Dear reader,

There were no surprises at the gathering of the national legislature this year as China’s lawmakers planned for the next five years and projected stability in the centre of the nation’s capital. Beyond the security barriers, though, much of the country was suddenly clawing to get their hands on an AI agent that promises to bring an automated touch to personal life. Still farther afield, the rules of engagement were coming under fire in the skies over the Middle East. If there is a new mantra, it’s prepare to be disrupted. 

For a deep dive on US-China relations, read our exclusive series on the run-up to Trump's visit to China. 

The Big Picture

The rare earth element  
China’s dominance in rare earths may change the course of the US' war with Iran and give Beijing leverage when the two superpowers talk.

• Why it matters: 2026 is expected to be “a big year” for China and the US
• Also, Marco Rubio has been sanctioned twice by Beijing, so will he come to China with Trump?
• In any case, what can the Xi-Trump summit achieve to rehabilitate the relationship?
• And, how can China win friends and influencers?

Iran aftermath
The ramifications of the US-Israeli war on Iran are wide-ranging, affecting sectors from energy to chemicals and logistics.

• Why it matters: the conflict raises big questions for China about its non-intervention policy
• Meanwhile, Iran’s strikes on US bases could be a preview for the Asia-Pacific
• Also, what does the US’ redeployment of THAAD from South Korea to the Middle East mean for Beijing?
• And, the war deepens the divide in the EU over whether the bloc should be bound by global norms

Lobster traps 
Chinese local governments have rushed to ride the OpenClaw AI boom, but Beijing is worried about security risks.

• Why it matters: it shows the contrast of priorities between local and central governments
• Beijing has issued a series of security alerts, including for the central bank
• And, users who had paid for the software have started to remove it
• Meanwhile, the PLA warns the US that AI cannot determine life and death in warfare

Wins and Falls

Song Ping is remembered as a veteran Chinese revolutionary who lived through five generations of Communist Party leaders  

Chilean President Jose Antonio Kast needs to walk a fine fibre-optic line between China and the US

Geely overtakes BYD as China’s top carmaker by sales 

Big Numbers

15.8% – the rise in China’s crude oil imports in January and February from a year earlier

21.8%  –  China’s export growth in the first two months, the fastest pace in four years 

-72% – the drop in China’s arms imports over the past five years

Direct Quote

“In Washington's Middle East policy, a major shift is that it no longer depends on its oil, as the US now has sufficient domestic oil and shale gas. However, strategic transport routes such as the Strait of Hormuz, the Bab el-Mandeb, and the Black Sea-Mediterranean passages remain its vital interests.”

Pan Guang, a leading Chinese expert on Middle East studies, weighs in on the geopolitical impact of the Middle East chaos.