The Adventures of CSE Students!

Wednesday, April 2, 2008

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.

Labels: 07S501, Administrative, Biotech industry, Justice System, Sarah 07A201, short march, trade with the EU

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Monday, March 31, 2008

extracted from: http://sg.biz.yahoo.com/071128/1/4d12q.html

China and Europe confronted each other over their long-running trade dispute here Wednesday, with the EU calling for a level playing field and Chinese Premier Wen Jiabao insisting on gradual reform.

"The EU exports less to China than to Switzerland, a country of seven million people," European Commission President Jose Manuel Barroso told business forum on the sidelines of annual summit between the two sides.

"Our ultimate goal is to create a level playing field for both sides."

EU Trade Commissioner Peter Mandelson spoke out at the same forum about China's trade surplus, which has put the focus on the Chinese currency, the yuan, with critics arguing it is being kept artificially weak.

"Our trading relationship with China started as we know in a balanced way," Mandelson said, with Wen in the audience.

"Now it is less balanced. Indeed in my time in China these last five days, it has grown by over two billion euro," he said, referring to Beijing's trade surplus.

In closed-door talks with Barroso earlier Wednesday, Chinese President Hu Jintao pledged to do more to cut the surplus, according to an EU official.

"I don't favour a sizable trade surplus with the EU. We are ready to work with you to reduce our surplus," Hu said, according to the official, who asked not to be named.

Meanwhile, Wen told the audience of European and Chinese business chiefs that China would continue with its policy of gradual reform of the yuan, also known as the renminbi or RMB.

"China will continue to reform the RMB exchange rate regime in a gradual, proactive and manageable manner," he said, while insisting the Chinese currency was not the only reason for their trade dispute.

"The exchange rate is a cause to some extent, but not the sole decisive factor behind the trade deficit."

The weakening US dollar was the main reason the euro was strengthening, Wen later told journalists, adding that Brussels would be better off bringing up the issue with Washington.
"I propose that the best way to address this problem is to take it up with the American financial authorities," Wen said as Barroso looked on.

However, during talks both sides agreed to set up a high level "mechanism" to address trade issues, including the trade deficit, market access in China and Beijing's intellectual property rights regime, Barroso said.

The joint mechanism would hold its first meeting in March next year, he added.

While the Chinese currency has risen against the US dollar for more than two years, it has fallen against the euro, making Chinese products cheaper and more competitive in Europe.

"They have to consider that not all adjustments should be focusing on the relationship between the dollar and the yuan," EU Economic Affairs Commissioner Joaquin Almunia told reporters in Beijing.

"They must think about the evolution of the exchange rate toward the euro," he said.

Amid the dispute, European representatives said they wanted to avoid protectionist measures.

"We... need to identify a solution to solve this question, and I hope that it is a cooperative one," Serge Abou, the EU's ambassador to China, said in an opinion piece in the China Daily newspaper published Wednesday.

"Protectionism is not a winning option. So let us unite our efforts to resist protectionist trends."

The EU, China's largest export market, ran a trade deficit of 128 billion euros (175 billion dollars) with China last year -- which is likely to balloon to 170 billion euros in 2007, according to EU statistics.

The European delegation headed by Barroso also met with Li Keqiang, a member of the ruling Communist Party's nine-member Politburo Standing Committee.

"Since 1975, this relationship has come a long way," said Li, widely considered a rising political star among the next generation of leaders slated to assume power in five years.

"I particularly want to mention our fast growing business ties," Li told the European visitors.

Labels: amanda (07A102), international relations, trade with the EU

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