China, Pakistan vow to consolidate strategic, cooperative partnership
2007-04-02 Xinhuanet
Islamabad - China and Pakistan will work to further consolidate good neighborly friendship and strengthen the strategic and cooperative partnership between the two countries, officials said here Sunday. Chinese Foreign Minister Li Zhaoxing and his Pakistani counterpart Khurshid Mahmood Kasuri were addressing a joint press conference following the talks held between them Sunday afternoon. At the invitation of Kasuri, Li embarked upon a two-day official visit to Pakistan on April 1-2. […] To a question, Li said the fundamental objective of China's policy towards South Asia is the stability and development and good neighbourhood and cooperation. He expressed the hope that all countries in South Asia will enjoy political stability, economic prosperity and harmony for common development, adding that China is committed to develop long term and stable good neighborly and friendly cooperation with South Asian countries. […] Kasuri expressed appreciation for China's support on several economic projects of "great national significance", including the newly inaugurated Gwadar Port. He said the joint five-year program for trade and economic cooperation, and free trade agreement already signed between Pakistan and China will strengthen significantly the economic relations between the two countries. Kasuri said Pakistan welcomes China's entry into SAARC (South Asian Association for Regional Cooperation) as an Observer, which has elevated the profile of the organization. […]

China puts forward five proposals for cooperation with SAARC
2007-04-04 People's Daily Online
China has put forward five proposals for cooperation with the South Asian Association for Regional Cooperation (SAARC), Chinese Foreign Minister Li Zhaoxing announced Tuesday. […] China's proposals include discussing with SAARC about establishing a cooperation mechanism for poverty alleviation and carrying out comparative study on models of poverty alleviation, exploring with SAARC the possibility of establishing a China-SAARC regular meeting mechanism for cooperation on disaster relief and mitigation to share experience and information. China will invite SAARC countries to attend multilateral human resources training programs organized by China, and will consider hosting bilateral training programs for SAARC countries. It will encourage Chinese enterprises to make investment in SAARC countries and develop infrastructure and energy sectors in cooperation with SAARC countries on the basis of equality and mutual benefit. China will also invite a delegation of senior South Asian diplomats to visit China this year and plan to host a seminar on China-SAARC relations. During the two-day summit hosted by India in New Delhi, eight SAARC countries will discuss major peace and development issues including anti-terrorism, poverty alleviation and intra-regional free trade. SAARC, comprising of Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan, and Sri Lanka, was established in 1985. It is the first time in the SAARC history for China, the European Union, Japan, South Korea, and the United States to attend the summit as observers.

China, Sudan vow to boost military exchanges
2007-04-02 Xinhuanet
China and Sudan vowed here Monday to boost military exchanges and cooperation in various sectors. "Military relations between China and Sudan have developed smoothly," said Chinese Defense Minister Cao Gangchuan at a meeting with Chief of Joint Staff of Sudanese armed forces Haj Ahmed El Gaili. China and Sudan have enjoyed profound friendship though the two countries are far apart, said Cao, who is also vice chairman of the Chinese Central Military Commission and state councilor. […]Haj Ahmed El Gaili, who arrived in Beijing on Sunday, was paying an eight-day visit to China, invited by Chief of the General Staff of the People's Liberation Army (PLA) Liang Guanglie. He and his party will also visit eastern Chinese cities of Nanjing and Shanghai.

Mainland urges Sudan to negotiate on Darfur
2007-04-04 SCMP
China has offered Sudan increased military co-operation, but also nudged the African nation towards a compromise on the crisis in Darfur, where hundreds of thousands of people are believed to have died. Western powers have sought to pressure Sudan into accepting UN peacekeepers to quell violence in its western province, where government-backed militia forces have been fighting rebels. African Union forces have failed to stop massacres. China, which buys much of Sudan's oil and wields veto power over UN resolutions, has rejected UN forces without Khartoum's agreement. Defence Minister Cao Gangchuan courted Sudan's visiting joint chief of staff, Ahmed el-Gaili. General Cao told him that Beijing wanted to extend military co-operation, Xinhua reported. "Military relations between China and Sudan have been developing smoothly for a long time," General Cao said. China was "willing to further develop co-operation between the two militaries in every sphere". China raised the issue of Darfur and had urged Sudan to show more flexibility in considering a peace proposal put forward by former UN secretary-general Kofi Annan.

China, Japan to ink joint document during Premier Wen's upcoming visit
2007-04-05 People's Daily Online
China and Japan will issue a joint document during Chinese Premier's visit next week, Premier Wen Jiabao said on Wednesday. "The joint document will spell out the two countries' aspiration to build a strategic and mutually beneficial relationship, and the meaning and major tasks of this relationship," Wen said while giving an interview to 16 Japanese news organizations. "This is a significant event, ushering in a new era of China-Japan relations," Wen said in the interview, which came ahead of his Japan tour slated for April 11-13. […] He also called for the two countries to abide by three political documents which review the past and chart the future of China-Japan ties. The three political documents -- the Sino-Japanese Joint Statement, the Peace and Friendship Treaty and the Sino-Japanese Joint Declaration -- are the cornerstones of stable China-Japan relations, Wen said. […]Wen's visit is the first to Japan by a Chinese premier in seven years, according to the Chinese Foreign Ministry.

Nation strengthens maritime patrols
2007-03-31 China Daily
China established a regular patrol system in the East China Sea last year, an official report said. The annual report, reviewing the State Oceanographic Bureau's administrative enforcement of the law in the past year, said the bureau had sent ocean surveillance ships and airplanes on patrols in the East China Sea. The vessels and planes watched and turned back foreign vessels that were not authorized to explore for oil and gas in the continental shelf of the East China Sea, and those that disrupted China's natural gas exploration activities inside its offshore area instead of the disputed area. The monitoring team also ordered several military surveillance ships from the United States to stop unauthorized ocean surveys in the sea area last year. "The regular patrol system in the East China Sea demonstrates the Chinese government's determination and capacity to administer the East China Sea. It also safeguards China's maritime rights," said the report, which was signed by Sun Zhihui, the bureau director The East China Sea covers an area of more than 700,000 square kilometers, with the east side reaching Japan. The average water depth is 350 meters. It is estimated that about 7.2 billion tons of gas and oil resources are buried in the East China Sea. The sea is abundant with scarce metals such as cobalt, manganese and nickel, which can be used to manufacture aerospace equipment and precision machine tools. In addition to the regular patrol system, the bureau strengthened inspections of sea use last year and carried out more than 45,000 checks, the report said. The bureau has cracked down on 3,100 illegal activities, and issued fines of 107 million yuan ($13.8 million). More than 80 percent of the illegal sea use cases were projects reclaiming land from the sea and fishing. […]

Beijing looks to expand party's ruling bodies - Central Committee, Politburo could be doubled with injection of young blood
2007-04-02 SCMP
The mainland leadership is considering expanding the Communist Party's powerful Central Committee and Politburo to increase representation and help find solutions to one of the party's potentially most destabilising issues - leadership succession, according to sources. The 356-member Central Committee and 25-member Politburo could be doubled in size at the 17th party congress, when the party representatives will meet to elect members of the Central Committee, Politburo and the nine-member Politburo Standing Committee for a new term of five years, the sources said. If the proposals are adopted, they would pave the way for the leadership to boost the so-called "democracy within the party" - by allowing competitive elections for important party positions at the 17th congress and top leadership positions at the 18th congress in 2012. The central government leadership is intensifying preparations for the five-yearly party congress, which is expected to be held shortly after the October 1 National Day holidays. Congress delegates will elect members of the Central Committee, who in turn will select the members of the Politburo from which the Standing Committee and party chief are chosen. The meeting is crucial for President Hu Jintao as he is widely expected to receive his second and last five-year term as head of the party, and thus the country. Mr Hu is expected to boost his power by promoting his supporters to the party's governing bodies - the Central Committee, Politburo and Politburo Standing Committee - as well as sidelining or retiring the supporters of his predecessor, former president Jiang Zemin. The new leadership line-up to be unveiled at the 17th congress will most likely include the so-called fifth generation of leaders to take over power at the party's 18th congress in 2012, when Mr Hu and the rest of the fourth-generation leaders will retire. Overseas analysts believe Mr Hu has set his heart on Li Keqiang, the party boss of Liaoning as his anointed successor, with many expecting Mr Li to be elected to the Politburo - and even its Standing Committee - at the 17th congress. But sources said the leadership was under increasing pressure to enlarge the pool of candidates for future leaders by expanding the Central Committee and Politburo to include more capable, younger officials. Many party officials had argued that the Central Committee, which has a full membership of 198 and alternate membership of 158, was too small to represent nearly 70 million party members and should be at least doubled, the sources said. The Politburo, which has 24 members plus one alternate member, should be similarly expanded. "Mao Zedong and Deng Xiaoping had the power and authority to choose their successors but the strongman's era is over," one source said. "Mr Hu will not have that kind of power to choose his successor when he retires in 2012." The succession has sometimes proven problematical even under a leader with absolute power. Mao anointed three successors in his lifetime - Liu Shaoqi, Lin Biao and Hua Guofeng, but none was successful. Liu was tortured to death during the Cultural Revolution; Lin died in a plane crash while fleeing to the former Soviet Union and Hua was toppled by Deng. Deng chose Jiang as leader of the third generation and anointed Mr Hu as fourth generation leader

No more money-for-coverage
2007-04-04 Xinhuanet
China's press watchdog on Tuesday issued a circular banning reporters in the provinces from taking kickbacks or extorting money in return for favourable news coverage. […] It also bans paid news, forced subscriptions and forced advertising in return for complimentary reports. Local media branches should lose no time in carrying out the overhaul, dismissing unqualified press personnel and applying for a journalist's certificate for those who are qualified but do not have a certificate yet, GAPP said in the circular. The press watchdog also ordered subordinate departments to tighten supervision over the operation of media branches in the provinces. Local GAPP departments have been told to revoke the licenses of media branches which violate the ban or ignore the press watchdog's overhaul orders. "Local media branches are subject to the local GAPP department's guidance, supervision and administration," GAPP said in the circular, asking its local offices to annually review the performances of media branches. The circular comes after a series of cases in which local newspaper reporters extorted money in exchange for not reporting bad news or accidents. Wang Wei, a media professor with the Communication University of China, said it is high time to purify the journalistic profession in China as paid news is prevalent in some parts of the country. "Journalism is a divine profession, which must not be tarnished by cynicism and greed," Wang told Xinhua, adding that stricter qualifications should be imposed to ensure journalists qualified both professionally and ethically. GAPP also said government officials cannot be hired as part-time reporters and that all reporters must carry a "journalist certificate" that is issued by GAPP. The circular said GAPP will revoke reporters' certificates if they violate any of the rules. In January, Lan Chengzhang, an employee of the Shanxi office of the Beijing-based China Trade News, was beaten to death during his investigation of an unlicensed coal mine in the northern province, by eight thugs hired by the coal mine owner. Lan and his colleague, who were apparently not fully-fledged journalists, were allegedly trying to extort money from the owner of the illegal coal mine. Last May, four newspaper staff reporters previously working for local branches of the Beijing-based China Food Quality Newspaper and three other newspapers were arrested for extortion. The four reporters racketeered institutions or companies after learning about irregularities there. Some media branches were set up without official approval.

Blogging brings gift of free thought to China's long-controlled masses
2007-04-02 SCMP
In spring 2002, when Isaac Mao Xianghui, a Shanghai-based software engineer for US chipmaker Intel, first came across internet blogs, he was struck by the freedom of expression the online journals offered ordinary citizens. With a fellow blogger from a remote part of Fujian province, he set up CNBlog.org, China's first online discussion forum about blogging technology. […] The internet on the mainland is tightly controlled by the government. But blogs offer a means of dodging the censors, allowing more freedom of expression and, ultimately, freedom of thought. […] The power of blogs was demonstrated recently by the international coverage that was given to Wu Ping, whose public defiance has temporarily spared her home from demolition by developers in Chongqing. Photographs of Ms Wu's house balanced precariously on a mound in the midst of a construction site were circulated worldwide after appearing in mainland blogs. Bloggers evade the censors by posting their comments on websites then linking the site to many other blogs and webpages, allowing them to form a social network. […] Grass-roots communication is increasing rapidly on the mainland, where the population of bloggers has surged to 20.8 million, the largest cyber community in the world, according to state media. There were only 1,000 bloggers in the country in 2002, Mr Mao said. He said blogging had transformed community links, allowing urban bloggers to team up with surfers in rural areas and international users to develop new technologies to get around censorship. […] Mr Mao also encourages Web users to translate Chinese blogs into English. "It has become valuable in helping the world learn about China and vice versa, instead of just relying on traditional media," he said. "Our intention is to generate more social interaction and sharing." He said the new media also helped dissolve misunderstandings between citizens of the mainland and Taiwan. […] But as the number of bloggers increases, the censors are becoming more stringent. Last year, the government announced it would require mainland bloggers to register with authorities under their real names to prevent people anonymously disseminating "irresponsible and untrue" information. Mr Mao, however, believes it is too late for the authorities to take control, with tech-savvy online users outsmarting them all the way. […] Mainland bloggers do face stiffer challenges from unexpected quarters, however - international internet portals like Google and Yahoo. As these companies seek access to the lucrative mainland market, they are increasingly prepared to do Beijing's bidding in the censorship wars. Both use filtering technology to prevent users accessing information on issues considered politically sensitive by Beijing. […] Mr Mao believes the biggest barrier to free thinking is self-censorship - the traditional Chinese education system that makes people reluctant to express their opinions. They are too used to being controlled, he said.

1.8 million fake discs seized in piracy raid
2007-04-04 China Daily
Chinese police seized nearly 2 million fake CDs and DVDs when they raided a factory in the country's largest crackdown on entertainment industry pirates, the official Xinhua agency said on Tuesday. The high-tech operation could use 30 machines spread over 11 warehouses to churn out over 300,000 fake discs in one night, Xinhua quoted a top anti-piracy official as saying. The factory was situated in Guangzhou, capital of southeastern Guangdong province, near Hong Kong. Li Baozhong, deputy head of the national office tackling pornography and illegal publications, said the factory was located along the Guangzhou airport expressway for easy transportation. "This case revealed new tricks by the pirates. The criminals erase the production ID code on the discs in order to destroy evidence showing who provided the original discs," Li added. Police arrested 13 people, Xinhua added. The U.S. undersecretary of commerce for intellectual property, Jon Dudas, last week said China appeared to be losing the battle against an army of increasingly sophisticated counterfeiters despite an increased drive to combat piracy. But China last week urged patience from the developed world as it seeks to stop infringements of patents, copyright and other intellectual property.

Foreigners asked to copyright violation trials for first time
2007-04-05 SCMP
Beijing will for the first time invite representatives of foreign governments and international organisations to attend intellectual property rights (IPR) trials in the country, Xinhua reported yesterday. Jiang Zengwei, head of the national IPR protection office and also Deputy Minister of Commerce, said the open trial system for IPR violation cases would take effect this year to increase the transparency of the trials and strengthen IPR protection. He said people's congress members, political consultative conference delegates, experts and academics were also on the invitation list.

China's illiteracy rate shoots up
2007-04-02 China Daily
The number of people in China who can't read has shot up to 116 million, wiping out years of hard-won gains against illiteracy as rural poor leave the farm and school for work in the city, state media said Monday. Over the last five years, China's illiterate population grew by 30 million. According to census data, 87 million adults in China were illiterate in 2000. Literacy in China is defined as someone who can read and write 1,500 Chinese characters a fraction of the 7,000 to 10,000 characters required for college graduates. Most Chinese were illiterate at the beginning of the 20th century, but the simplification of Chinese characters and education campaigns helped steadily raise literacy levels among adults, hitting about 90 percent in 2000, according to the United Nations. An education ministry official said the main reason for the backsliding was that many young rural poor were dropping out of school in order to find work in the cities. Migrant workers in China's urban centers do not have access to public education, health care and other basic social services. […]Gao said another reason for the backsliding was a lack of adequate funding, and the fact that earlier successes in fighting illiteracy lead some local governments to abandon their literacy programs. China's illiterate population in 2000 accounted for 11.3 percent of the world's total, but reached 15.01 percent in 2005.

Officials plan to crack down on Guangdong's thriving blood trade
2007-04-05 SCMP
Guangdong's health department has said it would come down heavily on organised gangs selling blood and shut them for good in the northeast of the province. "We will crack down on them. The country does not allow sale of blood," said health department spokesman Feng Shaomin, after a local newspaper reported that 500 to 600 `professional' blood donors were operating in Jieyang, Chaozhou, Shanwei, Heyuan and Meizhou . Information Daily said the donors, who mostly live in two urban villages in Jieyang, were organised into two groups controlled by gang leaders from Jiangxi and Anhui and some sold blood as often as every other day and have been doing so for up to 16 years. Illegal blood sale is rampant in northeastern Guangdong where authorities often condone the practice to fill blood banks which are unable to meet hospitals' demand with donations from superstitious local residents who believe they lose their life force when they give blood. A Beijing-based expert in blood safety issues said that he was not surprised that there were still paid donors even though the central government has outlawed blood sales and was cracking down on the practice. […] Donated blood accounted for only 72.65 per cent of the 5.25 million cubic centimetres used by hospitals last year. "We need to have 200 to 300 donors a day to meet demand and we don't have that many," he said. But he denied buying blood saying they only gave donors "transportation fees". Mr He said the blood collected was safe as the screening process was very stringent. Another official said that after preliminary screening for Hepatitis B, the rejection rate at the second screening was only 3 to 4 per cent. Only one case of HIV had been discovered in 2004 and reported to the provincial government. The expert said Aids was not common in Guangdong and there was only a 1:2,000 to 3,000 chance of finding HIV in donated blood but it has a higher Hepatitis B occurrence, at a ratio of 1:10 to 15. […] He said when paid donors were used, safety procedures were often skipped. The news report said paid donors get 200 yuan for 400cc of blood donated in Jieyang and get to keep all of the money whereas they were paid 290 yuan in Longquan in Heyuan but had to pay their minders 170 yuan. The donors, previously known as blood cows, pay 320 yuan a month to the gang for food and housing and are fed well on fish, meat and vegetable twice a day. They are issued several fake IDs each to enable them to sell blood frequently. The trade reportedly began in Shaoguan and moved to Maoming, Huizhou, Guangzhou and Zhaoqing before coming up in Jieyang. The gang leaders make up to 40,000 yuan a month.

Norwegian move paves way for trade ties
2007-04-05 China Daily
In his latest visit to China, Norwegian Prime Minister Jens Stoltenberg represented his country not just as its leader, but as its publicist. While he was here, Stoltenberg took the first step toward a free trade agreement (FTA) with China. The two countries signed a memorandum of understanding last week granting China market economy status and the two sides agreed to launch a feasibility study on FTA as soon as possible. China is not recognized as a full market economy by other countries as it joined the World Trade Organization in 2001, so it must negotiate for this status. Norway is the 69th nation in the world to give China market economy status and the second to do so in Europe after Iceland. Officials and academics said the move would benefit both countries. China's Ministry of Commerce said in a statement that the nation was highly appreciative of the Norwegian government's move and believed it would create a better environment to strengthen bilateral economic and trade relations. "It (Norway granting market economy status to China) is very good news," said Fan Ying, a professor at the Foreign Affairs College. After reaching a consensus with dozens of developing countries, China is striving to make more breakthroughs with developed countries. An influential nation in northern Europe, Norway is expected to set a precedent for other European countries.

China-Vietnam economic co-op zone to boost bilateral trades 2007-04-03 Xinhuanet
China and Vietnam are accelerating the construction of an economic cooperation zone in the two countries' bordering area, aiming at promoting bilateral trades and the development of China-ASEAN Free Trade Area (CAFTA). The zone comprises a logistics park and a processing park, in which commodities made in China and Vietnam will enjoy the privilege of zero tariffs and no import linkage tax, said sources with Pingxiang city government Wednesday. With the completion of the project's first phase, four enterprises have started operation in the processing park, and the second phase is now under construction, said a spokesman of the management committee of the zone. The zone, initiated in 2004, at Pingxiang city, south China's Guangxi Zhuang Autonomous Region and the bordering Lang Son province of Vietnam, covers an area of 13.4 square kilometers in Guangxi and a combined 1.17 billion yuan invested by the Chinese part. The project has also been listed in the aid program of United Nations Development Program (UNDP), which promised to invest 1.5 million U.S. dollars in the zone and plans to set up an office to facilitate its management. China has been the largest trade partner of Vietnam for two years in a row. In 2006, the trade volume between China and Vietnam totalled 9.95 billion dollars, 21 percent up on the previous year and the bilateral trades are expected to hit 15 billion dollars by 2010.

Chinese firm wins bid for building largest hydropower station in Nigeria
2007-04-03 Xinhuanet
China Gezhouba Group Corporation (CGGC), the main constructor of the Three Gorges project, has won a contract to build the 2600 Megawatt (Mw) Mambilla plateau hydropower station in Nigeria, the group announced on Monday. The 1.46 billion U.S. dollar project is the largest hydroelectric power station Chinese companies have ever built in Africa, according to the group, which is based in Yichang city of central China's Hubei Province. "The group has the world's advanced dam building and river closure technology. Despite environmental challenges in Africa and a complex geological structure, we are confident we can build a Nigerian 'Three Gorges' that will benefit the African people," said CGGC President Yang Jixue. Yang met visiting Nigerian President Olusegun Obasanjo in 2005 and introduced his company. Obasanjo wrote on his business card: Welcome to Nigeria, the Mambilla Station is waiting for you, Yang said. The dam is being designed and construction is expected to last six years and nine months, according to the Nigerian federal government. The Mambilla station is part of Nigeria's National Integrated Power Plants (NIPP). The Nigerian government has pumped 2.5 billion U.S. dollars into the NIPP project to strengthen power transmission infrastructure and the distribution network. The Chinese government agreed to build the hydroelectric powerstation after China and Nigeria signed big deals at the Beijing Summit of the second China-Africa Forum in 2006.

China strongly dissatisfied on US trade sanction
2007-03-31 China Daily
The Chinese government expresses strong dissatisfaction about the U.S. decision to impose penalty tariffs against the imports of Chinese coated free sheet paper, Wang Xinpei, spokesman for China's Ministry of Commerce, said early Saturday. The Department of Commerce of the United States on Friday announced its preliminary decision to apply U.S. anti-subsidy law to the imports of coated free sheet paper from China. "This action of the U.S. side goes against the consensus reached by the leaders of both countries to resolve differences through dialogue," Wang said. "China strongly requires the U.S. side to reconsider the decision and make prompt changes," the spokesman said, adding China will closely watch the development of the issue and protect its own legitimate rights. In 1984 the United States set the policy of not applying anti-subsidy law to "non-market economies". Such a practice had been taken as a judicial precedent and had not been changed, Wang said. The preliminary decision of the U.S. Commerce Department made a bad instance and it obviously does not conform with the current judicial precedent of U.S. courts and the consistent practice of the U.S. Commerce Department, the spokesman said. While regarding China as a non-market economy, the U.S. ignored the strong protests from China and decided to apply its anti-subsidy law against China. […] The U.S. Department of Commerce on Friday announced its preliminary decision to apply U.S. anti-subsidy law to imports from China. The decision alters a 23-year old bipartisan policy of not applying the countervailing duty (CVD) law to China, which the U.S. government regarded as a "non-market economy", said the Department of Commerce in a statement, adding the change reflects China's economic development. "China's economy has developed to the point that we can add another trade remedy tool, such as the countervailing duty law. The China of today is not the China of years ago," said Commerce Secretary Carlos M. Gutierrez. The U.S. government also claimed that Chinese producers and exporters of coated free sheet paper received countervailable subsidies ranging from 10.90 to 20.35 percent. From 2005 to 2006, imports of coated free sheet paper products from China increased approximately by 177 percent in volume, and were valued at an estimated at 224 million dollars in 2006.

NASDAQ to launch China Index
2007-04-05 China Daily
The Nasdaq Stock Market Inc will introduce the NASDAQ China Index in the second quarter of the year to track the performance of Chinese companies listed in the United States. Initially, the index will comprise 30 such companies, which have a combined market capitalization of more than $600 billion and are listed on NASDAQ, the New York Stock Exchange (NYSE) or the American Stock Exchange. "It will be a key benchmark to track the performance of innovative companies that have stimulated China's rapidly growing economy," NASDAQ President and CEO Bob Greifeld said in Beijing yesterday after opening the New York-based electronic exchange from China for the first time by ringing a ceremonial bell on Monday night.

Aussie Foreign Minister Arrives in Town
2007-04-05 UB Post
Caught between Russia and China, Mongolia relies on a "third neighbor" policy, engaging with the US, Japan, South Korea, the EU and Australia to counter the gravitational pull of the giants on its borders. Mongolia is especially wary of domination by resource- hungry China, on which Mongolia is dependent for access to ports. Yesterday, Foreign Minister Alexander Downer touched down in Ulaanbaatar, the first Australian foreign minister in 14 years to do so and only the second of its kind (Gareth Evans visited in 1993). His arrival signals Canberra's desire to lend support through his talks with bilateral counterparts and Australian business representatives in Mongolia. "My first visit to Mongolia will promote Australia's growing economic interests there, which are supported by close people-to-people relations. I will raise Australia's role in Mongolia's economic development and the potential for further involvement, particularly in the mining sector, and learn more of Mongolia's economic and political development," said Downer, prior to his departure to Ulaanbaatar. […]. A senior Western diplomat says the real fear for Canberra is if China - the world's biggest commodities customer - gets control of Mongolia's resources at cheap prices. "That would really lead to distortions in the world market, especially for Australia," the diplomat cautioned. "The roots of democracy [in Mongolia] are shallow and the resources issue could blow that apart." He harks back to the new mining laws implemented last year in what many saw as a reaction against the free-wheeling 1997 minerals law which resulted in thousands of exploratory licenses issued covering a third of the country. Mongolia's Vice- Minister for Industry and Trade, Y. Sodbaatar, denies that and rejects suggestions that the government is slow in reaching a new overarching deal. […].We are not interested in slowing the process - we need the jobs, so we are in a hurry as well because this will cause our economy to boom but the right decisions are crucial." As a mining expert, Dr. S. Oyun, sister of the murdered Zorig, has a more complex take on the intricacies surrounding Mongolia's resources. She thinks the 1997 minerals law was a decent attempt at developing these, but says 'resource populism' or 'resource nationalism' has got a grip and the public, from a perceived fear that they were being exploited, pressured the government into overreacting. "We are now at the crossroads," she says. "Either we go along the better road where both investors are happy and the country benefits as well or vested interests may prevail. Civil society is not yet deep enough but it is deepening and democracy is relatively deep-rooted - with all the flaws and problems that involves." A senior Western mining executive says with such a small population, politics and business are bound tightly together, creating a corruption factor, but the problem for publicly listed mining companies is that their competition is often a private or state-owned enterprise - Russian or Chinese, for example - that are 'untouchable', with no shareholders to answer to. But "when you look at the neighbors and the political systems in place there you can argue that Mongolia is a democratic beacon in a part of the world where it is not so common. „That's one of the reasons why the country is getting a lot of support from the US, Japan, South Korea, and the EU. So when you put all of that together, the potential of Mongolia depends on how well the government can manage these pressures."

Women participate in politics
2007-04-04 Mongol Messenger
An important provision in the revised election law states that: No less than 30 percent of candidates for parliamentary election will be women. It is an affirmative action to increase women's participation in politics and the provision will be implemented from the 2008 parliamentary election. Achieving the revised law will not be so easy. Political parties will nominate female candidates in line with the law however, voters, have yet to see an atmosphere that accepts women in politics and this is the first challenge to change social views. Mass media has an important role to overcome this challenge. The National Human Rights Commission and UNDP's project to support Women Rights have organised training: ‘Womens' participation in politics and mass media' on March 21, involving journalists of daily newspapers, radios and television. The NHRC considers gender to be an unsolved issue in the Mongolian human rights sector. NHRC member, J. Dashdorj said that positive changes arising from this issue have become a popular talking point in society and the appointment of a woman as NHRC chief had provided a good model. Gender expert T. Undarya made analyze on current situation and she said, “There is backward, non-democratic and gender discrimination attitude, that considers women unnecessary and unable to participate in politics and women, who aspire to enter politics, are not real women, they like career, reputation, power and are unethical, they forget their duty and they feel they must be legendary heroines if they want to participate in politics with the same status to - it's very common in society. It is a big disappointment that media supports and strengthens it.” She believes that women should try to break down the misunderstanding while they protect their rights to participate in politics equally with men. The National Gender Equity Committee drew up tactics to create a correct image of female politicians, to select women and accept public support to increase women's participation in politics. NGEC's office chief, Ts. Tsogzolmaa said, “There are many educated and capable women in Mongolia. They do not make efforts and aspire to become politicians because entering politics is harder for them than men. It is important to lead them into politics. Making selections from women, who want to be nominated, are publicly accepted will be successful.” The committee will carry out surveys among the public, analyse and identify women who can be supported. It will create images and present the women known through mass media. The committee plans to recruit experts of Scandinavian countries for this direction and also talk to political parties to nominate only women from one election constituency for competition.

One stop shops accelerate government services
2007-04-04 Mongol Messenger
The establishment of a ‘one stop shop' model for the delivery of government services has been adopted by government and will reduce bribery by citizens who used devious means to overcome bureaucratic red tap in accessing these services. This is the rationale behind the model according to Deputy Minister of Industry and Trade, Ya Sodbaatar. He said: ‘The cumber- some delivery of public services in Mongolia at all levels, including the number of steps involved, provides a fertile breeding ground for corruption. To receive a license, people have to visit a number of different offices for various stamps, signatures and approvals. This bureaucratic red tape causes considerable inconvenience to citizens and businesses, provoking them to resort to bribery to receive the required service.' He said: “The creation of a ‘one stop shop' - one door for many services - is expected to increase access to public services for citizens and businesses; reduce the red tape, create transparency; accelerate the delivery of services and reduce corruption.” The NGO, the human security policy studies center, with funding from the Swiss agency for development and cooperation, has been working on the project since October 2006 and will open the first one stop shop in Ulaanbaatar's biggest district, Sukhbaatar, by September. The human security policy studies center introduced the project at a meeting March 29 where they discussed the Vietnamese experience and the importance of the project to Mongolia and associated implementation difficulties. The idea of introducing the one stop shop concept throughout government, evolved at the end of 1999 following the opening of a one stop shop service in the Foreign Investment, Foreign Trade Agency. The Ministry of Industry and Trade studied the concept and concluded it was possible to bring some services together under a single roof including: licensing; different kinds of insurance; citizen registration and information; specialised inspections and customs and taxation. The Ministry issued a brochure to business people with a list of all licenses and permits required to launch a business and placed ‘version one' on the Open Government website. In the National e-Mongolia program framework, a ‘Single electronic window for foreign trade' service was launched and a system to issue special licences electronically was developed. In 2002 the Government adopted the resolution to introduce the one stop shop concept, nationwide. However, deputy minister Ya Sodbaatar cautioned: “Unfortunately past efforts to establish a one stop shop and improve the delivery of public services have not produced the expected result. There are grounds to suggest it failed because there was no effective mechanism to carry out the job. It is essential to create a favourable legal environment to introduce the concept, but first it is necessary to carefully analyze current distribution of power among ministries; aimags; capital city municipalities; soums and districts and take comprehensive measures to decentralize and distribute power more horizontally”. A major obstacle in establishing one stop shops is excessive centralization of power as in the case of issuing licences. There are 51 organizations engaged in issuing 301 different licenses and the vast majority of them are handed out at the level of ministries and government agencies, including 153 licenses by government and 11 ministries. In January 2007, the Government adopted a resolution to create a national committee to coordinate establishing one stop shops. A working group was formed to develop policy drafts and a long-term master plan. The Government is expected to submit its suggestions and proposals on ways to improve the one stop shop legal environment to Parliament before the end of the spring session. Prime Minister, M.Enkhbold sent a message to the meeting noting, “The establishment of one stop shops should be seen as a nationwide initiative. Therefore proper coordination of activities with other donor countries working in the same field, such as USAID and the GTZ as well as international and national organizations, is another important factor which will contribute to the success of the project”. USAID is supporting the implementation of the single Electronic window for the foreign trade project and GTZ expressed its support to establish a one stop shop in Darkhan-Uul aimag.

Clarify Your Stance to Increase Investment, Government Told
2007-04-05 UB Post
The main barrier in doing business in Mongolia is the government's uncertainty on some mining concepts and legislation, and a lack of skilled human resources, according to a panel discussion at the investors' Conference held last week. The Mongolia Investment Forum was held at the Metropolitan Club in New York City on March 28. Over 150 delegates from foreign and Mongolian business communities, as well as government representatives, have taken part in discussing investment opportunities, and trends in the mining, infrastructure, banking, and tourism sectors. On the one hand, foreign investors on mining delivered messages to Mongolian policymakers that swift changes in mining legislations have made investors withdraw their capital investment in the country. However, they remain optimistic about the country's growth. Entree Gold has drawn-down their investment by around 50 percent since 2002. The Western Prospector Group withdrew over US$3 billion capital outlay from the country after the windfall profits tax was adopted hastily last year. On the other hand, the government representatives sent out messages on how the government is implementing the necessary reforms to allow Mongolia to capitalize on its advantages and attract foreign capital flows into the country. Mongolia achieved economic growth rates of 6.2 percent in 2005 and 7.5 percent in 2006. The country has significant mineral resources including gold, copper, coal, uranium and oil. Over 10 percent of Mongolia's GDP is generated through mining and 65 percent of the country's exports are mining-related. […] There are 15 strategically significant mineral deposits, where government participation is indefinite. It is also unclear whether the state ownership concept would be implemented before or after the parliamentary election of 2008, said John Brock, President and CEO of the Western Prospector Group. The mineral law of 1997 was good law. However, it needed changes. The government approved a windfall profits tax law with no prior consultation with the investors. Also, increasing the royalties tax means windfall tax under another name, said Kenneth MacDonald, Director of Erdene Gold Inc. Another barrier in trading with Mongolia is surface transportation links. Most of the cargo traffic is carried by the railway. Mongolia's railway gauge is different from Chinese railway system, which has a standard gauge of 1,435mmwhile it is 1,524 mm in Mongolia. Each carriage has to be lifted in turn to have its bogies changed. We are looking principally at four sectors of the Mongolian economy. The first one is upgrading the railway. It would cost US$129 million to upgrade and increase the capacity of the railway system. It's considered to be a key constraint of the Mongolian economic growth, said James Hallmark, Millennium Challenge Corporation's Country Director for Mongolia. .[…] We are looking to conclude a compact agreement later this year, said Hallmark. Mongolia submitted an official proposal to the MCC in October 2005 and proposed US$322 million over a five- year period. Most of the funding is to be spent on transportation, mainly the railway system while other sectors benefiting will be community development, health and education. The leftover will be for administrative costs. Most of the speakers at the conference gave outlooks that Mongolia is a good place to invest; it has several attractive advantages, including stable economic growth; sharing a border with two giant neighbours; and a high literacy rate. Don't forget that Mongolia is a highly literate country backed by the former Soviet-era education system, said Peter Morrow, CEO of Khaan Bank of Mongolia. Mongolia is one of the most highly literate of all countries, with 99 percent of the population literate. But employers still lack distinguished, technically skilled workers. Mining is not the only potential for Mongolia, said Randolph Koppa, CEO of The Trade and Development Bank of Mongolia. There is a great demand for housing in the next two to three years. The government has the 40,000 Housing Program, which may attract the investment of construction companies, said Koppa. […] The government has been actively encouraging foreign investment and assistance in the construction sector; as a result, a number of projects and programs have been implemented and many are well under way in their implementation. As of today, four projects are being implemented with foreign direct investment. […] Another big investment opportunity talked of at the conference was about exporting energy to neighbouring energy-hungry China. The windy southern province in Gobi, which shares a border with China on the south, is a good place to build wind power stations and export the energy to China. We started a project in Omnogobi aimag, which is also rich in coal reserves. We should export energy to China rather than coal, said Alan Fontaine, CEO of Newcom Group.

Mirjam Mueller
Embassy of Switzerland