Bilateral Issues

• Chinese vice premier meets foreign leaders attending eco forum (Xinhua)

Foreign Policy

• Myanmar president meets Chinese senior military official (Xinhua)
• US diplomat says China ties a priority (China Daily)
• Causing trouble in the S. China Sea will hurt Manila (People's Daily Online)
• Coastguard vessels make first foray to Diaoyus (SCMP)
• Vice-President's North Korea trip shows Pyongyang still key partner (SCMP)
• China, Australia vow to speed up FTA talks (Xinhua)
• Chinese FM meets Armenian counterpart (Xinhua)
• Vietnam president: We oppose China's nine-dash line claim (SCMP)

Domestic Policy

• 6.6-magnitude quake hits NW China (Xinhua)
• 89 dead after earthquake strikes Gansu counties (SCMP)
• Hot topics loom at Beidaihe summer summit as Chinese leaders meet to discuss reform (SCMP)
• Aid needed in quake-hit regions (China Daily)
• Xi names low-key outsider as personal secretary (SCMP)
• Li points way for railways reform (China Daily)
• Disgraced Bo Xilai formally charged over corruption (SCMP)
• Activists 'detained while celebrating Hu Jia's birthday' (SCMP)

Beijing

• Beijing airport bomber's 'mistreatment' case reopened (SCMP)
• Beijing airport bomber detained in unknown location (SCMP)

Tibet

• Tibetan monk sets himself on fire, report says (SCMP)

Xinjiang

• Long-time Xinjiang official promoted to central committee (SCMP)

Taiwan

• Xi congratulates Ma's re-election as KMT leader (Xinhua)

Economy

• China manufacturing slips to 11-month low, signalling slowdown (SCMP)
• China to suspend VAT for small businesses (Xinhua)

DPRK and South Korea

• ROK-DPRK industrial park talks end without agreement (China Daily)
• DPRK halt on rocket facility confirmed (China Daily)
• Top DPRK leader meets Chinese vice-president on relations (Xinhua)
• Vice president's Pyongyang trip aims to unfray Sino-N.Korean ties (Global Times)

Mongolia

• 17th International Marathon 2013 Mongolia (news.mn)
• State Bank takes over insolvent Khadgalamj Bank (UB Post)
• Mongolia's debt to Chalco will be paid off within this year, said Deputy Minister of Mining O.Erdenebulgan (Info Mongolia)

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Chinese vice premier meets foreign leaders attending eco forum (Xinhua)
2013-07-19
Vice Premier Zhang Gaoli on Friday met with four foreign leaders who will attend the opening ceremony of the Eco-Forum Global in Guiyang, capital city of southwest China's Guizhou Province. During the meeting with Swiss President Ueli Maurer, Dominican Prime Minister Roosevelt Skerrit, Tongan Prime Minister Siale'ataonga Tu'ivakano and Thai Deputy Prime Minister Nivatthamrong Boonsongpaisal, Zhang said the Chinese government attaches great importance to the construction of ecological civilization. China incorporates ecological civilization into economic, political, cultural and social development, said the vice premier. He added that China hopes to use the forum to popularize the idea of ecological civilization, promote international cooperation, jointly cope with climate change and push forward global sustainable development. When meeting with Maurer, Zhang suggested that China and Switzerland further enhance cooperation in environmental protection, land and urban construction. He said China should combine its broad market with the advanced ideas and technology of Switzerland, so as to make contributions to sustainable development of the world. [...] The Eco-Forum Global, held from Friday to Sunday, is an independent international organization committed to improving the world by engaging business, political, academic and other leaders to shape global, regional and industry agendas. ^ top ^

Myanmar president meets Chinese senior military official (Xinhua)
2013-07-23
Myanmar President U Thein Sein met Vice Chairman of the Central Military Commission of China, Fan Changlong, in the Myanmar capital of Nay Pyi Taw on Tuesday. U Thein Sein said Fan's choice of Myanmar as his first foreign trip after he took up the post shows the friendly ties between the two countries and the two armed forces. Noting that Myanmar-China "paukphaw" (fraternal) friendship is long-standing and deep in the hearts of the people, he said enhancement of the Myanmar-China cooperation not only conforms to the fundamental interest of the two peoples but also contributes to the development and stability in the region. He expressed Myanmar government and armed forces' thanks to the Chinese counterparts for their support and assistance in the past years, vowing that Myanmar will continue to adopt a friendly policy towards China and make tireless efforts to push the continued development of Myanmar-China comprehensive strategic cooperation partnership. Fan said that China and Myanmar are true and good friends, good neighbors and good partners, adding that such friendship deserves treasure as it was built by successive generations. For the past several years, the two countries frequently exchanged high-level visits making major achievement in politics, economy and trade and culture, he said, adding that under the guidance of the two countries' heads of state and the joint efforts of the two armed forces, ties between the two armed forces have maintained a good trend of development. He expressed China's wishes to work hand in hand with Myanmar to further push the relations between the two countries and the two armed forces. Fan also met with Speaker of Myanmar's House of Representatives U Shwe Mann and held talks with Commander-in-Chief of Myanmar Defense Services Senior-General Min Aung Hlaing, exchanging views in depth over the ties between two countries and the two armed forces. Commander of Lanzhou military region Liu Yuejun and Chinese Ambassador to Myanmar Yang Houlan were present at the meetings. Fan arrived in Yangon on Monday on a three-day official visit to Myanmar as part of his three-country tour to Kazakhstan, Myanmar and Thailand. ^ top ^

US diplomat says China ties a priority (China Daily)
2013-07-24
The new top US diplomat for East Asia reaffirmed that building a better relationship with China is one of the three pillars of his country's policy in the Asia-Pacific region. Daniel Russel, who became assistant secretary of state for East Asian and Pacific affairs a week ago, said the other two pillars are modernizing the five treaty alliances the US has in the region — with Japan, the Republic of Korea, Australia, Thailand and the Philippines — and participating in building regional institutions such as the East Asia Summit and Trans-Pacific Partnership. "The United States has placed a premium on trying to build a cooperative partnership with China through direct and high-level dialogue," Russel said on Monday during his first news briefing in the job. He said he has been involved throughout his career with improving the "hugely consequential relationship" with China, especially in the past few years, as special assistant to the president, and the National Security Council's senior director for Asian affairs. "This is an ongoing project. It continues and will continue," said the career diplomat. "We are exploring the areas in which cooperation between US and China, two major economies, can make a positive and practical impact both on the well-being and lives of the citizens of both our countries, but also in the region and in the global economy and in the global context," Russel said. He said the two countries are working hard to develop a candid dialogue. "There are areas of disagreement, and we need to make sure that we understand the motivations and objectives of the other side," he said. Russel said such a spirit was behind the Sunnylands summit between President Xi Jinping and US President Barack Obama in California in early June, as well as the fifth China-US Strategic and Economic Dialogue in Washington 10 days ago. "The US and China don't agree on everything, of course, but we talk about everything," he said. Russel accompanied US Secretary of State John Kerry to China in April. He also attended the opening session of the dialogue. Russel described the willingness of senior officials to talk directly and constructively on regional and multilateral meetings as "emblematic of the determination of both sides to ensure the lines of communication between our two nations are wide open". "It is clearly my belief and my impression that maintaining a good line of communication between Washington and Beijing is also a priority for other countries in the region," he said. He said countries throughout the region expect and want the US and China to maintain high-level dialogue and practical cooperation to help generate positive results. Bonnie Glaser, a senior adviser for Asia at the Center for Strategic and International Studies, said the US and China should continue to try to promote cooperation where their interests converge, and to manage disputes on issues where they disagree. "President Obama remains committed to developing a positive relationship with China as well as to the US rebalancing to Asia," she said. "It remains important for our leaders and senior policy officials to have frequent dialogue in person and by phone, to coordinate our respective policies," Glaser said. Russel said he came away from the recent dialogue with a sense of continued progress, when the two countries talked about hot issues such as the denuclearization of the Korean Peninsula, Syria, climate change, cyberspace, human rights, maritime security and the relationship between US and Chinese militaries. He described the dialogue as underscoring the global reach and global impact of the world's two largest economies. "We really show the breadth of our engagement, of the continued strides we are making in expanding meaningful cooperation on issues that are genuinely important to both our people, to the region and to the world as well as the progress in managing areas where we have real disagreements," he said. He said he is aware of the problems in the region, such as the nuclear program of the Democratic People's Republic of Korea, tensions over territorial disputes in the South China Sea and East China Sea, and issues related to cyberspace, climate change and energy security. Russel said there will be no "letup, no backtracking" of the US commitment to rebalance to the Asia-Pacific region, where the US claims to have enormous interests and investments. Many Chinese have remained suspicious of the US rebalancing strategy, regarding it as a scheme to contain China's rise. Some US scholars have even called for adjusting the strategy to play down the military component and enhance the economic aspect of the program. Russel, who worked many years in Japan as a diplomat, emphasized the "peaceful and responsible" management of territorial disputes between China and Japan in the East China Sea. He said the US continues to encourage the diplomatic process to manage the issue in a way that will reduce tensions, reiterating the US stance of not taking sides on sovereignty issues. However, in China, many see the US stance on the territorial disputes in both the East China Sea and South China Sea as biased in favor of allies Japan and the Philippines. ^ top ^

Causing trouble in the S. China Sea will hurt Manila (People's Daily Online)
2013-07-24
On July 15 a spokesperson from the Philippine Department of Foreign Affairs (DFA) said that China's unequivocal stance on the South China Sea dispute, requiring that recognition of China's sovereignty over the South China Sea be the premise of any negotiations, made it impossible for Manila to conduct any further negotiations with China. At the same time that the Philippines has blocked the pathway to negotiations with China, it has thrown open its doors to the U.S., a country towards which Manila is happy to extend the greatest confidence. The Philippine government pointed out on July 13 that U.S. president Obama has warned China not to resort to arms or other threats in resolving maritime disputes with neighboring countries. Although the spokesperson for the Philippine president did not specify that Obama's attitude was intended to support the position of Manila, he stressed that the Philippines shared the same stance with the U.S. There is an important factor behind the tough stance currently being promoted by Manila - internal pressure. When he assumed power Benigno Aquino III made commitments to fight against corruption and poverty, and offered guarantees of reform. But faced with the high unemployment rate, the frequent occurrence of natural disasters, and little to show by way of political progress, the Philippine people are rapidly becoming disillusioned. Manila needs to find an “enemy” to distract the people's gaze. Under the American policy of “rebalancing” in the Asia-Pacific region, former U.S. defense secretary Leon Panetta announced last year that the U.S. would deploy 60 percent of its military forces in the area. This year the current U.S. defense secretary Chuck Hagel has confirmed that 60 percent of U.S. air force and Marine Corps would be deployed in this region, and announced that distribution of advanced weapons will be made a priority. This strategic adjustment delights the Philippines, which already considers itself an ally of the U.S. and is more than happy to play the role of its pawn. The U.S. is now in discussions with the Philippines over an agreement allowing the extension of military bases and a rotating complement of forces. The agreement will also permit U.S. soldiers to stay longer in the Philippines and station themselves in Philippine military bases. The Philippines has long maintained close military ties with the U.S. The Philippines relies on U.S. military protection. Two thirds of Philippine military spending is financed from the rental revenues of its military base leased to the U.S. When the Philippines restarted its arms programs, sourcing from the US became its first choice. Many of its second-hand F-16 fighters and retired Hamilton-class cutters were imported from the U.S. It is therefore clear that the Philippines is determined to do everything it can to facilitate the U.S. “rebalancing”. However, in contrast to the perceived advantages of these maneuvers, reality is somewhat less accommodating. Manila seems to be out of step with its own people. The negotiations with the U.S. have triggered a lively discussion in the Philippines. More and more people are opposed to the agreement. Many senators are worried that opening military bases will damage their national interests. Much of the media is saying ”no” to military bases, sensitive to national sentiment and the lessons of history. Academics have pointed out the problems that the U.S. military base is likely to cause. The increasing U.S. military presence is accompanied by much that is neither positive nor beneficial: according to the former head of the Philippine Department of Foreign Affairs (DFA) rubbish is being dumped in the seas over the Philippines, coral reefs are being damaged, and there is the unexplained appearance of U.S. drones in the country's air space. The Philippines is at risk of becoming isolated in the international community. Although the Philippines makes frequent play of its “importance” as a pawn, the U.S. has made it clear that it takes no side in the South China Sea issue. This means that no matter how closely the Philippines stands by the U.S., the latter will not rashly dispatch troops over issues of sovereignty and territory. Just as its own academics have observed, Manila should not always take its stance from the U.S. The country should develop diplomatic policies that are independent and based primarily on its own long-term interests. ^ top ^

Coastguard vessels make first foray to Diaoyus (SCMP)
2013-07-25
Chinese coastguard ships were spotted yesterday for the first time near the disputed Diaoyu Islands after a reorganisation of the service to boost Beijing's ability to enforce its maritime claims. Japan's coastguard said four Chinese craft were seen early in the day just outside Japanese territorial waters around the tiny uninhabited East China Sea islands, called the Senkakus by Japan. Meanwhile, Japan scrambled fighter jets yesterday after a Chinese military aircraft flew for the first time through international airspace near its southern islands out over the Pacific. Japan's Defence Ministry said a Chinese Y-8 airborne early warning plane flew through airspace between Okinawa prefecture's main island and the smaller Miyako island in southern Japan at around noon and later took the same route back over the East China Sea. "I believe this indicates China's move toward further maritime expansion," said Japanese Defence Minister Itsunori Onodera. Beijing officials were not available for comment Mainland websites ran photos taken by the Japanese coastguard showing a ship painted in the service's new red, white and blue-striped livery. China's reorganised coastguard, formally inaugurated on Monday, merges four agencies responsible for fisheries administration, maritime surveillance, customs enforcement and border control. Officials said the move would help boost efficiency in law enforcement and "better safeguard China's sovereignty and maritime rights and interests". The new service is being equipped with ships from the four bodies being eliminated, along with newly built or repurposed craft that could make it Asia's biggest and most powerful coastguard. The ships are believed to be lightly armed with machine guns and possibly cannons. The Japanese coastguard said the Chinese vessels were apparently taking the place of ships from China Marine Surveillance, one of the bodies being absorbed by the new service. Those ships had been patrolling in the area for the past eight days as part of a regular Chinese presence in the area. Since an escalation of tensions over the islands, Japanese and Chinese patrol craft have confronted each other on a regular basis in the waters surrounding them, although no clashes have been reported. ^ top ^

Vice-President's North Korea trip shows Pyongyang still key partner (SCMP)
2013-07-25
Vice-President Li Yuanchao sets off for North Korea today to commemorate the 60th anniversary of the Korean war in a visit that analysts say shows Beijing still regards Pyongyang as a close partner. Foreign Ministry spokesman Hong Lei said in a statement yesterday that Li would begin his visit to Pyongyang today and end it on Sunday. Li, who narrowly missed a spot on the Politburo's supreme Standing Committee last year, is the highest-ranking Chinese official to visit North Korea since Kim Jong-un succeeded his father as leader of the impoverished country in December 2011. Li will attend events marking the 60th anniversary of the end of the Korean war, in which China fought on Pyongyang's side against forces led by the US. Hong's statement did not say whether Li would meet top North Korean leaders, but observers expect that a meeting with Kim is likely to take place. Chinese state-media ran extensive commentaries of the 1950-53 conflict yesterday, saying Beijing's assistance to Pyongyang had contributed to peace in the region for six decades. "China was fighting for peace and defending the nations," wrote Qian Lihua, a former director of the Ministry of National Defence's foreign affairs office, in the overseas edition of the People's Daily. "However, 60 years after the war, there is still no real peace. "The only solution to tackle problems facing the Korean peninsula is negotiation and dialogue on an equal basis." Li's trip comes amid concern among some in the Communist Party that Beijing was too tough on North Korea following Pyongyang's nuclear test and rocket launches earlier this year. Beijing joined the US to back United Nations sanctions against the North. Tensions across the Yalu River have eased since Kim's envoy, Choe Ryong-hae, visited Beijing in May and met President Xi Jinping. North Korea's first vice-minister of foreign affairs, Kim Gye-gwan, also visited China earlier this month. "The visit of Li to Pyongyang probably signifies that China still considers North Korea as a very important and close partner," said Cui Zhiying, director of Tongji University's Korean Peninsula Research Centre. "The two nations are also expected to strengthen economic and trade co-operation." Cai Jian, deputy director of Fudan University's Centre for Korean Studies, said Beijing and Pyongyang strategically needed each other. Pyongyang relies on Beijing's diplomatic support, while the collapse of North Korea would be detrimental to Beijing's efforts to offset US influence in the region, he said. Cai said Kim resorted to military actions to consolidate his authority amid intense speculation of a power struggle in Pyongyang, and is likely to seek Chinese economic support to help legitimise his rule. Beijing is expected to urge Pyongyang to stop its provocative behaviour and focus on economic development, Cai said. ^ top ^

China, Australia vow to speed up FTA talks (Xinhua)
2013-07-25
China and Australia on Wednesday vowed to speed up negotiations on a bilateral free trade agreement (FTA) when Chinese Vice Premier Wang Yang met with Australian Trade Minister Richard Marles in Beijing. Wang said he hopes the two countries can reach the FTA soon, so as to enrich the content of their bilateral strategic partnership. Marles said the Australian government attaches great importance to the development of bilateral trade relations. The Australian side is willing to show flexibility and will actively push for progress in the FTA negotiations, he said. Also on Wednesday, Wang met with EU Agriculture Commissioner Dacian Ciolos. Wang said the two sides should give full play to each other's advantages to push forward the in-depth development of China-EU agricultural cooperation and jointly cope with challenges facing the agricultural sector. Ciolos said the EU attaches importance to agricultural cooperation with China and is ready to carry out the bilateral cooperation program on agriculture and rural development. ^ top ^

Chinese FM meets Armenian counterpart (Xinhua)
2013-07-25
Chinese Foreign Minister Wang Yi and his visiting Armenian counterpart Edward Nalbandian held talks on Thursday. The Chinese government attached importance to developing ties with Armenia, Wang said, adding that China will work with Armenia to deepen cooperation, strengthen coordination on international and regional issues and advance bilateral relations to a higher level. The most significant feature of China-Armenia relations is that the two sides have "mutual respect and support for each other," Wang said. Nalbandian spoke positively of the development of Armenia-China relations and said his country is willing to work with China to boost bilateral ties. ^ top ^

Vietnam president: We oppose China's nine-dash line claim (SCMP)
2013-07-26
Vietnam's president on Thursday voiced firm opposition to China's claims in the South China Sea but declined to back a Philippine bid to take the row to a UN tribunal. On a visit to Washington, President Truong Tan Sang rejected China's so-called “nine-dash line” through which it claims virtually all of the strategic sea including islands close to neighbouring countries. “We cannot find any legal foundation or scientific basis for such a claim and therefore it is the consistent policy of Vietnam to oppose the nine-dash line plan by China,” Sang told the Center for Strategic and International Studies. But Sang declined comment when asked if Vietnam would join the Philippines which in January said it was asking an arbitration panel of the UN Convention on the Law of the Sea to declare China's claims invalid. “As a member of the United Nations, the Philippines has the legal right to carry on with any proceedings they would like,” Sang said. The Philippines and Vietnam have led criticism of what they consider increasingly assertive claims by China in the South China Sea. The Philippines has had especially tense relations with China, which seized the Scarborough Shoal, an outcrop claimed by Manila, after a two-month naval standoff last year. But friction has eased slightly between Vietnam and China, with Sang visiting Beijing last month and agreeing to set up a hotline to try to prevent mishaps from escalating. China separately has increasingly butted heads with Japan, which fears that Beijing is trying to exert control over resource-rich waters in the East China Sea. Sang earlier Thursday met US President Barack Obama, who encouraged calm in the South China Sea. Sang and Obama in a joint statement called for “the settlement of disputes by peaceful means” and renewed support for a code of conduct to manage potential mishaps. ^ top ^

6.6-magnitude quake hits NW China (Xinhua)
2013-07-22
A 6.6-magnitude earthquake jolted a juncture region of two counties in northwest China's Gansu Province Monday morning. The earthquake occurred at 7:45 a.m. at the junction of the Minxian County and Zhangxian County, according to the China Earthquake Networks Center. The local people in the Minxian County said strong tremor was felt and they saw noticeable shake of trees and homes, adding that the quake lasted for about one minute. Meanwhile, the earthquake was also felt in neighboring cities of Dingxi, Longnan, Tianshui, as well as the provincial capital city of Lanzhou. Xi'an City, capital of the neighboring Shaanxi Province was also reported to have felt the quake. Causalities are still unknown. Xinhua reporters are rushing to the quake-stricken area. The epicenter, with a depth of 20 km, was monitored at 34.5 degrees north latitude and 104.2 degrees east longitude, said the center. ^ top ^

89 dead after earthquake strikes Gansu counties (SCMP)
2013-07-23
At least 89 people were killed and hundreds were injured when a powerful earthquake struck near Min and Zhang counties in Dingxi, Gansu, yesterday morning. The 6.6-magnitude quake struck at 7.45am at a depth of 20 kilometres, says the China Earthquake Networks Centre. At least 628 people were reported injured and five missing. Aftershocks followed, and 422 had been recorded by 6pm, the strongest being 5.6. About 20 per cent of all homes collapsed in the epicentre, Min's Dacaotan township, and 60 per cent of the remaining homes suffered damage such as cracks. Economic losses in Zhang were estimated at 190 million yuan (HK$238 million). [...] Communications were reportedly down for about an hour in the areas heaviest hit. Many residents also lost power, but emergency workers restored electricity to about half of the 14,000 houses in Dingxi by 4pm. Rescue efforts were under way, and thousands of people, including soldiers, firefighters and medical personnel, were deployed to quake-affected areas. The Ministry of Civil Affairs allocated 10,000 tents, 30,000 quilts, 5,000 foldable beds and 10,000 sleeping bags to Gansu. The Gansu provincial government also sent tents, quilts and folding beds to the two counties, but the two hospitals treating the injured said they urgently needed medicine. Min's hospital of traditional Chinese medicine said it had admitted 283 survivors and were short on beds and drugs. The provincial public security department imposed a traffic ban on several major roads leading to Min and Zhang to ensure priority for emergency vehicles. Rain was expected today, with lighter showers tomorrow. "The rain may have an adverse effect on rescue efforts - please pay attention and be on guard," the Dingxi government advised. ^ top ^

Hot topics loom at Beidaihe summer summit as Chinese leaders meet to discuss reform (SCMP)
2013-07-23
A year ago, Communist Party chiefs convened a secretive conclave in the seaside town of Beidaihe to finalise plans to hand over power to a new generation of leaders in the wake of the most serious crisis in years. Twelve months on, the new leaders are gathering for their first summer summit to discuss their policy agenda for a crucial party plenum this autumn. They may also discuss the handling of the case that sparked last year's crisis - that of the disgraced Chongqing party chief Bo Xilai. The Beidaihe meeting, or "summer summit" as it is known to China watchers, is an opportunity for the nation's leaders to meet in a relaxed and informal setting to discuss and set the tone for major domestic issues. Such is the level of secrecy that the meeting's existence is rarely acknowledged by state media. The first signal that it was under way last year was the presence of key leaders in Beidaihe. But activity in the resort town in Hebei province hints that the third plenary meeting of the Communist Party Central Committee is imminent. "The Politburo will almost certainly meet before the end of this month to decide policy direction for the coming year and set the agenda for the third plenum," said Deng Yuwen, former deputy editor of Study Times, a key publication run by the Central Party School. Analysts noted that the seven most senior officials from the Politburo Standing Committee had all made inspection trips across the country earlier this month to "prepare for the upcoming series of important meetings". The analysts expect President Xi Jinping and second-in-command Premier Li Keqiang to use the plenum to unveil their political and economic agendas. Steve Tsang, professor of Contemporary Chinese Studies and director of the China Policy Institute at Nottingham University in Britain, said: "I think Xi will try to use his 'honeymoon' period to push forward his reform agenda. What we have seen so far, particularly party reforms, will probably figure high on the list." […] Analysts expect the meeting will also decide on how to deal with the case of Bo, with the party eager to put one of its worst scandals behind it. Reports by media outlets close to the government - such as people.com and websites run by Hong Kong's pro-Beijing newspapers Ta Kung Pao and Wen Wei Po - said Bo's trial would take place soon at a local court in Jinan, Shandong province. They said the municipal court had rehearsed how it would handle courtroom crowds and intense media interest during Bo's trial on charges of corruption and abuse of power. Bo has been reportedly held at Qincheng prison in Beijing and many believe his trial is imminent after the completion of the trial of former railways minister Liu Zhijun, who received a suspended death sentence on July 8 for taking almost 60 million yuan (HK$75 million) in bribes. Deng said that how Bo's case was handled would be a test for the new leadership. He said: "Dealing with Bo will be controversial as it will not satisfy all the various factions within the party, certain retired leaders and the princelings [their children]. And any deal will also be debated among the public." […] Analysts also say the Politburo is likely to discuss crucial reform proposals to be tabled at the plenum. […] Li, of City University, said key issues that could be on the table in Beidaihe included "measures to deal with the economic slowdown; concrete steps to push forward Xi's 'mass line' rectification campaign (an attempt to stay in touch with the views of ordinary citizens); and social conflicts caused by environment deterioration and corruption at different levels of party and government organisations". Li said the meeting was also expected to work on conceptual and theoretical guidelines to strengthen the main ideas of Xi's Chinese dream, a slogan Xi has often used since becoming party leader last November to encapsulate his vision of a revitalised nation. But Li added: "More likely, the meeting will work on specific measures to deal with urgent issues that threaten the credibility of the party and government and pose risks to the legitimacy of the party to continue holding power." Jianguang Shen, chief China economist at Mizuho Securities Asia, said that implementing bold economic reforms that could sustain growth had become imperative for the new leadership amid an unprecedented slowdown. In a research report released on May 13, Barclays chief economist Huang Yiping said seven reform proposals - in the financial sector, the fiscal system, land tenure, prices, bureaucracy, income distribution and household registration - would be presented at the third plenum. Shen said that since Li became premier in March, he had introduced a series of economic measures, including financial reforms, elimination of administrative red tape, financial deleveraging and urbanisation. He believed that the plenum would be likely to endorse Li's economic philosophy, dubbed "Likonomics" by the media. "The three pillars of Likonomics are liberalising key prices, including interest and exchange rates; eliminating entry barriers and red tape; and deepening reforms that will guide China's reform in coming years," Shen said. It was at another third plenum in late 1978 that Deng Xiaoping and his allies inaugurated a series of economic measures that launched China's capitalistic reform and "opening up". Hopes are now high that the upcoming summit in Beidaihe will revive further long-stalled market reforms. ^ top ^

Aid needed in quake-hit regions (China Daily)
2013-07-24
Relief materials are urgently needed in quake-hit areas in Gansu province, local officials said. Zhang Yidu, deputy mayor of Dingxi, said Zhangxian and Minxian counties are in great need of 14,000 tents, 24,000 quilts, food, drinking water, as well as medical facilities and medicine. Zhang said the counties also lack necessities such as beds, generators and emergency lighting. Food and drinking water have been distributed to residents in the worst-hit areas, but people living in villages that were less affected are still struggling with the most basic necessities, officials told China Daily on Tuesday. “What we need most are quilts, a lot of quilts,” said Dong Caiwa, head of Lalu village, one of the severely affected areas. “The temperature at night is usually 12 or 13 degrees colder than the daytime, so people will possibly fall ill without a tent, quilt or heating equipment.” Eight people from Lalu were killed in the quake, and 20 were seriously injured. Tents and quilts are also in short supply in the village of Yongxing, the quake's epicenter, with many residents having to share one tent. A total of 300 tents, 4,000 quilts and 6,000 clothing items from the Red Cross Society of China have been transported to the affected regions, and more than 4,000 quilts have been sent to Minxian county by the provincial disaster relief materials depository. According to Gansu Civil Affairs Bureau, 12,480 tents, 15,000 quilts, 28,350 cases of instant noodles, and a large amount of drinking water, candles and clothes have been collected from around the nation till 4 pm on Tuesday. However, it will take some time before every resident in the quake-hit areas receives these materials due to traffic congestion and limited transport capability, officials said. As of press time on Tuesday, the death toll from the magnitude-6.6 earthquake that jolted Minxian and Zhangxian counties on Monday morning had risen to 95. The disaster injured more than 1,000 people, according to the Gansu provincial earthquake emergency response center. An initial investigation showed the quake caused 51,800 houses to collapse and severely damaged around 240,000. More than 2,800 troops, 280 vehicles and two helicopters from the Lanzhou Military Command of the People's Liberation Army have been allocated to the rescue and relief work, and they are joined by more than 1,600 People's Armed Police officers. “Since our base is quite far from the quake-hit region, we arrived here at 4 pm yesterday (on Monday),” said Zheng Xiangli, a publicity officer with the forest patrol regiment of the People's Armed Police in Longnan, a neighboring city in Gansu. “The traffic was a headache partly because the roads were heavily damaged. Moreover, too many vehicles from outside were trying to enter the quake-hit areas. We had to walk one hour on a mountainous trail to get to Lalu,” he said. The soldiers have helped villagers pitch tents and tear down damaged walls that were prone to collapse, he said, adding the priority has shifted to retrieving residents' belongings, especially food and quilts. Stormy weather could cause more troubles. Rain is expected in the quake-hit areas through Thursday, according to the weather forecast. The rainfall will cause temperatures to drop and make rescue efforts more difficult, the local government said. The provincial flood control headquarter has asked workers to be prepared for possible emergencies. Medical personnel said the rainfall will add difficulties to their work. “Some residents have caught colds and several people have diarrhea,” said Lin Zhiqian, a doctor from Hetuo Township Hospital. “We have sent workers to spray disinfectant and distribute sterilizing pills to villagers.”. ^ top ^

Xi names low-key outsider as personal secretary (SCMP)
2013-07-25
A rising political star known for his ability to keep a low profile while carrying out the will of his boss has been appointed President Xi Jinping's personal secretary. Ding Xuexiang, who was seen accompanying Xi during his three-day trip to Hubei this week, has been formally appointed director of the General Secretary's Office, as revealed by Hubei Daily yesterday. The tour was Ding's first public appearance since being appointed deputy director of the General Office of the Communist Party's Central Committee in mid-May. Much like former president Hu Jintao's secretary, Chen Shiju, Ding is expected to serve the president and the Central Committee concurrently. A source close to Ding said that he is known for quickly turning his bosses' public remarks on trips into official notices without referring to notes. "Ding boasts some remarkable traits, ranging from perfect writing skills to a famously strong memory," the source said. Ding comes from an unremarkable family in Jiangsu province and has no special political connections in Beijing. Along with his natural low-key personality, that could be a key advantage in his new role. "Xi needs someone with a clean background who does not know too many people in Beijing, so he won't discuss Xi's private thinking with outsiders," said the source. "In this regard, Ding has long ago proven to Xi that he is reliable." Xi's relationship with Ding dates back to March 2007, when the future president was named to succeed the disgraced Chen Liangyu as party secretary in Shanghai. Ding, a deputy secretary general of the municipal party committee, quickly won Xi's confidence and was promoted to the secretary general's post within a couple of months. The source said Ding has also won the confidence and support of Yu Zhengsheng, another former Shanghai party secretary who is now the No 4 member of the Politiburo's decision-making Standing Committee. "Yu, the immediate successor of Xi as Shanghai party secretary in late 2007, hugely appreciates Ding's outstanding ability in drafting speeches on his behalf," the source said. "Ding appeared stunned when he learned that Xi would like him to head his office earlier this year," the source said, adding: "Ding didn't hesitate in planning to end his political career in Shanghai before [taking up his new post]." Other secretaries named by Xi include Zhong Shaojun and He Yiting. In Chinese politics, secretaries often wield great influence during their bosses' time in power and often move on to promotion in their political careers. Xi himself served as the secretary of former defence minister Geng Biao from 1979 to 1982. Current Politburo member Li Jianguo was once the secretary of former Standing Committee member Li Ruihuan in 1980s. ^ top ^

Li points way for railways reform (China Daily)
2013-07-25
Premier Li Keqiang called on Wednesday for reform of funding methods for railways and for accelerated rail construction in central and western regions. Experts said the measures are part of efforts to stabilize economic growth, which slowed to 7.5 percent in the second quarter, and will help China's industrial sector amid the economic slowdown. The railway construction market will be "fully opened" through reform, and the building of rail facilities in less-developed areas will be emphasized, Li said at an executive meeting of the State Council, China's cabinet. "This will usher in balanced development among different regions, as well as steady advancement of urbanization," he said. The premier called for multiple fundraising sources for railway construction, including a greater role for private capital and the establishment of a railway development fund. Intercity railways' ownership and management rights will be open to private and local investors, Li said, while calling for rail projects under construction to be completed on schedule. The reform move follows the establishment of the China Railway Corp in March, after a separation of the now-defunct ministry of railways' government and enterprise functions. China Railway Corp still faces uncertainties, as its financial report in the first quarter showed it has debts of more than 2.8 trillion yuan ($456 billion), which are rising each month. Under the development plan drawn up by the former railways ministry, 5,200 km of track was to be completed this year, with a fixed-asset investment of 650 billion yuan. But only one-third of the investment was made in the first half of the year. Luo Renjian, a researcher at the Institute of Transportation Research under the National Development and Reform Commission, said the slower pace of railway construction in the first six months is due to seasonal factors. It will pick up later this year and in the remaining years of the 12th Five-Year Plan (2011-15). "Total railway investment this year will be 690 billion yuan, slightly higher than budget," he said, adding that about half of the funding will come from bank loans, with local governments and private investors spending about 90 billion yuan. Other major funding sources include the railway development fund, income from car purchase tax, financial support from the central government, while the China Railway Corp will be responsible for providing 23 billion yuan, he said. "All funding is guaranteed." Combined railway investment in 2014 and 2015 will be 1.4 trillion yuan under the National Development and Reform Commission's plan, he said, adding that the overall distance covered by the nation's railway system will be 123,000 km by 2020, about 3,000 km more than scheduled. The central government is encouraging the start of new rail projects, especially in western areas where there is more room for development, instead of just focusing on existing ones, Luo said. Wang Mengshu, deputy chief engineer of the China Railway Tunnel Group and a member of the Chinese Academy of Engineering, said the China Railway Corp has been less aggressive in construction after the March reform. But the central government will still be responsible for the majority of funding for future investment, Wang said, as private investors are not yet convinced that they should chip in and investment in western areas is not profitable in the short term. ^ top ^

Disgraced Bo Xilai formally charged over corruption (SCMP)
2013-07-26
Disgraced Politburo member Bo Xilai was formally charged with bribery, embezzlement and abuse of power yesterday, as the new leadership rushes to bring closure to the nation's biggest political scandal in years. Prosecutors in Jinan, capital of Shandong province, gave no date for the trial. Under the Criminal Procedural Law, a court can only open a public trial 10 days after indictment. Wang Zhaofeng, Bo's defence lawyer, said Bo, 64, was in normal physical and mental condition when he met him recently. "[Bo's appearance] remained largely unchanged," Wang said. Bo was officially accused of receiving "extremely large amounts" of bribes, embezzling "extremely large amounts" of public funds and abusing his power of office, Xinhua said, citing the indictment. It said the former Chongqing party chief had caused "heavy losses to the interests of the nation and the people in an extremely serious way". Bo would become the third Politburo member to stand trial in the past two decades, following former Beijing party boss Chen Xitong in 1998 and Shanghai party chief Chen Liangyu in 2008, who received 16 and 18 years' imprisonment respectively. A Tuesday internal meeting in Bo's power base of Chongqing and other cities disclosed that he would be tried on charges of taking 20 million yuan (HK$25.27 million) in bribes, embezzling 5 million yuan and abusing power. "Given the allegations, Bo is likely to face the death sentence with reprieve or life imprisonment, although technically, the 'huge amounts' in bribes can lead to death by law," said Mo Shaoping, a prominent rights lawyer in Beijing. "But such political cases are ruled by authorities rather than by law." As former railways minister Liu Zhijun received a two-year suspended death sentence earlier this month for accepting bribes and gifts worth 64.6 million yuan, it would be almost impossible for Bo to receive capital punishment, Mo said. A senior Chongqing police officer, jailed for two years during Bo's anti-mafia campaign in 2009 after confessing under torture, said he had been waiting for this day for years. "I knew Bo would get punished one day because he went too far in breaching the law," said the policeman, who declined to be named as authorities are still reviewing his appeal. Bo has not been seen in public since March last year, when he was sacked from his Chongqing post amid intrigue surrounding his police chief's flight to the US consulate, telling US diplomats that Bo's wife had been involved in the murder of Neil Heywood, a British businessman who was close to the Bo family. Bo's wife Gu Kailai got a suspended death sentence last August for poisoning Heywood. Bo's right-hand man Wang Lijun was convicted in September and sentenced to 15 years' jail for corruption. Both trials came about two weeks after indictments were announced. Bo was dismissed from all his posts and expelled from the Communist Party in September. The Jinan court could not be reached for comment. ^ top ^

Activists 'detained while celebrating Hu Jia's birthday' (SCMP)
2013-07-26
Prominent mainland activists Hu Jia, Teng Biao and more than a dozen supporters were detained on Thursday night while they were celebrating Hu Jia's 40th birthday at a Shenzhen restaurant, according to Teng. After his release around 11.30pm, Teng told the South China Morning Post plain clothes police held him in a private room in the restaurant for two and a half hours. They then interrogated him over the details of the dinner gathering. Apart from Hu and Teng, 18 people, of whom many were local Shenzhen activists, were also taken away by police for questioning, he said. Hu entrusted his five-year-old daughter, Qianci, to the care of a friend just before they were detained. Teng said police did not produce a warrant and did not give a reason for their detention, but they demanded to know whether the activists had discussed legal scholar Xu Zhiyong's recent criminal detention during dinner. “They were overly-nervous,” Teng said. “They asked whether we were talking about Xu Zhiyong.” Xu, a close friend of Hu and Teng, was detained last week on the criminal charge of “gathering a crowd to disturb order in public places”. Xu last year founded the nationwide New Citizen social initiative - which has advocated democracy, rule of law and civil rights. Many dinner gatherings organised by Xu over the past year have been broken up by police, while he has been barred from leaving home. Many of the participants of New Citizen were involved in a campaign this year urging senior party officials to disclose their assets. Dozens of activists across China have been detained in the past few months. “They have taken away so many people and they are very nervous themselves, so when we got together for dinner, they had to intervene,” Teng said. Teng said he expected government crackdowns on activists would get worse in future. “Ordinary people don't have a sense of security and nor do the officials,” Teng said. “Conflicts in society are becoming sharper and the situation is not going to ease up,” he added. Shenzhen police refused to comment on Thursday night. ^ top ^

Beijing airport bomber's 'mistreatment' case reopened (SCMP)
2013-07-22
Security officials in the Guangdong city of Dongguan have been ordered to reopen the case into an alleged beating eight years ago that paralysed a motorcycle taxi driver who set off a home-made bomb in protest at Beijing's airport on Saturday. The Public Security Bureau in Guangdong asked the Dongguan branch to carry out a thorough investigation into mistreatment claimed by Ji Zhongxing, the bomber, and his ensuing petitions, the national broadcaster CCTV reported yesterday, adding that the probe was already under way. Ji, a 34-year-old Shandong native, detonated the home-made explosive in Terminal 3 of Beijing Capital International Airport on Saturday evening, injuring only himself. The wheelchair-bound petitioner had complained earlier in his weibo account about being beaten and left paralysed in Dongguan by security officials for allegedly trying to evade a random check while driving a motorcycle taxi in the city eight years ago. The Dongguan petitions office issued a statement hours after the explosion stating that in March 2010 police in the city had given 100,000 yuan (HK$125,000) to Ji, who promised to drop any claims, according to the Guangzhou-based Yangcheng Evening News. "Yes, we accepted the 100,000 yuan in relief funds offered by them in my hometown a few years ago," Ji Zhongji, Ji's elder brother, told the Post yesterday, but stressed that he and his brother had rejected the money at first. "We accepted it only when they told us that the money was intended to help us, and signed our names on a sheet of paper," said Ji Zhongji, adding that both men were not sure exactly what was written on the paper as he was illiterate while his younger brother could only read a small amount. "We were then surprised when the officials warned us, as they held the paper in their hands, that we could make no further petitions. Otherwise, we would have to bear full responsibility for anything that happened later." Ji Zhongji said he received a phone message yesterday morning that his younger brother's left hand had been amputated in Beijing Jishuitan Hospital before he was taken by police to an unknown destination. Thousands of internet users expressed support for Ji Zhongxing, particularly after Beijing News reported that he had warned passers-by in the airport minutes before setting off his bomb. "He warned those people... who in this country is willing to stand up and say they are more righteous than him?" Zhao Xiao, a professor at the Beijing Institute of Technology wrote on his Sina Weibo site. Lawyer Yuan Yulai wrote: "By warning others to move away, he is a good person … I hope authorities will be understanding, or they will set off a vicious cycle.". ^ top ^

Beijing airport bomber detained in unknown location (SCMP)
2013-07-23
The wheelchair-bound petitioner who detonated a home-made bomb in protest at Beijing's international airport on Saturday is under criminal detention, mainland media report, while his family say they have lost contact with him. "My brother was so miserable with his injustices, and now, we don't know where he is and what he was arrested for," Ji Zhongji, elder brother of bomber Ji Zhongxing, told the Post yesterday. Ji, a 34-year-old native of Shandong province, had petitioned authorities in Beijing, Guangdong and Shandong for eight years over the crippling injuries he claimed to have suffered as a result of police brutality in Dongguan in 2005. He set off the device packed with gunpowder from fireworks in Terminal 3 of Beijing Capital International Airport. He survived the blast but had his left hand amputated. There were no other injuries. At about midnight yesterday, after surgery at Jishuitan Hospital, he was taken away in an ambulance under police escort to an unknown destination, Shanghai Daily reported. The Beijing News reported that police had detained Ji while they investigated how he arrived at Beijing airport from Shandong, how and when he made the explosives and whether he had an accomplice. [...] Ji Zhongji, the elder brother, said the family had lost contact with Ji. "We are only farmers and migrant workers and have no idea how to help him," he said. "But I'm sure he never meant to hurt anyone else in the blast. He just wanted the public to know his suffering." Southern Metropolis Daily reported that a friend of Ji, also disabled, helped Ji call a taxi to take him to the long-distance bus station from where he set out to Beijing on Saturday morning. Ji had written on his blog that he had been beaten and left paralysed by security officers in Dongguan's Xintang village in June 2005 while driving a motorcycle taxi. He had been petitioning in vain for compensation and to demand that his attackers be punished. Public security officials in Guangdong ordered their colleagues in Dongguan to reopen the case and launch a through investigation. According to the Dongguan petition office, Ji filed a lawsuit against the Xintang village committee in January 2007, seeking 340,000 yuan (HK$425,000) in compensation. Dongguan People's Court rejected the claim in July 2007 on the grounds of insufficient evidence, and the city's intermediate court upheld that decision in January 2008. In March 2010, the township police gave Ji 100,000 yuan before closing the file. "Ji lost the case even though his passenger, Gong Tao, wanted to be a court witness to prove that Ji was badly beaten by auxiliary police officers," said Xu Mingyong, a Dongguan lawyer who represented Li at the time. "The security men insisted Ji had fallen from his motorcycle himself. And, in the end, Gong failed to show up in court because he had lost his ID card. "The court said the evidence we collected - including Gong's statement and records from the hospital - were not enough to prove Ji had been beaten by the men," the lawyer said. "I hope the new investigation will sweep away any doubts about this case.". ^ top ^

Tibetan monk sets himself on fire, report says (SCMP)
2013-07-22
A Tibetan monk died after setting himself on fire in Sichuan province, reports said yesterday, in the first such protest for more than a month. Kunchok Sonam, 18, carried out the protest on Saturday outside a monastery in Aba prefecture, Radio Free Asia said in a report that cited residents in the area. Sonam shouted slogans "crying for Tibetan freedom", the broadcaster, which is funded by the US government, cited a local resident as saying. The self-immolation was the first by a Tibetan on the mainland for five weeks, the report said, adding that his fellow monks had prevented Chinese authorities from taking away Sonam's body after the deadly protest. Restrictions on communication in the area "have been intensified" after the self-immolation, the London-based Free Tibet advocacy group said in a statement. Some 120 Tibetans have set themselves on fire since February 2009 in protests against what they see as Chinese oppression, the Washington-based International Campaign for Tibet said before news of the latest self- immolation emerged. The protests - which reportedly have resulted in dozens of deaths - peaked in the run-up to the Communist Party's pivotal party congress last November, but have become less common in recent months. Beijing condemns the acts and blames them on the Dalai Lama, Tibet's exiled leader, saying he uses them to further a separatist agenda. But some Tibetans and rights groups say the protests are a response to tight controls on religion in the region. The Dalai Lama, who has lived in India since 1959 after a failed uprising, has described the protests as acts of desperation that he is powerless to stop. ^ top ^

Long-time Xinjiang official promoted to central committee (SCMP)
2013-07-23
Beijing has promoted a local official to the Xinjiang Communist Party's central committee in the wake of ethnic violence that has rocked the region. Li Xuejun, 52, who was formerly the party chief of Yili Kazak autonomous prefecture, is a Han Chinese who has spent most of his career in the restive region since 1977, the regional government reported yesterday. Li worked in the region's finance office from 1980 to 2006. In November 2006, he was named party secretary of Changji prefecture, and transferred to Yili in July 2011. A series of bloody clashes in the region in the past several months have killed at least 56 people. Local authorities classified most of the incidents as "terrorist attacks". Security in the regional capital Urumqi was tightened this month during the fourth anniversary of ethnic clashes that killed nearly 200 local Uygurs and Han migrants. The Xinjiang party chief, Zhang Chunxian, met 50 grass-roots officials on Friday, calling on cadres to bring stability to the region. Jiang Zhaoyong, a Beijing-based expert on minority affairs, said Li's promotion was a sign that the authorities wanted to use local officials to help stabilise the region. "Local officials understand more about the religious culture and economic development of the region than those who are transferred from other provinces," Jiang said. ^ top ^

Xi congratulates Ma's re-election as KMT leader (Xinhua)
2013-07-20
Xi Jinping, top leader of the Communist Party of China (CPC), sent a congratulatory message to Ma Ying-jeou, who was re-elected chairman of the Kuomintang (KMT) Saturday, sources from the CPC Central Committee said. Xi, general secretary of the CPC Central Committee, said in the telegraph that he hoped the two parties could deepen mutual trust and introduce positive interaction with boarder vision when cross-Strait relations are facing important opportunities. The CPC and KMT should continue to push forward the comprehensive development of cross-Strait relations and work together for the interests of compatriots across the Taiwan Strait and revival of the Chinese nation, Xi said. In his reply to Xi's message, Ma expressed his gratitude to Xi's congratulation, saying that cross-Strait relations have made considerable progress under the principle of the 1992 Consensus, agreed by the mainland and Taiwan, since the KMT became the ruling party five years ago. The improving relations have greatly promoted peace and prosperity on both sides of the Taiwan Strait and benefited people's well-being, Ma said. Ma said he expected the two parties to expand and deepen cooperation and exchanges, further promote the Chinese culture, realize the revival of Chinese nation and work for an eternal peace and prosperity across the Strait. Ma had held the position of KMT chairman since 2009. He was elected Taiwan's regional leader in 2008 and re-elected in 2012. ^ top ^

China manufacturing slips to 11-month low, signalling slowdown (SCMP)
2013-07-24
Activity in China's vast manufacturing sector slowed to an 11-month low in July as new orders faltered and the job market darkened, a preliminary survey showed on Wednesday, suggesting the world's second-largest economy is still losing momentum. The flash HSBC/Markit Purchasing Managers' Index fell to 47.7 this month from June's final reading of 48.2, marking a third straight month below the watershed 50 line which demarcates expansion of activities from contraction. It was the weakest level since August last year. “The lower reading of the July HSBC Flash China Manufacturing PMI suggests a continuous slowdown in manufacturing sectors thanks to weaker new orders and faster destocking,” said Hongbin Qu, chief China economist of HSBC. “This adds more pressure on the labour market,” he said. A sub-index measuring employment slid to 47.3 in July, the weakest since March 2009. It stood at 47.6 in June and has been below 50 for four months in a row. The new orders sub-index fell to its lowest level in 11 months, and stayed below 50 for a third straight month. Output declined to 10-month low and remained in contraction for a second month. The HSBC/Markit Flash PMI is published about a week before the final reading, and is based on approximately 85-90 per cent of total PMI survey responses each month. It is the earliest available indicator of monthly activity in the Chinese economy. “As Beijing has recently stressed securing the minimum level of growth required to ensure stable employment, the flash PMI reinforces the need to introduce additional fine-tuning measures to stabilise growth,” Qu said. Economists say the new government believes an annual growth rate of 7 per cent is needed to create enough jobs to maintain social stability, although the top leaders have never specified a figure. China's economy grew 7.5 per cent in the April-June period from a year earlier, the ninth quarter of slowdown in the past 10 quarters. China's new leadership has said that it is prepared to tolerate lower growth and eschew stimulus in order to push a restructuring of the economy to wean it off a dependence on exports for growth and towards consumption. It is fine-tuning policy, however, in response to the growth slowdown, and last week scrapped the floor on bank lending rates to help lower financial costs for companies. President Xi Jinping said in remarks published on Tuesday that the key to dealing with various challenges confronting the economy was to deepen reforms in all aspects. With no big stimulus measures in sight, economists in the latest Reuters poll predicted China's economy would grow 7.5 per cent this year, hitting the government's target. ^ top ^

China to suspend VAT for small businesses (Xinhua)
2013-07-25
China will suspend the value-added tax (VAT) and turnover tax for small businesses with monthly sales of less than 20,000 yuan (3,226 U.S. dollars) starting from Aug. 1. The announcement was made in a statement released Wednesday after an executive meeting of the State Council presided over by Premier Li Keqiang. The move will benefit more than six million small companies and boost the employment and income for tens of millions of people, the statement said. VAT refers to a tax levied on the difference between a commodity's price before taxes and its cost of production. Turnover tax refers to a levy on a business's gross revenues. The State Council also discussed measures to facilitate foreign trade and stabilize exports, such as simplifying customs clearance procedures, cutting operational fees, increasing financial support for profitable companies, facilitating the exports of small and mid-sized private enterprises, increasing imports and maintaining a stable yuan exchange rate. China's economic growth slowed to 7.5 percent in the second quarter of 2013, down from 7.7 percent during the first quarter. Officials attending Wednesday's executive meeting, however, said the economy is still running within a suitable range. They agreed that more efforts should be made to create a fair, open and convenient market environment, motivate market players and enhance construction in weak areas of the economy, so as to ensure that the economy can develop in a sustainable and healthy way, the statement said. The statement also said the government will fully open up its railway construction market through reforms and give priority to railway construction in central and west China, as well as poor regions. ^ top ^

ROK-DPRK industrial park talks end without agreement (China Daily)
2013-07-23
The fifth round of talks between the Republic of Korea and the Democratic People's Republic of Korea on reopening the industrial park in Kaesong ended on Monday without a major agreement. Although no substantial progress was made in the working-level talks on Monday, the two sides agreed to hold the next round on Thursday, Seoul-based Yonhap News Agency said. The ROK and DPRK need more time to build mutual trust before reaching a deal, but they could still reach an agreement in the future because both sides want to reopen the jointly operated industrial park, observers said. "It is the lack of mutual trust that hinders progress in the negotiations, and it is not so easy for Seoul and Pyongyang to solve this issue in the short term", said Wang Junsheng, a researcher at the Chinese Academy of Social Sciences. Pyongyang and Seoul both see the outcome of the negotiations as a barometer for their future ties, said Gao Haorong, an expert on DPRK studies with the Xinhua Center for World Affairs Studies — a think tank under Xinhua News Agency. "Both of them want to seize the initiative in their future relations," Gao said. Pyongyang and Seoul have held four rounds of talks on this issue, after they agreed in principle to normalize operations of the joint industrial park earlier this month. ROK President Park Geun-hye has attached great importance to the talks, calling them an "important basis for principles and frameworks for establishing new inter-Korean relations". Seoul has called on Pyongyang to provide clear assurances that it will not unilaterally shut down the complex. But the DPRK argued that it was forced to make the decision by hostile ROK actions and intimidation — in particular a series of joint military exercises with its ally the United States. The ROK also demanded that the industrial zone should be developed into an international factory park by allowing foreign companies to invest there. Seoul's demands make the DPRK reluctant to come to an agreement, Wang said, because Pyongyang worries that the employees of ROK companies in the park, which is in the DPRK's territory, may seek to overthrow the DPRK government. Washington's hard-line stance and strict sanctions toward the DPRK also play a role in hindering the talks, although it has expressed support for the communications with the DPRK, Gao said. "It's better for the two sides to focus on reopening the park right now, and talk about their ties later," Wang said. The Kaesong industrial zone has been suspended since early April, when Pyongyang pulled out around 53,000 of its workers in protest at the annual joint military drill between Seoul and Washington. The industrial zone, where 123 ROK companies operate factories, was established in 2004 as a rare symbol of inter-Korean cooperation. ^ top ^

DPRK halt on rocket facility confirmed (China Daily)
2013-07-24
Fresh satellite images confirm that the Democratic People's Republic of Korea has halted construction on a facility to launch a new generation of long-range rockets, a United States research institute said on Tuesday. The building of a new launch pad, rocket assembly building and launch control center at the Tonghae Satellite Launching Ground slowed and then stopped around September 2012. "While it was expected that construction would continue this spring, new imagery indicates that work had not resumed as of late May 2013, almost eight months later," the US-Korea Institute at Johns Hopkins University posted on its 38 North website. The new facilities were intended to handle rockets larger than Pyongyang's Unha-3 space launch vehicle, which successfully placed a satellite in orbit this past December. Although tagged by Pyongyang as a purely scientific mission, that launch was seen by the international community as a disguised ballistic missile test and was punished by additional United Nations sanctions. The 38 North website said it was unclear why work at the Tonghae site had been halted. Initial speculation that it was due to construction teams being sent elsewhere to repair widespread typhoon damage now seems unlikely given the eight-month time lapse, it added. "If work resumes, completion of the new launch facilities... would appear to be at least a year behind the estimate of their original (2016) schedule," the website said. The website speculated that Pyongyang may have decided that one launch pad capable of handling larger rockets than the Unha - located at the more modern Sohae facility - was sufficient to press ahead. "An alternative explanation is that Pyongyang may have decided to slow or even end its efforts to build larger rockets," it said. Such a step would mark a major policy change. Despite international criticism and UN sanctions, the DPRK has repeatedly made it clear that it intends to pursue a missile program, which it sees as a key component of an effective nuclear deterrent. During the recent surge in military tensions on the Korean peninsula that followed the December rocket launch and its nuclear test in February, Pyongyang warned it had the ability to deliver nuclear warheads as far as the continental US. Most experts say such claims are exaggerated, but Washington announced in March that it was deploying new missile interceptor batteries in Alaska in order to "stay ahead" of the nuclear threat from the DPRK. ^ top ^

Top DPRK leader meets Chinese vice-president on relations (Xinhua)
2013-07-25
Kim Jong Un, top leader of the Democratic People's Republic of Korea (DPRK), met here Thursday with visiting Chinese Vice-President Li Yuanchao to discuss relations between their two countries. Li arrived here earlier in the day to pay a visit to the DPRK and to attend activities marking the 60th anniversary of the Korea War Armistice. During the meeting with Kim, Li said the anniversary was a chance to remember the outstanding sons and daughters of China and the DPRK who sacrificed their lives to defend their homelands. "Reviewing history, we deeply feel that today's peace is hard earned and should be cherished doubly," said Li, who is also a member of the Political Bureau of the Central Committee of the Communist Party of China. The China-DPRK relationship was entering a new period that built on the past and prepared for the future, Li said, adding China was willing to work with the DPRK to strengthen mutual trust and communications, expand exchanges and cooperation in various fields, and advance bilateral ties. Li noted that, as a neighbor of the Korean Peninsula, China persisted in the realization of its denuclearization and the maintenance of its peace and stability. China insisted problems should be solved by dialogue and negotiation, he said. Li said China would like to push the resumption of the Six-Party Talks and devote itself to the denuclearization of the Korean Peninsula together with all related parties, in a bid to achieve peace in the region. Kim, first chairman of the DPRK's National Defense Commission, said the Workers' Party of Korea and the DPRK people would remember the martyrs of the DPRK and China who sacrificed in the war forever. The DPRK highly regarded the great achievements of China's socialist cause, and valued its traditional friendship with China, he said, adding his country was willing to promote its communication and cooperation with China, and push the development of the two countries' relationship. Kim said the DPRK was dedicated to developing its economy and improving its people's lives, which required a stable outer environment. The DPRK supported China's efforts to restart the Six-Party Talks, and would like to make efforts with all parties to protect the peace and stability of the Korean Peninsula, he said. Li, who conveyed a message from Chinese President Xi Jinping to Kim, also met with Chairman Kim Yong Nam and Vice-Chairman Yang Hyong-sop of the Presidium of the Supreme People's Assembly of the DPRK earlier Thursday. ^ top ^

Vice president's Pyongyang trip aims to unfray Sino-N.Korean ties (Global Times)
2013-07-26
Chinese Vice President Li Yuanchao arrived in Pyongyang on Thursday to attend activities in commemoration of the 60th anniversary for the truce of the Korea War (1950-53) in a trip that analysts said is expected to reshape ties between China and North Korea. Li is the highest ranking Chinese official to visit the North since Kim Jong-un took over as leader of the country in December 2011. There are speculations that Li would hand over a personal letter to Kim from Chinese President Xi Jinping, but Zhang Liangui, an expert on Korean issues from the International Strategic Research Bureau at the Party School of the Central Committee of the Communist Party of China, said judging from official statements from the two countries so far, such a scenario is unlikely. "Li is not visiting as a special envoy of Xi, so I think he might verbally convey messages of Chinese leaders to Kim during their meetings," he noted. On Thursday Kim inaugurated a new cemetery in Pyongyang for veterans of the Korean War designated as "heroes of the republic," AFP reported. The North is also preparing Saturday's parade of military hardware, a major part of the 60th anniversary of the war that Pyongyang is eager to have foreign delegations witness. Although the Chinese Foreign Ministry said the trip is for the anniversary of the armistice of the war, the international community is closely watching whether leaders of the two countries will discuss the North Korean nuclear issue. Relations between China and the North cooled following Pyongyang's third nuclear test in February. "Li is likely to repeat China's position of denuclearization of the Korean Peninsula and urge the North to return to the Six-Party Talks in meetings with North Korean leaders," Zhang said. "But the North has repeatedly vowed not to give up its nuclear rights, so Pyongyang's response to China's policy this time will decide how their relations will be reshaped in the near future," he added. ^ top ^

17th International Marathon 2013 Mongolia (news.mn)
2013-07-23
The Steppe Marathon, or 17th International Marathon commenced at 2pm on 21st July near Tsonjin Boldog, the giant Chinggis Khaan statue. The Steppe Marathon is held annually in July and is open to the foreign community. Foreign embassies and international organisations working in Mongolia often participate in this marathon. Starting from Mandal resort the international marathon consisted of six race categories. The organisers arranged a children"s race of 1500km, a race for over 60s of 3000m, a 5000m race for competitors aged 50 to 60 and a 5000m race for competitors under 50 years. The 10km race and half marathon, 21km, was open to all ages. Runners from Mongolia and the international community took part in the event. Japan, America, the UK and France were some of the countries that were represented. The Office of the Mayor of Ulaanbaatar, the Ulaanbaatar City Tourism Board, the Physical Culture and Sports Authority and the Embassy of Japan were involved in the organisation of the event with Mobicom being the primary sponsor this year. ^ top ^

State Bank takes over insolvent Khadgalamj Bank (UB Post)
2013-07-25
Khadgalamj bank account holders will not lose after the State Bank take over, said the Central Bank. Mongolia's fifth-largest lender, Khadgalamj Bank, has been taken over by the government-owned State Bank after it was declared insolvent when affiliated companies defaulted on loans. The defaults left the bank with a total loss of 180 billion MNT (approximately 122 million USD), according to spokespersons from the banks in a press conference held on Monday. “In accordance with the bank's policies and acting director, on June 22, the active and passive assets of Khadgalamj Bank, all of its branches, and employees will be transferred to the State Bank's control. This decision was reached on the basis that it is less costly than implementing structural reform at the bank. Starting [Monday], the bank's interests, customers and account holders will be transferred to State Bank. Khadgalamj Bank's state services and transactions will go through the State Bank. This ensures safety for the bank's interests, including its 1.7 million customers, and 980 billion MNT in financial interest. At the moment, no request to buy the bank, in relation to its insolvency, has been made to the Central Bank of Mongolia,” said Danjilaa Ganbat, director of the banking supervision department at Mongol Bank. ^ top ^

Mongolia's debt to Chalco will be paid off within this year, said Deputy Minister of Mining O.Erdenebulgan (Info Mongolia)
2013-07-25
The Ministry of Mining of Mongolia organizes the "Transparent Mining" press conference every month to report their main operations in geology and mining sectors. Today, July 25, the Ministry organized their regular meeting chaired by Deputy Minister of Mining O.Erdenebulgan to provide comprehensive information. The most important event of this month was, of course, Oyu Tolgoi's first export. By the demand of the Mongolian shareholders, Oyu Tolgoi presented their Product Sales Agreement and agreed to transfer the product sales income through any account of Mongolian banks. The Oyu Tolgoi mineral concentrator has the capacity to refine 100 thousand tons ore in 1 day and the company plans to refine around 35 million tons ore and export around 1 million ton copper concentrate in a year. The start of Oyu Tolgoi concentrate exports increases the percentage of copper concentrate produced in Mongolia by 80%, total export growth by 30-40%, amount of mining products of GDP by 20% and enables Mongolia to list in the first 15 out of the 50 countries exploiting copper. “Erdenes Tavan Tolgoi” JSC began the soil stripping of West Tsankhi (Block) of Tavan Tolgoi mining site on February 16, 2013 and currently, the mining in the west and east area of Tavan Tolgoi is in operation. The “Erdenes Tavan Tolgoi” JSC exploited 1 million ton coal in 2011, 2 million 504 thousand tons coal in 2012 and exported 2.5 million tons coal by the end of 2012. 834.3 thousand tons coal out of the planned 6 million tons coal has been exploited from the East Tsankhi in 2013, exporting 372,366 tons coal. 128.6 thousand tons out of the planned 2.5 million tons coal has been exploited from the West Tsankhi in 2013. The coal exploited from the East Tsankhi is being exported to the Chinese Chalco company, as agreed, and the money will be deducted from the prepayment loan of 350 million USD. As of today, over 170 million USD is left to cover the Chalco's loan. According to agreements, coal prices became 47 USD per ton starting from this year's third quarter. If this price does not go up, the Chalco debt will be paid off within this year by supplying 3.6 million tons of coal. In the scope of the "Darkhan-Petroleum" plant in Mongolia, the sides are completing the preparations within the set schedule in order to start the utilization of the first oil refinery plant during the first half of 2016. With the establishment of agreement to develop technical blueprints between the Ministry of Mining, Toyo Engineering Corporation of Japan, and the DGTBU LLC on May 17, 2013, the research work was able to commence and engineering calculations and research work are underway. The environment impact report is ready and was verified by the Ministry of Environment and Green Development during their Board meeting held on July 09, 2013. Out of the 30 fields with hydrocarbon exploration in Mongolia, 21 fields are in oil operations by the Product Distribution Agreement principle. In Mongolia, 18,017 barrels or 2,411 tons oil is exploited in one day and 16,860 barrels or 2,257 tons oil is exported. Out of the total 4,543,350 barrels or 608,325 tons oil exploited in 2013, as of July 17, 2,491,096 barrels or 333,891 tons oil has been exploited and 2,364,052 barrels or 316,845 tons have been exported. Except the state fuel reserve that is being currently stored under the National Emergency Management Agency for disaster and emergency situations, there is also 12,700 tons fuel reserved for the same purpose. As of July 23, 2013, companies in oil product trades have a total reserve of 100,100 tons throughout the country or 42 days of general use, of which 41 days of A-80 fuel, 58 days of AI-92, 31 days of diesel fuel, and 38 days of TS-1 fuel (jet fuel). ^ top ^

Andrin Eichin
Embassy of Switzerland