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
  20-26.10.2012, No. 446  
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Table of contents

DPRK and South Korea


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Bilateral Issues

Switzerland's ABB to boost China presence (China Daily)
The cooling economic expansion and rising labor costs in China have driven a number of foreign manufacturers out of the country, but Swiss engineering group ABB Ltd said it will stay and plans to attract more Chinese talent. "We did not come to China to make use of its low labor costs 20 years ago," Claudio Facchin, president of ABB North Asia and China, said in a recent interview. "And despite the economic slowdown in the country in the short term, there is a consolidated view for a strong market in the long run," he said. But not everyone is as optimistic. According to a survey recently conducted by the Boston Consulting Group, of 106 senior managers at American manufacturing companies with annual sales revenues exceeding $100 million, more than one-third said they are considering or planning to move their production facilities in China back to the United States. And 48 percent of companies with annual sales revenues over $1 billion plan to return to the US. One of the main reasons for the companies' withdrawal is that the manufacturing-cost gap between the US and a dozen low-cost countries, such as China, has narrowed since last year, according to a report by global consulting firm Alix Partners. It's the first time that the gap has decreased since 2007, the firm said, adding that a number of countries, including Vietnam, Russia and India, now have lower outsourcing costs than China. A series of other factors, including the appreciation of the Chinese currency and rising raw material costs, are also driving foreign manufacturers away, the firm said. [...] This suggests that China "may have lost some of its competitiveness in some areas of the manufacturing sector", Soren Skou, CEO of Maersk Line - the world's largest container operator in terms of volume - said in a recent interview. He said he also noticed a clear trend indicating that "Chinese companies are trying to move up the value chain to produce more expensive goods" in sectors including solar energy, automobiles and aviation. ABB is a good example. The company currently has a full range of business activities in China, including research and development, manufacturing, sales and services, and an extensive sales and service network covering 80 cities, with a total of 18,300 employees in 36 local companies across the country. "ABB China is now at the fourth stage of its development, which means that it does not only serve the local market, but that its products can also be sold in our other markets across the world," said Facchin. [...] While the country may have lost some of its advantages when it comes to low-cost labor, it has "definitely" achieved progress in its R&D capabilities, Facchin added. [...] "We will invest more on people's development, mobility and local leadership development, and hope to attract more talent, adding 25 percent more employees in the next three to five years," Facchin said. [...]. ^ top ^

Mainland has less time for exports of Swiss watches (China Daily)
The Chinese mainland led the decline in Swiss watch exports last month, with a 27.5 percent year-on-year decrease, reflecting the slowdown in economic growth, according to the Federation of the Swiss Watch Industry. Figures from the federation show watch exports from the nation fell for the first time in the past three years by 2.7 percent year-on-year to 1.73 billion Swiss francs ($1.86 billion). Watch exports to Hong Kong dropped by 19.9 percent in September compared with the same period last year. Some Swiss watch manufacturers have also noticed the market risk in China. A "certain weakening" in the high-end segment in parts of China is a negative trend for the future, Swatch Group Ltd, a Swiss manufacturer owning 19 brands, said in its half-year report released in July. [...] In July, the Chinese government banned government officials from using public funds to buy luxury items. Some business insiders said the ban will change the rapid development of China's luxury watch market. "The ban will definitely have an adverse effect on luxury watch sales," said Sun Xuguang, operations manager for Sparkle Roll Group Ltd, a Hong Kong-listed luxury dealer in several Swiss independent watch brands, including Parmigiani and DeWitt. [...] However, Sun said a change in consumer patterns - rather than a fall in sales - would be the more obvious result of the government's ban. "Business owners, rather than government officials, will be the main consumer group for luxury watches in the future, which will be better for the sustained development of the luxury industry," he said. But the Swiss watch industry federation said the decline will not be a cause for concern, following sales increases for more than 30 months. [...]. ^ top ^


Foreign Policy

China opens two more ports to promote cross-Strait shipping (Xinhua)
Two new ports have been opened on the Chinese mainland for direct shipping links between the mainland and Taiwan. The two ports, opened by the Ministry of Transport, are Yantai Port in east China's Shandong Province and Shenzhen Port in south China's Guangdong Province. They are among 72 ports on the mainland, and 85 ports on the two sides of the Taiwan Strait for cross-Strait direct shipping. The ministry published a circular on Friday vowing to promote cross-Strait sea transport. In addition to the new ports, the ministry also urged more cross-Strait cooperation in marine salvage. The two sides of the Strait will establish a communication mechanism for relevant information. The China Maritime Search and Rescue Center on the mainland and the Taiwan-based Chinese Search and Rescue Association have been designated as liaison organizations. The ministry also called for efforts to strengthen the administrative supervision of the cross-Strait shipping market by cracking down on illegal and unqualified operations. It also wants measures to maintain the market order in the cross-Strait container service, such as a freight fare registration system to protect fair competition. [...] As of the end of June this year, the cargo volume of marine transport between the two sides reached 220 million tonnes and the container shipment volume was about six million Twenty-foot Equivalent Units (TEUs). The number of cross-Strait passengers reached 5.5 million. ^ top ^

China airline drops free ticket offer to Japan after outcry (SCMP)
Chinese budget carrier Spring Airlines has cancelled an offer of free tickets to Japan, bowing to pressure after bloggers slammed the company online and labelled it a traitor, in a sign of heightened nationalist sentiment amid a territorial dispute. The country's largest private low-cost carrier withdrew the offer of free round-trip tickets between Shanghai's Pudong airport and Japan's Saga prefecture, a rural area in southern Japan near the city of Fukuoka, just 2-1/2 days after it was launched. “We cancelled the offer last night after taking into consideration the feeling of netizens,” airline spokesman Zhang Wuan told Reuters. The promotion, which would have seen customers pay just tax and surcharges totalling about 1,030 yuan ($160), aimed to boost demand after a dispute over islands in the East China Sea cut Spring Airlines' passenger volume by half on some of its Japan routes. One blogger accused the airline of being a traitor, hurting the feelings of Chinese and damaging the country's image. “Chinese nationals should boycott Spring Airlines,” the blogger said. [...]. ^ top ^

China shows off naval strength with major maritime exercise (SCMP)
A helicopter practises a rescue yesterday as Chinese warships took part in high-profile maritime drills in the East China Sea to assert Beijing's readiness to use military force to back civilian patrol ships in disputed waters. The joint naval exercise, which involved 11 vessels from the People's Liberation Army's East Sea Fleet, the fisheries administration and the marine surveillance agency, was seen by analysts as an effort by Beijing to assert its strength while assuaging domestic criticism that it was being too soft on Japan. A statement posted on the Defence Ministry's website said the exercise was aimed at improving co-ordination between naval and civilian patrol vessels and sharpening their response in missions to safeguard China's territorial sovereignty and maritime interests. Eight aircraft, including fighter jets, were involved, as well as more than 1,000 military and civilian personnel, Xinhua said. Although the exact composition of the flotilla was unclear, state news agencies reported that PLA frigate Zhoushan and hospital ship Peace Ark took part. While the PLA holds such exercises regularly, the unusual amount of attention given to this one by Beijing seemed to suggest it was intended as a direct response to the territorial dispute with Japan over the Diaoyu, or Senkaku, islands. In fact, the Defence Ministry said, the exercises simulated a scenario in which patrol vessels and marine surveillance ships were stalked, harassed and intentionally interfered with by foreign vessels in the East China Sea. The drills come after a series of military exercises between Japanese defence forces and their ally, the United States. Meanwhile, CCTV said seven of the PLA warships that put Japan on alert after passing close to Okinawan islands this week had returned to base in Qingdao. A CCTV reporter on board one of the ships from the PLA's North Sea Fleet said they had navigated to within 30 nautical miles of the Diaoyu Islands. [...] Beijing-based naval expert Li Jie said the relatively large scale of yesterday's drill could be seen as a response to the decision this week by Japanese opposition leader Shinzo Abe - a front runner to be the country's next prime minister - to visit a controversial war shrine. [...] "The drill has taken place at a good time because to some extent it could be seen as a deterrent reaction to the Japanese side's current provocative moves," Li said. [...]. ^ top ^

Drones on patrol protecting coastline (Global Times)
China's plan to use drone aircraft to monitor its coastal regions is moving forward with studies now underway to establish air bases at two coastal cities of Northeast China's Liaoning Province, the Xinhua News Agency reported over the weekend. The Liaoning Provincial Department of Ocean and Fisheries has chosen Dalian and Yingkou for the first airbases for its unmanned aerial vehicles, or UAVs. The UAVs will be used to monitor and track pollution and polluters in areas of the Bohai Sea and the Yellow Sea. The aircraft will also help in the development of marine resources by collecting accurate real-time data along the coast. The State Oceanic Administration announced in August it plans to build bases for UAVs in 11 coastal regions. It is not known how many bases altogether might be built. [...] "Liaoning, located at the center of Northeast Asia and between the two sea areas, plays a key role in marine surveillance," Li Linghua, a researcher at the National Marine Data and Information Service, told the Global Times Sunday. "The province has abundant technology and rich experience in marine management," Li added. [...] "The establishment of the bases can consolidate the supervision of the waters as the unmanned aircraft enlarge the management range and carry out real-time monitoring of the changing situations in the sea," Li added. "The aircraft are at a low cost and are highly helpful in environmental protection and resources exploitation and pollution prevention," Gao Shu, dean of the School of Geographic and Oceanographic Sciences at Nanjing University, told the Global Times. "The oil spill in the Bohai Bay may not have become a disaster, if such monitoring had been established to provide timely data on the scope of the emergency," Gao added. [...]. ^ top ^

Tougher penalties mapped out to fight illegal surveys (China Daily)
Foreigners carrying out illegal surveys, mapping without permission or marking the location of key facilities without authorization, will face tougher penalties amid measures to enhance security of strategic areas. Tackling these activities, and the requisite punishment, is under discussion as authorities draft amendments to the National Surveying and Mapping Law. According to the State Administration of Surveying, Mapping and Geo-information, the amendments have been included in the State Council's work agenda for 2012. Li Weibing, deputy director of legislation and industry management for the administration, said that he hopes the draft will be finished this year and the law will be implemented by 2017. Almost 40 illegal surveying and mapping cases were detected between 2006 and 2011, mostly in border areas such as the Xinjiang Uygur autonomous region, the administration said. "Coordinates, topography and information regarding key areas and core facilities are top secret," Li said. "Once acquired by another country the information could be used to attack targets in wartime." Li said the draft would consider criminal liability in cases where illegal surveys were carried out and endangered Chinese citizens. The current law states that any foreign individual conducting an illegal survey will be deported and face a maximum fine of 500,000 yuan ($78,900). [...] Li Qinggong, deputy secretary-general of the China Council for National Security Policy Studies, said that foreigners, or Chinese people conducting illegal surveys, should face heavy penalties. The State Administration of Surveying, Mapping and Geo-information said most of the foreigners found guilty of carrying out illegal surveys were Japanese or US citizens and border regions were their top targets. From 2005 to 2011, 10 cases of illegal surveying by foreigners, or involving a foreign element, were investigated in Xinjiang, China Network Television, an online broadcaster run by China Central Television, reported in May. [...]. ^ top ^

China, Malaysia pledge further cooperation in law enforcement (Xinhua)
China and Malaysia pledged to further cooperation in law enforcement on Monday, with the senior officials from both countries reaching broad agreement in various issues related to fighting against transnational crimes. Meng Jianzhu, Chinese State Councilor, who was in Malaysia to attend the first working group meeting between the law enforcement agencies, hailed the practical and highly efficient cooperation in law enforcement between the two countries in fighting against terrorism, drugs smuggling, online gambling, telephone fraud and other crimes. Such cooperation has made significant contribution in combating cross-border crimes and maintaining the security and stability of the region, he said. [...] A bilateral agreement on fighting transnational crimes was sighed between the law enforcement agencies in August this year. The holding of first working group meeting within more then two months after the signing of the agreement had highlighted the strong willingness for further cooperation by the two countries, said Meng during his talk with Malaysian Home Minister Hishamuddin Hussein. He also stressed the importance of international cooperation in fighting cross-border crimes. "With rapid development of globalization in the world today, as well as the fast progress of information technology, it is difficult for a country alone to stop the spread of transnational crimes," he said. [...] Meng also met with Malaysian Prime Minister Najib Razak on Monday, and Najib praised the cooperation of law enforcement between Malaysia and China while expressed the willingness to continue such cooperation. ^ top ^

Chinese state councilor visits Vietnam to cement bilateral ties (Xinhua)
Chinese State Councilor Meng Jianzhu arrived in Vietnamese capital Hanoi on Tuesday for a three-day visit to strengthen bilateral ties and promote cooperation in law enforcement between the two countries. "Both China and Vietnam are in a critical stage of national development, the two sides should strengthen solidarity, deepen all-round cooperation and properly handle sensitive issues in bilateral relations, in order to promote the healthy and stable development of China-Vietnam comprehensive strategic cooperative partnership," Meng said while meeting with Vietnamese Prime Minister Nguyen Tan Dung. [...] Meng, concurrently minister of public security, said "during this visit, Vietnamese Minister of Public Security Tran Dai Quang and I reached consensus on the third working group meeting between the law enforcement agencies, during which both sides agreed to further strengthening law enforcement cooperation, to contribute to the stability, development and prosperity of the two countries, as well as the development of the friendly relations between the two countries." Nguyen Tan Dung, for his part, said Vietnam and China are good neighbors and enjoy a traditional and long-standing friendship. Vietnamese party and government will give priority to developing friendly cooperation with China. [...] Dung said Vietnam-China law enforcement cooperation has made positive progress, and plays an active role in the maintenance of the two countries' respective development and stability. The two sides should further consolidate and improve the cooperation mechanism to promote pragmatic and mutually beneficial cooperation in various fields. ^ top ^

Envoys try to ease tension in Diaoyu Islands dispute (SCMP)
Top diplomats from China and Japan met to discuss the territorial dispute over the uninhabited Diaoyu Islands in the East China Sea, Tokyo said yesterday, signalling mutual willingness to ease tension ahead of a key Communist Party congress. Chief Cabinet Secretary Osamu Fujimura confirmed domestic media reports that Japanese Deputy Foreign Minister Chikao Kawai met senior Chinese officials in Shanghai last week to discuss the dispute over the islands, known as the Senkakus in Japan. Kyodo reported earlier that Zhang Zhijun, Kawai's counterpart, attended the meeting. The two countries agreed earlier this month to hold vice-ministerial talks at an unspecified date over the dispute sparked by Japan's purchase of the islands. "This was part of communication at various levels between Japan and China over the current situation," said Fujimura. [...] "Both sides would like to keep the talks [in Shanghai] at a low profile because it is unlikely that there will be any breakthrough," said Professor Lian Degui of the Shanghai Institute for International Studies. But analysts expected lingering tension to ease in the next couple of weeks as neither side wants to complicate the most politically sensitive event in China for years. [...]. ^ top ^

Public angered over Chinese woman's 'forced kowtow' (Global Times)
Pictures showing a Chinese woman who tore up former Cambodian king Norodom Sihanouk's photos being forced by Cambodian police to kneel down in front of the king's portrait have triggered controversy among the Chinese public. Although the Chinese government Tuesday expressed support for Cambodian authorities in holding the woman responsible for breaking local laws, some said making a Chinese citizen kowtow before a foreign king was illegal and too much to bear. According to Xinhua, the woman, surnamed Wang, a production manager at a garment factory in Phnom Penh, used scissors to cut up two portraits of Norodom Sihanouk while workers mourned the former king, who passed away on October 15 in Beijing. After the incident, around 1,000 workers walked to the Royal Palace demanding she be punished. The woman was then handed over to local authorities, media reports said. A local court sentenced Wang to a suspended one-year jail term and fined her $750. She is also facing deportation. Chinese foreign ministry spokesman Hong Lei said on Tuesday that the woman's act was "extremely wrong," and it would be dealt with under Cambodian laws. [...] "At that time, Cambodians were in sadness, and they are sensitive," Nguon Serath, an editor from the Cambodia Herald in Phnom Penh, told the Global Times. "According to Cambodian laws, the king cannot be violated." He also said that foreigners should understand local culture and laws when they are in a foreign country. [...]. ^ top ^

China, ECOWAS move to strengthen ties (Xinhua)
The government of China and authorities of the Economic Community of West African States (ECOWAS) on Wednesday moved to strengthen relations by signing a framework agreement for cooperation in specific areas with a view to enhancing economic cooperation between both sides. The framework agreement was signed in Abuja, Nigeria's capital city, when a high-level delegation of ECOWAS and Chinese officials met on ways to boost trade, investment and technical cooperation between China and the sub-region. [...] ECOWAS is one of the strongest regional blocs implementing great policies and it has been committed to west Africa development. For this reason, it is highly significant for China and ECOWAS to develop certain mechanisms to further deepen cooperation," said Li Jinzao, China's Vice Minister of Commerce who led a delegation of high-level officials from China to the meeting. In the next three years, according to the vice minister, China will establish trans-national cooperation with African countries and the country will provide customs and commodity inspection facilities to enhance trade and commerce in the region, as part of its support. He added that the move will foster investment cooperation. Responding to a proposal by the ECOWAS delegation for the Chinese government to assist the West coast of Africa in completing the construction of a 2000 km trans-west African highway project it has embarked on, the Chinese top official assured that the government of the Asian country will respond to the request in due time. [...] "Our technical staff will carry out further studies and make a focus before we can discuss the work to be done. Also, we need proper understanding between the nine specific countries linked to that highway. They must make agreement before we can begin to discuss the funding. It is a huge financial project and we need African financial institutions to also support it, not only the Chinese. We so much believe in this project and we must continue to be in touch," Li added. Announcing a donation of 200,000 U.S. dollars by the Chinese government to further boost the ECOWAS integration process and to enhance capacity development within the region, the vice minister expressed hope that the partnership between China and the west African bloc will last for a long time. [...]. ^ top ^

Japan protests after Chinese ships enter Diaoyu waters again (SCMP)
Japan yesterday lodged its first diplomatic protest with China in more than three weeks, after the Japanese coastguard spotted Chinese ships in waters near a group of disputed islands in the East China Sea. The protest came as Tokyo and Beijing were reportedly preparing for talks on the dispute, which has damaged relations and affected trade between the two countries. The Japanese coastguard said three Chinese maritime surveillance vessels moved into waters near Minamikojima, known as Nan Xiaodao in China, early yesterday morning. It is one of the five main islets of the Diaoyu Islands, known as the Senkakus in Japan. Another Chinese maritime surveillance vessel entered Japan's territorial waters an hour later, the coastguard said. The four vessels remained for more than seven hours before moving out to the contiguous waters, a band that stretches a further 12 nautical miles from shore. This is the first time since October 3 that Chinese surveillance vessels have entered the 12-nautical-mile zone around the Diaoyu Islands. The earlier incident also triggered a diplomatic protest from Tokyo. Japan's deputy foreign minister, Chikao Kawai, "strongly protested" to China's ambassador in Tokyo, Cheng Yonghua, about yesterday's incident, but Cheng rejected the protest, China News Service reported. China responded strongly in a signal that it still wants to appear firm in handling the dispute despite showing a willingness to ease tensions by engaging in bilateral talks ahead of next month's Communist Party congress that will unveil China's next leadership line-up. "The Chinese maritime surveillance vessels conducted routine patrols in the territorial waters around China's Diaoyu Islands to safeguard the country's sovereignty," Foreign Ministry spokesman Hong Lei said. The Ministry of National Defence also said China would continue with military drills around the disputed islands. "This is … definitely not the last time for the Chinese military to stage drills," ministry spokesman Yang Yujun said. [...] Mainland analysts said the two countries wanted to contain rising tensions and avoid complications ahead of the politically sensitive party congress, which will start on November 8, but that at the same time, Beijing does not want to be perceived as weak. [...]. ^ top ^


Domestic Policy

Jiang Zemin returns to spotlight with a salutory couplet to former school (SCMP)
Former president Jiang Zemin made yet another high-profile foray into the public eye ahead of the Communist Party's key congress next month, as the octogenarian sent congratulations to his former middle school, in Yangzhou, Jiangsu, on its 110th anniversary. Jiang, 86, wrote a calligraphy couplet on Thursday to mark the anniversary of his alma mater, Yangzhou Middle School, and to highlight contributions that the school has made in the nation's development, by nurturing various talents over the years, according to a report yesterday in the Xinhua Daily, a Nanjing -based newspaper affiliated with the Jiangsu provincial party committee. The gesture was the fourth high-profile public activity the former top leader has participated in during the past month. [...] Chen Ziming, a Beijing-based political analyst, said that, by taking the limelight time and again over the past few weeks, Jiang may be trying to send a reminder to the public that he remains in good health and that he still wields political influence. "Jiang has emerged because a consensus [on the line-up of the next leadership] has not been finalised, and there's still room for political contesting. Otherwise, there would be no point in him doing such things anymore," Chen said. [...]. ^ top ^

'Uncle House' under investigation (China Daily)
An official in Guangzhou, capital of Guangdong province, has been removed from duty after investigators found he owned far more houses than he could afford on his salary, according to a disciplinary watchdog's announcement on Monday. Cai Bin, 56, who is commonly known as fangshu, or "Uncle House" among locals and netizens, was restricted from traveling and asked to cooperate with further investigations, Mei Heqing, a senior official with the city's Party commission for discipline inspection, said at a news conference. Cai is suspected of receiving huge bribes when he served as deputy chief of Panyu district's public security bureau and head of the district's urban management bureau, according to Mei. Investigations showed that Cai and his family owned 22 houses, one more than the number claimed by whistleblowers who recently brought the scandal to light online. Cai's properties are in Panyu and Nansha districts and include factory buildings, villas, commercial apartments, business complexes and parking lots. [...] A local real estate agency estimated that the total market value of the properties Cai and his family members own could reach more than 40 million yuan ($6.3 million). As a county-level official, Cai's monthly pay is around 10,000 yuan, while his wife, Shi Liying, earned less than Cai. Shi was director of the general office and secretary-general of the Panyu district association of industry and commerce before she retired. Cai's son, Cai Zhanpei, who has Australian citizenship, lives in Guangzhou and runs an advertisement company. [...]. ^ top ^

Dozens hurt in big Hainan township power plant pollution protest (SCMP)
Thousands of residents in the coastal town of Yinggehai, Hainan, demonstrated at the weekend against plans to build a large power plant nearby, with dozens injured and more than 100 detained by police, according to witnesses. Several hundred set off for the tourist resort of Sanya on Friday and Saturday and blocked a bridge next to the municipal government offices, after local officials refused to see them. In Yinggehai, more than 1,000 armed police and dozens of police vehicles arrived in the town Friday night. Officers used tear gas to disperse the crowds, who stormed government buildings and fought back using bricks and stones, witnesses said. The protest was the latest since January against government plans to build a coal-fired power plant on the town's doorstep. [...] The demonstrations are among the latest featuring mainland residents standing up to oppose feared or actual environmental pollution. In July, tens of thousands of people in Shifang, Sichuan, clashed with police, resulting in plans for a proposed copper plant being scrapped. [...] Tang Fei, a Yinggehai native, said: "Yinggehai is a small place, with only 20,000 people, but we try our best to protect our environment. Most villagers from [the villages of] Heishan and Fengtang, where the plant would be built, went to Sanya to call on the municipal government to hear their concerns. "A large number of students who study outside Yinggehai came back to the town on Friday and joined the protests. It's hard to know how many people exactly have been detained." Tang said the heavy security presence remained yesterday, and street lights had been turned off last night to try to keep people in their homes. Security officers were also seen entering schools and homes, as well as guarding local government offices and main roads, Tang said. [...] Mainland media have remained silent on the protests, and internet censors have blocked searches for "Yinggehai" on microblogs. ^ top ^

Leftists urge NPC not to expel Bo Xilai (SCMP)
A group of leftists has issued a public letter calling on the country's parliament not to expel former top leader Bo Xilai from its ranks, saying the move is legally questionable and politically motivated. Stripping membership from Bo - the one-time Communist Party chief of Chongqing who is accused of abusing power, taking huge bribes and other crimes - paves the way for formal charges against him. Bo's ousting has exposed deep rifts in the party between his leftist backers, who are nostalgic for the revolutionary era of Mao Zedong, and reformers, who advocate faster political and economic reforms. The letter, carried on the far-left Chinese-language website "Red China" and addressed to the parliament's standing committee, says the party is fuelling doubts about the accusations against Bo by refusing to discuss them publicly. "What is the reason provided for expelling Bo Xilai? Please investigate the facts and the evidence," it says. "Please announce to the people evidence that Bo Xilai will be able to defend himself in accordance with the law." Parliament and its members were there to provide oversight and make laws, not to "act as a rubber stamp" for attacks on people for personal reasons by political factions, it added. [...] The letter said there were still many doubts over the Heywood case, including how the defendants were allowed to defend themselves and the brief nature of the two court cases. "Is this not a big joke we are playing on the world when we have been telling people left, right and centre that we are a country with rule of law?" "Red China", which has issued a torrent of commentary defending Bo, is blocked to the many Chinese users who do not know how to evade censorship barriers, and the letter is likely to fall on deaf ears in any case. [...]. ^ top ^

China's aged population to more than double by 2053: committee (Xinhua)
The number of Chinese senior citizens is expected to skyrocket from the current 185 million to 487 million, or 35 percent of the population, by 2053, according to the China National Committee On Aging. "The aging problem came late to China and the country is still struggling to create mature policies addressing the issue," Zhu Yong, vice director of the committee, said Monday at a seminar on aging held by the committee, the United Nations Population Fund (UNFPA) and HelpAge International. China had about 185 million people above the age of 60, or 13.7 percent of the population, as of the end of last year. The figure is expected to surge to 221 million in 2015, including 51 million "empty nesters," or elderly people whose children no longer live with them. Zhu urged authorities to draw experience from developed countries in order to reduce uncertainties and risks. At the seminar, experts recommended improving economic and health support, building more facilities for urban and rural senior residents, encouraging them to participate in social activities and establishing a medical treatment network for the aging population. [...]. ^ top ^

Chinese official suspended from post over high wages (Xinhua)
A government official in east China's Zhejiang Province was removed from his post on Monday after authorities found that his annual salary was 20 times greater than that of his subordinates. Shen Jilong, head of the notary office of the city of Tongxiang, was suspended from his post following a further investigation regarding possible violations of wage distribution and financial regulations, the local government said Monday. An audit showed that his annual wages in 2010 reached 832,200 yuan (about 132,110 U.S. dollars), while 12 of his office staff earned just 41,700 yuan on average that year. The audit indicated that expenses related to food, gifts and business tours hit nearly 1 million yuan in 2010. An investigation conducted by netizens revealed on Wednesday that one of the office's "business tours" was actually a crab dinner for the city's notary association held in the city of Suzhou in neighboring Jiangsu Province. The bill for the dinner totaled 161,000 yuan, according to their investigation. Zhu Liping, deputy director of the city's justice bureau, was also suspended from her post for neglecting her duties. [...]. ^ top ^

Legislature convenes bimonthly session, deliberates draft laws (Xinhua)
The Standing Committee of the National People's Congress (NPC), or China's legislature, began a four-day bimonthly session on Tuesday to deliberate several draft laws. Presided over by Wu Bangguo, chairman of the NPC Standing Committee, the first plenary meeting of the session was held Tuesday morning at the Great Hall of the People. According to the meeting's agenda, lawmakers at the session will continue their deliberation of a draft mental health law and a draft revision for the Law on Securities Investment Funds. Following two readings in October last year and August this year, the draft mental health law was presented for a third reading at the session. It includes provisions on ensuring the safety of property belonging to patients of mental disorder and the government's duty to promote mental health, as well as issuing allowances to mental health workers. The draft revision for the Law on Securities Investment Funds was first tabled for deliberation in June and will undergo its second reading this week. Lawmakers at the session will discuss a decision to amend certain provisions for seven laws that are inconsistent with the amended Criminal Procedure Law, which was adopted in March by the NPC and will take effect on Jan. 1, 2013. The seven laws are the Prison Law, Law on Lawyers, Law on the Protection of Minors, Law on the Prevention of Juvenile Delinquency, Law on Penalties for Administration of Public Security, the State Indemnity Law and People's Police Law. Lawmakers will also discuss a draft amendment to the Postal Law, which was tabled for the first time. [...] Foreign Minister Yang Jiechi, entrusted by the State Council, gave an explanation for two treaties signed between China and other countries while submitting them to the session for ratification. One is the China-Tajikistan-Afghanistan treaty on the definition of the tri-junction point for national boundaries, while the other is the China-Thailand treaty on the transfer of sentenced persons. [...]. ^ top ^

Most Chinese cities are not coming clean on smog (SCMP)
Despite some recent progress in Beijing and other big cities, most mainland cities have still not made a sincere effort to improve transparency about their air pollution problems, according to a study. The Institute of Public and Environmental Affairs' survey of 113 cities found 78, including many provincial capitals and major industrial hubs, had yet to release information on fine airborne particulate, such as PM2.5. Increasing concern about PM 2.5 - particles matter less than 2.5 micrometres in diameter which, because they are so fine, can lodge deep in the lungs - spurred a national outcry at the government secrecy surrounding smog problems. That led to a major overhaul of outdated clean-air standards. "This is a reality check," said Ma Jun, director of the Beijing-based institute. "We've seen some breakthroughs in Beijing and Guangdong as a result of the stricter pollution limits, but we also clearly see a widening gap between different regions." Of the 55 cities that began to publish PM2.5 readings this year, Beijing and some Pearl River Delta cities ranked best owing to their strides in disclosing PM2.5 data and giving ample, up-to-the-hour information from dozens of monitoring stations. Beijing, which in January became the first to publish readings of the smog-inducing particles, ranked fifth, with a score of 65 out of 100, on the institute's Air Quality Transparency Index. [...] Dongguan, Foshan, Guangzhou, Shenzhen, Zhongshan and Zhuhai rounded out the top seven cities, thanks to the country's largest air-quality-detection network, which was launched in March and consists of 17 stations. While Shanghai and cities in Fujian, Jiangsu and Zhejiang have also begun publishing air pollution data, transparency remains poor nationwide. The average score of all 113 cities - mostly municipalities, industrial hubs and provincial capitals - was 21.5 on the index. [...] "We know transparency is only the first step in the long journey towards tackling the real pollution problems and we also need to improve the quality of the data to address discrepancies between official monitoring data and public feelings," Ma said. ^ top ^

Mainland elderly still rely largely on family, not pensions (SCMP)
Just under a quarter of the mainland's elderly residents survive on pensions, while more than 40 per cent seemingly rely on family members, according to new official figures. The data was revealed at a joint forum held by a United Nations group and a central government agency on the eve of yesterday's "Double Nine", or Chung Yeung, festival - a day traditionally reserved in Chinese culture for paying respects to ancestors and the elderly. It follows an online survey earlier this month, which found about 90 per cent of the public was seriously concerned about their quality of life in old age. [...] Du Peng, deputy director of the Centre on Ageing Studies at Renmin University, said at the forum that a study he conducted in 2010 found 24. 1 per cent of the elderly population was receiving pensions, compared with 19.6 per cent 10 years earlier. The percentage of senior citizens living on the support of family members dropped from 43.8 per cent in 2000 to 40.7 per cent in 2010. Du also noted a huge disparity between elderly residents in urban and rural areas. In cities, almost two-thirds of the elderly live off pensions - a stark contrast to the 4.6 per cent who do so in rural areas. And the average monthly pension in cities was 1,527 yuan in 2010, while in rural areas it was a paltry 74 yuan, reports. [...] In a survey carried out earlier this month by and the China Philanthropy Times, more than 90 per cent of about 60,000 respondents feared they wouldn't be able to receive pensions when they retire, and were concerned that there wouldn't be anyone to take care of them. Peng was quoted by The Beijing News as saying that one-third of the mainland's elderly people are "empty nesters", meaning their children live elsewhere. [...]. ^ top ^

China issues white paper on energy policy (Xinhua)
China on Wednesday issued the 2012 edition of a white paper on its energy policy to elaborate on the world's largest energy producer's policies on energy development, conservation and the promotion of renewable power sources. The white paper, titled "China's Energy Policy 2012," was released by the Information Office of the State Council, or China's cabinet. During the 1981-2011 period, China's energy consumption increased by 5.82 percent annually, underpinning the 10-percent annual growth of the national economy, said the white paper. China has built up a comprehensive energy supply system comprising coal, electricity, petroleum, natural gas, and new and renewable resources, according to the document. [...] In 2011, China's output of primary energy equaled 3.18 billion tons of standard coal, ranking it first in the world. Of this, raw coal reached 3.52 billion tons; crude oil, 200 million tons; and refined oil products, 270 million tons. Meanwhile, the output of natural gas ballooned to 103.1 billion cu m. Installed electricity generating capacity reached 1.06 billion kw, and the country's annual output of electricity was 4.7 trillion kwh. From 2006 to 2011, China's energy consumption for every 10,000 yuan of gross domestic product (GDP) dropped by 20.7 percent, saving energy equivalent to 710 million tons of standard coal. [...] China will actively develop hydropower, solar power and wind power generation, seek safe and efficient ways of developing nuclear power, as well as utilize biomass energy and other types of renewable energy, according to the white paper. China plans to increase the share of non-fossil fuels in primary energy consumption to 11.4 percent and increase that of installed generating capacity from non-fossil fuels to 30 percent by the end of 2015, the paper added. [...] However, China's energy development still faces many challenges. Its energy resource endowment is not high and its per-capita share of coal, petroleum and natural gas is low. Facing the challenges, the country will reinforce research and development of energy technology, promote the progress of energy equipment technology, launch major technological demonstration projects, and introduce greater innovation to energy technology, said the paper. [...] Moreover, the government will provide extra funding to Tibet for its electric power development, with direct investment between 2011 and 2015 to exceed 900 million yuan, the paper said. ^ top ^

Ningbo activists seek big weekend protest over Sinopec plant expansion (SCMP)
Hundreds of people in the city of Ningbo demonstrated for a third consecutive day yesterday over plans to expand a controversial petrochemical plant. The government said the work would continue despite calls for a larger protest during the weekend. After a string of small-scale protests over the past two weeks in the Zhenhai district of the city, residents have called for a bigger gathering at Tianyi Square in central Ningbo, in Zhejiang province, at the weekend. Many suspect the authorities are trying to hide critical information about the pollution that will result from a 55.9 billion yuan (HK$68.7 billion) expansion of the oil refinery, China's biggest, and associated chemical plant operated by Sinopec. The Zhenhai district government showed no sign of backing down. Xinhua quoted the district government as saying yesterday that the expansion, which will increase annual oil refining capacity by 15 million tonnes and ethylene production capacity by 1.2 million tonnes a year, met the requirements of an environmental assessment. "Detailed information will be published when environmental reviews are implemented and public opinions on the project will be heeded," the statement said. The government's pledges did nothing to ease residents' concerns. Of particularly concern is the production of paraxylene, known as PX, which is widely used in paints and plastics. If inhaled in large quantities, the toxic chemical can damage the central nervous system, liver and kidneys, and chronic exposure may result in death. The plant already produces 500,000 tonnes of PX a year. The Xinhua report said online postings had "demonised" PX, and claimed it was groundless to say PX would cause cancer. [...] One resident said the villagers began to petition about two weeks ago, and were then joined by more young people, who have long been frustrated by the severe pollution caused by the numerous petrochemical plants in Zhenhai." Zhenhai was transformed into a petrochemical base in 1970s, but over the past several years there are more chemical plants moving in, which led to an increase in cancer and birth defects," the resident, surnamed Ren, said, adding that his mother has died of cancer. The mayor of Ningbo, Liu Qi, who worked in the petrochemical industry, told a meeting in August that the local government should "go all out to clear any obstacles to kick off the expansion project as soon as possible" to build Ningbo into a world-level petrochemical base, according to local media reports. [...]. ^ top ^

In China, connections still beat know-how for job-hungry youths (SCMP)
Researchers have confirmed what many young jobseekers have long suspected: family wealth and connections play a larger role than hard work in whether university graduates can get good jobs and improve their social status. An eight-year study of more than 400 graduates from a Hunan province university found that those hailing from rural or small towns made significantly less on average than their urban counterparts three years after graduation. By then, rural students made 23,380 yuan (HK$28,600) a year, compared with 26,635 yuan for urban students. Similarly, the study by the Hunan party school's Population Research Institute found only eight of the 68 students who qualified as low-income managed to reach a new social status. Meanwhile, all students who were the children of public servants or business executives were found to have stable jobs. "Family background weighs more in career development in this society because the mechanism of upward mobility is not working and [those in] the middle and lower levels of society are finding it difficult to climb the social ladder by working hard," said Dou Xiaohong, who led the study. "They start off with few advantages and the career development is not entirely a fair process." Dou blamed the disparity on unfair recruitment practices in a society that places a high value on personal connections. Graduates whose families have access to power, money and resources are more likely to get a good job, especially in government agencies or state-owned enterprises. As a result, less-advantaged graduates changed jobs more often than privileged ones, as they tried to trade up. Those coming from low- or lower-middle-income families were seven times more likely to have changed jobs three or more times. [...]. ^ top ^

China's nuclear plan back on track after 19-month freeze (SCMP)
Beijing has officially lifted the freeze on new nuclear projects, ending a 19-month ban on approvals imposed in the wake of Japan's nuclear disaster last year. But a State Council meeting yesterday, chaired by Premier Wen Jiabao, also decided to raise safety standards significantly and to drop proposals for the construction of nuclear reactors in inland provinces for the next three years. Just a week after the approval of a five-year nuclear safety plan, the government gave the green light to the long-term development plan for nuclear power, which runs to 2020 and signals its readiness to rekindle its ambitions for atomic power. "The adoption of the safety plan and the long-term blueprint eventually puts an end to the ban on nuclear-project approvals and means authorities are again ready to give approval for new projects," said Yang Fuqiang, a senior energy adviser for the Natural Resources Defence Council's office in Beijing. But Yang and other experts also noted that, with a ban on building inland reactors by 2015 and much stricter safety standards, China's nuclear ambitions and the pace of its nuclear expansion will be significantly scaled down from plans adopted before the Fukushima nuclear disaster. According to the State Council decision reported by Xinhua, all new nuclear reactors must meet safety standards for so-called third-generation reactors. "Only a few nuclear plant projects that have gone through comprehensive considerations will be allowed to be built in coastal regions and there will be no nuclear projects in inland regions during the 12th five-year period," it said. Just days before Fukushima China had rolled out a plan to become the world's leader in nuclear energy by 2020, with more reactors to be built by then than the rest of the world put together. But Japan's disaster in March last year changed everything. [...]. ^ top ^

Bo Xilai's lawyer unsure if he can take case (SCMP)
A lawyer for disgraced former top Chinese politician Bo Xilai, who has been employed by the family to represent him, said on Thursday he was unable to say whether the government would allow him to represent Bo when the case comes to trial. [...] Bo's mother-in-law, Fan Chengxiu, has retained Li Xiaolin, who was also part of Gu's legal team, to represent him. But Li said he was unsure if the authorities would allow this. During Gu's trial, she had to use government-appointed lawyers. “I still can't say whether I'll be able to get involved in this case. We will try our hardest to take it,” Li told reporters in a brief telephone interview. Li said he did not know where Bo was and added that he had not seen him, as he had only just been employed by Fan. “There are many things that are impossible to know. I know about as much as you do,” Li said. He declined to speculate on when a trial may happen. “How can I estimate this? It's all guess work,” Li said. China is expected to expel Bo from parliament on Friday, which would strip him of the immunity from prosecution he had enjoyed as one of its members, paving the way for formal criminal charges to be laid. As China's prosecutors and courts come under Communist Party control they are most unlikely to challenge the accusations against him. [...]. ^ top ^

China names new military chief of staff (SCMP)
China has appointed a new army chief of staff and other top officers in the run-up to next month's national leadership transition as the nation attempts to professionalise the world's largest standing military. The Defence Ministry announced on Thursday that Fang Fenghui is taking over as chief administrator of the People's Liberation Army who supervises recruiting, training and other key functions. The appointment puts Fang, a former head of the military region that includes Beijing, firmly on track for a position on the Central Military Commission overseeing the 2.3 million-member PLA when the new lineup is announced at the Communist Party congress that begins November 8. The appointments were long anticipated as part of the shift to power under incoming party leader Xi Jinping, who, despite taking over the reins, is believed to have relatively little say in the naming of new military leaders. Instead, the selections reflect the choices of outgoing leader Hu Jintao, who oversaw the promotion of officers such as Fang during his decade in power. Fang, who commanded an elaborate military parade celebrating the 60th anniversary of the communist state in 2009, was promoted to full general by Hu in 2010. [...] The PLA's three other top army staff positions also received new directors. Zhao Keshi was named head of logistics, Zhang Youxia as head of armaments, and Zhang Yang as director of the political department, the ministry said. Several other deputy positions were announced, and the ministry earlier named former fighter pilot Ma Xiaotian to lead China's air force, which has become increasingly vital to China's defence strategy. ^ top ^



Plan to halve capital's traffic controversial (Xinhua)
A proposal to tackle Beijing's traffic gridlock, which would halve the number of vehicles on its streets, has sparked controversy among experts and residents. The capital's transport commission says officials will consider requiring vehicles with odd and even registration plate numbers to stay off roads alternately "at specific periods of time and in specific areas". A similar measure was enforced for two months during the 2008 Olympic Games to combat congestion and improve air quality. Traffic dropped by 21 percent on major roads, and average speeds increased by about 27 percent within a month of the measure being introduced, transport authorities said. However, the measure has not been enforced since the Olympics. [...] There are more than five million vehicles on the streets of the capital, a city with a population of more than 20 million, making it one of the most congested in China. Motorists are already restricted from driving their cars one day a week, according to the last digit of the plate number. Other measures to check traffic congestion, such as raising parking fees and limiting new-car registrations to 20,000 a month through a lottery system, have also been imposed. If approved, the latest proposal will probably have a greater effect than other restrictions, Chen said. [...] Wang Limei, secretary-general of the China Road Transport Association, said: "I think caution is required. It could ease traffic congestion in the short term, but it can't solve the problem at the root. [...] Liu Fuli, an independent expert in traffic congestion, said problems in city management and planning also caused serious traffic problems in Beijing. "For example, many bungalows in the urban area have been demolished and replaced by commercial buildings, which attract much higher traffic volume," he said. Liu's opinion is echoed in a report on Beijing's social development released on Wednesday by the Beijing Academy of Social Sciences, which says more than half of the city's total traffic load occurs within the Third Ring Road, a very small portion of the capital's total area. The root cause of traffic congestion lies in misplanning the report said. ^ top ^



Police offer rewards for immolation tip-offs after more Tibetan deaths (SCMP)
Police in a heavily Tibetan region in the far west of China are offering tipsters a reward of 50,000 yuan (HK$66,000) for information about planned self-immolations, in a bid to stem the fiery protests against Beijing's rule. Since the notice was issued on Sunday by police in Gansu province's Gannan prefecture, two more local Tibetans, a herdsman and a farmer, died after setting themselves on fire near the Labrang Monastery in Gannan. [...] Gannan police issued a notice saying that the string of recent immolations in the community had "seriously impacted social stability and harmony as well as people's ability to live and work". It said that in order to crack down on the demonstrations, people who tip off police about immolation plans will be rewarded 50,000 yuan. The notice said that people who provide information on the "black hands" who organised four recent self-immolations would be rewarded up to 200,000 yuan. The notice promised to keep the identity of informers confidential. Mainland authorities have accused supporters of the Dalai Lama of encouraging the self-immolations. At least seven people have set themselves on fire in Gannan since March, including two women, and all have died, according to the International Campaign for Tibet, which is based in the United States. On Monday, a herdsman died in Gannan's Xiahe county near the Labrang Monastery after setting himself on fire. A day later, a farmer died after setting himself on fire on Xiahe's main street. ^ top ^



Pro-national education protesters march on Admiralty (SCMP)
Hundreds of parents and students marched through busy streets yesterday in support of national education - the second big event in a week to support the controversial subject. Proponents of the curriculum have been fighting back since the policy was all but dropped by Chief Executive Leung Chun-ying amid widespread protests from parents, teachers and opposition lawmakers, who likened it to "brainwashing" of children by Beijing. Waving banners and Chinese national flags, participants chanted "support national education" and "give us back the right to learn" as they marched from Victoria Park in Causeway Bay to government headquarters in Admiralty. The organisers, Caring Hong Kong Power, said there were 1,000 participants, but police estimated the turnout was about 600. "We like to let the government know that anti-national education is not the only view in Hong Kong," a spokeswoman for the group said. "There are also many people who want national education. "As Chinese, it is absurd that we should refuse to know our country. The critics are not only against the subject, they are against anyone who disagrees with them." [...]. ^ top ^

Emissions control area for ships in Pearl River Delta proposed (SCMP)
The government is determined to set up an emissions control area for ships in the Pearl River Delta, environment undersecretary Christine Loh Kung-wai said yesterday. It would be the first such region in Asia and only the third in the world. It follows figures released last month by Civic Exchange, a think tank founded by Loh, which showed that within the Pearl River Delta region, Hongkongers account for 75 per cent of deaths attributed to sulphur dioxide in ships' emissions. It said those deaths could be reduced by 91 per cent by setting up an emissions control zone. The move would mean all ocean-going vessels entering the zone would have to switch to low sulphur fuel. Loh said the government was already discussing with the Guangdong government rules for the use of environmentally friendly fuel in port. She told a meeting yesterday of the Legislative Council's environment committee that the Environment Bureau was "very determined" to set up an emissions control zone. She offered no timetable but hoped to make "take a big step" towards realising the goal in the current adminstration's five-year term. [...] All vessels in the two existing emissions control areas - in Scandinavia and North America - must switch to 1 per cent low sulphur fuel inside those areas. By 2015, that limit is to be tightened to 0.1 per cent. Loh said Hong Kong's Fair Winds Charter, a voluntary scheme which saw 18 shipping lines agree to switch their fuel to 0.5 per cent sulphur in port, had helped reduce the concentration of sulphur dioxide in the air by 6 per cent. That pact will end in December. [...]. ^ top ^

Hong Kong still No 2 for ease of doing business (SCMP)
Hong Kong remains the second-best place in the world to do business, pipped again by Singapore, which for the seventh consecutive year topped a global survey of business-friendly economies. China, the world's second-biggest economy, lagged in 91st place but was the most improved market in the Asia-Pacific region to do business. The annual Doing Business survey, conducted since 2003 by the International Finance Corporation and the World Bank, compares the business and regulatory environment of 185 markets worldwide to assess how easy it is for local small- and medium-sized companies to do business. It examines procedures for starting a business, getting bank loans or other credit, applying for an electricity supply, transferring properties and the ease of cross-border transactions. "Singapore and Hong Kong remain the most business-friendly regulatory environments for local entrepreneurs globally," said Karim Belayachi, co-author of the report. [...] In 2009 Hong Kong shortened the time needed to obtain a construction permit to 67 days, from 119, making it the most competitive in the survey. Mainland China ranks almost at the bottom in this category as it takes 28 procedures and 270 days to get a permit. Hong Kong has also improved in others areas of business operations. It takes an average of just 41 days to obtain electricity, compared with 93 days in 2010. Companies on the mainland must wait 145 days. Hong Kong still loses out to Singapore in areas such as registering property. In Hong Kong it takes 36 days, while in Singapore it's just 21 days. Hong Kong's export costs are also higher. [...]. ^ top ^

24pc of people worried about press freedom, survey shows (SCMP)
Almost one in four people are dissatisfied with the state of press freedom, a record since the change of sovereignty in 1997, a survey shows. The public opinion programme at the University of Hong Kong interviewed more than 1,000 people early this month for its twice yearly appraisal of local news media. Of these, 24 per cent said they were dissatisfied with the state of press freedom, almost double the 14 per cent in April. It was the highest rate since the survey started in September 1997. Some 54 per cent said they were satisfied, a significant drop of 15 per cent from April. Almost half the respondents perceived that the local news media was practising self-censorship, a slight decrease on the last survey. Some 48 per cent felt the news media had scruples when criticising the mainland government, a drop of seven percentage points, while 31 per cent thought the same when it came to criticising the Hong Kong government, a drop of five points. Programme director Robert Chung Ting-yiu said people's satisfaction with press freedom had receded significantly "but the general credibility of the news media has not changed much". Among various types of news media, people are still most satisfied with television, followed by radio. The third and the fourth places are taken by newspapers and the internet, while magazines remain the least favoured. Hong Kong Human Rights Monitor director Law Yuk-kai said the figures showed the latest trend concerning press freedom might not be directly related to self-censorship but more about the government's handling of media and information. He said the government had demonstrated a heavy hand in recent months by detaining and charging journalists. Leung's administration also repeatedly refused to publicise senior officials' visits to Beijing ahead of their trips. [...]. ^ top ^



Taiwanese official Lin Yi-shih charged for taking NT$63 million in bribes (SCMP)
Taiwanese prosecutors yesterday indicted a former top official on corruption charges in a high-profile court case that has tarnished the image of squeaky clean Taiwanese President Ma Ying-jeou's government. Lin Yi-shih, 42, former secretary general of Taiwan's cabinet and a vice-chairman of the ruling Kuomintang, was charged with four counts of corruption for allegedly pocketing NT$63 million (HK$16.6 million) in bribes. A copy of the indictment posted on the government website said Lin demanded bribes from a businessman - identified as Chen Chi-hsiang, the owner of Kaohsiung-based Dih Yeon Industrial - in exchange for helping the businessman to secure a slag treatment contract two years ago. Lin was a legislator at the time. The Supreme Prosecutors Office's special investigation division, which had investigated the case since July and issued the indictment yesterday, did not identify the company which offered the contract to Chen. But local media reported it was CHC Resources, a subsidiary of the listed China Steel Corp. Both companies are based in Kaohsiung, and the island's government holds a major stake in China Steel. [...] Chen reported Lin to the authorities for attempting to demand another NT$83 million in bribes between February and March. After Chen refused to give in to Lin's demands, he found that he could no longer obtain slag for treatment. "What Lin did seriously violated his position," the indictment said. Lin - who was a close confidant of Ma and was previously thought to be being groomed by the president for higher political office - initially denied he had anything to do with the graft, claiming it was a political set-up by his opponents. But he was forced to admit his crime and resign in July after an account of a tape recording of him demanding bribes from the businessman was reported word for word by local media. The indictment made no mention of any jail term recommendation by the prosecutors, but court officials said such serious corruption cases could result in a maximum sentence of life imprisonment. [...]. ^ top ^



Govt to support solar power industry (China Daily)
The Chinese government will support the connection of photovoltaic solar power producers to the national grid with favorable policies, in a bid to expand the domestic market and help the industry get through tough times, an official has said. "A document on how State Grid will support China's PV solar industry has been handed to the central government and is waiting approval," said Meng Xiangan, deputy director of the China Renewable Energy Society. State Grid Corp, China's largest State-owned utility company, is expected to allow local grid companies at city level to approve solar power plants with installed capacities of less than 10,000 kilowatts each to be connected to the grid. The move is seen as "very encouraging" news by Meng. State Grid also plans to not charge solar power companies for integration with the grid, which usually costs millions of yuan, and to simplify the process, according to the document. "The obstacles that companies face in order to be connected to the national grid are the biggest problem for the PV solar power industry, as well as many other new energy industries," he said. "The new plan will help solve the problem, and it shows the central government's determination to support the development of the solar industry by solving the grid-connection issue." However, he said that it is still hard to predict when the plan will get approved and be in place. [...]. ^ top ^

Tax relief for more mainland companies (SCMP)
Vice-Premier Li Keqiang has pledged to expand a trial programme overhauling the tax system to more industries and regions, underlining Beijing's urgency in boosting businesses that are key to creating jobs. The government aims to replace the business tax with a value-added tax for companies in more industries, including postal and telecommunications, railways and construction, Li said at a meeting last week and reported by Xinhua. He also reportedly vowed to expand the programme gradually to cover the whole nation. While Li, expected to become the next premier after next month's leadership change, did not give a timetable for extending the reform, his comment reflects the government's determination to boost services and cut reliance on exports and investments over the next decade. "The most important purpose of the reform is to significantly cut the tax burden for the services industry," said Liu Li-Gang, a senior executive at Australia & New Zealand Banking Group. Shanghai started the VAT pilot on January 1. The reform so far covers transport and some service industries such as information technology, research and development, culture and logistics. The existing tax system, in place since 1994, allows for both business tax and value-added tax, creating double taxation for enterprises in the services sector. With the economy slowing for seven quarters in a row, Beijing is eager to cut costs for small companies, many of them in the services sector. [...] Li acknowledged the reform has "entered a crucial stage and deep water areas". The reform is expected to further slow tax collection at the central and local government levels. [...]. ^ top ^

More European firms favor renminbi for transaction (China Daily)
The renminbi is becoming more popular in international transactions as companies in Europe benefit from using the Chinese currency, according to a survey by Deutsche Bank. Around 20 percent of the surveyed companies in the United Kingdom, Germany and the Netherlands carry out invoicing in the Chinese currency, and the remaining 80 percent said they are considering doing so. Using the renminbi helps companies reduce costs and obtain access to more business partners in China. When companies use the Chinese currency, they can lower prices by an average of 4.8 percent when negotiating with Chinese partners, according to the survey. Switching to the currency means more benefits for small and medium-sized companies, according to Nils Ole Matthiessen, Deutsche Bank's head of global finance and foreign exchange. He added that SMEs will have a wider network of suppliers and partners in China after switching to the renminbi, because they can do business with Chinese companies who previously had limited access to Western currencies. [...] The survey said that banks in London are also expanding renminbi transactions in other emerging markets as business grows between China and Africa. In South Africa, the Chinese currency accounted for around 10 percent of total payments in July, compared with 6 percent in January. Citibank recently revealed its renminbi transactions generated out of London had increased by 40 percent since the beginning of the year, and the number of renminbi accounts opened in the UK had risen by more than 80 percent. "Our renminbi offering is making significant progress across Europe, the Middle East and Africa, and we are keen to leverage the breadth of Citi's network to expand our RMB solutions throughout the region," said Rajesh Mehta, Citi's regional head of treasury and trade solutions for Europe, the Middle East and Africa. [...] The use of the renminbi in trade outside China is around $2 billion a day. Cross-border renminbi processing volume rose 42 percent year-on-year to 1.4 trillion yuan ($222 billion) in the first half of this year, according to Deutsche Bank. But companies still face challenges using the Chinese currency. The greatest obstacles are the slow payment process and difficulties in obtaining approval for payments from the authorities, according to the survey. [...]. ^ top ^

China becomes world's largest FDI recipient in first half of 2012 (Xinhua)
China exceeded the United States to become the world's largest recipient of foreign direct investment (FDI) in the first six months of 2012, a report released by the United Nations Conference on Trade and Development (UNCTAD) showed on Tuesday. It's mainly due to a 39.2 percent fall in FDI flows to the U.S., compared to a three percent decline in China, said Zhan Xiaoning, director of UNCTAD Division on Investment and Enterprise. However, early indications show that FDI flows to the U.S. might be stronger in the second half of 2012, he said. Zhan said China once claimed the world's top destination for FDI in 2003. In the first six months of the year, China attracted 59.1 billion U.S. dollars in FDI while the U.S. attracted 57.4 billion U.S. dollars, according to the latest Global Investment Trends Monitor. As a result of the performance of the U.S. and a decline of 23 billion U.S. dollars in flows to BRIC countries, the global FDI stood at 668 billion U.S. dollars, dropping by eight percent over the same period of 2011, said the report. The report also showed that developing countries (without transition economies) for the first time absorbed half of global FDI inflows. UNCTAD projects the FDI flows will, at best, level-off in 2012 at slightly below 1.6 trillion U.S. dollars, according to the report. [...]. ^ top ^


DPRK and South Korea

North Korea condemns Lee's Yeonpyeong island visit (SCMP)
North Korea on Saturday condemned a recent visit by the South's President Lee Myung-Bak to an island close to their disputed border and reiterated that it only recognises a demarcation line drawn by Pyongyang. A National Defence Commission spokesman said Lee's trip Thursday to Yeonpyeong island, shelled by the North in 2010, intended to raise tensions and rally support for the conservative ruling party ahead of December elections. The spokesman also reiterated Pyongyang's opposition to the Northern Limit Line (NLL) – a frontier drawn by the US-led United Nations Command at the end of the 1950-53 Korean War to prevent any accidental clashes between the two. “This [visit] is a revelation of his [Lee's] foolish attempt to disturb the nation's peace and stability, escalate confrontation and provoke a war by preserving the NLL, the root cause of confrontation and clash,” the spokesman was quoted as saying by the official Korean Central News Agency (KCNA). [...] “Only maritime military demarcation line set by the DPRK (North Korea), not NLL, will remain in the West Sea till the country is reunified,” he added. [...] The North's spokesman added that Lee's visit was “a cynical ploy” ahead of the South's presidential election in December to “create conditions favourable for the conservative ruling party's stay in power”. [...]. ^ top ^

DPRK warns S. Korea of military attacks over anti-DPRK leaflets (Xinhua)
The Democratic People's Republic of Korea (DPRK) warned Friday it might fire on a South Korean border area where Seoul plans to scatter anti-DPRK leaflets next week, the official news agency KCNA reported. "Scattering of the leaflets amounts to undisguised psychological warfare, a breach of the Korean Armistice Agreement and an unpardonable war provocation," the KCNA quoted the Western Front Command of the Korean People's Army (KPA) as saying. The Western Front Command said Rimjin Pavilion and its surrounding area would become the direct target of KPA fire, and a merciless military strike would be put into practice without warning. A KPA notice said the leaflets will be scattered from Rimjin Pavilion of Phaju city, South Korea's Kyonggi Province at 11:30 a.m. (0230 GMT) on Monday. "And it was directly invented by the South Korean government and is being engineered by its military," the notice said. "This is an unpardonable challenge to the army and people of the DPRK and a deliberate act aimed to push north-south ties to the lowest ebb," it said. It also asked South Korean inhabitants living in the area to evacuate in anticipation of possible damage.. ^ top ^

DPRK patrol ship briefly crosses tense sea border with S. Korea: report (Xinhua)
A patrol boat from the Democratic People's Republic of Korea (DPRK) briefly crossed the tense western maritime border with South Korea Thursday, local media reported. The boat violated the sea border while raiding a Chinese fishing boat but retreated at 11:07 a.m. local time following warning messages from South Korea, Yonhap News Agency said citing a military source. The border, called the Northern Limit Line, is the scene of deadly naval skirmishes between the rival Koreas. The DPRK refuses to acknowledge the NLL, which was drawn unilaterally by the U.S.-led United Nations Command (UNC) at the end of the 1950-53 Korean War. Last week, South Korean President Lee Myung-bak visited a front- line island near the sea border and reaffirmed the country's commitment to its defense. The DPRK condemned Lee's trip and reiterated it would only recognize a military demarcation line drawn by Pyongyang. ^ top ^



Softbank plans to develop wind power in Mongolia with Newcom (
Softbank Corp, the Japanese mobile phone company planning to invest $20 billion in Sprint Nextel Corp plans to develop wind power projects in Mongolia. SB Energy Corp., Softbank's clean energy unit, will set up a venture with Mongolia's Newcom LLC as early as this month to conduct feasibility studies on wind power generation, Naoki Nakayama, a Softbank spokesman, said by phone today. Newcom invests in clean technology and infrastructure. The venture will this year examine a site in the Gobi desert which may have a capacity of as much as 300 megawatts of wind power, he said. Should Softbank and Newcom decide to build a wind farm there, operations may start in 2014, according to the spokesman. Nakayama declined to confirm a Nikkei report today that the project will cost about 50 billion yen ($626 million). The venture is also considering three more sites in the Gobi, he said, adding that the four sites could have a total capacity of more than 7,000 megawatts. Softbank President Masayoshi Son has been investing in renewable energy after the Fukushima nuclear disaster. Son is also promoting an “Asia Super Grid” plan to connect power grids from India to Tokyo to allow for stable power supply and boost the use of renewable energy in the region. ^ top ^

China, Mongolia sign agreement on agricultural cooperation (Xinhua)
Chinese and Mongolian delegates inked a deal on Tuesday to further promote bilateral collaboration in the agricultural sector. Under the agreement, signed after a meeting of the China-Mongolia Working Group on Agriculture Cooperation, the two neighbors will push forward their South-South cooperation under the framework of the Food and Agriculture Organization (FAO). China will continue to provide technical assistance to help enhance Mongolia's agricultural production and will help Mongolia provide training and set up its organic product standards and certification systems. Meanwhile, the two sides also agreed to boost cooperation in food safety and agricultural commodity trade negotiations. China and Mongolia have seen rapid development in agricultural cooperation in recent years. China has provided Mongolia with soft loans for the purchase of farm machinery, and has had experts and technicians working in Mongolia since 2010 to help promote Mongolia's national food security program. ^ top ^

President awarded certificate of WHO (Montsame)
The Permanent Representative of the World Health Organization (WHO) to Mongolia Dr. Wiwat Rojanapithayakorn presented a WHO's special certificate to the President Ts.Elbegdorj on Wednesday. The leader of Mongolia has been awarded as such for his appeal to all countries to create a Convention on improving the control over consumption of alcoholic beverages. ‘The WHO highly appreciated this initiative and reflects it in its annual report, even to attract more attention, Your photo, Mister President, goes together with the initiative in this year's report' said Mr Wiwat. The anti-alcoholism fight is a virtuous deed because it saves lives of many people, and the President's initiative has an importance not only for Mongolia but also for many other countries, he said. Then he introduced the President to activities of the WHO in Mongolia and said cardiovascular illnesses, diabetes, stroke and cancers--all caused by alcoholism--are still main factors of mortality in Mongolia. In response, Mr Elbegdorj noted that he had proposed creating this international Convention on controlling alcoholism during a meeting with the UN Secretary-General, and said this Convention is similar to the WHO's Framework Convention on Tobacco Control. He emphasized an importance of the WHO's assistance and support to Mongolia, and said Mongolia will cooperate with the WHO in a realization of his initiative. ^ top ^

Underlying mining development in Oyutolgoi picks up (
Rio Tinto and Turquoise Hills Resources last week publicly and firmly rejected a request by the Government of Mongolia to renegotiate the Oyu Tolgoi Investment Agreement (‘OT IA'), which is widely viewed as a benchmark for Mongolia's commitment towards foreign investment and the country's flagship mining development project. Specific details and the timing of the government's request have not been disclosed but it is believed to be related to the topic of sliding scale royalties mentioned below. As we highlighted in our September 25th comment on the new Government's Action Plan, overall we view the proposed policy platform as favorable to foreign investment, putting forward vigorous reform and guideline to current policy. However, we note mixed messages and a lack of coordinated and clear public approach from the Mongolian authorities on the OT issue. Just after renegotiation pressures were diffused by not naming OT IA specifically for amendment in the Action Plan, or so we thought, a new draft budget for 2013 proposes to increase budget revenues by 445.8 billion MNT (approximately $318 million USD) by introducing sliding scale royalties as well reducing certain tax discounts and waivers to OT. This move has been publicly supported by the Prime Minister and the Democratic Party (‘DP') Parliament Caucus Leader. The proposed 2013 draft budget has been submitted to Parliament for approval and we believe it will be accepted since it has the backing of the DP Caucus. As a whole we view the proposed budget as progressive as the first budget in compliance with the landmark Fiscal Stability law that binds government structural deficit to 2 per cent of GDP. The composition and timing of the budget comes at a critical point for Mongolia as the headline Chinese economic growth has slowed, impacting associated equities and commodities. National statistics show revenue from coal, the country's biggest current export, has been significantly reduced over the summer because of a drop in both price and volume. This situation has not meaningfully improved since and Foreign Direct Investment has remained subdued waiting much needed and proposed clarification or revision to the current law. Last week the European Bank for Reconstruction and Development (‘EBRD') announced that it would provide a direct $250 million USD loan and syndicate a further $100 million USD on the international markets to fund the ongoing development of the Tsagaan Suvarga copper mine located in the central part of the South Gobi porphyry copper belt in southeast Mongolia about 140 kilometers along trend from OT. The Tsagaan Suvarga project is privately owned by Mongolyn Alt Corporation (‘MAK'), one of Mongolia's largest national mining companies. EBRD is owned by 63 countries, two intergovernmental organizations and has committed $846 million USD across 47 projects in various sectors in Mongolia since 2006 and mobilizing an additional $1.8 billion USD for those projects from other investors. ^ top ^

Prime minister questioned by diplomat councils (
Prime Minister N.Altankhuyag held the first meeting today as promised, to answer questions with diplomatic personnel, the council and foreign journalists to Mongolia. During the “Prime Minister: 10 Q&A” meeting, the Prime Minister answered 10 questions selected from over 60 questions proposed by diplomat councils, personnel and journalists. The Prime Minister answered questions about the Government`s three main targets in 2013 in the framework of a new action plan; what measures will be taken by the Government against corruption in Mongolia; and how the Government will work to reduce poverty. Diplomatic personnel, the council and foreign journalists also questioned the new Government's promise of professional, public friendly and non-biased State services as so many state staff lost jobs in the clean sweep at the political and administrative level. They insisted that he explain these faults. There were also some interesting questions posed such as “what do you think if the great Chingis khan lived today, would he want to live in the City instead of countryside?” The representatives from the Councils and journalist also asked how the Mongolian Government would solve the issues around not reopening the Oyu Tolgoi Investment Agreement. ^ top ^


Fabian Eng
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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