Foreign Policy

• China sends jets to Diaoyus as risk of military clash with Japan rises (SCMP)
• China publishes new maps; South China Sea islands highlighted (Xinhua)
• China aims at becoming full IRENA member (Xinhua)
• China, Indonesia establish naval dialogue mechanism (People's Daily)
• PLA officials say troops are to prepare for war amid territorial disputes with Japan (SCMP)
• China urges Central African Republic stability (Xinhua)
• Mainland reaffirms opposition to U.S.-Taiwan arms sales (Xinhua)
• China welcomes Iran's nuclear weapon ban stance (Xinhua)
• China condemns violence in Syria (Xinhua)
• Former Japanese PM apologizes for wartime crimes in China (Xinhua)
• Beijing rebukes Myanmar after artillery shell lands in China (SCMP)

Domestic Policy

• Regions make gaokao change (Global Times)
• Cancer increasing on the mainland (SCMP)
• China's power consumption slows in 2012 (Xinhua)
• Cities react to outrage over air pollution (Global Times)
• China's high-speed railway boom to continue (China Daily)
• China's Internet users reach 564 mln (Xinhua)
• China to reward food and drug whistleblowers (Xinhua)
• China gift crackdown hits watches and booze but foreign brands hold on (SCMP)
• Family planning stands pat (China Daily)
• Li Keqiang warns fighting pollution will 'take time' (SCMP)
• Report says sick chickens sold (China Daily)
• Mourners honour ousted premier Zhao Ziyang on anniversary of death (SCMP)
• Official says stability behind cremations (Global Times)

Beijing

• China approves new US$11.2b Beijing airport (SCMP)
• Beijing leads nation on rich list (China Daily)
• Pollution at record high as toxic smog hangs over Beijing for almost a week (SCMP)

Shanghai

• Petrochemical leak pollutes Shanghai port (Xinhua)
• Govt cars cited 193 times in 3 months (Global Times)
• Industry ordered to curb emissions (Global Times)

Guangdong

• Crude oil leak contained in Guangdong (China Daily)
• Guangdong orphanage's misuse covered up with children from temple (SCMP)
• Guangdong party chief Hu Chunhua vows to stick with existing policies (SCMP)

Tibet

• Tibetan man burns to death in Gansu, first self-immolation in China this year (SCMP)

Hongkong

• Christians in prayer rally to fight gay law proposal (SCMP)
• Beijing concerned about national identity in Hong Kong youth (SCMP)
• Chief executive declares his priorities for helping an overcrowded city (SCMP)

Macau

• Macau sees only 0.3pc rise in visitors but record gaming revenue (SCMP)

Taiwan

• Taiwan considers shipping water from mainland as ties improve (SCMP)
• Taiwan gears up for military drills to counter any mainland threat (SCMP)
• Taiwan sees record number of births in 2012 (Xinhua)

Economy

• Rising veg prices push up inflation (Global Times)
• China steps up opening of markets with tenfold boost to foreign investors (SCMP)
• FDI growth drops for first time in 3 years (Global Times)

DPRK and South Korea

• Pyongyang told Beijing about third nuclear test, report says (SCMP)
• DPRK calls for UN Command dissolution, peace treaty (Xinhua)

Mongolia

• Mongolia to build first oil refinery by 2015 (Xinhua)
• China, Mongolia to deepen cooperation in mining, energy sectors (Xinhua)
• Mongolia's economy grew 12.3% in 2012 (Xinhua)
• Price of basic food commodities in Ulaanbaatar has been increased by 5.3%, compared to last month (Infomongolia.mn)
• Mongolia Draft Mining Law Threatens Investment Climate (News.mn)

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China sends jets to Diaoyus as risk of military clash with Japan rises (SCMP)
2013-01-12
The risk of a military clash between China and Japan escalated yesterday, with Beijing saying it had scrambled two J-10 fighter jets to monitor Japanese military planes near a disputed part of the East China Sea. The announcement came as Japanese Prime Minister Shinzo Abe said Tokyo's firm stance on disputed East China Sea islands, known as the Diaoyus in China and the Senkakus in Japan, was not negotiable. In Beijing, a Ministry of National Defence spokesman said that a Y-8 aircraft, belonging to the State Oceanic Administration, was patrolling airspace southwest of oil platforms in the sea on Thursday when Japan sent two F-15 fighter jets and another surveillance jet to follow the cargo aircraft at close range. That prompted the People's Liberation Army Air Force to send two J-10 jets to closely monitor the Japanese planes. "Aircraft from Japan's Self-Defence Forces have intensified their surveillance activities against China, and expanded the area of their scope, disturbing the normal patrols and training of Chinese civilian and military aircraft," the spokesman said. "This is the root cause of maritime and airspace security problems facing the two countries." Citing Japanese defence ministry officials, Kyodo News reported late on Thursday that "several" PLA fighter jets had been spotted inside Japan's "air defence identification zone", but had not violated Japan's territorial air space. Meanwhile, the defence ministry in Tokyo said Japan's Air Self-Defence Force fighters were scrambled again yesterday to head off a Chinese Y-12 aircraft near the disputed islands. Observers said it was rare for Beijing to send military jets, and the move highlighted escalating tensions. "What happened on Thursday is a potential crisis leading to a military clash between the two countries," said Antony Wong Dong, president of the Macau-based International Military Association. "Both countries find it difficult to step back, especially as Beijing regards Abe as a hawkish and aggressive leader."If the situation continues like this, it's possible that the two countries could exchange fire." [...]. ^ top ^

China publishes new maps; South China Sea islands highlighted (Xinhua)
2013-01-13
China has inked for the first time South China Sea islands on its new official maps in equal scale to that of the Chinese mainland. The new vertical-format maps of China, published by Sinomaps Press, include more than 130 islands and islets in the South China Sea, most of which have not been featured on previous maps of China, the National Administration of Surveying, Mapping and Geoinformation (NASMG) announced on Friday. The old maps, which were in horizontal format, only featured bigger islands such as the Xisha, Zhongsha and Nansha islands. These were illustrated in the bottom-right corner at half the scale used for the Chinese mainland, said Zhou Beiyan, editor of the new maps. The new maps have been published by Sinomaps Press but will not be available to the public until the end of January, according to the NASMG. The maps will be very significant in enhancing Chinese people's awareness of national territory, safeguarding China's marine rights and interests and manifesting China's political diplomatic stance, said Xu Gencai, chief editor of Sinomaps Press. Xu added that the new vertical maps have marked clearly the major South China Sea islands and demonstrated their geographic relations with surrounding island countries as well as surrounding islands and islets. In the bottom-left corner, there is also a zoomed illustration of the Diaoyu Islands, displaying their positional relations and those of their affiliated islets with the Chinese mainland and Taiwan.. ^ top ^

China aims at becoming full IRENA member (Xinhua)
2013-01-14
China announced Sunday that it aims at becoming a full member of International Renewable Energy Agency (IRENA) in 2013, a move which was widely welcomed. Currently, China has an observer status at the 148-member IRENA, which was founded in 2009 and headquartered in Abu Dhabi. The IRENA strives to increase the share of renewable energy like wind energy, solar energy, water power or energy from bio-garbage and geothermal sources by increasing the cooperation and knowledge between the member states. Speaking at the sidelines of the third annual session of IRENA, Shi Lishan, the deputy director general of the National Energy Administration in China and a member of the Chinese delegation, said that his country is looking forward to becoming a member of the UN-related agency to promote its knowledge in renewable energy to the international community. Shi said that China was investing on a large scale in renewable energy and was able to promote solar, wind and bio-energy. For his part, director-general of IRENA, Adnan Z. Amin said that Beijing's announcement to join IRENA was "fantastic and most encouraging." Amin believed that this was the best news of the assembly's first day, "because IRENA can achieve its goals better and faster if all nations sit at one table." [...] China is promoting renewable energy investments to reduce energy consumption. According to data compiled by IRENA, China's financial investments in renewable energy hit 58 percent of the combined share of the developing countries. China invested up to 52.2 billion U.S. dollars in renewable energy in 2011, representing a 17 percent year on year increase. ^ top ^

China, Indonesia establish naval dialogue mechanism (People's Daily)
2013-01-14
Qi Jianguo, deputy chief of general staff of the Chinese People's Liberation Army (PLA), and Sjafrie Sjamsoeddin, visiting deputy defense minister of Indonesia, held the 5th Defense and Security Discussion between the Defense Ministries of China and Indonesia on the afternoon of January 10, 2013 in Beijing. The two sides had an in-depth exchange of views on the regional security, the relations between the two countries and the two militaries as well as the issues of common concern, spoke positively of the exchanges and cooperation between the two militaries and jointly declared that the two sides will set up naval dialogue mechanism. Qi Jianguo said that in recent years, the two militaries have carried out constant high-level mutual visits, operated discussion mechanism well and further deepened their strategic mutual trust. The Chinese side is willing to continuously deepen the relations between the two militaries, strengthen the friendly exchange and cooperation and jointly safeguard regional peace and stability with the Indonesian side. Sjafrie Sjamsoeddin said that Indonesia attaches high importance to developing the strategic partnership with China and is willing to strengthen the friendly cooperation with China in the defense field. ^ top ^

PLA officials say troops are to prepare for war amid territorial disputes with Japan (SCMP)
2013-01-15
The PLA aims to beef up its troops' combat readiness and prepare for actual war situations through exercises this year, according to the latest annual training directive, amid escalating tensions between China and Japan over territorial disputes in the East China Sea. "In 2013, the goal set for the entire army and the People's Armed Police force is to bolster their capabilities to fight and their ability to win a war … to be well-prepared for a war by subjecting the army to hard and rigorous training on an actual combat basis," according to yesterday's People's Liberation Army Daily, which referred to a training blueprint issued by the PLA's Department of the General Staff for the entire force. The directive came in stark contrast to that of its predecessor. In last year's directive, more emphasis was placed on joint military trainings and co-ordination among different PLA services. This year's statement stresses the urgency of real combat abilities in all military training by repeating the phrase "fighting wars", or dazhang, as many as 10 times in the article, which was no more than 1,000 words. The phrase did not appear in last year's directive. The changes could be a result of the rising tensions in waters between China and Japan, while they might also indicate that there is a different focus for the PLA, since the Central Military Commission's chairman Hu Jintao was succeeded by Xi Jinping, the new PLA commander-in-chief since November. Separately, state broadcast media reported in the past week that the PLA's naval air force kicked off the open-sea training portion of its annual exercise programme. No details were given on the specific dates or duration. The General Staff department's training directive came a day after Japan's Self-Defence Forces conducted a massive military exercise on training grounds in Narashino, on the outskirts of Tokyo, on Sunday, in which 20 aircraft, 300 personnel and 33 vehicles participated. [...] Andrei Chang, editor-in-chief of the Canada-based Kanwa Defence Review, said, "The PLA is making its propaganda voice louder this year, aside from shifting their target to Japan instead of the Philippines last year," adding the statement was more or less the same as last year's. ^ top ^

China urges Central African Republic stability (Xinhua)
2013-01-15
China is hopeful that recently signed agreements can restore peace to the Central African Republic, a Foreign Ministry spokesman said on Tuesday. "We hope parties in the Central African Republic will observe and implement the agreements in a bid to help the country return to the track of stability and development at an early date," Hong Lei said at a daily press briefing. Hong's comments came days after the signing of accords between the government of the Central African Republic and rebels on Friday. Under the agreements, a new prime minister from the opposition will be named so that a national unity government can be formed to end the month-long political crisis. Legislative elections will be held within a year. Hong said China is closely following the developing situation and has noticed the signing of agreements. The spokesman said China welcomes the agreements as they have laid a foundation for a political solution to the crisis. China would like to work with the international community and make efforts to help the Central African Republic seek long-lasting peace and stability, Hong said. ^ top ^

Mainland reaffirms opposition to U.S.-Taiwan arms sales (Xinhua)
2013-01-16
A Chinese mainland spokesman on Wednesday reaffirmed the country's opposition to arms sales by the United States to Taiwan and urged the superpower to adhere to the one-China policy. "Our stance toward U.S. arms sales, as you are clearly aware, is that we firmly oppose them," Yang Yi, spokesman for the State Council's Taiwan Affairs Office, told a press conference. Responding to a Taiwanese reporter's request for comment on Taiwan leader Ma Ying-jeou's recent intention to continue purchasing U.S. weapons, Yang said, "We also hope that the U.S. strictly abides by the three Sino-American joint communiques and the one-China policy." "Cross-Strait issues have to be eventually settled by Chinese living on both sides," Yang said. "We hope that both the mainland and Taiwan make joint efforts to create a new situation for the development of cross-Strait relations, and benefit compatriots and the Chinese nation." The People's Republic of China established diplomatic relations with the United States on Jan. 1, 1979. The three joint communiques achieved by the two countries respectively in 1972, 1979 and 1982 have played a key role in normalizing bilateral ties. According to the Aug. 17 Communique made in 1982, the United States does not seek to carry out a long-term policy of arms sales to Taiwan and it intends gradually to reduce such sales to Taiwan, leading, over a period of time, to a final resolution. In reply to a question about possible joint efforts with Taiwan authorities to safeguard the Diaoyu Islands, Yang said, "The mainland has proposed that the two sides make contact at an appropriate time to discuss military issues such as the establishment of a mechanism for cross-Strait mutual trust in military security." "We will continue this effort and hope that the two sides can maintain cross-Strait peace with joint efforts," Yang said. ^ top ^

China welcomes Iran's nuclear weapon ban stance (Xinhua)
2013-01-16
China said on Wednesday it welcomes and attaches importance to Iran's latest stance of banning development of nuclear weapons. Foreign Ministry spokesman Hong Lei made the remarks at a daily press briefing here. Hong said that Iran is a signatory of the Nuclear Non-proliferation Treaty. "We hope that all relevant parties can enhance talks and cooperation, increase mutual trust, and seek a comprehensive, long-term and proper solution to the Iranian nuclear issue, with progress as soon as possible." Iran's Foreign Ministry spokesman Ramin Mehmanparast said Tuesday that a religious decree (fatwa), issued earlier by the country's supreme leader, regarding a ban on nuclear weapons is binding for the Islamic republic, and that it is ready to register it as an "international document." The Iranian spokesman's comments came a day before the new round of talks between Iran and a delegation from the International Atomic Energy Agency (IAEA) in Tehran. In February 2012, Iran's supreme leader Ayatollah Seyyed Ali Khamenei said the country considers seeking and acquiring nuclear arms as a "sin.". ^ top ^

China condemns violence in Syria (Xinhua)
2013-01-16
China condemns a deadly blast at a Syrian campus and calls on all parties to cease fire immediately, a Foreign Ministry spokesman said on Wednesday. "China condemns all violence against civilians, and is deeply saddened by the large civilian casualty caused by the blast at Allepo University," spokesman Hong Lei said at a daily press conference. The campus explosion on Tuesday killed at least 80 people and left more than 160 wounded. Both the Syrian government and the opposition have blamed each other for the incident. "Once again China urges the Syrian government and the opposition to end the violence immediately, protect civilians, follow the consensus of the Action Group Geneva Communique, push forward the Syrian-led political transition, and restore peace and stability in the country at an early date," Hong said. ^ top ^

Former Japanese PM apologizes for wartime crimes in China (Xinhua)
2013-01-17
Former Japanese Prime Minister Yukio Hatoyama on Thursday apologized for Japan's wartime crimes in China and expressed his hope that the tragedy would not be repeated. Hatoyama made the remarks while touring the Memorial Hall of the Victims of the Nanjing Massacre by Japanese Invaders in the eastern Chinese city of Nanjing. Hatoyama was the third former Japanese prime minister to visit the memorial after Tomiichi Murayama and Toshiki Kaifu. During the visit, he often stopped to pay silent tribute to photos or the remains of the victims of the Nanjing Massacre, which was committed by the invading Japanese army in the late 1930s. Hatoyama nodded as Zhu Chengshan, the memorial's president, told him that it is an undeniable fact, as stated in the verdicts of the Tokyo and Nanjing martial courts, that Japanese invaders killed more than 300,000 people in Nanjing. [...] After seeing slogans reading, "To remember the historical lesson of Nanjing, but not for revenge, and to seek eternal world peace for great love," Hatoyama said the words touched him and he hopes that all people will work hard for peace. "After the tree of peace I planted blossoms and bears fruits, I will come back again," he said at the end of a two-hour visit when he planted a ginkgo tree in a park. ^ top ^

Beijing rebukes Myanmar after artillery shell lands in China (SCMP)
2012-01-18
China rebuked Myanmar yesterday and called for an immediate ceasefire between Myanmar's government forces and ethnic minority rebels after an artillery shell flew over the border and landed inside China for the second time since late last month. Myanmar's military has stepped up shelling and air attacks on rebels in its northern Kachin state, raising doubts over assurances by its quasi-civilian government that it wants a peace deal to end the fighting that has made its way to China's doorstep. China's Foreign Ministry spokesman, Hong Lei, said the shell landed 500 metres inside China on Tuesday, close to where Myanmar's military was locked in an 18-month conflict with Kachin Independence Army guerillas. "China made immediate emergency representations to Myanmar, expressed strong concern and dissatisfaction with the situation, and demanded that Myanmar earnestly investigate and adopt a series of measures to prevent further similar occurrences," Hong said. Hong said no one was injured in the shelling, but his comments marked an escalation of China's criticism of Myanmar's government, which is led by former generals who have been praised for reforms after 50 years of strict military rule. "China calls on both sides involved in the conflict in Myanmar to … immediately implement a ceasefire … and jointly protect the peace and stability of the China-Myanmar border area," Hong said. He did not say which side China thought fired the shell, but Myanmar government forces have been using artillery to attack rebels positions on the Myanmar side of the border. The Foreign Ministry denounced a similar spill-over of the conflict on December 30. ^ top ^

Regions make gaokao change (Global Times)
2013-01-13
All provinces and regions across the country, except for Tibet Autonomous Region, have published their policies on the national college entrance examinations (gaokao) for nonlocal students, the Beijing News reported on Saturday. However, these new policies vary widely. Different plans also have different requirements in the study terms of nonlocal students. Heilongjiang Province regulated that non-locals could sit the exams in the province if they have studied for three consecutive years there and their parents have legal careers and permanent addresses in the province. Jiangxi Province only requires non-locals to have studied in high schools in the province for at least one year. A total of 11 provinces and regions including Beijing, Shanghai and Guangdong Province placed different requirements on the social security of non-local students' parents. Eight provinces have no clear requirements on parents' careers and six provinces haven't mentioned any requirements on the parents' dwelling place, according to the Beijing News. Yuan Guiren, the Minister of Education, said recently the ministry "totally understands the differences among the policies and fully respects them," the Beijing News reported. ^ top ^

Cancer increasing on the mainland (SCMP)
2013-01-13
The number of middle-aged mainlanders developing cancerous tumours doubled over the two decades to 2009, a new national report says. At the same time, the overall frequency and mortality of cancers have both risen, a development mainly ascribed to the ageing population. The 2012 China Cancer Registry Annual Report, produced by the Ministry of Health's National Cancer Registry Centre, said the prevalence of all kinds of cancers on the mainland was 285.91 cases for every 100,000 people in 2009, compared with 184 cases per 100,000 people in the late 1980s. About 3.12 million people a year - or 8,550 people a day - were diagnosed with cancers, the report said. The cancer-caused death rate was 180.54 per 100,000 people in 2009, the report said. It did not specify the mortality rate in the late 80s, saying only that it had kept rising. Dr Chen Wanqing, the lead author of the report, said last week that it would help the mainland improve cancer prevention and treatment. [...] Chen said the ageing population had pushed the cancer prevalence and mortality rate higher. "If there was no ageing influence, cancer prevalence and mortality would have remained parallel to the situation in the 80s," he said, adding that the financial burden from cancers was higher than before. [...] Chen also said mainland China's mortality rate from cancers was far higher than in the West. That was because the most common cancers in Western countries were breast cancer and prostate cancer, which had high survivability rates following surgery. On the mainland the most common cancers were lung, liver and stomach cancers, with only a small percentage of patients surviving. [...]. ^ top ^

China's power consumption slows in 2012 (Xinhua)
2013-01-14
China's power consumption in 2012 expanded at a much slower pace than a year earlier due to tempered growth in the world's second-largest economy, according to official figures released on Monday. The National Energy Administration (NEA) said in a statement on its website that electricity used last year grew 5.5 percent from 2011 to 4.96 trillion kilowatt hours (kWh). The growth rate was markedly lower than the 11.7-percent increase registered in 2011, echoing the slowdown in the country's economy last year. [...] In a breakdown, the service sector consumed 11.5 percent more electricity than a year ago, the industrial sector 3.9 percent more, while power used by the agricultural sector stayed unchanged, the statement said. The average operational time of power plants across the country with generation capacity of more than 6,000 kilowatts (kw) dropped by 158 hours to 4,572 hours last year, according to the NEA. New generation capacity added last year stood at 87 million kw, the statement said. By the end of last year, the country's total installed power generation capacity reached 1.14 billion kw, it added. China remained the world's largest energy producer for a fifth straight year in 2012, with its hydropower and wind power sectors boasting the world's highest capacities, the NEA said last week. [...]. ^ top ^

Cities react to outrage over air pollution (Global Times)
2013-01-15
Public outrage over the choking smog that has blanketed a large part of China for more than 10 days has prompted many cities to shut down factories, ban the use of officials' cars and attempt artificial precipitation. Beijing's environmental authority has ordered a temporary halt in the operations of factories owned by 58 companies, including chemical companies and car manufacturer Hyundai. They have also been asked to cut down on pollution, officials said in a media briefing on Monday. Some 30 percent of the capital's official vehicles will be banned from the roads on heavily polluted days to cut down on emissions, the Beijing Traffic Management Bureau announced. "Traffic authorities will be monitoring these banned vehicles via their database and surveillance cameras," Fang Li, deputy head of the Beijing Municipal Environmental Protection Bureau, told the press. The ban started on Saturday, when the city's PM2.5 (particles less than 2.5 micrometers in diameters) Air Quality Index (AQI) readings exceeded 700, far beyond the upper limit of 500. The US consulate in Shanghai defines PM2.5 levels of 200 to 300 as "very unhealthy," stating that young children, the elderly and those with lung conditions should stay indoors. Fang said that the carbon emissions from traffic and industrial factories, the local climate conditions, and the impact of pollution from Tianjin and Hebei Province are three major causes of the sudden deterioration in Beijing's air quality. The smog has led to record-high air pollution readings, an increasing number of respiratory disease patient admissions and disrupted traffic across the country, including areas of Hebei, Henan, Shandong, Anhui, Jiangsu and Sichuan provinces. [...] Amid public demands for more rapid government action on pollution control, several cities have released plans since the weekend. Many however, have yet to take any action. [...] Environmental and meteorological authorities in Nanjing, where the air pollution has been severe for nine days, have been trying to stimulate artificial rainfall to ease the pollution. Nanjing's environmental officials also proposed a pollution-control plan to the municipal government, suggesting the activation of temporary traffic restrictions during heavily polluted weather, according to the Yangtse Evening Post. The smog in most places will last until January 16, the National Meteorological Center said. [...]. ^ top ^

China's high-speed railway boom to continue (China Daily)
2013-01-15
About 5,209 km of new high-speed railways will be put into operation in 2013, 2,738 km more than last year, global financial services provider UBS AG forecasted. In 2012, about 250 standard sets of high-speed trains were delivered in China, and UBS projected the Ministry of Railways will place new orders for 400 more trains this year upon completion of the high-speed railway network. According to UBS estimates, 60 percent of the trains will operate on 200 km per hour speed lines, and the rest will run at 300 km per hour. “The Ministry of Railways has not signed large orders since it placed a gigantic order of nearly 100 billion yuan ($16 billion) in 2009, and the major high-speed train orders should be used up in March,” said Richard Wei, head of UBS Asia transport research. Wei estimated that about 20,463 km of high-speed railways will be in service by 2015, compared with 9,337 km at the end of 2012. To cope with the gigantic investment in railway network expansion, the Ministry of Railways must augment its financing avenues or it will face a severe capital shortage, analysts said. The ministry is already burdened with more than 2 trillion yuan in debt, and the construction nationwide of high-speed railways will put new pressure on the ministry over the next few years, Wang Mengshu, a member of the Chinese Academy of Engineering, was quoted on Monday by the Economic Information Daily as saying. Wang suggested the central government allocate more money for railway building as the railway plan is part of the State strategy. Local governments should also help finance railway projects because the new lines will boost economic development and create more jobs, Wang said. [...] A draft plan showed that 630 billion yuan will be spent on China's railway construction in 2013. ^ top ^

China's Internet users reach 564 mln (Xinhua)
2013-01-15
China added 50.9 million Internet users in 2012, bringing the total to 564 million at the end of last year, official data showed Tuesday. The mobile Internet surfing population increased 18.1 percent to 420 million, with mobile phones becoming the primary channel for Web surfing, the China Internet Network Information Center reported. The number of people using a mobile phone to shop online increased 1.36-fold in 2012 from a year ago. By the end of 2012, the number of online shoppers had reached 242 million, an increase of 24.8 percent year on year. Meanwhile, the risks of phishing websites and online fraud can not be underestimated, according to the report. Micro-blogging surged, with the number of users rising 58.73 million to 309 million, the report said. ^ top ^

China to reward food and drug whistleblowers (Xinhua)
2013-01-15
China's food and drug watchdog on Tuesday announced that it will reward people for reporting food and drug issues to authorities. Whistleblowers could get up to 300,000 yuan ($48,244) per case as a reward, according to a circular publicized by the State Food and Drug Administration (SFDA). The move aims to "encourage the public to report illegal activities so as to determine, control and eliminate potential safety risks concerning food and medicine," the SFDA said in the circular. Depending on the accuracy of information provided and intensity of a whistleblower's engagement in the investigation of relevant cases, the organization or individual behind a tip-off could receive 1 to 6 percent of the value of the food or medicine involved as a reward, according to the circular. Though a 300,000 yuan ceiling was set, the SFDA said exceptions could be made by national and provincial food and drug authorities in cases with nationwide influence. The new reward rule will replace one released on Nov 27, 2003, which only set down conditions for rewarding those who report illegalities concerning medicine and fixed the award ceiling at 50,000 yuan. ^ top ^

China gift crackdown hits watches and booze but foreign brands hold on (SCMP)
2013-01-16
A Chinese government crackdown on lavish spending by officials has pushed expensive alcohol and high-end watches out of favour in the luxury gift-giving market, a survey from the Hurun Report, known for its annual China Rich List, showed on Tuesday. Top alcohol maker Kweichow Moutai Co Ltd saw its clear ‘baijiu' liquor – widely imbibed at official banquets and presented as a premium gift – fall to 13th place on the “best brand for gifting by men” table, down from fifth last year when there was a single, mixed-gender table, according to the report. Swiss watchmaker Longines was the only watch brand to make the “gifting by men” list at number 15, replacing Rolex, which was ninth last year but dropped off the list altogether this year. The report surveyed 551 Chinese with personal wealth of 10 million yuan (US$1.6 million) or more. The results follow a government crackdown, launched in March last year, on using public funds to buy luxury items such as baijiu, which can cost several thousand yuan per bottle. In December, alcohol was banned at military events. “Watches and liquor have been influenced by government policies and have been pulled down by a change in leadership. It's traditionally been that in government there are people who can influence policy in your favour,” Hurun founder Rupert Hoogewerf told reporters. [...] Market leader Moutai had 12.5 billion yuan wiped off its market value after the new regulations were announced. Moutai's fall meant there was not a single Chinese brand in the top 10, and only one in the top 15 on the men's gift list. [...]. ^ top ^

Family planning stands pat (China Daily)
2013-01-16
China will stick with its current family planning policy to maintain the country's low birthrate but will make an effort to fine-tune it, the country's population planning chief said. Wang Xia, minister of the National Population and Family Planning Commission, made the remarks at a national conference in Beijing on Monday amid widespread speculation that the one-child rule on the Chinese mainland might soon be relaxed. "Maintaining a low birthrate remains a top priority in 2013 and beyond. But policy implementation has to fit into local situations," she said. China has maintained a low birthrate for about 20 years, said Lu Jiehua, a social demographics professor at Peking University. Many people, including academics, have called for relaxing the policy to better meet new demographic challenges such as a rapidly aging society, a skewed gender ratio and a rising labor shortage. But Zhai Zhenwu, dean of the School of Sociology and Population Studies at Renmin University of China, doesn't agree with that strategy. Zhai said China's current low birthrate is not stable and would rebound sharply in most parts of the country if the family planning policy were to be abandoned. The birthrate on the mainland was 11.93 per 1,000 in 2011, a decrease of 0.93 per 1,000 from 2002, according to the National Bureau of Statistics. China's population topped 1.34 billion by the end of 2011, an increase of more than 60 million over 2000, the bureau said. The total birthrate, the average number of children a woman gives birth to, has fallen to about 1.6, an even lower level than in some developed economies, such as the UK. [...] Most countries with a birthrate lower than 2.0 are developed countries with high levels of urbanization, social security and education, and a per capita GDP of more than $30,000, he said. In comparison, the per capita GDP of China was $5,400 in 2011, according to the International Monetary Fund. "This showed China's low birthrate is not a natural result of social and economic development," he said. [...] Because China's economic and social development still lag behind a level in line with its low birthrate, the nation's current birthrate is not stable and would certainly rebound sharply in most parts of China, except in a few large developed cities, he said. [...] "This means China will have to continue to carry out family planning policies over the long term to ease the pressure," he said. [...]. ^ top ^

Li Keqiang warns fighting pollution will 'take time' (SCMP)
2013-01-16
Vice-Premier Li Keqiang said it would take time for the government to tackle air pollution, as smog levels remained at "unhealthy" levels yesterday. Li, the first high-ranking official to comment on air pollution since a large area of the mainland was blanketed in thick smog over the weekend, also called for a change in industrial production and consumption patterns. "Pollution is not a problem that emerged only a few days ago - it's a long-term issue, and fixing it will take a long time. But we need to do something about it," Li said. He added that the government regularly releases data on health-threatening PM2.5 particles, but more law enforcement measures were needed. Air pollution fell yesterday from the "hazardous" and "beyond index" levels of previous days. The PM2.5 count in most urban areas of Beijing fell to around 200 micrograms per cubic metre due to light snowfall and because some industrial production was suspended, according to the Beijing Municipal Environmental Monitoring Centre. [...] The pollution index was slower to fall yesterday in other parts of the country, such as Jinan, about 440 kilometres south of Beijing in Shandong, where the level stayed above 400. The effects of the pollution, which authorities have called the worst in years, appear to be wide-ranging. Xinhua reported yesterday that a factory fire in Anji county, Zhejiang province, went unnoticed for more than three hours because of the smog. There were also reports of several serious accidents, including a 20-car pile-up on an expressway linking Hangzhou in Zhejiang to Pudong in Shanghai, in which two people died. A report released on Monday by Tsinghua University and the Asian Development Bank said fewer than five out of 500 mainland cities have PM 2.5 counts that meet the World Health Organisation's standard of a mean level of 25 mcg per cubic metre per 24 hours. It said economic losses from pollution were equal to 1.2 per cent of the nation's GDP. Ma Jun, director of the Institute of Public and Environmental Affairs in Beijing, said severe air pollution would continue unless authorities identify pollution sources and dealt with them. Beijing environmental authorities said it was not necessary to buy air purifiers, but the Ministry of Environmental Protection was revealed to have bought an air purifier last week, triggering a backlash from internet users. ^ top ^

Report says sick chickens sold (China Daily)
2013-01-17
A major chicken supplier in Central China has been suspected of selling sick birds to popular food chains including KFC, in the latest crisis to hit the country's poultry industry. According to a report on china.com.cn on Tuesday, several chicken farms owned by Doyoo Group in Henan province have been providing sick birds to the group, which resells the chickens to fast-food chains such as KFC and McDonald's. The report also said dead chickens were made into bone powder by the company, instead of being disinfected and buried, as regulations require. The company had not replied to China Daily's interview request as of press time on Wednesday. However, the food safety commission of Hebi city, where many chicken farms of the group are located, said an initial investigation shows the group is not involved in processing sick or dead chickens, according to a notice posted on the group's website on Wednesday. [...] The report said chickens were being raised in sealed enclosures, which were lit 24 hours a day at a constant temperature of about 36 C, to maximize their growth, which caused the birds to become sick, with many dying prematurely. A chicken farmer in Hebi surnamed Yang said that more than 7,000 chickens at the farm were sick recently, but when he contacted Doyoo to express his concern, he was ordered to send the birds for slaughter and they were later sold. The company also asked farmers to report if large numbers of chickens became sick or died, so the chickens could be slaughtered without quarantine inspection, Yang said. "Such cases happen every year," he added. [...] The State Food and Drug Administration said on Tuesday it encourages people to disclose food safety problems. Whistleblowers can be rewarded with as much as 300,000 yuan ($48,000) for reporting cases, according to an announcement. ^ top ^

Mourners honour ousted premier Zhao Ziyang on anniversary of death (SCMP)
2013-01-18
More than 100 mourners flocked to a traditional house in a quiet alleyway in Beijing yesterday morning to pay their respects at the home of the late Zhao Ziyang on the eighth anniversary of the ousted party chief's death. Zhao, a former Communist Party general secretary and premier, died at the age of 85. Before his death, Zhao had been under house arrest at the courtyard home at No 6 Fuqiang Alley since opposing the use of military force against the Tiananmen Square demonstrators in 1989. Prominent among the mourners yesterday was Hu Jia, a two-time Nobel Peace Prize nominee, who had not been able to pay his respects for the past six years because of tight surveillance by security police. He last attended in 2006. Ding Zilin, founder of the Tiananmen Mothers organisation, was also present. Hu said he sneaked out from his apartment around 6am, in disguise, when security was lax. He said security police noticed he was not at home and warned his mother that they could arrest him again. Hu was jailed in 2008 and was released from prison in June 2011. "People are talking about the changes since the new leadership took power, but I don't see much change based on my own experiences," Hu said. Zhao pressed forward with bold political reforms while in office, but he was never seen in public after May 19, 1989, when he made a tearful appeal in Tiananmen Square for pro-democracy demonstrators to leave. He has since become a symbol of thwarted political reform. [...] People who visited Zhao's home yesterday bowed in the mourning room, where a large picture of a smiling Zhao was surrounded by dozens of flowers, including ones from his former aide Bao Tong, who is under house arrest in Beijing. Wang Yannan, Zhao's daughter, said yesterday that the authorities had not tried to stop them from receiving mourners. No senior party officials paid respects to Zhao after his death, except former vice-premier Tian Jiyun. Online postings to mourn Zhao were quickly removed yesterday. ^ top ^

Official says stability behind cremations (Global Times)
2013-01-18
An official from Zhenxiong county, Yunnan Province, where a landslide recently claimed 46 lives, admitted on Wednesday that it was partially for stability's sake that the county government hastily incinerated the bodies of the victims without approval from the victims' families. Zhu Henghui, director of Zhenxiong county government administrative office, said stability played a part in the decision making process of incinerating the victims' bodies, which led to protest from local villagers, who blocked the roads and demanded an explanation on Sunday. Despite the announcement from the government claiming the landslide was a natural disaster, local villagers believe that the Gaopo coal mine, which is 500 meters from the landslide scene, is to blame for the landslide. Zhu has agreed Wednesday to let villagers, who sent a joint letter to the State Council Wednesday to demand an re-investigation, check the local coal mine after the Chinese New Year, Beijing Times reported on Thursday. Zhu could not be reached by the Global Times as of Thursday night. Hu Peiwen, deputy head of the publicity department of Zhenxiong county, told the Global Times that the local government has dispatched work teams to persuade the villagers to claim the ashes of their beloved ones. "The government's incineration of the bodies was done to prevent emotional distress to the villagers once they see them," Hu said, adding that epidemic prevention is another factor in the decision. [...] As of Wednesday night, no family member of the victims has picked up the urns from the Zhenxiong funeral house, the Beijing Times reported. [...] Despite the government assurances, Luo Yuanshou, the brother of one victim, said he still hasn't picked up his sister's ashes and that he finds the incineration highly inappropriate. "I don't understand what they mean by maintaining stability. If it is truly a natural disaster like the officials have claimed, there is no need to fear how villagers would respond. The fact that they incinerated the bodies so hastily is a sign of cover-up. I will not claim my sister's urn until I find out what truly caused the disaster," Luo told the Global Times. ^ top ^

China approves new US$11.2b Beijing airport (SCMP)
2013-01-15
Chinese leaders have given final approval for a long-awaited new US$11.2 billion international airport in Beijing to ease crushing congestion at the existing facility, state media said on Monday. The state-run China Daily newspaper reported the decision, made on Sunday, citing a spokesman for the country's State Council, or cabinet. The existing international airport, which saw a major expansion in the run-up to the 2008 Olympics, is the world's second-busiest, reflecting China's relentless economic rise. The new airport is likely to be in the south of the sprawling capital but other details including a start date for construction and its design were still being decided, the Daily said, quoting spokesman Li Shengbo. The newspaper also reported, citing the CAAC News – a paper affiliated with the country's aviation administration – that large-scale construction would begin next year, with the airport due to open by the end of 2018. CAAC News, quoting an aviation administration official, said the new airport would cost at least 70 billion yen (US$11.2 billion), with six runways for civilian aircraft and a seventh for military use. Beijing Capital International Airport, in the north of the city, has been ranked as the world's second biggest airport for three years, the newspaper said, handling 81.8 million passenger movements last year. It ranks second globally behind Hartsfield-Jackson International Airport in Atlanta in the United States. [...]. ^ top ^

Beijing leads nation on rich list (China Daily)
2013-01-15
Beijing has the largest number of rich people in China, being home to more than 100,000 high-net-worth families. This is the finding of the 2012 China Wealth Report co-released by Boston Consulting Group and China Construction Bank. The report said there are more than 200 high-net-worth families out of every 10,000 families in Beijing. Based on a survey of 1,912 individuals with household net worth of at least 6 million yuan ($950,000), the report found that Beijing, Jiangsu, Shanghai, Zhejiang and Guangdong were each home to at least 100,000 rich families in 2012, comprising 40 percent of the high-net-worth families nationwide. But China's inland regions are seeing faster growth in the number of dollar millionaires than Beijing, the report found but provided no figures. The number of high-net-worth households in Anhui, Gansu and Hunan rose by 30 percent year-on-year in 2012, but the growth rate for high-net-worth families in Guangdong and Zhejiang was below 10 percent in 2012 due to a drop in business owners' wealth, and companies' operating difficulties. Some 56 percent of the millionaires are company owners, 60 percent of whom are seeing their companies prosper with steady income and profits. The number of millionaires making their fortune from property market investment fell significantly in 2012, the report found but provided no figures. [...] The report also found that investable assets held by households in 2012 increased 14 percent year-on-year to 73 trillion yuan. The number of high-net-worth households grew by 17 percent to reach 1.74 million in 2012. ^ top ^

Pollution at record high as toxic smog hangs over Beijing for almost a week (SCMP)
2012-01-18
Chinese leaders dazzled the world by clearing the skies as if by edict before the Beijing Summer Olympics in 2008. Fast forward to January 2013, and the government seems powerless against those same skies, tarnished by an opaque, toxic cloud that has smothered the city for nearly a week. Why have conditions deteriorated so drastically? Environmentalists and analysts suggest a complex mix of causes, from an overreliance on heavy industry and an addiction to dirty coal, to poor enforcement of pollution laws, hundreds of thousands of new cars and incentives for local officials to promote economic growth at all costs. Beijing has been enveloped in smog since Friday, and the municipal government warned residents to stay indoors after pollution readings hit record rates late on Saturday. In the face of widespread public anger and rare media criticism, the government said it would force some vehicles off the road and temporarily close dozens of factories. But environmentalists say more comprehensive solutions are required. "It is really just a temporary measure, and in the longer term you really have to get at the root causes like coal-burning factories," said Ming Sung, chief Asia-Pacific representative with the US-based Clean Air Task Force. In the run-up to the Olympic Games in 2008, authorities in Beijing replaced coal with natural gas in some power stations and for indoor heating in parts of the capital. The city also temporarily shut factories and forced the biggest industrial firms to leave heavily populated districts. One of the city's flagship enterprises, the Shougang Group, relocated all its steelmaking facilities to the new port of Caofeidian in neighbouring Hebei province 200 kilometres away. But such moves simply shifted rather than eliminated pollution sources, and air quality has continued to deteriorate. "You can't tell pollution not to come over to my territory - this really needs to be nationwide," said Sung. The China Academy of Sciences estimates a quarter of the lethal PM2.5 emissions drifting across Beijing originate from beyond its borders. Efforts to tackle pollution have not been successful because most local governments, including Beijing, still identify industrial growth as their main priority, said Yang Fuqiang, a former government energy policy researcher and now senior adviser at the Natural Resources Defence Council. "The Beijing Development and Reform Commission asked me to give them ideas how to make Beijing much cleaner while still maintaining economic growth. I told them they have to change their ideas.". ^ top ^

Petrochemical leak pollutes Shanghai port (Xinhua)
2013-01-13
Improper loading resulted in a petrochemical leak that has polluted a port in Shanghai, local authorities said Sunday. Workers at the Jueshi Port failed to fully shut down a valve while loading C9, a dangerous petrochemical, onto a cargo ship around 10 a.m. Thursday, resulting in the chemical spilling into the port's waters, the municipal work safety administration said. Local residents reported a pungent odor near the port around 6:30 p.m., leading authorities to discover the leak. Police have taken four people into custody for their alleged involvement in the incident. Three companies involved in the spill were found to have broken regulations pertaining to the sale, transport and loading of the chemical. Local authorities have sent 20 vessels to clean up the leaked chemicals. Two local drinking water processing plants have stopped siphoning water from the contaminated area. A further investigation and environmental evaluation are both under way. ^ top ^

Govt cars cited 193 times in 3 months (Global Times)
2013-01-14
The municipal government reported Monday that government vehicles in the city have been cited for traffic violations 193 times from July to October 2012. The General Office of the Shanghai Municipal Government urged city officials in its report to consider the violations as a warning. The report is part of a broader effort to improve how city departments manage their employee vehicles. The municipal government has been implementing reforms since 2009 that it hopes will help reduce administrative costs by preventing personal use of government vehicles and cutting vehicle budgets for departments across the city. On nationwide basis, each government vehicle costs an estimated 60,000 yuan ($9,102) annually, including expenses for fuel, maintenance and drivers' salaries, according to a past report in the Economic Information Daily. In its report on government vehicle traffic violations, the General Office asked leaders at different levels of government to serve as an example for their underlings by encouraging their drivers to abide by the rules of the road. It also ordered the cited individuals to accept the violations and pay the fines without delay. The total number of violations remains far too high, said Sun Honglin, a delegate of the Shanghai People's Congress. "That figure means that a government vehicle gets cited for a traffic violation at least twice a day in the city," Sun told the Global Times. In many cases, government officials still consider themselves superior to others and can easily make a traffic ticket disappear with a phone call to the local traffic police, Sun said. [...]. ^ top ^

Industry ordered to curb emissions (Global Times)
2013-01-16
The Shanghai Environmental Protection Bureau has ordered large industrial enterprises to reduce emissions due to the air pollution that has clung to the city over the last 10 days, local media reported Wednesday. Shanghai's Air Quality Index (AQI) rose as high as 254 on Wednesday, surpassing the 200 mark that indicates heavy pollution, according to the Shanghai Environmental Monitoring Center. Pollution levels began to rise Tuesday night when a weak cold front brought in pollutants from northern China, said Zhao Qianbiao, a monitor with the Shanghai Environmental Monitoring Center. "The pollution has persisted because the stable atmosphere has allowed pollutants in the city to accumulate," Zhao told the Global Times. The environmental bureau has asked major industrial enterprises, such as large power and steel plants to do their part to improve the city's air. For example, it ordered power plants to begin using low-sulfur coal to cut down on the pollution entering the atmosphere. That measure should help reduce levels of PM 2.5, the pollutant most responsible for the rise in the AQI over the last 10 days, said Qian Hua, vice director of the Atmospheric Environment Institute at the Shanghai Academy of Environmental Sciences. [...] The bureau also ordered industrial dust to be better controlled by spraying it with water. This measure will help reduce levels of PM 10, another key pollutant sullying the city's air, Qian said. [...] However, the city should do more to reduce air pollution over the long-term, Qian told the Global times. Because automobile exhaust is one of the primary sources of PM 2.5, Qian suggested that the city try to get more heavily polluting vehicles off the road. He also advised residents to leave their cars at home more often and use public transportation. [...]. ^ top ^

Crude oil leak contained in Guangdong (China Daily)
2013-01-15
A crude oil leak in Guangdong province has been contained and clean-up operations will be completed on Tuesday morning, local authorities said. The leak occurred at 3:40 pm on Sunday in an oil pipe in Zhanjiang's Mazhang district, the local government said. The burst pipe is part of the Zhanjiang-Maoming oil pipeline owned by Maoming Petrochemical, a subsidiary of Sinopec. More than 15 tons of crude oil leaked into the Nanxi River, and the source of the leak was about 350 meters from the Chikan Reservoir, an alternate source for drinking water in Zhanjiang. The Zhanjiang government said on Monday the leak has been contained and drinking water in the city is not contaminated. More than 300 police officers and 18 firefighting vehicles were sent to control the leak, Zhanjiang Public Security Bureau said on its micro blog on Monday. A rescue team, including five firefighting vehicles from Maoming Petrochemical, also went to the scene. Transport authorities blocked roads to ensure safety, but traffic was back to normal by 1 pm on Monday, according to a statement by the Zhanjiang government. Five monitoring spots were set up by the Zhanjiang Environmental Monitoring Station to collect water from the Chikan Reservoir every two hours. Data from the station shows the reservoir's water quality is safe. More than 11,000 people from nine villages in Mazhang and Chikan districts were affected by the leak, and a special work team was set up to help them, authorities said. Investigation showed the leak was caused by a burst section of pipe, which had corroded after being underground for more than 10 years, Guangzhou Daily reported. "We check the pipeline every year, but because it is about 100 km long it is difficult to find problems with pipes in some areas," said Dong Zhangyu, publicity chief for Maoming Petrochemical. But Dong said that following the leak the company will check all of the pipeline and improve repair work. [...]. ^ top ^

Guangdong orphanage's misuse covered up with children from temple (SCMP)
2013-01-15
A 17-year-old government-funded orphanage in eastern Guangdong never took in any orphans and was instead used as a local government office and dormitory for officials. The scandal was exposed after a public outcry triggered by an earlier report saying that local officials had "borrowed" orphans from a temple in an attempt to fool senior officials who arrived to inspect government-run orphanages in the area. Xinhua said the Rongcheng district government in Jieyang built the five-storey orphanage 17 years ago, but used the building as a civil affairs office handling funerals, marriage registrations and disability issues, and as a staff dormitory. More than 115 local orphans were left without proper care as a result and had to live at a Buddhist temple or with local families. Most still lacked proper household registration documents, or hukou. The authorities have launched a campaign to inspect public and private orphanages following a fire at an illegal, private orphanage in Lankao, Henan province, in which seven children died. When told that inspectors would be arriving, Huang Jianwei, a representative of Rongcheng's civil affairs bureau, was sent to the local Zifeng temple to borrow orphans in an attempt to cover up the misuse of the building and the government's negligence, according to footage posted online. Huang is seen in the video asking the temple's 66-year-old Buddhist master Shi Yaogai for orphans to show that the district had a functioning orphanage. "So our bureau director sent me over to borrow a dozen orphans to present to our superiors [during inspection]," Huang said. In response to the allegations, Huang Chenghui, the office manager of Rongcheng's civil affairs bureau, told Xinhua that Huang Jianwei was a temporary staff member. He said the office could not be held responsible for the words of a temporary staff member as "it was not true to say we do not have an orphanage". "It's just that we have not begun a thorough investigation of the local orphan situation," Huang Chenghui told Xinhua, adding that they went to the temple to ask Shi to hand the orphans over to the government for permanent care. However, a witness named Xia Chuhui told Xinhua that he saw the two officials asking to "borrow orphans", only to be turned down by Shi. Late yesterday the city government suspended Huang Chenghui from duty and removed his director, state media reported. It also said it would allot three million yuan (HK$3.74 million) to restore orphanage care. [...]. ^ top ^

Guangdong party chief Hu Chunhua vows to stick with existing policies (SCMP)
2012-01-18
Guangdong party secretary Hu Chunhua pledged continuity and consistency while touching on his policy vision for the province for the first time since assuming the position last month. Speaking yesterday at the second plenary session of the 11th Guangdong Provincial Party Committee in Guangzhou, Hu, formerly the party secretary of Inner Mongolia, vowed to continue existing policies still in the works or pending for Guangdong. "Do not think that a new party secretary will necessarily yield new vision. The planned work laid out and promoted by the provincial party committee must be continued," he said, adding that no existing policies would be overturned. He also emphasised the need to continue "emptying the cage and letting the right birds in" - referring to an initiative launched by his predecessor, Wang Yang, to transfer low-tech, labour-intensive and highly polluting industries out of the Pearl River Delta region. Hu said the undertaking must be continued and properly carried out, so industries that remain in the delta may enjoy the fruits of their efforts. Hu also said Guangdong must form "a consensus of urgency to speed up development" because of mounting economic challenges and competition. He warned that, if implementation efforts were not stepped up, grand or ambitious plans would be at risk of staying on paper or in people's heads rather than being carried out. [...] Dr Peng Peng, a senior researcher at the Guangzhou Academy of Social Sciences, did not believe that Hu had completely unveiled his full policy vision yet. "I think he will deliver a more complete view - of how Guangdong should be run - by this weekend," Peng said. "Hu [probably] intends to reposition Guangzhou's scope of development to be on par with Beijing and Shanghai, instead of comparing it with competitors such as Tianjin or Shenzhen," Peng said. He also said Hu was likely to want Guangzhou to take a leading role, as the provincial capital, to push for economic development across Guangdong. ^ top ^

Tibetan man burns to death in Gansu, first self-immolation in China this year (SCMP)
2013-01-13
A Tibetan man has died after setting himself on fire in protest at China's rule of the Himalayan region, a rights group and overseas media said, relaying the first self-immolation of this year. The man burned himself to death at about 1pm (0500 GMT) on Saturday, London-based pressure group Free Tibet and US-based Radio Free Asia (RFA) said, in what is thought to be the first self-immolation since December. The incident happened in Xiahe, a county in western China's Gansu province known as Sangchu in Tibetan. The body of the man, who was identified with the single name Tsebe, or Tseba, was carried back to his home village about four kilometres away following a protest, Free Tibet said. The rights group said he was in his early 20s, while RFA cited its sources as saying he was 19. The man called out for the Dalai Lama to be allowed to return to Tibet, RFA said. RFA says 96 ethnic Tibetans, many of them monks and nuns, have set themselves on fire in China since February 2009 to protest against Beijing's rule in Tibet. [...] Before Saturday's immolation, the most recent protest was on December 9 when a 16-year-old girl died after setting herself alight in China's northwestern province of Qinghai, state media said. Free Tibet director Stephanie Brigden said the latest immolation demonstrates “Tibetan rejection of the Chinese occupation is as strong as ever”. “The new Chinese leadership and the international community cannot allow demands for freedom to continue to go unheeded. This year must be the year where positive change comes to Tibet,” she added. Many Tibetans in China accuse the government of enacting religious repression and eroding their culture, as the country's majority Han ethnic group increasingly moves into historically Tibetan areas. China rejects this, saying Tibetans enjoy religious freedom. Beijing points to huge ongoing investment it says has brought modernisation and a better standard of living to Tibet. [...]. ^ top ^

Christians in prayer rally to fight gay law proposal (SCMP)
2013-01-14
Thousands of Christians staged a rally outside government headquarters yesterday to show their opposition to proposed legislation that would outlaw discrimination against sexual minorities. The Evangelical Free Church of China Yan Fook Church, which organised the event, estimated that up to 50,000 people joined the "Inclusive Love Praying Concert" at Tamar Park, Admiralty, to voice their disapproval through singing and praying. They said such a law would restrict their freedom of speech on gay rights. Police put the turnout at 5,000. "If this becomes the law, those who oppose homosexuality will have their freedom of speech restricted," said the Reverend Jayson Tam, convenor of the "praying concert". In a separate public event, Secretary for Constitutional and Mainland Affairs Raymond Tam Chi-yuen said Chief Executive Leung Chun-ying would disclose shortly whether a public consultation would be launched. "In this regard, our colleagues have already made preparations. We are ready [for a public consultation] once the chief executive finds it is the appropriate time … Once there are further communications and public discussions [in the community], I believe there will be an opportunity to conduct a public consultation, details of which will be addressed in the policy address," Tam said. The chief executive delivers his maiden policy address on Wednesday. The Reverend Tam said there were examples in Western countries of similar legislation leading to "reverse" discrimination. He added they did not oppose the government launching a consultation on the law, but they would voice their opposing views. [...]. ^ top ^

Beijing concerned about national identity in Hong Kong youth (SCMP)
2013-01-15
Beijing is said to be "gravely concerned" that Hong Kong youth lack a sense of national identity. A Hong Kong deputy to the National People's Congress, Michael Tien Puk-sun, said yesterday that the issue was raised at a meeting of local deputies in Shenzhen. The Standing Committee's deputy secretary-general, Qiao Xiaoyang, read out a letter by vice-chairman Li Jianguo expressing Beijing's concern. "He said the central government was gravely concerned," Tien said, citing the letter. "The reason why they see a problem is that polls have found that more people identified themselves as Hongkongers instead of Chinese. Some have even waved the old Hong Kong flag, and there was strong opposition to the introduction of national education." Tien said that after the handover Beijing had hoped the mainland and Hong Kong would grow closer. It feared that if Hong Kong youth resisted the motherland, the two sides would grow apart. The Shenzhen gathering was the first working meeting since the 36 deputies were elected last month. Qiao cited the letter as noting Chief Executive Leung Chun-ying's recent difficulties and expressing hope that Leung and his election rival Henry Tang Ying-yen could set aside their differences, Tien said. "Qiao cited Li as saying that when we give advice or criticise the policies of the government or the chief executive, it should be based on facts and be reasonable," he added. Tien said the official's remarks could imply that Beijing found the pro-establishment camp was not united enough. In April, President Hu Jintao and Wang Guangya, director of the Hong Kong and Macau Affairs Office under the State Council, also called for unity in the city. [...] Fanny Law Fan Chiu-fun, a deputy who was not at yesterday's meeting, said she did not think most people in Hong Kong wanted independence. "Only a tiny minority holds such radical views," Law said. Commenting on the concern about youth disaffection, she added: "I think there is no need to exaggerate the matter, although I agree there is a need to step up dialogue with young people and give them a whole picture of the nation's development." [...]. ^ top ^

Chief executive declares his priorities for helping an overcrowded city (SCMP)
2013-01-17
Embattled Chief Executive Leung Chun-ying yesterday laid out ambitious plans in his maiden policy address to boost land supply and address the city's acute housing problems. A blueprint that will set policy direction in the next five years, Leung's plan contains few surprises but sticks to a pragmatic approach, with plenty of measures to tackle economic, environmental and social issues. He also declared that it was the government's main concern to ensure an adequate and steady supply of land and homes. "The top priority of the current [...] government is to tackle the housing problem," the 58-year-old chief executive told the Legislative Council, acknowledging the sharp rise in property prices and an outcry over the cramped living conditions of tens of thousands of people. "We recognise that problems stemming from property prices and rental, cage homes, cubicle apartments and subdivided units cannot be solved overnight. But we must acknowledge these problems, understand the gravity of the situation, and take the first step forward to resolve them," Leung said. He highlighted the need to improve Hongkongers' living space, citing his personal encounters with people living in subdivided flats. He appealed to the young generation to consider the "overall interests of the community" when deciding whether to oppose new town developments. Among controversial plans to build up a land reserve are proposals to reclaim large tracts of land amounting to 3,000 hectares, including building artificial islands east of Lantau. Other measures include lifting 40-year-old development restrictions in Mid-Levels and Pok Fu Lam, asking private developers to provide public housing in former quarry sites and building a new town for 260,000 people in the Northern New Territories. [...] On the economic front, Leung said the government must be "appropriately proactive" to safeguard Hongkongers' interests, a point underpinned by earlier policies. These include restrictions on non-permanent residents buying property, such as the 15 per cent buyer's stamp duty, and banning mainland women from giving birth in Hong Kong. This "zero delivery quota" policy, for mainlanders whose husbands are not Hong Kong residents, would be maintained. Leung did not go into detail about relief measures for the poor. A government source said Financial Secretary John Tsang Chun-wah would announce more relief measures in his budget speech on February 27. To clean up the environment, the government will phase out old diesel commercial vehicles and give owners HK$10 billion in subsidies to replace 80,000 heavily polluting ones. Leung said little about universal suffrage and did not give a timetable for the consultation on the chief executive election in 2017 and the Legislative Council election in 2016, saying only that these would be conducted at an "appropriate juncture". [...]. ^ top ^

Macau sees only 0.3pc rise in visitors but record gaming revenue (SCMP)
2013-01-16
Visitor numbers in Macau last year did not increase significantly despite casinos raking in a record high in revenue. Based on preliminary figures, the city saw 28 million visitors in 2012 - only a 0.3 per cent increase from the previous year - said Macau Government Tourist Office director Maria Helena de Senna Fernandes yesterday. The annual visitor growth was 12.2 per cent in 2011 and 14.8 per cent in 2010. Of the 28 million visitors to Macau, 25 million were from the Greater China region, which includes mainland China, Hong Kong and Taiwan, while the remaining three million were international visitors from countries such as Korea and Japan. The number of visitors from Greater China rose by 0.4 per cent while that of international visitors fell by 0.5 per cent last year. People from mainland China alone accounted for 17 million visits - a 4.6 per cent increase from that in 2011 - but the number of Hong Kong and Taiwan visitors dropped by 6.6 per cent and 12 per cent, respectively. [...] Meanwhile, Macau's casino industry reported a record gross gaming revenue of 304 billion patacas, up a 13.5 per cent from the previous year's 270 billion. Professor Davis Fong Ka-chio, a gaming management associate professor from the University of Macau, attributed the record gaming revenue to the casinos' move of raising the minimum gambling amounts on the mass gaming floor. "In early 2012, the minimum bets for the mass gaming floor of many casinos were increased from 300 to 500 patacas, to 500 to 1,000 patacas," he said. "As a result, the gambling amount of the whole 2012 is increased." Some casinos like Galaxy, the Venetian and City of Dreams have also attracted more mainland clients with customised services such as personal towels and cups for premium gamblers on the mass gambling floor, Fong said. He said he expected casino revenue to grow by 10 per cent to about 330 billion patacas this year as visitors stayed longer. ^ top ^

Taiwan considers shipping water from mainland as ties improve (SCMP)
2013-01-13
Officials on a Taiwan-controlled island group said on Sunday they are considering importing water from the mainland in yet another sign of warming relations. The move would mark another significant step forward in the improvement of ties, since the fortified Kinmen island group was a flashpoint during the cold war and was shelled from the mainland at one point. Officials from Kinmen have discussed a proposal to use ships to transport water from Xiamen, a coastal city in southeastern Fujian province just kilometres away. Water supplies, mostly from desalination, underground supplies and a tiny dam, are sufficient at the moment to meet the needs of some 100,000 civilians and of troops stationed there. “But water supplies may fall short in the near future if more tourists, many of them from the mainland, visit Kinmen,” Chen Chaur-jiung of the Kinmen county government said. Mainland tourists make hundreds of thousands of visits to Kinmen each year. From a long-term point of view, the Kinmen government hopes to instal pipes linking Xiamen and Kinmen, Chen said. “The idea of buying water from the mainland was hard to imagine a few years ago,” he said. [...] Tensions across the Taiwan Strait have eased since Beijing-friendly President Ma Ying-jeou came to power in 2008, pledging to boost trade links and allow in more mainland tourists. He was re-elected in January last year for a second and last four-year term. ^ top ^

Taiwan gears up for military drills to counter any mainland threat (SCMP)
2013-01-16
Taiwan would stage 62 military drills and mobilisation exercises this year to strengthen its defensive capabilities in the face of a growing military threat from the mainland, the island's defence ministry said yesterday. The exercises, including war games, troop and civilian mobilisations and electronic simulations, will start next month. Officials said the island had no intention of engaging in an arms race with the mainland but said the military needed to stage exercises to ensure it was prepared for any potential attacks from the mainland. "In the face of an ever increasing military threat from the Chinese communists, the military is making detailed plans and fully preparing to consolidate various types of combat readiness and training within the armed forces," defence ministry spokesman Luo Shou-he said. Although cross-strait relations have improved steadily since Ma Ying-jeou of the mainland-friendly Kuomintang became president in 2008, Beijing still has more than 1,000 missiles targeting the island to deter any move towards declaring independence. [...] Major General Lee Chao-ming, director of Taiwan's military training division, said the most important drill would be the annual Han Kuang exercises, to be held in two stages, with live military drills scheduled for April and computer-aided war games set for July. Lee did not say how many servicemen would be involved in those drills but last year more than 200,000 took part in five days of exercises to practice hi-tech military tactics based on conflict between asymmetrical forces. He also said the army would stage three artillery exercises this year, while each of the three forces would hold live-fire missile drills. There would also be joint combat drills on outlying islands including Quemoy, Matsu, Penghu, Tungying and Wuchiu - known as the front-line islets because of to their proximity to the mainland. [...] Meanwhile, in a meeting with members of a visiting US Senate delegation, Ma stressed Taiwan's claim to sovereignty over the Diaoyus, saying the disputed island group was traditionally a territory of Taiwan. But he called for dialogue among the claimants and peaceful development of the island group, believed to be surrounded by rich oil and fish resources. Ma also called on the US to sell advanced F-16 C/D fighter jets to Taiwan. ^ top ^

Taiwan sees record number of births in 2012 (Xinhua)
2013-01-16
Nearly 235,000 babies were born in Taiwan last year, marking a record-high for the past ten years, the island's civil affairs authority said Tuesday. The number of babies born last year topped 234,599, and the total fertility rate in 2012 reached 1.265, up from 0.895 in 2010, said the authority, adding that the record came amid the island's policies to encourage childbirth and the people's enthusiasm for giving birth in the year of the dragon. Long challenged by an aging population and a low birth rate, Taiwan introduced a series of policies last year to encourage its citizens to have more children, including hosting matchmaking activities and offering allowances to couples with children under 2 years old. Taiwanese authorities estimate that over 200,000 babies will be born this year, and the fertility rate will stand at 1.2. ^ top ^

Rising veg prices push up inflation (Global Times)
2013-01-13
China's inflation accelerated to a seven-month high in December, mainly pushed up by rising vegetable prices due to the cold weather, the National Bureau of Statistics (NBS) said Friday. The consumer price index (CPI), a main gauge of inflation, rose 2.5 percent year-on-year in December, its fastest pace since June 2012, the NBS said in a statement. The annual inflation rate was 2.6 percent in 2012, far below the central government's target of keeping inflation under 4 percent last year. "The jump in December's CPI was largely due to a surge in vegetable prices," Yu Qiumei, a senior statistician with the NBS, said in the statement. Vegetable prices jumped 14.8 percent year-on-year in December, because snow in northern China and rainy weather in southern China disrupted vegetable production and transportation, Yu said. Consumers have already felt the pinch. "I found prices of green leafy vegetables rose fast in recent months, and some are even more expensive than meat prices," Cao Ruzhen, a 42-year-old resident in North China's Tianjin, told the Global Times Friday. "If vegetable prices continue to rise, my family will eat more meat instead," she said. "To ensure stable vegetable supplies, local governments should allocate more land near cities for agricultural use, which could help reduce dependence on long-distance transportation of vegetables," Lian Ping, chief economist with the Bank of Communications, told the Global Times Friday. Analysts expect China will face increasing inflationary pressure in 2013 compared to 2012. Food prices are likely to rise further due to growing consumption during the Spring Festival holidays (which fall in February this year), Yu said. "Pork prices, a staple food in the country, will head into a new upward cycle this year, pushing up inflation," Lian said. He expected the annual CPI growth for 2013 to stay between 3 and 3.5 percent. [...]. ^ top ^

China steps up opening of markets with tenfold boost to foreign investors (SCMP)
2013-01-14
Hong Kong and mainland stocks jumped yesterday as the nation's securities regulator said the quota for foreign investments in the mainland's financial markets could rise by up to 10 times. The announcement by China Securities Regulatory Commission chairman Guo Shuqing, coming on the heels of the central bank's statement that work was on to encourage outbound investment, was seen as further proof that Beijing was intensifying efforts to open up the capital markets. The Shanghai stock index rose more than 3 per cent, the biggest one-day gain in nearly a month, while the Hang Seng Index gained 0.64 per cent on the news. The Hang Seng China Enterprises Index, which tracks stocks of companies incorporated on the mainland but listed in Hong Kong, rose 1.36 per cent. Speaking at the Asia Financial Forum in Hong Kong yesterday, Guo said the quota for the original dollar-denominated Qualified Foreign Institutional Investment (QFII) scheme and the renminbi-denominated QFII, or RQFII - the two schemes that allow overseas institutional investors to buy stocks and bonds on the mainland - could go up by nine to 10 times. The two schemes account for up to 1.6 per cent of the funds invested in the mainland's yuandenominated A shares. Guo's statement followed the People's Bank of China's announcement on Friday that preparations were under way for trials of the qualified domestic individual investor, or QDII2, scheme. That scheme is part of a major initiative this year to increase outbound investment by the private sector. Beijing may also allow individual and non-Chinese institutional investors to join the RQFII - which channels offshore renminbi deposits back into the mainland - in the next phase of expansion, Guo said. The programme is currently open only to Hong Kong units of mainland financial institutions. [...]. ^ top ^

FDI growth drops for first time in 3 years (Global Times)
2013-01-17
Foreign direct investment (FDI) inflows into China dropped for the first time in three years in 2012 amid the slow recovery of the world economy, but there is no sign of a large-scale exit of foreign capital from the country, the Ministry of Commerce said Wednesday. The country's foreign trade growth, which fell short of the 10 percent target by nearly four percentage points in 2012, is expected to keep pace with the economy in 2013, suggesting a slight pickup from the previous year, the ministry also said. Total FDI into the country fell 3.7 percent in 2012 from a year earlier to $111.72 billion, data from the ministry showed Wednesday. It dropped slightly from a record high of $116 billion in 2011 and was the first decline since 2009. "There is a slight decline in foreign capital inflow into the country with foreign investment in manufacturing industries showing a larger fall," ministry spokesman Shen Danyang said at a press conference Wednesday. The migration of manufacturing from the country involved foreign-funded companies and domestic companies investing abroad. There is no large-scale pulling-out of foreign investment from China, Shen said, calling it quite normal. [...] One cause behind the FDI decline is that global corporations' profits were eroded in 2011 and 2012, so their leadership is more cautious about investment and preserving their cash, Andre Loesekrug-Pietri, managing partner of A CAPITAL, the leading China-Europe Private Equity Fund, told the Global Times. "These data are not surprising as they reflect the current economic deceleration in developed economies. But we should keep in mind that these numbers are still very high and close to the record high FDI of 116 billion in 2011. China is still one of the largest recipients of FDI in the world," Loesekrug-Pietri said. [...] Commerce Minister Chen Deming said Monday that FDI into China in 2013 is to stay at the same level with 2012. Meanwhile, responding to a question whether China's trade growth target for 2013 will be set at 8 percent, Shen said the trade situation in 2013 is still severe and the country's trade target in 2013 is "to try to keep foreign trade to grow at roughly the same level as GDP growth." [...]. ^ top ^

Pyongyang told Beijing about third nuclear test, report says (SCMP)
2013-01-13
North Korean official has reportedly told Chinese authorities that the communist state plans to conduct a third nuclear test this week, though analysts have greeted the news with scepticism. "We've heard a North Korean official in Beijing told the Chinese side that the North planned to carry out a nuclear test between January 13 and 20," the Joongang daily quoted an unidentified Seoul official as saying. South Korean officials have a policy of not commenting on intelligence matters. "We're now stepping up surveillance over the Punggye-ri nuclear test site," the official said, referring to the North's only nuclear test site, where tests were carried out in 2006 and 2009. With the UN Security Council still debating possible sanctions after the North launched a long-range rocket last month, there has been widespread speculation that Pyongyang may carry out a third nuclear test. But Professor Yang Moo-jin, of the University of North Korean Studies in Seoul, said there were "no signs of a nuclear test being imminent". "Chances are slim that the North might push ahead with a nuclear test in this winter season, especially when China is insisting on a moderated response to the rocket launch to prevent a third nuclear test taking place," Yang said. Last month, an American think tank said that based on satellite photos the North had repaired extensive rain damage at the nuclear test site in the northeast of the country and could conduct a detonation on two weeks' notice. The US-Korea Institute at Johns Hopkins University said satellite images as recent as December 13 showed Pyongyang was determined to maintain a state of readiness at the Punggye-ri site. Last month, South Korea's Unification Minister, Yu Woo-ik, told a parliamentary committee that it was "highly probable" the North would follow up its successful rocket launch with another nuclear test. "Judging from analysis of intelligence, significant preparations have been made," the minister said. [...]. ^ top ^

DPRK calls for UN Command dissolution, peace treaty (Xinhua)
2013-01-15
The Democratic People's Republic of Korea (DPRK) on Monday called for the dissolution of the UN Command (UNC) and a peace treaty to replace the Armistice Agreement (AA), the official news agency KCNA reported. A DPRK foreign ministry memorandum said whether the United States dismantles the UNC or not could be seen as a measurement of Washington's willingness to maintain its "anti-DPRK policy." The document argued that the United States is against replacing the AA with a permanent peace treaty because it wants to hold onto the armistice regime and the UNC. The DPRK will maintain and strengthen its war deterrent capabilities until the United States decides to make the right choice, said the ministry. The ministry added that political talks at a level higher than military commanders are the only way to ensure a lasting peace. The Korean War came to a ceasefire on July 27, 1953, when the AA was signed in Panmunjom on the border of the DPRK and South Korea. But the war is not officially over because no peace treaty has ever been signed. ^ top ^

Mongolia to build first oil refinery by 2015 (Xinhua)
2013-01-13
The Mongolian government has decided to finish construction of the country's first oil refinery in the central Darkhan province by the end of 2015. Mongolia will construct the state-owned refinery with the capacity of processing 2 million tons of crude oil per year in Darkhan by 2015, and start negotiations with Japanese banks to obtain loans for the refinery, the government said in a statement Saturday. The refinery will be built by Japan's Toyo Engineering Corporation with the Mongolian companies as subcontractors. Mongolia has no oil refining industry. Some 90 percent of its consumed petroleum products are imported from Russia. ^ top ^

China, Mongolia to deepen cooperation in mining, energy sectors (Xinhua)
2013-01-15
China and Mongolia have broad prospects to deepen cooperation in mineral resources and energy, a senior Chinese official said Tuesday. Zhang Xiaoqiang, deputy director of China's National Development and Reform Commission, said the two countries should enhance cooperation in mining and energy areas through joint development of big mining projects and construction of transportation infrastructure. Zhang made the remarks at the third meeting of the China-Mongolia cooperation commission on mineral resources and energy in Ulan Bator. [...] Mongolian Mining Minister D. Gankhuyag highlighted the rapid development of Mongolia-China economic and trade cooperation, saying that Mongolia has seen Chinese investment rapidly increasing in the country in the last few years. The minister also suggested the two sides strengthen cooperation in deep processing of resource products and adopt measures to solve difficulties in coal transportation. ^ top ^

Mongolia's economy grew 12.3% in 2012 (Xinhua)
2013-01-16
Mongolia's gross domestic product (GDP) grew 12.3 percent in 2012, down from 17.3 percent in 2011, said the Mongolian Statistical Committee. According to latest statistics, Mongolia has seen growth in grain output in the last five years in a row and its wheat production of 480,000 tons in 2012 could fully meet the country's domestic demand. The country's animal husbandry sector also saw great achievements in 2012, with a record high of 15 million farm animals reproduced in the 12-month period. The total livestock number rose 12.6 percent from that of 2011. For other economic sectors, the mining industry grew 8.9 percent in 2012, transportation up 11.4 percent but foreign trade down 2.6 percent. Agriculture and the mining industry are the two pillars of the Mongolian economy. The landlocked country has registered robust economic growth in recent years thanks to the rapid development of its mining industry. ^ top ^

Price of basic food commodities in Ulaanbaatar has been increased by 5.3%, compared to last month (Infomongolia.mn)
2013-01-17
According to National Statistical Office of Mongolia, as of January 16, 2013, the average price of basic food commodities at major food markets and groceries stores in Ulaanbaatar has been increased by 5.3% compared to same period of last month and 0.7% compare to last week's averages. An average price for meat: As of January 16, 2013, compared to the price average of previous month, the price per kg of beef has been increased by 4.9-6.7%, mutton by 10.7%, horse meat by 4.1% and goat meat by 12.6% each. Compared to the previous week the price for beef per kg has been increased by 1.4-1.6%, mutton per kg by 1.0%, goat meat by 6.4% and horse meat by 2.4% each, besides 1 kg of mutton (with bones) is at an average of 6,914 MNT, mutton (without bones) - 7,080 MNT, beef (with bones) - 7,650 MNT, beef (without bones) - 8,643 MNT, goat meat - 5,300 MNT, and horse meat - 5,750 MNT. An average price for flour: As of January 16, 2013, compared to the price average of previous month, price of “Altan Taria” unpacked 1st grade flour has been increased by 2.6%, where 1 kg packed high grade flour by 0.9% and comparing to the last week the prices for flour are unchanged. ^ top ^

Mongolia Draft Mining Law Threatens Investment Climate (News.mn)
2013-01-17
Proposed changes to Mongolia"s mining law threaten to undermine the economic viability of its fledgling mining sector, with negative consequences for the entire economy and future investment in the country, business leaders and investors warned. The legislation, which includes a requirement for existing miners to relinquish stakes in projects to indigenous groups, marks a departure from the free-market principles that have benefited the country since the 1990s, The Business Council of Mongolia, the country"s largest business group, said in a four-page open letter to Mongolia"s president last week. [...] The legislation, if approved in its current form, will "halt current minerals exploration and development in Mongolia and greatly discourage any future investment," The Business Council of Mongolia, which has more than 250 members, said in its open letter. It also threatens the development of the nation"s largest coal reserves, Tavan Tolgoi, the council said. [...] The draft law, which would replace the one signed in 2006, proposes several measures that would give the Mongolian government a firmer grip over its mineral resources while raising concerns about ownership rights and possibly lead to higher taxation. The legislation would require that mining companies hand over a stake of at least 34% in their existing projects to indigenous groups. It would also require companies to mine lower ore grades even if they"re not profitable, said Luke Lesley, head of mining at London-listed Origo Partners PLC (OPP.LN), a private equity group that owns stakes in various Mongolian mining companies. The draft law also raises concerns about security of license tenure and fails to identify a dispute resolution process or body given overlapping powers between different ministries and local government, Mr. Lesley said. The Council also said was unclear whether the government may be able to apply the draft law retroactively to existing projects. […] "Both domestic and foreign investors have unanimously and unambiguously responded negatively to these amendments," the U.S. embassy in Mongolia said in a report about investment climate published Tuesday. "They argue that the amendments grant the government broad and vague discretionary authority to revoke exploration and mining rights without meaningful checks on these powers; and impose taxes and fees, development obligations, and production, management, and employment practices that may render commercial mining impossible in Mongolia," it noted. "It makes it very hard to raise money for any of these projects with all of this lack of clarity," Mr. Lesley said. [...] Businessmen and investors are also concerned that the draft law may fall foul of political posturing ahead of the presidential elections in May. The draft legislation is "almost certainly politically motivated," said Mr. Lesley. "Both of the main parties are looking at popular measures that could be put to the electorate." [...] "Passage of the Draft Law in its current form is likely to damage Mongolia"s brand as an investment destination," the Business Council said, noting that it would lead investors in all sectors of Mongolia"s economy to re-evaluate the country"s sovereign risk profile. The end result could repel rather than attract foreign direct investment, the Council said. ^ top ^

Fabian Eng
Embassy of Switzerland