SCHWEIZER BOTSCHAFT IN BEIJING
EMBASSY OF SWITZERLAND IN BEIJING
AMBASSADE DE SUISSE EN CHINE

Der wöchentliche Presserückblick der Schweizer Botschaft in der VR China
The Weekly Press Review of the Swiss Embassy in the People's Republic of China
La revue de presse hebdomadaire de l'Ambassade de Suisse en RP de Chine
  12.2-16.2.07, No. 154  
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Foreign Policy

Chinese, Indian FMs meet for deepening strategic partnership
2007-02-13 Xinhuanet
New Delhi - Chinese Foreign Minister Li Zhaoxing met with his Indian counterpart Pranab Mukherjee here Tuesday on implementing plans to deepen strategic partnership between the two countries. During the meeting, Li said the Sino-India relations have maintained a favorable momentum of comprehensive development with the successful visit of Chinese President Hu Jintao last November and the recent meeting between Chinese Premier Wen Jiabao and Indian Prime Minister Manmohan Singh at the East Asian Summit in the Philippines. The two countries have reached the mutual understanding on how to deepen the Sino-India strategic partnership and improve the bilateral ties in the future, he said. China is willing to work with India on fully implementing the 10-point plan to deepen the Sino-India strategic partnership, which was agreed during President Hu's visit, he said. On his part, Mukherjee said the development of India-China relations is conducive to both sides as well as the regional and world peace and stability. With the landmark visit of the Chinese president and the meeting between the Chinese premier and the Indian prime minister, the two countries should realize the mutual understanding as quickly as possible in a bid to push forwards the bilateral ties, he said. The two foreign ministers also announced the formal start of a hotline between them, which was part of the 10-point plan. China and India will also open the consulates general in Kolkata, capital of east Indian state West Bengal, and Guangzhou, capital of south China's Guangdong Province, by the end of this year. Li started his four-day visit to India on Sunday. On Monday, he attended the opening ceremony of the memorial hall for Xuan Zang, a renowned Chinese monk traveling to India 1,300 years ago for Buddhism study, in Nalanda of north Indian state Bihar. On Wednesday he will kick off the China-India Friendship Year Through Tourism along with Mukherjee and Indian Tourism Minister Ambika Soni and hold talks with Mukherjee and his Russian counterpart Sergei Lavrov.

Talks herald new era of understanding
2007-02-15 China Daily
New Delhi - The foreign ministers of India, Russia and China said greater cooperation between the three countries would promote international peace yesterday. The officials also reached a consensus on trilateral co-operation on several important sectors. Foreign Minister Li Zhaoxing, India's External Affairs Minister Pranab Mukherjee and Russian Foreign Minister Sergey Lavrov told journalists at the end of a 3-hour talk in the Indian capital that their consultations were aimed at promoting business, trade and energy security among the three countries. Energy security figured prominently at the talks, with energy-starved India and China eyeing Russia's rich oil and gas reserves. [...] The "trilateral cooperation was not directed against the interests of any other country and was, on the contrary, intended to promote international harmony and understanding," the ministers said in a joint statement issued at the end of the talks. The gathering marked the second time the foreign ministers of the three countries had met in the past two years. They last met in Vladivostok, Russia, in June 2005. Prime Minister Manmohan Singh, Russian President Vladimir Putin and President Hu Jintao held their first trilateral summit meeting in St. Petersburg, Russia in July. The three ministers also discussed the fight against terrorism and drug trafficking, Middle East conflict resolution, the situation in Iraq and Afghanistan and the nuclear issues concerning Iran and Democratic People's Republic of Korea (DPRK). The three foreign ministers also emphasized their "strong commitment" to "multilateral diplomacy". [...]They also called for regional conflicts to be resolved peacefully. [...] All three countries called for reform within the United Nations to allow the global body to more effectively tackle conflicts between and within states and the threat posed by international terrorism. The three-way consultations between China, India and Russia were first proposed by Russia in 1996, and past meetings have focused on issues such as global terrorism, drug trafficking and energy security. Also yesterday, Li Zhaoxing met with India's Prime Minister Singh, and the two discussed issues of mutual interest. The meeting came a day after Li and his Indian counterpart Mukherjee agreed to set up a direct hotline between their offices in a bid to improve mutual trust. The hotline is listed in the 10-point plan that President Hu and Prime Minister Singh agreed upon last November to deepen the Sino-India strategic partnership. Li started his four-day visit to India on Sunday. On Monday, he attended the opening ceremony of the memorial hall for Xuan Zang, a renowned Chinese monk who traveled to India more than 1,300 years ago to study Buddhism in Nalanda, in the northern state of Bihar. Li also kicked off the China-India Friendship Year Through Tourism along with Mukherjee and India's Tourism Minister Ambika Soni yesterday.

Chinese, U.S. presidents talk on phone on bilateral ties, nuclear issue on Korean Peninsula
2007-02-15 Xinhuanet
Chinese President Hu Jintao and his U.S. counterpart George W. Bush on Thursday exchanged views in a telephone conversation on bilateral ties and the nuclear issue on the Korean Peninsula. [...] President Hu also said China is willing to maintain close communication and cooperation with the United States and other parties concerned and willing to continue to play a constructive role in fully implementing the join document and the joint statement issued at the last round of six-party talks in Sept. 2005, in helping substantially advance the denuclearization process on the Korean Peninsula and in realizing a lasting peace and stability on the Peninsula and in Northeast Asia. [...] The United States is willing to continue to cooperate closely with China to promote the implementation of the joint document, Bush said. Bush also expressed the hope that the two countries can continue to strengthen cooperation on major issues of common concern. [...] Stressing the year 2007 is an important year in the development of the Sino-U.S. relations, Hu said China is willing to work together with the United States to enhance dialogue and cooperation in various fields, to deepen strategic mutual trust and to safeguard the peace and stability across the Taiwan Straits, to guarantee the constructive and cooperative relations between the two countries will move forward in a sustainable, healthy and stable manner.[...]

Chinese FM meets with senior Japanese officials
2007-02-15 Xinhuanet
Visiting Chinese Foreign Minister Li Zhaoxing met Thursday with Japan's House of Representatives Speaker Yohei Kono, Chief Cabinet Secretary Yasuhisa Shiozaki and New Komeito president Akihiro Ota separately in Tokyo. [...] The bilateral ties are moving towards a positive direction in general and will meet new development opportunities, he [Li] said. This year marks the 35th anniversary of the normalization of China-Japan diplomatic relations and Premier Wen Jiabao will pay an official visit to Japan in April, Li noted, adding that China is ready to work with Japan to ensure the success of the upcoming top level visit. During his meetings with the senior Japanese officials, Li said that this year is also the 70th anniversary of the Lugouqiao (Marco Polo Bridge) Incident. He said that issues related with history or China's Taiwan should be appropriately treated to maintain a good political basis for the Japan-China relations. Kono, Shiozaki and Ota agreed with Li on his comments over bilateral relations. They said that they welcome Premier Wen's visit and will make efforts to ensure the success of the visit. The Japanese government will honor the joint communique between the two countries in handling issues related with history or China's Taiwan, they said. The two sides also exchanged ideas over East China Sea issue, environment and energy cooperation, youth exchange, international issues and other matters of mutual concern. At Japanese Foreign Minister Taro Aso's invitation, Li arrived in Tokyo on Thursday morning to start his visit in Japan.

China, Japan pledge to strengthen defense exchanges
2007-02-12 Xinhuanet
Chinese Defense Minister Cao Gangchuan met here Monday with visiting former Japanese director-general of Defense Agency Nukaga Fukushiro, vowing to strengthen bilateral defense cooperation. [...] Cao also briefed Nukaga on China's defense policy and position on the Taiwan issue, saying China's defense policy is defensive in nature. Nukaga, member of the House of Representatives, [...] noted that the Japanese government has always supported the one-China policy. Also on Monday, Nukaga met with Sheng Huaren, vice-chairman of the Standing Committee of the National People's Congress, China's top legislative body, and Wang Jiarui, head of the International Department of the Central Committee of the Communist Party of China, respectively. [...] Nukaga is here as guest of China Institute for International Strategic Studies.

Chinese FM says President Hu's African tour successful
2007-02-11 Xinhuanet
Chinese President Hu Jintao's eight-nation African tour was a great success in promoting friendly and cooperative ties between China and Africa, Foreign Minister Li Zhaoxing said on Saturday. [...]The trip, which began on Jan. 30, has taken the Chinese president to Cameroon, Liberia, Sudan, Zambia, Namibia, South Africa, Mozambique and Seychelles. Li said the China-Africa friendship is deep-rooted and forged in years of mutual support. It is symbolized by Tazara, a railway linking the land-locked Zambia with a port in Tanzania in the 1970s. It is reflected in warm feelings between Chinese medical teams in Africa and their patients. It is embodied by African nations' steadfast support for the restoration of China's legal rights in the United Nations. [...] President Hu also promised that the Chinese people will never impose its ideology, social system or mode of development on others and will never do anything detrimental to the African people and their countries. [...] During his African visit, President Hu briefed African leaders on China's efforts to carry out the eight steps unveiled during the FOCAC. [...] During the trip, more than 50 cooperation agreements were signed, most of them involving ways of implementing the outcome of the FOCAC, the Chinese minister said. The eight steps include China's pledge to double its assistance to Africa by 2009. China will provide 3 billion U.S. dollars of preferential loans and 2 billion dollars of preferential buyer's credits to Africa. China will also establish a development fund of 5 billion dollars to encourage Chinese firms to invest in Africa. Debt cancellation is among other major steps. At the the Beijing Summit of the Forum on China-Africa Cooperation, Chinese and African leaders unanimously agreed to forge and develop a new type of China-Africa strategic partnership featuring political equality and mutual trust, economic win-win cooperation and cultural exchanges, Li said. [...] China will join hands with Africa in seriously implementing the outcome and consensus reached at the Beijing summit, enhancing political mutual trust, expanding economic and trade cooperation, strengthening personnel and cultural exchanges, and deepening cooperation in international affairs, so as to push the development of China-Africa relations to a higher level and wider scope, Hu said. [...]

Beijing dismisses fears of an arms race - Concerns surrounding missile test in space and development of new Jian-10 fighter jet played down by general
2007-02-16 SCMP
China's recent anti-satellite missile test and the development of a new generation of jet fighters do not signal the start of an arms race, according to Major-General Zhang Bangdong , head of the Defence Ministry's Foreign Affairs Office. In a rare interview with the Guangzhou-based Nanfang Weekly newspaper that appeared to be part of a publicity drive to counter western criticism of China's lack of military transparency, General Zhang said many people had misunderstood China's defence policies. Although China lacked an aircraft carrier, General Zhang said it still "needed the corresponding military strength" to defend its long coastline, marine resources and sovereignty at sea. He acknowledged that foreign countries had expressed concern over the development of the Jian-10 jet fighter and the recent missile test in space. However, he stressed that they did not mean that Beijing wanted an arms race. Instead, he said, China was willing to work with foreign countries and would not be an aggressor. "China always supports the policy of peaceful development in space and is against the militarisation of space," he said. "Our position has not and will not change." Foreign governments including the United States and Japan have voiced concern over China's destruction of one of its defunct weather satellites with a ground-based ballistic missile last month. Defence Minister Cao Gangchuan recently told a Japanese visitor that China had no plans to conduct more missile tests in space. In his interview, General Zhang dismissed rumours that China wanted to establish a military base in the Indian Ocean by improving ties with Myanmar. He also defended the People's Liberation Army's growing budget - which will again be put under scrutiny at next month's annual meeting of the National People's Congress - saying much of the increase was spent on salary and equipment upgrades. "If each of our soldiers is paid 1,000 yuan more a month, you can calculate how much we need for all our 2.3 million troops." He said the PLA's international peacekeeping commitments also required extra funding. "The world is not at peace yet, so China needs a strong military to protect its sovereignty," General Zhang added. Milton Liao Wen-chung, a Taiwanese expert who specialises in PLA research, said he believed the interview was an attempt by China to clarify speculation on military websites and in the media. "[The conjecture is] partly because of the lack of transparency of the PLA," Mr Liao said. "And it is also true that much of the speculation circulated is not true." For example, Mr Liao said there were rumours that China had already built an aircraft carrier in Shanghai. Overseas reports, meanwhile, claimed that China had not built one because it lacked maintenance capabilities.

 

Domestic Policy

Beijing's blueprint for future aims high - Five-decade development plan plots paths for all facets of national growth
2007-02-12 SCMP
Beijing yesterday released a large-scale blueprint for the country's sustainable development over the next five decades, setting high goals for nearly every aspect of national growth. "China aims to enter the world's top 10 countries in terms of comprehensive national power by 2050," according to the plan drawn up over 32 months by the country's leading research institute, the Chinese Academy of Sciences, Xinhua reported. The ambitious Blueprint for China's Sustainable Development comprises 20 books covering a wide range of topics, including population, natural resources, the environment, economics, society, science and technology, poverty, culture and education, Xinhua said. Most noticeably, the blueprint predicts the world's most populous country will have eradicated poverty by 2050. According to previous official reports, by the end of 2005, the rural population living in absolute poverty had been reduced to 23.7 million. However, non-governmental organisations have estimated that more than 80 million mainlanders still live below the government's poverty line of less than 668 yuan a year. The development plan also vows to lower the country's Gini coefficient - a measure of inequality in income distribution - to between 0.35 and 0.40 by 2050. The country's current Gini index stands at 0.496, up 2.6 percentage points from the year before, according to an official yearbook released in December. A coefficient higher than 0.4 is considered a warning sign of social unrest. Responding to mounting concern over the country's insatiable appetite for energy and the adverse environmental impact brought about by high energy consumption, the plan promises to increase energy efficiency - or the economic rate of return on its consumption of energy. By 2050, the number of economic units of gross domestic product produced by each unit of energy would grow 15 to 20-fold, it said. This target is largely in line with the goal set in the 11th Five-Year Programme (2006-10) to reduce the amount of energy used per unit of GDP by 20 per cent, equivalent to a 4 per cent reduction each year. Despite that target, the mainland saw an increase in energy consumption per unit of GDP of 0.8 per cent in the first half of last year and emissions of major pollutants have continued to rise, according to figures from the National Development and Reform Commission. Regarding quality of life, the blueprint promises to boost its human development index - a means of measuring national well-being by taking into account factors such as life expectancy, literacy, education and standard of living - to above 0.900, which is the rating for a highly developed country. However, this appears to be a tough task given that the country scored 0.768 - coming 81st of 177 countries tracked by the index - in the United Nations' 2006 Human Development Report.

Contribute to harmony, religious groups told
2007-02-13 SCMP
Top Communist Party leader Jia Qinglin urged the country's religious groups yesterday to maximise the "positive role" of religion in boosting social harmony, Xinhua reported. Mr Jia, chairman of the Chinese People's Political Consultative Conference, said during a meeting with religious leaders in Beijing that religion could play an important role in building "a harmonious society" - a watchword for President Hu Jintao's administration. Fu Tieshan , the ailing Catholic bishop of Beijing and chairman of the Chinese Patriotic Catholic Association, attended the meeting along with leaders of other religions including Buddhism, Taoism, Islam and Protestantism. In a growing sign that Beijing is turning to religion as part of its political campaign to ease social tensions, Mr Jia urged religious groups to regard boosting harmony as an important part of their work and search for ways for religion to serve society and the people. During the past year, the central government has shown rare enthusiasm for organising religious forums, once considered "opium of the masses" under orthodox communist doctrine. During the meeting, Mr Jia advised religious groups to "make a conscious effort to interpret the religious doctrines in a way that can promote social development". "Positive elements [from the religious doctrines] that can help enhance social harmony should be promoted, while those negative influences detrimental to social harmony must be eradicated," he was quoted as saying by Xinhua. He also advised religious groups to assist the government in the handling of relations between religious and non-religious people, and people of different religious beliefs. The meeting came after the publication of a landmark research paper last week which reported that China could have three times as many religious believers as previously thought - an unsettling sign for Beijing policymakers who tend to take religion as a threat.

Hu urges non-Communists to "actively" offer political advice
2007-02-15 Xinhuanet
Chinese President Hu Jintao on Wednesday asked the country's other political parties to "actively" advise and supervise the governance of the ruling Communist Party. The great cause of building socialism with Chinese characteristics needs the joint efforts of people around the country, Hu said at an annual meeting before the Spring Festival, attended by leaders of all non-communist parties, All-China Federation of Industry and Commerce and public figures without party affiliation.The Revolutionary Committee of the Chinese Kuomintang, the China Public Interest Party and the Chinese Farmers and Workers Democratic Party are among the main political parties in China. [...]. Hu noted that the country should stick to multi-party cooperation and political consultation under the CPC leadership, a system that has been in place since the founding of the People's Republic of China in 1949. [...]

Vice Premier orders food, drug system reforms
2007-02-14 People's Daily Online
Chinese Vice Premier Wu Yi on Tuesday asked China's food and drug authorities to improve anti-graft measures and remove administrative loopholes to repair their battered image. [...] Wu ordered the SFDA to focus on five tasks this year, centering around regulating the use of executive power: -- reform the food and drug approval mechanism to make sure that the processes of accepting, appraising and approving new drug applications are carried out separately; the system of job responsibility and accountability should be enhanced; -- cut government red tape, including the process of approving new drugs and medical equipment; -- improve supervision and restrictions on administrative power; -- strengthen anti-graft measures; -- improve capacity building of leaders and officials. [...]

Senior official: "new social stratum" playing important role in China's development
2007-02-14 Xinhuanet
The Chinese government has publicly praised the contribution of private entrepreneurs, small-business owners and managerial-level staff in private or foreign-funded enterprises to the country's economic development. It considers 50 million such professionals as members of a "new social stratum", who possess or manage capital totaling 10 trillion yuan (about 1.3 trillion U.S. dollars). "This 'new social stratum' accounts for more than half of the country's technical patents, contributes nearly one third of the country's total tax revenues and provides jobs for more than half of the total number of job-seekers each year," Chen Xiqing, deputy head of the United Front Work Department of the Communist Party ofChina (CPC) Central Committee told the People's Daily. [...] Some members of the so-called "new social stratum" have already been elected as deputies of the National People's Congress (NPC) and members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC). Other professionals have been recommended to work as prosecutors and auditors in judicial and governmental departments. The concept of a specific "social stratum" harks back to the 1960s and 70s when Chinese society was clearly divided into five strata - farmer, worker, intellectual, cadre and soldier.

 

Migration

CASS report: number of overseas Chinese up to 35 mln
2007-02-12 Xinhuanet
The number of overseas Chinese has reached 35 million, making it the largest migrant group in the world, according to a report by the Chinese Academy of Social Sciences (CASS). The Report on International Politics and Security said that overseas Chinese have been living and working in 151 countries, with Australia, European and North American countries their main inhabited areas. Overseas Chinese are usually employed in construction, farming and deforestation sectors or run their own businesses in retail, real estate and importing. [...] Li Xiaoli, one of the main researchers who compiled the report, said that the immigration rushes have been stimulated by the globalization of the world economy, as well as the further opening up of China. "Relatively higher incomes in developed countries have attracted migrants from developing countries. And as many developed countries suffer low birth rates and population aging problems, the Chinese mainland migrants fill the gap," Li said. [...] Immigration has helped relieve the burden of employment in China. However, it has also led to a brain drain in the country as many students and professionals have.

 

Human Rights

Fugitive smuggler will not be executed: Beijing
2007-02-14 SCMP
Beijing yesterday assured Canada that it would not execute alleged smuggling kingpin Lai Changxing if he was sent back to China. Gan Yisheng , a vice-secretary of Central Commission for Discipline Inspection, told a news conference that China would not execute or torture Lai if Canada agreed to his extradition. Following reports last weekend of a row between Canada and China over human rights, Mr Gan stressed that the central government always honoured its commitments. "China is a big and responsible country which honours its word," Mr Gan said, adding that many of Lai's associates, including Lai's younger brother, Lai Changtu , had had their jail terms reduced. "I hereby assure you that the lawful rights of all the relative criminal suspects in the Lai Changxing case have been protected, and their dignity respected," Mr Gan said. Lai Changxing, the former boss of the notorious Yuanhua Group in Xiamen , has been fighting a seven-year battle to stay in Canada. In arguing against extradition requests made by China, Lai has said that the central government could not be trusted and his safety would be at risk if he was sent back to China. His elder brother, Lai Shuiqiang, died in a mainland prison in October 2002. His case has become a point of tension between Canada and China. Ties between the two countries have been further strained since Stephen Harper became prime minister early last year. At the weekend, Mr Harper again warned Beijing not to expand their human rights row into bilateral trade and to keep trade deals fair and above board. Zhang Shuyi , a professor at the China University of Political Science and Law, said Lai's concerns were understandable. "His case involved too many important people," he said.

Pledge by Aids activist fails to lift house arrest
2007-02-16 SCMP
An elderly Aids activist said yesterday that she remained under house arrest despite abandoning plans to travel to the United States to collect an award, but vowed to keep exposing the spread of the disease. Gao Yaojie helped bring to light the spread of Aids in her home province of Henan , where during the 1990s commercial blood stations often controlled by officials spread the HIV virus among poor farmers eager to sell their blood. No senior officials have been prosecuted or publicly castigated for the scandal. Dr Gao said on Wednesday she promised not to go to Washington and asked her sister, who lives in Los Angeles, to collect the award. "I had no choice. I had to consider my family and the threats to them," Dr Gao said, using a phone restored only after she agreed not to go to Washington. Four police officers remained on guard outside her apartment in Zhengzhou , Henan's provincial capital, yesterday morning. "I think they'll keep me detained until March," she said. "They don't want me to talk about Aids, especially to foreigners. But if we don't speak about it, Aids will keep spreading, and I'm worried about how it's still spreading through blood transfusions." Vital Voices and the US State Department have expressed concern about Dr Gao's detention. Officials in Zhengzhou have refused to answer questions about her. On Monday, Dr Gao was visited by the deputy Communist Party boss of Henan, Chen Quanguo. The official People's Daily website reported that Mr Chen came "bearing the solicitations and good wishes for the Lunar New Year of the party and government". Mr Chen thanked Dr Gao "for her contributions to the province's educational, health and Aids prevention and control work", the report said. Dr Gao's account of the official's visit was quite different. She said Mr Chen denied encountering Aids sufferers in the rural province, where even official counts say there are more than 25,000 cases.

 

Taiwan

Mainland spokesman condemns Taiwan authority's de-sinicizing moves
2007-02-14 People's Daily Online
Mainland spokesman condemned Taiwan authority's "de-sinicizing" moves in Beijing Wednesday. Taiwan authority's "de-sinicizing" moves, the separatists' moves are unable to win people's support, said spokesman for the Taiwan Affairs Office of the State Council here Wednesday. Recently, Taiwan authorities headed by Chen Shui-bian has promoted a series of "de-sinicizing" separatists' moves, aiming to create the social climate for the "de jure Taiwan independence" scheme, Li said. These moves aggravated antinomy between ethnic groups of Taiwan and stirred tension of relations across the Taiwan Strait, he said, stressing Chen attempts to seek his personal benefits from these evil conducts. [...] Taiwan leader Chen Shui-bian announced on Feb. 8 that the authorities will remove the words "China" or "Chinese" from the island's "government-run" organizations, enterprises and from certain laws and regulations. Last month, Taiwan authorities adopted a resolution that requires the island's National Palace Museum to remove all the labels that identify exhibits as being from the Chinese mainland. The move triggered widespread criticism from both mainland and Taiwan scholars.

Beijing silent on indictment
2007-02-15 SCMP
Beijing avoided direct comment yesterday on the indictment and resignation of Taiwanese opposition leader Ma Ying-jeou, although the news was widely reported by mainland media. Speaking yesterday, Taiwan Affairs Office spokesman Li Wenyi sidestepped questions about Mr Ma's troubles. "We have noticed that," Mr Li said, when asked to comment on Ma's indictment. He also would not comment on speculation over the Kuomintang leadership. Beijing has been more cautious in recent years in commenting on Taiwan's affairs to avoid fuelling cross-strait tension. [...]

Mainland opposes Taiwan authority's revision of history textbooks
2007-02-15 Xinhuanet
The Chinese mainland has voiced firm opposition towards Taiwan authority's revision of history textbooks that plays down the Nanjing Massacre or neglect it in certain versions. "Nanjing Massacre was a monstrous crime committed by Japanese militarists against the Chinese people," said Li Weiyi, spokesman for the Taiwan Affairs Office of the State Council, at a routine press conference here on Wednesday. [...]He said history textbooks of senior high schools in Taiwan should pass on the objective and true history to the next generation in Taiwan. [...]

 

Economy

Chinese finance minister discusses world economy with G7 in Germany
2007-02-11 People's Daily Online
Chinese Finance Minister Jin Renqing on Saturday delivered a speech to his G7 counterparts and bank chiefs, focusing on world economic situation and the global economic imbalance. In his speech at the discussion, Jin briefed the participants on the current economic situation in China and its major features. Governor of the People's Bank of China Zhou Xiaochuan also attended the meeting. Jin stressed that China will continuously implement macro-adjustment policies, stimulate domestic demand and conduct financial structure reforms, adding that his country will work together with others to promote the orderly adjustment of the global economic imbalance. In their discussion, the ministers and bank chiefs urged major economies to strengthen policy dialogues to reduce the risks of world economy and financial markets, according to the Chinese delegation. On Friday, Jin and finance ministers from India, Brazil, South Africa, Russia and Mexico discussed the development of bond markets in emerging economies and trade issues. The ministers urged the resumption of the Doha round of trade negotiations, which are very important for rebuilding multilateral trade system, the stable development of world economy and poverty reduction. Jin told his counterparts from the five nations that developing bond markets in the emerging economies will help build their domestic capital markets and adjusting the global economic imbalance. However, he noted that setting up bond markets is a gradual process, calling on the industrialized nations to provide technical aid to the emerging economies and help them improve their institutional capability. The developed countries should also implement responsible macro-policy and work with the International Monetary Fund (IMF) and other international monetary institutions to monitor the short-term speculative capital to ensure international financial stability, creating a good environment for the emerging economies, Jin said. Speaking of the Doha Round trade talks, Jin urged the developed economies to realize the special treatment for the developing economies, stressing that this round is for development. Finance ministers and central bank chiefs from the Group of Seven industrialized nations on Friday opened the two-day meeting, which will focus on the development of capital markets in emerging market economies and other world economic issues and fiscal policy, including consolidating macroeconomic stability, and the role of hedge funds in the stability of international financial markets. [...]The meeting in Essen is one of several meetings that will lead to the G-8 summit in the German Baltic Sea resort of Heiligendamm.

US Treasury names US-China point man
2007-02-14 China Daily
Washington - US Treasury Secretary Henry Paulson is setting up a telephone hotline connecting him directly with a vice premier of China and naming a new deputy to oversee high level talks amid agitation in congressional quarters for a tougher line with Beijing on trade issues. Paulson's announcements came on the same day the U.S. government reported that the United States trade deficit set a record for a fifth consecutive year and the imbalance with China soared to the highest level ever for an individual country. [...]. Alan Holmer, an executive of a pharmaceutical company and a former trade official during the Reagan administration, was tapped to be Paulson's deputy in charge of the strategic dialogue talks. The first high-level talks were held in Beijing in December and Paulson said the second round would occur May 23-24 in Washington. Paulson is also scheduled to travel to China in early March, his third trip to China as Treasury secretary. He will give a speech in Shanghai urging the Chinese government to allow U.S. financial firms to operate more freely in the country. [...]In response to the new deficit, Sens. Byron Dorgan, Sherrod Brown, and Lindsey Graham said Tuesday they were introducing legislation that would strip China of its permanent normal trade status with the United States and subject the trade relationship between the two countries to an annual review by Congress. Congress granted China permanent normal trade status in 2001 as part of the country's membership that year in the World Trade Organization. But the three senators said revoking the permanent trade status would give the United States more leverage to force China to abide by global trade rules. [...]

China must improve its macro-economic measures: CPC leadership
2007-02-15 Xinhuanet
China will rely more on legal and economic measures to rein in its fixed assets investment and lending, according to a press release from the Communist Party leadership on Thursday. At a conference to discuss the central government's work report, the Political Bureau of the Central Committee of the Communist Party of China agreed that the government should look for ways to improve and strengthen macro-economic measures to regulate economic activities. [...]The conference, chaired by Chinese President Hu Jintao, decided that the macro-economic measures should focus on tightly regulating the fixed assets investment and the scale of bank loans. And both the central and local governments should be mobilized in heading towards the same goal, with policies drawn up by the central authorities being fully implemented across the country, it said. Despite the government's cooling measures, China's gross domestic product (GDP) surged by 10.7 percent year-on-year to reach 20.94 trillion yuan (2.7 trillion U.S. dollars) last year. It was the fourth straight annual double-digit growth rate, driven by hefty investment and rocketing trade, both of which registered a 24 percent year-on-year growth. The economy grew 10 percent in 2003, 10.1 percent in 2004, and 10.4 percent in 2005

Trade surplus rises despite effort
2007-02-13 China Daily
The trade surplus hit $15.88 billion in January, piling pressure on the government which has made it a priority this year to reduce the imbalance. The figure was a 65 percent rise year-on-year, although it dropped markedly from $21 billion in December, according to the General Administration of Customs. Officials attributed the year-on-year increase to seasonal factors and because Spring Festival, which sees considerably less trading businesses, was in January last year. The government has taken a series of measures to stop the surplus from widening. It has not only prohibited processing trade and scrapped export tax rebates in some high-pollution and energy consuming sectors, but also provided tax rebates to imports of parts and materials for key equipment. The impact of these measures is expected to gradually materialize this year. The increasing surplus has resulted in a testy relationship with some key trading partners such as the United States and the EU. Washington has filed a complaint to the World Trade Organization claiming that the Chinese government grants industrial subsidies to exporters. [...] Total trade volume reached $157.36 billion last month, up 30.5 percent year-on-year. Imports rose 27.5 percent to $70.74 billion, and exports increased 33 percent to $86.62 billion. The European Union, the United States and Japan remain the top three trade partners of the country while India surpassed Canada to become the 10th biggest. Processing trade increased 25.7 percent year-on-year to $70.7 billion while general trade increased 33.2 percent to $71.12 billion.

Dependency on foreign oil up in '06
2007-02-13 China Daily
China imported 47 percent of its oil needs in 2006, an increase of 4.1 percentage points from the previous year, state media said Tuesday, as the country's thirst for energy supplies grew with the breakneck speed of its economy. [...] China produced 183.68 million tons of crude oil in 2006, up 1.7 percent from the previous year. Net oil imports reached 162.87 million tons, up 19.6 percent, Xinhua said. [...]

WB: China's economy to grow fast, face more external imbalance
2007-02-14 Xinhuanet
The World Bank said here Wednesday that China's economy may still enjoy favorable prospects in the near time, with a possible high growth rate of 9.6 percent this year. It also warned in its latest China Quarterly Update that the country must cultivate new sources of growth to rebalance its economic expansion. [...] China's economic growth eased slightly in the second half of 2006 as investment cooled in response to tightening measures. However, as exports continued to outpace imports by a wide margin, the impact on overall growth by a cooling investment was largely offset. As a result, China's external surplus reached new highs, while foreign reserve accumulation continued apace. Surging stock prices prompted government measures to slow new funds moving into the stock market, noted the report. China's exporters and manufacturers have been affected by several recent policy measures to rebalance the economy, including tax measures and appreciation, and more such measures are likely to follow. But continued productivity growth and a resilient world economy promise only a minor export slowdown, warns the update. Domestically, the fundamental drivers of investment remain, and investment is therefore unlikely to slow drastically in 2007, while boosting consumption will remain challenging, particularly in rural areas. The World Bank report says China's external imbalance is unlikely to shrink much in the near term, and considers a significant surge in inflation "unlikely". The Quarterly Update also deliberate upon the possible influence of China's third national financial work conference held in January, which set out directions for future financial sector reform in the key areas of rural finance, foreign exchange management, and policy banks. On rural finance, it was decided to reduce the access thresholds for financial institutions to attract a more diverse set of providers and to continue the reforms of the Agricultural Bank of China. The Quarterly notes that rural finance would also benefit from interest rate liberalization and further reforms in existing providers.

EU trade experts seek to drop China duties
2007-02-15 China Daily
Brussels - Trade experts in Brussels have recommended the European Union drop anti-dumping duties on imports from China of frozen strawberries and of energy-saving light bulbs, an EU official said on Wednesday. Scrapping the duties could help smooth EU-China trade ties which were strained last year when the bloc hit leather shoes made in China, as well as Vietnam, with anti-dumping duties. Last October, the EU imposed provisional duties of up to 34.2 percent on Chinese frozen strawberries after complaints from EU producers, mainly in Poland, about unfair competition. But trade specialists at the bloc's executive Commission have proposed the duties should not be made definitive, meaning they could be dropped from April, the EU official said. [...]The recommendation is being debated within the European Commission and would have to be approved by EU countries. [...]The Commission has also recommended that anti-dumping duties introduced for five years in 2001 on energy-saving light bulbs made in China should not be renewed, the EU official said. [...] EU trade chief Peter Mandelson has launched a review of the the bloc's anti-dumping rules, asking whether they should be reformed to reflect growing interests of EU companies which have invested in China as well as those of manufacturers in Europe.

 

North Korea

Six-Party nuclear talks yield breakthrough
2007-02-14 China Daily
The Democratic People's Republic of Korea (DPRK) yesterday agreed to shut down and seal its nuclear facility in Yongbyon within 60 days in exchange for energy a process widely seen as a major breakthrough. Under the deal reached at the Six-Party Talks to denuclearize the Korean Peninsula, Pyongyang will as the first step also accept monitoring from, and verification by, the International Atomic Energy Agency within the timeframe. In return, it will receive an initial 50,000 tons of heavy fuel oil or equivalent of economic and humanitarian aid, Wu Dawei, the chief Chinese negotiator, said in Beijing yesterday. The DPRK will subsequently take complete measures to irreversibly "disable" its nuclear programs and receive 950,000 tons of fuel oil, or the equivalent in the form of economic or humanitarian aid, from China, the United States, the Republic of Korea (ROK) and Russia. The 1 million tons of fuel would be worth around $300 million at current prices for Asian benchmark high-sulphur heavy fuel oil, which is used in power stations, shipping and elsewhere. The joint agreement outlining the initial actions the DPRK will take to end its nuclear drive and the economic rewards it will receive in return was reached after five days of hard negotiations. All the parties agreed to take coordinated steps to implement the joint statement of September 19, 2005 in a phased manner in line with the principle of "action for action". Under that agreement, Pyongyang pledged to give up its nuclear program in exchange for energy aid and security guarantees. According to the new agreement, bilateral talks will start between the DPRK and the United States, and between the DPRK and Japan, to find ways to resolve bilateral disputes and move toward diplomatic relations. Washington will also begin the process of clearing the DPRK from a list of state sponsors of terrorism. The initial actions also cover the establishment of five working groups within 30 days on denuclearization, normalization of DPRK-US and DPRK-Japan relations, economic and energy. [...]

More countries welcome joint document reached at six-party talks
2007-02-15 Xinhuanet
Britain, Canada, Singapore and Thailand have expressed welcome for the joint document issued at the end of the six-party talks on the the Korean Peninsula nuclear issue in Beijing on Tuesday. Under the document, the DPRK will shut down and seal the Yongbyon nuclear facility, including the reprocessing facility, and invite International Atomic Energy Agency (IAEA) inspectors to return to monitor and verify their actions. The parties agreed to the provision of emergency energy assistance to the DPRK in the initial phase, and assistance equivalent to 50,000 tons of heavy fuel oil will commence within 60 days, according to the document. The next round of the six-party talks is scheduled to be held in Beijing on March 19.

 

Mirjam Müller
Embassy of Switzerland
 

The Press review is a random selection of political and social related news gathered from various media and news services located in the PRC, edited or translated by the Embassy of Switzerland in Beijing and distributed among Swiss Government Offices. The Embassy does not accept responsibility for accuracy of quotes or truthfulness of content. Additionally the contents of the selected news mustn't correspond to the opinion of the Embassy.
 
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