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
  22.2-26.2.2010, No. 308  
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Table of contents

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Foreign Policy

China stresses friendly ties with DPRK as its "consistent policy" (Xinhua)
President Hu Jintao meet with Kim Yong Il, director of the International Affairs Department of the WPK Central Committee in the Great Hall of the People on Feb 23, 2010. President Hu Jintao on Tuesday pledged to push forward China's relations with the Democratic People's Republic of Korea (DPRK), saying cementing friendly ties between the two countries has been a consistent policy of China. "Under the current complicated and changeful international situation, it is in the fundamental interests of the two peoples and also benefits peace, stability and prosperity of the region and the world to further promote friendly exchanges and expand pragmatic cooperation between the two countries," said Hu when meeting with a delegation from the Workers' Party of Korea (WPK) of the DPRK. […]. ^ top ^

China stresses diplomatic solution to Iran nuclear issue (China Daily)
China Tuesday reiterated that the Iranian nuclear issue should be solved through enhanced diplomatic efforts, amid international pressure to push for a fourth round of sanctions against Iran. Foreign Ministry Spokesman Qin Gang addressed the first press briefing in Beijing after the Lunar New Year and said China had taken note of an International Atomic Energy Agency (IAEA) report on the Iran nuclear issue and hopes "the Iranian side continues to cooperate with the IAEA on related issues." In the report the IAEA said it was concerned about possible activity in Iran to develop a nuclear payload for a missile and confirmed that Iran's first batch of 20 percent highly enriched uranium had been produced, adding that the country had failed to give inspectors the required advance notice. "China holds that the parties should continue to step up diplomatic efforts in a bid to maintain and promote the process of dialogue and negotiations," said Qin, "China hopes the parties demonstrate more flexibility and create conditions conducive to a comprehensive and proper solution to the Iran nuclear issue through diplomatic means." […] "China stands firmly on the position of non-nuclear proliferation, and hopes all parties in the Middle East will deliver concrete actions and efforts to rebuild mutual confidence and peace for the region," he said. […]. ^ top ^

'No intention' of capping emissions (China Daily)
China has no intention of capping its greenhouse gas emissions even as authorities are committed to realizing the nation's target to reduce carbon intensity through new policies and measures, the country's top climate change negotiators said yesterday. The negotiators also warned that rich and developing countries have little hope of overcoming key disagreements over how to fight global warming. China "could not and should not" set an upper limit on greenhouse gas emissions at the current phase, said Su Wei, the chief negotiator of China for climate change talks in Copenhagen, at a meeting in Beijing on China's climate change policies in the post-Copenhagen era. Su, who is also director of the department of combating climate change under the National Development and Reform Commission, said that China's greenhouse gas emissions have to grow correspondingly as the country still has a long way to go in improving people's livelihoods and eradicating poverty. The country's carbon dioxide emissions per capita is also relatively low compared to developed countries and China has not contributed much to climate change because of its short history as an industrial nation, he said. However, China will spare no effort to adopt proactive measures to fight the negative effects caused by global warming and achieve the country's ambitious goal of cutting carbon intensity per GDP unit by 40 to 45 percent by 2020, a voluntary target China pledged last November, he said. "The targets for carbon intensity reduction will be included in the 12th and 13th five-year plans (2011-15; 2016-20) as a binding index," he said. The targets remain a very challenging task for China, as its secondary industry comprises a large part of the country's industrial structure, said Ma Zhong, a professor at the Renmin University of China. The secondary industry accounted for 46.8 percent of China's 2009 general domestic income, official statistics showed. […] China will introduce a carbon emissions check system for the steel industry and a fuel efficiency management system for automotive products, as well as initiate demonstration projects in the petrochemical industry, Premier Wen Jiabao said at an executive meeting of the State Council, China's Cabinet, yesterday. […] Many hope a legally binding climate change treaty, which failed to be signed at the Copenhagen conference, will be finalized at a UN meeting in Mexico in December. Yu Qingtai, China's special representative for climate change negotiations, said yesterday that players could face hard times in this year's climate negotiations. […] Yu said China will stick to the principle of "common but differentiated responsibilities" and work together with international communities, though a divergence of views on vital issues will be a long-standing problem. […] A vast majority of developing countries are in the initial or middle stage of industrialization, which is characterized by high carbon intensity, while rich countries have completed industrialization and transferred a large part of manufacturing functions to developing countries, said Qi Ye, a professor of Tsinghua University. […] "Both developed and developing countries are facing heavy costs in efforts of cutting emissions. Developed countries are striving to sustain their vested interests while developing countries are seeking the rights for development," said Pan Jiahua, a senior researcher with the Chinese Academy of Social Sciences. […]. ^ top ^

China denies violating UN sanction on DPRK (Xinhua)
China denied on Thursday that its economic and trade exchanges with the Democratic People's Republic of Korea (DPRK) has violated a United Nations (UN) resolution. At a regular press conference, Chinese Foreign Ministry spokesman Qin Gang was asked to comment on a report by Yonhap news of the Republic of Korea quoted by China Daily saying Pyongyang announced two islets adjacent to China's northernmost port city Dandong would be developed by Chinese enterprises as a free trade area. "This project is purely normal economic and trade contact between the two countries. It does not go against the UN relevant resolution of sanction on the DPRK," he said. The UN Security Council last June adopted a resolution imposing tougher sanctions on the DPRK, including a tighter arms embargo and new financial restrictions, after the DPRK announced a successful nuclear test on May 25, the second since 2006. The resolution also underlined that "measures imposed by this resolution are not intended to have adverse humanitarian consequences for the civilian population of the DPRK.". ^ top ^


Domestic Policy

New policy to encourage China's carmaker consolidation (China Daily)
The Chinese central government plans to implement a new policy in the first half of this year to encourage auto industry consolidation and further the development of Chinese-brand passenger vehicles, an official from the Ministry of Industry and Information Technology said at a recent news conference. According to sources with knowledge of the new policy, it intends that Chinese-brand passenger vehicles will comprise at least half of vehicle sales by 2015 and sedans made by entirely domestic automakers will have about 40 percent of the nation's car market. Statistics from the China Association of Automobile Manufacturers (CAAM) show that 4.58 million Chinese-brand passenger vehicles were sold last year, some 44.3 percent of the total. Sales of domestic sedans hit 2.22 million units, almost 30 percent of the segment. […] There are now more than 130 carmakers across the country, but most of them are small enterprises with annual production and sales of fewer than 10,000 units. […] By 2012 policymakers hope consolidation will result in two to three large-scale auto groups, each with annual production capacity surpassing 2 million units, and four to five companies with annual output of more than 1 million vehicles, according to the national auto industry revitalization plan released in March last year. The current top-four Chinese motor groups are SAIC Motor Corp, FAW Group, Dongfeng Motor and Chang'an Motor. Carmakers including Beijing Automobile, Guangzhou Automobile, Chery, Geely and Sinotruk form the second tier in the country's auto industry. Li Yizhong, minister of Industry and Information Technology, said recently that in addition to fueling industry consolidation, the government will also implement measures to encourage domestic automakers in reaching overseas this year through investment, acquisition of foreign brands, building research and development facilities and developing sales networks. […] Homegrown carmaker Geely's bid for Swedish luxury brand Volvo received a lot of media exposure in 2009. The Zhejiang-based company will reportedly close the deal soon. Beijing Automotive bought some of Swedish carmaker Saab's core assets and technologies for $200 million last year. […] Li also said that the ministry will accelerate the development of new energy vehicles, including hybrid, pure electric and fuel battery models. The new policy will reportedly stipulate that Chinese partners hold at least a 50 percent share in newly built Sino-foreign joint ventures that produce core parts for alternative-energy vehicles. […]. ^ top ^

China boosts auditors' power as stimulus package spending prompts corruption concerns (Xinhua)
China plans to audit all fiscal funds and all government-related construction projects, according to a newly-revised regulation, in a bid to ensure sound use of public money and effective prevention of corruption. The regulation on the implementation of the Audit Law, issued Saturday by the State Council and to take effect on May 1, will help improve the country's auditing system, experts say. It will also boost supervision of areas with high incidences of corruption, such as construction projects. […] The regulation also makes it clear that construction projects whose government investment exceeds 50 percent, or those with less than 50 percent government investment but with construction and operation government controlled, must accept being audited. […] In the last two years, reconstruction funds for regions hit by the 2008 Sichuan earthquake and the 4 trillion yuan stimulus package to combat the global financial crisis have come under close public scrutiny, as both involve a large number of infrastructure and construction projects. […] China's National Audit Office (NAO) said in January 230 million yuan (33.7 million U.S. dollars) of reconstruction funds have been misused. A total of 88 cases involving 198 Party officials misspending stimulus package money have been dealt with one year after its launch, an official with the CCDI said in December. […]. ^ top ^

China's new credit rules put brakes on banks' lending binge (Xinhua)
With Chinese banks' record new lending in 2009 igniting fears about asset bubbles and bad loan, the banking regulator's latest rules aim to bring financial risk under control. The new directives order banks to focus on loan quality control, rather than quantity restriction, and aim to make loans flow to the real economy -- rather than the property and stock markets, which are susceptible to asset bubble formation. […] The China Banking Regulatory Commission (CBRC) issued new regulations on Saturday evening telling banks to set lending quotas after "prudent calculation" of borrowers' "actual demand". It also reiterated working capital should not finance fixed-asset investment and equity stakes. The new rules also ask lenders to give funds directly to the end user declared by the borrower, instead of directly giving it to the debtor, in an effort to ensure loans are used for their declared purpose. […] In support of the government's 4-trillion yuan stimulus package, Chinese banks lent an unprecedented 9.6 trillion yuan in 2009, nearly half of 2009 gross domestic product. […] Wang Kejin, an official with the Supervision Rules and Regulation Department of CBRC, told Xinhua "the current working capital and individual loans exceeded real market demand." […] Ba Shusong, a researcher with the Development Research Center of the State Council, China's cabinet, said the new rules will further strengthen credit risk controls and put a "brake" on lending and keep the financial system in good health. […] Although the CBRC and the nation's central bank have repeatedly warned banks to maintain an even pace in lending growth and to avoid big fluctuations, new yuan loans hit a massive 1.39 trillion yuan in January, as banks scrambled to lend before an expected tightening in credit later in the year. CBRC chairman Liu Mingkang said on Jan. 27 the Chinese government is aiming to restrict credit supply to 7.5 trillion yuan (about 1.1 trillion U.S.dollars) in 2010. […] To soak up the excess liquidity on the heels of lending spree, China has raised the deposit reserve requirement ratio (RRR) twice this year, after holding it steady for over a year, to handle the "comparatively loose liquidity" while keeping the "moderately easy" monetary policy unchanged. […]. ^ top ^

Beijing to maintain stimulus measures, leaders pledge to keep loose monetary policies (SCMP)
Mainland leaders have vowed to continue fiscal stimulus spending and appropriately loose monetary policies this year, and say the economy has not yet fully recovered from the impact of the global financial crisis, state media reported yesterday. President Hu Jintao chaired a meeting of the decision-making Politburo yesterday to review the annual government work report to be delivered at the annual plenum of the National People's Congress, which begins on March 5. The announcement, aimed at setting the tone for this year's economic development, is expected to ease concerns Beijing will announce further tightening. […] "[China] will continue to maintain the continuity and stability [of the policies]," Xinhua reported, citing the Politburo statement. However, the statement also stressed the need to manage the tempo, strength and focus of policy implementation and strike a balance between supporting growth and managing inflationary expectations. It signals that Beijing will not take major steps to unwind the stimulus package soon, although it has tightened bank lending, raising the reserve requirement ratio for major lenders twice this year. […] "The economy has not yet recovered to the desired level and the government still needs to work on the 'three chariots' of our economy - exports, domestic consumption and investment," said Wei Jie, an economics professor at Tsinghua University in Beijing. But monetary and fiscal policies would be tightened slightly to prevent inflation. […] Record loan growth last year was blamed for surges in property and commodity prices, prompting concerns over inflation and asset bubbles. This month the China Banking Regulatory Commission ordered banks to tighten up on personal loans and loans to businesses for working capital. Zhao Xijun, a finance expert at Renmin University, said the central government faced a delicate situation. It had to strike a balance between boosting consumption and preventing inflation. […]. ^ top ^

Crackdown fears as censor slams citizen journalists (SCMP)
The mainland's top press censor says the country's expanding army of citizen journalists - members of the public who report and disseminate news on the internet - are reporting illegally, sparking fears that a crackdown is under way. An article on the General Administration of Press and Publication's website said only accredited reporters from official news organisations were permitted to report news. It said many websites run by ordinary people claiming to be whistle-blowers were making illegal profits by using their reports to blackmail others, including corrupt officials. It also said official press cards issued by the administration would be subject to an annual vetting process. News organisations would be required to submit a "self-inspection" report on the credentials of their journalists before applying for renewal of their press cards. […] Amid the lack of a free press on the mainland, the internet plays an increasingly important role in exposing news that previously would never come to light. […]. ^ top ^

President Hu calls for China to meet emission cut targets (Xinhua)
Chinese President Hu Jintao called for China to step up efforts to tackle climate change so as to ensure the country's carbon dioxide emission cut 2020 targets would be reached. Hu made the call on Monday at a lecture attended by members of the Political Bureau of the Communist Party of China Central Committee. China announced in November last year that it aimed to reduce the intensity of carbon dioxide emissions per unit of GDP in 2020 by 40 to 45 percent compared with 2005 levels. This was a "voluntary action" taken by the Chinese government based on its own national conditions and would have profound and far-reaching significance in ensuring China's economy and society develop in a sound and rapid manner, Hu said. Combating climate change provided an important opportunity for China to speed up the transformation of its economic growth pattern and adjust its economic structure, he said. […] China signed the United Nations Framework Convention on Climate Change and had made noticeable progress after it announced binding targets on the reduction of carbon dioxide emissions per unit of GDP and major pollutants as well as the expansion of forest coverage, he said. He called for more efforts to save energy resources, improve energy efficiency, research and promote environmental-friendly technologies and upgrade the country's capacity to tackle climate change. […] Hu stressed that China would stick to the principle of "common but differentiated responsibilities", shoulder its due responsibilities as a developing country, actively participate in international cooperation on tackling climate change and help other developing nations to improve their capacity to combat climate change. ^ top ^

Ban on tobacco sponsorships coming to legislature by 2011 (China Daily)
Anti-smoking advocates including 17 senior legislators and political consultants are urging that laws be passed to ban donations or sponsorships from tobacco companies for Chinese events, such as expos, festivals and athletic events. The measure is expected to be enacted by the top legislature within a year. "The message will be conveyed to the coming two sessions to fuel the anti-smoking efforts," said Wu Yiqun, deputy director of the Thinktank Research Center for Health Development, a Beijing-based nongovernmental organization, yesterday. The two sessions are the annual plenary meeting of the National People's Congress (NPC) and the National Committee of the Chinese People's Political Consultative Conference (CPPCC), which usually fall in early March. They are considered China's most important annual political events. […] Last July, under pressure from anti-smoking advocacy groups including Thinktank, the 2010 Shanghai World Expo organizers turned down a 200 million yuan ($29 million) donation from a local tobacco company to observe the promise of a "healthy and smoke-free Expo". Last October, organizers of China's National Games returned all sponsorship money from nine tobacco companies, also due to public pressure mainly from the tobacco control office of China's Center for Disease Control (CDC). […] The new laws would also be in line with the World Health Organization's Framework Convention on Tobacco Control (FCTC), which specifies that member countries, including China, are obliged to undertake a comprehensive ban on tobacco advertising, promotion and sponsorship at both domestic and international levels, said Jiang Yuan, deputy director of CDC's tobacco control office. In 2003, China signed the FCTC, promising to ban all types of tobacco advertising and promotion by 2011. China now has 350 million smokers, official statistics show. One million die of smoking-related diseases each year. ^ top ^

East-west gap widening (Global Times)
China will kick off a new western development strategy for the next decade, following an average annual growth rate of 11.6 percent in the past 10 years in the region's 12 provinces, autonomous regions and municipalities. Analysts, however, note that an economy mainly driven by central government investment has led to an expanding gap between the western and eastern regions of the country and vicious competition between some key western cities, and urge more efforts to be made toward enabling the west's ability for self-renewal. The government is set to hold a review meeting on the west's development soon and to launch a package of favorable policies, the February issue of Caijing magazine reported. "The past 10 years have seen the fastest development of the western regions in history, but the absolute gap between the west and the east in China is not narrowing, but widening," Cao Yushu, former deputy director of the Western Development Office of the State Council, China's cabinet, was quoted by the magazine as saying. China launched the "Western Development Strategy" in January 2000 to help underdeveloped western regions catch up with the more prosperous eastern regions. The western regions comprise 12 provinces, autonomous regions and municipalities, with a combined population of about 370 million people and accounting for 71.5 percent of the country's total land area. […] Some researchers have attributed the widening regional gap to unbalanced government investment. Investment in eastern regions stood at 9.64 trillion yuan ($1.4 trillion) in 2008, a 557 percent growth over 1999, while investment in the western areas was 3.59 trillion yuan in 2008, up 663 percent from 1999, a report in Tuesday's Lianhe Zaobao newspaper stated, quoting official statistics from the Sichuan provincial government. The actual gap in investment between the two regions, however, rose to 6.05 trillion yuan in 2008 from 1.19 trillion in 1999, a 508 percent increase, the report said. […] According to Liu, per capita GDP in 2008 in western regions is less than 45.6 percent of that in the eastern regions. Per capita investment was 60 percent, per capita fiscal revenue 43.6 percent, and per capita savings was 45.1 percent of the corresponding figures in the country's eastern regions. Jia Wen, an associate professor at the School of Economics at Sichuan University, argued that a lack of private investment is another reason preventing the west, a "sleeping giant," from waking up. […] Many major cities, including Chongqing, as weel as Chengdu and Xi'an – the capitals of Sichuan and Shaanxi provinces respectively – have engaged in a fratricidal fight to become the central city of the west, launching competition in industries such as information technology (IT), finance and transportation, Lianhe Zaobao reported Wednesday. Competition for a western transportation hub and financial center also exists between Chongqing and Chengdu, two cities just 300 kilometers apart. "Government investment, rather than domestic consumption, has been the most significant contributor to local economic development. In the meantime, there has been a general lack of an effecttive mechanism to hold officials accountable in regard to their decisions on investment approvals," Jia said. According to Cao, limitations on private investment in infrastructure construction will be loosened in the next 10-year strategy, which will insist on favorable fiscal and tax policies and raise funds for environment protection. […]. ^ top ^

Politburo set on carbon emissions target, Party leaders rule out further debate on goal promised at Copenhagen meeting (SCMP)
Communist Party leaders are trying to suppress debate at home about the target it set for reduction of carbon intensity - the amount of greenhouse gas generated per unit of economic growth - as Beijing wants to enter a new round of talks this year with western powers with a unified voice. China promised just before last year's Copenhagen meeting it would cut carbon intensity levels 40 to 45 per cent by 2020 based on 2005 levels. That figure, however, drew criticism at home and abroad. In China, the opponents were divided into two camps, with the liberals saying the target was too low and the conservatives, too high. The liberals echoed the pervasive international opinion that if China did not take more aggressive measures to cut emissions, the global effort to slow down warming would be in vain. The conservatives, most of whom are from the economic and industrial sector, said the target would increase the burden of manufacturers and slow economic growth. The Politburo on Monday held a meeting with Professor Pan Jiahua , a director of the Research Centre for Sustainable Development under the Chinese Academy of Social Sciences (CASS), and Professor Xu Huaqing , a director of the National Development and Reform Commission's Centre for Energy, Environment and Climate Change Research of the Energy Research Institute. Pan is from the conservative camp. He has in numerous public events expressed concerns about the feasibility of the emissions cut target. Xu, a liberal, is known for his pursuit of a low-carbon economy. According to Xinhua, the two researchers' opinions and suggestions prompted a "serious" discussion among the Politburo members. In the end, President Hu Jintao said the 2020 emissions target would stand. "All levels of party committees and government must unify their thinking to the Central Committee's decision ... to ensure that the entire country can reach the emissions cut target," Hu was quoted by Xinhua as saying. A scientist at the National Climate Centre of the Chinese Meteorological Administration said a "thought unification campaign" was held in that agency promptly after the Politburo meeting. He refused to be named as the issue was "politically sensitive". […] To the rest of the world, China is still taking a hard stance, but Su Wei , who led the negotiating team in Copenhagen, said on Wednesday that other countries did not seem to understand that China's economy is still developing. For that reason, he said, China "cannot and should not" set an upper limit on greenhouse gas emissions yet. ^ top ^

Corruption hot topic at session (China Daily)
As China's top legislature, the National People's Congress (NPC), readies for its annual meeting in Beijing early next month, public interest is running high. An online survey by, an influential news portal in China, showed that corruption is the most important issue netizens want the NPC to address. Other issues netizens want the session to tackle are the widening gap between rich and poor, the skyrocketing cost of housing, the country's health system, pensions and education. In another online poll, 70 percent of respondents urged officials to declare their assets and emphasized the role of the Internet in preventing corruption. This is the third consecutive year corruption has been the top issue on the eve of the NPC meeting. The past few months have witnessed an unprecedented crackdown on corrupt government officials. Huang Songyou, former vice president of the Supreme People's Court, received a life sentence in January for embezzlement and taking bribes of 3.9 million yuan ($574,000) in exchange for favorable court rulings. Huang was the first top judicial official convicted on corruption charges. Ten days later, Yu Renlu, former vice chief of the Civil Aviation Administration, was sacked and kicked out of the Chinese Communist Party (CPC) for "serious violations of discipline and law". Yu was found to have used his position to benefit other people in return for "large sums" of bribes, according to a statement jointly issued by the CPC's Central Commission for Discipline Inspection (CCDI) and the Ministry of Supervision. His case has been referred to prosecutors. In February, a key figure in the high-profile mob trials in Southwest China's Chongqing municipality stood trial. Wen Qiang, former deputy police chief and director of the justice bureau in Chongqing, was accused of rape, taking more than 15 million yuan ($2.2 million) in bribes to protect criminal gangs and possessing a large amount of unexplainable assets. The massive eight-month anti-gang crackdown in Chongqing uncovered judicial corruption, with 200 judicial and public security officials implicated, said former Chongqing mayor Wang Hongju. A press briefing by the Ministry of Supervision in early January revealed that in the first 11 months of last year more than 106,600 officials were either punished by the CPC or underwent administrative discipline. The ministry also said 4.44 billion yuan ($653 million) in public money had been recovered. […] According to Gan Yisheng, deputy chief of CCDI, investigations mostly focus on malpractice related to the implementation of major government policies on expanding domestic demand to boost economic growth, as well as food and drug safety, environmental protection, land requisition and house relocation. Bribery and corruption cases related to construction projects, land development and mineral resource exploration that prompted mass protests were also investigated. […] Statistics released by the Ministry of Commerce show that in the past three decades some 4,000 corrupt officials have run off with more than $50 billion of public money to Canada, the United States, Australia, and other countries. ^ top ^

Appliances replacement program effective: MOFCOM (Global Times)
The country's consumption has been effectively boosted by the old-for-new home appliances program, the Ministry of Commerce (MOFCOM) said Thursday. 7.22 million old home appliances had been replaced as of February 20 in 2010. Sales of new home appliances totaled 6.67 million units, with a value of 26.45 billion yuan ($3.87 billion), Yao Jian, spokesman for the MOFCOM, said. The program has given out 2.65 billion yuan ($388.12 million) in subsidies to date, benefiting more than 6 million families. Most of the new home appliances sold were middle- to high-end, with an average price around 4,000 yuan ($585.85) per unit, according to figures from the MOFCOM. The replacement program offers subsidies of up to 10 percent to consumers, and was launched in nine pilot provinces and cities including Beijing and Shanghai in August. Five household items, including TVs, refrigerators, washing machines, air conditioners and computers, are covered in the program. […] Higher subsidies may be on the way, as the State Council stated in December that the upper limit would be raised substantially, and the program will be expanded to more regions that are capable of refurbishing old appliances. The State Council also said Wednesday that the old-for-new program will cover more household items than the current five in the future. ^ top ^



CCTV building fire trials underway (China Daily)
A Beijing court began hearing the first trials yesterday involving alleged wrongdoers connected to the massive blaze that damaged the multi-billion-yuan China Central Television (CCTV) high-rise one year ago. Beijing No 2 Intermediate Court said yesterday it had received a case filed by local prosecutors against 23 suspects charged with causing accidents with dangerous materials. Among them is Xu Wei, former director of the national TV network's new headquarters, who prosecutors said decided to store illegal fireworks and hold the grand display on the building during Spring Festival last year. The move backfired and the fireworks ended up severely damaging the 30-story annex tower. Those charged include six other former CCTV employees and six former employees from the project's construction company. Prosecutors said the suspects organized the illegal firework display, something that was not permitted on the 5-billion-yuan project site. […] Constructors who used flammable building materials for the project and government officials who failed to prevent the CCTV staff from letting off the illegal fireworks are also expected to face trials in the coming days. Mu Ping, chief procuratorate with the Beijing People's Procuratorate, told reporters last month that government officials from the local construction and work safety supervision committees will be charged with neglecting their duties. The State Council, the nation's cabinet, said in a special investigation report that 44 alleged wrongdoers, including government officials, will be prosecuted for various alleged offences connected to the fire, which caused around 163 million yuan in damage. […]. ^ top ^

Beijing looks to stabilize property (Global Times)
Joint guidelines released by 11 local departments to stabilize Beijing's real estate market will have little short-term impact on soaring home prices, analysts said. Increasing affordable housing and the supply of medium-and small-sized commercial residential houses was one of the highlights of the guidelines released late Tuesday by 11 departments including the Beijing Municipal Commission of Housing and Urban-Rural Development. The guidelines stipulate that affordable housing must constitute half of all new residential construction. […] He Tian, an analyst with the China Index Academy, a real estate research institute, said "the newly built housing supply can only satisfy the demand for seven to eight months, and consequently home prices will not decline because it always takes a longer period for the developers to build more houses." […] The developers must disclose all their houses within three days after they are granted sales licenses, the guidelines also say. The rule is aimed at curbing developers who try to stockpile properties to sell them later at a good price, but He said it would be difficult to put into practice because "the home sales chain is too complex to supervise." The basic rules for foreigners' buying houses that were promulgated in 2007 and halted in 2009 will come into effect again, the guidelines said. The rules state that foreigners can only sell a property in China if their employer pulls out of the country, and an individual is allowed to buy only one apartment. The goal is to curb the foreign hot money driving up housing prices, "But I'm not sure that this measure will be really effective without very strict supervision," Tian Chenhong, a manager of the Benchmark Property Company, said. […] Yi Xianrong, an expert at the Chinese Academy of Social Sciences, said there was nothing new in the guidelines compared with the 11 measures to cool the property market released at the end of last year. "Tightening the credit for developers is the only way to suppress the soaring home price," he said. The China Banking Regulatory Commission (CBRC) released an announcement barring all the real estate trust companies from offering loans for land purchasing, the Shanghai Securities News reported Wednesday, quoting unnamed sources with the CBRC. Getting loans from real estate trust companies is an important financing channel for the developers. […]. ^ top ^

'Hired thugs' held over attack on arts centre (SCMP)
Beijing police have detained 18 people for attacking a handful of artists to evict them from an art zone to make way for a property development. Xinhua yesterday quoted police as saying that the suspects had been detained for allegedly breaking into three artists' workshops and intentionally injuring the occupants. Artists at the Zhengyang Creative Art Zone said about 100 hired thugs descended on their community on the outskirts of Beijing in the early hours of Monday, wielding knives and iron rods. They beat several artists who confronted them and also smashed their cameras and mobile phones. Six artists were sent to hospital with injuries. Artist Liu Yi and Japanese artist Satoshi Iwama received several stitches for head injuries. The Beijing Times reported that the attackers were hired by two bosses of a property developer, who were among those detained. Hours after the attack, on Monday afternoon, about 20 artists marched on Chang'an Avenue - Beijing's main thoroughfare - holding banners and shouting slogans decrying the use of force to tear down their community. They were prevented from reaching Tiananmen Square by dozens of police cars but no one was arrested. It was a rare protest on the normally heavily guarded avenue. Outspoken artist Ai Weiwei, who watched the protest, said the artists' action had led to the arrests and a victory against the developers. They were consoled by the fact that police had taken swift action to arrest the assailants. On the day of the protest, he said he had expected police to detain the protesting artists. "The government has not overreacted; it defused the situation by seriously dealing with the thugs," Ai said. "They responded to the artists' fight for justice ... the outcome [of the protest] was beyond our expectation." […] Despite their victory, the fate of the art zone remains unclear. The artists said their leases had not run out but that property developers had been trying to evict them since last year. […]. ^ top ^



Shanghai goes all out in bid to promote expo (SCMP)
[…] On water and land, in homes and in schools, the propaganda machine in the mainland's largest city has unleashed an unprecedented campaign to promote World Expo 2010, which starts on May 1 and aims to attract up to 100 million visitors. China is trumpeting the expo as a bookend to the Olympics - twin showcases of the country's growing global clout. But observers say the event is a key moment for Shanghai's leaders, who stand to gain influence on the national stage if the mammoth six-month exhibition is a success. […] "I can't think of any time where a city has gone all out on the publicity front," said Tom Doctoroff, the head of China operations for advertising firm JWT. "It clearly suggests that the event is important to the power structure." The campaign is aimed at keeping residents and officials upbeat about the expo, and to spread the message that this is an event on a par with the Olympics in terms of importance and prestige, Doctoroff said. "You are seeing an old [propaganda] reflex, multiplied by 10," he said. […] "The ultimate goal of the expo is not only to boost the local economy but to promote Shanghai, and China as a whole," said Chen Xinkang, the head of an expo research institute at Shanghai University of Finance and Economics. […]. ^ top ^

Activist stranded in airport for three months files suit (SCMP)
A prominent Shanghai rights activist is suing immigration authorities for repeatedly refusing to allow him to return to the mainland over an eight-month period. Feng Zhenghu - who finally made it home on February 12 after being stranded in Japan since June - said he filed a formal complaint at the Pudong New Area People's Court on Monday. He said he wanted to use his experience - which included sleeping in an airport for three months - to demonstrate that citizens had the fundamental right to return home. "I want to confirm that the immigration authorities were acting illegally," he said. "Everyone knows this was not lawful, but it needs to be tested in court. Once that has been established, it won't happen again." Feng said his case was being handled by high-profile human rights lawyer Mo Shaoping , who began preparing it in November. […] When his Japanese work visa expired in November, Feng was left in diplomatic limbo and spent 92 days camped out on benches in the departure lounge at Narita. That period - during which he survived on food packages given to him by generous travellers - brought his situation to the media's attention. "I had my own personal interview booth. […] Feng was ultimately allowed home when, after months of lobbying, staff at the Chinese embassy in Tokyo agreed to present his case to Beijing just days before the Lunar New Year. Before his ordeal, the Charter 08 signatory was already well known among Shanghai political petitioners for assisting residents in protesting against forced evictions to make way for World Expo construction projects. However, his constant blogging and Twitter updates throughout his stay at the airport brought him cult-hero status among the mainland's fast-growing and mostly young online community. ^ top ^



Labor shortage puts squeeze on Delta (China Daily)
Companies in the Pearl River Delta region, one of the world's largest manufacturing bases, are facing a serious shortage of migrant workers after the Spring Festival. […] In Dongguan, some 150,000 extra workers are needed after the Spring Festival, according to Huang Huiping, an official with the Dongguan labor and social security bureau. Sources with the bureau said there were two jobs in the city for every worker in December. The processing industries are facing up to 80 percent job vacancies, Huang said. "It is because many factories have opened more production lines following increased overseas orders," Huang said. Zhongshan, a Pearl River Delta city and a center of home appliance manufacturing, is also facing a shortage of 130,000 workers after the festival, said Zhang Yousheng, assistant general manager of Gaowei Electrics Group. […] Li Jing, an expert with the Chinese Academy of Social Sciences, attributed the shortage of workers in the Delta region to lower pay. "Companies in the central and western regions are offering the same salaries as the Delta region," Li was quoted as saying by China Radio International. "Migrant workers have more job choices in central and western regions, boosted by the central government's 4-trillion-yuan ($590 billion) stimulus plan last year to prop up infrastructure construction. The massive construction of roads, airports and railways attracts a large number of laborers," Li said. […]. ^ top ^



Beijing warming to 'growing rational discussion' of reform (SCMP)
The central government's liaison office has praised what it sees as the increasingly rational discussion of electoral reform, and has pledged to convey Hongkongers' views to Beijing. A pro-democracy coalition, which is seeking dialogue with the central government on reform, sees the remark as a positive sign. Peng Qinghua, director of the liaison office, said yesterday: "I have noticed that rational voices discussing the issue of constitutional reform have been growing stronger recently. In the public consultation, most citizens have expressed their wish for the political system to move forward. "The central government fully understands what Hong Kong citizens think. As the central government's representative body in Hong Kong, the liaison office will comprehensively and objectively reflect the opinions and demands from Hong Kong." […] In a meeting with the Alliance for Universal Suffrage earlier this month Chief Secretary Henry Tang Ying-yen agreed to convey the alliance's request for talks to the central government. […] Meanwhile, the League of Social Democrats and the Civic Party are pushing forward their "de facto referendum" movement. Following the resignations of five geographical constituency lawmakers from the two groups, by-elections would be held on May 16, the Electoral Affairs Commission said yesterday. […]. ^ top ^

Reserves to keep ballooning as surplus tipped to hit HK$20b (SCMP)
The government is likely to record a budget surplus of HK$20 billion this financial year, up from the estimated HK$13.83 billion announced in the budget speech. This compares with an earlier government forecast of a HK$40 billion deficit and will increase reserves to more than HK$510 billion, enough to cover almost two years of government spending. The relatively strong performance during the unprecedented global downturn was mainly due to increased revenue from stamp duty and land premiums. Critics accused Financial Secretary John Tsang Chun-wah of hoarding cash when many households faced layoffs and businesses were struggling. […] Tsang said that while he would use the reserves to prop up the economy in down times, the need to support an ageing population and a shrinking labour force meant he "must act with prudence and replenish our reserves as and when appropriate". David O'Rear, chief economist at the Hong Kong General Chamber of Commerce, said "there is room for returning a reasonable portion to taxpayers". […] The economy contracted 2.7 per cent last year after expanding 2.6 per cent in the fourth quarter. It is forecast to grow 4 per cent to 5 per cent this year, partly because of a low base of comparison. Without the stimulus measures introduced to boost the economy, gross domestic product would have shrunk 4.7 per cent last year. It will grow between 2.7 per cent and 3.7 per cent this year, according to government estimates. ^ top ^



Taiwan's ageing air force needs help, says US (SCMP)
Taiwan's fighter jets would fall short in combat against the mainland, the US government said in a report yesterday that could lead to new weapons sales sure to anger Beijing. Many of Taiwan's roughly 400 combat aircraft would not work in action due to age and maintenance problems, while protection of the island's airfields little more than 160 kilometrs from the mainland was a major issue, the US Defence Intelligence Agency said in the report, released in Taiwan. The one-off report, ordered by Congress, says upgrades are needed as Beijing gets stronger. The United States is Taiwan's top arms supplier but also wants to improve its ties with Beijing. Beijing reacted angrily last month after President Barack Obama's administration unveiled its first arms package for self-ruled Taiwan, which Beijing claims as its own, saying it would impose unspecified sanctions on the companies involved. Another jolt in Sino-US relations could shake markets in Asia further after their bout of nerves over the reaction to last month's US$6.4 billion US weapons proposal. […] Taiwan is seeking 66 new US-made F-16 fighter jets. But Washington, wary of another Beijing backlash, has hedged on the request, saying officials must evaluate Taiwan's overall defence needs. […] The US switched diplomatic recognition from Taipei to Beijing in 1979, recognising "one China". But it remains Taiwan's biggest ally and is obliged by the 1979 Taiwan Relations Act to help the island defend itself. ^ top ^

Taiwan raises economic growth rate forecast amid optimistic export prospect (Xinhua)
Taiwan's statistics authority on Monday raised its 2010 economic growth rate forecast from 4.39 percent to 4.72 percent as analysts predicted the island's high-tech exports would increase amid the global economic recovery. Analysts from Taiwan's statistics authority said the island's export of new high-tech products such as electronic books, LEC TV, touch-screen, cloud computing and 3D products were estimated to grow by about 21 percent this year. […] Yuan Ho-ling, director of the Graduate Institute of National Policy and Public Affairs with Taiwan's National Chung Hsing University, said the economy's growing strength was due to improving cross-Strait relations and the expansion of cross-Strait trade. The memorandum of understanding (MOU) by the financial regulatory authorities between the Chinese mainland and Taiwan, which has already taken effect, and the Economic Cooperation Framework Agreement (ECFA), which has yet to be signed, were factors stimulating Taiwan's economic growth, Yuan said. […]. ^ top ^



Bumper spending for new year 'golden week' (SCMP)
Tourism during the Lunar New Year "golden week" holiday pumped more than 64.6 billion yuan (HK$73.4 billion) into the mainland economy, state media reported yesterday. Travel spending during the holiday period increased by almost 27 per cent compared with last year's, according to figures from the National Tourism Administration. A total of 125 million sightseers went on outings last week - also up 14.8 per cent on last year - but three-quarters were day trips. Slightly fewer than 30 million actually spent the night in hotels at their destinations. Of the total travel spending, domestic airlines took in 4.6 billion yuan and a further 2.8 billion yuan was spent on rail tickets over the period. The Year of the Tiger "golden week" was also a bumper shopping festival, partly due to it coinciding with Valentine's Day. […] The figures echoed national statistics released on Friday which showed total consumer spending over the week added up to 340 billion yuan, an increase of 17.6 per cent. […]. ^ top ^

China expects 8% export growth in 2010: minister (Xinhua)
China's exports may grow by 8 percent in 2010 but problems still existed with getting exports back to pre-crisis levels, according to a statement posted Monday on the website of Ministry of Industry and Information Technology (MIIT), quoting minister Li Yizhong. It was unlikely for China's exports to recover to pre-crisis levels in the short-term, Li said during a Sunday meeting attended by MIIT officials, attributing the slow rebound to rising international protectionism and the fact that Chinese manufacturers relied too much on overseas markets. The 8-percent growth forecast was still far below 2008's 17.2-percent increase, according to customs data. Despite overtaking Germany as the world's largest exporter, China saw its exports contract 16 percent year-on-year in 2009 as overseas demand slumped. Exports in January this year grew 21 percent on lower comparison bases a year ago due to the global economic downturn and less working days as the Lunar New Year holiday fell in January last year, said the General Administration of Customs earlier this month. […]. ^ top ^

Yuan hits new high against US dollar (China Daily)
The yuan strengthened the most against the greenback yesterday on speculation that the government may allow more flexibility in the currency exchange rate, even as analysts cautioned on risks from increased "hot money" flows. The yuan gained 0.1 percent to 6.8264 per dollar in Shanghai, the biggest gain since February 2009, according to the China Foreign Exchange Trade System. That's the third fluctuation of 0.05 percent or more in four trading days. […] "It is an obvious signal that the People's Bank of China (PBOC) may allow the yuan to appreciate in the first half of this year," said Zhou Mingjian, an analyst with Pacific Securities. China's foreign exchange reserves rose to nearly $2.4 trillion by the end of last year. At the same time, speculative capital also flowed into the country through various channels. The "hot money" flows are expected to further surge this year on the back of the strong economic recovery and expectations of yuan appreciation, said a recent from the Chinese Academy of Sciences. […] Yi Gang, head of State Administration of Foreign Exchange and vice governor of the PBOC, said the government's attempt to control asset bubbles and maintain healthy economic development this year faces threats from increased foreign exchange inflows. He said the near-zero interest rates of central banks in Western economies, such as the US, have stoked cross-border speculative flows. […]. ^ top ^

China's CPI to rise moderately in 2010: official (China Daily)
China's consumer price index (CPI), a main gauge of inflation, would probably only increase moderately in 2010, an official with China's National Bureau of Statistics (NBS) said here on Monday. Although China's CPI continued to climb in previous months, it was not likely to surge this year as supplies were abundant, Wei Guixiang, head of the Department of Urban Social and Economic Survey of the NBS, said Monday during an exclusive interview with, a website run by Xinhua. China's CPI rose 1.5 percent year-on-year in January, mainly boosted by food price increases due to the cold winter weather. […] Official figures revealed that housing prices in China's 70 large and medium-sized cities rose 9.5 percent in January 2010 from a year earlier, and were up 1.3 percent compared to the previous month. ^ top ^

State firms post strong rebound in earnings as the economy recovers (SCMP)
State-owned enterprises on the mainland have staged a strong profit rebound, with earnings doubling to 74.33 billion yuan (HK$84.5 billion) by January from a year earlier, powered by the country's economic recovery. […] Official statistics released yesterday showed state firms had revenue totalling 1.16 trillion as of January, up 67.8 per cent from a year earlier. Meanwhile, their profit rose to 74.33 billion yuan, 49.61 billion yuan more than the same month last year. Yet the figures were down 23.1 per cent and 14.5 per cent month on month, respectively. One of the reasons for the robust growth was the Lunar New Year - one of China's longest public holidays - which fell in January last year but in February this year, Bank of America-Merrill Lynch economist Lu Ting said. "People simply stopped working for a whole week or even more to celebrate the festival. That's why there's a huge gap between total revenue in the two months," he said. […] Yi Xianrong, a researcher at the Chinese Academy of Social Sciences, a top think tank of the central government, said among all the industries, the vehicle, energy and telecommunications sectors were probably the main drivers of revenue growth last month. China overtook the United States as the world's biggest car market in early 2009 due in large part to Beijing's stimulus measures, including aggressive tax incentives for purchases of small cars. Energy and telecommunications, both monopolised by state-owned enterprises, have also benefited from government policies to boost domestic consumption since last year. […] Casting doubt on the state firms' prospects is Wei Jie, an economics professor at Tsinghua University in Beijing. Wei said many state companies in different sectors had long been investing in property, an important source of income for them. "Yet they will find it hard to maintain those good earnings this year as the central government is determined to stabilise property prices and curb speculation," he said. ^ top ^

Chinese ministries highlight currency stability (Global Times)
With external pressure growing for the yuan to appreciate, some government departments have been emphasizing that stability in the exchange rate should be maintained. The yuan should be firmly kept at the current exchange rate, which could help allay the potential impact brought by international capital movements engaging in arbitrage, said an article posted by the National Bureau of Statistics on its website Tuesday. Li Yizhong, Industry and Information Technology Minister, expressed a similar view Sunday. Li said though China's exports are expected to increase by 8 percent this year, compared with last year's drop of 16 percent, they are not likely to recover to a pre-crisis level. Maintaining a stable yuan at a reasonable and balanced level not only benefits China, but is good for the world economy, Zhong Shan, vice Minister of Commerce, said earlier this month. Though the departments are not directly involved in the making of exchange rate policies, which are mainly under the authority of the central bank, their viewpoints are believed to have an influence on exchange rate policies.The statements came as pressure for the yuan's appreciation has been growing. The global economy continues to see signs of recovery, and speculation on a one-off appreciation of the yuan has resumed in the market. […] The international pressure on the yuan's appreciation is mostly attributed to the country's better economic fundamentals, strong recovery during the economic crisis and good economic prospects, and huge foreign exchange reserves, Wang Tao, head of China Economic Research at UBS Securities, told the Global Times. Wang believes a one-time revaluation is not likely, reflecting the government's standpoints. […] The belief that through a one-time revaluation the speculation on the yuan's further appreciation would end is not realistic, said Tan Yaling, head of the China Forex Investment Research Institute. Wang believes the yuan will gradually appreciate 5-6 percent against the dollar this year. ^ top ^

Overseas direct investment may soar (China Daily)
China's overseas direct investment (ODI) may see a double-digit growth this year to around $60 billion, on the back of government support and overseas expansion plans of domestic firms, officials from the Ministry of Commerce (MOFCOM) said yesterday. Though foreign direct investment slumped worldwide in 2009, China's ODI in the non-financial sectors rose 6.5 percent from a year earlier to $43.3 billion. The growth momentum will be "sustained" this year, and would be even "more stronger", Liu Zuozhang, director general of the Investment Promotion Agency of MOFCOM, told China Daily. […] During the first half of 2009, China's ODI slumped nearly 52 percent as the world economy was still in limbo and domestic enterprises shied away from investment. However, things started to change in the third quarter of last year after ODI rebounded nearly 190 percent year-on-year to $20.5 billion. This was fueled largely by the economic recovery in the United States and European Union and accelerated gross domestic product growth in China. […] According to the United Nations Conference on Trade and Development (UNCTAD), global foreign direct investment dropped 39 percent to around $1 trillion in 2009, against a high of $1.97 trillion in 2007. China is one of the few countries that increased investments during the financial crisis. Most of the overseas investment projects were resource-oriented and backed by the Chinese government. "This year, the government will continue its measures to help domestic companies spread their wings abroad along with better policies and services," said Wang Chao, assistant to the minister of commerce. "Overseas direct investment will accelerate this year," said Zhang Xiaoji, director of the Foreign Economic Relations Department of the Development Research Center under the State Council. […] By the end of 2009, China had foreign exchange reserves of $2.4 trillion, accounting for 30.7 percent of the world total. Analysts are of the opinion that it is risky for China to hold such huge levels of forex while global economic prospects remain uncertain. "A good way to reduce the risk would be if some of the forex reserves are used to help Chinese companies go overseas," said Zhang. […]. ^ top ^

Pressure on yuan rise 'not justified' (China Daily)
China's trade surplus has shrunk significantly in recent months, so calls by other countries to let the renminbi appreciate are not justified, the Ministry of Commerce said Thursday. The surplus will continue to diminish in the next few months, the ministry said; and therefore, growing pressure from the United States for China to revalue its currency is becoming "more and more groundless". "The trade surplus will continue to ease this year, and we cannot rule out the possibility of China recording a trade deficit within the next few months" as the Chinese government "focuses on rolling out measures to stimulate imports this year", said ministry spokesperson Yao Jian. Exports "cannot reach pre-crisis levels for two to three years", and therefore, a stable Chinese currency will not only help Chinese exporters "hold on to their competitive edge", but also "benefit the stability of the global economy". Trade surplus growth was in negative territory for most of last year; and the trade surplus with the United States fell to $77.4 billion last year from $170.9 billion in 2008, according to Customs figures. Exports this year will probably grow by "over 13 percent" from a year earlier and the government will make it a priority to "maintain the stability of the renminbi" at least during the first half of this year, Yao said. During the past two months, year-on-year growth of Chinese imports far outperformed exports. Last year, China's trade surplus decreased 30 percent. China's exports have rebounded since December, which has provided ammunition for other countries led by the US to seek a revaluation of the renminbi. US President Barack Obama recently raised the issue when he complained that the "undervalued currency" put US companies at a disadvantageous position. Western economists argue that the renminbi is undervalued by 25 to 40 percent, and predict that Beijing would let the currency rise. But most Chinese economists oppose it, believing revaluation should not happen soon. "The yuan is not likely to appreciate in the next six months, and it is not likely to appreciate until the dollar starts to stabilize," said Dong Xian'an chief economist from Industrial Securities. The renminbi/dollar exchange rate has been largely unchanged since July 2008 but the real exchange rate has been rising during the past month. "I don't think there is any necessity for renminbi appreciation for a year, given the rising real exchange rate," said Zhu Baoliang, deputy director-general of the economic forecasting department of the State Information Center. […] The US should focus beyond trade, such as in investment, and stop complaining about the currency, said Yao. More than 60,000 American companies have a presence in China, which creates "annual sales of $150 billion", double the figure of US exports to China, Yao said. ^ top ^

China defends move cutting US Treasury securities holdings (China Daily)
China defended its move to reduce its holdings of US Treasury securities, saying the United States should take steps to promote confidence in US dollar. Foreign Ministry spokesman Qin Gang made the comment Thursday when responding to questions on China's sale of US Treasury securities last December. Qin said the issue should be viewed from two perspectives. He said on the one hand, China always followed the principle of "ensuring safety, liquidity and good value" in managing its foreign exchange reserve. And when it came to how much and when China buys the bonds, the decision should be made taking into account the market and China's need, so as to realize rational deployment of China's foreign exchange property, he said. And on the other hand, the United States should take concrete steps to beef up the international market's confidence in the US dollar, Qin said. […] China trimmed its holdings of US debt by $34.2 billion in December 2009, leaving Japan the largest holder of US Treasury securities, the US Treasury Department reported on Feb 16. As of the end of November last year, China held $789.6 billion of US Treasury bonds. ^ top ^


Gautier Chiarini
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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