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

Der wöchentliche Presserückblick der Schweizer Botschaft in der VR China
The Weekly Press Review of the Swiss Embassy in the People's Republic of China
La revue de presse hebdomadaire de l'Ambassade de Suisse en RP de Chine
  26-29.5.15, No. 574  
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Foreign Policy

China, Russia vow to boost cooperation on regional, global issues (Xinhua)
2015-05-29
Visiting Chinese State Councilor Yang Jiechi held a meeting with Russian Security Council Secretary Nikolai Patrushev here on Monday and the two discussed issues concerning bilateral ties and the current global situation. At the 11th round of China-Russia strategic security consultation, Yang and Patrushev reached consensus on a wide range of issues, including maintaining the momentum of high-level interactions. They agreed that China will fully support Russia's efforts to hold the BRICS and SCO summits in Ufa, the capital of Russia's Republic of Bashkortostan, in July. And both sides will prepare for the upcoming visit of Russian President Vladimir Putin to China to commemorate the 70th anniversary of the victory of China' s War of Resistance against Japanese Aggression and the World Anti- Facists War. Both sides agreed to support each other's efforts to safeguard sovereignty, territorial integrity and security and support each other's development and opposed to foreign interference in each other's domestic affairs. China and Russia vowed to boost military cooperation, calling for the security idea featuring collective and comprehensive principles as well as cooperation and sustainability. The two sides opposed protecting one's own security at the expense of the others' interest, or unilaterally develop and deploy anti-missile systems to harm global stability and peace. Beijing and Moscow will constructively cooperate with each other in the Asia-Pacific region in a bid to jointly uphold regional peace, stability and prosperity. With regard to hot-spot regional and global issues, Yang and Patrushev agreed to facilitate the resumption of six-party talks and advance the denuclearization process on the Korean Peninsula. Moreover, they promised to make more efforts to help rebuild peace in Afghanistan, to help clinch comprehensive deals over Iran 's nuclear issue and safeguard peace and stability in the Middle East, as well as to find political solutions to the Ukraine crisis. Yang said that Chinese President Xi Jinping attended the Victory Day celebration in Moscow on May 9 and paid a successful visit to Russia at the invitation of President Putin. China and Russia, the two main battlefields in Asia and Europe during World War II (WWII), have jointly called for upholding the results of WWII as well as the international equity and justice, and proposed to establish a new type of international relations centering around win-win cooperation, which is of practical significance and will bear profound historic influence, Yang added. Leaders of both countries, Yang said, have set the direction of the development of China-Russia relations in the next stage and made clear major areas of cooperation. They agreed to further support each other's core interest and to link China's Silk Road Economic Belt initiative with the development of the Eurasian Economic Union, he added. […] ^ top ^

China to continue to foster new model of military ties with U.S. (Xinhua)
2015-05-29
China's armed forces will continue to foster a new model of military relationship with the U.S. armed forces that conforms to the new model of major-country relations between the two countries, a white paper on China's military strategy says Tuesday. China will strengthen defense dialogues, exchanges and cooperation, with the U.S military, says the document, which is issued by the State Council Information Office. It says China will also continue to improve the confidence-building measure (CBM) mechanism for the notification of major military activities as well as the rules of behavior for safety of air and maritime encounters, so as to strengthen mutual trust, prevent risks and manage crises. According to the document, China's armed forces will also further their exchanges and cooperation with the Russian military within the framework of the comprehensive strategic partnership of coordination between China and Russia. In the spirit of neighborhood diplomacy of friendship, sincerity, reciprocity and inclusiveness, China's armed forces will further develop relations with their counterparts in neighboring countries and work to raise the level of military relations with European counterparts. China's armed forces will continue the traditional friendly military ties with their African, Latin American and Southern Pacific counterparts, it says. It will continue to host multilateral events like the Xiangshan Forum, striving to establish a new framework for security and cooperation conducive to peace, stability and prosperity in the Asia-Pacific region, the document adds. ^ top ^

Chinese vice premier meets Bangladeshi president, prime minister on bilateral ties (Xinhua)
2015-05-29
Visiting Chinese Vice Premier Liu Yandong met with Bangladeshi Prime Minister Sheikh Hasina on Sunday and Bangladeshi President Abul Hamid on Monday on bilateral ties. During the separate meetings, Liu told them that her visit aims to commemorate the 40th anniversary of the establishment of diplomatic ties between China and Bangladesh, promote their traditional friendship, boost the implementation of consensus reached between leaders of the two countries, expand mutually- beneficial cooperation in various fields and promote people-to- people exchanges. China appreciates Bangladesh's support for China's initiatives of "One Belt and One Road" and the Bangladesh-China-India-Myanmar economic corridor and hopes to reinforce bilateral cooperation in economy and trade, agriculture and connectivity, among others, and achieve cooperative win-win and the common development of the two nations as well as the peaceful development of the entire region, the Chinese vice premier said. Liu also expressed the hope that the two nations would promote cooperation and joint development in such sectors as education, culture, technology, media, sanitation and tourism. For their part, both the Bangladeshi president and the prime minister admired the achievements of China's reform and development and appreciated China's support to their country. They also expressed the hope to maintain the momentum of high- level exchanges, deepen cooperation in infrastructure construction and people-to-people exchanges between the two countries so as to jointly realize their development goals. ^ top ^

Beijing lodges formal complaint over US spy plane flight in the South China Sea (SCMP)
2015-05-27
Beijing has lodged a complaint with Washington over a US spy plane that flew over parts of the disputed South China Sea last week. Foreign Ministry spokeswoman Hua Chunying said at a regular press briefing that China urged the US to correct mistakes and avoid “irresponsible words and deeds” about the issue of the South China Sea. The US surveillance jet flew over areas where China is building artificial islands. Washington has called the flight entirely appropriate, but China has said it endangered the security of its islands and reefs. A Chinese state-owned newspaper, the Global Times, said on Monday that “war is inevitable” between China and the United States over the South China Sea unless Washington stops demanding Beijing halt the building of artificial islands. The newspaper, an influential nationalist tabloid owned by the ruling Communist Party's official newspaper the People's Daily, said in an editorial that China was determined to finish its construction work, calling it the country's most important bottom line. The editorial comes amid rising tensions over China's land reclamation in the Spratly archipelago of the South China Sea. China last week said it was strongly dissatisfied after the US spy plane flew over areas near the reefs, with both sides accusing each other of stoking instability. China should carefully prepare for the possibility of a conflict with the United States, the newspaper said. “If the United States' bottom line is that China has to halt its activities, then a US-China war is inevitable in the South China Sea,” the newspaper said. “The intensity of the conflict will be higher than what people usually think of as 'friction'.” Such commentaries are not official policy statements, but are sometimes read as a reflection of government thinking. The Global Times is among China's most nationalist newspapers. China claims most of the South China Sea, through which US$5 trillion in ship-borne trade passes every year. The Philippines, Vietnam, Malaysia, Taiwan and Brunei also have overlapping claims. The United States has routinely called on all claimants to halt reclamation in the Spratlys, but accuses China of carrying out work on a scale that far outstrips any other country. Washington has also vowed to keep up air and sea patrols in the South China Sea amid concerns among security experts that China might impose air and sea restrictions in the Spratlys once it completes work on its seven artificial islands. China has said it had every right to set up an Air Defence Identification Zone in the South China Sea but that current conditions did not warrant one. The Global Times said “risks are still under control” if Washington takes into account China's peaceful rise. “We do not want a military conflict with the United States, but if it were to come, we have to accept it,” the newspaper said. ^ top ^

Chinese Premier Li Keqiang returns from South America with a caseful of deals (SCMP)
2015-05-27
Premier Li Keqiang was returning home from a Latin American tour on Tuesday with a briefcase full of deals that bolster a relationship profitable for the region's slowing economies but still highly unequal. On Monday, Li and Chilean President Michelle Bachelet signed a currency swap deal seeking to deepen economic ties by boosting trade and investment. The currency swap agreement between Chile's central bank and the People's Bank of China eases the exchange of up to 2.2 trillion pesos (about US$3.6 billion) for the next three years. China has signed currency swap deals with several countries and has worked with financial centres to develop international hubs for offshore trading of the currency. “We want to strengthen our financial cooperation with Chile during this visit, and we have both signed this swap deal,” the premier said during his visit to Chile, the last stop in his four-nation tour of South America, which also included Brazil, Colombia and Peru. “I hope Chinese-Chilean cooperation can allow for services and guarantees that can firmly support our cooperation with all of Latin America.” Li first official trip to Latin America comes as the continent feels the pinch of waning Chinese demand for its commodities. His visit bore the most fruit in Brazil, where he sealed deals for US$53 billion in Chinese investment, mainly focused on upgrading the regional giant's strained infrastructure. He also made stops in Colombia, Peru and Chile on the nine-day tour. The visit followed on President Xi Jinping's visit last July to Brazil, Argentina, Venezuela and Cuba, underlining the Asian power's role as a key trade partner for the region. “Xi Jinping has been very clear about that in the past few months, that China will be contributing much more to the region, billions more to the region in the coming years, despite slowing growth on both sides of the Pacific,” said Margaret Myers, the director of the China and Latin America programme at the Inter-American Dialogue in Washington. China extended more than US$119 billion in loans to Latin American countries and companies from 2005 to 2014, according to a report by the Inter-American Dialogue and Boston University. Oil-rich Venezuela has been the biggest beneficiary, with US$56.3 billion, followed by Brazil with US$22 billion. China, which is on track to displace the United States next year as Latin America's largest trading partner, has devoured the region's raw materials and natural resources, exporting manufactured goods in return. The relationship is “still unbalanced,” said Myers, even if China is slowly starting to import finished goods. “We see a lot of Chilean wine being exported, processed coffee, chocolate, a lot of value-added agriculture,” she said. But that isn't enough to redress the imbalance, said Alicia Barcena, head of the UN's Economic Commission for Latin America and the Caribbean. “Just five products, all commodities, accounted for 75 per cent of the value of regional sales to China in 2013,” she wrote in Spanish newspaper El Pais. Some 90 per cent of Chinese investment in Latin America, meanwhile, went toward extracting natural resources, mainly mines and hydrocarbons, she said. Falling commodities prices in recent years have made the lop-sided relationship more evident, hitting the brakes on Latin America's economic growth. Slowing growth in China now gives the two partners the chance to “deepen and broaden the relationship,” said Joao Augusto de Castro Neves, Latin America chief at consulting firm Eurasia Group. For China, “their priorities are shifting from facilitating import of commodities to facilitating export of their industrial capacities,” he said. “That explains their focus on infrastructure projects in Latin America,” where Chinese construction firms are keen to do more business, Castro Neves explained. The most ambitious deal of Li's tour was for a trans-Amazon railroad linking Peru and Brazil, enabling China to import Brazilian iron and soy for less money by shipping it across the Pacific. “This new Chinese strategy converges with this greater urgency from Latin American countries to seek new investments and new sources of funding,” said Castro Neves. But there will be “hurdles,” he predicted. “The Chinese, we've seen their track record in Africa, for example. They tend to impose some unrealistic conditions when it comes to labour and the environment.” Chinese projects in Argentina, Ecuador, Nicaragua and Peru have already faced protests. In Nicaragua, farmers and environmentalists have been protesting for months against a Chinese firm's ambitious US$50-billion project to build an interoceanic canal to rival Panama's. And in Peru, a worker was killed on Monday in clashes between police and protesting workers angry over “arbitrary” layoffs at a Chinese iron ore mine. “As the Chinese presence continues to become more visible, there's a certain discontent that will be felt more too,” said Carlos Malamud, a Latin America specialist at Spain's Real Instituto Elcano think-tank. A study carried out by universities in Argentina, Peru and the United States concluded that China's increasing presence was “a major driver of environmental degradation in the region, and was also a source of significant social conflict”. “The relationship with China is clearly beneficial for Latin America, but Latin Americans should be more careful at the negotiating table,” including by banding together to leverage their collective weight, Malamud said. ^ top ^

China charts course for blue-water navy, extending reach into open seas (SCMP)
2015-05-27
China has unveiled plans to expand its naval power as part of an assertive military strategy that aims to go beyond its present push for "offshore defence" to "open-seas protection". The defence ministry released a white paper on the plans yesterday, the same day that China broke ground on construction of two lighthouses in the disputed Spratly Islands. Beijing said the lighthouses on Huayang Reef and Chigua Reef - sites of massive reclamation works - were "to improve navigation safety in the South China Sea". The reefs are also known as the Cuarteron Reef and Johnson South Reef. The release of the 9,000-word document comes as Beijing is embroiled in a diplomatic spat with the United States over China's extensive land reclamation in the South China Sea. The tension has been compounded by a series of events, including a CNN report on warnings from China against US reconnaissance flights in the area, as well as US accusations that China tried to electronically jam one of its drones. The events are expected to put China in the hot seat at the Shangri-La Dialogue in Singapore starting on Friday, a regional security summit that Admiral Sun Jianguo, deputy chief of the People's Liberation Army's General Staff, is due to attend. The white paper contains a veiled attack on the United States and its surveillance tactics. "Some external countries are busy meddling in South China Sea affairs; a tiny few maintain constant close-in air and sea surveillance and reconnaissance against China," the document says. Elaborating on the white paper yesterday, defence ministry spokesman Yang Yujun said the Chinese military had been issuing warnings about US renaissance planes for a long time, and he questioned the motives behind the recent reports. Yang also said China had sovereignty over the islands and its building works were equivalent to domestic construction anywhere else in the country. But he said the structures would benefit the international community in terms of navigation and emergency rescue. "Every day all around China, there are all kinds of construction projects being started [such as] homes, roads, bridges and new farmland," Yang said. "From the perspective of sovereignty, China's development of construction on its islands is no different at all from all the other types of construction going on around the country that I just mentioned. "[We] do not rule out the possibility that a certain country is looking for excuses for their further actions [in the region]," Yang said, adding that the PLA's response to the reconnaissance flights was "necessary, lawful, and professional". The white paper said China's previous approach of giving precedence to land forces over naval power would be abandoned, and it would give higher priority to preparation for maritime conflicts. It also said the United States' pivot back to the Asia-Pacific and Japan's attempts to overhaul its post-war military status posed threats to China. Shanghai-based naval expert Ni Lexiong said: "The white paper aims to tell the world China has formally become a great sea power and transitioned from a traditional agricultural country to a modern commercial state, which will focus on maritime development to defend its overseas interests." China's air force and land forces would also be more proactive, according to the paper. The air force will extend the range of its duties from defence to combining "defence and offence", while the army will continue to reorient from defence to "trans-theatre mobility", the document says. The paper also underscores China's determination to continue to develop minimum nuclear power for defence purposes, adding that the Second Artillery Corps, which is in charge of its nuclear missiles, will strengthen its medium and long-range precision strike capacity. The paper also lists four "critical security domains" - sea, space, cyberspace and nuclear forces - and highlights China's need to protect the country's overseas interests. ^ top ^

China, Malaysia pledge to promote bilateral ties (Xinhua)
2015-05-27
Chinese State Councilor Wang Yong has met with Malaysian Deputy Prime Minister Muhyiddin Yassin in Alor Setar, capital of Malaysia's state of Kedah, vowing to promote bilateral ties. During their meeting on Monday, Wang and Muhyiddin spoke highly of the smooth development of China-Malaysia relations, and expressed the belief that the two countries'close cooperation in the preparation and hosting of the exercises would further enhance bilateral ties and China-ASEAN relations. The meeting was held before they attended the opening ceremony of the ASEAN Regional Forum (ARF) Disaster Relief Exercises (DiREx) 2015 co-chaired by China and Malaysia later on Monday. At the opening ceremony, Wang spoke highly of the efforts made by the ARF to promote regional disaster relief cooperation. He briefly introduced the achievements and contributions made by the Chinese government in disaster prevention and mitigation as well as promoting regional disaster relief cooperation. Wang said that non-traditional security issues such as the natural disasters were becoming increasingly salient, which posed severe threats to the stability and development of the Asia- Pacific region. The Chinese government attaches great attention to regional cooperation in disaster prevention and mitigation, and is willing to promote communication and cooperation with all parties in setting up disaster relief mechanism of cooperation which meets the needs of the Asia-Pacific region, he added. Muhyiddin said in his speech that Malaysia appreciates the positive role played by China in promoting regional security cooperation, and thanked the Chinese side for its support to Malaysia in preparing and hosting the disaster relief exercise. He expressed the hope that the exercise would help strengthen the capability building of ASEAN in disaster management and boost cooperation between its members in jointly reacting to natural disasters. Founded in 1994, the ARF is a regional forum for security dialogue in Asia. The forum groups 27 members including 10 ASEAN nations and their dialogue partners. ^ top ^

Senior Chinese official says joint China, Arab efforts on "Belt and Road" initiative beneficial to regional prosperity (Xinhua)
2015-05-27
The joint effort by China and the Arab world to implement the "Belt and Road" initiative will further enhance regional economic cooperation and help promote stability and prosperity in the area, a senior Chinese political adviser said on Tuesday. Wang Zhengwei, vice chairman of the National Committee of Chinese People's Political Consultative Conference (CPPCC), made the remarks while addressing the sixth session of the Conference of Arab-Chinese Businessmen. He said China and the Arab world enjoy long-running friendship, strong political ties and economic complementarity, as well as growing trade connections. The Chinese official called on both sides to build a community of common destiny and shared interests for a better and brighter future. Also in his speech, Wang urged the two sides to step up their strategic energy cooperation, increase two-way trade and mutual investment, boost inter-connectivity of their infrastructure, and promote exchanges between the industrial and business communities of the two. Lebanon's Prime Minister Tammam Salam also attended the opening session. He said his country is "looking forward to playing a key role in the economic course of Silk Road initiative due to its special (geographic) position." The "Belt and Road" initiative was proposed by Chinese President Xi Jinping in 2013, and is aimed at reviving the ancient trade routes that span Asia, Africa and Europe. "The Arab-Chinese Businessmen Forum constitutes the key pillar of cooperation between the Arab world and China. This event also coincides with the 60th anniversary of the first trade agreement between Lebanon and China," Salam said. "China has become the largest trading partner for Lebanon, and we expect this partnership to extend owing to the new horizons of cooperation," he added. Salam also indicated that Lebanon is determined to join the Asian Infrastructure Investment Bank (AIIB). The AIIB is designed to finance infrastructure construction in the continent. It will have authorized capital of 100 billion U.S. dollars and the initial subscribed capital is expected to be around 50 billion dollars. The bank, which will be headquartered in Beijing, is expected to be officially established at the end of 2015. The two-day forum is held to introduce China's "Belt and Road" initiative to local businesses, and to deepen bilateral cooperation in areas such as energy, agricultural, food, machinery, light industry, textiles, infrastructure, finance, and investment. ^ top ^

China dismisses recent tension in South China Sea as 'old tricks' (Globaltimes)
2015-05-26
Defense Ministry spokesperson Yang Yujun on Tuesday labeled recent incidents in the South China Sea as "old tricks" used to stir tensions and smear the reputation of Chinese armed forces. The Navy has had to deal with the reconnaissance operations of US warships and aircraft in Chinese territory around the South China Sea for a long time, said Yang at a press conference today. "Our responses are always necessary, legal and professional," he said. Yang posited that recent developments may have been given a lot of attention because certain country had intensified reconnaissance operations near Chinese waters or certain parties were intentionally drawing attention to the issue. The purpose of this coverage, Yang said, was to discredit the Navy and play up regional tensions. "We cannot rule out the possibility that a certain country is looking for an excuse to support future operations," he said. "This is not something new. It is an old trick." He urged all parties to look at the current situation with clear eyes. Stressing that the China-US relationship generally favorable, Yang said the armed forces of the two countries had a common understanding of relations. As for the disputes between the two sides, China expects the US to respect its core interests and major concerns and hoped that the two sides would work together to improve mutual trust and manage disputes, he said. "It must be noted that China is working toward establishing positive interactions with the US in the Asia-Pacific region and hopes that other countries in the region will jointly safeguard peace, security and stability," he said. ^ top ^

Nansha Islands construction 'befits China's international responsibilities' (China Daily)
2015-05-27
Construction work by China on some garrisoned islands and reefs on its Nansha Islands was defended by a senior Chinese diplomat on Tuesday. Such work is proceeding "at a pace and on a scale befitting its (China's) international responsibilities and obligations", the diplomat said. Ouyang Yujing, director-general of the Chinese Foreign Ministry's Department of Boundary and Ocean Affairs, was responding to accusations that China's construction activities on some islands and reefs are outpacing and "outsizing" those by other countries in the South China Sea. "China is a big country that shoulders more international responsibilities and obligations," he said. These responsibilities include "search and rescue, disaster prevention and mitigation, meteorological observation, ecological conservation, navigation safety and fishery services", he said. The work is designed to "provide better services for the ships of China, its neighbors and other countries whose ships and boats pass through the South China Sea", he said. US officials, including Assistant Secretary of State for East Asian and Pacific Affairs Daniel Russel, have claimed recently that equitable resolution of disputes and freedom of navigation are being "challenged" by Chinese activities in the South China Sea. Ouyang said freedom of navigation and overflights in the region have never been affected by such disputes. Construction and maintenance of facilities on China's garrisoned islands and reefs "will not undermine countries' freedom of navigation", he said. "On the contrary, it will facilitate joint response to challenges on the sea and provide for increased safety of navigation," he said. China has accused the Philippines and some other countries of illegally occupying some islands and reefs in the Nansha Islands. Ouyang stressed that China's construction activities and those of other countries are "totally different in nature", and again urged the other nations to immediately withdraw their personnel and facilities from the islands and reefs they have occupied illegally. Speculation has arisen over whether China will establish an Air Defense Identification Zone in the South China Sea once the construction is completed. Ouyang said China has the right to establish an ADIZ, and this has nothing to do with territorial or maritime disputes. He also dismissed speculation that Chinese construction on the islands and reefs is aimed at bolstering the legal status of the Nansha Islands. China's sovereignty and relevant claims to rights in the South China Sea have been formed in "the long course of history" and upheld by successive Chinese governments, he said. "This position has adequate historical and legal basis. There is no need to have it strengthened through construction activities on the islands and reefs." ^ top ^

China, US 'unlikely to resolve disputes over South China Sea in the short term' (SCMP)
2015-05-28
China and the United States are locked in a stalemate over Beijing's extensive land reclamation in the South China Sea, with experts pessimistic that the two powers can resolve their differences over the disputed waters in the near future. The best the two countries could do was to strengthen communication between their militaries, the analysts say, with the tensions over the contested waters likely to overshadow upcoming bilateral dialogues. Tensions have flared again in recent days, following a CNN report last week on China's warnings against a US spy plane's flight over the South China Sea, as well as Beijing's release on Tuesday of a white paper that unveiled plans to expand its naval power and counter Washington's surveillance. The Communist Party's flagship newspaper People's Daily warned in a commentary on Wednesday that the US would face “more than a war of words” if it continued to “peep from others' window with a long lens”. “Neither side will make substantial compromises over these security issues,” Renmin University's Sino-US expert Shi Yinhong said. “The countries are stuck in a stalemate.” Both sides would not budge on their core interests in the region – China's territorial claims and the US' freedom of navigation, Shi said. China, Brunei, Malaysia, Taiwan, Vietnam and the Philippines lay claim to all or parts of the resource-rich South China Sea, which spans 3.5 million square kilometres. China has in recent months made other claimants and the US bristle by landfilling tiny islets to solidify its claims in the region. The US wants the sea to stay open to shipping and flights, but Beijing has said Washington wants to keep a presence there to contain Chinese maritime expansion. “There is a clear discord and a consensus would be too much to ask for,” Peking University's Professor Jie Dalei said. Both sides had a different understanding on international laws, in particular, whether a country should enjoy the same territorial rights on artificial islands as on natural ones, Jie said. Dr Li Mingjiang, coordinator of the China Programme at the Nanyang Technological University's S. Rajaratnam School of International Studies in Singapore, said that while the two powers were still far away from resolving their differences, it was unlikely the tensions would trigger a military stand-off. Both sides simply needed to voice their discontent aloud, but neither wanted to see the tensions escalate, Li said. “The US will probably send warships or surveillance vessels to the disputed waters as a gesture of their opposition against China's land reclamation works,” he said. “Even so, they won't stay long or close enough to trigger a naval stand-off.” The analysts say that at the moment, China and the US can only focus on improving communication between their militaries. This was one of the major achievements from the last meeting between President Xi Jinping and his US counterpart Barack Obama in November. They agreed that both militaries would inform each other before any major operation, and oversaw the setting up of rules of behaviour for accidental encounters at sea to avoid clashes. Shi said Xi and Obama's agreements came after Chinese and American military aircraft and vessels came dangerously close to open conflict near China late last year. “The priority now is to study how to improve the existing mechanisms to avoid accidental military clashes amid the ongoing disputes,” Shi said. Both powers were now considering how to expand their rules of behaviour to cover accidental encounters in the air, Li said. “The previous agreements were not detailed enough, and both Beijing and Washington intend to make them better,” Li said. “In general, the two militaries have enjoyed close ties these years and their dialogues will not be hindered by the current tensions over the South China Sea.” Jie said the next round of the China-US Strategic and Economic Dialogue might touch on the prevention of military clashes between the two powers. The White House has said the dialogue will be held late next month and attended by State Councillor Yang Jiechi and US Secretary of State John Kerry. “That's why delegates from both militaries were invited to the dialogue,” Jie said. “But it's hard to tell whether and to what extent they will be able to see any development [on the communication mechanism].” The South China Sea disputes were also likely to remain on the agenda of Xi's state visit to the US in September, said Peking University's Professor Niu Jun. But both sides were more likely to focus on finalising investment deals, particularly the China-US bilateral investment treaty, he said. Last month, the state-run Xinhua news agency quoted deputy finance minister Zhu Guangyao as saying the two countries would exchange lists of the treaty “this month or the next”, which could pave the way for “substantial achievement on negotiations in September”. ^ top ^

China denies enhancing maritime strength by construction on Nansha Islands (Xinhua)
2015-05-27
China on Wednesday reiterated its construction activities on the Nansha islands and reefs are lawful, reasonable and justified, refuting accusations of enhancing its maritime strength by doing so. "China's construction on the Nansha islands and reefs are within China's sovereignty. Even some senior U.S. officials said China's activities did not violate international law," said Foreign Ministry spokesperson Hua Chunying at a press briefing. She blamed some countries' attempts to play up tensions in the region and hurt China's image, in order to cover up their illegal occupation of China's territory. "Their illegal occupation is the root cause of the dispute in the South China Sea," Hua added. Responding to a question that the United States will continue surveillance activities around the islands and reefs in the South China Sea to protect navigation freedom, Hua said the freedom of navigation "should not be taken as excuses by some countries for disregarding or hurting others' sovereignty, rights, navigation and aviation security." She reiterated reconnaissance conducted by U.S. military aircraft is highly likely to cause untoward incidents in the waters and airspace, and is utterly dangerous and irresponsible. Hua urged the U.S. to stop all irresponsible and proactive words and deeds to contribute to peace and stability in the sea. She said the freedom of navigation and over-flight in no way means that foreign military vessels or aircraft can violate the international law and disregard the legitimate rights and the safety of over-flight and navigation of other countries. In terms of navigation freedom, the United Nations Convention on the Law of the Sea clearly states that peace, order and security of the coastal countries should not be undermined, Hua said. ^ top ^

Is China undermining freedom of navigation in South China Sea? (Xinhua)
2015-05-27
It seems absurd two lighthouses in the South China Sea could evoke worry about the situation in the waters. But that is how it happened, days after the United States made close reconnaissance in the region. Many believe the projects, together with other infrastructure construction, show China's muscle and will undermine the freedom of navigation in the waters of the region. But such rhetoric could be proved groundless by the truth and the real situation of the region. China's Ministry of Transport on Tuesday began construction of two lighthouses on Huayang and Chigua reefs in the Nansha Islands. The two 50-meter lighthouses are designed to have a light range of 22 nautical miles. Can the lighthouses attack passing vessels? Or can the lighthouses only serve passing Chinese ships but not foreign ones? The answer goes without saying. As sea and weather conditions in South China Sea are quite complicated, lighthouses and other projects can facilitate the people in many aspects, including maritime search and rescue, disaster relief, scientific research, navigation security, meteorological observation and other services. Safety is the most important issue for navigation. With those facilities, passing ships can be safer, and if they encounter dangers, they will be saved in much shorter time, no matter which countries they are from. It will also be China's contributions to the international community in peaceful use of the waters. Islands and reefs in the South China Sea are China's indispensable territory. Building facilities there is no different than construction projects in the mainland, because they are all within the sovereignty of the country. China is also building military facilities on some islets and reefs. However, as defense ministry spokesperson Yang Yujun said Tuesday, all the military facilities are defensive in nature, targeting no other parties. If those military facilities make someone worry, the only reason is that they are over-sensitive. In a bid to provide services to passing ships, scientific studies and other activities, those facilities in almost unpopulated areas must have defensive capacities. Will they make navigation unfree? Before answering this question, one should understand what is freedom of navigation. Is it the close reconnaissance flight conducted by U.S. military aircraft? China always supports freedom of navigation in South China Sea, in accordance with international law and practices. The passage of foreign military aircraft and vessels are never welcome in any country's territorial waters. The newly-issued China's national defense white paper warned of threats to China's maritime rights and interests, citing the provocative actions of some offshore neighbors, including reinforced, and illegal military presence in Chinese territory, and outside parties involving themselves in South China Sea affairs. Lighthouses and defensive military facilities can only facilitate freedom of navigation. Isn't it making a fuss to doubt the issue? ^ top ^

Chinese state councilor stresses people-to-people exchanges with Japan (Xinhua)
2015-05-27
Chinese State Councilor Yang Jiechi said here Wednesday that China places great importance on people-to-people exchanges and cooperation with Japan. Yang met with Vice President Ikeda Hiromasa of Japan's major lay Buddhist organization Soka Gakkai in Zhongnanhai, the headquarters of the Chinese government. Chinese President Xi Jinping pointed out in a recent meeting with Japanese guests in Beijing that China-Japan friendship has taken root in the common people and that the future of bilateral relations rests in the hands of the people of both countries. Yang said the Chinese side is ready to work with the Japanese side in the spirit of "taking history as a mirror and looking forward to the future," and to continuously improve and advance bilateral relations on the basis of the four political document signed by both countries. Yang spoke positively about the active effort that the Japanese organization has made to develop China-Japan friendship in the long run. Ikeda Hiromasa said Xi's speech has received positive response inside Japan. He said the China-friendly groups in Japan were encouraged by Xi's speech. He said the Soka Gakkai is ready to carry on its tradition of advancing Japan-China friendship and to make greater contribution to promoting people-to-people exchanges and bilateral relations. ^ top ^

Chinese, Indonesian presidents greet bilateral meeting of people-to-people exchange mechanism (Xinhua)
2015-05-27
Chinese President Xi Jinping and his Indonesian counterpart Joko Widodo extended congratulatory messages respectively to the first meeting of a bilateral High Level People-to-People Exchange Mechanism (PEM) held here on Wednesday. In his message, Xi said that China and Indonesia have enhanced their political mutual trust and pragmatic cooperation, which have benefited both peoples, since the two countries forged a comprehensive strategic partnership in October 2013. "I believe that the China-Indonesia people-to-people exchange mechanism at vice premier's level will help promote exchanges and cooperation between the two countries in the field of cultural and people-to-people exchange," Xi said. There is a great potential for China-Indonesia mutually beneficial cooperation as the two countries' economies are highly complementary and the China-proposed 21st Century Maritime Silk Road and Indonesia's Global Maritime Fulcrum fit well with each other, he added. The Chinese president hoped both sides could join hands to further advance their comprehensive strategic partnership. Indonesian President Widodo said he and President Xi endorsed the establishment of the PEM during his visit to China in March, complementing political-security and economic dialogues already established, and providing public support and social network for vigorous bilateral relations. "I strongly believe that this first meeting of Indonesia-China High Level PEM will further promote people-to-people ties whilst injecting new energy into a dynamic development of Indonesia-China relations," he said. "I look forward to seeing positive results from the new mechanism and hope for stronger ties between our two nations." Chinese Vice Premier Liu Yandong and Indonesian Coordinating Minister for Human Development and Culture Puan Maharani co-hosted the meeting. ^ top ^

Chinese vice premier urges Asia-Europe "connectivity" (Xinhua)
2015-05-27
Chinese Vice Premier Zhang Gaoli called on Asia and Europe to strengthen their communication, trade and financial links as he opened a Eurasian political and business forum in southwest China's Chongqing City on Wednesday. Addressing the opening ceremony of the two-day Asia-Europe Meeting (ASEM) Industry Dialogue on Connectivity, Zhang said such strong relationships were "a trend of the times and a global concern". A popular term among Asian leaders, "connectivity" has been defined by Chinese President Xi Jinping as concerning not only physical infrastructure like roads, but also people-to-people exchanges, policy coordination, trade and capital flow. On policy coordination, Zhang said Asian and European countries should achieve consensus before integrating their development strategies. He highlighted transportation, communication and energy as important areas for connectivity. The vice premier said the countries should "consolidate the social foundation for connectivity" by ensuring openness in their education, employment and tourism markets. The China-proposed "Belt and Road Initiative" on trade and infrastructure networks have been welcomed across Asia and Europe, according to Zhang. Its success is in the interests of all the sides involved, he said. With funding from the Asian Infrastructure Investment Bank and the Silk Road Fund, the initiative will provide a significant boost to Asia-Europe industrial cooperation, Zhang stressed. The ASEM Industry Dialogue on Connectivity has gathered government officials and company representatives from the 53 members and international organizations grouped under the ASEM. ^ top ^

China justifies defensive military strategy (Global Times)
2015-05-27
A Foreign Ministry spokesperson on Wednesday justified China's concern over Japanese military buildup, after Japan's chief cabinet secretary questioned the rationale of China's defensive military strategy. Following the Tuesday release of China's first white paper on military strategy, Japanese broadcaster NHK reported that Chief Cabinet Secretary Yoshihide Suga had dismissed concern expressed in the paper about Japan's efforts to enact new security legislation. Foreign Ministry spokeswoman Hua Chunying said China had suffered long-term aggression by imperialist powers. "History dictates that we must build a national defense force to match up to our economic development and the need of safeguarding national security," Hua said. ^ top ^

Spy charges stem from US anxiety over China (Global Times)
2015-05-27
Last week, a Chinese professor from Tianjin University, Zhang Hao, was accused and arrested by the US for economic espionage. The university soon refuted the charges. Meanwhile, a Chinese-American scholar from Temple University, world-renowned in the field of superconductivity, Xi Xiaoxing, was arrested and charged with stealing secret US defense technology. There was the case of Sherry Chen, a Chinese-American hydrologist at the National Weather Service in Ohio, who was falsely arrested last October and accused of spying. Her case has been placed under the spotlight of public attention, for the lawsuit ended up costing her everything despite the charges being dropped in March. Similar incidents in such a short time are making people think about what the Sino-US relationship has gone wrong. As a country of immigrants, today's mighty US is created by different ethnic groups coming together, in which the Chinese are an organic component and have been making outstanding contributions to the nation's development. However, given the delicate ties between Beijing and Washington at present, and the White House's possible adjustment of its policies toward China, some ethnic Chinese, especially those involved in scientific work that relates to US economic and strategic interests, are likely to fall victim to the change of US policies. There is no better word than "anxiety" to describe the feeling of the US toward China. Faced with Beijing's rapid growth of development as well as international influence, Washington is becoming increasingly anxious. The White House used to believe that China could be integrated into the US-dominated international order and become a partner of the US after its reform and opening-up. Yet it is increasingly aware of the reality that China has been getting stronger. Following US assumptions, China has been rising with its own characteristics. Over the past few years, the gap of national strength between the two countries has been narrowing. The US has also felt the momentum of Chinese diplomacy and mega-projects such as the "One Belt, One Road" initiative and the Asian Infrastructure Investment Bank, of which Washington is not a participant yet. Beijing has no objection to the US joining the two, but the US does not want to join. The White House is not a fan of China's goal, which is realizing its dream of national rejuvenation and merging into the current international system through internal reforms. These two targets do not clash with one the other. Nevertheless, the US doesn't think the same way. In the end, Washington began tilting toward hard-line approaches toward China. The recent spying charges remind us of the case of Wen Ho Lee, a Taiwan-born scientist at a US nuclear laboratory, who was held in the US in 1999 for nine months for espionage involving missing nuclear research files. Li's case was once a significant part of US media and political hype of the "China threat" theory. However, he was later cleared of all but one of 59 charges. The truth is, the remaining one charge was Lee's compromise with the US government, because only in this way, could the US government find a way out, while Lee would no longer suffer behind bars. But in any case, the charge delivered a message that the US sometimes arrests people without solid proof. As for the most recent charges, Zhang's case might be at most a dispute over intellectual property, while Xi's behavior might be no more than common academic exchanges. Investigation and evidence is needed to show whether they are spies or not. Therefore, the best way to reveal the US' intention is to show the truth. Furthermore, ethnic Chinese in the US should raise their awareness and speak up for their own rights. If we turn our watches back to the end of the 1940s when the US started to shift its policy toward the then Soviet Union, from being allies to rivals, it also began with arresting suspected spies and playing up possible dangers. Hence, the recent incidents also make people worried over the US' future policy on China. We hope that Beijing-Washington ties can be stable, and our major-power relationship can be more than just a slogan, but something that bears actual fruit. Since a big gap exists between China's intention and the US version of understanding toward it, both sides need to put more efforts and endeavors toward reducing miscalculation and boosting mutual trust. ^ top ^

Beijing blames US for 'double standards' in S. China Sea (Global Times)
2015-05-29
The exchange of words between China and the US over the South China Sea issue has intensified in the past few days, as a Chinese Foreign Ministry spokesperson on Thursday called for the US to stop meddling in the South China Sea with "double standards" and restated China's sovereignty and legitimacy in building facilities in the region. China's facilities construction in the South China Sea is within China's sovereign rights, and "the pace and scale of this construction fits with China's international responsibilities and obligations as a big country," said Hua Chunying, adding that no one has the right to dictate China's moves in the region. The "selective silence" of the US toward other countries' illegal occupation and construction on China-owned islands has reflected its "double standards" and political intentions, Hua said at a routine press meeting of the Ministry of Foreign Affairs in Beijing. Hua's response came a day after US Defense Secretary Ash Carter said there should be an immediate end to the construction by China and other countries near the South China Sea, urging participants to stop militarizing the dispute and find a peaceful solution. Carter said China's island-building efforts were "out of step" with the regional consensus and that US military aircraft and warships would continue to operate in the area as permitted under international law. "They're increasing demand for American engagement in the Asia-Pacific. We're going to meet it," the US defense chief said in a military ceremony in Hawaii on Wednesday. Hua referred to the constant US challenging of China's sovereignty in the region as instigations that threaten the stability of a region that is now serving as the world's engine of economic growth, and urged the country to be responsible and constructive in its actions and remarks. The increasingly sharp remarks by the US are aimed to "internationalize" the South China Sea issue by lining up with countries such as the Philippines, Vietnam, and Japan, said Wang Xiaopeng, a maritime border expert at the Chinese Academy of Social Sciences. Wang described the US as an "illegal agitator" as it is neither located in the South China Sea nor does it have any sovereignty disputes with China in the region. "The US, which lacks the strength to meddle in the South China Sea alone, is encouraging countries like Japan, which has disputes with China over the East China Sea, to interfere in conflicts in the South China Sea," Wang said. Hua said earlier in a press conference that the facilities in the region served to facilitate maritime search and rescue, disaster prevention and mitigation, marine science and research, meteorological observation, environmental protection, navigation safety, and fishery production service. These facilities will also serve and assist transiting ships from other countries, Hua noted. The Ministry of Transport on Tuesday held a ceremony for two 50-meter-tall lighthouses on two islets in the South China Sea. The lighthouses will help with international aviation at this area, authorities said. The Chinese foreign ministry has recently criticized US surveillance activities over the South China Sea after a US P-8A anti-submarine and maritime surveillance aircraft flew over waters off China's Nansha Islands. The aircraft was asked by Chinese troops to change course over radio. These surveillance activities will pose a threat to the security of China's maritime features and may cause miscalculations that will lead to maritime and aerial incidents, Foreign Ministry spokesperson Hong Lei said Wednesday. Wu Xinbo, director of the Center for American Studies at Fudan University, told the Global Times that the US has assumed a new role in the South China Sea, from previously supporting South Asian countries with their illegal sovereignty claims to becoming more vocal and confrontational in its stance. Wu believes the possibility of military confrontation remains highly unlikely, if US navy ships stay more than 12 miles off the islands. Wu expected that the South China Sea issue may be brought up during the China-US Strategic and Economic Dialogue to be held in June. ^ top ^

Xi congratulates Nepalese president on Republic Day (Xinhua)
2015-05-29
Chinese President Xi Jinping on Thursday sent a congratulatory message to his Nepalese counterpart Ram Baran Yadav on Nepal's Republic Day. In his message to mark the eighth Republic Day of Nepal, Xi spoke highly of the bilateral ties. China and Nepal, linked by rivers and mountains, are as close as brothers, Xi said. The devastating earthquake that struck Nepal has caused tremendous damage and suffering to the Nepalese people, which the Chinese government and people feel as if they had also experienced in person, the Chinese president said. On April 25, a 7.9-magnitude earthquake hit Nepal. Nearly 9,000 people have lost their lives, with tens of thousands of houses destroyed or damaged in the disaster and ensuing aftershocks. Pledging China's full support to aid Nepal's disaster relief efforts and help the Nepalese people rebuild their homes, Xi said the destinies of the two countries will become more closely entwined and the friendship between the two peoples will grow stronger in the process. Xi stressed that China attaches great importance to developing friendly relations with Nepal and appreciates Nepal's long-standing one-China policy. The Chinese side is ready to work with the Nepalese side to continuously promote the development of the China-Nepal comprehensive partnership and ever-lasting friendship, Xi said. ^ top ^

China reaffirms its construction in South China Sea is "lawful, reasonable, justified" (Xinhua)
2015-05-29
A Foreign Ministry spokesperson on Thursday reaffirmed that China's construction in the South China Sea is within China's sovereign rights and its activities are lawful, reasonable and justified. Spokesperson Hua Chunying made the remarks after U.S. Defense Secretary Ash Carter on Wednesday called for an immediate end to island-building by China and other countries near the South China Sea, urging participants to stop militarizing the dispute and find a peaceful solution. Carter said China's island-building efforts were "out of step" with the regional consensus. "We will remain the principal security power in the Asia-Pacific for decades to come," said Carter. Hua said some countries have carried out illegal construction activities within China's territory in the South China Sea, but the United States has selectively failed to speak about it. China's construction in the South China Sea is within China's sovereign rights, said Hua, but the United States makes irresponsible remarks on the issue. Hua reiterated that China is a big country that shoulders more international responsibilities and obligations, and its construction activities are being conducted at a pace and scale befitting those responsibilities and obligations. "We have our own judgment and nobody has the right to tell China what to do," Hua said. At present, the overall situation in the South China Sea is stable, but several countries have been stirring up trouble and provoking China over its territorial sovereignty and maritime rights and interests, Hua said. She said the United States should think seriously about what kind of Asia-Pacific region it wishes to see and the kind of role it should play in the region. Hua also asked whether it is in line with U.S. interests for the Asia-Pacific region, as an important economic growth engine, to be disturbed. She urged the United States to have a responsible attitude and play a constructive role in regional peace and stability. ^ top ^

Top Chinese political advisor meets Archbishop of Canterbury (Xinhua)
2015-05-29
Top Chinese political advisor Yu Zhengsheng met with Archbishop of Canterbury Justin Welby in Beijing on Thursday. Yu, chairman of the National Committee of the Chinese People's Political Consultative Conference, reviewed strengthening ties between China and Britain. He highlighted close high-level exchanges, stronger collaboration in various fields and deeper understanding between the two peoples, saying stronger ties are in the fundamental interests of the two countries and contribute to world peace, stability and prosperity. Chinese citizens' freedom of belief and the religious circle's legitimate rights and interests are protected by law, Yu told the British religious leader. He hailed the good relations between Chinese and British Christianity, pledging that China will continue to support exchanges and cooperation between Chinese Christianity and other churches worldwide. Welby, who is the fourth Archbishop of Canterbury to visit China, called for stronger cooperation between Chinese and British churches. Welby, 59, is the 105th Archbishop of Canterbury, the senior bishop and principal leader of the Church of England. He is visiting Beijing at the invitation of the State Administration for Religious Affairs and Christian associations in China. ^ top ^

China's most-wanted fugitive set to be extradited by US (China Daily)
2015-05-29
China's most-wanted fugitive, an official accused of embezzling more than $40 million, is in US custody and waiting for extradition, Lou Martinez, the spokesman at New York office of the US Immigration and Customs Enforcement agency, told chinanews.com on Thursday. Yang Xiuzhu, who fled China in 2003, was detained after entering the US using a fake Dutch passport last year, according to the Party's Central Commission for Discipline Inspection (CCDI). In the first confirmation of Yang's whereabouts in a decade, the commission's International Cooperation Department said she escaped from detention in the Netherlands in May 2014 – after being rejected for political asylum and before she could be sent back to China. Yang, the former deputy Mayor of Wenzhou, East China's Zhejiang province, oversaw construction projects in the booming city in the 1990s. During that time, she made a fortune large enough to purchase in 1996 a five-story building worth $5 million in midtown Manhattan. Given the moniker of "Corrupt Queen" by media, she escaped to America when her brother was under probe for corruption in 2003, and was eventually detained in the Netherlands in 2005 after Interpol issued a Red Corner Notice, an international arrest warrant requested by China, against her. She is in custody at the Hudson County correctional facility in New Jersey, according to a database maintained by the US Immigration and Customs Enforcement agency. "The momentum of cooperation with the US is very good," Fu Kui, director of international cooperation at the CCDI, said in an interview in Beijing on Wednesday, in which he discussed China's campaigns to track and return suspects. "There has been some progress and examples of success and there is room for greater cooperation." Repatriating former officials who have absconded is a key cog of President Xi Jinping's fight against corruption, which he has called a "life and death" matter for the Party and the country. A former deputy mayor of the coastal city of Wenzhou, Yang, 68, was ranked number one on a list of 100 people China says are hiding abroad to avoid prosecution for graft. Catching these fugitives "is a key aspect of the anti-corruption campaign," Fu said. "If we leave an escape here, we won't be able to deter officials who think they can get away with corruption." Earlier in May 9, Li Huabo, the second most important suspect from China's "100 most wanted economic fugitives" list issued by Interpol's National Central Bureau of China in April, was repatriated from Singapore after five years on the run. The CCDI said the publication of the list and the issuance of the notices is part of Operation Sky Net, which started in early April and targets corrupt officials at large in foreign countries with the aim of confiscating misappropriated money and assets. ^ top ^

Xi to make state visit to Britain in the autumn (China Daily)
2015-05-29
President Xi Jinping is to pay a state visit to Britain in October, the first by a Chinese president in a decade, and stay at Buckingham Palace. The visit is being viewed as a growing sign of improved relations between the two countries. Xi could be the first head of state to personally congratulate the queen on becoming the longest serving monarch in British history. On Sept 9, she will surpass the reign of her great, great-grandmother Queen Victoria, who was on the throne for 67 years and 216 days. The visit by Xi and his wife Peng Liyuan was announced by the queen in her speech on Wednesday outlining the government's legislative program. Delivering the speech to Parliament, the 89-year-old monarch said she and her husband, Prince Phillip, "look forward to welcoming His Excellency the President of the People's Republic of China and Madame Peng on a state visit in October". The queen's press secretary said in a statement later that Xi and his wife had accepted the invitation and will stay at Buckingham Palace. Former president Hu Jintao and his wife stayed at the palace in 2005. No information on the length of Xi's visit has been announced. Prince William, the queen's grandson and second-in-line to the throne, met Xi in March in the highest-profile visit to China by a member of the British royal family since the queen and her husband paid a state visit to the country in 1986. On Wednesday, the queen also said her government looked forward to an enhanced partnership with China and India. Wu Kegang, chief executive officer at trade promotion organization BCC Link to China, said: "It was obviously a very positive speech." It was the first time that China had been mentioned in a Queen's Speech, Wu told Xinhua. Wu said Xi's visit will create even stronger and more stable links with Britain, adding, "It is also setting the right tone at the right moment for both countries." A spokesperson of The Confederation of British Industry said: "The United Kingdom's trading partnership with China is of critical importance to our economic future... President Xi's visit is a timely sign of the ever-deepening importance of that relationship, and will help further strengthen the trading bonds that link our two countries." ^ top ^

 

Domestic Policy

China solicits private investors for PPP projects (Xinhua)
2015-05-29
China top economic planner has announced the details of 1,043 proposed projects in which private investors are invited to participate through public-private partnerships (PPP). Focusing on infrastructure and public services such as water conservation, transport and environmental protection, the investment needed for these projects totals 1.97 trillion yuan (322 billion U.S. dollars), according to statements posted on the National Development and Reform Commission (NDRC) website on Monday. PPP refers to long-term cooperation between governments and private companies on projects that are mainly funded and operated by the latter and supervised by the former. China is increasingly turning to PPPs to bridge a huge financing shortfall in infrastructure, which is considered a spearhead in the government's bid to temper the economic slowdown caused largely by the ongoing property downturn. The NDRC did not specify whether the PPPs will be open to foreign investors. It has designated 12 of the 1,043 projects as pilot schemes, to perfect policies over the next two years' to March, 2017. PPPs have existed in China since the 1980s, but the uptake of the financing mode has been slow. Confronted with mounting local government debt and a pressing need to fund urbanization and cope with a rapidly aging population, China released two PPP guidelines last year. Earlier this month, the cabinet said the government will streamline approval procedures for PPPs and that PPPs in public services will enjoy tax breaks and other financial rewards. PPP project operators are encouraged to directly solicit money from the capital market, and social security funds and insurance premiums are allowed to invest in these projects, according to the cabinet. ^ top ^

China to launch first stock index options soon: report (China Daily)
2015-05-29
The China Financial Futures Exchange (CFFEX) will soon launch the country's first-ever stock index options, the Shanghai Securities News reported on Monday, giving investors more hedging tools as the government steps up financial market reforms. The first batch of stock index options would be based on China's blue-chip CSI300 index and SSE50 index as well as the small-cap CSI500, the reports quoted CFFEX Chairman, Zhang Shenfeng, as telling a financial forum over the weekend. Stock index options will be the third product to be launched by the CFFEX, set up in 2006 to help develop China's financial derivatives markets. The exchange now trades stock index futures and government bond futures. "Innovation in China's derivatives market is still at an early stage," Zhang was quoted as saying by the official Shanghai Securities News. "However, the markets have huge potential and promising prospects."The Securities Times, another official paper, said the new options will help investors manage volatile equity market risk but will not divert much investment from existing products as the scale of trade in new products is usually controlled in the initial stages. Buyers of options contracts have the right, but not the obligation, to buy or sell an underlying asset at an agreed upon price during a certain period of time. They allow investors to hedge their investments but may also expose speculators to heavy losses. China's financial reforms, including the launch of a slew of new financial products, are gathering pace one-and-a-half years after Beijing pledged to let markets play a "decisive role" in the world's second-largest economy. The need to generate growth in a slowing economy is partly behind the reforms, but so is the desire to integrate Chinese markets with their global counterparts in order to raise China's international status. This year alone, regulators have approved many new exchange traded derivatives, such as individual stock options listed on the Shanghai Stock Exchange, and allowed firms to issue asset-backed securities by simply registering with regulators. ^ top ^

Shanghai OKs draft plan to be an innovation hub (China Daily)
2015-05-29
Framework to be in place by 2020 to enhance international finance, shipping and trade Shanghai approved a draft plan on Monday for building the city into a technological innovation center. According to the proposal, by 2020 the city will complete the framework for such a center with global influence. By 2030, the core functions of a global innovation center will be in place. Construction of such a center will enhance the city, which is already on the road to establishing an international economic center, a financial center, a trade center and a shipping center, China Securities Journal reported. In March, Deputy Mayor Zhou Bo disclosed that the priority of the city's work agenda for this year was "to greatly implement the strategy of innovation-driven development" and "to speed up establishing the technology innovation center", news website thepaper.cn reported. To achieve this goal, Zhou said the government will pilot a new immigration policy, special taxation for angel investors, the identification of more high-tech enterprises and the establishment of a strategic emerging industries board. "This initiative is in line with Shanghai's goal of becoming an international financial, shipping and trade center by 2020," said Yan Yanming, a researcher with the Shanghai Academy of Social Sciences. Innovation could happen at different levels, from small community platforms to specialized incubators, and from State-owned companies and multinational corporations to the city government itself. "Innovation could be supported by favorable policies, subsidies or startup funds," said Yan. In the next five years, the Shanghai Pudong Software Park will provide a minimum of 300 million yuan ($48.4 million) to support business startups. "Such a goal is in line with the city's ambition of building a global technological innovation center," said Zhang Sulong, general manager of Shanghai Pudong Software Park Co Ltd. The new goal is expected to provide technology-driven companies such as Honeywell with a huge, strategic opportunity to drive smarter and more sustainable growth through innovation. "As the country's financial center and economic powerhouse, Shanghai can play a key role in driving the country's transformation and sustainable development," said Shane Tedjarati, president of Honeywell's global high-growth regions. "Innovation is the most important driving force for this development. Honeywell will be highly committed to joining hands with local authorities and businesses in developing Shanghai as an international technological innovation center." Once the multinationals and universities and other institutions connect and find cooperative solutions, we will see a lot of the creative ideas turning into practical products, said Yan. "But it is also worth noting that, compared with its international counterparts, Shanghai is still lagging behind in state-of-the-art technologies, and such a gap could only be filled by policy, investment and talent," Yan said. Last year, 83.1 billion yuan was poured into R&D in Shanghai - 3.6 percent of the city's GDP. ^ top ^

Profits at China's state firms continue declines (China Daily)
2015-05-29
Profits at China's state-owned enterprises (SOEs) continued to slide in the first four months of the year, but at a slower pace as the government's measures to counter the slowing economy begin to take effect, official data showed on Monday. Combined profits for SOEs dropped 5.7 percent to 704.1 billion yuan (about 115 billion U.S. dollars) during the January-April period, the Ministry of Finance said in a statement. The decline decelerated from the 8-percent fall registered in the first three months and 21.5-percent plunge in the first two months. The ministry said profits at the SOEs, excluding the three oil giants -- CNPC, Sinopec and CNOOC, and those in coal mining, steel and non-ferrous metal sectors that were struggling with excess capacity, climbed 11.6 percent year on year during the period. It said SOEs' business revenue was down 6 percent year on year while their operating costs fell 5.5 percent during the period. The transport, electronics and power generation sectors saw strong increases in profits while the petrochemical, oil, construction materials and machinery industries posted notable profit drops. Coal mining, steel and non-ferrous metal industries reported losses, according to the statement. To stabilize the economic growth, which slowed to a six-year low of 7 percent in the first quarter, China's central bank has cut the benchmark interest rates three times since November. It also lowered the reserve requirement ratio for commercial banks twice, in February and April. However, according to the latest HSBC flash manufacturing purchasing managers' index, China's manufacturing activity continued to contract in May, pointing to persistent weakness in the economy that analysts say may prompt more stimulus measures. ^ top ^

Twelve staff of Chinese nursing home in custody following blaze that killed 38 residents (SCMP)
2015-05-27
At least 12 people connected to the privately run home for the elderly in central China where 38 people died in a fire earlier this week have been taken into custody, state media reported on Wednesday. Xinhua reported that the 12 included the legal representative of the Kangleyuan Rest Home, and that police were searching for another three employees. The fire broke out on Monday night in the home, which housed 51 residents in Pingdingshan, Henan province, the province's work safety administration said in a statement. In addition to the dozens who died, six people were injured, with two listed in serious condition, the statement said. A photo of the fire scene released by Xinhua showed that many sections of the home appeared to have completely burned. The official state-run news agency said the cause of the fire was unclear. “I was in my bed at the time. Suddenly, I saw a worker run out of a room that was on fire and he shouted 'Run! Run!' so I dashed out,” Guo Xin, 78, was quoted by Xinhua as saying. Another survivor, Zhao Yulan, 82, said only two of the 11 residents in her ward survived, Xinhua reported. Some of the victims could not be identified, the news agency said. The fire destroyed a part of the home housing people who were completely dependent on others for care. Xinhua quoted 80-year-old resident Chen Runsheng as saying not enough caregivers were working at the home. Premier Li Keqiang called on officials across the country to “draw lessons from the accident, and check all potential safety hazards to avoid similar incidents,” Xinhua said. Fire officials were ordering inspections of nursing homes, kindergartens, child-care centres, hospitals and what Xinhua called “welfare houses” across the country. With a rapidly ageing population and under-resourced social security net, China faces increasing pressure to provide safe and affordable care for the elderly. Xinhua cited figures showing a severe shortage of caregivers in the country, with 220,000 working in homes for the elderly, while 10 million are needed. The tragedy “was a sore reminder” that facilities for the elderly were still substandard, Xinhua said in a commentary on the blaze. The shortage meant some people “have no other choice but to live in poorly equipped nursing facilities,” it said. In 2013, a disgruntled resident set fire to a home for the elderly in Heilongjiang province in northeastern China, killing himself and 10 others. ^ top ^

China's Canvest Environmental Protection to buy waste-to-energy plant (SCMP)
2015-05-27
Canvest Environmental Protection Group said on Wednesday its wholly-owned subsidiary Dongguan Kewei Environmental Power has agreed to buy a waste-to-energy plant in Laibin city, Guangxi Province for 73.3 million yuan (HK$91.61 million). The company said it agreed to acquire Laibin Zhongke Environmental Power, which owns the plant in Laibin, from two parties - Fujian Zhongan Tongyong Energy Environmental Protection and Beijing China Sciences General Energy & Environment. The waste-to-energy plant is under a build-operate transfer concession right in Laibin City, Guangxi Province. The concession right is for a term ending in April 2034. The transfer of the equity interest in Laibin Zhongke is subject to approval from the Municipal Administration of Laibin City. Canvest said the acquisitions will enable the company to broaden its income source and strengthen its asset base after the technological upgrade. It can also extend the geographical coverage to Guangxi Province which is an important step to develop the local market in the future. ^ top ^

China's yuan no longer undervalued, says IMF (SCMP)
2015-05-27
China's yuan is no longer undervalued after "significant" appreciation over the past 12 months, the International Monetary Fund said yesterday in the agency's first such finding in more than a decade. Even so, the IMF called on Beijing to make the exchange rate more flexible while quickening reforms in the state sector. The agency also forecast that China's growth might dip to about 6.8 per cent this year. The IMF announced its assessment yesterday after wrapping up the 2015 Article IV Consultation Mission to China. IMF first deputy managing director David Lipton joined the final policy discussions and met Vice-Premier Ma Kai, People's Bank of China Governor Zhou Xiaochuan and other regulators. China has expressed a strong wish for the IMF to include the yuan in the Special Drawing Rights basket in its October review. The SDR now comprises four currencies: the US dollar, the yen, the euro and the sterling. The IMF has said it is just a matter of time before the yuan is included in the basket, but has insisted the currency must first be freely convertible. Beijing has actively pushed forward the currency's internationalisation. HSBC estimated the share of yuan trade settlement might account for half of China's total trade by 2020, from just a little more than one-fifth last year. But the IMF said China's external position remains high, while Beijing needs to further reduce excess savings and achieve sustained external balance. "This will also require that, going forward, the exchange rate adjusts with changes in fundamentals and, for example, appreciates in line with faster productivity growth in China," the agency said. "We believe that China should aim to achieve an effectively floating exchange rate within two to three years." The IMF projected China's gross domestic product to grow 6.8 per cent this year, below Beijing's 7 per cent official target. In the first quarter, GDP growth cooled to just 7 per cent year on year - a six-year low - because of sluggish domestic investment growth and lacklustre external demand. "I do think there's a balance that has to be struck between promoting higher quality growth and maintaining stability in the economy", such as to calibrate local government spending and finance to "ensure neither rises too quickly", Lipton said. "Since the global financial crisis, growth has relied on an unsustainable mix of credit and investment that has resulted in rising vulnerabilities." Beijing should work on reducing such vulnerabilities faster when economic growth looked likely to exceed 7 per cent. However, if China's growth looked set to dip below 6.5 per cent, then fiscal policy should be eased, the IMF said. ^ top ^

China's defense white paper underscores commitment on peace, military transparency (Xinhua)
2015-05-27
The Chinese government Tuesday published the country's 9th defense white paper, and the document's title "China's Military Strategy" is solid proof that China is serious about honoring its commitment to peaceful development and its promise to improve military transparency. Since 1998, China has published a defense white paper every two years and every new document has shown a higher degree of transparency than the last. For anyone who is interested in flipping through these documents, the trend is obvious: In the 2006 defense white paper, China made its nuclear strategy public; in the 2008 document, the country revealed for the first time the statistics of its defense expenditures in the three decades since the start of the reform and opening-up; and the 2013 white paper revealed the designation of the Chinese Army's combined corps and the missile armament of the Second Artillery Corps. This year's nearly 9,000-word-long paper is the first to focus specifically on strategy, and discusses the most sensitive questions concerning China's military and security policy and its core. As many military experts would agree, laying bare its strategic intentions represents a very bold move for a country which has pledged to be more transparent about its military capabilities and war preparedness. For Western media organizations seeking to play up the ill-founded notion that China will extend its military reach possibly to the detriment of regional stability, they should be reminded that China is entitled to adjust its military strategy in accordance with the latest developments that may pose a security threat, since the same is happening everywhere. They should also take heed of the fact that China has played an irreplaceable role in maintaining regional stability and has been steadfast in pursuing peaceful development. Unlike world powers that adopt preemptive military strategies, emphasize preventive intervention and take the initiative in attacks, China takes a strikingly different path by following the principles of defense, self-defense and post-emptive strikes. China "will not attack unless we are attacked, but we will surely counterattack if attacked," the white paper states. Such a candid expression demonstrates China's growing confidence in its military prowess, but more importantly underscores its peaceful intentions. However, it will be hard to convince China-demonizers that the country is peace-loving in nature, since they always turn a blind eye to the country's track record on preserving peace and ignore the fact that China needs a peaceful and stable international environment to sustain its economic growth. But why bother? The best policy is honesty and China has been honest in carrying out its promise on military transparency and on peace. Time will show that China will never deviate from its path of peaceful development and will not pursue military expansion. ^ top ^

4 million Chinese children live in extreme poverty (Globaltimes)
2015-05-27
About 4 million pre-school children in China live in extreme poverty, a recent study showed, as observers said that direct support for poor families is essential to break the cycle of intergenerational poverty. Among about 36 million people in China who live in extreme poverty, 3.3 to 4 million are children aged 0 to 6 years, according to a report released by the All-China Women's Federation and National Health and Family Planning Commission. The report shows that the children suffer from malnourishment are six to eight times more likely to grow at a slower rate than those living in urban areas. More than half of children living in extreme poverty suffer from zinc deficiency, the report said. A staff member from the research team said that some 6-year-old children he saw in rural areas were only as tall as 2-year-old's. Many rural mothers leave to work in cities, and the report shows that 24.8 percent of infants are breast-fed in the first six months, much lower than the national average of 27.6 percent and the worldwide average of 38 percent. Experts said that breaking the cycle of intergeneration poverty through direct support for poor families is key to solving poverty issues plaguing the world's second-largest economy. "If we fail to get these children out of poverty, the cycle will continue and further polarize society. The central government has shown its resolve and has come up with measures to fight poverty. But there is much room for improvement in the policy's implementation," Du Xiaoshan, a researcher at the Rural Development Institute of the Chinese Academy of Social Sciences, told the Global Times. Concerted efforts are needed by the central and local governments, media and third-party regulator, as well as society in monitoring and ensuring that the money goes directly to families in need, Du noted. Local governments also generally lack well-trained personnel who can properly implement poverty alleviation policies. In November, the State Council approved the Underprivileged Children's Development Plan (2014-20), pledging benefits ranging from better prenatal care to effective and affordable education. ^ top ^

Newspaper source who gave boost to Chinese stocks is 'top leader' (SCMP)
2015-05-28
An article on the website of the People's Daily overseas edition yesterday hinted that an "authoritative insider" who was quoted by the paper's domestic edition in a story that helped send Chinese stock markets rocketing this week was a top national leader. The People's Daily on Monday published an article headlined "Five most pressing questions on the Chinese economy - an exclusive interview with an authoritative insider", stressing that investment had an important role in bolstering growth and reviving investment. The article also appeared in its English edition. On the same day, the National Development and Reform Commission (NDRC) rolled out a 1.97 trillion yuan (HK$2.5 trillion) investment plan by inviting private investors to help fund, build and operate 1,043 public-private partnership projects ranging from highways to tunnels. In the article, the insider said investment had a vital effect on growth. "Seen from the stage China is at right now, whether it can transfer savings to effective investment will be the key to stable economic growth," he said. More financing channels should be explored to exploit the potential of private capital and transfer more savings into investment, he was quoted as saying. The paper, which in recent months has run a string of articles to inform the public about the stock markets and the nation's economic outlook, is seen by investors as an important window on Beijing's thinking on policy. On Monday, the Shanghai Composite Index posted its biggest single-day rise in four months, led by infrastructure and transport shares. It was up by 3.35 per cent to close at 4,813.80. On Wednesday, the article from the People's Daily overseas edition's website written under the pen name Xiakedao, asked: "Who is the authoritative insider in the People's Daily?" The article said the term "authoritative insider" had been "hot" in recent days because the People's Daily had carried an interview with such a source talking about the economy. "The stocks posted strong gains during the past two days and everyone was happy," it said. "Xiakedao doesn't know why, even if he knows he wouldn't tell you, but we could discuss who this authoritative insider is - it's a figure we're familiar with." The article said in the past, essays authored by Mao Zedong were often published anonymously under the byline: "authoritative insider". "Even if they were not penned by Mao Zedong himself, they manifested the intention, character and style of China's top decision-making level," it said. "Because of their mysterious nature, articles [of this kind] are all the more attractive," it said. Cheng Yizhong, a former chief editor of the Southern Metropolis Daily, said "shrouding things in mystery" was a propaganda strategy of the Communist Party. ^ top ^

Chinese firm slapped with province's biggest pollution fine, staff jailed (SCMP)
2015-05-27
A court in eastern Zhejiang province has fined a manufacturer of weed killer 75 million yuan (HK$95 million) and jailed the company's employees and contractors for discharging waste water that severely polluted streams in the area. The fine levied by the Longyou county court on Jinfanda Biochemical - which makes the herbicide, glyphosate - was the largest ever for a polluter in the province, state media reported on Tuesday. Zhejiang is one of the most prosperous but also most polluted provinces on the mainland. Rapid economic growth and lax enforcement of regulations over the past decades have caused severe environmental damage throughout the country. Beijing has promised to strictly enforce environmental laws and severely punish polluters in response to rising demands from citizens that air, water and soil be cleaned up. Last December, a court in Jiangsu province ordered six companies to pay 160 million yuan for discharging waste chemicals into rivers. It was then the country's biggest environmental fine. Last month, Beijing environmental officials fined a french fry supplier to the McDonald's restaurant chain 3.8 million yuan for releasing waste water. It was the city's biggest pollution fine. The Longyou county government said Jinfanda hired four unqualified firms that dumped 35,000 tonnes of hazardous waste into streams. The court convicted the company on May 18 and fined it 75 million yuan. One contractor was fined 4 million yuan. It also sentenced 18 defendants to prison for terms ranging from 17 months to six years, and fined them between 1,000 yuan and 1 million yuan. ^ top ^

Environmental bureaus duck waste incineration plant safety queries (Global Times)
2015-05-28
Only 39 out of 160 waste incineration plants in China answered inquiries about how they deal with their fly ash, and the air pollutant discharge of most plants exceeded national standards, two environmental protection organizations reported recently. The organizations also queried environmental protection authorities, which are legally obliged to respond, but authorities frequently gave late, incomplete or no answers, said a report sent to the Global Times by Friends of Nature and the Wuhu Ecology Center. Fly ash is made of fine particles that rise with the gases that result from incineration. There is little public information about how waste incineration plants dispose of their toxic fly ash, which contains the carcinogenic agent dioxin. The two organizations requested 103 environmental protection bureaus disclose their monitoring data for 10 major air pollutants in 2014. They also asked 160 incineration plants to explain how they dispose of fly ash. According to the report, 51 bureaus responded with data about air pollutants discharged by 65 waste incineration plants. Of those, 45 exceeded national standards. Out of the 39 plants that explained how they dispose of fly ash, 26 sent it to a landfill, five used it as construction material and only eight sent it to qualified hazardous waste disposal sites, according to the report. "Fly ash is categorized as hazardous waste but the disposal situation in China is bad," Yue Caixuan, head of the solid waste project of Wuhu Ecology Center, told the Global Times. Pollutants contained in the fly ash, like dioxin, might be exposed in the air if it is made into construction materials, Yue said. The organizations aimed to urge authorities to strengthen supervision over waste incineration plants by applying for information disclosure, but most environmental protection agencies gave inadequate replies, especially in Beijing, Shanghai and Guangzhou. Some local governments issue subsidies to waste incineration plants to help them deal with household waste. Yue said the amount of pollutants from incineration would be reduced if people sorted their garbage into different categories while disposing of it. "We hope more citizens learn about waste incineration," said Yue, adding that the waste could become a valuable resource with the right approaches. ^ top ^

Why China's factory workers are slowly winning their battle for stronger labour rights (SCMP)
2015-05-27
As workers gathered around a table in a cheap restaurant to discuss strike action against their shoe factory bosses, Chinese police barged in and dragged away their leaders. More than 2,000 employees at the plant, which counts foreign brands including Coach among its customers, according to workers, had downed tools, camping out on brightly coloured mats to demand unpaid benefits. “They burst through the door and told us not to move,” a woman worker said. Several said police had beaten them and one woman wore a large bandage covering injuries on her back. The organisers were held for less than a day, but the walkout by the whole staff paralysed production last month and weeks later the workers claimed victory. Once renowned for their cheap wages and docility, the protest at the Taiwanese-owned plant is an example of how employees in the workshop of the world are increasingly standing up for greater benefits. “Ten years ago we didn't have any conception of the law or defending our rights,” said a male worker, who like others asked not to be named for fear of reprisals. Low-cost labour has been key to China's decades-long economic boom and the newfound activism has the authorities worried. The grey Lide facility in Panyu city is one of tens of thousands of factories in the southern province of Guangdong producing everything from denim jeans to smartphones. Finance minister Lou Jiwei last month warned that China risks falling into a “middle income trap” if high wages make manufacturing less profitable before the country can shift to less labour-intensive, more value-added industries. He called legislation promoting bargaining between workers and employees ”scary”, and blamed excessive “union power” for the multiple bankruptcies in the US auto industry. There were 1,379 protests by workers in China last year, more than tripling in just three years, according to data from the Hong Kong-based China Labour Bulletin. That included China's biggest strike in decades, when tens of thousands of employees at Yue Yuen, another Guangdong factory that makes shoes for Nike and Adidas, won concessions despite worker arrests. The Communist Party fears an independent labour movement and only allows one government-linked trade union federation, that claimed 290 million members at the end of 2013, which tends to side with employers. But campaigners say employees have been empowered by a labour shortage and recent laws giving them greater rights. “They are not only aware of their rights, but understand that they are part of the working class, a class that increasingly has the strength and ability to forge its own destiny,” the China Labour Bulletin said. When activist Wu Guijun arrived in the manufacturing hub of Shenzhen 13 years ago, strikes were almost unheard of, despite his meagre monthly wages of just a few hundred yuan. “Workers struggled individually and rarely spoke of defending their rights,” he said. Now migrants from the countryside to China's cities who make up the bulk of factory labour, have seen their average monthly earnings reach 2,864 yuan (HK$3,600) last year, up 10 per cent on 2013. The rise has been driven by both growing prosperity and supply and demand: China's working-age population is shrinking. Workers have been emboldened, Wu said. “As their living standards improved, they have started to pursue the respect and status they deserve from society.” Wu turned to activism after leading his co-workers in protest when his furniture factory faced sudden closure in 2013. Despite striking or organising walk-outs not being illegal, Wu was detained by police for more than a year until prosecutors dropped charges of “gathering a crowd to disturb public order”. Given a compensation payout of more than 70,000 yuan for unwarranted detention, he founded his own labour rights organisation, the 100 Million New Labourers Centre. In a borrowed office stocked with pamphlets on Chinese labour laws, Wu advises young workers on strike tactics and how to use social media, despite the constant threat of police harassment and detentions. “The government is still very nervous about workers' activism,” Wu said. The authorities face a dilemma between raising living standards for ordinary people, a key part of their claim to a right to rule, and ensuring healthy profits for local industries, often with close official connections. At the same time they consider social unrest anathema and want to see economic growth, but China is facing increasing labour cost competition from elsewhere in Asia. In the face of rising inequality, China's government over the last decade passed landmark laws establishing employee rights including social insurance payments from employers, and compensation when factories relocate. But the Lide shoemakers had no doubts where the authorities stood. “The government here just pressures us workers. It speaks on behalf of the bosses,” said one worker of more than a decade. None of the companies involved, or the police, would comment for this article. After the six-day stoppage, employees went back to work, saying they had won sufficient concessions. “We basically got what we wanted,” said one female worker. “But our pay is still low. How can we be satisfied?” ^ top ^

Beijing-Tianjin-Hebei rolls out measures to tackle air pollution (China Daily)
2015-05-27
Beijing and Tianjin will give financial and technological support to four cities in Hebei province to help them tackle air pollution. In addition, the six cities are to build a unified emergency response system to cope with heavy smog. Beijing will join forces with its two southern neighbors, Langfang and Baoding, while Tianjin will work with the neighboring port cities of Tangshan and Cangzhou, the Beijing Environmental Protection Bureau said. The cities in Hebei will receive special funds and advanced technology from the two municipalities. All six cities, which form the core area for regional efforts to control air pollution, are to build a unified system to forecast heavy smog and implement emergency response measures. The project will draw on the experience gained from the coordinated efforts made during the Asia-Pacific Economic Cooperation meetings in Beijing in November, the capital's environmental bureau said. The cities currently have their own emergency systems and impose different restrictions on the use of vehicles on smoggy days. During the APEC meetings, the governments of Beijing and Tianjin, the provinces of Hebei, Shandong, Shanxi and the Inner Mongolia autonomous region jointly adopted tough measures to improve air quality. Work at more than 14,000 factories in polluting industries and 40,000 construction sites was suspended. Their efforts meant that residents saw a clear improvement as the concentration of PM2.5-airborne particles measuring 2.5 micrometers or less that can penetrate the lungs and harm health-was reduced by 30 percent in Beijing, Fang Li, deputy head of the bureau, said in November. The coordinated efforts by the six core cities are expected to reduce air pollution in a similar way, the bureau said on Tuesday. Officials set out a number of major areas in which action will be taken this year-cutting vehicle exhaust emissions and coal consumption, reducing the amount of straw that is burned by farmers, phasing out industrial overcapacity, lowering emissions of volatile organic compounds and reducing pollution at ports. Seven of the 10 Chinese cities with the worst air pollution are in Hebei, but the province is making efforts to take at least Langfang off the list this year, the provincial Environmental Protection Bureau said on Wednesday. Beijing needs to control the amount of pollutants blown in from other areas, since they are a major cause of smog in the capital, according to Ma Zhong, dean of Renmin University of China's School of Environment. Research by the Beijing environmental bureau found that 28 to 36 percent of PM2.5 in the atmosphere over the capital comes from surrounding areas, including Hebei. Beijing should compensate Hebei for the economic losses caused by closures of factories that cause pollution and the introduction of more advanced technology, Ma said. In addition, the governments need to unify standards on pollutant emissions, oil quality and sewage discharges. ^ top ^

Prosecutors act to curb child abuse (China Daily)
2015-05-28
Prosecutors are to step up their efforts to tackle cases involving the sexual abuse of children, the Supreme People's Procuratorate said on Wednesday. "We will adopt a zero tolerance approach to the sexual abuse of minors and attempts to force them to engage in prostitution," said Xiao Wei, a spokeswomen for the authority. "Once we obtain solid evidence we will immediately arrest and prosecute suspects." Zhang Xiangjun, deputy director of the authority's prosecuting department, said national prosecutors will attach great importance to investigating misconduct by officials who fail to act over such offenses. In addition, legal aid and psychological counseling for minors will be improved. "If we discover that government officers have detected such crimes but have not taken effective measures to stop them, and this results in minors dying or suffering severe injuries, they will be held criminally accountable," he said. High-profile cases involving the sexual abuse of minors, abduction and forced prostitution have occurred nationwide in recent years. According to the procuratorate, last year national prosecuting departments charged 3,239 suspects with sexually abusing minors, obscene behavior or luring young people into prostitution, a sharp increase compared with 2013. From 2010 to 2013, national prosecutors charged more than 8,069 suspects with lewd behavior with minors in 7,963 cases, and prosecuted 255 people charged with sexually abusing young girls in 150 cases. "A lack of awareness among minors, parental negligence and flawed safety management in schools and society have all contributed to the sexual abuse of minors," Zhang said. Tong Lihua, director of the Beijing Children's Legal Aid and Research Center, said few Chinese parents are aware of the importance of sex education. Primary and middle schools offer only health classes to minors rather than providing sex education, and most young victims do not know how to protect themselves. "Due to the lack of sex education, some juveniles may not realize they have been sexually abused, and when such crimes occur they are often afraid to report them to the police," Tong added. Shi Weizhong, a senior official at the prosecuting department, said in an earlier interview that most young victims of sex abuse are under 14 and come from the families of migrant workers or single-parent families. Tong said: "The laws to protect minors were revised in 2004 and lag far behind the practical needs. The priority is to have up-to-date laws to protect minors' rights. The judicial authorities and the civil affairs, education and healthcare sectors will then have clearly defined tasks and be able to work closely to fight such crimes." ^ top ^

Tibetan mother-of-two stages self-immolation protest against China (SCMP)
2015-05-29
A Tibetan woman set fire to herself in a protest against Chinese repression in northwestern Gansu province in the second such protest this month, according to a Tibetan rights watchdog and reports on Thursday. The US-based International Campaign for Tibet said Sangye Tso, a 36-year-old mother of two, staged the protest outside a Chinese government building in Gannan Tibetan Autonomous Prefecture on Wednesday and is believed to have died. Tibetan sources in exile were quoted as saying that the government building is a local symbol of Chinese oppression. Armed police raided the homes of her family and detained some of her relatives, the sources said. Last week, Tenzin Gyatso, a 25-year-old father of four, set himself on fire and died near a government building in Daofu county of the Ganzi Tibetan Autonomous Prefecture, in a protest against the deployment of Chinese forces in the area to put off celebrations of the 80th birthday of exiled Tibetan leader the Dalai Lama, Tibetan news portal Phayul reported. Including Sangye, 141 Tibetans are known to have protested against Chinese repression through immolation since 2009. Among them, 115 have died. The Tibetans call for the return from exile of the Dalai Lama, who is vilified by China as a “separatist” for seeking autonomy for the Tibetan people. China has blamed the Dalai Lama “clique” for orchestrating the string of self-immolation protests and rejected Tibetans' claims of repression. ^ top ^

Artist detained for posting humorous portrait of China's president (SCMP)
2015-05-29
The wife of a Chinese artist says the authorities have detained him after he posted a humorous portrait of President Xi Jinping online. Judy Zhu said police have accused artist Dai Jianyong of creating a disturbance after they detained him on Tuesday near their Shanghai home. Shanghai police did not respond to calls asking for comment on Thursday. Dai is known for posting eclectic photographs on social media, including some showing himself and others scrunching up their lips and eyes. He posted images of Xi with the same expression while wearing a moustache. He has also printed stickers of the portrait of Xi. The authorities have tightened their grip on political dissent and have cracked down on artists who supported pro-democracy protesters in Hong Kong last year. Dai could face up to five years in prison if convicted of the offence. ^ top ^

Blackmail probe into cadre at Communist Party-linked website (SCMP)
2015-05-29
A deputy editor of a Communist Party-affiliated website has been suspended and put under investigation over alleged threats to blackmail companies, according to mainland media reports. Xu Hui, a deputy editor at People.cn a website owned by party mouthpiece People's Daily, approached various companies and threatened to run negative stories about their products if they did not take out advertising on the site, online portal NetEase reported late on Wednesday. People's Daily notified some cadres about the case last Friday, the report said before it was pulled from the website, other news portals and social media sites yesterday morning. Other senior officials at the website were also reportedly implicated in Xu's case. People.cn declined to comment to the South China Morning Post. But one source said Xu was taken away on May 20 over a case related to a major oil company. "His name was mentioned when someone from the company was investigated [by discipline inspectors]. Several companies had previously complained about him so they decided to investigate him," the source said. Xu graduated from Beijing's Renmin University and was director of People.cn's business department and assistant to the website's director before becoming its deputy editor in 2011. He was in charge of the website's external relations and frequently gave speeches at public events. His last public appearance was in Wuxi, Jiangsu province, on May 9. People.cn was the first state-owned media firm to go public when it listed on the Shanghai Stock Exchange in 2012. The case against Xu comes as mainland authorities continue their year-long crackdown against corruption in media organisations. Shen Hao, former president of the group that owns the 21st Century Business Herald newspaper, Moneyweek magazine and the 21cbh.com financial news portal, was arrested with about 25 colleagues in September. They were accused of running "a massive extortion racket", in which reporters would allegedly blackmail companies into signing lucrative advertising deals in return for dropping negative coverage. Last month, the national media regulator ordered the Herald 's popular website to shut down and revoked the publishing permit for Moneyweek. But in a similar case last year, the Central Commission for Discipline Inspection, the party's graft watchdog, ordered the Shanghai branch of Xinhua News Agency to return 3.5 million yuan (HK$4.43 million) the Bank of Communications had paid for stories and to prevent negative reports. No one was arrested. The former party chief and chief editor of Xinjiang Daily, Zhao Xinwei, was also under investigation for disciplinary violations, the local disciplinary watchdog announced yesterday. ^ top ^

British Chinese volunteer fighting alongside Kurds against ISIS in Syria becomes a weibo hero (SCMP)
2015-05-29
Photos of a British Chinese volunteer in the fight against the Islamic State in Iraq and Syria (ISIS) have gone viral on mainland social media after he posted photographs of everyday life as an international freedom fighter on his weibo account. Huang Lei, who goes by the username “LeiG7”, is one of a group of international volunteers that includes military veterans and others with no combat experience, who have travelled to Syria to help Kurdish guerillas according to an report in The Daily Telegraph, a British newspaper. Huang's latest post, on May 23, shows photos of him and his teammates holding up an ISIS flag after an apparent victory somewhere in northern Syria. “An area in Northern Syria was finally liberated from the hands of ISIS!” Huang writes. “I was very lucky to have captured the IS flag! We won, even though it's only a small place!” As of Thursday, the entry had been reposted some 20,000 times. According to his weibo entries, Huang has been stationed near Al-Hasakah in the northeastern corner of the war-torn country for more than three months. One photo shows Huang standing proudly in front of a wall lined with weapons. He's showing a thumbs up sign, while behind him big black letters spell Team Freedom above a line of larger Chinese characters that read “justice will prevail”. In an intervew with the popular independent media blog Global Watch on Wednesday, Huang claimed to be a native of Sichuan province who moved to the UK when he was very young where he later earned a Bachelor's degree from the University of Manchester, Huang and his fellow fighters have fought alongside the Kurdish People's Protection Unit, also known as YPG. “I am not a hero and I don't want to be a one,” Huang said. “But I'm very proud to be fighting IS with a group of heroes from around the world.” ^ top ^

Online activist denounced by State media (Global Times)
2015-05-29
Chinese State media on Thursday accused an online activist of viciously plotting "performance art" to attack the government, as the government continues cracking down on illegal online activities that masquerade as rights protection. Activist Wu Gan earned the nickname "Butcher" in 2009 when he called for netizens to donate to Deng Yujiao, a waitress from Hubei Province who stabbed a local official to death due to his sexual taunts, according to the Xinhua News Agency. "He has since been seen in various social issues with his vulgar performances. He later got bolder, resorting to illegal measures to maliciously attack the government, which he boasts are 'performance art,'" People's Daily reported. Xinhua went on listing examples of Wu's "performance art." In a land acquisition case in 2012, Wu posted pictures of himself making dirty gestures with a naked female mannequin whose face bore the photo of a female official of Fujian Province, as a way to humiliate and put pressure on local authorities. Wu has pressured authorities with so-called bounty hunts, in which he offers money for dirt on officials, knowing that they fear trouble and media hype, according to Xinhua. The agency quoted Wu as previously saying that "the biggest fear of officials is losing their job, so we can target their weakness." Wu recently offered a 100,000 yuan ($16,000) reward for the surveillance video of the police shooting in Qing'an, Heilongjiang Province, where a man who attacked the police at the local railway station was killed, according to The Beijing News. "People like Wu often seek profits for themselves illegally in the name of justice and safeguarding legal rights. It has been a clear signal since late 2013 that China is determined to crack down on such illegal activities to build a clean and healthy online society," Zhi Zhenfeng, an associate research fellow at the Institute of Law, Chinese Academy of Social Sciences, told the Global Times. Zhi compared Wu to Dong Liangjie, an environmentalist, who was detained for spreading forged information online in 2013, and Yang Xiuyu, who was sentenced to four years in prison for illegal business practices, including making profits by posting false information. However, Yu Guoming, a professor at the Renmin University of China, pointed out that Wu and other activists serve to drive the authorities to conduct investigations and improve transparency. Wu was detained by Fujian police on Wednesday for inciting trouble and libel. He was previously under administrative detention in Jiangxi Province for disturbing order at courts and publicly insulting others, after he put up posters with insulting accusations against the leaders of the Jiangxi high court. "Apart from imposing punishment on Wu for his extreme and vulgar activities, authorities must reflect on themselves to find the root of the problem - administrative nonfeasance and the lack of transparency in some government bodies still lay as obstacle for people to safeguard their rights," Xie Zhiyong, a professor at the China University of Political Science and Law, told the Global Times. ^ top ^

 

 

Xinjiang

China breaks up '181 terrorist groups' in Xinjiang (SCMP)
2015-05-29
The authorities in the northwestern region of Xinjiang say they have broken up 181 terrorist groups since they launched a security crackdown a year ago. The government has blamed a series of violent attacks in the region and other areas of China on separatist Islamic militants from Xinjiang. The Communist Party committee in the region said 96.2 per cent of the gangs were discovered while they were planning attacks, the state-run news agency Xinhua said. Some 112 suspects had turned themselves in to the police, according to the report. The security crackdown was launched after 39 people were killed in May last year when attackers drove two four-wheel drive vehicles into a market in Urumqi and hurled explosives at passers-by. Four of the attackers were also killed. The authorities in China have long sought to contain and control what they call religious extremists who want to establish an independent state in Xinjiang called East Turkestan. Groups representing ethnic Uygurs in the region and human rights activists say government policies repress the minority group's culture and religion, fuelling conflict, an allegation Beijing strongly denies. The East Turkestan Islamic Movement has been listed by the United Nations Security Council as a terrorist organisation. Three men were executed in March for organising a knife attack at Kunming railway station in southwest China last year that left 31 people dead. ^ top ^

 

Hongkong

After Occupy, democracy activists gear up for battle of Hong Kong electoral reform (SCMP)
2015-05-29
Pro-democracy groups are joining hands again, six months after the 79-day Occupy campaign ended, in a new movement calling for all lawmakers to vote against the government's political reform package next month. Prominent among the 14 co-organising groupings are the Civil Human Rights Front, student-led Scholarism, Civic Party, Labour Party and Democratic Party. They will launch their "citizens against fake democracy movement" on June 7, with at least 200 activists gathering outside the Cultural Centre in Tsim Sha Tsui before fanning out to various parts of the city in seven teams to stage half-day marches. Their marches would stand "in stark contrast to the propagandistic campaign of government officials" in the last few weeks that began on an aloof note when ministers stayed on board their open-top bus throughout a "flash mob"-style tour of the city, said Edward Lau Wai-tak, convenor of the group Ignite Your Belief. Activists will engage residents and explain why lawmakers should vote down the reforms, as well as promoting a parade tentatively slated for June 14 or 21 from Victoria Park to government headquarters at Admiralty. The front's convenor, Daisy Chan Sin-ying, recalled their vow back when the Occupy protests ended in December with police clearing the Admiralty zone. "We told the world we would be back," Chan said. "I hope all those who took part in the 'umbrella movement' would return to our battlefield outside the Legislative Council and present the voice of the public." The exact date would depend on whether the administration tabled its package in Legco on June 17 or 24, she said, as the groups aimed to rally outside the premises every day until the vote. All 27 pan-democratic lawmakers vow to vote against the package as it follows Beijing's stipulations to allow only two or three candidates endorsed by a 1,200-strong nominating body to move on to a popular ballot for chief executive in 2017. Chan dismissed suggestions that the Legco rallies were intended to pressure those pan-democrats into keeping their word. "We will invite all lawmakers to join our rally and say no to fake universal suffrage." She hoped to see 100,000 participants, she said, but the front would not encourage them to engage in civil disobedience by staying overnight outside Legco or occupying roads. Noticeably absent was the Federation of Students, which played a leading role in Occupy but, since February, had lost half of its memberships. Federation leaders were discussing what role it should take in this new movement, Chan suggested. Meanwhile a Democratic Alliance for the Betterment and Progress of Hong Kong survey found 61.9 per cent of respondents said Legco should pass the package, 32 per cent said no. The study polled 1,070 people before May 18. Its margin of error was plus or minus three percentage points. ^ top ^

Hong Kong 'still top choice for China's rich' investing outside the mainland and overseas (SCMP)
2015-05-27
Hong Kong remains the top offshore investment option for the mainland's moneyed elite thanks to its proximity, low tax rate, cultural similarities and global access, according to a survey released yesterday. Consulting firm Bain & Co said the survey, conducted jointly with China Merchants Bank, polled roughly 2,800 mainlanders who had more than 10 million yuan (HK$12.5 million) in investable assets and had overseas investments. Of those about 71 per cent said Hong Kong was their preferred offshore investment destination. The United States was seen as a good option for 54 per cent of the respondents, while Australia was well regarded by 17 per cent. The study, which is conducted every two years, found that interest in overseas investment was growing among the high net-worth individuals. About 37 per cent of the respondents in this year's study said they had financial products and property outside the mainland, compared to 33 per cent in 2013 and 19 per cent in 2011. This percentage is even higher among the super-rich, with 57 per cent of people with more than 100 million yuan of investable assets having money offshore. "Hong Kong has always been a top choice for Chinese high net-worth individuals," said Wang Jing, general manager of the private banking department at China Merchants Bank. "The city provides a variety of choice for people to invest globally. In addition, there is no time difference [with the mainland] and the language and cultural environment are familiar to mainland customers. "The legal system and low tax rate are also reasons that attract them." Wang said she believed Hong Kong's appeal for mainland investors would continue, although the city had tightened its immigration policy and seen slower growth in mainland visitors in recent years. "Compared to places like the United States and Australia where mainland investors tend to buy property, Hong Kong is a popular choice for [mainlanders] to invest in stocks and other financial products. This has not changed," she said. According to the study, the mainland had more than one million high net-worth individuals by the end of last year, double the total for 2010. The total private wealth market grew 16 per cent annually between 2012 and 2014 and reached 112 trillion yuan last year. In the last two years, wealthy mainland investors have bulked up their holdings in stocks and other financial products such as venture capital and private equity. Meanwhile, fixed-return products like bonds and bank asset-management products have taken a smaller share of their investments. Nearly two-thirds of respondents in the study said "wealth preservation" and "wealth inheritance" were their two top concerns. And 65 per cent said they also wanted to leave their children a spiritual legacy, such as an understanding of the importance of working hard and the value of a good education. The researchers found that a group of "newly rich" is emerging on the mainland. This group of people mostly work in IT, biotechnology, and environmental and high-end manufacturing. Eighty per cent of them were aged under 50 and had a more open and aggressive investment style, it said. ^ top ^

Sharp correction in Shanghai, Shenzhen and Hong Kong stock markets (SCMP)
2015-05-29
Analysts predict today will see more selling of mainland shares after the sharp correction in the Shanghai, Shenzhen and Hong Kong stock markets yesterday, in a vicious cycle of selling as margin calls accelerate with the falling markets. In one of its biggest single-day drops, the Shanghai Composite Index plunged 6.5 per cent to 4,620.27 points yesterday, while the Shenzhen Composite Index plummeted 5.52 per cent to 2,756.93 points. The Hang Seng Index closed down 2.23 per cent, or 626.9 points, at 27,454.31 points in its biggest one-day fall since December, while the Hang Seng H-share Index closed down 3.53 per cent, or 518.88 points, at 14,183 points. The total value of stocks traded in Shanghai and Shenzhen reached a record of 2.42 trillion yuan (HK$3.06 trillion), breaking Tuesday's milestone of 2.16 trillion yuan. Louis Tse, a director of VC Brokerage, said there could be continued selling of mainland shares today in response to margin calls. "It's a domino effect," he said. When stock prices fell, creditors who lent investors money to buy stocks would call in their margin loans, which would prompt further selling to repay the loans, Tse explained. There had been margin calls in the Hong Kong stock market yesterday, he said. Margin debt on the mainland has more than tripled to over 2 trillion yuan from 400 million yuan in April last year, according to Credit Suisse. Unless there was positive news from the mainland, Hong Kong stocks would also come under selling pressure today because of margin calls, Tse predicted. Jason Chan, associate manager at Southwest Securities, said market jitters weighed on mainland financial stocks after Central Huijin Investment, a state-owned investment firm, sold 1.63 billion yuan of Industrial and Commercial Bank of China A shares and 1.91 billion yuan of China Construction Bank A shares on Tuesday. ANZ Research noted recent reports that the People's Bank of China had drained 100 billion yuan of liquidity from mainland banks by selling them bond repurchase agreements, raising fears that the central government might end its monetary easing. ANZ said it did not indicate a change of government monetary policy, but rising credit risks had made many mainland banks more risk averse. State news agency Xinhua said another reason for the sell-off was the recently toughened regulation of the capital markets by the China Securities Regulatory Commission and China Banking Regulatory Commission. On May 22, the CSRC's website announced a raft of penalties for illegal stock market activities. "The correction seems to be driven by investors selling to have funds for the next wave of IPOs as well as margin lending tightening," said Gerry Alfonso, a director of Shenwan Hongyuan Securities. "It is logical that after the enormous growth in [margin lending] business, brokerage houses are starting to become more cautious." ^ top ^

 

Taiwan

Taiwan's Hou Hsiao-hsien wins best director award at Cannes film festival (SCMP)
2015-05-29
Taiwan's Hou Hsiao-hsien has scooped the best director award at the Cannes Film Festival for his slow-burning minimalist drama The Assassin. The film is set in 9th-century China at the end of the Tang dynasty, with Asian megastar Shu Qi playing a highly trained woman assassin who fails in a mission and is sent back to her home province to kill its governor, the man she also loves. Despite its action-packed premise, the film is a study in lingering, contemplative art from director Hou, who continues a similar aesthetic from his previous films Millennium Mambo and The Puppetmaster. Speaking through an interpreter, Hou kept his acceptance speech short and sweet, saying: "It's difficult to make cinema, to find financing. I want to thank all my crew and cast." Taiwanese President Ma Ying-jeou sent his congratulations to Hou. "The innovation and its colourful way of telling the story has inspired a new trend in the art of film and shone in international skies, vying for glory for Taiwan," he said. The 68-year-old is one of the most recognisable names in Taiwan's "New Wave" cinema, having won a string of international film prizes, including the Golden Lion at the Venice Film Festival for City of Sadness in 1989 and the 1993 Cannes Film Festival third-place prize for The Puppetmaster. Born in Guangdong province in 1947, Hou moved to Taiwan with his family the following year to escape the civil war on the mainland. He started working in the film industry in 1973 after graduating from college with a film degree and shot his first feature film, the romantic comedy Lovable You (1981). Hou is best known for lingering camera shots and minimalist dramas depicting the upheavals in Taiwan in the 20th century. His autobiographical movie A Time To Live, A Time To Die (1985) told the story of a family that fled to Taiwan from the mainland in the 1950s. City of Sadness, which won him international recognition, touched on a taboo, the February 28, 1947 massacre by nationalist Kuomintang troops that took over Taiwan from the Japanese colonial power after the Second World War, and a family caught up in the political turmoil. Three Times portrayed three love stories set in three different periods and competed for the Cannes film festival's Palme d'Or in 2005. ^ top ^

 

Economy

Yuan's inclusion in IMF's currency basket faces economic, political hurdles (SCMP)
2015-05-28
The International Monetary Fund's finding that the yuan is no longer undervalued would appear to boost its chances of inclusion in the agency's Special Drawing Rights basket, but analysts caution that politics, as well as economics, will weigh heavily on any such decision. Despite the yuan's leading share in world trade, controversies remain over whether it fits the IMF's criteria of being "freely usable". And observers say the decision will be politically sensitive amid growing concern from the West about Beijing's rising power. The IMF said on Tuesday that the yuan was no longer undervalued after substantial appreciation over the past year. But it urged Beijing to make the exchange rate more flexible. In a review in October, IMF board members will decide on whether the yuan should be added to the SDR basket, which is now made up of the US dollar, the sterling, the yen and the euro. "In the end, this year's decision about the SDR basket will be made on political as much as on economic grounds, which means it will be determined by the governments with the most influence at the IMF, including the US," said Capital Economics' Andrew Kenningham. Chinese leaders have expressed desire for the yuan to be added into SDR this year. But Washington's concern about losing dominance in the global order has grown, observers say, particularly after many of its allies joined the Beijing-led Asian Infrastructure Investment Bank. "The [SDR] issue is mainly a political issue," said Ding Yifan, a senior researcher at the Development Research Centre of the Chinese State Council. If the IMF listed the SDR inclusion as a special matter that required an 85 per cent majority vote, then the United States, with its 16.74 per cent voting rights, could easily reject the proposal, Ding said. But if only a 70 per cent majority vote were needed, then China would "have every chance to win", he said. Based on the IMF's explicit criteria, "there is a reasonably high chance that this year's vote will go China's way", Citigroup economist David Lubin said. The yuan is currently the fifth most used currency in international payments, and the fourth most used in international money market instruments, although its use in bonds remains small. Helen Qiao, Morgan Stanley's managing director for research, said inclusion in the SDR basket could "boost the yuan's role in the international monetary order in the medium to long term". It might also spur institutional investors to increase yuan assets in their portfolio, Qiao said. But she warned that lobbying the IMF board members might be challenging for Beijing given the short time left. "It would require an arduous campaign to gain nods from the IMF by the end of this year," she said. ^ top ^

 

DPRK

North Korean economic reforms tightly tied to domestic conditions (Global Times)
2015-05-27
A series of proactive measures to adjust economic policies and expand exchanges with foreign countries recently adopted by North Korea have drawn widespread attention. The moves aim to help the country escape the long-lasting economic woes, improve the nation's political and social stability, and promote economic cooperation within the region. Therefore, they deserve welcome and encouragement. However, it is inappropriate to regard these measures as a signal of overall reforms or a starting point of further opening-up. North Korea is always reluctant to label its measures for economic development as "reform and opening-up." To begin with, China's implement of reform and opening-up is based on absolute disapproval of the mistaken route that deemed class struggle as the guiding principle. Yet North Korea, as a hereditary regime, does not allow any doubt or modification of its former leaders' ideologies and political lines such as juche ("self-reliance") and songun ("military-first"). Besides, China's reform has broken the traditional planned economy and set up a market-oriented socialist economy with the coexistence of other diverse forms of ownership, especially allowing the development of private business. But North Korea still cleaves to its old beliefs that planned economy and the public ownership of the means of production are the key characteristics of socialism, and that if they are changed, socialism will be lost. In addition, as a big country, China enjoys strong tolerance and endurance. Even it is wide open to the world, under the pressure over intruding foreign cultures and values, it can still safeguard its political and social stability. North Korea, however, will find it hard to do the same if it opens up like China, against the backdrop of US hostility, the north-south divide, and fierce competition over systems. Consequently, North Korea took the measures of "our-style (North Korea-style) socialism" and corresponding "reforms," including the 7.1 Economic Management Improvement Measures, 6.28 Economic Reform Measures and 5.30 Measures. Though similar to the reform and opening-up of China, they have their own distinguished features. For instance, the country initiated "land contracts," yet did not end cooperative farms; it encourages its business to be flexible, yet without changing the way their property is held; it established special economic zones and economic development zones, but with focusing on advantageous areas and corridors. The basic features of North Korean "reform" measures are improving the policy flexibility, introducing new management styles, and bringing the function of the market into full play, without changing its fundamental system. The country also introduces and utilizes foreign capital under the control of the government. Apparently, these practices stem from the nation's domestic conditions. It is generally acknowledged that North Korea's reform measures have achieved initial success. North Korean economy has recorded positive growth for three consecutive years, with its domestic markets and consumption becoming more active and the strain on food and living supplies eased. On the other hand, confrontation between North and South Korea is rumbling on, and the arrangements around the only industrial complex between the two sides, the Kaesong Industrial Region, is constantly encountering conflict, which has made business people skeptical about economic collaboration with North Korea. Especially as North Korea keeps conducting nuclear tests, it remains hard for it to break the sanctions and isolation from the international community. All these factors prove the uncertainty of North Korea's economic reforms. Hence, media and scholars should be reminded to deliver accurate and comprehensive information over North Korea to the world, in order to prevent giving misleading impression or weakening the risk awareness of investors, causing irreparable losses as a result. ^ top ^

 

Mongolia

Minister of Road and Transportation at trilateral meeting (Montsame)
2015-05-29
Our delegation was chaired by Mr N.Tomorkhuu, the Russiane--by M.Yu.Sokolov, the Russian Minister of Transport, the Chinese--by Yang Chuan, the Minister of Transport. Emphasizing that the cooperation among the three countries' Ministries has been boosting fruitfully, the parties affirmed an aspiration to deepen these ties and cooperation and said they attach a great importance to forwarding of the transit capabilities of their countries. They also held talks on developing the corridors of auto-roads and railways and on the trilateral collaboration in renovating current railways, and signed a protocol as the meeting's results. After this, the Mongolian Minister Tomorkhuu met with D.F.Mezentsev, the SCO Secretary-General, to share views on the cooperation in the transport sector, on developing the transport network of Mongolia by connecting it to the SCO network of transport, and on a chance to finance the biggest projects of Mongolia on infrastructure by banking and financial organizations participated by the SCO. Mr Tomorkhuu also attended an opening ceremony of a terminal annex of the airport of Ufa. ^ top ^

President receives credentials from two Ambassadors (Montsame)
2015-05-28
The newly accredited Ambassadors of the Islamic republic of Iran and the Republic of the Union of Myanmar to Mongolia presented letters of cre­dence to the President Ts.Elbegdorj May 26. After this ceremony, the President received the Ambassadors. The Iranian Ambassador Mr Ali Asgar Haji said he is delighted with being appointed to work in Mongolia and that he will put efforts to intensify relations between the two countries. He conveyed to the Mongo­lian leader the greetings of the Presi­dent of Iran Hassan Rouhani. In response, Mr Elbegdorj congratu­lated the Ambassador on his new posi­tion and said his visit to Iran had become an important step to deepen the bilat­eral relations. He also recalled a meet­ing with the Iranian President Rouhani at the Shanghai Cooperation Organiza­tion's Summit held in Bishkek in 2013. He mentioned that certain dialogues have run between the two governments and that some works are being realized fruitfully, and the Ambassador a suc­cess in his mission. The President wished the Ambassa­dor of Myanmar Mr U Thit Linn Ohn a success and said he is glad that the two countries started exchanging high level visits. Recently, the Minister of Foreign Affairs of Myanmar visited Mongolia and discussed with the Mongolian sides all perspectives of the relations, he added. He also said he plans to touch upon many other issues of bilateral relations during a visit of the President of Myan­mar to Mongolia. ^ top ^

President meets Ambassador of Israel (Montsame)
2015-04-28
The leader of Mongolia Ts.Elbegdorj Tuesday received Mr Matan Vilnai, the Ambassador Extraordinary and Plenipotentiary of Israel to Mongolia. The President highly spoke a con­tribution Mr Vilnai made to boosting of the Mongolia-Israel relations and em­phasized that these ties have been de­veloping since the diplomatic relations established in 1991. The parties noted that our coun­tries both have chances to cooperate in health, energy, agriculture, bio-technol­ogy and IT spheres. The President wished Mr Vilnai health and success. The Ambassador was received in connection with a completion of diplo­matic mission. ^ top ^

Australia and UAE want to open embassies here (Montsame)
2015-05-28
Aus­tralia and the United Arab Emirates have expressed their willingness to open their Embassies in Mongolia. During his working visit to the UAE, the Prime Minister of Mongolia Ch.Saikhanbileg signed the treaty on commencing the construction plan of an underground mine of the Oyu Tol­goi project, which positively influenced on Mongolia's reputation, for example, some countries have proposed mutually opening Embassies. After establishment of the treaty, the UAE Vice President and PM Mohammed bin Rashid Al Maktoum expressed a willingness to open the Embassy in Mongolia, after which the two sides con­curred to make a decision on it in near future. Besides the UAE, Australia's Ambas­sador Extraordinary and Plenipotentiary to the Republic of S.Korea Mr William Paterson sent a letter to the Premier of Mongolia, mentioning about a decision of the Australian government expanding its Consulate in Mongolia to the Embas­sy. Mr Paterson also thanked the Mongolian government for signing the con­struction plan of the OT's underground mine, underlining that it has made a basis for the bilateral creative relations. ^ top ^

 

Mrs. Lauranne Macherel
Embassy of Switzerland
 

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