Check China Out!

Some funny videos on China News

2008-04-25T19:08:00.004+08:00

Hey my CSExy classmates! Julian here! Chanced upon these videos on the net. They're by South China Morning Post (http://www.scmp.com/) and they're murderously hilarious!

Video #1: Debate on Who's the President and When it was confirmed (Note the pun and the news bulletin that scrolls below!)

Video #2: Bush's keynote address on Hu Jintao's visit to US

Pilot projects to teach kids Peking (beijing) Opera

2008-04-07T21:03:00.002+08:00

China's education department will start pilot projects to teach students in primary and secondary schools how to perform Peking Opera, one of the nation's unique cultural treasures.
"It is a significant move not only to Peking Opera itself but also the whole Chinese culture," Wu Jiang, president of the China National Peking Opera Company told Xinhua.
It will bring today's children and teenagers closer to the heart of Chinese traditional culture, he said, "Peking Opera is not only a form of art but also a concentration of cultural traditions."
The Ministry of Education is to add Peking Opera into music courses for primary and secondary schools in 10 provinces, municipalities and autonomous regions including Beijing this year, as part of the efforts to promote traditional culture.
In the coming new semester, 20 schools in Beijing will launch Peking Opera courses.
Peking Opera, with a history of more than 200 years, is a synthesis of music, dance, art and acrobatics and is widely regarded as a symbolic expression of Chinese culture. Many historical events are adapted into the plays, which in the past were an important primer on history and ethical principles.
The education department has chosen 15 pieces of Peking Opera, including both classical and modern ones, said Wang Jun, an official of the artistic education division under the city education department.
Teachers are asked to not only teach students how to sing and perform but also introduce to them the storylines and background information so as to help children develop understanding and taste about traditional culture, he said.
"We have found that many children are weak in traditional literature and arts," Wang said.
The schools will also invite Peking Opera performers to train music teachers, he said.
To make the course easier for kids, schools will begin with modern plays, such as The Red Lantern, one of the eight Model Plays written some 40 years ago, which tell stories of Chinese revolutionaries.
"The storylines and lyrics are closer to modern culture, compared with the classic ones that tell stories from hundreds of years ago," said Zeng Yue, headmaster of Shuangyushu school in northern Beijing.
Classical plays will be introduced to students in higher grades that are more informed about ancient literature. Students of the sixth grade will start to learn a classical play Zha Mei An that tells of Bao Zheng, a legendary judge from China's Song Dynasty (960 to 1279 A.D.) who investigated a case involving the emperor's son-in-law.
"I think that the plan is not aimed to foster Peking Opera artists or fans," Wu said, "It just opens a door to children, giving them a chance to develop interests in traditional culture. If they are not interested, at least they are getting to know something about it."

COMMENTS
I think that reviving Chinese Opera among school children is a fantastic idea. Lost in the world of consumerism and of newer culture and ideals, many Chinese children have never come across events so rich and steep in culture. But how the school children respond to this will also be an issue. The emphasis on education is school is on academics, and coupled with most Chinese children being an only child, and their parents' hope, it seems almost unlikely that children will see the importance of understanding and knowing their own culture. on a more serious note, they might even see it as a waste of time. I understand what China is trying to do, and i applaud them. But the question is, what makes them so sure that this will be a good idea which doesn't waste time and resources?

China and the environment

2008-04-07T20:25:00.004+08:00

Wen Says Visit to India Historic
Visiting Premier Wen Jiabao said in New Delhi Tuesday that his visit to India was a historic one with fruitful results.
Speaking at a press conference before ending his four-day visit to India, Wen said both China and India have seen fruitful results through the visit.

"It is better to say it is a historic visit. We all believe that China's stability and development are in the interest of India, and India's stability and development are in the interest of China. The stability, development and prosperity of South Asia are in the interest of the whole world," the Chinese premier said.

To specify the importance of the visit, Wen said it has produced three major results.

The first result was that the governments of China and India "have been able to sign a joint statement to which the two sides have announced the establishment of a strategic and cooperative partnership for peace and prosperity. This means we have actually taken this relationship to a new level."

The second result, he said, was that both sides signed an agreement on the political guiding principles for the settlement of boundary question. "This is a sign that we have taken the settlement of the boundary question to a new stage as well."

The third major result was that the two countries had adopted a five-year plan for the all-round economic cooperation and trade between the two countries. "According to this plan, we have the objective that we'll make our two-way trade volume at the level of US$20 billion in 2008 and US$30 billion in the year 2010," he added.

In addition, Wen said he had made extensive exchange of views with Indian Prime Minister Manmohan Singh and other Indian leaders on bilateral relations and international issues of shared interest and both sides had reached agreement basically.

COMMENTS
I think it's a good thing for themselves that China and India are both forging better bilateral relations. but the problem is, how will the rest of the world take it? it's a good thing for the 2 huge developing economies as they can exchange expertise and help each other's economy improve. but one major cause for concern is that when they get too pally with each other, it's almost as if they can become a threat to the rest of the world given their immense size of the population, economy and the source of labour. for example, between them, China and Indie account for a high percentage of the world's cheap labour. Imagine if they gang up and use their large population size to their advantage, wouldn't it spell trouble for the rest of the world who are so dependent on Indian and Chinese goods and labour? But on the other hand, it is not guaranteed that China and India can smooth out all their past wrinkles so easily. sure, it's easy to say on agreements and on paper, but practically, it's a whole new ball game. there are many other factors to consider, and if these existing problems have lasted for decades, what makes China and India think they can settle them with the help of agreements, in just a few years?

China confirms protests Uighur Muslims

2008-04-07T20:03:00.002+08:00

SHANGHAI — Chinese officials said Wednesday that they were grappling with ethnic unrest on a second front, in the northwestern region of Xinjiang, where Uighur Muslims protested Chinese rule last month even as Tibetans rioted in the southwest.
One Uighur demonstration, which appears to have been quickly suppressed, took place in the town of Hotan on March 23, at the same time China was deploying thousands of security officers across much of its southwest to put down Tibetan unrest.
Officials said the protest was staged by Islamic separatist groups seeking to foment a broader uprising in Xinjiang. China often accuses what it calls splittists and terrorists of being behind any ethnic disturbance. Human rights groups say that Chinese Uighurs, like Tibetans, have fought for greater freedom to practice their religion as well as more autonomy from Beijing.
The news of the protest in Xinjiang underscored the breadth of China’s problems with ethnic and religious minority groups in the country’s vast western regions, where there is a long history of unhappiness with Chinese rule. Ethnic groups Beijing has sought to pacify with economic development programs and suppress with a heavy police presence appear to be using the coming Olympic Games, to be held in Beijing in August, as an opportunity to press their grievances and attract international attention.
“A small number of elements tried to incite splittism, create disturbances in the marketplace and even trick the masses into an uprising,” a statement published on the Web site of the Hotan local government said in the first official acknowledgment of the disturbances.
Uighur residents of Hotan reached by telephone either claimed not to understand Chinese or refused to talk about recent events there. But Han residents said that as many as 500 Uighurs had protested. Some reports have said the Uighurs were objecting to restrictions on wearing Islamic scarves and head coverings. Some people who were interviewed, however, said the protesters were seeking independence. The demonstrators were arrested by the security forces.
Zhu Linxiu, a senior police official in Hotan, declined to comment about the protests, saying it was “inappropriate to publicize.” He refused to confirm the number of protesters or arrests, but said the demonstrators were “instigated by bad elements.”
Two weeks before the reported protest in Hotan, China announced the discovery of what it called a terrorist plot in Xinjiang, which it said involved the smuggling of combustible liquids onto a commercial airliner by a Uighur woman who had spent time in neighboring Pakistan.
Officials called the incident part of a terrorist campaign by a radical Islamic independence group, the East Turkestan Islamic Movement. Uighur groups have denied the reports and called them part of an effort to justify increased security in the region and the suppression of dissent before the Olympics.
In recent days, the Chinese government has also accused supporters of the Dalai Lama, the exiled Tibetan spiritual leader, of plotting a suicide bombing campaign against China, as part of a separatist movement.
On Tuesday, Amnesty International criticized the government for its crackdown on protests in Tibetan areas of China, and it said the country’s efforts to silence dissidents before the Olympics violated the government’s pledges to improve human rights before the Games. “The Olympic Games have so far failed to act as a catalyst for reform,” Amnesty International said in a statement. “Unless urgent steps are taken to redress the situation, a positive human rights legacy for the Beijing Olympics looks increasingly beyond reach.”
A Chinese Foreign Ministry spokeswoman, Jiang Yu, denounced the Amnesty statement as “biased.”
Like Tibetans in Tibet, Uighurs have historically been the predominant ethnic group in Xinjiang, which is officially known as the Xinjiang Uighur Autonomous Region. In both Tibet and Xinjiang, indigenous groups have chafed at the arrival of large numbers of Han Chinese, the country’s predominant ethnic group, who have migrated to western regions with strong government support.
Uighurs, like Tibetans, have complained that recent Han arrivals now dominate their local economies, even as the Han-run local governments insert themselves deeper into schools and religious practices to weed out cultural practices that officials fear might reinforce a separate ethnic or religious identity.
In telephone interviews, Han residents of Hotan and nearby areas said there was a long history of distrust and tension between the Han and Uighurs. Some Han migrants said that the atmosphere remained volatile and that the Uighurs had been inspired by the Tibetan unrest.
“Some jobless people here have heard about the situation in Tibet, and they also want to make trouble,” said Wang Guoliang, a Han grocery store owner in Hotan. “They want independence and they want to expel the Han, whom they dislike.”

COMMENTS
Discontent among ethnic minorities has always been a problem for China. I guess this is probably due to the fact that the Chinese government is not sensitive enough to these minority races. Drawing parallels with Singapore, our government seems more sincere when dealing with such racial and religious problems. But then again, China is not even half the size, nor does it have even 1/3 the population of China, so i concede that China's problems are definitely not easy to solve given the huge scale. China's biggest problem now is the emphasis it places on economic development, and this includes improving the standards of living of the Chinese people as a whole. If the Chinese government concentrates on just trying to improve living standards for economic wellbeing and development, while it neglects the wellbeing of its people, then of course, China will always have the problems of discontent and unsatisfaction present. And this, is why i think China's problems of racial and religions issues will always be present

TIME: The Glitter Factory

2008-04-06T21:53:00.003+08:00

The Glitter Factory

By Austin Ramzy
TIME: 27 March 2008

The people of the scrub hills of China's eastern Shandong province have an ancient get-rich-quick formula. Just find the home of the sun god. When he tired of flying in his chariot, the legend goes, he would rest in a gold-filled cave on Mount Luo. For thousands of years people have searched for the sun god's lair, and they're still at it today. At the Dayingezhuang mine 19 miles (30 km) south of Mount Luo, workers take an open elevator car for a 21/2-minute plunge down a dark, icy shaft. At the bottom, amid swirling condensation and suffocating dankness, they enter a large hall labeled as face number 5,206. The night before, an engineer used 2-meter lengths of dynamite to blast 150 tons of rock from the roof. Now two men use an earthmover to load the rock so it can be hauled to the surface, where it is crushed and mixed in a bath of chemicals to leach out the precious metal.

The sun god's crib it isn't. But for every ton of rock pried from the earth, two grams of gold will be produced. Last year the Dayingezhuang mine turned out 78,000 ounces of gold, worth more than $78 million at the current price of around $1,000 an ounce. There's more ore where that came from. The mine's operator, Hong Kong-listed Zhaojin Mining Industry Co., expects to get 80,000 ounces from Dayinggezhuang this year. It's a story that is playing out at thousands of other Chinese gold mines that, with metal prices soaring, are ramping up production — and changing the shape of the global gold-mining industry in the process. China's gold output has climbed nearly 50% over the past five years; the total surpassed 276 tons last year, enough to make China the world's largest producer of the precious metal, for the first time supplanting South Africa, which had been No. 1 since 1905. This isn't a fluke. China's surprisingly high reserves and growing domestic demand mean the country will likely remain the industry leader in coming years. Says Paul Atherley, managing director of Leyshon Resources, an Australian mining company: "China is going to become dominant in the world gold industry as a producer, consumer and explorer."

In a way, the country is merely regaining its former glory. The Chinese have been pulling gold from the earth since the Song dynasty 1,000 years ago. But after the communist takeover in 1949, mining went dormant for decades. Personal ownership of gold was banned as a bourgeois extravagance, and production rarely broke 20 tons a year. That started to change with economic reform in the 1990s. Small wildcat operations began to proliferate, and these relatively unsophisticated outfits dominate the sector today. While countries such as South Africa, Australia, the U.S. and Canada get most of their production from a few dozen large, efficient mines, China has an estimated 2,000 mines scattered throughout the country. And because of their sketchy practices, the smaller operators are "a problem," says Zhang Yongtao, general secretary of the China Gold Association. "Their technological standards are weak, their management is insufficient and they don't make money."

The backwardness of China's gold-mining business is apparent to anyone visiting Zhaoyuan, a Shandong province city of 580,000. More than 60 mines operating in the hills around Zhaoyuan annually unearth about 15% of China's gold — enough to qualify the little city as the de facto gold capital of China. Yet even with gold prices soaring, Zhaoyuan is hardly a boom town. Beyond the sycamore-lined downtown streets, which display the modest prosperity of a midsize Chinese city, you find block after block of drab, low houses. At night, the closest thing to an entertainment district is an unlit street with two drafty karaoke bars.

Locals say the money made by the mines flows mainly to investors located in China's wealthy coastal cities. It certainly isn't winding up in the pockets of workers. An average miner makes $420 a month. That's not a bad wage for China, but the work is tough and dangerous. China's mines are the world's deadliest, and while most of the accidents occur in coal pits, the government says 2,188 died in gold and other metal mines last year. Such poor working conditions persist in China because workers' rights are weak and there are no independent unions.

Still, better days lie ahead for Zhaoyuan and for China's gold-mining industry. Beijing began reforms in the mid-1990s, encouraging the hodgepodge of small operators to consolidate and allowing foreign companies to form joint ventures so that Chinese companies could learn modern management practices, financial controls, and environmental and safety standards. China now has several publicly traded gold-mining companies, among them Fujian Zijin Mining Industry Co., Lingbao Gold Co. and Zhaojin Mining Industry Co. Their IPOs over the past several years provided an influx of investment capital — Zhaojin Mining raised $282 million from its listing — and also introduced the mining industry to shareholder scrutiny for the first time. "There is a correlation between the huge rise in gold production in China and the listings of those companies," says Auslan Ishmael, general manager of the China International Mining Group, an industry association. "This definitely put pressure on those companies to get a good return." Zhaojin Mining, for example, has seen its revenue soar by more than 100% a year for the past four years.

One big reason why diggers are excited about China's future is because of the large amount of gold that may still be in the ground. "Some of the world's biggest remaining deposits are in China, for sure," Ishmael says. Now miners are going all out to find it. Nationwide the commercial-exploration budgets for gold and other metals have climbed from $20 million in 2003 to more than $300 million last year, according to Metals Economics Group, a Canadian research firm. China's Geological Survey Bureau says that last year five new gold deposits with reserves estimated at 600 tons were found.

Could the next BHP Billiton, the world's biggest mining company, be Chinese? Observers say it's possible, given high metals prices and China's untapped reserves. But listed domestic miners have ambitions beyond China's borders. Zijin, China's leading gold miner, last year purchased a company with gold-mining and exploration rights in Tajikistan and a stake in a Philippine gold and copper project. Zijin also led a consortium that bought a majority stake in London-listed Monterrico Metals, which owns a copper and molybdenum project in Peru. "All the big mining groups started this way," says Atherley, the Australian mining-company executive. "They get a good mine and they start acquiring. It is really down to corporate fate. That's the only thing stopping Chinese groups." Says Zhang of the China Gold Association: "We can keep this up for a long time." Having passed South Africa and with its best years ahead, "China won't have any problems remaining on top for the next 20 years." The country's miners may have reached the sun god's lair after all.

-Joslyn Chew-

TIME: Japan's China Weapons Cleanup Hits a Snag

2008-04-06T21:42:00.003+08:00

Japan's China Weapons Cleanup Hits a Snag

By Andrew Monahan

TIME: 31st March 2008

The news out of Japan is likely to compound the nation's failures in dealing with its wartime abuses against China: The Japanese company responsible for removing chemical weapons abandoned by Japanese forces in China at the end of World War II will not be able to complete its work, with a corruption scandal forcing its closure. That leaves Tokyo with no immediate replacement to complete the complicated cleanup, which Japan is obliged to finish by 2012 under an international treaty.

But critics say the fault lies with the government itself, for a failure of oversight that allowed the Abandoned Chemical Weapons Disposal Corp. (ACWDC) to misappropriate approximately 100 million yen ($1 million) of public funds. And they question the government's commitment to removing the weapons, which remain lethal more than 60 years after the war. Cleaning up these caustic reminders of Japanese aggression in China would be a practical way for Japanese Prime Minister Yasuo Fukuda to act on his stated desire to improve relations between the two countries. Yet, while a Japanese Ministry of Foreign Affairs spokesperson said that the cleanup "is extremely important for improving trust," the government has not indicated how it plans to get the project back on track — nor has it launched a tendering process for companies to bid for the contract.

The ruling Liberal Democratic Party draws important support from organizations that downplay or deny Japanese use of chemical and biological weapons in China during the war. And there are deniers in the opposition Democratic Party of Japan, too: Jin Matsubara, a Democratic parliamentarian known for denying the killing of Chinese civilians by the Japanese Imperial Army in Nanjing in 1937-1938, recently used his speaking time at a Diet session dedicated to discussing the weapons to question their very existence.

The Chinese government says that Japan left some 2 million chemical munitions — shells, bombs and barrels of deadly agents such as mustard gas, phosgene, hydrogen cyanide and lewisite. The Japanese Cabinet Office, which handles issues related to the weapons, declined to estimate the number, but Japanese officials have previously said there were at least 700,000. According to the Japanese government's Abandoned Chemical Weapons Office, most of the weapons are in northeastern China, but some have been found as far south as Guangdong Province. Buried in fields and submerged in streams by the defeated Japanese Imperial Army in 1945, they have since caused an estimated 2,000 deaths, according to Beijing.

Zhou Tong and Liu Hao were among those unlucky enough to learn first-hand about the lingering danger. The two boys, aged 12 and eight at the time, were playing in a river in northeastern China's Jilin Province in 2004, when they came into contact with toxins that had leaked from the abandoned arms. The boys lived, but the illness induced by their exposure forced them to drop out of school. The Japanese government refused to pay damages to the boys' families, despite acknowledging that abandoned chemical weapons had been the cause of their sickness. Such cases inflame longstanding animosities, and potentially threaten to further damage the already fraught relationship between Beijing and Tokyo.

Despite the cleanup stalling over the corruption scandal, Japanese officials claim Tokyo can still fulfill its obligations under the Chemical Weapons Convention to remove and destroy all such munitions left in China by 2012. Minoru Shibuya, the Japanese ambassador to the Netherlands, where the convention is enforced by the Organization for the Prohibition for Chemical Weapons in the Hague, said that "the government of Japan continues to attach top priority" to the project. According to an Organization spokesperson, Japan has reported "no foreseen delays" to meeting its cleanup deadline. But Japan's record does not leave critics confident: The current 2012 deadline is an extension granted after Japan missed its initial deadline of 2007. Key disposal facilities have yet to be built, and Cabinet Office officials declined to say how they would find a replacement firm to take over where ACWDC left off.

Amy Smithson, a senior fellow at the Center for Nonproliferation Studies in Washington, D.C., said that the technical difficulties and expenses for the cleanup are substantial, but that Japan has the technological base to get on with the project — if the political will is in place. "Not surprisingly," Smithson said, "the Chinese and some outside observers have criticized the snail's pace of destruction efforts." That pace has just gotten even slower, highlighting the difficulty the two countries continue to face in putting a nasty past behind them.

-Joslyn Chew-

GM charges Chery for alleged mini car piracy

2008-04-06T21:28:00.005+08:00

GM charges Chery for alleged mini car piracy

By Gong Zhengzheng (China Daily)

Updated: 2004-12-18 00:37

Contributed by Julian Po

US auto giant General Motors (GM) filed a lawsuit against China's Chery Automobile Co for alleged piracy of a mini car developed by its South Korean affiliate Daewoo.

Chevy Spark

Chery QQ

The lawsuit, launched in the name of GM Daewoo Auto & Technology Co Ltd, contends Chery's QQ copied the design of Daewoo's Matiz while Chery claims it developed the QQ on its own.

GM's investigation results showed the two vehicles "shared remarkably identical body structure, exterior design, interior design and key components," GM China Group said in a statement on Thursday night.

GM's joint venture with Shanghai Automotive Industry Corp (SAIC) and Wuling Motor Corp in the southern Guangxi Zhuang Autonomous Region began producing the Matiz under licence from Daewoo as the Chevrolet Spark at the end of last year.

Chery, a State-owned car producer formed in eastern Anhui Province, began making the QQ in 2002.

"The Chinese Government advised GM to resolve the issue through mediation or legal means," Ken Wong, general counsel of GM Daewoo, said in the statement.

"Despite our good faith efforts and the assistance of the Chinese Government in the past year, Chery has been non-responsive to mediation efforts, and has even stepped up efforts to export the vehicle to other markets," Wong said.

Chery's alleged infringement has also been impacting the 4,300 employees of the GM joint venture and nearly 100 dealers for their Spark model in China, said Tim Stratford, general counsel of GM China Group.

GM China Group said some 8,000 Sparks have been sold in China.

Sales of the QQ are much higher than that of the Spark because of its earlier launch and lower prices, but the Chery official declined to reveal specific figures.

However, an official from Chery defended the company's practice on Friday, saying: "We conduct product designs according to international rules."

"Chery is one of the key State-backed automakers with depends on itself for self development," the official told China Daily.

The GM lawsuit came after officials from the State Intellectual Property Office announced in September that Chery's alleged infringement does not exist according to evidence provided by GM, despite the QQ's similar appearance with the Spark.

Japan's Honda Motor sued Shuanghuan Automobile in northern Hebei Province for infringement starting in October.

Honda accused Shuanghuan's Laibao SRV of copying its CR-V sport utility vehicle, requiring a compensation of 100 million yuan (US$12.1 million).

The Japanese automaker began making the CR-V in April at its joint venture with Dongfeng Motor Corp in central Hubei Province.

Toyota Motor Corp filed a trademark infringement lawsuit against Geely, the privately-owned compact car maker in eastern Zhejiang Province last year, but lost the case.

Analysts say more intellectual property disputes between domestic and foreign automakers will emerge as a result of Chinese firms' lack of strong development capabilities and the more profitable car market in China than in developed nations.

"Chinese automakers must enhance their independent development capabilities, instead of copying others. Otherwise, we will lag further behind foreign rivals," Jia Xinguang with the China Automotive Industry Consulting and Development Corp, said in an interview with China Daily.
Around 90 per cent of China's passenger car market is controlled by foreign brands.

Sales of China-made vehicles are forecast to exceed 5 million units this year, up from 4.4 million units last year.

Julian's comments:

I feel like commenting on this but I can't because I already commented on 3 of my articles and 3 of others'! But anyway, this post is dedicated to all those who wonder how similar those 2 cars are like.

Then again, it's strange for GM (Chevy or Chevrolet) to not sue Chery for trademark! I mean... Chevy... Chery... don't they sound the same?

Mattel and China Differ on Apology

2008-04-06T21:04:00.003+08:00

Mattel and China Differ on Apology
Interpretation Sets Off Debate
By Renae Merle and Ylan Q. Mui
Washington Post Staff Writers
Saturday, September 22, 2007; D01
Contributed by Julian Po

After weeks of uproar and suspicion about the safety of Chinese-made products, an executive of the Mattel toy company met with China's top product safety official yesterday to issue an apology. Just what the apology meant, however, was caught up in translation.

Mattel says that Thomas A. Debrowski, its executive vice president for worldwide operations, was in Beijing to repeat what the company had already said in Europe and the United States, that it was sorry for the recall of millions of toys, and that it was doing all it could to prevent further problems.

The Chinese press heard it differently. The state-run New China News Agency said Debrowski "apologized personally Friday to a senior Chinese official for the massive recall of Made-in-China toys due to design flaws committed by itself." Other media outlets said Debrowski apologized for harming the reputation of Chinese firms.

To an American ear, the news agency reports sounded as if Debrowski was making an apology for any blame placed on China.

In the United States, however, Mattel said in a statement that some reports of the meeting had been "mischaracterized."

When Debrowski said, "Mattel takes full responsibility for these recalls and apologizes personally to you, the Chinese people, and all of our customers who received the toys," the company said he was telling Chinese product safety chief Li Changjiang what had been said elsewhere, including that a majority of the problems had been associated with design issues, not Chinese manufacturers.

The majority of Mattel's recalls, 17.4 million units, were associated with the firm's long-standing problem of strong magnets falling out of toys and endangering children who could swallow them, Mattel said in a statement. The rest, 2.2 million, Mattel blamed on Chinese firms that used lead-based paint, which is prohibited in the United States.

Mattel, of course, has every interest in maintaining a good relationship with China, even as it must shore up the confidence of its customers. The El Segundo, Calif., toymaker receives 65 percent of its toys from China and has made significant financial investments in the Asian country. Mattel's stock closed yesterday at $23.94 per share, up 38 cents.

The recall of nearly 20 million Chinese-made toys, including some Big Bird and Elmo products, and Barbie accessories came at a sensitive time. Chinese products had already had plenty of negative publicity, starting with the recall of tainted dog food, followed by recalls of toothpaste and then seafood with a banned antibiotic. The U.S. Consumer Product Safety Commission yesterday added Chinese-made cribs to the list, announcing the recall of 1 million of the products that pose a suffocation hazard. The crib problems were not linked to Chinese manufacturing but to design flaws. Still, the words "Made in China" were reported.

The recalls have led to a series of congressional hearings where China, along with U.S. regulators, were cast in a negative light. Sen. Christopher J. Dodd (D-Conn.) has proposed suspending imports of food and toys from China. "There has been a cascade and that's caused a U.S. consumer perception crisis of China, not all of it justified," said Drew Thompson, director of China studies at the Nixon Center.

"China has received a lot of blame for the recalls in the West," said Hari Bapuji, assistant professor at the University of Manitoba in Canada and lead author of the report, "Toy Recalls -- Is China the Problem?" "They do have problems, there is no doubt. But I think the blame they received was larger than their share of their responsibility for the problem."

In an earlier statement in China, Mattel had said that its recalls for lead-based paint had been "overly inclusive" and included toys that met U.S. standards. A Mattel spokesman could not say how many of the toys did not need to be recalled.

Mattel is "dependent on Chinese industrial capacity for its toys," said Eric Johnson, a management professor at the Tuck School of Business at Dartmouth, who has studied the toy industry's migration to China. "They have significant investment of their own capital" in the country "and don't want to lose it. I suspect that Mattel has a vested interest in expanding into the Chinese market as well."

The news agency report was the latest in a series of statements from the Chinese government that suggest a new public relations strategy is underway that plays up evidence China was being treated unfairly. On Sept. 7, for example, after a meeting between Indonesian and Chinese officials over Chinese candy that allegedly contained excessive levels of formaldehyde, China said, "Indonesian authorities yesterday acknowledged that formaldehyde exists naturally in food" and regretted its earlier criticism. In turn, China promised to re-evaluate its decision to ban Indonesian seafood.

The prospect of a potential Mattel apology to China was criticized by some in Congress. "While I'm not going to argue with a U.S. company's apology for recent toy recalls, most would agree that China should be apologizing as well to consumers around the world for exporting shoddy products and dangerous food," Sen. Charles E. Schumer (D-N.Y.), who has been critical of China's regulatory and export systems.

By emphasizing a public apology by Mattel, China gains a public relations advantage, experts said. "This is all about saving face and a private apology wouldn't have done that for China. They really needed this public apology," Johnson said.

Correspondent Ariana Eunjung Cha in Shanghai contributed to this report.

Julian's comments:

Eeew, and as a child, I kept mistaking lead-coated Thomas and Friends train tracks for chocolate bars...
...
...not Thomas Foo, lah!

Nevertheless, this is a typical case of overassumption, oversight and premature conclusion that China is to blame for everything. From the article, there could be a possibility that China has been used as a scapegoat for every MNC blunders; the fact that so many of these substandard products exist in China, has been exploited by these despicable corporations as an excuse for their own faults.

So, let this clear the smokescreen: when you see your child accidentally swallow a made-in-China Barbie's head, it might not have anything to do with China but the child un-friendly design of the doll. And who designed it? *pretends to not look at the holier-than-thou Westerners*

Oh, and here's my word of advice to Mr. Thomas (again, not Thomas Foo, lah!) Debrowski: fire your media correspondent!

Taiwan vice president-elect may meet China's Hu/ China to honour its commitment to send pandas to Taiwan

2008-04-06T20:28:00.004+08:00

Taiwan vice president-elect may meet China's Hu
Sun Apr 6, 2008 6:25am EDT
Contributed by Julian Po

TAIPEI (Reuters) - Taiwan's vice president-elect may meet Chinese leader Hu Jintao at a trade fair in China this week, local media said on Sunday, an unprecedented step that would underline the chances for a thaw after years of diplomatic chill.

The trip comes soon after a landslide victory by President-elect Ma Ying-jeou and running mate Vincent Siew in elections last month on a platform to repair strained ties with China, which considers the self-ruled island its own.

Siew, who heads the Cross-Strait Common Market Foundation, will be leading a Taiwan delegation to the annual Boao Forum For Asia in China's southern island province of Hainan.
"Mr. Siew should be able to go. China hasn't said no and that's why we've decided to announce to everybody that we'll be going to the forum on April 11 and returning on April 13," Yu-chi Wang, spokesman for the delegation told Reuters by telephone.

Wang said it was not confirmed whether there would be a meeting between Siew and Hu, though local media, including Taiwan's TVBS television station and the United Daily News, said the two might meet since Hu would be attending the event this year.

The Taiwan Affairs Office was unavailable for comment.

Official talks between China and Taiwan have been suspended since 1999, when Taiwan's former president, Lee Teng-hui, redefined ties as "special state-to-state" relations.

But with the election of the more China-friendly Ma, some analysts believe more than half a century of hostility and tension between China and Taiwan might finally come to an end.

Siew, an ex-premier who has also held top economics posts in Taiwan, has been attending the annual forum in China over the past few years.

China sees Taiwan as a wayward province and wants to bring the island under its fold, by force if necessary. Despite political differences, trade ties have flourished and China has since become Taiwan's top trading partner and favourite investment destination.

(Reporting by Meg Shen and Ian Ransom in Beijing, writing by Lee Chyen Yee; Editing by Sanjeev Miglani)

Julian's comments:
Ah yes, aren't we tired of Ah Bian's antagonistic, obonoxious attempts to internationalise Taiwan by renaming national monuments?

Finally, we have two political figures in Taiwan who understand the benefits of a united China, albeit One China, Two Systems. I mean, for the interest of everyone, Taiwan + Hong Kong + Macau + reunification with Mainland = 三媳妇回娘家 = one big, happy family, right?

Mind the digression, but China should be commended for wisely refraining from interfering with 2008's Taiwanese elections. Considering the amount of negative news pin-pointed towards China recently, having "China and Taiwan: 4th Straits Crisis" on the headlines would officially snub the former's dream of hosting a great Olympics.

On the Taiwanese side, the growing evidence of their loss of competitiveness to China would, all the more, necessitate greater economic cooperation between both parties. And with Hong Kong now on China's side (Imagine David + Goliath versus, erm, Mini David) and Japan starting to recover from recession, Taiwan is beginning to feel the pressure of compromising national interests for economic ones. Like Steve Martin would put it, "If you can't beat 'em, join 'em!"

Besides, with all the failed pleas to secure a seat in the UN, and with so few countries on official diplomatic ties with Taiwan, being nice to the Big Bro. aka China would seem like the only way to truly internationalise Taiwan and give her the status that she desperately craves for. So, are you listening, Ah Bian?

UPDATE! New article on China-Taiwan relations!

China to honour its commitment to send pandas to Taiwan
From The Hindu News Update Service

Beijing (PTI) China on Friday said it stood by its commitment to send two giant pandas to Taiwan, a move seen by many as Beijings 'panda diplomacy' to soften its ties with the self-ruled island.

Chinas offer to send the pandas was earlier rejected by Taiwan's outgoing administration of Chen Shui-bian, apparently under pressure from pro-independence forces who saw Beijings move as a "propaganda ploy".

However, in a major boost to China's attempts at establishing closer relations with Taiwan, Ma Ying-jeou, who is in favour of closer ties with Beijing scored a landslide victory in the recent presidential elections.

The newly elected Taiwanese leader recently gave his approval to receive the two pandas from China.

He said as Taipei mayor earlier, he had supported acceptance of the giant pandas from China and "so I am in favour of receiving the pandas".

The panda pair, named Tuan Tuan and Yuan Yuan characters that go together meaning unite were healthy and happy at the Wolong Giant Panda Research Centre in southwestern Sichuan province of China, the State Forestry Administration spokesman Cao Qingyao said, according to Xinhua news agency.

"To let our Taiwan compatriots meet these two pandas at an early date, we hope that relevant organizations on both sides of the Taiwan Strait will start communication and negotiations as soon as possible," Qingyao said.

Taipei and Taichung cities and Hsinchu county are vying with each other to host the pandas from the mainland, after the victory of Ma Ying-jeou, Taiwan media said.

Taiwan had split from China during the civil war in 1949 but Beijing claims it to be part of its territory.

Read the Writing on the Great Wall

2008-04-06T20:14:00.003+08:00

Read the Writing on the Great Wall
Commentary: Read the Writing on the Great Wall
Jay Weiner for Business Week
Contributed by Julian Po

The world is watching China, and what it sees isn't pretty. But Beijing still has time to get the messageSeven years ago, when the International Olympic Committee awarded the 2008 Games to China, the Olympics were supposed to bestow on Beijing a sheen of progress.

Operating under the quintet of intertwined circles and the high-minded values that are trademarks of the Olympic Movement, it was thought, would compel Beijing's rulers to be more open, more democratic.

But now the five rings are starting to choke China. Instead of a sporting event that nudges the Chinese regime toward more fairness and transparency, the Games are serving only to highlight events such as the crackdown in Tibet.

Meantime, Human Rights Watch is spotlighting the squalid conditions of the migrant workers building Olympic venues, and on Mar. 31, Dream for Darfur is scheduled to release a "report card" on the response of Olympic corporate sponsors to China's support of "genocide" in Sudan.

To make matters worse, the IOC just announced that Beijing's miserable air quality might mean rescheduling endurance events. But no, there won't be an official boycott. The EU says it won't back one. And President Bush's Treasury owes too much money to China for the U.S. to rain on the most important parade since The Long March. Besides, a series of boycotts from 1976-84 almost destroyed the Olympics and punished no one but hard-working athletes.

"Boycotts don't work," says Jill Savitt, executive director of Dream for Darfur, a group pressuring China over its support of the Sudanese regime. "Boycotts are tired. They're old school. They're kind of fringy and lefty."

The political stage belongs to those who show up, not to those who stay away. Ask the angry Tibetan monks. So with a little more than four months to go until Opening Ceremonies, China's coming-out party has become a steady drip of organized protest. China's leaders can whine that there is no connection between politics and sports, but only the naive take them seriously.

The Olympics are a political event and have been forever thus. The Internet and YouTube—when they're not blocked by censors—will turn the runup to these Games into viral political theater. In the be-careful-what-you-wish-for department, the whole world will be watching China—and not just what Beijing wants it to watch.

ENDURING OPTIMISM

The touching contradiction is that, deep down, the people seem to want the Olympics to serve as a channel for what they call "public diplomacy"—the projection of the values and opinions of China to the rest of us, not the formal, measured diplomacy of dark suits in ornate rooms.

They're hoping for a transfer of good vibes. "Beijing's citizens want to be perfect hosts," says Zhong Xin, an associate professor of journalism and communication at Beijing's Renmin University and a visiting research fellow at the University of Maryland.

One fascinating finding from a survey of Beijing residents revealed that an overwhelming number saw the Olympics as an opportunity for "Chinese officials [to] show their capability in dealing with tough issues," Zhong says. So maybe it's helpful that all this dissent has come now.

China's decision-makers have time to digest the world's reactions and adjust their behavior accordingly. But if the leadership can't—or won't—read the clear signals, if they stonewall, if they censor, if they bludgeon, the Olympic Games will become a mere sideshow. And those five rings, once filled with so much promise, will become rings of fire.

Jay Weiner, based in St. Paul, Minn., has covered every Olympics since 1984 and will be in Beijing.

Julian's comments:

Like myself (an OCD sufferer,) China is realising that nothing can be perfect, not even an Olympic games. As China plays host to one of the largest world events, it is bound to be scrutinised by especially the foreign media.

Since it is impossible (and childish) for "a globalised world" to boycott the Olympics, as in the case of the 1980 Moscow and 1984 Los Angeles Games, China-bashers have decided to use the influential and outspoken traits of the media to publicise their atrocities, hoping to make the Beijing 2008 Games unforgettable... for the wrong reasons. Ah, those scheming jerks. *pretends to not look at the holier-than-thou Westerners*

However, considering the improvement in infrastructure and their ability to contain the Tibet unrests (for now,) China should be commended for doing a good job in preparation for their big celebration on 08/08/08.

What's more, if you were to look at the controversies of other Olympic hosts -- Salt Lake City's bribes on IOC members, Athens eleventh hour completion of olympic venues and London's "Har?! A hideous looking stadium for 470 million pounds!" -- all I could say is, thank goodness for bad air quality in Beijing. *smirks*

China will eat our lunch

2008-04-06T16:04:00.002+08:00

China Will Eat Our Lunch

Peter Schiff
NEWSWEEK
Nov 24, 2007
URL:http://www.newsweek.com/id/71991

Most economists attribute the recent spike in Chinese inflation (6.5 percent in October) as an inevitable consequence of rapid growth. Few question why a country that has made tremendous gains in productivity, and that is responsible for lowering prices around the world, cannot deliver lower prices at home. In contrast, similarly rapid industrialization in the United States in the 19th century produced sustained price declines for more than 100 years.
The truth is that high prices in China, and the rest of the world for that matter, are a direct result of low prices in America. When the Chinese government, and their counterparts in the Middle East and Latin America, finally move to snuff out local inflation, a massive realignment of global purchasing power will ensue, with Americans on the losing end.

Despite economists' efforts to obscure the obvious, prices are a function of money supply. More money chasing a constant supply of goods pushes prices higher. More goods introduced into a constant supply of money pushes prices lower.

To sustain its currency peg to the U.S. dollar, China must expand its supply of yuan to purchase the hundreds of billions of excess dollars that it earns annually by selling products to Americans. With few American products to buy, many of these dollars are held by China as currency reserves. This action lowers inflation in the United States by making Chinese goods cheaper for Americans and restricting the supply of dollars globally. Conversely, the supply of yuan expands rapidly and overwhelms the downward price pressures made possible by increased productivity.
However, as China's inflation problems make the maintenance of the peg increasingly untenable, the day will surely come when the Chinese allow the dollar to fall and their own currency to rise. Most economists fear this will kill American consumption, leading to global recession. My view: while it would sound the death knell for the golden age of American consumption, it would in fact be a boon for China.

The absurdity of an economic model that credits Americans' insatiable willingness to consume as a prerequisite for global prosperity can easily be understood when boiled down to its basic elements. Suppose five Asians and one American were shipwrecked on an island. To maximize efficiency the castaways devise a plan where one Asian fishes, another hunts, the third gathers fruit, the fourth gathers firewood and the fifth cooks. The American is assigned the job of eating. In the eyes of the modern economist, the American is clearly the engine of this microeconomy; without his heroic consumption, the economy would stagnate.

The truth is that consumption is a movable feast. Americans overconsume because the world props up the purchasing-power of our currency. As the dollar declines, so too will our ability to overconsume. But the purchasing power lost by America will be gained by countries whose currencies rise in relative terms. Factories around the world won't shut down if Americans stopped spending. Without the American to feed, the Asians would simply have more to eat themselves.

With a per capita GDP of $43,000 the International Monetary Fund currently ranks the United States fourth among all nations in economic output per person. At $7,600 per year, China ranks 86th. However, due to its massive population of 1.3 billion, China already ranks third in total economic output. Most forecasters assume the total size of the Chinese economy will eclipse that of the United States by the middle of this century. But by factoring in the weakening dollar and the inevitable slowdown that drop will inflict on the United States, the changing of the guard will occur much sooner, perhaps in the next five years. In short order, currency realignment could push the United States out of the list of the top 20 nations in terms of per capita GDP, behind such countries as Greece and Singapore.

My forecast is that as foreigners continue to walk away from dollar assets, the greenback will lose an additional 40 to 50 percent against the U.S. Dollar Index. Given that the yuan has been artificially restrained by the Chinese government for decades, its rise will likely be much steeper, perhaps twice as much as the index itself. Such revaluations would result in China's GDP quadrupling in dollar terms. At current levels, this puts the Chinese economy at nearly $12 trillion and the U.S. at $13.2 trillion. Based on this assumption, it would only take a year or two of oversize expansion in China and modest contraction in the United States for the economic crown to move across the Pacific.

In the current status quo, America plays the role of one of its cultural icons, Tom Sawyer, who convinced his companions that the satisfaction of whitewashing fences (or in this case providing goods on credit) was reward in itself. The day will soon come when China and the other emerging economies decide to tend to their own fences. When that happens, Americans will have to paint for themselves, and perhaps even make their own brushes.

Posted by: Elizabeth Tan 07s307

Welcome to the Guanxi wiki

2008-04-06T15:49:00.001+08:00

Welcome to the Guanxi wiki
URL: http://guanxi.pbwiki.com/

Guanxi is a Chinese term, generally translated as "networks" or "connections," that is increasing discussed in Western business circles and among academics studying such aspects of community as affective networks and social capital. Although guanxi is often characterized as uniquely Chinese, similar relationships occur in other nations, especially in East Asia. In China guanxi has become especially significant in the last fifty years because it provides individuals with a patterned, structured set of relationships that to some extent replace the social networks of family, village, and clan that are more difficult to maintain in the face of population relocations, urbanization, and Westernization. Guanxi is a mechanism for dealing with social uncertainty in a complex social environment.

Guanxi has been a significant element in Chinese business relationships for several hundred years, "an intricate and pervasive relational network which Chinese cultivate energetically, subtly, and imaginatively" (Luo 1997, 43). Wide webs of guanxi tie Chinese businessmen and Chinese firms into a cohesive and functioning economy. The success and even survival of many businesses rests on the establishment and maintenance of guanxi. For Western businesspeople, the idea of guanxi is a useful reminder that trust, understanding, and personal knowledge can be vital components of economic relationships. The development of guanxi is not something that takes place instantly, and this can be one of the frustrating aspects of doing business in China for non-Asians who are accustomed to striking a deal and moving on.

Most guanxi relationships are based on individuals' having something in common, a phenomenon called tong in Chinese. The commonalities may be the fact of having attended or graduated from the same school, having the same place of employment, working in the same industry, or coming from the same village or region. In addition, guanxi relationships may sometimes be established through gift giving or personal favors. They can even be arranged by an intermediary. Guanxi relationships often have a strong emotional element, something easily overlooked by outsiders.
The essence of guanxi is that each relationship carries with it a set of expectations and obligations for each participant. A guanxi relationship may lead a person to feel obligated to help someone get a job or a promotion, or, conversely, may lead a person to have the expectation that a connection will help with a job search or a promotion. Similar obligations or expectations can be held with regard to gaining entrance to a school or university, meeting with an influential official, getting access to a desired material good, or receiving (or offering) help to family and friends. Those who meet these obligations gain face and status and expand their guanxi network. Refusing to help is a sign of inhumanity and can bring disgrace.

Thus, in addition to the instrumental and emotional components noted above, guanxi also involves the notion of honor and respect, two core values in Chinese society.

Guanxi is of interest not only to Western businesspeople, but also to Western sociologists and network analysts. Pressing research issues among Western scholars and analysts include the content of guanxi ties, what types of ties and networks tend to go together, and the relationship between guanxi networks and other sorts of ties. Those studying online network building are particularly interested in *whether electronic media and global connections can allow the development of the kind of intricate human bonds the Chinese call guanxi.* Some people call the Internet and the other communication technologies of the twentieth century guanxi enablers. They point out that e-mail address books and speed dial lists make it quicker, easier, and more affordable to make contacts and keep those contacts fresh. There are in fact a variety of customs and practices in the West that reflect concepts similar to those used to explain guanxi, concepts and rules that define the relationship between individuals and groups.

For example, traditionally European etiquette required a person to be introduced by a mutual acquaintance, never simply to strike up a conversation with a stranger, even at a private event. Western practices that are intended to build extended personal networks include school and college placements, high school foreign exchange programs, college programs of study abroad, internships, and traineeships in different companies or different departments within a business. These programs are intended to expand the individual's personal connections on a lasting basis, not just to provide or enhance an abstract understanding of other people and cultures.

Western businesspeople appear to see guanxi as a kind of capital to be accumulated. Nonetheless, in the West ties tend to be less strong, less structured, and less based on expectations. Old or distant relationships are also less important in the West than they are in China. For those reasons some experts argue that it is a stretch to label as guanxi relationships such as those formed during foreign exchange programs or traineeships. It may be that the elusiveness of the concept is what makes guanxi appealing to people in the West. It provides a useful way to corral a wide variety of human connections under one term and to see that networks of relationships have a kind of life of their own.

From "Guanxi" by Karen Christensen and David Levinson in the Encyclopedia of Community (Sage 2004).

Posted by: Elizabeth Tan 07s307

Guanxi In China: Fugetaboutit!

2008-04-06T15:34:00.002+08:00

Guanxi In China: Fugetaboutit!
URL:http://www.chinalawblog.com/2008/02/guanxi_in_china_fugetaboutit.html

Co-blogger, Steve Dickinson, just wrote an article for China International Business Magazine entitled, "Debunking the Guanxi Myth." (if you are not reading this magazine, you should be) (h/t to Travis Hodgkins over at the Transnational Law Blog. Steve starts out talking about how so often after he has informed a client that a proposed transaction is illegal, the client tells Steve they do not care because "they are working with a powerful political or military figure who will ensure that the normal legal rules and documentation do not apply." Steve sees this as a mistake for the following reasons:

No foreigner can recreate a Chinese-style guanxi network. In China, guanxi refers to a vast network of connections arising from party, family and work connections that may go back several generations. No guanxi network relies on a single individual. The elimination of one member of the network is therefore not fatal. Foreigners almost always rely on only one or two individuals for their supposed connection. This kind of network is too fragile to be of enduring value. Foreign investors who think they have created a guanxi network in China are usually simply deluding themselves.

Connections with local government officials are short-term and can be abruptly terminated. Many foreign investors do not realize that government officials in China are regularly moved from office to office and from region to region. As a result, the connection with a local official is unlikely to be a long-term connection. It is quite common to negotiate a project for several years and then learn that the official in charge has been transferred to a new post. Where the project is not in compliance with the law, their replacements will often refuse to sign the documents that have already been negotiated.

The Chinese provider of guanxi may suddenly disappear. If the project depends on the protection of a single individual, what will happen if that person dies, is demoted, or prosecuted for corruption? This change in fortune can be a particular disaster where the foreign investor has already contributed funds, because the project can be cancelled with no refund on the investment.

A project based on guanxi gives too much power to the Chinese side of the deal. In many cases, the provider of guanxi will make use of the fact that the project is not in compliance with the law to ask for additional benefits. Since the foreign side has no legal recourse, the foreign side must accede to what is in effect a blackmail request or risk the collapse of the project. When the foreign investor comes to a lawyer for help, there is nothing that can be done, since the project itself is either illegal or poorly documented.

Steve recognizes the value of Guanxi, but not as a substitute for a soundly structured deal:
I do not mean to say that having good guanxi is of no value in China. It is of course beneficial in China, as in any country, to cultivate good government relations. Connections with the wealthy and powerful are also an advantage when working in a difficult investment environment.
However, these kinds of connections should never be seen as a replacement for carefully structured investment projects. All investments should be designed to comply with mandatory laws and regulations. The investment must be documented so that the foreign investor can defend its interests in the event of a dispute or changing conditions. Failure to follow this careful approach is the source of many self-inflicted foreign investment disasters that we see all too often in China.

Bottom Line: Be very skeptical of a China service provider who spends time talking about his or her China connections. Those who tout their connections/guanxi are almost always doing so because they have so little to say about their expertise and experience.

Comment:
This article provides advice for foreigners who are confident of relying on guanxi to see their investments through. For us China Studies students, it will help to understand better how guanxi works and the drawbacks of relying too heavily on it. The article is easy on the eyes and the mind!

Posted by: Elizabeth Tan 07S307

Where 'Guanxi' Rules

2008-04-06T14:32:00.002+08:00

Where ‘Guanxi’ Rules
Party politics, cross-Strait relations and good old greed still trump everything else in China.
Jonathan Ansfield
NEWSWEEK
Dec 8, 2007
URL: http://www.newsweek.com/id/74369

Chinese politics are often not what they seem, and a recent coup by citizens in the seaport of Xiamen is a case in point. In late May, Prime Minister Wen Jiabao ordered city leaders to freeze construction of a plant slated to produce PX, a toxic chemical used in plastic and polyester, after academics and journalists raised safety concerns. Then came massive street marches. Last week a long-awaited "independent" scientific review suggested building should resume only if the city limited pollution and residential building in the area.

It may have looked like folks were being heard. In fact, according to official media sources, orders to proceed with the plant had come two months earlier from none other than Communist Party boss Hu Jintao himself. Environmental issues didn't factor in his decree. Instead, the key issue was the plant's owner, Taiwan's Xianglu & Dragon Group, whose boss is a rival to (and fugitive from) the independence-minded regime in Taipei. Beijing, which still considers Taiwan a wayward province, sees any foe of Taiwan President Chen Shui-bian as a friend. Hu made the call in order to buttress "cross-Strait relations" and "Taiwanese business interests," say the sources, citing official written instructions.

The case underscores an increasingly common clash in China these days. On one side stand newly networked intellectuals, media activists and citizens; on the other, the traditional closed-door world of party-investor relations. Despite all the talk about the empowerment of ordinary Chinese, it is still guanxi—old boys' networks—and the party's private interests that generally carry the day.

That's particularly true for companies like Xianglu & Dragon Group, whose boss is an enemy of Taiwan's leader. In such cases, China is happy to help defuse criticism over environmental and other abuses. "National leaders are very tuned in to what people here are saying," says one state journalist in Xiamen. "But the Taiwan business backdrop [is] a big factor."

Big enough to trump the fact that Dragon's boss, Chen Yu-hao, is a fugitive from justice. He began building his first factory in China in 1992. As his mainland business prospered, his Taiwanese holdings collapsed, and in 2003 Taipei charged him with breach of trust for embezzling $126 million in assets from his Taiwanese companies. Taiwan put him on its most-wanted list; Beijing responded by granting him a passport. Chen denies the charges but now lives in China and Los Angeles.

The acrimony grew during Taiwan's 2004 presidential race, when Chen publicly accused Chen Shui-bian and his wife and aides of taking bribes during past campaigns—bribes the businessman says he himself had paid (party records list him as a legitimate donor). The office of the president, who was narrowly re-elected, blamed Beijing for the charges. That same month Chen Yu-hao got his license to produce PX in Xiamen—a first for a fully foreign-invested concern.
This was despite the fact that Chen's other plants in Xiamen had already been cited for repeated emissions infractions—a point noted in the recent assessment. Residents of Wencuo say they have complained for years to officials about exhaust fumes, leaks, and the odor of vinegar coming from a nearby Xianglu plant. The controversy over the PX factory began when Zhao Yufen of Xiamen University organized a petition to Beijing warning of a slew of potential hazards, including leaks, explosions and increased risk of cancer and birth defects. Executives on the PX project countered that the plant is safe and denied any string-pulling by Chen, officially a company "adviser." And they recently brought a defamation suit against Zhao and a colleague for allegedly exaggerating the dangers. "We hope this will clarify the matter," says one company official.

Authorities have good financial reasons to approve the plant; local officials boast it will double Xiamen's GDP. With presidential elections coming up in March in Taipei, however, political concerns may be predominating. Beijing is treating everything Taiwan-related especially carefully, says Zhang Wensheng of Xiamen University. It has even reached out to Taiwan's opposition Kuomintang Party, to which Chen has been a major donor.

The final go-ahead for the PX plant could come within weeks—barring another big public backlash, that is. Still, the city is taking no chances; it has detained about a dozen protesters and muzzled Web forums. Lian Yue, a prominent blogger, recently wondered how Chen could "repay good with evil" after the "Xiamen people gave him the opportunity to rebuild his fortunes." The answer is that it's Beijing, not locals or green activists, that will determine Chen's opportunities on the mainland.

Comments:
This article uses one named example to highlight the operations of 'guanxi' and its standing in China today. The example that is used shows the domination of guanxi and how it can reflects poorly of certain parties-the government in this matter. One can draw from this article that guanxi holds serious drawbacks for China. Mainly, the problems that may arise when party interests clashes with the citizens' concerns and the citizens are overruled. I think that this will generally result in dissatisfaction with government and a loss in trust about their ruling. As when priorities about environmental conservation gave way to political concerns, as highlighted above, it is an indication that the government of China is pulling the wrong strings to hold on to its sovereignty.

Posted by: Elizabeth Tan 07S307

China's African Misadventures

2008-04-06T13:47:00.007+08:00

China's African Misadventures
Beijing has dramatically outpaced its rivals in Africa. But at ground level, things don't always look so rosy.
Scott Johnson
NEWSWEEK
Nov 24, 2007
The town of Catumbela, in Central Angola, sits on a sprawling, fertile plateau planted with plantains and mangos. At the far end of town is a defunct paper mill. There, for several months earlier this year, a group of Chinese railway engineers and laborers camped out in the shadow of two idle smokestacks. The team was one of several sent to this isolated stretch of Angola's interior to build a railroad that will one day connect the African hinterlands to the Atlantic port city of Lobito, several hundred miles to the west. It's a $2 billion project and a colossal dream—a way to bypass Angola's sparse, decrepit roads, which like so many in Africa are strewn with land mines and liable to be washed out by flash floods.

There's only one problem: work has stalled. Along the railroad line at least 16 camps that once bustled with Chinese workers and equipment have been abandoned or shut down completely. In those that remain, row upon row of front-loading bulldozers, steamrollers and forklifts sit unused under the sleepy eyes of Angolan soldiers. And the Chinese? "They're gone," says a scrawny guard at the entrance to Catumbela's paper mill, as he stares disconsolately at the tracks. "I don't know when they're coming back—they ate their dogs and left."

Africa has rarely been kind to the grand visions of others—whether Dr. Livingstone or Bono. The Chinese are finding, to their surprise, that they're no exception. The Lobito railroad has fallen victim to a high-level dispute between the Angolan and Chinese governments. So have dozens of other deals, including another $2 billion contract, to build an oil refinery in Lobito. The American Embassy says that project will now most likely be awarded to Bechtel. "The Chinese thought they'd come in here and make a killing," says a Western diplomat in the capital, Luanda, who was not authorized to speak on the record. "Now they're facing the reality—it's hard to do things here."

Overall, China's push into Africa has been remarkably successful. Chinese companies are sucking up oil from Sudan, cutting down timber in Guinea and mining copper and zinc from the Congo. Beijing recently bought a major stake in South Africa's Standard Bank to fund infrastructure projects throughout the continent. And the Chinese are far outpacing their Western rivals. China has opened more embassies in Africa than the United States has, and is even investing heavily in countries, like Rwanda, where the immediate returns are murky at best. Last year trade between Africa and China topped $50 billion. By 2010 it's projected to reach $100 billion.

But all that money—China has extended $11 billion in loans to Angola, more than the World Bank—doesn't mean the Chinese working in Africa are insulated from the continent's troubles. Kidnappings, killings and death threats have plagued Chinese workers from the Niger Delta to the eastern reaches of Ethiopia, where rebels ambushed and slaughtered 17 Chinese oil workers last year. Angola is now China's biggest supplier of crude oil, and Chinese money helped propel the local economy to a 24 percent growth rate last year. But it's also a chaotic, corrupt country that has only recently emerged from a vicious civil war. For Chinese businessmen and workers, it's turning out to be a sobering, even dangerous place.

Chinese laborers are venturing deep into the lush Angolan countryside, not just the capital and larger cities. Tens of thousands of Chinese-made PMN-2 mines are still buried there, remnants of the Angolan civil war, which killed more than a million people. De-mining crews are digging the explosives out of the ground, but nowhere near fast enough for the Chinese. So the foreigners improvise. "With a front loader we push the dirt and if there's a mine there it explodes," says Zhou Zhenhong, manager of Kaituo Construction and Enterprises. "It's faster that way, and less expensive than being late."

The costs, however, can be more than monetary: on Oct. 24 a Chinese laborer for the Chinese telecom giant Huawei was digging a trench for fiber-optic cable near the southern town of Benguela when a mine exploded, killing him. Two co-workers were also injured. "We've tried to tell them to be careful and they just shrug their shoulders," says Rebecca Thompson, who directs a Norwegian de-mining NGO in Luanda.

Western executives—hidden behind the walls of their villas—have bred a certain kind of resentment in Africa. In Angola the much more numerous and adventurous Chinese are suffering from another. Perhaps as many as 100,000 Chinese workers have spread out across the country, many breaking rock on highways or pouring concrete at construction sites. Most live in isolated camps. Few speak English; fewer still speak Portuguese.

State-owned Chinese companies prohibit any type of fraternization between their employees and Angolans. If a worker becomes romantically or sexually involved with a local, he's quickly hustled back to China. "Africans and Chinese think differently," says Xia Yi Hua, a regional director for China Jiang Su, a massive construction conglomerate with offices across Angola. Xia has been in the country for four years, and his company still sends him shrink-wrapped packets of Chinese food from back home, along with regular sets of chopsticks. Everything in his office comes from China. One coffee table is made of Angolan wood, he admits, but he flew in a Chinese carpenter to fashion the table.

Racist stereotypes are common: both sides accuse the other of looking or behaving like monkeys or pigs. The Angolans claim (without good evidence) that the Chinese eat their dogs. At most work sites Chinese supervisors oversee black laborers, which has created friction. "You Chinese come to Angola and order us around, but in your own country you are suffering," says an Angolan who works for a Chinese company. (He asked not to be named for fear of losing his job.) At one Chinese-run construction site NEWSWEEK visited, hungry workers begged for food, saying their Chinese bosses never fed them. (The bosses say that's not their responsibility.) Angolans laying fiber-optic cable for Huawei near Benguela say they must dig 16 feet a day, or else they won't be paid their $5 daily wage. They claim their Chinese bosses only use one Portuguese word, cavar, which is repeated again and again: dig, dig.

The tensions go all the way to the top of the food chain. The Chinese say Angolan government funding for the Lobito railroad has dried up mysteriously; the Angolans say the Chinese stopped working because of mines along the route. Western diplomats in Luanda, who customarily speak only on condition of anonymity, suspect that the dispute has to do with kickbacks but cannot prove anything. They say that the government's finances are incredibly murky, and its dealings with the Chinese murkier still. "Is it all getting stolen? I don't think so," one Western diplomat says of the billions in oil money flooding into Angola's treasury. "[But] it's not clear to me that there's anyone in the government who can actually tell you where all the money is. If there is, it's going to be somebody like Al Capone's bookkeeper."

Even China's success in Angola is creating headaches for its businessmen. The handful of business hotels in Luanda are booked months in advance. Good luck finding a cab—the city has only one official taxi service—or renting a car, which can go for as much as $12,000 a month. Rents for houses in Lobito are double that. The extremes of poverty and wealth are deep, and worrisome. Where there are roads in Luanda—much of the city remains a hive of rock-strewn dirt tracks—they are choked with bright yellow Hummers and souped-up Chevy Blazers. Chinese-built mansions for Angolan ministers loom grotesquely on Luanda's hillsides, just above shantytowns where millions of refugees took up residence during the worst years of war.

For Mr. Li, a local director for the Guang Xi construction company, the boom is a mixed blessing. Li, who asked that only his last name be used, lives in a cavernous supermarket warehouse in Lobito, with sheets hung on clotheslines to create sleeping areas for his 20 workers. He spends much of his time slogging around the city, begging for the cement his crew needs to build bases for cell- phone towers. On a recent day visiting potential suppliers, he returned long after dark with 12 small bags of cement, all bought at retail prices. "Everything is waiting, waiting," he says, worried about the pace of his project. A Brazilian company has promised to build two new cement factories in Luanda, but so far work hasn't begun.

Beijing takes the long view in Africa, figuring its investments now are building good will for the future. But every economy the Chinese help revive becomes that much more attractive to their rivals, too. Already American firms Bechtel and KBR are bidding for infrastructure projects in Angola. Oil giants ExxonMobil and Chevron are increasing their presence in the country. The Brazilian firm Odebrecht is building a highway to compete with the Chinese railroad to Lobito, South African companies are repairing the electrical grid near the oilfields in northern Angola, and the Portuguese are horning in on construction projects in and around Luanda. "In this country, you can get projects for $10 million and do $1 million in profit," says Zhou Zhenhong, the construction executive, over lunch at a seaside restaurant in Lobito. For that kind of money, a lot of people will be willing to put up with the same hassles as the Chinese.

Comment:
It is no surprise that some projects initiated by China, in Africa, have been abandoned due to disagreement and conflict between the higher authorities. On the community level, under the roof of a work organisation, Africans and Chinese can barely meet each other eye to eye. Building camaraderie among the two races is not encouraged and even frowned upon. Scott Johnson mentioned that Beijing figures that its investments in African now are building good will for the future. I think that the security of this good will can only be ensured when mutual respect is attained between the head of both countries with the forging of strong diplomatic ties. This should also change the dynamics between the ordinary African and Chinese worker. Then, the proceeding of plans will stand a better chance to reach completion.

Posted by: Elizabeth Tan 07S307

The Economists: The New Colonialists

2008-04-06T11:14:00.002+08:00

The Economists: The New Colonialists
Link: http://www.economist.com/opinion/displaystory.cfm?story_id=10853534

THERE is no exaggerating China's hunger for commodities. The country accounts for about a fifth of the world's population, yet it gobbles up more than half of the world's pork, half of its cement, a third of its steel and over a quarter of its aluminium. It is spending 35 times as much on imports of soya beans and crude oil as it did in 1999, and 23 times as much importing copper—indeed, China has swallowed over four-fifths of the increase in the world's copper supply since 2000.
What is more, China is getting ever hungrier. Although consumption of petrol is falling in America, the oil price is setting new records, because demand from China and other developing economies is still on the rise. The International Energy Agency expects China's imports of oil to triple by 2030. Chinese demand for raw materials of all sorts is growing so fast and creating such a bonanza for farmers, miners and oilmen that phrases such as “bull market” or “cyclical expansion” do not seem to do it justice (see special report). Instead, bankers have coined a new word: supercycle.
Not all observers, however, think that China's unstinting appetite for commodities is super. The most common complaint centres on foreign policy. In its drive to secure reliable supplies of raw materials, it is said, China is coddling dictators, despoiling poor countries and undermining Western efforts to spread democracy and prosperity. America and Europe, the shrillest voices say, are “losing” Africa and Latin America.
This argument ignores the benefits that China's commodities binge brings, not only to poor countries, but also to some rich ones, such as Australia. The economies of Africa and Latin America have never grown so fast. That growth, in turn, is likely to lift more people out of poverty than the West's faltering aid schemes. Moreover, China is not the only country to prop up brutish regimes. Witness the French troops scattered around Africa, some of whom recently delivered a shipment of Libyan arms to Chad's embattled strongman, Idriss Déby.
A new nuance
China could—and should—use its influence to curb the nastiest of its friends, including the governments of Sudan and Myanmar. And it is beginning to do so. It has ceased to resist the deployment of United Nations peacekeepers in Darfur, and is even sending some of its own military engineers to join the force. Wen Jiabao, China's prime minister, has called publicly for democracy in Myanmar—which, even though Chinese officials' understanding of democracy is different to Westerners', is a bold step for a government that claims not to meddle in other countries' internal affairs. The more business China does with the rest of the world, the more nuanced its foreign policy is likely to become.
Still, China's hunger for natural resources is creating plenty of problems. Most of them, though, are in China, not abroad.
China is hoovering up ever more commodities not just because its economy is growing so quickly, but also because that growth is concentrated in industries that use lots of resources. Over the past few years, there has been a marked shift from light manufacturing to heavy industry. So for each unit of output, China now consumes more raw materials.
That may sound like a minor change, but the implications are dramatic. For one thing, it has encouraged the sort of foreign entanglements that are now causing China such embarrassment. More worryingly, it is compounding China's already grim pollution. Heavy industry requires huge amounts of power. Steelmaking, for example, uses 16% of China's power, compared with 10% for all the country's households combined. By far the most common fuel for power generation is coal. So more steel mills and chemical plants mean more acid rain and smog, not to mention global warming.
These are not just inconveniences, but also an enormous drag on society. Each year, they make millions sick, cause hundreds of thousands of premature deaths, sap agricultural yields and so on. Pan Yue, a deputy minister at the government's environmental watchdog, believes that the costs inflicted by pollution each year amount to some 10% of GDP.
No fire without smoke
It is no wonder, then, that pollution is the cause of ever more protests and demonstrations. There were some 60,000 in 2006 alone, by the authorities' own count. Some are led not by impotent peasants but by well-organised burghers from Shanghai and Xiamen, a development that must horrify China's rulers. And the potential for even more disruptive environmental crises is great: northern China is already running out of water, and the glaciers that feed its dwindling rivers are melting, thanks to global warming.
The government is aware of these problems, and is trying to address them (see article). It has used this month's People's Congress to raise the status of Mr Pan's agency to a ministry. It has increased fines for pollution, reduced subsidies on fuels and scrapped tax breaks for heavy industry. It is also promoting cleaner sources of power, such as windmills and natural gas. Yet despite frantic efforts to clean up Beijing in time for the Olympics in August, athletes still doubt the air will be fit to breathe. The world's fastest marathon runner, for one, has threatened to drop out of that race because of pollution.
All the government's green schemes are being undermined by an artificial abundance of cheap capital, and by bureaucrats' enthusiasm for channelling it to grubby industries. Chinese banks, with the government's blessing, pay negative real interest on deposits and so can lend to state-owned firms very cheaply. Many of those firms also benefit from free land and pay negligible dividends to the state, leaving lots of money to invest in more dirty factories. Chinese depositors and taxpayers are subsidising the very industries that are slowly poisoning them.
China is bound to consume enormous amounts of raw materials as it develops. But given how polluted the country already is, and how much unrest that pollution is causing, it should curb its hunger for resources. A less wasteful development strategy would be a healthier one.

Comments:

I think that this is a very good article as it summarises the problems that is being felt in China today as China hunger for resources continues to grow. The intense amount of energy that Chinconsumes had led to huge amount of pollution in China which inturn led to demonstrations. The pollution problems had caused millions of people to be sick each year and this will affect the performance of China economy. Also, other than the pollution problems, the Chinese banks are also facing a huge problem. pay negative real interest on deposits and so can lend to state-owned firms very cheaply. Many of those firms also benefit from free land and pay negligible dividends to the state, leaving lots of money to invest in more dirty factories. The Chinese people are saving money in banks that are not making money at all as the have to lend it to firms that are also not making profits. This proves to be a huge problem in China as this could eventually lead to the collapse of the financial institutes in China.

The Economists: Where is everybody?

2008-04-06T10:52:00.003+08:00

The Economists: Where is everybody?
Link: http://www.economist.com/research/articlesbysubject/displaystory.cfm?subjectid=478048&story_id=10853627

Manufacturers struggle in southern China's industrial belt
AT FIRST, the managers of the factories spread throughout Guangdong province thought the lack of returning workers after the Chinese New Year break in early February was merely because they had been delayed by the huge blizzard that disrupted rail and power lines, and left roads impassable. But now that the mess has now been cleaned up, it is clear that the vast annual migration of around 20m people that has fuelled the manufacturing boom in southern China over the past two decades is beginning to diminish.
The Guangdong Labour Ministry reckons 11% of the workers did not return after the holiday; other estimates are as high as 30%. Whatever the precise number, many factories are reeling. Wages were already rising; now they will surely go up further, adding to surging costs for credit, materials, energy, environmental compliance and health care. Meanwhile, revenues are falling due to slowing demand from America and a reduction, following pressure from other countries, in China's complex system of export subsidies.
A survey of conditions in southern China conducted in the aftermath of the Chinese New Year, covering 162 members of the Federation of Hong Kong Industries, produced reams of gloomy figures. Members estimated 10-20% of the 70,000 factories in Guangdong province had closed in the past year, and expected a similar number to close within the next two years. Two-thirds of those polled said they were unsure whether to invest more in the region; one-third planned to cut investment. Only one respondent was optimistic.
To some extent the upheaval in southern China follows a government plan to force dirty, low-paying industries out of business or into poorer interior regions that have so far missed out on the country's growing industrial wealth. The hope is that the gaps in Guangdong will be filled by factories producing more sophisticated, high-value products that are cleaner and less energy-intensive to produce. There are signs that this is indeed happening.
Factories are opening up in China's interior, providing opportunities for those in rural areas to find employment closer to home, rather than having to leave their families for an entire year. This may explain the reduced flow of migrant workers. At the same time, discriminating industrial parks are popping up in Guangdong and Suzhou, among other places, that will only permit factories producing sophisticated electronics and medical equipment. The factories in deepest trouble are said to be in low-cost, low-skill areas: toys, plastics, shoes, clothing and so on. Many are sweatshops with poor working conditions.
Firms that provide relatively high wages and good working conditions do not seem to have problems attracting employees. Nike's sneaker factory in Dongguang, one of the grimier sections of Guangdong, has 27,000 workers, including 4,500 that have returned over the past year and 40% who have been around for at least three years. The workers receive 1,400 yuan a month ($200), well above the minimum wage, receive subsidised food and (for the 7,500 living inside the factory) clean dormitories. Nike is not competing for the low end of the market: shoes produced its is Dongguang factory can cost as much as $185 a pair.
But Nike has been steadily spreading manufacturing from southern China to the rest of the country, and the rest of South-East Asia. Indeed, the idea of shifting away from China seems to be gaining adherents. A study by Booz Allen Hamilton, a consultancy, on behalf of the American Chamber of Commerce in Shanghai, says more than half of foreign firms believe China is losing its edge over other low-cost Asia countries, and 17% intend to relocate.
This shift will be a good thing, as production shifts to Bangladesh, Indonesia, Malaysia and even Africa, spreading wealth and deepening manufacturing skills. Whereas China was once desperate to grow through exports, it is now developing its own domestic economy and has other ways to thrive beyond merely producing cheap goods. But these shifts are at the very least disruptive. Hundreds of thousands, if not millions, of unskilled workers still depend on southern China's low-cost factories for their livelihoods.
And as the rusted hulks of manufacturing plants throughout the Western world attest, the transition to higher-value products can be difficult. Clement Chen, the chairman of the Federation of Hong Kong Industries, says the Chinese government is understandably clamping down on lots of dirty industries—leather tanning, dyeing, finishing, electroplating, and the like—but that this can disrupt the broader manufacturing supply chain, including industries China wants to develop. Business environments, like ecosystems, can be fragile—and once lost, competitive advantage can be hard, if not impossible, to regain.

Comments:
This article provided shocking news about the manufacturing industries in China. Many people believe that the manufacturing industries are doing very well in China and that it will continue to grow. However, this article proves that it may be wrong. The labour ministry estimates that 11% of the workers did not return after the Chinese New Year holidays and that others estimate it to be at 30%. Furthermore, it also state that many of the factories are starting to close down as most of them are starting to shift their operations to other parts of China and increasingly other parts of the world. This shows that China may well be losing their comparative advantage in the manufacturing sector. Mnay factories are relocating their plants to Malaysia, Indonesia and even to Africa. Cost of production in China is strating to increase and many investors are not willing to invest in China. However, this report is only looking from a one sided point of view. China may be losing out to some countries, however, they still remains as the world largest receiver of FDI and that even though factories are rrlocating, there are still tons of factories in China which employs millions of people. Thus we can just conclude from just a few cases that China is strating to lose out to other countries.

TIME: Get Ahead, Learn

2008-04-05T23:28:00.001+08:00

Get Ahead, Learn

By Austin Ramzy

TIME: June 26 2006

It's Friday night in Ikebukuro, a Tokyo entertainment district full of cheap bars and pachinko parlors. As the office workers head to their favorite watering holes, three salarymen split from the crowd and enter a decrepit building that stands between a karaoke lounge and a tavern. Ignoring the sounds of sirens, drunken crooning and breaking glass outside, Hidetoshi Seki, Takashi Kudo and Yuji Yano huddle in a tiny room just big enough for a table for four, and open their Chinese textbooks. For the next 50 minutes the trio, all from a small trading company, practice describing their favorite foods and hobbies in Mandarin. Despite their crumpled shirts and five o'clock shadows, they are having a blast. The young female instructor at B-Chinese Language School indulges them as they crack jokes and make fun of each others' muddled pronunciation. Their language classes are the first lessons that any of them have taken since childhood, says Yano, 39. "We sort of unanimously agreed that Chinese would be a useful skill to acquire."

No kidding. The urge that drives those salarymen to pass up karaoke on a Friday night is increasingly common. In the past, when people set out to improve themselves by learning another language, those that didn't already speak it usually picked English. But while English may be the only truly international language, millions of tongues are wagging over what is rapidly becoming the world's other lingua franca: Mandarin. Seen as a key skill for people hitching their futures to China's economic rise, Mandarin is becoming common currency, particularly in Asia where trade ties with the Middle Kingdom are supplanting those of the region's longtime primary partner, the U.S. Indeed, because English is spoken so universally, it no longer offers companies and employees the edge it once did, according to a recent report by British linguist David Gaddol. If you want to get ahead, learn Mandarin. "In many Asian countries, in Europe and the USA, Mandarin has emerged as the new must-have language," Gaddol notes.

To an extent, this is a case of history repeating itself�with a twist. Just as Americans started studying Japanese in droves in the 1980s, when Japan's economy was ascendant, so today, as China rises, the world is embracing Mandarin. (It doesn't hurt that Chinese is spoken by an estimated one out of every six people on earth.) In South Korea, 160,000 high school and university students are studying the Chinese language, an increase of 66% over the past five years. The number of Japanese secondary schools offering Mandarin more than tripled between 1993 and 2005, and in Japan it's now the most taught foreign language after English. Mandarin is even being pushed within China itself, where hundreds of Chinese dialects can make communication tricky. The central government has promoted standard Mandarin, or putonghua, since the 1950s. Growing internal migration has boosted that effort, and putonghua is now commonly heard on the streets of Shanghai and Guangzhou, cities with their own dialects.

Outside Asia, the ranks of students studying Chinese are small but growing rapidly. From 2000-2004, the number of students in England, Wales and Northern Ireland doing Advanced Level exams (those normally taken at age 18) in Chinese climbed by 57%. In the U.S., Chinese still lags far behind traditional foreign languages like French and Spanish, but China is the fastest growing destination for college students studying abroad. "I thought about what I was going to do after I graduated from college," says Kim Ku Jin, a 26-year-old from Pusan, South Korea. "How am I going to earn money? How am I going to eat?" The answer: buckle down and learn Mandarin. When Kim completed his obligatory two-year military service, he headed to the Chinese capital to pursue a language degree at the Beijing Language and Culture University. "In China I will definitely have opportunities," he says. Claudia Ross, a Chinese-language professor at College of the Holy Cross in Worcester, Massachusetts, says she's hearing the same things from her pupils. "Students who enrolled in Chinese used to tell me their parents would say, 'Why on earth are you studying this?'" says Ross. "Now students regularly come in saying, 'I'm taking Chinese because my parents say I should.'" At Holy Cross, enrollment in first-year Chinese doubled last year. "There are dollar signs attached to it," says Ross.

Mandarin was not always so trendy. It's daunting to learn, especially for Westerners, because of the tones used in speech to shift meaning�to say nothing of the thousands of characters that must be memorized to achieve true literacy. Politics threw up another impediment. During the Cold War, when China was sealed off from the rest of the world, fluency in Chinese was considered, at best, an arcane academic pursuit for diplomats and students of acupuncture or Tang poetry. At worst, it was considered the language of the enemy. Despotic right-wing governments in some Asian countries, fearing their regimes would be toppled by the spread of communism, thought of Chinese-speakers as Maoist revolutionary threats. In Indonesia, Suharto banned Chinese-language publications and closed almost all Mandarin schools. But after then President Abdurrahman Wahid lifted the ban in 1999, six universities added Mandarin courses, as did dozens of smaller language centers.

Now, students who can put "fluent in Mandarin" on their resumes are seeing the payoff. Jakarta resident Imam Fanani, 26, was initially discouraged when he began hunting for work last year because many of his friends had been unable to find good-paying jobs. But a day after he submitted his resume to several employment websites, he had three job offers. His edge? A degree from the University of International Business and Economics in Beijing. "There is no discrimination against the language anymore," says Imam, who now works at a conglomerate owned by an Indonesian Chinese. "In fact, you could even say it's become kind of fashionable."

It's in vogue even in the backwaters of Asia's least developed countries. In 2004, China became Cambodia's biggest foreign investor, and some Cambodians now think Mandarin is as useful as English. The Chea family in Phnom Penh decided to spread its bets: Rotha, a 13-year-old boy, studies English while his 12-year-old sister, Sophea, learns Mandarin. Spending money on language lessons has earned their parents, Chea Song and his wife Sotheary, the ridicule of neighbors, who point out that the Cheas don't have a proper house�they live in their open-air coffee-and-noodle shop. "Some people criticize me, saying I have no home to live in but I send my daughter to learn Chinese," says Chea Song. "But even if I'm poor, I want the best education for my children." English may help his son find a job with one of the many aid agencies working in Cambodia, or allow him to pursue medical studies, Chea reckons. His daughter's Mandarin skills may land her a job in a private business or as a translator. As he sees it, "The whole world is speaking Chinese."

EXPORTING MANDARIN
Eager to assert itself internationally, the Chinese government is itself on a drive to promote Mandarin abroad in hopes of putting it on a par with English. "Promoting the use of Chinese among overseas people has gone beyond purely cultural issues," said Hu Youqing, a National People's Congress deputy and Chinese-language professor at Nanjing University, in an interview with the government-owned China Daily. "It can help build up our national strength and should be taken as a way to develop our country's 'soft power.'"

To that end, over the past two years Beijing has opened language and cultural centers called Confucius Institutes - modeled on Spain's Instituto Cervantes or Germany's Goethe-Institut- in more than 30 countries, including Australia, Japan, Kenya, the U.S. and Sweden. China has also deployed more than 2,000 Peace Corps-like volunteers to teach Mandarin overseas, mostly in Asian nations such as Thailand, the Philippines, Indonesia, Singapore, Malaysia and South Korea. Meanwhile, back home, China has been rapidly upgrading Mandarin-language schools to handle a rising influx of overseas students. In Beijing, for example, Capital Normal University's North Number 1 campus features a pair of new gray steel and glass towers with polished stone floors and an indoor swimming pool. China's vastly ambitious goal is to have 100 million foreigners studying Mandarin by the end of the decade. "China is like an imperial civilization, or the U.S. or Britain or France. It tends to view the world on its own terms," says Nicholas Ostler, the British author of Empires of the Word: A Language History of the World. "In China, people talk in Chinese. More and more, they expect others to speak to them in Chinese, too."

China's efforts to spread Mandarin are managed from the 17th floor of an office building in the northwest corner of Beijing. There, school officials from around the world come to talk with Xu Lin, a voluble woman with an intense gaze who heads the National Office for Teaching Chinese as a Foreign Language. On a hot, smoggy day last fall, she hosted a delegation of American educational and business leaders, including a former assistant secretary of education and school superintendents from New York and California. They sat at attention as Xu outlined her agency's plans for teaching Chinese to the world. To close the meeting, Xu signed an agreement with the commissioner of education in Kentucky to help his state develop a Chinese-language program. Xu and the commissioner, Gene Wilhoit, shook hands and Xu presented him with a gift: a digital wand that reads Chinese characters aloud when dragged across text. Wilhoit tried it out. An uncomfortable silence followed. "I think it's broken," one of Xu's subordinates muttered. Someone fiddled with the gadget, and Wilhoit tried again. There was a pause, and then a mechanical voice droned out one of the phrases that Xu deemed critical to survival in China: "Ganbei!"

Kentucky may have to rely heavily on such technology to teach students to say "cheers" in Chinese. The state has only a handful of Mandarin classes, such as a program that started up in January at a Louisville elementary school, because there aren't enough trained Mandarin teachers. The problem is widespread in the U.S. According to a 2004 survey by the College Board, a nonprofit organization that conducts college placement exams, 2,400 high schools wanted to offer Advanced Placement classes in Chinese, far more than the few hundred schools the organization expected. "The level of interest is high, but the level of expertise is low," says Scott McGinnis, an academic adviser at the Defense Language Institute in Washington. In January, U.S. President George W. Bush announced plans to spend $114 million next year to boost the number of instructors and augment educational programs for "critical need" languages including Arabic, Chinese, Russian, Hindi and Farsi.

For now, Kentucky educators are relying in large part on young Chinese volunteers such as Zhao Jing, a 29-year-old from the northern coastal city of Tianjin. A year ago, Zhao's knowledge of Kentucky was limited to visits to Ken De Ji�the Chinese name for Kentucky Fried Chicken. But after being recruited by the Kentucky Department of Education to develop the state's Mandarin curriculum, she drives hours to rural towns to talk with students and teachers about China. At noon on a recent Monday, Zhao carried her laptop to an audio-visual studio in the state education building in Frankfort, set up a PowerPoint presentation on an octagonal table, and waited for her students. One by one, department employees filed into the room and took seats around the table for the twice-weekly Chinese class. "Ni hao," they said, and then they began a lesson on the Chinese New Year and signs of the zodiac. When Zhao asked department policy advisor Debbie Hendricks, 51, to say her birth animal, Hendricks laughed, "I'm in over my head."

SETTING THE PACE
The rest of the world isn't going to wait for people like this to catch up in the race to learn Chinese. East Asians have a head start, due to the long history of interaction between China and its neighbors. China is now South Korea's biggest trading partner�having surpassed Japan in 2002 and the U.S. in 2004�and its people are signing up for Chinese lessons with zeal. South Koreans are the largest group of foreigners studying in China, representing about 40% of the 110,800 total last year. This trend is boosted by cultural ties, both new and old. Korean music and drama are among the most popular offerings on the mainland today, while 60% of Korean vocabulary comes from Chinese (similarly, written Japanese has several thousand characters borrowed from China). While that language transfer took place over centuries, Chinese now spreads across Asian borders at the speed of an instant message. Woo Jae Hoa, a 22-year-old student in Seoul, practices Mandarin by chatting online with a Chinese girl he met on the Internet. He types phonetically as he has yet to learn many Chinese characters. His new pen pal responds with simple, out-of-a-textbook answers, though they also delve into lighter topics, such as Korean pop music.

But a shared history can also be a curse. The widespread popularity of Chinese-language study in Japan has been hindered by the sensitive relationship between the former enemies. Last year there were 24 students in Mitsuko Yajima's Mandarin courses at Asia University. This year, following anti-Japanese demonstrations in several large Chinese cities, there are just 14. "Japan is slow to nurture a population of Mandarin students," says Yajima, who has taught Mandarin at the university for 30 years. "We are way behind South Korea."

That's not just an academic concern. As China's economic clout grows, the ability to reduce frictions and misunderstandings in business communications offers a strategic advantage. Even enthusiastic promoters of Mandarin aren't predicting that it will ever overtake English as the world's common language. But just as knowing English proved a key to getting ahead in the 20th century, learning Chinese will provide an edge in the 21st. It won't be easy, though. Acquiring the language requires hundreds of hours of study, countless early mornings memorizing characters, or, if you're a salaryman in Tokyo like Hidetoshi Seki and his pals, practicing sentence patterns while everyone else is out having fun. "We deal with a lot of Chinese clients," says Seki, 39. "But we weren't sent here by the company. We're drinking buddies, and decided to do something more constructive with our time than guzzling beer." Getting ahead sometimes requires a little sacrifice.

-Joslyn Chew-

2008-04-05T14:33:00.001+08:00

Sudan's FM lauds China's role in solving Darfur issue
February 25, 2008
Xinhua News

Taken from: http://news.xinhuanet.com/english/2008-02/25/content_7662170.htm

Liu Guijin (L), the Chinese government's special representative for Darfur, shakes hands with Sudanese Foreign Minister Deng Alor in Khartoum, capital of Sudan, on Feb. 24, 2008.(Xinhua Photo)Photo Gallery>>>
KHARTOUM, Feb. 24 (Xinhua) -- Sudanese Foreign Minister Deng Alor Sunday said China is very much welcome in helping the country find a solution to the Darfur issue.
China is not directly involved in the Darfur conflict, but as a partner, "China is using its good relations with Sudan to help it solve the Darfur issue," Alor told reporters after a 40-minute meeting with Liu Guijin, the Chinese government's special representative for Darfur.
"There is a perception in the West that China is helping Sudan, whether directly or indirectly, (do something) against the Darfur region. And I think it is the responsibility of our government and China to change that perception," said the top Sudanese diplomat.
"China is not here to help Sudan in a way that will prompt the Darfur conflict to continue. China is here to help Sudan in issues regarding economic developments. China is here to help build Sudan, and China is engaged in business not only in the oil sector, but also other sectors," Alor said.
Commenting on some Western organizations' threat to boycott the Beijing Olympic Games, Alor said, "What they should do is to solve the Darfur issue in a right direction, instead of putting more pressure on China."
Alor expected the Beijing Olympic Games to be a success despite the pressure on China over Darfur.
Liu Guijin(C), the Chinese government's special representative for Darfur, talks with Rodolphe Adada(L), Joint Special Representative of the United Nations (UN) and African Union (AU) for Darfur, in Khartoum, capital of Sudan on Feb. 24, 2008. (Xinhua Photo)Photo Gallery>>>
The minister also reiterated that Sudan is willing to improve relations with Western countries and work with the international community to find a quick solution to the Darfur conflict.
After talks, Liu told reporters that they had had a good discussion on the Darfur issue and its settlement.
China is ready to further cooperation with Sudan, the United Nations, the African Union, regional countries and all parties concerned to find a long-term and proper solution to the Darfur issue, said the Chinese envoy.
Liu said the peacekeeping task conducted by the hybrid U.N. and African Union (AU) force in Darfur has already achieved some progress, which is largely neglected by the Western media.
The envoy said people in Darfur have suffered too long, urging all parties involved in the conflict to find a quick solution.
Liu Guijin (L), the Chinese government's special representative for Darfur, and Sudanese Foreign Minister Deng Alor attend a press conference in Khartoum, capital of Sudan on Feb. 24, 2008. (Xinhua Photo)Photo Gallery>>>
"We need a quick solution. We need the conflict in Darfur to end sooner," he said.
Liu also held consultations with Foreign Ministry Under-Secretary Mutrif Siddig.
After a trip to Britain, Liu arrived here Sunday for a four-day visit, the fourth since his appointment on May 10, 2007.
The former Chinese ambassador to Zimbabwe and South Africa has been engaged in African affairs for more than 25 years. During his previous missions, Liu shuttled between the United States, Britain, Egypt and other countries concerned to seek support for a solution to the Darfur issue.

Comments by Elaine: After reading this article, I find that is a biased view that favours China. As the report is made by the local Xinhua news agency, it is understandable that they publish such pro-China articles. The article states that China is helping Sudan economically and not prompting the Darfur conflict. While, foreign sources have stated that China has supplied Sudan with weapons and aircraft in a bid to obtain natural resources, namely oil. However, some may also say that reports by the foreign media are similarly biased against China and may be classified as “China-bashing”. Therefore, it is important to question both sides of the story on the Darfur Conflict and their respective motives.

TIME: The Birth and Rebirth of Shenzhen

2008-04-04T23:01:00.005+08:00

THE BIRTH AND REBIRTH OF SHENZHEN

By Michael Schuman
TIME: August 21 2006

The city of Shenzhen, cradle of China's industrial revolution, is usually associated with impoverished migrant workers and cheerless gray factories churning out cheap toys, T shirts and sneakers for the world. While that gritty image represents Shenzhen's past, entrepreneur Pony Ma is a harbinger of its future. The 34-year-old Ma is an Internet tycoon with a fortune of nearly $500 million, thanks to the success of the Shenzhen company he founded in 1998, Tencent, China's largest instant-messaging service with 532 million registered users. The company's home is a tidy, landscaped campus where employees, the best and brightest from universities in Beijing and Shanghai, come to work in blue jeans instead of sewing them together in sweatshops. Some of the software engineers at Ma's R&D center earn $5,000 a month, 50 times a typical Chinese factory salary.

Through the wall-sized windows behind his slick, black desk, Ma overlooks steel-and-glass office towers that house similar companies, including an online-music outfit and a "virtual university" where colleges from around the country have conference centers and research labs. This small enclave of white-collar knowledge workers is a model the rest of Shenzhen must rapidly emulate if it is to continue to prosper, says Ma: "In Shenzhen, we really have to move faster than before, and take the right direction." His vision - and his sense of urgency - is shared by city officials, who have launched an effort to move the local economy to a higher plane. The government is promising tax breaks and land concessions to tech firms, and has said it expects to invest $1.25 billion over the next five years to support high-tech start-ups and research projects. "Shenzhen is at an important strategic turning point," the city government said in a policy statement issued earlier this year. "We must not waste time and opportunities in establishing a new, high-tech development strategy."

Those words may have globe-rattling implications. If Shenzhen can leap from assembling basic products with low-wage, poorly skilled labor to nurturing the innovations of lavishly paid talent, it could blaze a trail for the rest of corporate China, which must increasingly develop its own brands, designs and technology to rival those of America, Japan and Europe. It would not be the first time Shenzhen has led the way. The city, located in southern China's Pearl River Delta, has been at the forefront of China's free-market reforms for 25 years. In 1979, late Chinese leader Deng Xiaoping designated Shenzhen as one of the county's first special economic zones (SEZs), offering privileged terms to foreign companies wanting to invest there.

That experiment was a remarkable success. Eager to tap Shenzhen's low costs - especially for labor - foreign companies rushed into the SEZ, led by factory owners from nearby Hong Kong. The result was a decades-long boom, with Shenzhen's economy expanding at an average rate of 28% a year from 1980 to 2004, according to Hong Kong-based consulting firm Enright, Scott & Associates. Exports from Shenzhen reached $101.5 billion in 2005 - 13% of China's total. Today the city is home to some of China's most important electronics manufacturers, such as telecom-equipment firm Huawei Technologies and mobile-phone maker ZTE. (Electronics products make up about 60% of Shenzhen's industrial output, according to Enright, Scott & Associates.)

The economic miracle has had its limits. Parts of the city are industrial and drab, and in recent years petty street crime has become so bad that some Hong Kong residents no longer shop there for cheap household goods and knock-off designer clothes. But with per capita GDP of almost $7,500, Shenzhen is among the richest cities in China. Today's downtown is a jumble of traffic-clogged streets, luxury hotels, Hugo Boss and Louis Vuitton stores, and foreign eateries like Pizza Hut and Taco Bell. At the Portofino housing complex on the city's outskirts, golf carts carry residents from their lavish condominiums to the development's pricey European restaurant.

Why, then, do city officials feel a pressing need for a new economic vision? Because Shenzhen is discovering that the same forces of globalization that made it successful can also work against it. As the city prospered, wages went up, along with a host of other expenses. According to Chinese government statistics, the average annual salary in Shenzhen has surged by about 40% since 2000 to more than $4,000 last year. That's twice the average wage in other major cities like Chongqing. Higher costs are undercutting the profit margins of labor-intensive industries that have been the backbone of Shenzhen's economy. Greg Gong, CEO of Taiwan-based Further Tech, opened a factory in Shenzhen three years ago to make consumer-electronics gear, but he's already getting squeezed. Gong says his costs are rising by 10% annually, driven mainly by higher wages, and tough competition prevents him from increasing the price of his products. Gong says falling component costs are helping him maintain profit margins, but saving money by relocating his factory to a less expensive part of China is out of the question because he needs to stay close to the component suppliers clustered in Shenzhen. "If I moved to Hunan or Hubei, it would be hard to find the parts we need," he says.

Plenty of factory owners feel less constrained. Garment makers and other low-tech manufacturers are increasingly shifting production from Shenzhen to cheaper locales, often the poor provinces of western China or, on occasion, other Asian countries like Indonesia and Vietnam. When companies moved into Shenzhen, "they never thought they'd have to leave a few years later," says Ruby Zhu, senior China economist for the Hong Kong General Chamber of Commerce.

One reason for Shenzhen's rapidly rising labor costs is a shortage of workers. Millions of poor Chinese who in the past sought work in southern China's factories can now find jobs closer to home, and Shenzhen is becoming less of a migrant-worker magnet. That means there are fewer workers to fill the lowliest jobs, and employers must pay more to attract them. At a large job market in downtown Shenzhen, hundreds of positions are posted on bulletin boards and rows of recruiters wait to collect applications, but the trail of employment seekers is frustratingly short. At one booth, recruiter Zhong Man says entry-level salaries at her Shenzhen-based apparel company have doubled in the past two years to $250 a month, but that hasn't alleviated a chronic staff shortage. "It's a little harder to find average workers these days, because the development of the interior is getting better," she says. The government has tried solving the problem by raising the minimum wage to attract more workers from outside Shenzhen. After a 13% increase last year, the government recently boosted the minimum wage within the city's special economic zone by 17% to more than $100 a month - the highest minimum wage in China.

Add in the rising cost of property, lofty electricity prices, water and power shortages and stricter environmental regulations, and Shenzhen has become one of the most expensive places in the country for factory operations. Adaptation is the order of the day. For example, Hong Kong-based Top Form, the world's largest bra maker, has transferred much of the manufacturing of basic bras from its Shenzhen factory to other facilities such as its plant at Long Nan in Jiangxi province, where labor costs (including benefits) are 60% lower. Top Form's Shenzhen factory is now focused on manufacturing high-fashion bras featuring delicate fabrics and complicated designs, which require more talent to produce, but also fetch higher prices in European boutiques. Last year, Top Form also opened a product-development center in Shenzhen to create its own bras. "Shenzhen is not a place for low-skilled manufacturing any more," says Kevin Wong, Top Form's manager for corporate development. "We're moving up the value chain."

Shenzhen's manufacturers are facing many of the same problems that bedevil South Korea and Taiwan, where makers of low-end products, beset by competition and eroding margins, have in recent years been trying to make the transition to more sophisticated products. Shenzhen is trying to jump-start that transition by removing obstacles facing inventive startups. Six years ago, Xian-Ping Lu left his job as director of research at an R&D center for a pharmaceutical firm in the U.S. and, with other researchers, planned to set up their own company in China. Although they considered cities like Shanghai, Lu and his team chose Shenzhen. "We really felt there was a strong market-driven atmosphere in Shenzhen," compared with other cities in China, he says. It was easy to set up his firm and import the advanced equipment he needed for his labs. He has also received about $2.5 million in government research grants, a chunk of which came from the city. Today, Lu's drug-development firm, Shenzhen Chipscreen Biosciences, employs about 45 people working to develop cancer and diabetes treatments in a university-style building at a research park designated for biotech outfits and other advanced start-ups. "If we built this company somewhere else," says Lu, "I don't think we'd have such good luck."

What's good for Lu is good for Shenzhen?and all of China. As the nation's economy roars ahead, growing 11.3% in the second quarter, more parts of the country will face the same challenges of rising costs, labor shortages and aggressive competition. Chinese employers "cannot forever have cheap labor," says Hong Liang, chief China economist at Goldman Sachs in Hong Kong. "They cannot just count on low-cost manufacturing." Soon the entire Chinese economy may be faced with the painful transition Shenzhen must confront today. Shenzhen is "trying to do what the country needs to do," says Chipscreen's Lu. Perhaps this hard-working, ever-mutating city will provide the answer for China, once again.

-Joslyn Chew-

TIME: The West is Red

2008-04-04T22:35:00.007+08:00

The West Is Red

By Hannah Beech

TIME: August 7-14 2006

His family and friends told him not to go. The roads were terrible. The people were even worse: rude, duplicitous, reeking of mutton. And there was nothing to trade, anyway, in that forlorn and forgotten stretch of land, where camel-humped mountains met endless sand dunes. Wasn't Xinjiang, in western China, merely the remote testing ground for the nation's nuclear weapons? But Huang Yinrong was determined. He hailed from eastern Zhejiang province, where Marco Polo had once marveled at the overflowing markets. Commerce was in Huang's blood. So in 1996 he boarded a rusting plane for Xinjiang's capital, Ur�mqi. A friend had told him that foreign steel was selling for cheap, and given that Xinjiang happened to border eight countries?Russia, Mongolia, Kazakhstan, Kyrgyzstan, Tajikistan, Afghanistan, Pakistan and India?Huang thought the place had potential for an import-export business. "At the time, everyone was reinventing themselves in China," recalls Huang. "I figured I had an advantage because I was going to find a new career in a place others didn't go."

A millennium ago, it would have been unimaginable for an ambitious merchant not to be drawn to Xinjiang. The territory was, after all, the nexus of the ancient Silk Road, where the bazaars thronged with Nestorians, Sogdians, Arabs, Manicheans, Levantines, Koreans, Malays, even the odd Venetian. But when feuding tribes made overland travel perilous, and sea lanes to Cathay evolved into a safe alternative, the sturdy filaments of the Silk Road frayed. By the 13th century, Venice's wandering son was among the last waves of travelers on the venerable trade route.

In the 700 years since, empires - Mongol, Manchu, Soviet - have come and gone, and capitalism for a time even succumbed to the torpor of communism. But now a new caravan class is again navigating the Silk Road, and Huang Yinrong is among its vanguard. The year after he landed in Urumqi, he journeyed across the mountain pass to neighboring Kazakhstan, where a steel factory lay in the country's high steppes. For most of the train trip, he sat nervously hugging a briefcase filled with cash, as drunk Russians caroused around him. The only Russian he could remember from school - back when the language was still taught in a China yoked by ideology to the Soviet Union - was do svidaniya (goodbye); Huang prayed he wouldn't have to say do svidaniya to his money. At his destination, a snowstorm was raging. Huang had no hat, and his hair froze. But the bosses at the Kazakh plant, which is now owned by Mittal Steel, were impressed by this intrepid visitor clad only in a thin leather jacket. Though barely any trade trickled through the two nations because of lingering tensions from the Sino-Soviet split years before, they agreed to Huang's unorthodox plan to export steel to China.

Today, most of Kazakhstan's processed iron ore is sent directly to its eastern neighbor. Huang had helped inaugurate a key spoke of the new Silk Road - and this time it was reinforced by steel.

China's global emergence ranks as the greatest renaissance of our times. But, too often, we tell this redemptive tale only from its eastern fringes, ignoring the vast expanse of western China that laps up against Central and South Asia, and beckons toward the Middle East and Europe. Our language of commerce is English, and our attention rests on the "Made in China" containers shipped with mounting urgency from the country's coast. Yet it is in China's backyard, that immense Eurasian landmass, that a 21st century version of the Great Game is being played out. Unlike the last round, when a weakened Middle Kingdom could only watch as Russia and Britain battled for geopolitical dominance, this time China is leading the charge. "All these new paths lead to Xinjiang," says Jumagul Ashake, an ethnic Kyrgyz Chinese who, though the granddaughter of shepherds, works for a trading firm in the province's historic second city, Kashgar. "The new Silk Road is open for business," says the 24-year-old, cell phone and gold-rimmed sunglasses in hand. "And I want to be a part of it."

Beijing is using the reborn Silk Road to trade, to satisfy its seemingly unquenchable appetite for natural resources, and to forge alliances with its western neighbors. Already, China has joined with Russia, India, Iran, Pakistan, Mongolia and most of the former Soviet Central Asian republics in a regional alliance of member states and observer nations called the Shanghai Cooperation Organization (SCO). While hardly as prominent as the European Union, the SCO far outstrips the E.U. in terms of population and wealth of natural resources. In July, Asia's two giants, China and India, formally opened their border after more than 40 years of barbed-wire animosity. And in Pakistan, energy-starved China has helped finance the construction of the Gwadar deep-sea port on the Arabian Sea. Not only will Gwadar facilitate faster passage of Chinese goods to Europe, but the port will also bring Persian Gulf oil to China more quickly through Xinjiang. The roads and railways that will connect Gwadar to Kashgar are also being underwritten by the Chinese. So was the $700 million oil pipeline from Kazakhstan to Xinjiang, which started commercial operations last month and marks the first time foreign oil has flowed directly into China.

Given China's enormous need for energy, Huang Yinrong has diversified his Silk Road business to include black gold as well as steel. The 55-year-old entrepreneur's various foreign ventures have made him a billionaire. Xinjiang has gotten richer too. When Huang arrived a decade ago, the territory was a backwater. Today, the capital, Ur�mqi, bristles with a pincushion of new high-rises and construction sites. Dusty streets where donkeys once roamed are now lined with BMW showrooms and strobe-lit nightclubs filled with Russian-speaking bar girls. Around town, billboards in Cyrillic and Arabic, the region's lingua francas of commerce, offer traders from Central Asia and beyond the best deals in long-distance trucks and air-freight shipping. Trade volume in this far-west boomtown jumped six times between 2002 and 2005. In Xinjiang as a whole, foreign trade in January-April 2006 increased 42% year-on-year, to $2.65 billion, the fastest growth rate among all of China's provinces.

Xinjiang may be far from everywhere, but it is as close to Europe as it is to Beijing. In this spirit of cross-pollination, Huang plans to register a company in the United Arab Emirates later this year. And even though he only finished primary school, Huang sent his daughter to university in London. But the entrepreneur who made his fortune in Xinjiang isn't too impressed by the British capital. "London isn't very developed compared to Ur�mqi," he says. "Here, there are so many new buildings being built, but in London most things are old." Marco Polo, too, must have distrusted the easy comfort of the past. For him, as with Huang, adventure and riches came from savoring the new, the unknown, the path less explored.

AN EXPLOSION OF HAN
Few towns are more bleak than Alataw, a mountainous settlement on the border of western Xinjiang and eastern Kazakhstan. The outpost's few trees permanently hunch southward from the Siberian winds that whip past. Even at twilight, when other Chinese towns are usually filled with gossiping, snacking pedestrians, almost no one ventures out onto Alataw's streets?there's nothing to see or enjoy here. Yet Alataw is home to some 10,000 people, living mostly in a desultory scattering of low concrete blocks, and, by the end of this year, it will likely become the largest land port in China. As the only place in Xinjiang linked by railway to Central Asia, Alataw is positioned as a crossroads between East and West, the linchpin of what the Chinese have dubbed the Eurasian Continental Bridge, beginning in eastern China's Lianyungang city and extending for 10,900 km to Rotterdam. Shipping goods to Europe via road or railway, as opposed to by ocean, cuts the journey from 45 days to just 25. "[Alataw] looks like the middle of nowhere," says Li Zhong, an Urumqi entrepreneur who visits once a month. "But you have to go through here to get anywhere."

Kazakhs, Mongolians and Uighurs?a Muslim Turkic group that prospered in the old Silk Road's heyday - dominate the sere hills nearby. But Alataw is a town of outsiders. The settlement's boom, like those in other parts of Xinjiang, has been powered by a mass migration by China's ethnic majority, the Han. When the victorious People's Liberation Army marched to the far west in 1949, there were few Han living in Xinjiang. Five years earlier, the region's majority Uighurs, with the sanction of other minority populations, had declared the region to be the independent nation of East Turkestan. (A previous effort at sovereignty in 1933 had failed.) National currency was even printed. China, however, considered Xinjiang?Mandarin for "new dominion"?an inalienable part of the country, like Tibet to the south. To help populate Xinjiang with citizens who believed the province was inseparably Chinese, Han settlers were encouraged to migrate westward. The campaign worked: in 1949, 6% of Xinjiang was Han; today, if unregistered migrant workers and long-term soldiers stationed in Xinjiang are also counted, the Han outnumber the once majority Uighurs.

Many Han came through the Production and Construction Corps, a quasi-military force that began massive irrigation and city-building projects in the 1950s. Some of the Corps' recruits were demobilized soldiers, others were forcibly relocated as punishment for their capitalist pedigrees. Like the armies of farmers spurred by the U.S.'s Homestead Act to take Native American land, the foot soldiers of the Production and Construction Corps helped make the majority Uighurs a minority in their own home. Problems for the Uighurs didn't stop there. Worried that Islam would rival communism as a guiding ideology in people's lives, the Party cracked down on religious activity. Indeed, separatist Uighurs linked by the central government to a series of bombings in Xinjiang and Beijing in the 1990s have used Islam as one of their rallying cries. Even today, official regulations prohibit children and university students from praying or fasting. Uighurs who work for state companies are forbidden from wearing veils or sporting facial hair. Although thousands of mosques dot the Xinjiang landscape, few Uighurs seem willing to express fervent religiosity. "If we say we are religious, then the Han people think we are lazy and want to avoid work by praying all the time," says Turuson, a Kashgar taxi driver. By contrast, Han immigrants to Xinjiang openly display Buddhist or Taoist icons in their offices and restaurants.

Even today, the Corps employs more than 2 million Han, and the road from Alataw to Ur�mqi, 10 hours east by car, is lined with settlements with unwieldy names like Corps Division No. 82 Ranch. Such subsidized farming ventures have helped turn Xinjiang into one of China's biggest fruit producers, but the Uighurs were rarely given financial incentives to irrigate their small scraps of farmland. Nor can the Uighurs lay much claim over Urumqi, Xinjiang's booming metropolis, which is 80% Han. Designated the provincial capital by the communists, Ur�mqi entered the record books as the city furthest from the sea in the world. Trade on the new Silk Road has eliminated that sense of isolation. The international airport teems with merchants from Asia and Europe. Hotel-lobby clocks are set to times in Baku, Dubai and Frankfurt. At the giant free-trade zone in downtown Urumqi, Central Asian and Russian traders haggle with almost exclusively Han vendors over stilettos and stereos and Barbie dolls. A Kazakh customer named Alyona Andronova compares her ex-Soviet homeland to China: "In Urumqi, it's still supposed to be communist, but all everyone talks about is money, money, money."

Urumqi, and Xinjiang as a whole, have profited greatly from a Beijing-run program called Develop the West. Kick-started in 2000, the campaign has sought to level income disparity between industrialized Eastern China and the backward interior. With subsidies for megaprojects like a road through the Taklamakan Desert, Develop the West has done just that for many parts of Xinjiang. The infrastructure seed money has attracted foreign traders and investors, who in turn are catered to by more Han migrants. The circle of prosperity, though, has left out the majority of Uighurs. In Ur�mqi, these dispossessed locals walk around, prayer caps and veils on their heads, like colorful extras on a Han movie set. Want to buy a kebab, they call out, or dried apricots? The expensive commodities in the air-conditioned stores are mostly the province of the Han. This may be the capital of what was once East Turkestan, but the Uighurs are outsiders in their own homeland.

A NEW FAITH
In many Muslim towns, the tallest structure is the mosque's minaret. In the ancient oasis of Kashgar, it is a 24-m statue of Chairman Mao Zedong on a platform. The symbolism is no mistake. Kashgar, unlike Urumqi, is around 80% Uighur. In a country with more Muslims than Malaysia, the city remains a religious center to which the faithful gravitate far more than to Ur�mqi, where some mosques have dispensed with five-times-a-day prayers to make way for groups of Han tourists. In Kashgar, an officially atheist overlord?and that's what the Chinese Communist Party is - proves a particularly tough fit.

In its two millennia of existence, Kashgar, near the borders with Kyrgyzstan, Afghanistan, Tajikistan and Pakistan, has been ruled by practically every tribe that wandered through town: Tibetans, Xiongniu, Huns, Mongols, Han, western Turks. All were drawn by Kashgar's fabled bazaar, which even today brings merchants selling everything from pomegranate-emblazoned carpets and electronic equipment to the sturdiest of donkeys (when beast shopping, always check the teeth first). By the mid-19th century, the oasis had turned into a listening post for the Great Game, and the fancy consulates built by the competing Russians and British are still the most elegant buildings in town. In 1933, Kashgar briefly became the capital of the first of two separate attempts at an independent East Turkestan. The city's strategic position between the soaring Pamir Mountains and vast Taklamakan Desert gave the local Uighurs a sense of security?and autonomy?that the communists dispelled when they arrived in 1949. "It is a unique spectacle of Kashgar," reads the plaque accompanying the Chairman's likeness in People's Square, "that shows the deep feelings toward Chairman Mao held by Kashgar's people." After the Red Army's success in the Chinese civil war, Islam was to give way to a new religion in Xinjiang: the cult of communism.

For decades after Mao's statue went up, it towered over a medieval warren of mud-brick houses and trellised courtyards. Flocks of pigeons would circle the Chairman, then swoop past carved wooden balconies and smoke rising from ovens baking flat discs of Uighur bread. The call of the muezzin mixed with sing-song entreaties from the sherbet seller and traveling barber. Kashgar then didn't look so different from the days in the 13th century when Marco Polo rested here before tackling the Taklamakan. But starting in the 1980s, white tile-clad buildings began sprouting near People's Square, their ghostly hulks an otherworldly presence in this dun-colored city. Today, the balance has shifted. The remaining clumps of earthen houses are what look out of place amid Kashgar's concrete-and-tile sprawl. Two years ago, part of the famous open-air Sunday bazaar was converted into a massive metal-roofed warehouse. Inside the fluorescent-lit bazaar, the crowds of Kyrgyz horsemen, Tajik shepherds and burqa-enveloped Uighur matrons look vaguely constricted, their whispered comments on the array of goods echoing through the cavernous space. It is only when the shoppers pour out of the new market and descend on the nearby maze of outdoor stalls that their bodies seem to recover the confidence to shove and bargain and shop as they have for centuries. Saifullah Baig, a Pakistani soldier-turned-trader, first came to Kashgar a decade ago. "There was nothing here then, just mud houses and donkeys," he recalls, as he walks past blue glass-plated edifices that could be in Beijing or Chicago, save for the smell of lamb and cumin in the air. "I can't believe it's the same place."

Much of Kashgar's transformation comes not from the toil of its Uighur majority but, as elsewhere in Xinjiang, through the exertions of the Han. At the construction site for Dingxiang Garden, soon to be Kashgar's most luxurious apartments, 130 workers from the central Chinese province of Sichuan have labored 12-hour days to complete the complex on time. Like almost all major real estate projects in Kashgar, this development is owned by a Han company. Xian Guang, a sinewy 40-year-old, pauses in the middle of painting a stairwell to explain why no Uighurs work alongside him. "Construction work is very hard," he says. "The local people can't handle that."

The thrum of jackhammers has drawn traders from all over South and Central Asia, as well as the rest of China. The largest foreign population hails from nearby Pakistan, and with road access to the Arabian Sea via Gwadar nearing completion, businessmen like Sajjad Ali are dreaming big dreams. "It's a good time to be here," he says, as he sips milky tea at Kashgar's Pakistani Caf�, where homesick South Asians come for comfort food. "I am encouraging more and more Pakistanis to come and take advantage of the trade." Already, Pakistanis can return home and sell Chinese goods for double what they paid in Xinjiang. Now, with Gwadar opening up, they will be able to shepherd Chinese goods on to the Middle East and Europe. "China is growing into a powerful dragon," says Ali, "but the rest of Asia can go along for the ride."

On the dusty outskirts of Kashgar, past mule-drawn carts and shepherds driving straggly flocks of goats, stands a reminder that the dragon has arrived in Kashgar, too. In December, Hisense, one of China's largest TV makers, opened a manufacturing base here. The company aims to churn out 300,000 TVs a year, all destined for Central Asia. Hisense's factory is helmed by Wang Jiangming, who, like many locally born Han, has benefited from Kashgar's commercial boom. In contrast, the majority of Uighurs were never schooled in Mandarin, so they can't get work at the Han companies flooding into Xinjiang. On this day, Hisense's assembly line is manned by Han workers like Cao Wei, a 19-year-old who grew up in Xinjiang and sees a future far beyond the assembly line. "When I was a boy," he says, "I thought I would have to leave to become successful, but now I realize that Kashgar is the right place to be."

Plenty of Uighurs profess to feel the same way. "When I was 30 years old, we never had enough food for the next day," says Noorun, a 74-year-old seamstress whose entire dowry consisted of a pair of shoes and a piece of cloth. "Now, I have plenty to eat. I thank the Communist Party for that." Gratitude to the communists is something that many Uighurs are quick to point out publicly. Attempts to ask about inequity in pay between locals and Han often bring conversations to a halt. So do questions about Rebiya Kadeer, once one of Xinjiang's richest Uighur entrepreneurs until she was jailed for nearly six years after trying to brief visiting U.S. congressional staffers on Han discrimination against her ethnic brethren. (Kadeer is now in exile in the U.S., where she campaigns against continuing repression of Uighur religious and cultural freedoms.) Abruptly changing the subject from local whispers?later reported by international human-rights groups?that at least one of Kadeer's children had been beaten up by police that week, Abdulkarim, a carpet-store manager, loudly describes how he and other Uighurs flooded Kashgar's People's Square in 1976 to mourn the death of Chairman Mao. "It was the saddest day of my life," he says. "We cried and cried." Yet Abdulkarim, it turns out, is only 23 years old and wasn't born until seven years after Mao died. "We were taught," he says quietly, "that we were supposed to be very sad."

The Uighurs are now being instructed that they should be very happy. Kashgar, their most beloved of cities, is again a key axis of global trade. Even though few Uighurs can speak Mandarin fluently, their Turkic roots mean they can communicate with a broad arc of traders all the way from Kazakhstan and Uzbekistan to Azerbaijan and Turkey. "Kashgar is an ancient city with a great civilization, but for so long no one knew that," says Uighur businessman Ahemaja Kaxija. "Now people from all over recognize us, and I am proud of that."

Certainly, Uighurs like Obuli Ishmael, whose family has maintained a pharmacy in the Sunday bazaar for three generations, are profiting from the world's attention. Among the products cramming Ishmael's shop are Iranian saffron, Pakistani lotions, Korean ginseng, Indian balms and Indonesian spices. "Business is much better now because there are so many foreigners coming through Kashgar," he says in Mandarin, grinning after selling a particularly expensive batch of Tibetan herbs to Han customers. For many Xinjiang natives - poor, uneducated, marginalized- the influx of Han and foreign traders only underlines the opportunities they do not have. But for Ishmael and a whole new band of merchants, the Silk Road is once again the path to prosperity.

-Joslyn Chew-

2008-04-04T01:25:00.001+08:00

ON THE PRODUCTION LINE

Nov 23, 2007, BBC NEWS, by Quentin Sommerville

Many of the products UK shoppers buy are made in China. How do workers there feel about efforts to curb consumerism - and the market for their goods?

Wang Guohong is busy threading a knitting machine at the Three Gun Underwear factory on the outskirts of Shanghai. The lime green cotton being wound through the needles will eventually become polo shirts.

Just before the shirts leave the factory, a "Made in China" label is sewn inside, and on the front, a small crocodile logo is added. It's a brand familiar the world over, and the shirts will be heading for stores in the UK, France and Russia.

On Huai Hai St in downtown Shanghai, the shirts she is making sell for more than $100. But Wang Guohong would have to work for more than a week to buy one, as she earns just over $8 a day.

"It's a good job," she says. "If I wasn't doing this I'd be working in a bakers in my hometown, but the money there is not so good." She comes from Anhui province, west of Shanghai. It is one of the poorest places in China; far from the riches of the country's financial capital.

That Western consumers might stop buying her products is a puzzling thought. "If they did, then we would just make for the domestic market." It is unlikely that the designer shirts she produces would find enough customers in China. The country's middle class is still relatively small, but Wang Guohong has a point.

Elsewhere in the factory, machines are making underwear for the Chinese market, including thermal underwear for the People's Liberation Army.

"The margins are better than with our foreign customers," says one manager.

Cheaper goods

China is in large part responsible for falling prices for everything everything from T-shirts to DVD players in shops around the world. It is roughly 40% cheaper to make goods here. Western companies have moved production here to take advantage of low wages and the plentiful supply of workers.

But that's not the only reason companies move to China. Bangladesh and Vietnam have lower wages, but they don't have the modern roads, airports and ports that allow China to deliver goods worldwide in the fastest time possible.

And the world, it seems, is reluctant to turn its back on China.

At the Yuan Tai toy factory, in Donguan in southern China, 20-year-old Wu Jinlian is busy painting tiny black eyes small farmyard animals. Over lunch she explains that she comes from Hunan province - the promise of better wages brought her south.

"If I didn't work here, I'd have to work on a farm at home." The wages would be a fraction of what she earns. Here in the factory, her food and board is paid for - much of her monthly wage of about $80 is sent back to support her family.

She is also responsible for checking the quality of the toys. Despite a series of safety scandals involving everything from Chinese-made toys to car tyres, Western consumers have not been discouraged from buying the goods.

But what kind of impact would there be if the West stopped buying so much from China? Would Wang Guohong have to return to Anhui, and Wu Jinlian to Hunan?

Perhaps not, says Shanghai-based economist, Andy Rothman of CLSA markets. While exports make up about a third of China's economy, most are heavily processed goods that are being assembled and snapped together in China.

Spending power

China makes most of the world's laptop computers, but according to Bo Xilai, the country's commerce minister, it only makes about $15 from each $700 computer.

Stripping out those imported parts, the net export figure only made up 7% of the value of China's economy last year.

"Exports are important, but not nearly as important to China's growth as domestic demand and domestic investment," he says.

And China's domestic demand still has a long way to go. An estimated 400 million people have been lifted out of poverty by 20 years of economic growth, according to the World Bank. As they get richer, Chinese people have more money to spend on consumer goods.

Some 15 years ago there were barely a million cars in all of China. Now everyone wants one, and there are 33 million on the road. In 15 years time, China is expected to overtake the United States with 140 million cars tearing across its ever expanding highway network.

For now, Western consumers are important to China, but that will not always be the case. And while Westerners may eventually be convinced to slow their spending, China and its 1.3 billion customers have only just got started.

Posted by: Shimin

2008-04-04T00:17:00.001+08:00

THIS LAND IS MY LAND

Feb 14, 2008, The Economist

Peasants for privatisation

“LAND to the tiller” has been a slogan of Chinese revolutionaries since Sun Yat-sen used it in 1924. Mao Zedong came to power in 1949 with just such a promise. Now some of China's peasants want his party to make good on the pledge. Late last year groups in different parts of China began simply claiming land as their own individual private plots.

China's constitution decrees that rural land is owned by “collectives”. But it does not make clear who represents these collectives. This vagueness has been one of the biggest causes of rural unrest in recent years. Rural officials, eager to make money for themselves as well as their localities, often appropriate land from farmers to sell to developers. They say they are acting on behalf of the collective. The farmers disagree. If they receive any compensation at all, it is only a fraction of the market value.

In recent years a few Chinese scholars have suggested that privatising rural land would make such land grabs far harder. Their views have been dismissed by Communist Party officials, for whom the collective ownership of rural land is one of the very few core ideological principles left standing in the rush to embrace capitalism.

Of the handful of incidents that have come to light where peasants have taken matters—and land—into their own hands, the first was in the province of Heilongjiang. A statement circulated on the internet in December by leaders claiming to represent 40,000 peasants in 72 villages in Jiamusi prefecture called on village representatives “to pledge to fight to the death” to protect land from seizure by corrupt officials. It said the current system of collective ownership had turned peasants into serfs. Peasants, it said, should have the right to negotiate their own price for land appropriated from them.

Isolated groups of peasants elsewhere followed suit, including some in Shaanxi, Jiangsu, Sichuan and Tianjin. Villagers have likened themselves to the group of peasants in 1978 in a village in central Anhui, who broke up the land into plots farmed by individual households. At the time, they seemed to be taking a big risk. But the party itself soon decided that the Mao-era communal farms had failed and households should be allocated plots of land. The Anhui villagers became famous and the new “household-responsibility system” pushed up yields and incomes. Land ownership remained unchanged.

The flurry of land-rights declarations was soon suppressed. Human-rights groups report that two peasant leaders in Heilongjiang were sentenced in January to labour camp. At least two leaders in Shaanxi have also been detained. Chen Yongmiao, a Beijing lawyer following these developments, says other villagers are preparing to issue similar declarations, but have been slowed down by the recent lunar new year celebrations.

The central government has given a frosty response to the idea of privatising rural land. On January 30th a senior party official, Chen Xiwen, said he saw no prospect of such a move. But some state-controlled newspapers have given unusual prominence to the issue. In January Southern Metropolis Weekly published a lengthy account of the incident in Heilongjiang. It mentioned that peasants did briefly enjoy private land-ownership rights after Mao took over. Other newspapers have published academics' appeals for new thinking on land ownership.
The party may have hoped that such debate would be put to rest by the passage last March of China's first law on property rights. This allows the renewal on expiry of the 30-year land-use leases most peasants were granted when plots were divided among households. Officials said the process would be automatic, with renewals granted indefinitely. But peasants still cannot sell or mortgage their plots.

The government worries that the country's food security will be jeopardised by the loss of farming land. So it is alarmed that peasants living close to cities have increasingly been behaving as if the land is theirs anyway. Urban demand for housing has pushed prices up rapidly in recent years. Farmers have been taking advantage of this by selling land, or even their own homes, to developers without proper authorisation. Urban residents have been keen to buy these village properties because they are considerably cheaper than legitimate ones in the cities.

In January the central government issued a directive reminding city-dwellers that they were banned from buying village properties. But enforcement is likely to be half-hearted at best. Chinese press reports have suggested that as many as one out of five homes purchased in Beijing are on rural land unauthorised for such use. Evicting their occupants would anger the middle classes. Their wrath frightens the party far more than the tillers'.

Posted by: Shimin

2008-04-03T23:38:00.002+08:00

NEWSCORP'S MURDOCH PREDICTS LOOSENING OF CHINA MEDIA GRIP

April 3, 2008, THE STRAITS TIME

WASHINGTON - PRESS baron Rupert Murdoch predicted on Wednesday that despite Beijing's tight controls, the media market will open up in China 'in ensuing regimes' and provide major opportunities for global investors.

The billionaire also stressed that there is 'no magic bullet' to the ongoing troubles of traditional media, and that news outfits must diversify geographically and technically in order to stay afloat.

'Things change from time to time and I believe that things are going to change and open up in China, just by the force of things,' Mr Murdoch, speaking at Georgetown University's McDonough School of Business, said of the largest potential media market in the world.

'I think you will find in ensuing regimes ... it's going to gradually open up and be a lot freer,' with 'opportunities arising in China over the next 20 years for worldwide companies, whether they be European or American or whatever.'

The Australia-born, US-based chief executive of News Corp has invested in China for years.
He snapped up Hong Kong's Star TV in 1993 and turned it into one of Asia's largest satellite services, although he has faced charges of kowtowing to Beijing for dropping BBC news from the service.

'I've had that hang around my neck forever,' Mr Murdoch said in his speech to hundreds of university students.

News Corp is also part owner in Hong Kong's Phoenix Satellite Television as well as a local Cantonese channel, and his company, which bought the social networking website myspace.com in 2005, is now a key investor in MySpace China.

Murdoch admitted that his Chinese operation 'walks a very fine line' in terms of politically sensitive coverage in the communist-run state.

'It covers elections in Taiwan when (state broadcaster) CCTV does not. But on the other hand it doesn't have too much about what's going on in the central committee,' he said.

His China investments began back when Jiang Zemin was president and allowed 'little cracks' in foreign investment restrictions in the country's tightly controlled media.

'When he retired, the door was shut on everything, and has been kept firmly shut,' Mr Murdoch said, adding that US Internet firms Google and Yahoo were forced to contend with strict rules of operations by Beijing if they wanted access to the market.

In 2006 Google and Yahoo were among four US firms slammed for bowing to Beijing's demands that the Internet in China be censored to prevent Chinese citizens from seeing websites the government objected to.

'Part of it is just plain nationalism, and part of it ... was considered justified censorship in trying to control a population that size,' Mr Murdoch said.

ut he is banking on China's swelling middle class to make its presence felt.

'There is a real wealthy middle class appearing, and those people ... are going to start to want to have a little more say in their country.'

Mr Murdoch acknowledged that he is sometimes labelled a monopolistic 'antichrist,' but he faced down the issue in a question and answer session.

'Is all media in one hand bad for democracy? Absolutely,' he said. 'But it's not (happening) as people thought.

'We are a tiny fraction of the media landscape. There are millions of voices out there, and we certainly don't have any of that sort of monopolistic view.'

He said that his products are broadcast in 30 languages and reach three quarters of the world's population.

Mr Murdoch warned that traditional media outlets need to shed outdated technology in order to survive.
'Technology is going to continue to destroy all the old ways and old assumptions of doing business, most especially in the media,' he said.

'There is no magic bullet, no one-size-fits-all solution,' he said. 'To stay ahead of the competition, a media company needs to diversify geographically so it can reach more people.' -- AFP

Posted by: Shimin

2008-04-03T22:58:00.003+08:00

DON'T DRINK THE WATER AND DON'T BREATHE THE AIR

Jan 24, 2008, The Economist

And don't expect the government's environmental watchdog to do much about it

THESE days China's environmental bureaucrats know how to talk the talk. They readily admit that pollution is poisoning the country's water resources, air and soil. They acknowledge that carbon emissions are soaring. If only, they lament, the government would give them the means to do something about it.

For all its green promises in recent years, the Communist Party has done little to build a bureaucracy with the clout to enforce environmental edicts and monitor pollution effectively. As long as they deliver economic growth without too much public protest, officials can still expect promotion, however polluted their areas.

Optimists see changes afoot. The State Environmental Protection Administration (SEPA), the government's largely toothless watchdog, could soon be renamed and upgraded to a ministry. Some observers expect the rubber-stamp legislature, the National People's Congress, to endorse the change at its annual session in March.

In an article last year two scholars argued that if SEPA were a ministry it might hold its own better in bureaucratic turf wars in which it is at present “marginalised”. SEPA's weakness was evident last year during one of the country's biggest recent environmental disasters, the choking of the country's third-largest freshwater lake, Taihu, by toxic algae. The contaminants included emissions from small factories and crab farms along the shore. SEPA officials say they could do little: the crab farms fall under the Ministry of Agriculture, waste-water treatment plants under local governments and the lake itself under the Ministry of Water Resources.

SEPA is so weak that its officials admit it has little grasp of the impact of agriculture on water and soil pollution. The Ministry of Agriculture has discouraged it from gathering data even though, as one SEPA official sees it, Chinese agriculture pollutes as much as its industries. The country's first national census of pollution sources is due to begin in February. The ministry is taking part in the two-month effort. But, famously secretive and protective of its bureaucratic territory, it is likely to drag its feet. Health officials would sympathise with SEPA. Their efforts to persuade the agriculture ministry to co-operate over livestock-related threats to public health, such as bird flu, have encountered stubborn resistance. And health already has a full-fledged ministry.

To impress its bureaucratic rivals, SEPA also needs a bigger budget. Officials have said that between 2006 and 2010 China will spend 1.3 trillion yuan ($180 billion) on environmental protection, an increase of more than 85% over the previous five years. But much of this is expected to be given to other agencies (the State Forestry Administration, for example, deals with stemming the spread of deserts) or to the local environmental-protection bureaus, which, being answerable to local governments, are crippled by conflicts of interest.

Little of the money, complains a SEPA official, is used to curb pollution. SEPA itself is so strapped that to finance one of its recent high-profile projects, an effort to calculate a measure of “green GDP” (GDP minus the cost of environmental damage), it begged for money from companies. The government, says an official, gave nothing. After three years of effort, including struggles with a highly sceptical National Bureau of Statistics (NBS), the project was abandoned last year. It did publish one figure: environmental damage in 2004 cost 3.05% of that year's GDP. Last July the head of the NBS said the government had stopped using the term “green GDP” because it was not internationally accepted.

A shortage of money has similarly hobbled SEPA's latest efforts to encourage greener corporate behaviour. These include last year's “green credit” policy whereby state-owned banks are supposed to suspend lending to egregious polluters (SEPA circulated a list of 30 such companies in July). There is also a “green trade ” initiative, announced last October, that threatens polluting companies with suspension of their exports. Also being considered are environmental requirements for companies planning to list their shares publicly, and a tax on polluters. Resistance from local governments and powerful state-owned companies will make it hard to implement such measures.

What it lacks in resources SEPA tries valiantly to regain by appealing to public sentiment. Its deputy director, Pan Yue, is an outspoken green campaigner who happens to be a son-in-law of a famous former general, Liu Huaqing (such connections can be a big help in Chinese politics).

Last year officials reportedly asked the World Bank to remove estimates of pollution-related deaths in China from a report published jointly with SEPA. But SEPA's website still shows a little-reported speech by Mr Pan in 2006 in which he said cancer experts believed that 70% of China's more than 2m annual deaths from the disease were pollution-related. The World Bank had been planning to blame pollution for just 750,000 deaths from various causes.

Chinese officials were worried that the World Bank's figures would cause unrest. But environmental awareness—and anger—is mounting anyway. Of complaints submitted to government departments, 13% relate to pollution, up from fewer than 6% three years ago. And SEPA officials say pollution-related disturbances are also becoming more common—51,000 in 2005 and more than 60,000 in 2006. Such protests are more likely than SEPA's efforts to goad reluctant officials into action.

Posted by: Shimin

2008-04-03T09:53:00.002+08:00

TIME: FAKING IT

June 6, 2005, TIME magazine, by Matthew Forney

Silk Alley in Beijing was probably the world's most infamous market for fake consumer goods. Located within sight of the U.S. embassy, the noisy outdoor warren of stalls became such a magnet for foreign tourists that Lonely Planet's guidebook to Beijing suggests backpackers shop there for Gucci handbags, Nike sneakers and a host of other designer products, few of them authentic but most so meticulously duplicated by Chinese manufacturers that no one could tell the difference. "Silk Alley" was also the bane of trademark lawyer Joe Simone. As the top foreign anticounterfeiting lobbyist in China, Simone had for years urged senior Communist Party members, commerce officials, and local bureaucrats who collected rent from the stall owners, to close the market. Finally, in January, the government tore it down. "If the silk market cannot flourish without counterfeits, we prefer that it not flourish," said a government official. Simone's reaction: "I was psyched."
The victory was short-lived. From the rubble of the old market has risen a five-floor department store packed with four times as many vendors selling fakes as there were in the old alley. About the only brand that's not counterfeit is that of the market itself, which has erected signs on every floor welcoming shoppers to "Silk Street." To add to the irony, a notice at the main entrance lists a dozen luxury brands that must not be sold on the premises; nearly all are available within, able to be bought with major international credit cards. "Somebody must have sent a message to vendors saying, 'Don't worry, you can sell counterfeits,'" Simone says.
Simone's frustration at China's failure to effectively protect intellectual property (IP) now reverberates through Washington. American companies complain that Chinese piracy of virtually anything valuable�brands, software, films, music, business processes, ideas�threatens legitimate enterprises everywhere. And it's not like China just popped onto the radar screen. The country is on track to record a $200 billion trade surplus with the U.S. this year, and American politicians are dyspeptic. In recent weeks, the U.S. has erected quotas on textile imports from China and hectored Beijing over its refusal to revalue its currency, while members of Congress have threatened blanket tariffs on imports from China. In Beijing last week for a meeting with his Chinese counterpart, U.S. Commerce Secretary Carlos Gutierrez challenged China's leaders to rein in copycat factories and rogue retailers. "Violating intellectual-property rights is no different from counterfeiting money," he told reporters. "We would like it to be treated that way." Plenty of other countries are used as safe harbors by commercial pirates, but China is perhaps one of the worst offenders. Chinese copycats cost the U.S., Europe and Japan more than $60 billion in retail sales last year, according to U.S. Commerce Department estimates, and Chinese fakes are increasingly being exported worldwide. U.S. Customs reports that 63% of all counterfeit goods it seized last year came from China, up from 16% five years earlier. It's estimated that half of all shipments of fake products stopped by Chinese customs at export points are sneakers bearing Nike and Adidas brands. Even Chinese companies are being damaged by the trade, with everyone from the State Tobacco Monopoly Administration to the Inner Mongolian-based Little Sheep chain of Mongolian hot-pot restaurants complaining that their brands have been hijacked.
As the U.S. has grown irate, China has dug in. A delegation of Chinese commerce officials visited Washington at the end of last month to meet with U.S. Trade Department officials and groups like the U.S.-China Business Council. Stunned listeners heard Vice Commerce Minister Ma Xiuhong blame foreign companies for encouraging counterfeits by placing orders with Chinese factories that churn out fakes on the side. "China is aggressively defending its position," says an executive who attended the meetings. "It's going to be a real fight."
Leading that battle on the ground is Simone, the lawyer who targeted "Silk Alley." As a Beijing-based partner in the American law firm Baker & McKenzie, Simone's clients include more than 30 firms that own household-name brands (which he declines to name, citing confidentiality agreements). He meets often with Chinese officials as a member of two antipiracy business groups�the International Trademark Association and the Quality Brands Protection Committee. During his 15 years in China, he has worked with local officials to organize more than 500 raids on factories across the country.
Although his job occasionally calls for hardball tactics, Simone, who once studied acting at Penn State, prefers to play a more diplomatic role as the business community's ambassador of brands. Unlike some other foreign lobbyists, he is careful not to accuse the Chinese government of condoning IP theft. For example, Simone recently met with officials from the Ministry of Finance to explore how foreign companies might help tackle the problem of tax revenue lost to piracy. In a conference room overlooking the new "Silk Street" market, Simone emphasized in fluent Chinese that he is "100% friendly," adding that "people in Washington are complaining loudly, but they often don't know the facts." Then he notes, almost in passing, that police have arrested more than 10,000 people in a six-month crackdown on gambling. Why, he asks officials, don't they arrest more counterfeiters?
It's a rhetorical question that Simone answers himself. Chinese state enforcement agencies barely work together, he informs the finance officials, who are unfamiliar with how crackdowns are launched. He explains that the government body that investigates fake goods, the State Administration of Industry and Commerce (SAIC), can only impose fines and close factories, and that's not enough. "Factory owners aren't afraid of fines" because they're too low. "What people are afraid of is the police," he says. But in a country with rising rates of violent crime, busting counterfeiters of, say, fake Hello Kitty notebooks is a low priority. Simone explains that to increase the number of criminal arrests that could lead to jail time, local SAIC offices must build cases, often with the help of foreign firms, and then hand them off to the police. But that rarely happens. In the first half of last year, he says, the SAIC passed only 14 investigations to the police.
Simone concludes the meeting with a recitation of other obstacles to IP enforcement, such as bureaucrats he suspects are shielding factories engaged in piracy since they provide local jobs. Simone also suggests to the Finance Ministry officials that China's current leaders aren't aggressive enough about the issue. He recalls that former Premier Zhu Rongji complained after personally buying fake, shoddy products, but Simone thinks that level of attention is lacking now. "We hear a lot of talk from other officials, and in the end, improvement is way too slow," he concludes. After two hours the meeting adjourns with handshakes and promises of cooperation. As Simone steps into a taxi outside, a woman offers him a pair of fake Boss socks.
That afternoon, Simone meets one of his Chinese investigators at "Silk Street." The fourth floor is crammed with watch vendors pitching "Super-A" fakes�a designation that counterfeit vendors in China use to mean near-perfect quality. About half the shoppers are foreign, but Simone is by far the biggest and loudest. "Fakes are good!" he yells in Chinese, playing the dopey consumer. "Fakes are cheap!" His old acting classes are paying off�vendors gather to laugh at his display of astonishment as a salesgirl proves with a screwdriver that the glass on her fake Omega watch is scratchproof. The sheer quantity of contraband overwhelms him, and this time he's not acting. "When I came here, I expected the worst," he says on the way out. "But I never thought it would be this well organized and financed."
The government doesn't wholly ignore the problem. The minister now in charge of policy on intellectual-property rights (IPR), Vice Premier Wu Yi, promised to crack down on abuse more than a year ago. China inaugurated an annual "IPR Protection Week," with billboards in Beijing urging passersby to "Sternly Beat Down Counterfeits." Steamrollers across China crushed truckloads of pirated CDs and DVDs seized by authorities, the destruction broadcast on prime-time TV. Police launched "Operation Mountain Hawk," which helped push the number of criminal prosecutions involving IP theft to 385 last year, up 75% from 2002. Censors even allowed a hundred Chinese pop singers, led by aging rock star Cui Jian, to hold a concert that encouraged fans to buy authentic CDs. Most important, the nation's highest court issued a "judicial interpretation" last December that carries the weight of law and purports to make it easier to launch criminal proceedings in IP cases. Wu Yi said in January that China was making "new headway" against counterfeiters.
But Simone and others say the steps are insufficient. A few years ago, pirated DVDs were peddled on the street by furtive migrants from the hinterland. These days they're sold openly in shops and often hit the market before first-run films arrive in cinemas. The Motion Picture Association (MPA) says factories in China use machines costing hundreds of thousands of dollars with a capacity to stamp at least 3.5 million discs a year. They retail in Beijing for about $1 apiece. Hollywood studios lose the market not just for DVDs but also for viewers who might otherwise visit theaters�a problem compounded by a state-imposed limit of 20 first-run foreign films each year. Says Mike Ellis, head of Asia operations for the MPA: "China has not made substantial progress toward a reduction in copyright-infringement levels."
Foreign firms face great difficulty prodding police into action. In February, General Motors received complaints that faulty spark plugs bearing its AC Delco brand were damaging engine cylinders in North America. GM traced the counterfeit plugs through a Canadian importer to the Chinese plant that made them. But the factory owners were careful, GM says. According to the new judicial regulations issued in December, police must find $18,000 worth of counterfeit goods to launch a criminal investigation. Because the spark-plug factory produced to order and shipped its goods out immediately, it had no contraband in its warehouse. "We couldn't persuade the police to seize goods or arrest the owners" because there wasn't enough merchandise to make a case, says Alex Theil, director of investigations for GM in Asia. "Proof should be the outcome of a criminal investigation, but here, proof must come at the start."
Other investigations are stymied by the officials charged with leading them. Last week, Michael Feng, an enforcement officer for sneaker maker Puma, led a delegation from a local SAIC on a raid of a factory in a part of Fujian province notorious for knocking off footwear. The factory, Feng says, was a "pure Puma counterfeiter" that made nothing else. In fact, it had been raided weeks earlier and was supposed to have been closed down. When Feng and his team arrived, however, the SAIC seals over the door were broken and the plant was operating as before. The official whose order had been flouted didn't seem to care. "I said, 'Hey! What are you going to do?'" Feng says. "He just laughed at me."
Yet the biggest problem might not lie in the provinces but in the capital. Last week, Simone met with Liu Juntian, an expert on IP law at People's University, to sound him out on the mood of China's political leaders regarding counterfeiting. "It's a matter of political will," Liu said. "The [Communist] Party is concerned with stability over everything else. It sees people at the bottom of society selling cheap goods to poor people, and thinks that is stabilizing." The abstract concept of IP rights barely factors in the calculations, according to Liu.
In the end, it seems, China's counterfeiters consistently stay a step ahead of those who would shut them down. One of Simone's great successes was cleaning up an indoor market next to Beijing's Temple of Heaven. Vendors at the market stopped displaying most of their fakes a few months ago after Simone threatened a lawsuit. That's nice�but now they instead display catalogs of items like the latest Louis Vuitton handbags. Buyers choose a bag and are then led down an alley to a warehouse stuffed with "Super-A" fakes. One is a knock-off of a Louis Vuitton wallet bearing a cherry design that isn't yet officially available in Beijing. "Look how the design on the leather cuts off at the edge, just like the real one," says a salesgirl, comparing her product with the catalog photo. She offers the bag at one-eighth the price of the genuine item. "It's regrettable that we consider that progress, but it is progress," Simone says. "They're not that afraid on 'Silk Street.'"
With reporting by Hannah Beech/Shanghai, Susan Jakes/Beijing and Austin Ramzy/Hong Kong

Posted by: Shimin

2008-04-02T23:42:00.002+08:00

IOC Tells Beijing: Don't Block Internet
IOC Wants Beijing Not to Block Intenet Access During Olympics
By STEPHEN WADE AP Sports WriterBEIJING Apr 1, 2008 (AP)

The Internet must be open during the Beijing Olympics. That was the message a top-ranking International Olympic Committee official delivered Tuesday to Beijing organizers during the first of three days of meetings — the last official sessions between IOC inspectors and the Chinese hosts before the games begin in just over four months.
Beijing routinely blocks Chinese access to some foreign news Web sites and blogs, a practice it has stepped up since rioting broke out over two weeks ago in Tibet.
Kevan Gosper, vice chairman of the IOC coordinating commission, said restricting access to the Internet during the games "would reflect very poorly" on the host nation.
"This morning we discussed and insisted again," Gosper said. "Our concern is that the press (should be) able to operate as it has at previous games."
Gosper said the Chinese had an obligation under the "host city agreement" to provide Internet access to the 30,000 accredited and non-accredited journalists expected to attend.
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"There was some criticism that the Internet closed down during events relating to Tibet in previous weeks," Gosper said.
Laws that lifted most restrictions on foreign media went into effect Jan. 1, 2007. The rules are due to expire in October.
"I'm satisfied that the Chinese understand the need for this and they will do it," Gosper added.
When asked about Gosper's comments, Foreign Ministry spokeswoman Jiang Yu said China's "management" of the Internet followed the "general practice of the international community."
She acknowledged that China bans some Internet content, and said other countries did the same. She declined to say if the Internet would be unrestricted for journalists during the Olympics.
Gosper spoke after Hein Verbruggen, chairman of the inspection committee, addressed his Chinese hosts. Without being specific, Verbruggen noted that China's Aug. 8-24 games had become embroiled in controversy.
The unrest in Tibet — and China's response — has heightened calls for a boycott or a partial boycott of the games. This comes in the wake of worries over Beijing's polluted air, and calls for China to increase pressure on Sudan to end fighting in Darfur.

Lydia's commentary:
With the Olympics kicking in this August, the directors of this augural event is steeping in to ensure that China does not impose its censorship on the Internet. For many years, the government has prevented taboo topics such as Tiananemn Square Incident in 1989 from being searched on the net. Search engine giant Yahoo! has received warnings from the government to block the engine results generated otherwise it would ban the website entirely. Yet, the citizens have worked around this system and found a loophole in which they post on their blogs and online journals for discussions. With the increasing popular Internet as the latest media, it has become a platform for netizens to discuss issues they were formerly restricted from in the past. By pressing its authority on the state, the IOC of the Olympics 2008 ensures that the blockades on the internet would be removed to ensure that freedom of speech is allowed.

2008-04-02T23:27:00.002+08:00

US: Olympic Host China Lacks Freedoms
http://abcnews.go.com/Politics/wireStory?id=4429558
US Lists Rights Abuses in China, Russia, Iraq, Others in Annual Report
By ANNE GEARAN AP Diplomatic WriterWASHINGTON Mar 11, 2008 (AP)

The United States branded China an authoritarian human rights abuser Tuesday, citing alleged torture, state control of basic aspects of daily life, tight controls on religion and harassment of foreign charities.
China, host of the summer Olympics, has rampant and chronic human rights problems despite rapid economic growth that has transformed large parts of Chinese society, the State Department said in its annual accounting of human rights practices around the world.
The world's most populous nation, China is an increasingly important U.S. trade partner and a chief competitor with the United States for energy and shrinking natural resources. It is the object of broad U.S. economic and diplomatic outreach, with mixed results.
The United States, other nations and outside advocacy groups have tried to use the world media attention and prestige associated with the Olympics to leverage internal change and diplomatic cooperation from China, but the games are barely mentioned in the human rights report.
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"The government tightened restrictions on freedom of speech and the press, particularly in anticipation of and during sensitive events, including increased efforts to control and censor the Internet," the report said.
Forced relocations went up last year, the report said. It noted claims that people were forced from their homes to make way for Olympic projects in Beijing.
President Bush plans to attend the Olympics this year. Visiting U.S. lawmakers would get help from the U.S. Embassy for a "safe, memorable and enjoyable experience," the U.S. ambassador in Beijing wrote in a letter last year.
The report detailed the lengths some Chinese officials have taken to enforce their country's well-known "one child" policy, and gave a chilling account of alleged torture in China, including the use of electric shocks, beatings, shackles, and other forms of abuse. It includes an account of a prisoner strapped to a "tiger bench," a device that forces the legs to bend sometimes until they break.

Lydia's commentary:
Ever since winning the bid to host the Olympics 2008, China has been receiving much scrutiny under worldwide press regarding its efforts to spruce up the city for this event. Yes, I do agree that it has made China more well-known and recognised on the international platform on its every move, yet, this has proven to be a double-edged sword. The state has been criticized by the West on its dirty history of human rights abuse during the draconian One-Child Policy and political experiments Great Leap Forward and Cultural Revolution. Much of the stories have been laid out right in fron of the world to comment and I believe it has been hard on the government to justify for its past leaders actions. While I do believe that China has earned itseld as a country worthy of mention with its significant economical changes, it is hard for them to stay away from its haunted and tainted past.

2008-04-02T23:14:00.002+08:00

China Snow Crisis Shows Vulnerability

http://www.abcnews.go.com/Business/BusinessTravel/wireStory?id=4214252

Impact of China's Snow Crisis Spreads, Highlighting Weaknesses of Booming Economy
By ELAINE KURTENBACH and WILLIAM FOREMAN Associated Press WritersSHANGHAI, China Jan 30, 2008 (AP)

China's worst winter storms in five decades have highlighted the vulnerabilities of the country's booming economy, bringing transportation and much industry to a halt and prompting the government to deploy nearly 500,000 army troops to assist troubled areas Wednesday.
The remains of an outdoor market are seen after it collapsed following a heavy snowfall in Loudi, in central China's Hunan province, Tuesday Jan. 29, 2008. China struggled Wednesday to cope with its worst winter storms in five decades, with transportation snarled and cities paralyzed, and more bad weather forecast. Snow and ice storms have struck east, central and southern China for more than two weeks, causing dozens of deaths, collapsing buildings and forcing the closure of highways and airports. (AP Photo/EyePress)
Snow and ice storms in east, central and southern China at no more than a foot of snow overall in some places have overloaded businesses, the electricity grid and other systems that normally keep the economy ticking at double-digit rates. The weather was unusual for those regions, and they were ill-equipped to handle it.
China's already overburdened railways, coupled with an incomplete road system, buckled under the added pressure as tens of millions of Chinese were on the move for the Lunar New Year one of the world's biggest annual mass movements of humanity.
Before the storms, railway officials estimated a record 178.6 million people more than the population of Russia would travel by train for the holiday, which begins Feb. 7.
The complications illustrate the limitations China faces, despite 30 years of economic reforms that have turned it into an export juggernaut, with economic growth forecast at more than 10 percent this year.
China's antiquated and inefficient power grid, which is powered largely by coal, ground to a near halt, plunging many cities into darknessTop of Form
Bottom of Form
Dozens of factories were closed, with mining and metals companies suffering from severe power shortages. The storms have caused economic losses of $3 billion since they began Jan. 10, the Civil Affairs Ministry said Tuesday.
Meanwhile, the China Meteorological Administration said the bad weather, including more snow, would continue for at least the next three days in parts of eastern and southern China.
China's leaders, who held an emergency meeting Tuesday, deployed more than 450,000 army troops and extra units of police to clear roads and help provide emergency supplies to the millions of travelers stranded by the weather, state-run media reported, saying authorities had declared an "all out war" on the crisis.

Lydia's Commentary:

This article highlights the detrimental impacts brought about by the most disastrous snowstorm to ever hit China in 50 years. It only made it more apparent that China, despite its booming economy, is ultimately vulnerable to the forces of nature. Millions of people have staged unrest as they are frustrated by the lack of efficiency by the government, as well as the desire to be with their loved ones over the Spring Festival. I feel that the government should treat this as a wake-up call that the country do have to repair the loopholes such as poor transportation sytem that has been neglected and glossed over by the them. This is also a good time for major countries to improve thier strained realtions with China by extending a helping hand as it seems too exaggerated a problem to be handled alone.

In China, there's priceless, and for everything else, there's cash

2008-04-02T22:44:00.001+08:00

Title: In China, there's priceless, and for everything else, there's cash
Source: http://www.time.com/time/world/article/0,8599,1643445,00.html
Date: 13th July 2007

Shenzhen may be a lovely place to visit, but I wouldn't know. Like many tourists to this southern Chinese boomtown, I barely got past the first shopping mall after the border crossing, Luohu Commercial City, an emporium of counterfeit goods at bargain prices. On its six floors, you can purchase nearly anything: handbags, golf clubs, watches, couture dresses, even pharmaceuticals. But be sure to hit the ATM first.

The Chinese are believed to have issued the world's first paper currency around 600 A.D., and fourteen centuries later, cash remains king. Cars and houses are bought, and even salaries are often paid, with thick envelopes of bills. To date, banks have issued only slightly more than 50 million credit cards to a population of 1.3 billion, according to a recent study done by the payment processing company First Data International. Credit card debt remains minimal — 85% of cardholders pay the full balance off each month. By comparison, Americans possess 640 million cards — more than double the population — with the average card-holding household owing an estimated $9,500.

One reason for this disparity is that only 4% of merchants in China even accept credit, concerned that handling fees will eat into already tiny margins. Nowhere is that more clear than Luohu Commercial City. By its very nature, such a robust trade in fake products couldn't survive without cash. Shopkeepers make change from wads of renminbi stuffed in suitcases or pockets. At the few stalls that do accept plastic, it's not without an extra fee that can range anywhere from five to 20%. When, after six hours of shopping and short on funds, I couldn't even use my Amex to pay for dinner. "Cash only," the waiter insisted.

Even those in China who do have plastic rarely use it to buy much. Less than 50% report using it to purchase anything, and most who do spend less than $1,000 a year, an amount many Westerners can blow through in a week. China's is still largely a culture of savings. Retail sales grew about 12% last year to $800 billion, but studies show that households generally sock away a quarter of their total income, and spend almost the same proportion on food. It may be hard to believe after a day shopping in Shenzhen, but despite having the world's largest population, China accounts for less than 5% of global consumption.

Saving for a rainy day may sound smart, but some observers say this habit could be hindering China in the long run, and disrupting global trade balances. Access to consumer debt could ease the country's dependence on exports and investments that now power China's 10% annual growth, ultimately making it more sustainable. "Mature economies are driven by consumer spending," says Nigel Lee, president of First Data's Asian operations. "Consumer credit is an important instrument in increasing domestic demand."

The Chinese government doesn't entirely disagree. At the urging of the U.S., the country has undertaken vast reforms of its banking sector over the past five years, including opening up the system to foreign banks offering debit cards. But officials remain cautious about letting consumer debt grow too fast, and have maintained safeguards such as low credit limits. Wang Huaqing, assistant chairman of the China Banking Regulatory Commission, recently told the Washington Post that such decisions come from reports of people taking out loans to speculate in the stock market or on real estate, adding the indebtedness of young Americans was also a cautionary tale. "We have been paying great attention to credit card risk and loan risk," Wang said.
Which is not to say things aren't changing
. Bank ATM cards are now ubiquitous, with more than 1 billion in circulation in China. And, in 2006 the number of credit cards shot up 39%, and the total is expected to double again this year. Whereas banks barely break even now on such business, McKinsey estimates by 2013, China's consumer credit card profits could hit $1.6 billion. Indeed, at a Shenzhen Starbucks, I watched as a young woman paid for her caramel macchiato with a Beijing Olympics-branded Visa, one of what seemed to be several cards she had in her wallet. We were just down the block, but Luohu's bustling cash trade seemed a universe away.

The new colonialists

2008-04-02T22:25:00.002+08:00

Title: The new colonialists
Date: Mar 13th 2008
Source: From The Economist print edition
http://www.economist.com/opinion/displaystory.cfm?story_id=10853534

China's hunger for natural resources is causing more problems at home than abroad

THERE is no exaggerating China's hunger for commodities. The country accounts for about a fifth of the world's population, yet it gobbles up more than half of the world's pork, half of its cement, a third of its steel and over a quarter of its aluminium. It is spending 35 times as much on imports of soya beans and crude oil as it did in 1999, and 23 times as much importing copper—indeed, China has swallowed over four-fifths of the increase in the world's copper supply since 2000.

What is more, China is getting ever hungrier. Although consumption of petrol is falling in America, the oil price is setting new records, because demand from China and other developing economies is still on the rise. The International Energy Agency expects China's imports of oil to triple by 2030. Chinese demand for raw materials of all sorts is growing so fast and creating such a bonanza for farmers, miners and oilmen that phrases such as “bull market” or “cyclical expansion” do not seem to do it justice. Instead, bankers have coined a new word: supercycle.

Not all observers, however, think that China's unstinting appetite for commodities is super. The most common complaint centres on foreign policy. In its drive to secure reliable supplies of raw materials, it is said, China is coddling dictators, despoiling poor countries and undermining Western efforts to spread democracy and prosperity. America and Europe, the shrillest voices say, are “losing” Africa and Latin America.

This argument ignores the benefits that China's commodities binge brings, not only to poor countries, but also to some rich ones, such as Australia. The economies of Africa and Latin America have never grown so fast. That growth, in turn, is likely to lift more people out of poverty than the West's faltering aid schemes.
Moreover, China is not the only country to prop up brutish regimes. Witness the French troops scattered around Africa, some of whom recently delivered a shipment of Libyan arms to Chad's embattled strongman, Idriss Déby.

A new nuance
China could—and should—use its influence to curb the nastiest of its friends, including the governments of Sudan and Myanmar. And it is beginning to do so. It has ceased to resist the deployment of United Nations peacekeepers in Darfur, and is even sending some of its own military engineers to join the force.
Wen Jiabao, China's prime minister, has called publicly for democracy in Myanmar—which, even though Chinese officials' understanding of democracy is different to Westerners', is a bold step for a government that claims not to meddle in other countries' internal affairs. The more business China does with the rest of the world, the more nuanced its foreign policy is likely to become.
Still, China's hunger for natural resources is creating plenty of problems. Most of them, though, are in China, not abroad.
China is hoovering up ever more commodities not just because its economy is growing so quickly, but also because that growth is concentrated in industries that use lots of resources. Over the past few years, there has been a marked shift from light manufacturing to heavy industry. So for each unit of output, China now consumes more raw materials.
That may sound like a minor change, but the implications are dramatic. For one thing, it has encouraged the sort of foreign entanglements that are now causing China such embarrassment. More worryingly, it is compounding China's already grim pollution.
Heavy industry requires huge amounts of power. Steelmaking, for example, uses 16% of China's power, compared with 10% for all the country's households combined. By far the most common fuel for power generation is coal. So more steel mills and chemical plants mean more acid rain and smog, not to mention global warming.
These are not just inconveniences, but also an enormous drag on society. Each year, they make millions sick, cause hundreds of thousands of premature deaths, sap agricultural yields and so on. Pan Yue, a deputy minister at the government's environmental watchdog, believes that the costs inflicted by pollution each year amount to some 10% of GDP.

No fire without smoke
It is no wonder, then, that pollution is the cause of ever more protests and demonstrations. There were some 60,000 in 2006 alone, by the authorities' own count. Some are led not by impotent peasants but by well-organised burghers from Shanghai and Xiamen, a development that must horrify China's rulers. And the potential for even more disruptive environmental crises is great: northern China is already running out of water, and the glaciers that feed its dwindling rivers are melting, thanks to global warming.
The government is aware of these problems, and is trying to address them .It has used this month's People's Congress to raise the status of Mr Pan's agency to a ministry. It has increased fines for pollution, reduced subsidies on fuels and scrapped tax breaks for heavy industry. It is also promoting cleaner sources of power, such as windmills and natural gas. Yet despite frantic efforts to clean up Beijing in time for the Olympics in August, athletes still doubt the air will be fit to breathe.
The world's fastest marathon runner, for one, has threatened to drop out of that race because of pollution.
All the government's green schemes are being undermined by an artificial abundance of cheap capital, and by bureaucrats' enthusiasm for channelling it to grubby industries. Chinese banks, with the government's blessing, pay negative real interest on deposits and so can lend to state-owned firms very cheaply. Many of those firms also benefit from free land and pay negligible dividends to the state, leaving lots of money to invest in more dirty factories. Chinese depositors and taxpayers are subsidising the very industries that are slowly poisoning them.
China is bound to consume enormous amounts of raw materials as it develops. But given how polluted the country already is, and how much unrest that pollution is causing, it should curb its hunger for resources. A less wasteful development strategy would be a healthier one.

China's dilemma over Darfur

2008-04-02T16:09:00.006+08:00

Source from : BBC News
http://news.bbc.co.uk/1/hi/world/asia-pacific/7242725.stm
By Michael Bristow
BBC News, Beijing
Article Date : Wednesday, 13 February 2008
Provided By : Ronald Koh

China has worked hard over the past few months to show it is doing all it can to resolve the humanitarian crisis in Sudan's Darfur region.

It has appointed a special envoy, sent peacekeeping troops to the region and embarked on a publicity campaign to persuade others it is being responsible.

This was done in part to prevent anyone linking China's close relationship with Sudan to the Olympics Games.

But for Steven Spielberg it was still not enough.

His decision to withdraw as artistic adviser to the Games' opening and closing ceremonies will be seen as a huge blow.

Lucrative friendship

Beijing and Khartoum have long had strong political, economic and military ties.

China imports two-thirds of Sudanese oil - estimated at 500,000 barrels a day.

Last year, it imported a total of $4.1bn ($2.0bn) worth of goods from Sudan, mostly oil.

China is also believed to be Sudan's biggest arms supplier.

Because of this strong relationship, Chinese leaders have traditionally resisted international pressure to use their clout to bring peace to Darfur, where there is conflict between government-back militias and rebels.

Beijing has even used its veto at the UN Security Council - to block moves to impose sanctions on Sudan if it fails to stop the fighting in the troubled region.

China's stock response to outside criticism about its Darfur policy always used to be that other countries should not involve themselves in Chinese affairs.

More involvement

But last year Beijing made a slight adjustment to that policy, appointing an envoy to Darfur, Liu Guijin.

He is an experienced diplomat who knows Africa well, having served as ambassador to both Zimbabwe and South Africa.

China also agreed to send in peacekeepers to the region as part of a UN force.

A total of 135 soldiers, who will not be engaged in frontline duties, have already arrived in Darfur.

China did this after more than 100 US legislators signed a letter last year calling on Beijing to take immediate action to stop the violence in Darfur, which the UN says has left more than 200,000 people dead since 2003.

The London-based human rights organisation, Amnesty International, also claimed that China was selling weapons to Sudan in violation of a UN arms embargo.

Other human rights activists have called on countries to boycott the Beijing Olympics this August because of China's close relationship with Sudan.

And Hollywood star Mia Farrow voiced her own criticism, coining the phrase “genocide Olympics”, words that must have made Beijing officials shudder.

Olympic pressure

So China is currently attempting a delicate balancing act - trying to manage the expectations of the international community while maintaining close ties with Khartoum.

It adjusted its Darfur policy because it wants to be seen as a responsible player on the world stage, with a diplomatic stature to match its growing economic might.

More importantly, it does not want anything to impact on the Olympic Games.

It is not clear how Mr Spielberg's decision will affect the Olympics. But some analysts doubt it will lead to others cutting their links with the event.

“Most sponsors have anticipated this kind of an issue, are prepared to deal with it, and will continue to support the games,” said David Wolf, from media consultants Wolf Group Asia.

Chinese leaders will be hoping he is right.

Not just made in China

2008-04-02T11:11:00.001+08:00

Source: Newsweek
URL: http://www.newsweek.com/id/123445
Provided by: Beverly Li

Not Just Made In China
A wide-ranging exhibit at the V&A celebrates the country's flourishing culture of design.

Jessica Au
NEWSWEEK
Updated: 10:33 AM ET Mar 15, 2008

The notion of Chinese design typically conjures up images of Ming furniture, blue and white ceramics and Mao suits. But "China Design Now," the impressive new exhibit at London's Victoria and Albert Museum (through July 13), includes not a single dragon motif, let alone a dragon robe. Instead, toy panda sculptures about the size of small children are flanked by pairs of limited-edition Nike sneakers with bamboolike stitching and built-in acupuncture-type cushions. On the wall hangs a series of colorful skateboards decorated with ironic Maoist slogans and caricatures of revolutionary guards. The adjoining rooms feature elegant garments by Shanghai's top fashion designers, as well as models of Beijing's major Olympic architectural projects, including the National Stadium, a tangled pattern of steel, aptly nicknamed the "Birds' Nest."

The show makes one thing very clear: this is not your Ming dynasty's China. Home to a tech-savvy generation of talented young designers, the country has come a long way in the past decade. Four years in the making, "China Design Now" stylishly explores the country's rapidly evolving design culture and features the works of more than 100 of the most innovative Chinese designers, including animators and architects. "Young designers today are very creative in the ways that they blend traditional Chinese influences together with other global design trends, like Japanese Manga cartoons, Korean fashion and Brit pop," says Zhang Hongxing, an expert in Chinese painting who co-curated the exhibition with Lauren Parker, the V&A's Head of Contemporary Programmes. "Chinese design will take off in the next five to 10 years, in much the same way that Chinese contemporary art has." Bolstered by runaway economic growth, China, as the show demonstrates, is no longer content with producing knockoffs and cheap foreign goods. It wants to renew its tradition of innovation, which included the advent of the printing press, silk and gunpowder. "The higher-end of manufacturing in China, such as mobile-phone design, is going to become the next big thing," says Parker.

As the exhibit makes clear, the Chinese have rekindled their love for retail therapy. The country is the world's largest market for mobile phones and is soon set to overtake the United States as the second biggest consumer of luxury goods after Japan. Forty years ago, the "Four Great Things" (si dan jian) of consumer desire included a bicycle, a watch, a sewing machine and a radio. Now, as the 200-plus projects on display suggest, it's a Motorola flip phone, a Mercedes-Benz, an Apple MacBook and an apartment designed by architect Ma Qingyun. China's yuppie generation once lusted solely after foreign luxury labels as a symbol of status and wealth. But today's urban youth are becoming increasingly receptive to homegrown fashion designs, like the dumpling-inspired backpack by Wang Yiyang, on display in the middle hall, and geometric-cut evening dress by Han Feng. "Young people are now starting to wear clothes designed by their own designers rather than aspiring to buy top Western brands like Gucci, Dior and Prada," says Zhang.

The exhibition is structured around the three cities that have shaped China's emergence in the world: Shenzhen, Shanghai and Beijing. The journey begins in the country's manufacturing and graphic design center, Shenzhen, where the average age is just 27. Highlights include a poster designed by Wang Xu that promoted the nation's first Graphic Design exhibition in 1992, depicting two legs intertwined—one clad in traditional Chinese dress, the other in a Western-style business suit. In the adjacent hall, opulent haute couture by leading designers, such as Lu Kun and Ma Ke, as well as glossy portraits of porcelain painted girls by Wing Shya and Chen Ma evoke the glamour of 1930s Shanghai. In the final room, Beijing's latest architectural projects, as well as hugely ambitious new urban planning schemes, are expertly visualized: the new Olympic communications center by architect Zhu Pei; Dongtan, the world's first eco-city, which is being constructed on Chongming Island, off Shanghai, and Thames Town, a residential project in Songjiang modeled on an old, English-style town.

The role of the designer is a new notion in post-reform China. The first generation of graphic artists were trained in traditional fine-arts academies in the early 1980s, where they had no historical or international context for their work and little opportunity to explore their ideas. "China Design Now" shows how the country's new generation of designers are far more worldly and versatile, spurred on by social networks and popular chat forums. They are also able to work across genres, as evidenced by the array of books, CD covers, T shirts, toys and animation by design alliances like MEWE (Guang Yu, He Jun and Liu Zhizhi) and Perk (Jin Ningning and Sei Wei). There are now more than 550 design schools across China, many of which have sprung up only in the last 10 years, and hundreds of design consulting firms in Shanghai, Beijing and Guangzhou.

Still, there are hurdles to overcome. One obstacle is the substandard teaching in many of China's hastily founded design schools. Another is the legacy of the Cultural Revolution, which cut off the country's rich decorative-arts tradition and has left a mark on the current national curriculum, where creativity and design are often not high on the agenda. Yet there is plenty of scope for optimism. "Since 1992 we've seen a really rapid process in Chinese design culture," says Parker. "If that case carries on in the next three or four years, Chinese architects and fashion designers will be seen as part of the international design community and not just singled out because they are Chinese." Soon, gadgets like the iPhone, may not just be made in China, but designed there, too.

XI Jinping: China's New Boss and the 'L' Word

2008-04-02T11:04:00.003+08:00

Title: XI Jinping: China's New Boss and the 'L' Word
Source: http://www.newsweek.com/id/81558/page/1
Date: 22nd Dec 2007
Labels: Government
By Jonathan Ansfield and Melinda Liu NEWSWEEK

Rarely has the word-of-mouth surrounding a new Chinese star differed so dramatically from his official résumé. Xi Jinping was anointed in October as the likely successor to President Hu Jintao as party chief in 2012, and his canned bio says little about his family history.

But 's gossip mills have been churning overtime. Turns out Xi's dad, revolutionary hero Xi Zhongxun, was purged three times by Mao Zedong and later became a pro-market reformer.
He was also one of the few leaders to defend Hu Yaobang, a progressive party chief sacked in 1986, and to condemn the 1989 Tiananmen Square massacre—after which he was rarely seen in public again.

Were such facts better known, they might raise awkward questions for his son. Thus China's state-run media has avoided the subject, and Xi Jinping has deflected questions about his dad—and his influence on Xi's philosophy. That's left China's new boss a mystery. About the only things analysts can agree on is that he's market-friendly, prudent, and married to a famous singer. Where Xi's heart really lies is unknown.

What is clear is that Xi is popular within the party. His selection as heir apparent this fall surprised many, and came at the expense of Li Keqiang, Hu's handpicked successor. Seems that the president's rivals thought Li was too similar to his mentor in outlook and style. So Xi, who topped a shortlist of up-and-comers in intraparty polling, emerged as the consensus pick instead.

Xi owes much of his popularity to his man-of-the-people image, which he came by early. During the Cultural Revolution in 1968, the 15-year-old Xi was sent to the countryside for a stint of manual labor. Down in rural Hebei province, while his father was being publicly denounced back home, the young Xi impressed the locals with his modesty and hard work—so much so that, by 21, they'd made him a local party chief and recommended him for university.
Xi, now 54, has carried this history as a badge of honor ever since and avoided signs he's a pampered son of the elite. When he was vice mayor of Xiamen in 1987, for example, he sometimes favored simple windbreakers over Western business suits and mini-buses over chauffeured cars. "He was unusually easygoing and down to earth," one official recalls.
This manner has won Xi plaudits from no less a figure than Singapore's Lee Kuan Yew, who declared on a recent visit that Xi was "a thoughtful man who has gone through many trials and tribulations." "I would put him in the Nelson Mandela class," Lee declared.
That may be, but Xi's shown no signs he plans to follow his dad's principled example—much less risk prison for his ideals, like Mandela. China's leaders have become less and less bold since Tiananmen, as the party has placed increasing emphasis on consultation and consensus. It's thus hard to imagine any of them attempting big changes in the near future, says Jin Zhong, editor of Open Magazine in Hong Kong. "Even if they wanted to, they wouldn't dare."
Sure enough, Xi's recent record has been carefully conservative. During a brief stint as Shanghai party secretary from last March to October, Xi "didn't touch any of the sensitive, thorny issues," says Jin, such as the massive pension-fund scandal that had toppled his predecessor or the detention of local activists. Instead, Xi dutifully promoted Beijing's policies, including its prescriptions for more measured growth.

Expect more of the same in Xi's new roles, which include being party point man on Hong Kong. Democrats there have been clamoring for full suffrage, and the city's tabloids are following Xi's every move to see what he might deliver. Brookings scholar Cheng Li notes that Xi "has not been impressive" in recent ventures. Still, he has an "open-minded leadership style." And under the circumstances—with an uptight, micromanaging Hu Jintao still in charge of China—open-minded is probably the most anyone should hope for.

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Comments: Xi Jinping is a rising star in the CCP and many see him as Hu Jintao's successor. What's interesting is his father's background

( bell ring continue later)

Rice defends dropping China from rights blacklist

2008-04-02T10:57:00.000+08:00

March 13, 2008
Rice defends dropping China from rights blacklist
WASHINGTON - US Secretary of State Condoleezza Rice on Wednesday defended removing China from the State Department's list of top human rights violators, citing renewed dialogue with Beijing on such issues.
'We just got China to renew or to begin again the human rights dialogue that had been in limbo for some time,' Dr Rice told reporters.
In the State Department's annual report on human rights released on Tuesday, China was dropped from the list of the world's worst human rights abusers, but was classified as an authoritarian country undergoing economic reform and rapid social change that has 'not undertaken democratic political reform.'
'The only purpose here was to call out that there are some countries that are so closed, the Burmas (Myanmars) of the world, that you have a different kind of problem when you have a country that is in many ways completely closed off to the world,' Rice said.
'But it is by no means suggesting that there is not significant emphasis on human right problems in China,' she added, amid rights groups' concerns that the move was linked to Beijing's hosting of the Olympic Games in August.
'If you read the report on China, it is quite harsh, and properly so, about human rights problems in China,' Rice added.
The report stressed that China's 'overall human rights record remained poor' in 2007, citing tightened controls on religious freedom against Buddhists in Tibet and in Muslims in northwestern Xinjiang.
'The government also continued to monitor, harass, detain, arrest, and imprison activists, writers, journalists, and defense lawyers and their families, many of whom were seeking to exercise their rights under the law.'
Although there had been some progress in the legal system 'efforts to reform or abolish the reeducation-through-labour system remained stalled,' it said.
China had been fingered as one of the worst violators in the Department's 2006 and 2005 reports.
This year North Korea and Myanmar were ranked among the world's worst violators of human rights, while the State Department also took other Asian countries to task for alleged abuses.
Mr Christopher Hill, assistant secretary of state for East Asian and Pacific affairs, meanwhile Wednesday credited Vietnam with making great strides in economic and social reforms.
'But in human rights this is clearly a work in progress,' he told a Senate committee hearing, after returning from an Asian trip this month that included talks in Hanoi.
'Social freedoms have increased. But there is no question that serious deficiencies remain in political and civil liberties,' he said, citing a crackdown late last year that netted prominent Vietnamese dissidents.
In his Hanoi meetings, Mr Hill said he pressed Vietnamese officials for the immediate release of the jailed dissidents, including Catholic priest Nguyen Van Ly and a Vietnamese-American, Nguyen Quoc Quan. -- AFP
from The Straits Times

Why anger the dragon

2008-04-02T10:55:00.003+08:00

Source: Newsweek
Source: www.newsweek.com/id/123442
Provided by: Beverly Li

Why Anger The Dragon?
As a vote looms, Taiwan seems ready to abandon an era of defiant nationalism.

Jonathan Adams
NEWSWEEK
Updated: 10:33 AM ET Mar 15, 2008

Ken Wen, 60, is fed up with Taiwan's pro-independence president, Chen Shui-bian. Wen, a home builder, voted for Chen and his Democratic Progressive Party (DPP) back in 2000. In so doing, he helped end the 50-year rule of the Kuomintang, which has traditionally opposed independence from China. But now, after eight years of corruption scandals, cross-strait tensions and poor economic performance, Wen says it's time for another change. At a rally in the port city of Keelung last week, he said he planned to vote for the KMT's Ma Ying-jeou for president on March 22, hoping Ma will boost Taiwan's stagnant economy by strengthening links with China. "If we don't open up more, we're finished," Wen says.

That's a common view in Taiwan these days. In fact, both candidates in the upcoming vote—Ma and his DPP challenger, Frank Hsieh—have promised to open Taiwan's economy to the giant next door and to take a more moderate tone with Beijing. But if the front-runner Ma, who is Hong Kong-born, triumphs over native son Hsieh, the voters' message will be especially clear.

Ordinary Taiwanese will have rejected Chen's confrontational tactics: a victory not just for moderates like Ma, but also for Chinese President Hu Jintao, who's taken a more restrained approach to the island in recent years. And by electing the first mainland-born leader since the end of Taiwan's authoritarian era 20 years ago, locals will also have stepped away from the identity politics that have long divided this island.

As all this suggests, a Ma victory would have far-reaching implications. First, of course, it would cool off one of the world's most dangerous flashpoints, the one place that could actually spark a war between China and the United States. (Beijing views Taiwan as part of its territory and has threatened force if the island makes a permanent break; Washington has pledged to help its democratic ally if attacked).

Since 2000, China and Taiwan have been locked in a vicious circle: Beijing has refused to deal with the island's pro-independence government, and Chen has inflamed tensions by loudly trumpeting the island's sovereignty. But Ma wants to break this cycle with expanded economic links and engagement with Beijing. His pledges include the opening of direct cross-strait flights by May 2009 (travelers currently must touch down in a third location, adding several hours to trips), lifting caps on China-bound investment (helping Taiwan firms better tap the mainland market), allowing more Chinese tourists to visit the island (they're currently limited to 1,000 a day) and opening Taiwan's economy to more Chinese investment. "There's no need to antagonize the dragon," Ma adviser Su Chi put it in an interview in January. His boss has even proposed to restart political talks with Beijing, which have been suspended since 1999.

Oh, and then there's the pandas. Unlike Chen, Ma has said he'd accept China's standing offer of two of the cuddly bears (the pair are currently cooling their paws in Sichuan).

But is Taiwan ready to put a panda-hugger in office? Despite Ma's lead in the polls, he's not yet a shoo-in. Pro-independence sentiment and Taiwan pride remain near record highs; 21 percent of islanders back full independence and 44 percent identify themselves as Taiwanese only, according to recent survey data. As a mainlander, Ma remains vulnerable to attacks on his patriotism; if elected, he'd be first the non-local-born president since the autocrat Chiang Ching-kuo (who was Chiang Kai-Shek's son) died 20 years ago. Some Taiwanese say they still won't vote for a mainlander, and fear a Ma victory could usher in a return to KMT authoritarianism.

The DPP's Hsieh has tried to stoke such fears with negative attacks, portraying Ma as disloyal to Taiwan. But there are signs that the identity card is waning in force. After eight years of misrule by the local-born Chen, many Taiwanese are simply sick of him and his party. Restrictions on cross-strait investment and travel have hindered Taiwanese firms' ability to cash in on China's boom, and Chen's inflammatory moves—such as his recent plan to hold a referendum on rejoining the United Nations under the name "Taiwan" (as opposed to the "Republic of China")—have strained relations with Beijing and Washington to the limit. With incomes stagnant and inflation on the rise, even many DPP supporters are now ready to jump ship. Wang Cheng-kun, the director of the doctors' association in Tainan, a DPP stronghold, recently endorsed Ma, in part because he was put off by what he saw as Hsieh's smear attacks and fearmongering. Wang also says he admires Ma's clean character and more-global outlook. "I've always been a [DPP] supporter, and I was afraid my friends wouldn't forgive me for my change of heart," Wang said. "But Taiwan must internationalize; we shouldn't isolate ourselves."

As well as a victory for Ma, a KMT win would also represent a triumph for China's President Hu. In years past, Beijing repeatedly drove islanders into the independence camp with its fiery rhetoric and ham-handed military threats. But in the past five years, it has adopted a much more nuanced strategy. "Under Hu's leadership, Beijing's approach has become more patient, less inclined to saber-rattling, and more self-restrained," wrote cross-strait security expert Lin Chong-pin in a recent essay. True, China has ratcheted up the threats against Chen and other pro-independence diehards. But it's also launched a charm offensive targeting both the KMT leadership and the DPP's base. One recent carrot: a relaxation of restrictions on Taiwanese doctors—a traditional pillar of DPP support—working on the mainland. And on March 4, Hu repeated his offer for peace talks with Taiwan under the "one China" condition, even offering to meet those who'd backed independence in the past if they moderated their views.

Such overtures appear to be paying off; it's harder for pro-independence politicians like Hsieh to whip up anti-China sentiment while Beijing holds out olive branches. Still, a Ma victory wouldn't end cross-strait tensions entirely. As president, he would have to avoid looking like a sellout to the 77 percent of islanders who still favor some sort of independence from Beijing or the political status quo. "Ma [must] take a slow, gentle pace in improving cross-strait relations," says political analyst Liao Da-chi. "I don't think there will be a dramatic change—each side will be very cautious."

What this means is that Ma is likely to emphasize the strengthening of economic links. A major political breakthrough remains unlikely: Ma himself has said it probably won't occur in his lifetime. At most, Beijing and Taipei will put aside, rather than resolve, the thorny issue of Taiwan's permanent status. So the island will remain in limbo, a territory claimed by China but effectively independent. Yet like it or not, Taiwan's and China's economies are now connected at the hip—giving both sides a strong incentive for warmer relations. In that sense, it's good news that both Ma and Hsieh have pledged to take an open-minded approach to Beijing. Whoever wins, pragmatism has already triumphed.

China says no changes to one-child policy for at least a decade

2008-04-02T10:40:00.001+08:00

March 10, 2008
China says no changes to one-child policy for at least a decade
BEIJING - CHINA won't consider changing its one-child policy for at least another decade, the country's top family planning official said in a published interview on Monday.
Minister Zhang Weiqing of the State Population and Family Planning Commission told the China Daily newspaper that China's one-child rule should be maintained for now.
'Given such a large population base, there would be major fluctuations in population growth if we abandoned the one-child rule now,' he was quoted as saying. 'It would cause serious problems and add extra pressure on social and economic development.
Any change in the policy would only be considered after the end of the country's next birth peak in 10 years, Mr Zhang said. Over the next decade, nearly 200 million people will enter child-bearing years.
'After the new birth peak ends, we may adjust the policy if there is need,' he said.
The policy, launched during the 70s, has prevented an additional 400 million births. China's population currently stands at 1.3 billion, growing 16 to 17 million annually.
Beijing limits most urban couples to one child and rural couples to two to conserve scarce resources. Critics say the policy has led to forced abortions, sterilizations and a dangerously imbalanced sex ratio due to a traditional preference for male heirs.
Mr Zhang's remarks, made on the sidelines of the annual legislative session, was clearly aimed at slapping down reports that the country was considering scrapping its one-child policy.
In recent weeks, several officials have tentatively suggested that an overhaul of the policy may be forthcoming since China has succeeded in slowing down its population growth.
Potential changes have also stemmed from concerns about China's aging population, with those aged 60 or older expected to top 200 million by 2015 and 280 million by 2025, according to government figures.
Mr Zhang stressed that the emerging problems should not be blamed solely on the one-child policy and 'it will be simplistic' to focus on a single approach.
Getting rid of the one-child policy now would create more problems than it would solve, he said. -- AP

Associated Press: Young Chinese abroad launch Internet attacks against Western press over Tibet unrest

2008-04-02T10:38:00.005+08:00

Article 5: Young Chinese abroad launch Internet attacks against Western press over Tibet unrest
The Associated Press. March 30, 2008

BEIJING: Armed with nationalism and the Internet, young Chinese abroad have launched a wave of attacks accusing Western media of bias in reporting on unrest in Tibet and defending Beijing's crackdown. The outpouring of emotion is unprecedented in scale and force. China's rising international status and Beijing's success in portraying the violence as being motivated by Tibetan separatists has emboldened students and others to express views that are unpopular in their host countries, experts said. From YouTube videos to Facebook to Web sites created to criticize news reporting, the message is emphatic: Western media are irresponsible and Tibet will never be independent. "To all you bandwagon jumpers who know nothing about chinese history and to all you bashers, let me give you some solid FACTS why Tibet was, is and always will be a part of China," says the opening statement of a video on YouTube that the site says was viewed nearly 2 million times by Saturday. The protests, led by monks, began peacefully on March 10, the anniversary of a failed 1959 uprising against Chinese rule. They erupted in violence on March 14. The Chinese government says 22 people have died, while Tibetans abroad put the death toll at 140. The unrest has cast a harsh light on China just as it prepares for the Beijing Olympics. Foreign governments have called for restraint and for independent monitors to ensure human rights are respected. "Imagine everyday you open the news and it's all saying bad and biased words towards your motherland: crackdown, killing, burning," Liu Yang, a graduate student in biology at the University of Chicago, said in an e-mail. "I don't understand, they struggle for press freedom and fairness, but why would they lose their conscience now?" she wrote. "Isn't the media independent, instead of being a mouthpiece?" College professors and several students agreed the sentiment wasn't confined to just a few fervent patriots. "Most of my friends here hold similar views," said Kevin He, a doctoral candidate who is president of the Chinese Students and Scholars Association at UCLA. "I have been talking about this issue with people from other organizations across the North America. They pretty much share the same opinions." In China, the news has raised less fuss, due in part to media controls that keep most Chinese from seeing reports aside from the entirely state-controlled press. The fact that Chinese students in the West are unsympathetic to Tibetans should be no surprise, said Barry Sautman, a social scientist at the Hong Kong University of Science and Technology. "The fact that they're living and studying and maybe working in the U.S. or any other part of the West doesn't make them feel they should adopt the prevailing viewpoint, because it doesn't necessarily correspond with what they know about China and the Chinese," he said. One student involved with a pro-Beijing Facebook group said he has struggled to battle misconceptions about his native country. "I do believe I should represent China whenever I can and defend my country ... but it is disheartening sometimes because many people simply do not listen," said Chris Yao, who administers a group called "Tibet WAS, IS, and ALWAYS WILL BE a part of China," inspired by the YouTube video. "Ever got angry from CNN news reports over the Tibet issue?" says a note on the page. "Well, let me tell you, you are not the only one!" The students and Chinese media have offered a handful of examples of what they say is bias among Western journalists. One Web site, http://www.anti-cnn.com, complained that several news outlets showed photos of police in Nepal scuffling with protesters and misidentified the security forces as Chinese. It accused U.S.-based CNN of improperly cropping a photo of Chinese military vehicles on its Web site to remove Tibetan rioters who were pelting the trucks with rocks. CNN insisted it has reported impartially. "CNN refutes all allegations by bloggers that it distorts its coverage of the events in Tibet to portray either side in a more favourable light," the network said in a statement. The photo of military vehicles "was used wholly appropriately," the statement said. It said there should be no confusion because the image was captioned, "Tibetans throw stones at army vehicles on a street in the capital Lhasa."Yao, 22, is a Chinese-born computer engineering student at Canada's Simon Fraser University. He has lived in the United States and Canada since age 10 but says his loyalties lie with China. He plans to return after graduation.

Chay Teng's Commentary:

This article is more about the Western media's/the West's portrayal of China, rather than the Tibet issue. Many times, the West have slammed China on some of its policies. While I may not necessarily agree with China's policies, I have to say that the West may be overly critical and sometimes, even hypocritical. The fact is that culturally and socially, East and West have grown to be quite different. So whatever the West make of China, they should perhaps step back and think about the situations, influences and circumstances that make the government react the way they do and not criticise just because what the Chinese government does does not correspond with what they think is right. After all, just because one party is right does not mean that the other party is wrong. There is more than one way to deal with any issue.

International Herald Tribune: China's leaders rediscover Confucianism

2008-04-02T10:38:00.003+08:00

Article 4: China's leaders rediscover Confucianism
By Daniel A. Bell. International Herald Tribune. Sept 14, 2006

BEIJING: Marxism no longer serves as Chinese society's guiding ideology. But that doesn't mean the end of ideology. Western experts hope liberal democracy will fill the void, but they will have "joined Karl Marx," as the Chinese used to say, before that happens. In China, the moral vacuum is being filled by Christian sects, Falun Gong and extreme forms of nationalism. But the government considers that such alternatives threaten the hard-won peace and stability that underpins China's development, so it has encouraged the revival of Confucianism. Like most ideologies, however, Confucianism can be a double-edged sword. "Confucius said, 'Harmony is something to be cherished,'" President Hu Jintao noted in February 2005. A few months later, he instructed China's party cadres to build a "harmonious society." Echoing Confucian themes, Hu said China should promote such values as honesty and unity, as well as forge a closer relationship between the people and the government. The teaching curriculum for secondary schools now includes teaching of the Confucian classics, and several experimental schools have been set up that focus largely on the classics. Abroad, the government has been promoting Confucianism via branches of the Confucius Institute, a Chinese language and culture center similar to France's Alliance Française and Germany's Goethe Institute. For the government, the promotion of Confucian values has several advantages. Domestically, the affirmation of harmony is meant to reflect the ruling party's concern for all classes. Threatened by rural discontent - according to official figures, there were 87,000 illegal disturbances last year - the government realizes that it needs to do more for those bearing the brunt of China's development. Internationally, the call for peace and harmony is meant to disarm fears about China's rapid rise. How does Confucianism resonate in society at large? At some level, especially regarding family ethics, Confucian values still inform ways of life. Filial piety, for example, is still widely endorsed and practiced: Adult children have a legal obligation to care for their elderly parents. Many intellectuals have turned to Confucianism to make sense of such social practices and to think of ways of dealing with China's current moral and political predicament. But their interpretations of Confucianism often diverge from official ones. Perhaps the most influential contemporary Confucian thinker is Jiang Qing, author of "Political Confucianism," in which he argues that for contemporary China, political Confucianism is more appropriate than Western-style liberal democracy. Jiang could not develop the institutional implications in that book. In a Taiwanese publication, however, he puts forward an interesting proposal for a legislature that includes representatives of Confucian elites, of elites entrusted with the task of cultural continuity, and of the people. In an article widely distributed on the Web, he argues for the establishment of Confucianism as a state religion (as with state religions in Britain and Sweden, other religions would not be prohibited). Intellectuals have also been applying Confucianism to foreign policy. Confucians favor rule by moral example and oppose the use of force to promote morality. Hence, Confucian intellectuals were severely critical of the U.S.-led invasion of Iraq. But here, too, interpretations of Confucianism may diverge from official ones. The idea that Taiwan should be reintegrated into the mainland by being threatened with invasion and bloodshed is far removed from Confucian ideals. Perhaps the biggest challenge to the government is the Confucian emphasis on meritocracy. The Confucian view is that political leaders should be the most talented and public-spirited members of the community, and the process of choosing such leaders should be meritocratic, meaning that there should be equal opportunity for the best to rise the top. Historically, Confucian meritocracy was implemented by means of examinations, and there have been proposals to revive and update Confucian examinations for contemporary China. Again, there is an obvious challenge to the government: Objectively measured performance on an exam, rather than party loyalty, would determine who occupies what government post.If Confucianism shapes China's future, it won't look like Western-style liberal democracy, but neither will it look like the status quo.

Chay Teng's Commentary:

Confucian teachings do promote and encourage meritocracy, in which appointments are bestowed on the best person for it and is not based on nepotism or wealth, etc. However, China's governmental system has been unofficially 'plagued' by patronage and this meant that the most qualified person may not necessarily get the appointment. And it does not help that there are many, many officials who are corrupt. The Chinese government could perhaps use this Confucian teaching to move China to a social democratic system.

2008-04-02T10:33:00.001+08:00

Article 3: Faking it: Piracy poses headache for Olympics
By Hamish McKenzieFor CNN HONG KONG, China (CNN) --

At a stall in a crowded street market in Mong Kok, one of Hong Kong's many busy shopping districts, a vendor with a quick whip of his hands produces from behind a plywood wall a set of Beijing Olympics key rings. They are perfect rubber replicas of the five Olympics mascots: the Fuwas. "Have you been looking for this stuff for long?" he asks the buyer. He asks for good reason: fake Olympics merchandise is becoming increasingly scarce in Hong Kong. Until the end of May, there was more to be had as opportunistic salesmen targeted tourists in an area famous for cheap knock-offs. But then the police swooped in, seizing the illicit goods and effectively freezing the supply, local vendors say. The swoop came as part of a China-wide crackdown against fake Olympics goods and the people who sell them. In raids on markets in Hong Kong districts such as Wan Chai, Yau Ma Tei, and Mong Kok on May 30 and 31, customs officers seized 350 pieces of counterfeit Olympics goods, including key-rings, watches, caps, badges, and stickers, worth about HK$7,000 ($895). The vendors aren't taking it lightly. This is a central government issue. The Hong Kong customs department says it is increasing its vigilance in combating the sale of Olympics-related counterfeit products. "Apart from stepped-up monitoring of the market, Hong Kong Customs has been conducting repeated and intensive raids against such counterfeiting activities," said Edmond Cheng, head of intellectual property investigation operations, in a written statement to CNN.com. "As a result, the situation is firmly under control." Since 2004, Chinese authorities have uncovered more than 1,500 cases of violations involving Beijing Olympic slogans, logos, and other trademarks, according to the English-language newspaper China Daily. In 2004 and 2005, such cases involved fake goods worth 14.8 million yuan ($1.9 million), resulting in fines of 8.38 million yuan ($1.1 million), the newspaper reported. Figures were unavailable for 2006 and the first half of this year. It is not difficult to judge the authenticity of an official piece of Olympics merchandise. The security features on an "anti-counterfeiting label" include a 3mm-wide hologram window bearing the Games emblem; the words "Beijing 2008" visible only under certain lighting; and an embossed design. The message is clear: Olympics merchandise is a no-go zone for counterfeiters. That could be something to do with the money involved. The 2004 Athens Games generated $61.5 million in revenues from the sale of licensed Olympics merchandise, according to a report by the International Olympic Committee. Olympic host cities are entitled to between 10 percent and 15 percent of the royalties, according to a report from the China Daily. The crackdown is indicative of Beijing's "selective enforcement", says Oded Shenkar, a professor at Ohio State University and author of "The Chinese Century." "In a way, it's a reminder that when they want to they can enforce, but sometimes they don't want to," Shenkar says. Piracy benefits China's economy by providing jobs and a cheap way to quickly catch up with modern technology, Shenkar says. "Piracy provides them with a certain advantage, at least for now," he says. "They do realize that at some point they will need to crack down in order to create innovation in the system." This past April the United States filed a formal piracy complaint against China at the World Trade Organization, arguing that China's inadequate protection of intellectual property rights was costing the U.S. dearly and putting consumers around the world at risk. The U.S. Commerce Department estimates piracy and counterfeiting costs that country between $200 billion-$250 billion a year. China is a major culprit, costing the United States an estimated $24 billion through sales of pirated goods, the department says. On April 26, World Intellectual Property Day, cities across China demonstrated the country's commitment to quashing piracy by staging public exhibitions and destroying pirated goods. Yet, says Shenkar, China's government treats intellectual property issues the same as any other issue: they are subject to bargaining. So, if the United States pushes hard for China to take action and there is something to be gained by doing so, the government will make a highly visible concession. For instance, a year after China banned "naked computers" -- new computers without pre-installed operating systems -- Bill Gates announced major Microsoft investment in the country and offered $3 software packages for poor Chinese students. Expect more of the same, says Shenkar. "You're going to see some temporary, high visibility crackdowns." That being said, it would be extremely difficult to crack down on all cases of piracy, says James McGregor, CEO of China research and advisory firm JL McGregor and Company. "China's like piracy on steroids," McGregor says. Tackling the piracy industry -- which likely provides thousands of jobs in retail and manufacturing -- would take enormous political and personal effort. Instead, the government has to pick its shots, says McGregor, and Olympics merchandise is an obvious target. Meanwhile, by targeting violations of Chinese-owned trademarks, the authorities can be seen to be vigilant while protecting China's internal economy. "It's the Olympics. It's international. It's China's coming-out party. It's China's face," McGregor says. "Who wants to put on the Olympics and be looked at as the low-class pirate country that steals everyone else's trademarks?"

CNN Online: Human rights questions remain for China

2008-04-02T10:30:00.002+08:00

Article 2: Human rights questions remain for China
By Niall FraserFor CNN HONG KONG,

China (CNN) -- With a year to go before the 2008 Olympics get under way, questions linger over China's efforts to improve its human rights record. Observers and pressure groups have criticized the efforts of the Chinese government and the International Olympic Committee (IOC) since Beijing won the bid in 2001, rejecting assertions by both that the Games will lead to lasting positive change in the world's most populous nation. After praising Beijing's preparations as "excellent across the board," the IOC official charged with overseeing Beijing's preparations, Hein Verbruggen, sparked further anger from advocacy groups with his recent comments that, "...the way the Games are being used as a platform for groups with political and social agendas is often regrettable.'' The International Federation for Human Rights claimed his remarks will "embolden'' hard-line elements within the Chinese Communist Party to ignore international pressure over human rights promises. But the IOC says, there is a widespread misconception that a list of "human rights promises'' was ever sought by the IOC in the first place. "There were some declarations made by senior Chinese leaders in Beijing who raised the human-rights question proactively and talked about how the Games would be part of the process to help human rights development," says IOC's director of communications Giselle Davies,. "But that was never a [piece of] criteria on which the IOC judged and assessed Beijing's bid. "The IOC decision is not made in a political or social context. It is very much based around what is a coming together at a sporting event and everything for which that can be a catalyst for," Davies adds. And that, she believes, is a force for good. "The IOC fundamentally believes that the world will look back and see the Games as a key moment along a period of change and development for good in China," she says. Meanwhile, Human Rights Watch has sharply criticized Beijing. On Thursday, the organization said China's government has failed to live up to pre-Olympics promises of greater human rights freedoms and has instead clamped down on domestic activists and journalists, according to reports from The Associated Press. "The government seems afraid that its own citizens will embarrass it by speaking out about political and social problems, but China's leaders apparently don't realize authoritarian crackdowns are even more embarrassing," Brad Adams, Asia director of New York-based Human Rights Watch, said in a statement carried by the AP On first glance it would appear Beijing is sensitive to certain international concerns. In June, Chinese officials and the IOC moved quickly to launch an investigation into allegations by the advocacy group Playfair 2008 that four official souvenir makers were using child labor. Earlier that month, Beijing took the landmark step of allowing the mother of a victim of the 1989 Tiananmen Square crackdown to mark the anniversary of his death publicly. But others believe that since 2001 there has been a tightening of controls on political dissent and freedom of speech, as Beijing has sought to contain the social and political fall-out from the country's breakneck economic development. The IOC says, for example, that the Olympic Games has led to improvements in China's labor system in which workers endure long hours in harsh conditions for less than the legal minimum wage. Han Dongfang, the Hong Kong-based labor rights activist for the China Labour Bulletin organization, which monitors workers' rights in China, insists "It's about markets and it's about cheap labor ... Labor rights have become worse over the past few years.'' He says that any real change in China can only come from the inside as a result of pressure from workers and the development of free trade unions and the right to collective bargaining -- and not from international pressure. "The Chinese leadership does not care about international pressure. It is not China who is knocking at the door of the international community looking for favors -- it is the other way around,'' Han says. The IOC says "enormous'' progress has been made in terms of the freedom the news media will have to report on the Olympics, following the 2001 pledge by the secretary general of the Beijing Olympic Bid Committee Wang Wei. "We will give the media complete freedom to report when they come to China," he said at the time. Not so, says veteran China scholar Willy Wo Lap Lam, author of the recently published "Chinese Politics in the Hu Jintao Era." "The police and secret police departments in every city have lists of dissidents and 'dangerous' people who are not supposed to talk to the western media," Lam says. "So, instead of following these Western reporters around, the police will simply post more 'guards' outside the dwellings of 'suspect' people in each city and county. They will ensure they can't talk or work with western journalists.'' Professor Joseph Cheng of Hong Kong's City University agrees with Lam. "China's only concern as far as the Olympics is concerned is to showcase itself to the international community. To this end it will treat foreign journalists and visitors very well - but all the troublemakers will 'disappear'," he says. "Twenty years ago they put trouble-makers under harsh house arrest or worse. Today, they give them a holiday. Either way, they won't be speaking to foreign journalists.'' Lam adds that any pledges Beijing did actually make does not necessarily mean human rights will improve. "The main pledges made by Beijing are clearing up the environment and curbing traffic jams. Both of these are achievable through draconian methods," Lam says. Furthermore, while the world-at-large may be expecting an Olympics-led metamorphosis, the reality is very different, he says. "Beijing will not relax controls over dissidents, NGOs as well as 'agitators' for Tibet or Xinjiang. There will be tighter surveillance of potential troublemakers," Lam says. "The South Korean Olympics in 1988 marked the beginning of genuine political liberalization. For China, it is a very different story. The Chinese Communist Party sees the Games as an opportunity to show the world China's great achievements in the economy and infrastructure and to demonstrate their diplomatic clout. Internally, the Games will help the Party foster 'internal cohesiveness' using national pride to justify the Party's ruling status. "No Chinese Communist Party leader wants to use the Games as a juncture to push forward reforms.''

TIMES Magazine: Postcard China

2008-04-02T10:26:00.004+08:00

TIMES Magazine: Postcard China
Link: http://www.time.com/time/printout/0,8816,1704405,00.html

The west side of Beijing's venerable Workers' Stadium is ground zero for the capital's party animals. Stretching south of the stadium gate is a row of huge dance clubs with names like Babyface, Coco Banana, Cargo and Angel, each competing with its neighbors to be bigger, brighter and louder. But on the other side of the road, the offices and shops are shuttered by late evening. Only one discreet neon sign is visible above a small stairway: Destination — Beijing's premier gay club.
Despite its unassuming exterior, the long lines of young men waiting for entry on most weekend nights are a giveaway. And inside it's all action. On a recent Saturday night, hundreds of men milled around the outer rooms drinking and flirting. Around the tennis-court-sized dance floor an Eminem concert looped on half a dozen video screens, and pulsing lasers and strobe lights flashed over the writhing, sweating bodies. It has been like this every weekend for the past couple of years, the club's manager says.
Xiao Wang, as he is introduced to me, is propped up against a wall in one of the bars. The 29-year-old architect, who sports a stud earring and a fresh razor cut, looks puzzled when I ask him about the drawbacks of being gay in Beijing, and whether he gets hassled by the authorities. "Hassled for what? Being gay?" He laughs. "Why would they want to do that?"
There has never been a better time to be gay in China, but as Destination's somewhat schizophrenic combination of outer reserve and inner exuberance demonstrates, it still pays to be careful. Beijing's attitude has been described as a "Triple no" policy: no approval, no disapproval, no promotion. That sort of "Don't ask, don't tell" system is emblematic of the delicacy with which the communist regime is learning to deal with many of the personal-liberties issues being raised by the country's growing middle class. For their part, homosexuals in China seem perfectly happy to live within the boundaries allowed by the government, albeit not without the occasional snipe at the authorities. It's no coincidence, for example, that the once ubiquitous term tongzhi — comrade — is now slang among young Chinese for gay men.
Historically, Chinese society was relaxed about male homosexuality, which was tolerated so long as it didn't interfere with the Confucian duty to raise a family. Although an imperial decree was issued (likely under the influence of Christian missionaries) banning homosexuality in 1740, it was not until the advent of the communists that gays and lesbians were driven underground. The communist government once viewed gays as disruptive to social order and strictly enforced laws against homosexuality, imprisoning and even executing those convicted. But as China's economy opened to the world, the authorities' stance softened. A law banning sodomy was dropped in 1997, and in 2001 homosexuality was removed from the country's official list of mental illnesses. "It gets freer every year," says Bernie, a fortysomething who takes a longer perspective. "And every year more and more gays come out of the closet. In Beijing and the big cities, you can see couples walking around the shopping malls holding hands. In the smaller cities, I hear it's getting better all the time."
Still, Beijing is no San Francisco. Openly gay filmmaker Cui Zien says it's still easy to cross an invisible line when it comes to publicly celebrating gay culture. "I organized a gay film festival and the authorities warned us not to advertise the location and the date, not even on the Internet." Despite the restrictions, the festival was allowed to go ahead (unlike some in previous years) and was well attended. Also, since the SARS outbreak in 2003, the government has become more enlightened about AIDS. Cui notes that "there are lots of education programs on safe sex and HIV prevention in gay communities and on the Internet, and there is also lots of funding available to safe-sex campaigns."
Back at Destination, Xiao Wang is still struggling to explain how things work. A friend in a leather jacket grabs his shoulder and pulls him toward the dance floor, but he hesitates. "If you do something wrong, of course you can get into trouble. But that's not just for gays. That's true for all Chinese. Other than that," he says, turning to follow his friend, "we're free to live our lives."

Terence Commentary:

From this article, we can see that the Chinese government is more relaxed towards the gay culture in China. The stretch of area that is home to the gay bars is a sign that China is progressing towards a developed country as most developed countries in the world today do have a stretch of area that is home to such bars. The perception of people are also changing and they are starting to accept gays even though there is still a strong stigma against gay. However, the relaxation of the chinese government control meant that the number of people getting infected with sexual diseases will increase at an alarming rate which is not healthy for the chinese society. The mindset of people is changing against homosexuality meant that chinese culture is evolving and that can also be a bad sign as the chinese will let their cultural aspect take a backseat as they focuses more on economic growth. Both the relaxation of control from the government as well as the changing of mindset from the people will bring both positive as well as negative effect to China, I believe that what can be done to minimise the damage is that to re-introduced Confucius concept into the people which the Chinese government is trying to do so. However, I believe that such policy should be concentrated more in the urban areas as people in the rural area are still against the idea of homosexuality or it don't even exist at all.

The new colonialists

2008-04-02T00:40:00.001+08:00

China

The new colonialists

Mar 13th 2008
From The Economist print edition

China's hunger for natural resources is causing more problems at home than abroad

THERE is no exaggerating China's hunger for commodities. The country accounts for about a fifth of the world's population, yet it gobbles up more than half of the world's pork, half of its cement, a third of its steel and over a quarter of its aluminium. It is spending 35 times as much on imports of soya beans and crude oil as it did in 1999, and 23 times as much importing copper—indeed, China has swallowed over four-fifths of the increase in the world's copper supply since 2000.

What is more, China is getting ever hungrier. Although consumption of petrol is falling in America, the oil price is setting new records, because demand from China and other developing economies is still on the rise. The International Energy Agency expects China's imports of oil to triple by 2030. Chinese demand for raw materials of all sorts is growing so fast and creating such a bonanza for farmers, miners and oilmen that phrases such as “bull market” or “cyclical expansion” do not seem to do it justice (see special report). Instead, bankers have coined a new word: supercycle.

Not all observers, however, think that China's unstinting appetite for commodities is super. The most common complaint centres on foreign policy. In its drive to secure reliable supplies of raw materials, it is said, China is coddling dictators, despoiling poor countries and undermining Western efforts to spread democracy and prosperity. America and Europe, the shrillest voices say, are “losing” Africa and Latin America.

This argument ignores the benefits that China's commodities binge brings, not only to poor countries, but also to some rich ones, such as Australia. The economies of Africa and Latin America have never grown so fast. That growth, in turn, is likely to lift more people out of poverty than the West's faltering aid schemes. Moreover, China is not the only country to prop up brutish regimes. Witness the French troops scattered around Africa, some of whom recently delivered a shipment of Libyan arms to Chad's embattled strongman, Idriss Déby.

A new nuance
China could—and should—use its influence to curb the nastiest of its friends, including the governments of Sudan and Myanmar. And it is beginning to do so. It has ceased to resist the deployment of United Nations peacekeepers in Darfur, and is even sending some of its own military engineers to join the force. Wen Jiabao, China's prime minister, has called publicly for democracy in Myanmar—which, even though Chinese officials' understanding of democracy is different to Westerners', is a bold step for a government that claims not to meddle in other countries' internal affairs. The more business China does with the rest of the world, the more nuanced its foreign policy is likely to become.

Still, China's hunger for natural resources is creating plenty of problems. Most of them, though, are in China, not abroad.

China is hoovering up ever more commodities not just because its economy is growing so quickly, but also because that growth is concentrated in industries that use lots of resources. Over the past few years, there has been a marked shift from light manufacturing to heavy industry. So for each unit of output, China now consumes more raw materials.

That may sound like a minor change, but the implications are dramatic. For one thing, it has encouraged the sort of foreign entanglements that are now causing China such embarrassment. More worryingly, it is compounding China's already grim pollution. Heavy industry requires huge amounts of power. Steelmaking, for example, uses 16% of China's power, compared with 10% for all the country's households combined. By far the most common fuel for power generation is coal. So more steel mills and chemical plants mean more acid rain and smog, not to mention global warming.

These are not just inconveniences, but also an enormous drag on society. Each year, they make millions sick, cause hundreds of thousands of premature deaths, sap agricultural yields and so on. Pan Yue, a deputy minister at the government's environmental watchdog, believes that the costs inflicted by pollution each year amount to some 10% of GDP.

No fire without smoke
It is no wonder, then, that pollution is the cause of ever more protests and demonstrations. There were some 60,000 in 2006 alone, by the authorities' own count. Some are led not by impotent peasants but by well-organised burghers from Shanghai and Xiamen, a development that must horrify China's rulers. And the potential for even more disruptive environmental crises is great: northern China is already running out of water, and the glaciers that feed its dwindling rivers are melting, thanks to global warming.

The government is aware of these problems, and is trying to address them (see article). It has used this month's People's Congress to raise the status of Mr Pan's agency to a ministry. It has increased fines for pollution, reduced subsidies on fuels and scrapped tax breaks for heavy industry. It is also promoting cleaner sources of power, such as windmills and natural gas. Yet despite frantic efforts to clean up Beijing in time for the Olympics in August, athletes still doubt the air will be fit to breathe. The world's fastest marathon runner, for one, has threatened to drop out of that race because of pollution.

All the government's green schemes are being undermined by an artificial abundance of cheap capital, and by bureaucrats' enthusiasm for channelling it to grubby industries. Chinese banks, with the government's blessing, pay negative real interest on deposits and so can lend to state-owned firms very cheaply. Many of those firms also benefit from free land and pay negligible dividends to the state, leaving lots of money to invest in more dirty factories. Chinese depositors and taxpayers are subsidising the very industries that are slowly poisoning them.

China is bound to consume enormous amounts of raw materials as it develops. But given how polluted the country already is, and how much unrest that pollution is causing, it should curb its hunger for resources. A less wasteful development strategy would be a healthier one.

Industry in China

2008-04-02T00:39:00.003+08:00

BUSINESS

Industry in China

Where is everybody?

Mar 13th 2008 GUANGZHOU
From The Economist print edition

Manufacturers struggle in southern China's industrial belt

AT FIRST, the managers of the factories spread throughout Guangdong province thought the lack of returning workers after the Chinese New Year break in early February was merely because they had been delayed by the huge blizzard that disrupted rail and power lines, and left roads impassable. But now that the mess has now been cleaned up, it is clear that the vast annual migration of around 20m people that has fuelled the manufacturing boom in southern China over the past two decades is beginning to diminish.

The Guangdong Labour Ministry reckons 11% of the workers did not return after the holiday; other estimates are as high as 30%. Whatever the precise number, many factories are reeling. Wages were already rising; now they will surely go up further, adding to surging costs for credit, materials, energy, environmental compliance and health care. Meanwhile, revenues are falling due to slowing demand from America and a reduction, following pressure from other countries, in China's complex system of export subsidies.

A survey of conditions in southern China conducted in the aftermath of the Chinese New Year, covering 162 members of the Federation of Hong Kong Industries, produced reams of gloomy figures. Members estimated 10-20% of the 70,000 factories in Guangdong province had closed in the past year, and expected a similar number to close within the next two years. Two-thirds of those polled said they were unsure whether to invest more in the region; one-third planned to cut investment. Only one respondent was optimistic.

To some extent the upheaval in southern China follows a government plan to force dirty, low-paying industries out of business or into poorer interior regions that have so far missed out on the country's growing industrial wealth. The hope is that the gaps in Guangdong will be filled by factories producing more sophisticated, high-value products that are cleaner and less energy-intensive to produce. There are signs that this is indeed happening.

Factories are opening up in China's interior, providing opportunities for those in rural areas to find employment closer to home, rather than having to leave their families for an entire year. This may explain the reduced flow of migrant workers. At the same time, discriminating industrial parks are popping up in Guangdong and Suzhou, among other places, that will only permit factories producing sophisticated electronics and medical equipment. The factories in deepest trouble are said to be in low-cost, low-skill areas: toys, plastics, shoes, clothing and so on. Many are sweatshops with poor working conditions.

Firms that provide relatively high wages and good working conditions do not seem to have problems attracting employees. Nike's sneaker factory in Dongguang, one of the grimier sections of Guangdong, has 27,000 workers, including 4,500 that have returned over the past year and 40% who have been around for at least three years. The workers receive 1,400 yuan a month ($200), well above the minimum wage, receive subsidised food and (for the 7,500 living inside the factory) clean dormitories. Nike is not competing for the low end of the market: shoes produced its is Dongguang factory can cost as much as $185 a pair.

But Nike has been steadily spreading manufacturing from southern China to the rest of the country, and the rest of South-East Asia. Indeed, the idea of shifting away from China seems to be gaining adherents. A study by Booz Allen Hamilton, a consultancy, on behalf of the American Chamber of Commerce in Shanghai, says more than half of foreign firms believe China is losing its edge over other low-cost Asia countries, and 17% intend to relocate.

This shift will be a good thing, as production shifts to Bangladesh, Indonesia, Malaysia and even Africa, spreading wealth and deepening manufacturing skills. Whereas China was once desperate to grow through exports, it is now developing its own domestic economy and has other ways to thrive beyond merely producing cheap goods. But these shifts are at the very least disruptive. Hundreds of thousands, if not millions, of unskilled workers still depend on southern China's low-cost factories for their livelihoods.

And as the rusted hulks of manufacturing plants throughout the Western world attest, the transition to higher-value products can be difficult. Clement Chen, the chairman of the Federation of Hong Kong Industries, says the Chinese government is understandably clamping down on lots of dirty industries—leather tanning, dyeing, finishing, electroplating, and the like—but that this can disrupt the broader manufacturing supply chain, including industries China wants to develop. Business environments, like ecosystems, can be fragile—and once lost, competitive advantage can be hard, if not impossible, to regain.

Comments:
I feel the shift of many low cost industries in China to regions like Bangladesh will only serves to exacerbate the problem of rural urban divide in China. More middle income citizens in China will sink into poverty, increasing the government’s burden. Such problems are also capable of sparking of more “mass incidents” in China. However, one positive sight would be the shift of industries to the inner regions in China as they can effectively help to ameliorate the poverty problem in those regions.

Health care in China

2008-04-02T00:37:00.003+08:00

Health care in China

Losing patients

Feb 21st 2008 BEIJING
From The Economist print edition

An orthodox approach to fixing the unavailability of decent health care

STARTLING economic growth in China has not been matched by similar improvements in health care. The cost of treatment is becoming ever more prohibitive for the poor. Government spending is meagre. But nearly three years after declaring the system a failure, officials are at last getting ready to unveil a plan to fix it.

Some Chinese press reports say the long-awaited and much-debated reform plan is likely to be revealed at the annual session of China's parliament, which opens on March 5th. The outline is already clear: a stronger role for government, including more money from the central budget, and a drive towards universal health insurance. Changes are already in train.

The reforms reverse the market-driven policies of much of the past two decades. The outbreak in 2003 of SARS, an often fatal respiratory disease, made the government realise what a mess the health-care system had become. Government hospitals and clinics, starved of funding, had turned to raising money (and boosting ill-paid doctors' salaries) by prescribing ever more expensive treatment and diagnostic procedures. With the collapse and privatisation of state-owned enterprises, the vast majority of citizens had been left with no insurance. Many began avoiding even desperately needed treatment.

In 2003 the government introduced a new medical-insurance scheme in the countryside. This involves contributions from rural residents as well as local governments and, for the first time, the central government. The number of people taking part rose from 80m that year to more than 730m now. This month Wu Yi, a deputy prime minister, said all rural residents (about 800m is the usual official figure) should be insured by the end of this year.

The scheme is only a slight relief, if at all, for the poor. It often does not cover routine outpatient treatment. The average reimbursement rate is only 30-40%, and bills have to be paid in full first. So hospital stays are beyond the means of many. There is also a big loophole: those insured can get benefits only in their own localities. Many younger people from the countryside are working in cities where they have to pay all of their treatment costs. A new labour-contract law introduced this year requires employers to pay medical insurance for such workers. But migrants are often hired informally, making it easy for employers to evade such requirements.

Even though urban health care receives a disproportionate share of total government spending on health, many urban residents fare just as badly. Li Ling of Peking University estimates that more than half of the urban population has no insurance. Those who do are mostly civil servants and the staff of state-owned enterprises. At least until the labour-contract law was enacted, many private enterprises provided nothing. Last year the government introduced an urban insurance scheme (similar to the rural one) aimed at non-working residents, including children and university students. The aim is to have every urban citizen covered by 2010.

Much detail, however, is still unclear. A big issue is how to wean hospitals off their dependence on revenue from user payments. Policymakers and academics have been furiously debating whether the emphasis should be on government subsidies for hospitals or on reimbursements for patients. No target has yet been set for the maximum share of health expenditure to come from patients' own pockets. Ms Li, who has been advising the government on health reform, suggests a goal of 20% compared with over 50% at present.

Unlike for education, Chinese officials have also yet to set any specific targets for government spending as a percentage of GDP. The government spends a mere 0.8% of GDP on health (it was more than 1% in the 1980s). Henk Bekedam of the World Health Organisation says it could easily afford around 2.5%. But the government is being cautious. Reform, said Ms Wu last month, would be complicated. “Patience is needed,” she said. Patients would say they have shown more than enough already

Comments:
Despite the efforts to improve the health care situation in the rural areas, there are no specific targets for government spending as a percentage of GDP. Also, given the large number of people in these rural regions who requires such services, the amount of money involved is going to amount to a very huge sum of money. With rampant corruption at the grassroots level, the situation is not very promising.Furthermore, this problem has been going on since the reform era. The injustice that the rural chinese suffered from may eventually result in serious social upheavals similar to that of the TianAnMen incident in 1989. The problem is worsening and i feel that immediate action and concrete steps should be taken to address the issue before it starts to go out of hand.

Clarification!

2008-04-02T00:29:00.004+08:00

Clarification!

It appears to me that my template is a little unclear... I must apologize for any confusion...

As mentioned earlier, the font size for your article and comments should be "normal" size.

Also, the font for the article and comments should also be Georgia/default fonts and not bolded or italicised.

The article's name and the title of your comments on your own article (like Shi Rong's Analysis for example) are exempted from such ruling though.

Anything in the square brackets should not be followed exactly... Eg. if my article is about corruption, my labels are NOT CSE Theme and CSE Topic; they should be Social and Corruption respectively.

Hope that should clear up any confusion... Have fun!

Chinese Inflation

2008-04-01T23:58:00.003+08:00

Chinese inflation

Sweet and sour pork

Mar 13th 2008
From The Economist print edition

Are rising prices in China driven by the supply of meat or money?

IN A country where bouts of inflation have triggered social unrest, the jump in China's inflation rate to a 12-year high of 8.7% in February is cause for concern. But economists are sharply divided on the cause of this inflation and the degree to which policy needs to be tightened.

The People's Bank of China (PBOC) is expected soon to lift interest rates and banks' reserve requirements once again. Some people fear a repeat of 1987-88 or 1993-94 when high inflation forced the government to tighten monetary policy sharply, causing a hard economic landing.

One difference between today and previous surges in inflation is that the increase over the past year has been caused mainly by food prices, which jumped by 23%. Vegetable prices are 46% higher than a year ago, pork is 63% dearer. The impact of various supply shocks, notably blue-ear disease which killed thousands of pigs, were aggravated last month by the worst snowstorms for 50 years, damaging crops and disrupting transport. Non-food prices rose by only 1.6% over the past year. In 1994, by contrast, non-food inflation hit 20%.

To the extent that food prices have been pushed up by one-off supply factors, they should flatten later this year, causing inflation to fall. If so, it is argued, there is no need to slam on the brakes. Moreover, higher interest rates would do little to curb food prices. Some policy makers also worry that if China raised interest rates sharply at the same time as America is cutting them, this would attract bigger capital inflows and the extra liquidity could actually worsen inflationary pressures.

Indeed, some economists believe that excess money is already partly to blame for rising inflation. In the past there has been a tight correlation between China's inflation and money-supply growth. Monetary growth surged before both bouts of inflation in 1987-88 and 1993-94. In 1993 the annual rate of growth of the M2 measure of money hit 40%.

Today it is less clear that the money supply is out of control. Over the past year M2 rose by 17.5%, not much faster than the average during 1998-2003 when prices were flat or falling. But Hong Liang, an economist at Goldman Sachs, reckons that the M2 measure of money understates the amount of liquidity sloshing around in China. She prefers M3, a broader measure, which includes deposits in non-bank financial institutions and securities issued by financial institutions. According to her calculations, M3 growth has risen sharply since 2005, from around 15% to 23%. This suggests that higher inflation could prove to be more persistent and spread from food to other goods and services, requiring the PBOC to tighten by much more.

But another difference between today and previous bouts of inflation is that in the past rising inflation went hand-in-hand with a widening current-account deficit—a classic symptom of overheating. Today China has a huge surplus. This offers another tool to fight inflation: a more rapid appreciation in the yuan alongside a modest interest-rate rise could curb imported inflation and cause less harm to domestic demand. Indeed, this is something that most economists can agree on: regardless of what is driving inflation up, a stronger yuan would help to pull it down.

Playing with the old blood rules Source: http://www.newsweek.com/id/120100

2008-04-01T23:24:00.008+08:00

Playing with the old blood rules
With the death of filial piety and the rise of 'kids for hire,' no Chinese family value is sacred anymore.
Melinda Liu
NEWSWEEK
Updated: 12:45 PM ET Mar 8, 2008

China's one-child policy is broken. After years of public grumbling, international scandals over forced sterilization and government tinkering, that's a truth of which most Chinese are aware. So when a senior official announced two weeks ago that Beijing was considering scrapping the policy, it didn't come as a complete surprise. Speaking at a press briefing in Beijing, Zhao Baige, vice minister of China's National Population and Family Planning Commission, cautioned that she couldn't say exactly what changes the government would make, or when. But she did make one thing clear: that Beijing knows the policy doesn't work any longer, and it needs to be rethought. "This has become a big issue among [China's] decision makers," she explained.

It's no wonder. After almost 30 years in force, China's unpopular one-child rule—though it was never as strict as usually portrayed—has distorted the population in a manner that threatens China's future. Coupled with the tumultuous impact of rising wealth, the policy has reshaped families in a number of unintended ways. It has limited the number of children available to care for parents in a rapidly aging society in which the state provides few services. The one-child rule also has turned China's traditional bias for sons into a motivation to screen out girls, yielding a population heavily overweight with men. Beijing knows full well these trends won't produce the "harmonious society" that is its official goal, and so it has begun tweaking its policies anew. But tweaks may not be enough.

The most pressing problem is a breakdown of filial piety, the sense of loyalty and shame that drove generations past to protect their elders no matter the cost. Chinese experts say the nation of only-children is increasingly self-centered, more and more inclined to abandon old obligations. Drawn to the booming big cities, many young people are also throwing themselves into the newly rich urban lifestyle (and helping to save for retirement) by opting to have no children themselves.

Those left behind are being forced to adapt. Most strikingly, many Chinese parents are now even reconsidering their long-held prejudice for sons, on the new assumption that daughters are more likely to grow into loyal caregivers. In a striking recent online survey, a thin majority of Chinese said they would now rather have girls than boys. Aged Chinese, meanwhile, are scrambling to find new ways to care for themselves, including private insurance programs and more-bizarre measures like "kid for hire" systems.

The government is seeking creative solutions of its own. Recognizing that the breakdown in filial piety is likely irreversible, it is moving to create a nationwide system of home care for the elderly—in part because it's still considered shameful to send mom or dad to a nursing home. Of course, the simplest fix would be to free people to have more kids, and in some cities, officials are doing just that. But since the 1980s, when the state routinely conducted forced sterilizations, Chinese authorities have largely lost the will and capacity to enforce family-planning policies. Beijing is also still fearful of setting off an uncontrolled population boom. Thus no sooner had Zhao said the one-child policy was being reconsidered than Prime Minister Wen Jiabao tried to squelch the news, insisting no change was in store. "We will adhere to the current policy of family planning [and] keep the birthrate low," he told the National People's Congress last week.

But the changes underway are too big to contain. The problem of a rapidly aging population is common to prospering nations worldwide—but it's made more complicated in China by the impact of its family-planning policies. As China has developed, life expectancy has shot upward, from younger than 50 in 1949 to older than 72 today. The elderly (over 60) share of the population has grown, from 10 percent in 2000 to 11.3 percent in 2006. Though China's Constitution says children must support their parents, many now neglect them. That's partly because the offspring of one-child families are "more likely to be spoiled and self-centered," says Cai Feng, a demographer. But the result is that, as of 2005, 42 percent of Chinese families consisted of an old couple living alone, according to government statistics. In some cities, that figure is now more than 56 percent—comparable to the United States, where aid and the elder-care infrastructure are more comprehensive.

For centuries, a healthy Chinese brood dominated by male children was considered the best form of social security. It still is in many rural areas, where boys can work the fields alongside their parents and won't transfer their earning potential to their in-laws after they marry. After the one-child policy was implemented in 1979, such sentiments led many Chinese parents to do whatever they could (including resorting to female infanticide and selective abortions) to make sure they had boys. As a result, the male-to-female birth ratio in China today is about 1.18 to 1, as opposed to the standard ratio of 1.03–1.07 to 1.

In China's modernizing cities, however, many young couples now recognize that daughters are better caregivers. "Girls are more thoughtful," says Feng Xiaotian, a sociologist at Nanjing University. Not for nothing are girls known in Chinese slang as tie sheng xiao mian ao, or "a thin padded jacket," owing to their perceived ability to provide parents convenience and warmth. As a result, an online survey conducted by the China Youth Daily in early 2007 among 2,603 people from 29 provinces and cities found that more respondents would now choose to have a daughter (29 percent) than a son (28.4 percent). This change hasn't shown up in national birth statistics yet, and the sample set wasn't entirely representative (since Chinese who participate in Web surveys tend to be more liberal and well educated than average). But the numbers represent a stunning shift all the same.

Many Chinese who are too old to bear daughters of their own, meanwhile, are finding other ways to acquire them. Adopting adult children—which was common in feudal times—is becoming prevalent, says Nanjing University's Feng. Take Wu Shaoqiu and his wife, a retired couple living in the central city of Wuhan. After their kids immigrated to the West, they decided they needed "someone to stay and talk" with them, says Wu, 75. So in 2006, he attended a meeting, cosponsored by the city government and a local newspaper, where lonely elderly couples were introduced to prospective adult "daughters." There he met Fang Fang, an executive, whom he brought home to meet his wife. "She brought flowers [and] called me 'Papa' and my wife 'Mummy'," Wu says. Fang Fang soon joined the family—as did two other women she brought along. On weekends and holidays, all three women, who are in their 40s and married, now visit the couple to cook and clean, and maybe play cards or surf the Web. '

Wu and his wife never offered any financial compensation to the women; he says they're happy to act as surrogate children "for the good of society." But in other cases, the terms are more explicit. Tian Zhendong, a retired construction expert, also in Wuhan, says he and his wife felt "lonely and lost" after his son moved to Canada. So he published an ad titled "Elderly couple desperately seeking daughter," promising successful applicants would inherit the couple's apartment. To his surprise, 100 people applied, though the couple abandoned the talent search after their son objected.

Attacking things from the other side, the Chinese government has been trying to quietly liberalize the one-child regime for decades. Since the policy's introduction, rural families, who make up more than 60 percent of the population, have been allowed to have a second child if their first was a girl, and ethnic minorities have been allowed to have two or more kids. And since 2000, provincial governments have allowed only-children who married other only-children a second child as well, to prevent what's known as the "8-4-2-1" syndrome, where a single couple has to support four parents and eight grandparents. Authorities in wealthy cities such as Guangzhou and Beijing have begun publicly urging only-children couples to take advantage of this exception.

Yet finding takers is proving complicated. Many young Chinese urbanites, like yuppies everywhere, don't want more than one kid; some don't want any. A Beijing survey late last year revealed that 52 percent of adult single children didn't want to have more than one child, and more than a quarter said they preferred the DINK lifestyle: double income, no kids. That's a big problem for a city with an estimated 2 million only-child adults.

The answer, says Hou Yafei, an expert of the Beijing institute that conducted the survey, is for the government to make it clearer that only-children couples can now have two kids without incurring the draconian fines of the past. But financial problems will linger. Many of the survey respondents explained their aversion to larger families by pointing to economics. Fang Meiqin, 30, a telecom analyst who is expecting a baby in about four months, spoke for many of her generation when she recounted with horror media reports that said that raising a child through college could cost about $422,000. Fang, a Beijing resident, laid out just how expensive it is to bring up baby these days. She figured she would have to budget $1,400 for annual living expenses, $8,440 to $14,000 for primary education and $7,035 for six years of middle school. Tutoring would cost extra.

Beijing could help defray these costs. But it has its own reasons to be cautious. The stop-and-go course of family-planning reform reflects lingering fears of instability in a population already 1.3 billion strong. Many officials still remember what happened in 1983, when public discussions of changes in family-planning regulations led to a reported 30 million extra births that year and the following one. With the population now growing by 8 million to 10 million annually, Beijing is determined to retain some control lest its hard-won economic gains be undone by a rampant population boom.

The less troublesome fix is to offer parents new aid to support them in old age, rather than new incentives to have kids. One key reason the one-child policy is so contentious in the first place is that China lacks an adequate social safety net—an abiding irony in a supposedly communist country. To address this gap, last year authorities introduced a social-security scheme for farmers and a new program of rural medical cooperatives. Residents who choose to participate in the medical cooperative program now pay 10 yuan (about $1.50) annually for access to local clinics and partially subsidized hospital stays. "In the past, when a farmer was ill or needed an operation, the whole family would go bankrupt," says Prof. Wu Changping, a prominent expert on population and aging at Renmin University.

Caring for the elderly remains a huge challenge. Less than 1.2 percent of China's retirees have access to nursing homes, compared to 8 percent in developed countries. And packing parents off to a nursing home is still seen as shameful. The government also lacks adequate facilities, funding and staff. China required 1.8 million nurses to care for its elderly in 2006, and that figure is slated to mushroom to 6.5 million by 2020, according to the China National Committee on Aging (CNCA).

As an alternative, Beijing is now trying to promote home-care services for the elderly. In late February, CNCA unveiled plans to complete by 2010 a nationwide home-care system that would offer things like house calls by health professionals, meals-on-wheels and volunteers who help with household chores. Of course, nothing beats having your kids around to do the job. But until China finally resolves to scrap its dysfunctional birth-control policies, that's unlikely to be an option.

Comments:

Reading the article questions the need for the Chinese government to implement the one child policy in the first place. The increasing preference to have only one child and the increasing number of DINKs (dual income no kids) in china might actually suggest that the one child policy is unnecessary. The birth rates will eventually fall as the Chinese society westernized, as money making becomes a priority (with the introduction of the reform era) and as the cost of living increases. The one child policy was deemed as redundant, as china now faces an ageing population just like the developed countries, but unlike them, China has limited resources.

2008-04-01T22:19:00.004+08:00

An Administrative Note...

I saw the posts and I am pretty amazed by them! Keep them up and running! =)

However, several users including me are becoming aware of the navigation and formatting issues in this blog and hence, I have decided to set a common template so that all of us can follow, as seen in this picture...

http://img502.imageshack.us/my.php?image=blogtemplateoe0.jpg

Notes:

[Publication] refers to the article's origins eg. TIMES, Straits Times etc.

[Link] is the link to the article online. Use the hyperlink tool if needed.

[Article] is the part where the article comes in.

[CSE Theme] refers to the following few: Economy, Social, Political, International Relations, Others. If neccessary, use more than one of such labels.

[CSE Topic] refers to the subtopics under each theme. For example, Taoism and Corruption come under Social while Environmental Issues come under Political. If neccessary, use more than one of such labels.

EDIT: Do also note that the font size for your article and comments should be "normal" size.

On my side, I will try to improve the navigation system to my best abilities. Hope to see you all soon!

EDIT: Everyone, please modify your posts and labels to suit this template so that I can start work on the second update for this blog! Thanks!

China: US exaggerating Taiwan Threat

2008-04-01T22:07:00.004+08:00

Title: China claims that US is exaggerating Taiwan Threat
Source: http://www.time.com/time/world/article/0,8599,1719894,00.html
Date: 6th March 2008

(BEIJING)—The U.S. military is exaggerating China's threat against Taiwan to justify arms sales to the island, the Communist Party's main newspaper said Thursday.

A recent U.S. Defense Department report also overstated China's space weapons and cyberwarfare capabilities and glossed over the People's Liberation Army's steps toward greater transparency, the paper said in a signed editorial.

The report "further propagandizes the 'China military threat theory," it said.
The editorial comes days after China announced a 17.6 percent increase in military spending — the 18th double-digit percentage rise in 19 years — and follows harsh comments by Chinese leaders warning of retaliation if self-governing Taiwan pursues moves to shore up its de facto independent status.

Increased spending has helped the PLA — the world's largest standing army with 2.3 million members — add billions of dollars worth of high-tech missiles, warplanes, submarines and fighting ships

Despite its standing threat to attack Taiwan, the editorial called U.S. warnings of a growing gap in military capabilities a "hackneyed phrase" that appeared each year in the Pentagon report.

"The main purpose is to manufacture an excuse to continue to sell weapons to Taiwan," the report said.

While Washington switched formal diplomatic relations from Taipei to Beijing in 1979, it remains legally obligated to help ensure Taiwan's security and is far and away the island's largest seller of military hardware.

The editorial blasted the U.S. for rejecting a joint Russian-Chinese anti-space weapons initiative submitted last month, while launching a missile to blow up its own defunct spy satellite.

Washington called the proposal biased and unfair and has repeatedly asked Beijing for information on its own successful test of an anti-satellite weapon last year.

The report said the PLA had boosted transparency by issuing annual reports on its overall status, publicizing spending and engaging in joint drills with more than 20 nations. It pointed also to Beijing's constructive role in hosting talks on dismantling North Korea's nuclear capability and dispatch of engineering troops to Sudan's troubled Darfur region.

"You can see China's important role in stabilizing the regional situation in maintaining world peace," the editorial said.

"In reality, some people in America need to overcome their 'amnesia,'" it said.

China says its armed forces are for defensive purposes only.

Yet, the editorial did not flatly deny attempts to build space weapons and attack electronic information systems as government spokesmen previously have.

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Better to have a pet than a child

2008-04-01T20:59:00.008+08:00

Title: Better to have a pet than a child
Labels: Chinese Culture
Source: http://www.straitstimes.com/Saturday%2BSpecial%2BReport/Story/STIStory_211911.html
Date: 1st March 2008

For upwardly mobile couples, it's a guilt- free alternative that suits their lifestyle

By Sim Chi Yin & Susan Long

THEIR FURRY 'CHILD': A Chinese couple enjoying a meal with their dog at a pet restaurant in Hangzhou.
Many young couples in major Chinese cities are opting for a Dink (Double Income, No Kids) lifestyle, citing economic pressures as a factor.

For them, having pets instead of children is a pragmatic move in a dog-eat-dog world where it is an advantage to travel light and have as few family burdens as possible.

TWO years ago, Ms Tian Fang and Mr Li Zhen returned home cradling their bundle of joy - a miniature Schnauzer they named QQ.
They bought it at a dog show for 1,500 RMB (S$290) and spend 500 RMB on its food, toys and toiletries every month.
'We don't spend that much time with him, so we try to make it up by giving him better food, toiletries, toys. We get a lot of joy out of petting and stroking him, just like a child,' says Ms Tian, who works in the finance sector.

Every night when she gets home around 7pm, QQ is waiting by the door. 'If I get home late, he shreds the newspapers and pees and messes up the house to show his unhappiness,' she says indulgently.

She and her restaurant manager husband, both 35, have been married for five years and earn a comfortable 7,000 RMB a month altogether.

Children were never part of their gameplan.
'We are both so busy at work. Life's pressures are so great. With QQ, we have no guilt. We just give him toys and spend some time with him after work and it's OK. We reward his good behaviour with chicken strips or lamb's leg. When he's naughty, we hit his nose with rolled-up newspaper,' says the university-educated fourth daughter of an engineer.

'To have kids just for joy in life, or just to pass on the family name, is too simplistic and too traditional thinking,' she scoffs.
She typifies the new ambivalence towards parenting among the young in major Chinese cities like Tianjin, Beijing and Shanghai, where the Total Fertility Rate (TFR) has dipped to 1.0, among the lowest in the world today.

A TFR of 2.1 is needed to replenish a population.
Experts say this could be a sobering harbinger of fertility trends to come, as more flock to the cities, where increasing educational opportunities and rising incomes provide attractive alternatives to marriage and child-rearing.
Within the next two decades, the proportion of city dwellers, who now make up 44 per cent of China's population, will rise to 60 per cent, according to United Nations projections, likely causing a further overall plummeting of the TFR.

Already, demographers note that the number of women of child-bearing age throughout China is flat and will soon fall.
While the government earlier made it illegal for men below age 22 and women younger than 20 to marry in a bid to curb population growth, the average age at which most Chinese are getting wed is now way above that.
The country's two richest cities, Beijing and Shanghai, take pole position, with men marrying at 28.2 and 31.1 and women at 26.1 and 28.4 respectively in 2006, according to recently released figures.
In 2005, singles accounted for 65.9 per cent of those aged from 15 to 29 and 45.7 per cent of those from 15 to 35. In 1995, the figures were 51.54 per cent and 38.23 per cent respectively.

As a result, the Chinese family has shrunk over the past 50 years, from 5.3 members per household in 1949 to 3.1 in 2005.

Experts say that rapid economic development, a furious living pace and more dual-income couples are fast eroding the propensity to procreate. More are comfortable with cohabitation. The to-do list before getting hitched also keeps growing longer.
Events manager Zhao Guofu, 29, who plans to wed his girlfriend of two years next year, says: 'Marriage is not as simple as it was for my parents' generation. Our society has become hyper-competitive and consumeristic. We feel we need to sort out career, house and car before, not after, we settle down.'

More worryingly, many can no longer count beyond one child, either because the one-child policy syncs with hectic urban lifestyles or propaganda over time has moderated their family size aspirations.

As such, wealthy cities like Guangzhou are actively encouraging families with one child to have a second, in hopes of slowing down the greying process.
In addition, almost all provinces, municipalities and autonomous regions in China now allow couples, where both - or increasingly just one - spouses are an only child, to have two offspring to spread out the burden of supporting the elderly.
However, many among the grown-up single-child generation are saying 'Thanks but no thanks' to current provisions for them to have a second child.

One is enough for more than half of Beijing's adult singletons, according to a recently released survey by the Beijing Administrative Institute. Only 24 per cent intended to exercise their entitlement to have a second child.
Over a quarter opted for a Dink (Double Income, No Kids) lifestyle, citing economic pressures as a factor.

Teacher Liao Lan, 30, who has been married to magazine editor Li Haibo, 31, for three years, says she can't find the time or any convincing reason to have even one child.
To her and many other young urbanites, it is just a pragmatic calculation in a dog-eat-dog world to travel light, have as few family burdens as possible, invest in herself, enhance her education, training and employability, and guard her leisure time.
As QQ's owner Ms Tian put it: 'After all, when I grow old, there's no difference whether we have children or not. We'll be left to our own devices anyway. We'll get a nanny or go to an old folk's home - the conditions are pretty good these days.
'If it's about having joy in your life, then it's better to have a pet.'

----------------------------------------------------------------

Comments: This article shows the changing mindsets of the Chinese, mainly those in the more developed (urban) areas like Beijing and Shanghai. They no longer have to worry about not being able to carry on the family line (having a son etc) and do not see it as an important task on their agenda anymore. China will also face an ageing population soon, with the government planning to keep the One Child Policy, at least for the next ten years.
Change might be due to Western Influence, people getting more educated and money is seen as the more pragmatic thing to go after etc etc.

- Ng Yim Chew

2008-04-01T20:59:00.003+08:00

China's Curious Olympic Terror Threat
Monday, Mar. 10, 2008
By Simon Elegant/Beijing

Taken from:
http://www.time.com/time/printout/0,8816,1720909,00.html

The dramatic news came in the midst of China's staid and boring annual legislature: a terrorist hijacking plot, perhaps meant to mar the coming Olympic Games, had been stopped. Security forces had thwarted a plot to "create an air disaster," Nur Bekri, chairman of the Xinjiang regional government, told reporters at the ongoing session of the National People's Congress (NPC). Apparently, on Mar. 7, a hijacking attempt by separatists from the Muslim-majority province of Xinjiang had been foiled. Initial reports stated that China Southern flight CZ6901 had made an emergency landing in the northwestern city of Lanzhou at about 12:40 p.m. after an apparent attempt to blow up the aircraft. The plane was en route from the Xinjiang capital Urumqi for Beijing.
The news however has been met with considerable skepticism outside China, particularly since details of the incident remain confusingly murky. According to the English-language China Daily, Bekri declined to give more details, only saying that the authorities are investigating "who the attackers are, where they are from and what their background is... But we can be sure that this was a case intending to create an air crash." Some details began to emerge later of between two and four hijackers, possibly carrying gasoline. But concrete information remained elusive.
Russell Leigh Moses, a China analyst based in Beijing, says that affair clearly provided the authorities with an opportunity to reiterate that the rulers of the People's Republic would brook no resistance to their will in troubled areas like Xinjiang and Tibet. It parallels a growing security crackdown on public interest lawyers, activists and other dissenting voices. Says Moses: "It's not what a lot of people outside China expected from the Games. I think there has been a conscious decision at the highest levels of the party that showing some teeth for deterrence sake is much more domestically viable than marching off into the unknown of reform and relaxation."
The paucity of details and the apparent laxness with which Chinese security officials treated the hijacking incident were particularly curious to Steven Tsang, a China specialist at St. Anthony's College, Oxford University. He noted that among the numerous anomalies in the accounts of the incident, the most glaring was that after stopping in Lanzhou, the airplane had apparently been allowed to continue its scheduled flight to Beijing. "This is more like an air rage incident in which you land and get rid of the troublesome passengers and then continue on to your destination. There's no way any anti-terrorism police would have released the plane and passengers to fly on without extensive interviews of the passengers, forensic examination of the plane and so on." Tsang also noted that it was particularly easy to blame a shadowy Islamic separatists movement in the build-up to the Beijing Olympics, possibly as a deterrent to those or any other groups who might want to disrupt the Games.
Some observers also wondered at the timing of the announcement — coming as it did smack in the middle of the annual session of the NPC, when media attention is focused on the capital. "This is exactly the kind of thing that happens around the time of the National People's Congress," says Russell Leigh Moses of the China Center in Beijing. "Cadres who don't necessarily get noticed a lot normally want to be seen as publicly carrying out the orders of the central government."
Indeed, if there is anything that will get the attention of the central government, it is the threat of terrorism. Chinese officials routinely declare that terrorism is "the greatest threat to the Olympic Games," as Minister of Public Security Zhou Youngkang put it last year. China's security forces exercise iron control and virtually unchecked powers. And yet the paranoia persists, stoked over the weekend by the Xinjiang delegation to the NPC. Bekri was not alone in making his announcement. Xinjiang Party Secretary Wang Lequan joined in the tough talk: "Terrorists, saboteurs and splittists are to be battered resolutely, no matter what ethnic group they are from."
The alleged attempt to blow up an airliner is the latest in a series of incidents relating to Xinjiang that have been made public in recent months. In January, the Chinese authorities said they had broken up a group calling itself East Turkestan Islamic Movement (ETIM), killing two and arresting 15 others. Chinese media suggested the group might have ties to al-Qaeda. Last November, Chinese media carried stories detailing death sentences against five ethnic Uighurs, natives of Xinjiang, for allegedly plotting terrorist activities. Chinese authorities say a small group of separatists is attempting to overthrow Chinese rule in the province and establish an independent Uighur state. The Lanzhou incident is bound to increase scrutiny and repression of Uighur dissent — with a Chinese public eager and concerned for a successful Olympics likely to be supportive of any new crackdown.

Comments by Elaine: This article is interesting as it focuses on the current issue of the war against terror. This is an especially glaring issue for China with the upcoming 2008 Olympics. Like the article states it is important to note that this “terror threat” was publicized during the NPC session and could be seen as a political move and also to deter any trouble makers who may want to disrupt the games in August. However, another point of view would be to question why is there Uyghur dissent in the first place? As we have studied in the “transnational issues” topic last year, it is the separatists who want to attain independence for Xinjiang using both violent and peaceful means. It is important to consider the Uyghurs relations with Beijing. Have they deteriorated to the point that the Uyghurs have to resort to terrorist means to get what they want? But then again, not all Uyghurs wish to establish an independent state, some just wish for more autonomy or for assimilation. Thus, we should not take everything at face value and should sometimes question further.

People vs. chemical plant

2008-04-01T18:23:00.004+08:00

People vs. chemical plant

Residents of Xiamen, a port city in east China's Fujian Province, never expected that "PX," an abbreviation for the word "paraxylene," would have become the hottest word on the tip of their tongues. Both their explanation and courage regarding this term have given birth to another definition -- "Protect Xiamen."

In 2006, the Xiamen city government introduced a US$1.41-billion chemical plant project, "the largest industrial project ever in the city's history." Tenglong Aromatic PX (Xiamen) Co Ltd headed the project. They expected to produce 800,000 tons of paraxylene (PX) and generate revenues of 80 billion yuan (US$10.45 billion) a year.
PX project site in Haicang District.Paraxylene is a highly polluting, carcinogenic petrochemical used to make purified terephthalic acid, a raw material needed for producing polyester film, packaging resin and fabrics.
The planned location of the PX project was in a development zone in Haicang, a district with more than 100,000 residents, where many Hong Kong and Taiwan businesses have invested.
The nearest residential area was less than 1,500 meters from the plant, and one fifth of Xiamen island lay within a radius of 10 kilometers. Gulangyu, or Piano Island, the city's largest tourist destination, was only 7 kilometers from the site.
About 4 kilometers from the site was Xiamen Foreign Languages School, a senior high school serving 5,000 students, attached to Beijing Normal University.
A man's desperation

Like many other young people, 30-yea-old Huang Qizhong wanted a home of his own after years of working in this beautiful port city.
I want a house with a big French window. The sun would stream down upon the floor and I would bathe in the sunlight.
I want a house with a beautiful garden and vast lawn. I would look out upon the blue sky and enjoy the warm breeze.
I want a house that faces the sea. I could hear its sound and smell its taste.
The Future Coast community in Haicang District.The Future Coast, a so-called No.1 health coastal residential community in southeast China, has no doubt fulfilled all his expectations for a home. Although the community lies in Haicang District, 20 km from the city center and most of the households are migrants, his dream house has an incomparable sea view and a modest price of 4500 yuan per square meter, as compared with 10,000 yuan per square meter and even higher in the city center.

In early 2006, Huang spent nearly all his savings and bought a house there. But soon his dream became an utter nightmare. An awful stench from a nearby wastewater treatment plant and a sour taste from a big chemical plant always make him sick and wake him from his dreams.
On May 10, 2006, he wrote about these issues that plagued him and posted this new topic on a local real estate forum. His thread read: "Let us unite and save ourselves and our fruits, our homes." He wrote down his cell phone number at the end of the thread.
A tossed stone raises a thousand ripples. On that very day, he received numerous calls from other house owners in his community. They decided to unite and safeguard their rights. Together they did a site investigation of the chemical plant.

On May 22, 2006, they sent a letter of complaint in the name of representatives of owners to Haicang District government, but received no response. Then they sent emails to Xiamen City Mayor's Mailbox, but their emails were forwarded to Environmental Protection Bureau of Haicang District; still no response.
On July 7, 2006, they sent the letter of complaint by EMS to the State Environmental Protection Administration (SEPA) and the National Development and Reform Commission (NDRC). Later, they tracked the number of the EMS and confirmed that the two departments had already signed for the letter.
On July 8, 2006, the NDRC issued an Official Reply of the NDRC on approving the PX plant and its accessory projects with an annual output of 800,000 tons, by Tenglong Aromatic PX (Xiamen) Co Ltd. This document, acquired by the Southern People Weekly magazine, reads: "The NDRC approves the PX plant and its accessory projects by Tenglong Aromatic PX (Xiamen) Co LTD, to provide necessary raw material for the company's PTA project." The document also asked Xiamen Municipal Development and Reform Commission to "accelerate the project according to the approval."
According to public reports, the project would bring to Xiamen a GDP of 80 billion yuan (US$10.45 billion), as compared to Xiamen's GDP in 2006 at 112.6 billion yuan.
The "big" figure made the house owners feel "small" and desperate.

"For us, the best way out is to move away from here, before house prices begin to fall sharply," Huang said.

So at the end of 2006, he tried to sell his house but finally he gave up. "The price of houses in other districts is much higher, we can't afford to move," Huang said.
Huang's experience epitomizes many other homeowners throughout the country who are trying to safeguard their rights but accomplish nothing.
Opposition from academicians
The appearance of an academician gave new hope to those homeowners of Future Coast like Huang.
Zhao Yufen, an academician with the Chinese Academy of Sciences, proposed that the plant be relocated to avoid the possible threat of pollution in the future.
On March 18, 2007, China Business published an article entitled "Dispute over the safety of the Xiamen PX plant" which said that led by Zhao, who is also a member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), the country's top political advisory body, 105 political advisors, most of whom are experts and scholars from colleges and universities, submitted a proposal during the annual session of the CPPCC in March asking for the plant to be relocated.

Citizens compared it to an "atomic bomb" and sent nearly one million text messages via cell phones to their friends and families urging the government to renounce the project.
"The Taiwan-funded Xianglu Group has begun building a PX plant. It's like an atomic bomb in Xiamen," read a text message that spread quickly in Xiamen at the end of May. "Many people will suffer leukemia and more babies will be born with congenital defects."
The mysterious text message."A paraxylene project should be at least 100 kilometers from a major urban settlement, but we are only 16 km from the project. For the sake of our future generations, please forward the message to all your friends," it reads. At the end of the message, it also calls for Xiamen residents to demonstrate in the street on June 1 to protest the project.
Even now the source of the original text message is still a mystery.

On May 30, the Xiamen authorities put on hold the chemical project, earmarked for the city's Haicang District, 16 kilometers from the city center, after encountering huge pressure from citizens who were virulently opposed to the project. They said the plant would pollute the environment and that it was potentially dangerous.
On June 1, nearly 2,000 Xiamen residents took to the streets in a protest march to demonstrate against the plant.
The demonstration continued on June 2.
On June 3, the Xiamen Public Security Bureau issued a notice asking organizers of the demonstration to give themselves up to the police, saying that they would otherwise be severely punished and even charged for criminal liability.
On June 7, the Xiamen municipal government announced that the construction of the chemical project would be decided by an environmental assessment.
A month later, the Chinese Research Academy of Environmental Sciences was entrusted by the Xiamen municipal government to carry out the assessment. Li Yanwu, Director of the academy's Center for Environmental Assessment, and his colleagues completed the report late last month.

According to an abbreviated version of the report posted on the official website of the municipal government, experts concluded that the southern area of Haicang District, the original location of the planned PX plant, was too small and inadequate for the diffusion of atmospheric pollution.
The local government had allocated two targets in the southern part of Haicang. These areas were targeted to develop a sub-center of the city and to create an industrial zone focused on the chemical industry.
However, according to the environmental assessment report, urban planners were advised to choose one or the other, but not both.

If the city government's priority is the first target, then the area is unsuitable for the development of the chemical industry, the report said. If the latter, a number of residential buildings should be demolished, citizens should be relocated and strict controls over the chemical plants should be imposed, the report said.

A blogger who insists
Lian Yue is a pen name of a columnist who lives on the Gulangyu.
"He is our spiritual support," another house owner of Future Coast Wu Yumei said.
Lian Yue posted about 150,000 words related to the PX project on his blog since he first reproduced and posted the report by China Business on March 18, 2007. He gave the thread a brief title - "Xiamen Suicides." At that time, this piece of reportage could not be found in any local media except Lian's blog.
On March 29, 2007, Lian called for Xiamen residents to break the information blockage and save themselves. He wrote in his blog, telling Xiamen residents to do 12 things:
1. Don't be afraid. Talking about the CPPCC proposal is not a crime; you won't get arrested.2. If you have a blog or often visit BBS, please post this news by China Business: "Dispute over the safety of the Xiamen PX plant." It is legal to reproduce and post any news report published by legally published newspapers and magazines on your own blog.3. If you are afraid, you can tell your friends, families and colleagues the facts and discuss it with them, they might have not known about the project yet.4. If you are still afraid, then tell your best friend and your family.5. If you are not afraid, tell your friends in Zhangzhou and Quanzhou cities, because they are also in danger.6. Tell them the following facts:7. This is a chemical plant opposed by 105 CPPCC members, some of whom are authorities.8. A PX project should be at least 100 km from the city to be considered as safe.9. Xiamen residents were deprived of the right to know about the PX project, a fact that proves the project is against the people's will.10. It will cause an economic recession, property depreciation and a reduction of tourists. Furthermore, Xiamen people will be considered as weak and stupid.11. Your possibility getting cancer will drastically increase. 12. You don't need to act bravely, just let people around you know the facts; you will not be blamed for Xiamen's future.
On May 30, he reproduced and posted on his blog a Xinhua news story that the Xiamen city government had announced it would suspend the project. On June 1, he reproduced a story by China Radio International reporting the demonstration against the proposed plant.
During this time, it is unknown that how much pressure he endured but significantly on June 9, Lian changed his MSN signature to: Every word you say is under surveillance.
"People live in Xiamen City say no to the project. This is a fact that has been recorded by history. The process of opposition is a great thing," Lian Yue told the Southern People Weekly in an interview.
On December 7, he signed up to attend a public hearing held by the local government to hear public opinions on the project. At this time he used his real name: Zhong Xiaoyong.
Government's role

An official from the Xiamen city government, who refused to give his name, said: "The government faces strong political pressure after the June 1 Demonstration," but he refused to specify regarding this pressure.
Another senior official from the CPC Xiamen city committee said: "The PX project is different, it was approved by the National Development of Reform and Commission. It is not up to us to decide what to do next."
Lin Congming, Vice Director of the city's Publicity Department, told the Southern People Weekly: "The Xiamen city government is an open and responsible government."
What Lin said is true if one judges from only one aspect. The city government may indeed be China's most accessible city government. No military guards stand at the entrance and citizens may come and go freely. One only needs to do a simple registration to get into the three office buildings; it's easy to find every senior official's office, even the mayor's office.
The Xiamen city government learned an important lesson about respecting the people's right to know. On June 13, Xiamen Mayor Liu Cigui said that the suspension of the project was not due to political pressure from the Fujian provincial government or the central government. He said that if the regional environment assessment report proved the project was not appropriate for Xiamen, the city government would then consider canceling or relocating it.
"The government's channel to communicate with the general public is always open. We published much information in local newspapers and broadcast on TV. I think, to some extent, the Internet and text messages on cell phones have twisted the project," Lin said.
According to the Southern People Weekly, some local officials still feel regret regarding the project's possible relocation, because it means a loss of possible GDP growth, a factor that still important when assessing local officials.
"Xiamen is the second biggest city in Fujian, but its GDP is lower than the third biggest city -- Quanzhou. This puts great pressure on officials in Xiamen. All the cities in China are pursuing quick GDP growth and Xiamen is no exception," said Xu Guodong, a professor with the Law School at Xiamen University.
The Xiamen government held two public hearings on December 13-14, 2007, seeking opinions on the project that was suspended on May 30.
Of the 107 people selected by lottery to represent the residents of Xiamen at the hearings, 91 opposed the project, 15 voiced their support and one left without speaking.
About 80 lawmakers and political advisers also attended - 15 addressed the forum and 14 of them spoke against the government's plan to build the plant.
The Beijing News reported on December 19 that the Xiamen government might relocate the halted US$1.41-billion chemical plant to Gulei Peninsula in Zhangzhou, Fujian. Zhangzhou has a population of more than 4.5 million.
Happy ending

On December 20, Lian Yue posted a statement on his blog saying that a win-win situation had been achieved. The government has regained the people's support, and people have successfully safeguarded their rights. He himself had finished his job regarding this issue. He stated that he wouldn't accept any further interviews on this topic any more.
On December 21, academician Zhao Yufen played down her own contribution and gave all the credit to all Xiamen citizens.
Wu Yumei, a house owner of Future Coast, told the Southern People Weekly: "Everything's becoming better. The event is a milestone in China. We are lucky."
(China.org.cn January 14, 2008)

China and the West: same bed, different dreams

2008-04-01T18:15:00.002+08:00

China and the West: same bed, different dreams
Sun Mar 30, 2008 10:25pm EDT
By Alan Wheatley, China Economics Editor - Analysis

BEIJING (Reuters) - Did you know that the slide in the dollar and the surge in oil to over $100 a barrel were part of a deliberate U.S. strategy to reduce the purchasing power of China's foreign exchange reserves?
Few in the West probably noticed the comments by Li Lianzhong, made last month in a public forum, even though he is the head of the Communist Party Central Committee's economic think-tank.
After all, no one has a monopoly on conspiracy theories.
But Li's views illustrate that, despite China's integration into the global economy, a gulf in comprehension sometimes separates Beijing and the West. The world is not yet flat.

Indeed, mutual recriminations seem to be on the rise. What is China up to in Africa? What are the real motives of its sovereign wealth fund? Western critics want to know. Why is Washington blocking investments by our companies? Why are Western media distorting coverage of Tibet? ask Chinese skeptics.
The danger for markets is that such antagonism could erode the trust underpinning economic links, especially when slower growth is putting Western politicians on the defensive and August's Olympic Games are heightening Chinese sensitivities.
"Both sides will need to learn better how to deal with each other. There are plenty of examples on both sides of misunderstandings and inability to comprehend how the society works, which then leads to real problems when it comes to the investment process," Jonathan Woetzel, a senior partner in McKinsey's Shanghai office, said in an interview.
As Woetzel put it, ties with the West can still be summed up at times with the Chinese saying "same bed, different dreams".

COMFORT LEVEL
That was the background to a visit to Beijing last week by OECD chief Angel Gurria, who made a pitch for closer cooperation with the 30 industrial democracies that make up his membership.
Gurria's purpose, he told reporters, was to make the OECD more relevant and to "create a level of comfort" on both sides.
The Organisation for Economic Cooperation and Development is in theory well suited to ironing out wrinkles in China's relations with the West. The Paris-based group does not lend money, so it has no pesky conditions to impose.
Rather, its members share information and establish best practice through peer reviews in what Gurria calls a "soft law approach". In short, member governments can take or leave the policy advice on offer. Perfect for Beijing.
The problem is that while China participates in a range of OECD activities, it is not a member.
And Gurria, though suggesting that China might join other emerging economies in the OECD's Development Centre, said Beijing had expressed no particular wish for full membership.
"This is too important to be urgent, so we should let it take its own pace," he said when asked about membership prospects.

U.S. Treasury Secretary Henry Paulson also stresses that building trust with China is a marathon, not a sprint.
Paulson, who made dozens of visits to China when he headed investment bank Goldman Sachs, is making the trek again this week, principally to meet Wang Qishan, a newly promoted vice-premier who is taking over responsibility for the "Strategic Economic Dialogue" that Paulson instituted with China in 2006.
FLASHPOINTS

Critics say the SED talks have delivered little of substance, but Woetzel said such structured dialogue is needed to avert the risk that Beijing or Washington ignores the other's interests, be it on security, the energy or the environment.
"Take energy. The U.S. and China are in the same boat. We are collectively the world's largest energy consumers, investors and polluters. So from the world's point of view, it's not 'either/or'. It's 'and'. So both countries need to work together and to explicitly think about a framework where they can consider each other's rightful interests and needs," Woetzel said.

Energy and the environment are obvious flashpoints as China's hunger for resources grows and concern over global warming mounts. Paulson will address both issues in a speech during his two-day visit.
China and the West have done well so far to manage the strains of the Middle Kingdom's meteoric economic rise. Beijing's accession to the World Trade Organisation in 2001 has taken a lot of the sting out of China's outsized trade surplus by putting the fiercest commercial disputes in the hands of a neutral umpire.
But getting both sides on the same wavelength will not happen in the blink of an eye. It was perhaps fitting that Gurria was in Beijing to launch a book about China's long-run economic performance -- from 960-2030 AD.
(Reporting by Alan Wheatley and Tyra Dempster; Editing by John Chalmers)

© Reuters 2007. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters.

China Above The Law

2008-04-01T18:12:00.001+08:00

China Above The Law
A Poorly Functioning Legal System Is Supposed To Hurt Economic Growth. But Nobody Told The Chinese.
NEWSWEEK
Updated: 4:25 PM ET Nov 5, 2007

On Feb. 2, a Communist Party journal published a speech by Luo Gan, a Politburo member and China's top law-and-order official, that startled the country's burgeoning legal profession and foreign investors. Luo declared that the Communist Party should maintain its dominance over the nation's courts and resist "enemy forces" that were trying to Westernize its legal system. Just a week earlier, Beijing had announced that the country's economy was continuing to grow at a dazzling pace, hitting 10.7 percent last year. The two headlines pointed to an increasingly conspicuous paradox that is puzzling observers: how is China's economy managing to grow so quickly without an independent and modern legal system? And how long can it continue?
Western economists and legal scholars have long argued that a robust legal system and impartial courts are prerequisites for a mature market economy. Effective, transparent and predictable judicial institutions are deemed necessary to assure businesses and customers that investments will be protected, contracts enforced and disputes resolved equitably. The rule of law encourages innovation by establishing intellectual-property rights and ensuring that inventors--and the firms that back them--are rewarded for their efforts. Without these protections, it is assumed, stock exchanges, commodities markets and other hallmarks of a complex capitalist economy cannot function properly.
Many developing countries with weak judicial systems have been hobbled by corruption, waste and inefficiency. But China seems to be thriving despite its own rudimentary court system, which remains firmly under Communist Party control. Since Beijing introduced free-market reforms in the late 1970s, a booming private sector has emerged, hundreds of millions of people have escaped poverty and overseas investment has flooded in. The secret: entrepreneurs have found a variety of creative solutions to get around China's unreliable courts. These include seeking mediation for business disputes from sympathetic party officials, enforcing contracts by threatening to go elsewhere, and protecting trade secrets with heightened security--solutions aided by the pro-business slant of China's leadership.
Beijing all but abolished the legal profession during the Cultural Revolution. After Mao Zedong's death, it slowly began to rebuild the judiciary, adopting Western-inspired reforms. Today China's courts do function after a fashion, and its citizens are turning to them in record numbers--about 8 million cases were filed last year. Indeed, China's leaders now tout the rule of law as one of their guiding principles.
But in reality, legal reform has lagged far behind changes in China's economy. Though education levels are rising, for example, many judges, lawyers and prosecutors remain poorly trained. Cases are still often decided by bribes and political connections. And the party shows no sign of ceding its control--almost all judges are party members and required to obey its orders. Beijing still fears that an independent judiciary could undermine the party's monopoly on power.
In place of a proper legal system, however, other mechanisms have emerged to play its role. Large foreign and domestic firms, for example, have learned to resolve or avoid contract disputes by exploiting the country's hypercompetitive business environment. If a supplier fails to deliver on time, they simply threaten to give their business to someone else. And China does have rules, which are largely pro-business, though they are enforced differently than in the West. For example, the government recently imposed a new regulation requiring local officials to grant business licenses faster, leaving bureaucrats less time to demand bribes. "People from legal societies always underestimate the power to affect change through administrative, rather than legal structures," said Arthur Kroeber, managing director of the economic research firm Dragonomics in Beijing.
Corruption is widespread, but it has not hurt the economy as much as expected because the party has begun evaluating its officials based on economic development in their jurisdictions. Though many bureaucrats exaggerate local growth rates, many others strive to attract businesses to their areas and help them grow. "There is political motivation" to resolve disputes, says Richard Thoman, who spent two decades doing business in China as a top executive. "The local mayor can smooth things out for you. In a sense, it's almost like an arbitration process."
Similarly ad hoc solutions have developed for protecting property rights. Foreign businesses often complain about China's poor record in this area; pirated DVDs and knock-off luxury handbags are still easy to find. But this hasn't stopped Chinese and some foreign companies from innovating. Douglas Fuller, a visiting professor at the Chinese University of Hong Kong, points out that Taiwanese computer-chip design firms have succeeded on the mainland by adopting tight security measures at their factories and designing products that are difficult to reverse-engineer.
A spin on that strategy comes from Leonard Liu, founder of the U.S. software company Augmentum. Applying lessons he learned while managing two Taiwanese companies, he has protected Augmentum by requiring much stricter protections at its Chinese offices than exist at its U.S. facilities. Augmentum's computers in China have no removable disks and their USB ports are disabled. There is no externale-mail system, and any employee who attempts to connect to the Internet without permission is fired. "We make sure you cannot take anything away that is in bits and bytes," Liu says. "American style [intellectual-property] protection is very helpful for innovation, but I will not say it's necessary."
Of course, there's no guarantee that China's economy can continue to grow at its current pace with such jury-rigged solutions, and many experts expect it to falter unless an independent legal system emerges. These experts argue that the need for clear rules and procedures will grow as Chinese society and commerce become more complex, and the current workarounds--based on a hodgepodge of informal rules and personal relationships--will become less useful. Among those making this argument most forcefully are members of China's own burgeoning legal profession who favor Western-style reforms.
Giving impetus to their cause are increasing numbers of ordinary Chinese citizens, who have taken the Communist Party's rhetoric about the rule of law at face value and are starting to demand more from the country's courts. "Chinese bookstores are filled with quite good books about how the legal system can be used," says Jerome Cohen, an expert on Chinese law and a proponent of Western reforms who teaches at the NYU School of Law. "You're finding people who are really trying to make the system work like it does in other countries," he says.
But other pundits argue that China may well keep on defying expectations by continuing to grow without major legal reform. They point out that the government has proven deft at maintaining social order and encouraging other trends that could keep the economy humming. "Economic growth here depends [more] on cheap labor and a stable political environment, [and less on] the improvement of the legal system," says Pan Wei, a professor at Beijing University's law school. "And political determination is also very important."
Moreover, the sheer size of China's economy is likely to continue luring local and foreign investors, regardless of the legal environment. "China's a special case because there is still great faith in the Chinese market and its potential," says Michael Dardzinski, a Beijing-based corporate lawyer. "The rule of law is just one issue among many others that is weighed against the long-term potential to make money." Lawyers and academics may continue to argue about whether reform is necessary and how to make it happen. In the meantime, others are simply taking care of business--any way they can.

URL: http://www.newsweek.com/id/68381
© 2007

Not Quite So Cheap

2008-04-01T18:00:00.001+08:00

Not Quite So Cheap
America begged China to strengthen the yuan. It has, but the results haven't made anyone happy.
Mary Hennock
NEWSWEEK
Updated: 12:49 PM ET Mar 8, 2008

With the dollar falling to record lows against the euro and the yen, no one is watching the yuan. Not even the American presidential candidates who had been blaming U.S. trade woes on Chinese currency manipulation. But look: after years of increasingly anguished Western calls for China to free its currency, Beijing finally has. The yuan strengthened against the dollar by 7 percent last year, and an additional 3 percent so far this year.
If the United States is starting to get the yuan it asked for, it is not seeing the results it expected. The American argument was that as the Chinese get richer, the yuan should get stronger, so they can buy more U.S. goods and help correct the huge U.S. trade deficit with China. The Bush administration spent plenty of time spotlighting China's "unfair" exchange rates at the IMF and G8 summits last year. Hank Paulson's appointment as Treasury secretary was trumpeted as a way to gain traction on the currency issue in particular, because as chairman of Goldman Sachs he developed strong relations with Chinese officials. But the rise of the yuan has not had an impact on the trade balance.
To those who've crunched the numbers, it's not a surprise. As American economists like Fred Bergsten have noted, Chinese labor is so cheap in comparison with American labor that it would take at least a 40 percent appreciation of the yuan against the dollar to make a dent in imbalances. What's more, Beijing's reasons for easing up on the yuan have nothing to do with ties to Paulson, much less concern about candidates like Senators Clinton and Obama, who threaten to punish "currency manipulators."
China has its own worries, particularly inflation. Last week, when Prime Minister Wen Jiabao delivered his annual report to China's Parliament, he stressed the twin perils of overheating growth and inflation. Wen told delegates it was vital to "keep structural price increases from turning into significant inflation." Consumer inflation hit 4.8 percent in 2007 (the government's target was 3 percent). In January, it surged to 7.1 percent, an 11-year high.
A stronger currency is seen as a key weapon against inflation. Aside from food inflation, "what concerns policymakers is inflation related to raw-material costs," says Qing Wang, Morgan Stanley's chief economist for Greater China. A stronger yuan would reduce the price of dollar-denominated oil, steel, copper and other minerals. Last month the central bank said it would "further bring out the role of the exchange rate" to promote balanced growth.
It will have to go much further to help U.S. businesses, but already the rising yuan is hurting Chinese exporters by making their goods less competitive abroad. The exchange-rate shifts have helped knock as much as 20 percent off profits at some small and midsize firms, which represent 71 percent of jobs in China.
Economists now expect China's currency to gradually appreciate by some 10 percent over the next year. Smaller firms will likely continue absorbing the appreciation, as well as the extra costs of fuel and raw materials, in tighter profit margins. At the same time, they are also under pressure from new labor and human-rights laws, pushed by the West and some Chinese. Pensions and health insurance are now compulsory, and firing harder. Small firms complain that adds roughly 20 percent more to their costs. Wang Jianping, a small Wenzhou-based shoe manufacturer whose costs went up more than 20 percent last year, thanks to both exchange rates and labor, believes that forcing Chinese small business to adopt such Western laws is like judging "a primary-school student with the standards of a college student."
What do Americans make of all this? Mostly, they aren't impressed. U.S. Democratic Congressman Sander Levin has been one of China's staunchest critics, pressing for labor rights to be written into trade deals. He says the recent renminbi appreciation is "a positive development," but "more rapid and sustained appreciation is necessary," while any suggestion the renminbi is near a fair market value is "simply false." As the United States heads into recession, others are now beginning to complain that currency appreciation is actually a bad thing. National Association of Manufacturers vice president Frank Vargo says yuan appreciation is "definitely" stoking U.S. inflation as China-made goods rise in price.
For now, the plummeting dollar has dampened the fervor of last year's U.S. debate on the yuan. That could change. The Democratic contenders have both ratcheted up their rhetoric on the yuan to clinch blue-collar support, and John McCain is a notorious free trader. The election outcome probably does not matter, however. What the record shows is that China will free the yuan (or not) for its own purposes.

URL: http://www.newsweek.com/id/120102
© 2008

A Piracy Culture

2008-04-01T17:49:00.001+08:00

A Piracy Culture
Beijing continues to defy U.S. and European efforts to stop IP theft.
NEWSWEEK
Updated: 8:05 PM ET Oct 15, 2007

On a recent afternoon at Beijing's famous Silk Street Market, a vendor displayed a wide selection of Burberry rain coats. Price: $40, subject to negotiation. Like virtually all of the luxury goods for sale at the market, the coats were counterfeit. To tourists who swarm the market daily, they may seem like just another great bargain. But to Beijing's critics they are a symbol of indifference, if not outright defiance. Burberry is one of five companies suing the Silk Market, five of its vendors, and the landlord of the property himself, for selling knock-offs of its products. (The other brands are Gucci, Chanel, Prada, and Louis Vuitton, which just opened its first outlet in Beijing.) The companies are seeking a few hundred thousand dollars in compensation, among other remedies. The landlord of the building, Zhang Yongping, said in an interview recently that he is innocent, adding: "We don't allow any fake products in the market." Told of the prominent display of Burberry coats just a few floors down from his spacious office, Zhang turned to his lawyer, who quickly told a NEWSWEEK reporter, "Tell us which vendor it is and we'll go down there."
The cloned garments in the Silk Market, and Zhang's seemingly feigned ignorance of their existence, shows why some experts think the fight against Chinese intellectual-property violations is hopeless. Western governments and corporate executives are deeply frustrated by China's indifference to the IP issue, but rather than give up, both are putting more pressure than ever on Beijing to crack down on pirates. In October, the U.S. initiated action at the World Trade Organization, demanding that China provide details of its efforts to combat piracy, including information about specific cases and their outcomes, by the end of January. "I think we continue to see a troubling disconnect between comments made by Chinese leaders and enforcement," Chris Israel, the U.S. Commerce Department's Coordinator for International Intellectual Property Rights, told reporters at a recent IPR roundtable hosted by the American embassy in Beijing.
Indeed, despite years of legal action by corporate America, the piracy problem is worse than ever. At the U.S. Embassy round table, an assistant FBI director said U.S. companies lost $40 billion in 2004 alone from intellectual-property rights violations, most of them committed in China. There is almost nothing that Chinese firms don't copy--software, movies, clothes, auto parts, computer-chip designs, even antibiotics. For years, most of the piracy was confined to the local Chinese market. No longer. Chinese exports of fakes are on the rise. According to a report by the U.S. Patent and Trademark Office, the value of counterfeits coming into the United States from China was up 47 percent in 2004 from about $134 million in 2003. (About 67 percent of counterfeit goods seized by U.S. Customs officers came from China.) The report noted that IP infringement in China had reached "epidemic levels."
China presents unique challenges. The central government has long viewed intellectual property not as an individual right, but as something to benefit the state. It encouraged borrowing, if not stealing, technology (especially foreign technology) on which to build a strong economy. Now that the nation is booming, the commercial environment is so competitive that many see ripping off other people's ideas as the quickest way to cash in.
The Internet has multiplied all of the enforcement problems a hundredfold. College students across China, like many of their peers in the U.S. and elsewhere, download the latest Western television shows and movies from vast networks of computers. One young student recently interviewed by NEWSWEEK said that it was legal to do so; after all, she was using a network run by her university. "Cybercrime, including IPR infringement, is the fastest-growing problem faced by China-U.S. cooperation," FBI Assistant Director Louis M. Reigel III said recently in Beijing.
That's one reason Chinese companies spend far less than their Western counterparts inventing new products and innovations. According to a 2003 report by the accounting firm PriceWaterhouseCoopers, China spent less than 6 percent of total R&D on basic research, compared with 19 percent in the United States. Companies spend more time and money tweaking existing technology just enough to avoid paying royalty and licensing fees. Some government officials implicitly support this practice, railing against unfair foreign patent royalties, for example.
Foreign firms are desperately seeking ways to protect their brands in China. Victor Kho, a Hong Kong-based investigator, spends his days researching counterfeit networks and coordinating raids for his clients, which include Mercedes and Ford. "Progress is being made, but may be slower than people expected," he says. "There are too many people who want to be rich, and copying things is the easiest way."

URL: http://www.newsweek.com/id/47450

Taiwan polls: Whither independence?

2008-04-01T10:07:00.002+08:00

Taiwan polls: Whither independence?
By Sheng Lijun, For The Straits Times
TOUCHY TOPIC: A protester demonstrating against a referendum on the DPP's proposal to join the UN under the name 'Taiwan'. The referendum will be held together with the presidential poll.
TAIWAN'S election has once again gained worldwide attention. But does it matter?
If Kuomintang (KMT) candidate Ma Ying-jeou wins, Taiwan will not get too close to China, otherwise the pan-blue alliance would likely lose the next election.
If the Democratic Progressive Party's (DPP) Frank Hsieh wins, Taiwan's independence will also wane.
Taiwan's independence depends less on how well it does or who wins the presidential election, but more on how badly China does. Should China eventually develop into a strong continental civilisation, Taiwan's independence will be only a daydream, whatever it does.
Taiwan could have followed Hong Kong in going along with China's rise. Should China continue to rise, Taiwan would continue to benefit massively. But if China should fail badly, Taiwan would have its independence, hands down, without so much turmoil as it is experiencing now.
Because of either pride or misjudgment - or both - Taiwan has chosen a difficult path. It has proven to be a bumpy road, resulting in broken dreams, missed opportunities, a limping economy and a battered bureaucracy. Taiwanese society is becoming ever more ideologically fragmented, emotionally torn and politically intolerant - a miniature 'Cultural Revolution' in the making.
Taiwan's independence depends less on how well it does or who wins the presidential election, but more on how badly China does. Should China eventually develop into a strong continental civilisation, Taiwan's independence will be only a daydream, whatever it does. Yet, Taiwan matters. It matters less in itself than how it can trigger an unforeseen chain reaction involving China and the United States. It can drag them, together with many other countries, down the road towards violent confrontation.
We remember that Taiwan once came out with a highly provocative 'two-state theory' precisely at a time when relations between China and the US were deteriorating following the US bombing of China's embassy in Belgrade and the consequent emotional Chinese demonstrations against the US.
The timing made people suspect that Taiwan might be intent on inciting a China-US military confrontation, since without such a confrontation the prospect of its independence is built on shifting sand.
To put it bluntly, while many countries would worry about a US-China military showdown, Taiwanese independence advocates may not share this worry.
This makes most countries stay away from supporting full-fledged independence for Taiwan. The only chance of Taiwanese independence coming to pass lies in not merely a weakened but a broken China. (We still remember Mr Lee Teng-hui's once expressed the desire to see China divided into seven pieces.)
Many in the Asia-Pacific hope to benefit from China's rise. Even those who hope to see a weak China do not necessarily want to see China collapse so violently as to break into several pieces.
This is why Taiwan independence advocates find it so hard to get support from many countries. It is not so much because China is too strong but rather because these countries have a vision of what a future China might look like. This is partly why Taipei's relations with Washington have been strained in recent years and why it has been left out of the fast-developing regional integration of East Asia.
Whatever changes Taiwan might make following this Saturday's election would not matter too much to the region. The only thing that would matter is if Taiwan challenges the current regional power structure. The region would ask a simple question: Would such a challenge benefit the region or be at its expense?
China does care about who wins the election. But it cares more about the unforeseen 'chain reaction' that Taipei's actions might instigate. Just as the Belgrade bombing gave Taiwan the opportunity to spring its 'two-state' theory, the Beijing Olympic Games provides it with another such opportunity. President Chen Shui-bian still keeps Beijing guessing as to what 'surprise gift' he has in store for the Games.
Since early this year, Beijing has been adopting a 'soft approach' towards Taipei. This should not be cause for relief in Taiwan. Instead, it should be cause for worry.
There are two major reasons for Beijing's soft approach: to avoid playing into the hands of the DPP during the election and disadvantaging the pan-blue alliance; and to place the ball squarely in Taipei's court.
If China were to take strong action against Taiwan later on - should it give Beijing a provocative surprise during the Olympics, say - China would have more international understanding and sympathy.
Together with the soft approach, Beijing has also shown its 'hard approach'. It has brought unprecedented diplomatic pressure on the US, Japan and other countries on the issue of Taiwan's UN referendum.
Beijing is clearly preparing the ground against the unpredictable Mr Chen. So long as it can ensure that there will be no unfavourable international chain reaction, whatever surprise Mr Chen has in store for the Olympics would be of little concern to Beijing.
A careful reading of the trajectory of China's Taiwan policy tells us that this policy does not consist solely of damage-control. It also aims to benefit from Taiwan, to turn it from a strategic liability into a strategic asset.
Taiwanese businessmen bring to China not only funds but also the latest Western technology. This is of immense help as China upgrades its industry and moves up the value-add chain. This approach carries profound strategic implications for China, for Taiwan eventually, Japan and even the US.
China also skilfully uses the Taiwan issue to boost the modernisation of its armed forces, the People's Liberation Army. This, if well managed, will not exhaust China. On the contrary, it can bring about faster economic modernisation, for breakthroughs in military technologies can be converted quickly for civilian use.
Throughout history, important technological breakthroughs have often been generated for security purposes before being converted for civilian use to generate economic benefits. Examples of this conversion include the radar, computers and the Internet.
This is another example of how Taiwan matters to China - but in an unexpected, even funny, way.
The writer is a senior research fellow at the Lee Kuan Yew School of Public Policy, NUS.

China, US to push on with nuclear, security talks

2008-04-01T10:04:00.000+08:00

China, US to push on with nuclear, security talks
'We also had an in-depth exchange of each other's views of Asian security issues - that will lay the basis for us continuing that kind of discussion that we both agree is very important,' said Mr Sedney. -- PHOTO: AFP
SHANGHAI - CHINA and the United States have agreed to deepen a dialogue on nuclear and Asian security issues following the end of high-level talks in Beijing this week, the US defence department said on Saturday.
The discussions were part of ongoing Sino-US defence consultations aimed at increasing mutual understanding and avoiding miscalculation between the two powers, said David Sedney, deputy assistant secretary of defence for East Asia.
'We had very positive discussions on that (nuclear strategy and policy) and we expect to be moving forward with that dialogue very shortly,' Mr Sedney said at a press briefing in Shanghai.
'We also had an in-depth exchange of each other's views of Asian security issues - that will lay the basis for us continuing that kind of discussion that we both agree is very important.'
The talks were followed by a signing on Friday of two agreements announced earlier this week between the countries.
The first gives Washington access to Beijing's military archives to search for missing servicemen from conflicts since World War II.
The other was an agreement to establish a telephone hotline between the two armies, which is expected to be operational in about a month, Mr Sedney said.
The military hotline was first suggested by the United States in 2003, and US President George W. Bush reached agreement on the link when meeting his Chinese counterpart Hu Jintao at a regional forum in Sydney in September.
The two nations discussed the issue further in November last year when US Defence Secretary Robert Gates visited Beijing.
US and Chinese heads of state have been able to communicate over a similar line since the late 1990s but the new hotline will be China's first direct military telephone link with another country.
Reduce misunderstandingsMr Sedney said it aims to reduce misunderstandings between the two militaries, although its effectiveness and exact use was still to be determined.
'In terms of specifically how we use it, for what issues and at what time is something we will have to develop with the Chinese. The purpose is to address emergency, crisis or important issues that need immediate communication,' said Mr Sedney, adding that the line would have come useful amid tensions between Beijing and Washington last year.
Sino-US relations remain tetchy despite warming dramatically since spiralling to a low in 2001 when Chinese jet fighters collided with a US Navy surveillance plane forcing it to land on Chinese soil.
The US Pentagon remains irked by a Chinese military build-up that it believes is aimed at thwarting American intervention in a conflict over Taiwan, and ultimately challenging its access to the region.
US suspicions intensified in January last year after a Chinese anti-satellite test in which a ballistic missile was used to destroy a Chinese weather satellite in low Earth orbit.
And in a flare-up in November, Beijing denied US warships port entry in Hong Kong, a decision that Mr Sedney said the Chinese have never adequately explained.
Meanwhile, China called on the US earlier this month to provide more information about its shooting down of a defunct US spy satellite, amid concerns about space security. -- AFP

Beijing Olympic organisers say athletes to follow IOC's rules

2008-04-01T10:02:00.000+08:00

Beijing Olympic organisers say athletes to follow IOC's rules
Human rights groups eager to use the Olympic Games to raise awareness of China's human rights record, free speech restrictions, and support for Sudan's government that stands accused of backing atrocities in Darfur. -- PHOTO: REUTERS
BEIJING Olympic organisers said Tuesday all athletes should follow International Olympic Committee rules governing political and religious activity, but would not comment on accusations that Britain had sought to gag its athletes at this summer's Games.
On Sunday, the British Olympic Association said it would require its athletes to sign a new clause in their contracts barring them from making politically sensitive remarks or gestures during the Olympics.
Following an outcry, the association's spokesman Graham Newsom said on Monday there had been 'no intention of gagging anyone' but admitted that its Team Members' Agreement appeared to go beyond the provision of the Olympic Charter.
Reached by phone on Tuesday, Beijing organising committee spokesman Sun Weide did not respond to questions about the British controversy.
'We welcome athletes from all over the world to come to Beijing for the Olympics, and we also hope they will follow the Olympic spirit and the IOC's rules,' Mr Sun said.
The British Olympic Association has instructed athletes headed for Beijing that they should abide by IOC-backed regulations that state they should not comment on any politically sensitive issues or take part in political, religious or racial propaganda at the Olympic sites and venues.
British Olympic officials said the instructions had been in affect for at least 20 years and that they were sent to athletes who had not seen them before because they would be competing at the Olympics for the first time.
Nevertheless, the British group's move drew strong criticism from human rights groups eager to use the Games to raise awareness of China's human rights record, free speech restrictions, and support for Sudan's government that stands accused of backing atrocities in Darfur.
'This affair is indicative of the lack of courage that characterizes some officials in the Olympic movement nowadays,' Paris-based Reporters Without Borders and anti-censorship group Article 19, headquartered in London, said in a statement.
'Such behaviour ends up making the Chinese authorities look like victims with whom one has to choose (one's) words carefully. This is back to front. The victims are the thousands of political prisoners and the 100 or so journalists, Internet users and bloggers who are in prison solely for expressing their views peacefully,' the groups said.
Newsom said the British Olympic Association had not tried to put any block on free speech and had been under no political pressure from Beijing.
In January, Belgian athletes were told they would be prohibited from raising human rights or other political issues at Olympic venues. Outside the sports venues and Olympic village, however, they will be free to speak their mind.
Separately on Tuesday, Darfur activists highlighted the Olympics in an open letter to Chinese President Hu Jintao condemning Beijing's support for Khartoum.
'As the 2008 Beijing Olympic Games approach, we will continue to call on the Chinese government for action,' said the letter, signed by eight Nobel Peace Prize laureates, 13 Olympic athletes and 46 parliamentarians, along with celebrities including actress Mia Farrow and hip-hop mogul Russell Simmons.
'We are aware of the tremendous potential for China to help bring an end to the conflict in Darfur,' the activists said in the letter, which criticised Beijing's support for Sudan at the United Nations and said China's robust trade with the country was underwriting abuses in Darfur. -- AP

China, Japan vow to solve sea dispute: report

2008-04-01T09:58:00.000+08:00

China, Japan vow to solve sea dispute: report
BEIJING - CHINA and Japan have pledged to work towards settling a long-standing row over the gas-rich East China Sea after two days of high-level talks here, state media reported.
Japanese Vice-Foreign Minister Mitoji Yabunaka and his Chinese counterpart Wang Yi led discussions during the most recent round of the bilateral 'strategic dialogue,' the Xinhua news agency said late on Saturday.
Both sides 'should continue to make efforts in accordance with the consensus reached by the leaders of both countries, to strive for the early proper settlement of the issue', Xinhua quoted the Chinese foreign ministry as saying.
Japan and China, two of the world's largest energy importers, have failed in a dozen rounds of talks since 2004 to agree on how to share lucrative gas resources in the East China Sea.
China started drilling in 2003 and Japan has charged that Beijing may be siphoning off what it considers its own gas reserves.
During a visit to China in December, Japanese Prime Minister Yasuo Fukuda and Chinese President Hu Jintao agreed to seek a resolution on the gas dispute at an early date, although no major breakthrough has yet been made.
Mr Hu is expected to visit Japan in the next few months.
'President Hu Jintao's visit to Japan this year will be a historic visit that will carry on the past and open a way for the future,' the Chinese foreign ministry said, according to Xinhua.
'The two sides are ready to strengthen cooperation to ensure the complete success of the visit,' it said.
The delegates had also been widely expected to discuss a recent food scare in Japan involving toxic dumplings imported from China.
However, Xinhua made no mention of the issue in its reports on the two days of talks in Beijing.
China and Japan have launched a joint investigation into the dumpling scare that so far has resulted in 10 Japanese consumers being poisoned by pesticides after eating tainted dumplings imported from China.
Mr Hu dispatched his top envoy Tang Jiaxuan to Tokyo to address the issue and last week expressed sympathy to the Japanese people who fell ill. -- AFP

CHINA'S NATIONAL PEOPLE'S CONGRESS

2008-04-01T09:56:00.000+08:00

PM Wen issues warning to Taiwan
Island cannot decide its political future unilaterally, he says at opening of parliament
BEIJING - CHINESE Premier Wen Jiabao told Taiwan yesterday it cannot unilaterally decide its political future as the island prepares to hold a contentious referendum on whether to seek UN membership.
Taiwan, which China claims as its own, is to hold the referendum alongside presidential polls on March 22, ignoring warnings from China and the United States. Washington is concerned about instability across the Taiwan Strait.
The referendum has riled Beijing because it calls for the island to join the United Nations under the name 'Taiwan' instead of its official title 'Republic of China'. The latter connotes fealty to Beijing's 'one China' principle.
'Any issue that concerns China's sovereignty and territorial integrity must be decided by all the Chinese people, including our Taiwan compatriots,' Premier Wen told the opening of the annual session of parliament yesterday.
He said Taiwan's pro-independence activities were 'doomed to fail' - a remark echoing President Hu Jintao's warning just a day ago.
On Tuesday, Mr Hu told China's top political advisory body that 'Taiwan independence' activities 'will get nowhere and are doomed to fail'.
But like Mr Hu, Mr Wen also extended Taiwan an olive branch, renewing an offer to enter into negotiations. 'We will work for the early resumption of cross-strait negotiations on the basis of the 'one China' principle,' Mr Wen said.
However, the 'one China' principle, which says Taiwan and the mainland are part of a single sovereign country, has long been rejected by Taiwan as an unfair precondition.
An official with Taiwan's ruling Democratic Progressive Party dismissed Mr Wen's remarks.
'Mr Wen's comments are not different from years past, but they've hardened their position, especially when they say Taiwan can't decide its future for itself,' said Mr Lai I-chung, the party's deputy international affairs director.
Yesterday, Taiwan President Chen Shui-bian said he is agreeable to separating the referendum from the presidential poll, but on condition that the opposition Kuomintang (KMT) agrees to amend the referendum Act to lower the high threshold required to make it legally binding.
A referendum is only successful if more than half of Taiwan's 16.8 million eligible voters cast ballots, and more than 50 per cent of the votes support the initiative. And the KMT is unlikely to agree to a change.
REUTERS

China's loans to Africa are help not harm

2008-04-01T09:50:00.001+08:00

By Li Xujiang (China Daily)Updated: 2007-08-13 06:44

Last November, China promised African countries $3 billion in preferential loans and $2 billion in preferential buyer's credits. During the African Development Bank meeting in Shanghai in June, China unveiled a $20 billion package of loans to Africa.
These deals have received criticism from G8 members, saying their large size could put new debt burdens on African countries and even lead to another debt crisis, and that the loans could undermine Western countries' debt relief attempts. China's increasing trade ties with Africa are also accused of undermining the West's efforts to promote good government and resolve conflicts.
"It is unreasonable for the West, the IMF, the World Bank or any other international organization to oppose China's loans to Africa," Professor Li Baoping, an expert on Africa studies in Peking University, said.
China is not the biggest lender to Africa. And it has never put extra terms on loans or put pressure on the paying of debts. Most of the loans to Africa have been canceled.
For example, China canceled about $1.4 billion debts to 31 underdeveloped African countries. That would not add to their debt burden.
Besides, China's loans and other aid to Africa mainly go on the construction of infrastructure, farms, factories, as well as stadiums, conference centers, hospitals and schools.
These constructions are useful for strengthening the self-developing capability of African countries, Li said.
In fact, the economy in Africa has improved a great deal over the years.
Statistics show that Africa has been developing continuously for more than a decade with average annual growth being 5 percent over the past three years. The IMF estimates Africa's growth is edging toward 6 percent, its highest in 30 years, and China's increasing trade and investment help African countries to be more involved in world trade.
China is not the only country in the world that has been providing Africa with loans and aid. So why is it singled out as endangering Africa with debt woes?
The only difference between China's loans and those of other countries is that China's loans have no terms attached. That makes loans from China more attractive to African countries than those from Western countries or the World Bank.
"We would rather take loans from those who don't set conditions. In the past few years, this has often meant China," Jeremy Goldkorn, a reporter from South Africa in China, said.
The loans to Africa from some Western countries and international organizations have strict conditions and have been proven unsuccessful in most countries. Years of aid from the West not only failed to prompt economic growth but propped up corruption and inefficient governments.
China is becoming closer to Africa than the Western countries are, and that worries them.
"The Western countries think China has spoiled their efforts to impose the so-called good government in African countries by taking away from the West its advantageous position in Africa," Li said.
What some Western countries do to punish countries that, in their opinion, have problems with "democracy", "good governance" can only harm local people without solving the problems, Li said.
"We must also see that since the independence of these African countries they are improving, politically. We cannot judge these countries which have only a little more than 40 years of history by the West's standards," Li said.
China's aid to and cooperation with African countries are built on respect, respect for their internal affairs and self-development. That's also why China is favored by African countries.
"Among African countries' ruling elites, there is a great deal of enthusiasm for China's involvement in Africa because many people see China as a development partner that is not tainted by a history of colonialism, a partner that does not 'talk down' to African countries," Goldkorn said.
The criticism over China's aid to Africa comes at a time when China and Africa are enjoying a rapidly growing cooperative partnership and the economic ties between the two sides are getting ever stronger.
Since the establishment of the Forum on China-Africa Cooperation in 2000, trade and investment exchanges between the two sides have increased enormously. China's trade with Africa totaled $40 billion in 2005, up 35 percent on 2004. It is estimated the figure will surpass $50 billion this year and will double by 2010.
The author is a graduate student at Beijing Foreign Studies University
(China Daily 08/13/2007 page4)