we can try to improve that status so according to many of the research the investment and the

trade will be transferred to each other in the different kind of scenarios. So the investment is trying to make a better use of the trade and the supply chains and that is helpful for them to give a more resilient collaboration with China market. And another reason is that Chinese companies are really well

the investment from the RDA in France. So the cooperation between these two sides are really attractive. They are also attracting more countries, more partners like those countries which is in the ASEP region but not in the RDA regions. So they benefit from the systematical mechanism to guarantee their benefits and they are able to do more coming from this investment and also strengthening of the supply chains.

Dr. Zhou Mi from the Chinese Academy of International Trade and Economic Cooperation talking with my colleague Zhao Yang. Coming up, Hong Kong and the mainland launch Payment Connect for the sake of faster cross-border payments. This is World Today, stay tuned. You're back with World Today, I'm Ding Hen in Beijing.

The Chinese mainland and Hong Kong have launched a new cross-border payment system. The system is designed to help financial institutions offer more efficient, convenient and secure payment services.

Users are now able to initiate cross-border remittances in renminbi and Hong Kong dollars via mobile or online banking channels. The People's Bank of China says the new system is another measure by the central government to support Hong Kong's development.

So for more, joining us now in the studio is my colleague Song Rui Xin. Thank you very much for joining us. Thanks for having me. So what benefits do you think this new policy will likely bring to residents on both sides? So the policy significantly improves the convenience and efficiency of cross-border remittances.

So as long as users have the latest version of their mobile banking app, they can access the cross-border payment connect function directly and initially transfer easily. So one key feature here is the ability to send money using just a mobile phone number. I mean, it's a little bit

eliminating the need to input full account details. This streamlines the process and makes personal remittances much more, I would say, user-friendly. So previously, cross-border remittances could take a long time. But now, with this system, users can complete interbank transfers anytime and anywhere,

through online or mobile banking with funds credited in real time. So for example, mainland residents can use the ICBC mobile app to select the cross-border payment connect option and choose either RMB or Hong Kong dollar as the receiving currency. So similarly, on the other side, Hong Kong residents can use ICBC Asia's mobile banking app to send money to the mainland. So this also brings, let's say,

convenience in the areas such as education, healthcare, tourism, and even cultural exchanges. So in theory, sounds like really, really exciting development here. How has the public, how has the general public responded so far? Are there signs that people are already actively, you know, utilizing this new system?

Yeah, I've had this question myself and like how are people actually responding? So I looked into it. From what I've seen, the public reaction has been pretty positive, especially among people who frequently move between the mainland and Hong Kong, like students, cross-border workers and families. So according to the Hong Kong Monetary Authority, the payment connect was operating smoothly with the number should be

6,900 northbound and 19,000 southbound transactions as of 6 p.m. yesterday. So and then I asked my friend who lives in Hong Kong and she's currently studying and she tried the system today and she said in the past her parents had to convert RMB into Hong Kong dollars before sending money and it would take hours or even hours

hours or even half a day for the funds to arrive. But with the new cross-border payments connect, they can now transfer RMB directly with the money arriving instantly. And I have also read a few reports on how locals in Hong Kong react to

Yes.

So now what they need to do is to enter a mainland bank account number and no background documentation required. And the funds were transferred instantly with no service fee. So all in all, the new system has reduced both the time and cost of cross-border payments.

So what does this new policy or new system mean for regional development, especially in the context of this Greater Bay Area Initiative that is trying to bring the Guangdong Province, Hong Kong and Macau closer towards each other? The policy or

the system supports the long-term strategic vision for Guangdong, Hong Kong, Macau, Greater Bay Area, which has been a national focus for our high-quality development. It strengthens economic collaboration between the mainland and Hong Kong. I mean, it enables more seamless capital flows and financial integration across the region. So this helps to...

I would say, meet the involving financial needs of residents and businesses alike, while also supporting the broader goal of economic integration within the Greater Bay Area. So in terms of economic integration between the mainland and Hong Kong, this initiative first and foremost facilitates talent, mobility and employment. I mean, first and foremost,

for Hong Kong residents working in the mainland and mainland residents who were like employed in Hong Kong, the cross-border payment connect make salary payments much faster and more efficient. I mean, employers can directly transfer wages to employees' bank account, like regardless of whether those accounts are based in the mainland or in Hong Kong. So, I mean,

I believe it offers timely support for Hong Kong and amid its ongoing economic recovery and it reinforces the city's role as a key financial hub in the region. Broadly say, the launch of cross-border payments connect is expected to further enhance Hong Kong's status as an international financial center. So in my opinion, this financial cooperation between the mainland and Hong Kong

I mean, this initiative reflects the central government's strong commitment to strengthening and consolidating Hong Kong's global financial role. And it is set to attract more financial institutions and capital to Hong Kong and expand the city's financial service capabilities and boost its competitiveness and influence in the international financial market. Hmm.

Since you talk about Hong Kong being an international financial center, so how do you think this policy might fit into this broader context regarding China's digital currency development? This policy aligns closely with China's broader push to modernize its financial infrastructure and promote the digitalization of currency. So while the cross-border payments can act currently,

currently facilitates traditional RMB and Hong Kong dollars transactions through existing mobile and online banking systems. It lays important groundwork for future integration with the digital yuan, and the real-time, low-cost and user-friendly features of this system mirror many of the goals behind the Digital Currency Initiative. Thank you very much for joining us. That was my colleague Song Ruixin joining us in our Beijing studio.

That's all the time for this edition of World Today, a recap of today's headline news.

Iran is winning retaliation following US strikes. NATO signs off on a pledge to increase defense spending to 5% of GDP. China's high-tech industries attracted more foreign investment over the course of this year's first five-month. Hong Kong and the mainland launch Payment Connect for the sake of faster cross-border payments.

To listen to this episode again or to catch up on our previous episodes, you can download our podcast by searching World Today. I'm Dinghan in Beijing. Thank you so much for listening. Bye for now.