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
  25-28.3.2013, No. 468  
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Table of contents

DPRK and South Korea


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Foreign Policy

Xi Jinping gets straight down to business in Moscow (SCMP)
A smiling Xi Jinping stepped off a plane in Moscow [Friday] on his first trip since he was installed as president. Holding his arm was his wife, Peng Liyuan, who was making her first official public appearance as first lady. It marked the start of a hectic two-day visit that highlights Beijing's eagerness to foster closer ties with Russia. […] In talks with Russian President Vladimir Putin at the Kremlin and at a press conference later, Xi said that he and Putin are good friends who always speak in a good manner and "treat each other with an open soul". He called on the two countries to enhance mutual political support, help each other in their efforts to defend their territorial integrity and security, and step up co-operation on regional and international issues. "Our two countries share a similar stance on many issues," Xi said at the press conference. "Our two countries will promote a just and fair international order, the peaceful prosperity and stability of the world." Putin said he was grateful Xi had made his first foreign trip to Russia, and that Sino-Russian relations were a "very important factor" in world politics. The two sides still have not finalised agreement on a deal which would see Russia supplying the mainland with an annual 68 billion cubic meters of natural gas for 30 years. Xi said only that there was a "breakthrough" in the negotiations, and that bilateral economic co-operation was wide-ranging and comprehensive. Meanwhile, Russia's top oil producer Rosneft signed an agreement to provide supplies to China. En+ Group, parent of the world's top aluminium producer Rusal, said yesterday it had signed a US$2 billion deal with Shenhua Group and China Development Bank to develop coal resources in eastern Russia. Both countries vowed to boost bilateral trade, which rose 11.2 per cent to a high of US$88.2 billion last year. The target is for US$100 billion of trade by 2015. […]. ^ top ^

Japan seeks summit with China over Diaoyus dispute as early as May (SCMP)
Japan would seek a bilateral summit between its prime minister and China's new leaders as early as May as part of efforts to defuse a continuing diplomatic row over disputed islands, Foreign Minister Fumio Kishida said yesterday. Kishida said the meeting could be possible on the sidelines of the annual trilateral summit with China and South Korea, which usually takes place in May. "As for a Japan-China summit meeting, we recognise the importance of communication between national leaders," Kishida said. "We have a three-way meeting with China and South Korea at around May every year … We will seek an opportunity of dialogue at such occasions." But he admitted the details of this year's summit, to be hosted by South Korea, had yet to be finalised. Kishida said China's recent maritime activities and opaque military build-ups were major regional threats, which emphasised his earlier claims that there is no territorial issue to be resolved concerning the Japanese-administered islands in the East China Sea and that it is essential to strengthen Japan's alliance with the US. Japan's hawkish Prime Minister Shinzo Abe has had no summit meetings with Chinese leaders since he took power in December amid a diplomatic row over the islands, known in Japan as the Senkakus and in China as the Diaoyus. A report on Friday said Abe would send Deputy Prime Minister Taro Aso to Beijing next month in what would be the first high-level meeting of the Asian powers' new governments. Japan's Sankei Shimbun daily said on Friday that Aso planned to meet President Xi Jinping and Premier Li Keqiang. But a spokesman for the Chinese Ministry of Foreign Affairs, Hong Lei, later said the media reports were not accurate. During a meeting with Japanese businessmen on Friday, Vice-President Li Yuanchao, while being described by Japanese media as striking a softer tone, said Sino-Japanese relations were in an unprecedented "confusing" state and both sides would suffer if this continued. ^ top ^

China, Tanzania issue joint communique on boosting friendly cooperation (Xinhua)
China and Tanzania issued here Monday a joint communiqué on strengthening friendly cooperation between the two countries. The document was released after talks between visiting Chinese President Xi Jinping and his Tanzanian counterpart Jakaya Mrisho Kikwete. In the communiqué, the two countries applauded their traditional friendship, and agreed to build and develop a comprehensive partnership of mutual benefit and win-win cooperation, with a series of celebrations planned to mark the 50 years of their diplomatic ties next year. They also pledged to strengthen political mutual trust, enhance practical cooperation, promote people-to-people friendship and achieve common development. China and Tanzania pledged to support each other on issues concerning sovereignty, territorial integrity, stability, development and other core national interests. Tanzania reaffirmed its commitment to the one-China policy and support for the efforts of the Chinese government to promote national reunification. On economic cooperation and trade, the two countries agreed to further strengthen cooperation in trade, investment, infrastructure construction, agriculture, telecommunications and other areas. The Chinese government will continue to provide assistance to Tanzania within its capability, facilitate the investment of competitive Chinese enterprises in Tanzania, and encourage Chinese financial institutions to actively explore the possibility of providing financing support for Tanzania's infrastructure construction, according to the communiqué. The two sides expressed their readiness to further expand people-to-people exchanges, enhance exchanges and cooperation in education, culture, science and technology, health, tourism and press, and to promote closer contacts between youths, women, people's organizations and academic institutions. The Chinese side will set up a China Cultural Center in Tanzania. They agreed to enhance cooperation in international affairs and strengthen coordination and collaboration in the United Nations and other multilateral forums to jointly uphold the rights and interests of developing countries. […] The two sides agreed to carry out closer cooperation to fully implement the outcomes of the Fifth Ministerial Conference of the Forum on China-Africa Cooperation and promote further development of the new type of strategic partnership between China and Africa. During his visit, Xi also met with Ali Mohamed Shein, president of Tanzania's Zanzibari Government of National Unity, and former Tanzanian President Benjamin William Mkapa. […]. ^ top ^

Xi maps out Africa blueprint (Global Times)
Chinese President Xi Jinping Monday vowed to strengthen Sino-African ties and continue providing no-strings-attached aid to the African continent, during a state visit to Tanzania, the second leg of the leader's first overseas trip. The thoughts on Sino-African relations laid out in Xi's speech have been interpreted as a blueprint for China's Africa policies in the coming decade, as the country has just completed its leadership transition. […] Xi said Sino-African relations now stand at a new historical starting point, vowing that under the new circumstances, the importance of bilateral ties and shared interests would increase, not shrink, and China would intensify rather than weaken relations with Africa. "Unity and cooperation with African countries have always been an important foundation for China's foreign policy. This will never change, not even when China grows stronger and enjoys higher international status," Xi said. "With the growth of its economic and overall strength, China will continue to offer, as always, necessary assistance to Africa, with no political strings attached," the president vowed. He said China will provide a $20 billion credit-line to the continent over the next three years. Liu Guijin, China's former special envoy for African affairs, told the Global Times on Monday that the president's speech indicated continuity in China's Africa policy, while there will be some fine-tuning to adapt to new challenges, especially on the security front. "Africa belongs to the African people. In developing relations with Africa, all countries should respect Africa's dignity and independence," Xi said. Under the precondition of "no intervention in internal affairs," China may extend its assistance by training African peacekeepers, providing weaponry and contributing more to the African Union (AU) Peace Fund, said Liu, describing the policy as more "flexible." It would also support the AU and other sub-regional organizations to play a bigger role in maintaining peace and stability on the continent, and speak for Africa in the international arena, he added. During the speech, Xi also highlighted China's cooperation with Africa in business and trade. He said the Sino-African trade volume approached $200 billion in 2012, and saw more than 1.5 million mutual visits between the two sides during that period of time. By the end of last year, China's accumulated direct investment in the continent surpassed $15 billion. However, China's expanding investment and influence in Africa has triggered concerns both in and outside the continent, with the West accusing it of pursuing "neocolonialism" and grabbing resources from African countries. Responding to the accusations, Liu acknowledged that the current structure of Sino-African trade is not satisfying, but noted that it is a problem that also existed in Africa's trade with Europe and the US, in which African countries mainly exported resources and imported finished goods. As Africa is now the world's fastest-growing market, developed economies are gradually shifting their focus to tap into the consumer market there, bringing more competition to Chinese businesses. Liu perceived the competition as a good thing for Africa, which would bring more options for the continent. "Our cooperation is equal, mutually beneficial and not exclusive," he said. Chen Yulai, a researcher with the Institute of West Asian & African Studies at the Chinese Academy of Social Sciences, told the Global Times that Chinese enterprises do have a competitive edge in the market given the good foundation laid in past decades; however, they face more challenges now. "Some Chinese enterprises are short-sighted and only focus on profits. They pose a threat to long-term relations between China and Africa," warned Chen. Xi and his Tanzanian counterpart Jakaya Kikwete signed more than a dozen trade and cooperation deals. According to Reuters, the agreements included plans to co-develop a new port and industrial zone complex, a concessionary loan for communications infrastructure and an interest free loan to the Tanzanian government. ^ top ^

Nations sign arms-sale pact (China Daily)
Beijing and Moscow signed two arms-sale contracts in which China will buy Russian fighter jets and submarines, media reports said. The deals, for 24 Su-35 fighters and four Lada-class submarines, raised concern among some regional players and media. Chinese observers said the reaction was "unnecessary" because the purchase is not directed at any third party. China Central Television reported on Sunday that the purchase deals were signed before President Xi Jinping's just-concluded visit to Russia. The purchases represented "the first time in nearly 10 years" that China had bought large military technological equipment from Russia, the report said. The four submarines will be jointly designed and built by both countries, with two of them to be built in Russia and the other two in China. "The Su-35 fighters can effectively reduce pressure on China's air defense before Chinese-made stealth fighters come online," the report said. Li Hong, secretary-general of the China Arms Control and Disarmament Association, said the recent purchases and joint building plan serve as an indicator of the evolution of the overall Sino-Russian strategic partnership. […] As for some countries and their speculation on the intentions behind the arms deals, Li said China is not the only country that has signed big arms deals with Russia recently. Geng Yansheng, a spokesman of the Ministry of National Defense, said last month that Sino-Russian cooperation on military technology is not directed at a third party, and that it will facilitate peace and stability in the world and the region. The enhanced agenda of bilateral defense cooperation also has seen Xi, who is also chairman of the Central Military Commission, visit Russia's Defense Ministry on Saturday. Xi is the first Chinese head of state to have made the tour, and he said the idea of visiting the ministry was proposed by Russian President Vladimir Putin. The world is still unequal, unbalanced and tumultuous, with challenges of both "traditional and nontraditional" threats, as well as the further spreading of turmoil in some areas, Xi said. China and Russia, in the face of complicated international situation, should strengthen their coordination, and work with the international community to deal with all kinds of challenges and threats, he said. […] On Sunday, Chang Wanquan, Chinese State councilor and defense minister, said during a meeting with Russian Defense Minister Sergei Shoigu that wide-ranging and multilayer defense cooperation has become a cornerstone of the China-Russia comprehensive strategic partnership. "Given the complex international scenario today, China-Russia strategic cooperation and coordination will not only benefit the two peoples, but also help promote world peace and stability," he said. Shoigu, for his part, hailed the "unprecedented high level" of the Sino-Russian strategic partnership. The consensus reached by the top leaders has shown the direction of future development of bilateral ties, he said. ^ top ^

Beijing hits back at Vietnam over trawler 'attack' (SCMP)
Beijing defended its actions after Vietnam protested about an incident in which a Chinese ship fired on one of its fishing vessels last week in a disputed area of the South China Sea. "It is necessary and legitimate for China to take action against the Vietnamese fishing boat that entered the waters of China's Paracel Islands for illegal fishing," Foreign Ministry spokesman Hong Lei said at a briefing yesterday. He added that the boat was not damaged. "We urge the Vietnamese side to take effective measures to enhance the education and management of their own fishermen so as to stop such illegal activities," Hong said. The Defence Ministry in Beijing denied any PLA vessel had fired at the Vietnamese boat, and said this was nothing more than "a groundless accusation". A statement on its website quoted a PLA Navy official as saying that a patrol vessel had fired two flares as a warning, after failing to drive boats away from Chinese waters. China's claim to almost all the South China Sea has set it directly against US allies Vietnam and the Philippines. Brunei, Taiwan and Malaysia also claim parts of the waters. China is also involved in a separate dispute with Japan in the East China Sea. A statement on the Vietnamese government's website said the trawler was chased away and came under attack from the Chinese vessel near the Paracel Islands on March 20. It described the incident as a breach of international maritime law. Vietnam's state-controlled newspapers published photos of what they said were the charred remains of the ship's cabin. "This is a very serious case, violating Vietnam's sovereignty," the Foreign Ministry said. Vietnam's condemnation of China's claims in the South China Sea was the strongest since early December, when it accused Chinese ships of sabotaging an exploration operation by state oil and gas company, Petrovietnam by cutting a seismic cable. Meanwhile, Beijing said yesterday that a fisheries patrol boat had been sent to the Paracels and Scarborough Shoal - known in China as Huangyan Island. ^ top ^

BRICS summit kicks off in Durban (Xinhua)
The fifth BRICS summit opened in Durban, South Africa, Tuesday night with President Jacob Zuma hosting a banquet for his counterparts of the five-member grouping and African heads of state and government at the special invitation. The theme of the summit is: BRICS and Africa: Partnership for Development, Integration and Industrialization. Chairpersons of all African regional economic blocs and the New Partnership for African Development are expected to participate in the BRICS leaders-Africa Dialogue Forum on Wednesday under the auspices of the African Union, amid greater recognition of and greater interaction with regional institutions on the continent. They will join Zuma and Presidents Dilma Roussef of Brazil, Vladmir Putin of Russia and Xi Jinping of China and Prime Minister Manmohan Singh of India. Among other things, BRICS leaders will endorse an agreement by their finance ministers to establish a BRICS development bank, which will finance infrastructural development within the five emerging economies. If it expands to include other nations, it will provide an alternative source of funding from the International Monetary Fund and World Bank. The summit is expected to assert BRICS as a growing but already influential force in global economics, governance, peace and security, which it will tackle in the face of political problems in countries like Syria, which has since asked BRICS to assist find a political solution. […] Two agreements between China and Brazil and 10 between South Africa and Russia were signed Tuesday. The first between China and Brazil were a Memorandum of Understanding on Bilateral Cooperation in Macroeconomic, Fiscal and Financial Policies and the second one was a currency swap agreement to broaden access to financial resources between the two countries whenever the need arises. […]. ^ top ^

China, South Africa to prioritize bilateral ties in foreign policies (Xinhua)
China and South Africa agreed on Tuesday to prioritize bilateral relationship in their respective foreign policies and called for a more equal and balanced global partnership for development. "Both leaders agreed to make the bilateral relationship a strategic focus and priority in their respective foreign policies," said a joint communique released after a meeting between visiting Chinese President Xi Jinping and his South African counterpart Jacob Zuma. Acknowledging the bilateral relationship is among the most vibrant and important relationships each country has, the two leaders pledged to take the comprehensive strategic partnership between the two countries to new heights. To achieve this, the two sides agreed to further expand and deepen political, economic and trade cooperation, people-to-people and cultural exchanges as well as coordination and communication in regional and international affairs. […] On the international front, China and South Africa vowed to uphold the legitimate rights and interests of developing countries and make the international order and system fairer and more equitable. "The two sides appealed to countries all over the world to establish a more equal and balanced global partnership for development, and address global challenges through unity and cooperation for mutual benefit," the joint communique said. Meanwhile, the two sides called on the international community to pay more attention to and provide greater support for Africa, respect African countries' efforts to solve regional issues on their own, and help them enhance capability for self-generated growth. […]. ^ top ^

BRICS seals development bank deal (Global Times)
BRICS nations Tuesday agreed to set up a development bank, as part of the emerging economies' efforts to reshape the existing international political and economic system. The creation of the bank was announced by South Africa's finance minister Pravin Gordhan hours before Tuesday's summit of the BRICS, which groups Brazil, Russia, India, China and South Africa, in the South African port city of Durban, without revealing details. The bank is expected to provide loans for infrastructure construction in the developing world. AFP commented that it is the first time since the inaugural BRICS summit four years ago that the group has matched rhetorical demands for a more equitable global order with concrete steps. Fan Yongming, director of the Center for BRICS Studies at Fudan University, told the Global Times that the establishment of the development bank marks a step forward in the institutionalization of the group's mechanisms. BRICS is also mulling the creation of its own business council and think tank. […] However, despite the emerging countries' desire to reshape the international order, their ability to do so has been brought into question, especially after seeing slowed economic growth in the past year or so. Su Hao, director of the Asia-Pacific Research Center at the China Foreign Affairs University, told the Global Times that the five countries, which all aimed to build a multipolar world order, now have some political weight, but not in a decisive manner. "They are pushing for changes slowly and incrementally. We can only expect it to be a long-term process," said Su. In recent months, some opinions from the West have cast doubt over whether the emerging countries could maintain their prospects. Fan expressed confidence in the group, noting that the West's expression of pessimism was due to their concerns that the BRICS's desire to change the political order would challenge their interests. "We have every reason to believe that the BRICS would maintain their momentum despite the pessimism." […]. ^ top ^

Beijing in push for free trade deal with Japan, South Korea (SCMP)
Long-awaited talks on a free trade deal involving China, Japan and South Korea opened yesterday. And while tensions, rivalries and suspicions cloud their relations, Beijing is keen to counter US initiatives in the region. Washington's push for a Trans-Pacific Partnership (TPP) has so far excluded China. "To strengthen its economic ties and counter the US-initiated TPP, China is eager to push the regional free trade agreement with Japan and South Korea, and the ongoing talks on the China-Asean Free Trade Area," said Shi Yinhong of Renmin University. The idea of a trilateral free trade agreement has been on the table for years. With all three countries under new leadership, officials hope they can move beyond damaging territorial disputes that have dogged relations for decades. China, Japan and South Korea are now the largest, second-largest and fourth-largest economies in Asia, with trade volume between them totaling US$690 billion in 2011. Analysts in Japan said the biggest winner of a trade deal would be South Korea, while Japan was taking part largely to avoid increasing regional tensions. New Japanese Prime Minister Shinzo Abe also announced earlier this month that his country would be participating in TPP negotiations with Washington. Noriko Hama, a professor of economics at Kyoto's Doshisha University, said of a new three-way trade deal: "I don't think it will be of much benefit to Japan, but the difficulty for this government is that it has to be seen to be taking part, irrespective of whether it is in our best interests. To turn our back on these talks would send the wrong image to China and South Korea that Japan is totally on the side of the US." China and Japan are arguing about sovereignty over an archipelago in the East China Sea, while Japan and South Korea have a historic dispute over the ownership of several islands. Tokyo is also focusing on Europe. On Monday it agreed to open talks with the European Union on a trade pact that could come into effect next year. Meanwhile, both Seoul and Tokyo could face intense domestic lobbying from sectors wary of a flood of cheap Chinese imports. But Beijing is upbeat about a pact. Xinhua said it could lift China's GDP by up to 2.9 per cent, Japan's by 0.5 per cent and South Korea's by 3.1 per cent. South Korean officials were quick to dampen expectations, casting the opening talks between trade ministers in Seoul as "meetings about meetings". The first round would "involve no practical negotiations", one official said. He added: "It will cover broad matters such as the scope, agenda and procedure for further negotiations." But an agreement on a fully fledged pact may not come easy. "There are all sorts of things that could derail any agreement," Professor Hama said, referring to China's refusal in 2010 to release rare earth metals to Japan and other countries after a diplomatic spat stemming from an incident with Japan in the East China Sea. […] Talks are being held in Seoul until tomorrow, after which they will move to China followed by a third round in Japan. ^ top ^

CPC leader meets Mongolian guests (Xinhua)
Senior Communist Party of China (CPC) leader Liu Yunshan on Wednesday met with a delegation of the Mongolian People's Party led by its chairman Ulziisaikhan Enkhtuvshin. Liu, a member of the Standing Committee of the Political Bureau of the CPC Central Committee, said the principles of commitment, cooperation and sincerity highlighted by President Xi Jinping during his ongoing Africa trip can also be applied to China-Mongolia relations. China highly values its strategic partnership with Mongolia and appreciates the contributions made by the Mongolian People's Party in fostering bilateral ties, Liu stressed. China is willing to work with all major Mongolian political parties to turn the results of bilateral cooperation into common prosperity that can benefit the two peoples, Liu said. Enkhtuvshin said the Mongolian People's Party attaches great importance to its ties with China and the CPC, vowing to continue to make efforts to boost bilateral cooperation. Wang Jiarui, vice chairman of the National Committee of the Chinese People's Political Consultative Conference and head of the International Department of the CPC Central Committee, also attended the meeting. ^ top ^

Factbox: Bilateral currency swap hastens yuan internalization (Xinhua)
The People's Bank of China (PBOC) signed a bilateral currency swap agreement on Tuesday with the central bank of Brazil to strengthen economic ties and avert financial risks. The agreement, which is expected to alleviate over-reliance on U.S. dollars in bilateral trade, will bring down transaction costs and prevent risks resulting from fluctuations in currency rates for enterprises from both countries. The amount specified in the agreement is 190 billion yuan (30.29 billion U.S. dollars), or 60 billion Brazilian real, with an effective period of three years. The move marks the first agreement of its kind within BRICS and is an important step in internalizing the yuan, China's currency. China has made similar agreements with more than 20 countries, including the Republic of Korea, Malaysia and New Zealand, with total capital amounting to over 1 trillion yuan. [...]. ^ top ^

BRICS summit delivers tangible results, forum pledges to promote partnership with Africa (Xinhua)
The leaders of five major emerging economies on Wednesday wrapped up their latest round of summit in the South African city of Durban to promote their partnership for development, integration and industrialization. […] While addressing the summit in his keynote speech, Chinese President Xi Jinping called on all BRICS members to work hand in hand for common development. He pledged that China would strengthen cooperation with other members to make economic growth of BRICS countries more robust and their cooperation better-structured and more productive. BRICS cooperation not only brings benefits to the peoples of the five countries, but also contributes to promoting democracy in international relations, Xi said. He said all members should manage their own affairs well by growing the economy and improving people's lives, strengthen coordination of macroeconomic policies, reform the international monetary and financial systems, and promote trade and investment liberalization and facilitation. They should jointly participate in the setting of international development agenda and make global development more balanced, he said. BRICS countries should work hard to boost cooperation in economy and trade, finance, infrastructure, movement of people and other fields, Xi said. He also called for improving global economic governance and increasing the say and representation of BRICS countries, and urged the BRICS nations to move toward the goal of integrated markets, multi-tiered financial network, connectivity by land, air and sea, and greater cultural exchanges. At the summit, the five BRICS members have achieved a number of tangible results, and agreed to expand their future cooperation to more sectors, according to a statement issued after the meeting. The most tangible outcomes, among others, is that the leaders have agreed to establish a development bank for mobilizing resources for infrastructure and sustainable development projects in the BRICS, as well as other emerging and the developing nations. The BRICS leaders believed that the bank serves as a supplement to the existing efforts of multilateral and regional financial institutions for global growth and development, adding that the initial contribution to the bank should be sustainable and sufficient. Meanwhile, the members also agreed to explore the construction of a financial safety net through the creation of a Contingent Reserve Arrangement (CRA). […] In the statement, the countries also expressed their common aspiration to improve global economic governing system. The leaders vowed to reform international financial system to make them more representative and to reflect the "growing weight" of the BRICS and other developing nations, adding that the leadership selection of international financial institutions should be open, transparent and merit-based. Additionally, the BRICS nations would explore the possibility of strengthening their cooperation between their state-owned firms, and promote the dialogues among the small and medium-sized companies. They would also consider to expand their cooperation to more sectors including public diplomacy, anti-corruption, drug control, youth exchanges, tourism, energy and sports. […] The Chinese leader also reaffirmed China's promise to give zero-tariff treatment to 97 percent of the tariff items of exports to China from the least developed nations having diplomatic ties with China. Other leaders of the BRICS nations said the BRICS countries would like to forge a cooperative partnership with Africa, and help Africa in constructing its infrastructure. The African leaders said Africa needs to strengthen its infrastructure, promote integration and industrialization, and lift over-all competitiveness and the capacity for sustainable development. The African nations are willing to set up with the BRICS members a cooperative partnership that highlights mutual support, mutual benefit and win-win results, said the leaders. ^ top ^



Domestic Policy

China Voice: House prices thwarts common people's "China dream" (Xinhua)
Soaring house prices are gnawing away at common people's "Chinese dream," of a home, fairness and happiness. A house is a must for many Chinese to build a family and lay down their roots. The fact is, though China's house price growth rate has kept falling in the past five years, the average house price has climbed to a level hard to bear for most people, especially for those in their 20s or 30s. High house prices is affecting healthy economic development, creating a sense of unfairness and impairing people's confidence in the government. At the conclusion of the annual parliamentary session last weekend, new Chinese President Xi Jinping said all Chinese people deserve common opportunities of realizing their dreams and enjoying a wonderful life. Premier Li Keqiang also said during the session that the government should ensure fairness and equal opportunities for its people. Everyone, in spite of their family backgrounds, will benefit if they put in the effort, he said. Earlier this year, the Chinese government put its 2013 GDP growth, which to a large extent is driven by real estate, at around 7.5 percent. New measures have also been meted out to limit investment-oriented housing purchases. But huge pressure remains for the re-installed housing minister Jiang Weixin. Definitely it is not a wise way for the government to immoderately cash in on land, which will further push high house prices and overdraft China's future. But it is feasible to rationally make use of land, such as advance the low-income housing project, which will increase employment and relieve many people's property hardship. Never stop regulating and controlling house prices, and concentrate on building a happy human habitation, that is a way to realize the coordinated progress of the economy and people's well-being. ^ top ^

Li focuses on consumption (China Daily)
Premier Li Keqiang said on Monday that China is likely to import as much as $10 trillion worth of commodities and services in the next five years to boost domestic consumption. Li renewed the nation's pledge to maintain its open policy, and promised a further opening up of services and industries related with energy-saving and environmental protection. In response to concerns expressed by multinational companies about the investment environment, Li also pointed out that the government will ensure foreign businesses fair access to the market and a level playing field in terms of competition. […] "China will expand its opening-up policy, and the nation needs to promote domestic consumption through continuing to open up its markets," Li said in his closing remarks. The nation will prioritize opening up its service sector to foreign companies, he said. "It (opening-up) has to be realized step-by-step." Energy-saving and environmental protection are other key areas where domestic companies lag behind their foreign peers and requires "cooperation" with them, he added. At the first press conference after taking up his post earlier this month, the newly elected premier said the highest priority for China is to maintain sustainable economic growth and he pledged to advance economic reform including tapping the potential of domestic demand. As part of the 12th Five-Year Plan (2011-15), the government has vowed to expand domestic consumption to help the nation transform its economic growth model away from an overreliance on exports. China is facing two unprecedented transformations. One is for a nation of 1.3 billion people to complete its modernization process. The other is the challenge that it has to address and implement policies that will ensure this, especially concerning climate change, green development and environmental protection, said Li. Vice-Premier Zhang Gaoli said on Sunday at the opening of the forum that China will "deepen its reform and opening-up policies with greater courage and more wisdom" even with increasing downward economic pressures. Sustaining robust economic growth is a major concern, said analysts. A GDP growth target of 7.5 percent was set for this year. On the way to maintaining sustainable economic growth, China is facing "huge opportunities and complicated and severe challenges," and "we have to rely on domestic consumption in the long-term," with "urbanization" being a major contributor to it, Li said. But he pointed out that domestic consumption is, in itself, not enough to stimulate the economy, and "efficient supply" created through the opening-up to foreign businesses is "vital to meet demand". Where Chinese companies lag behind their foreign counterparts, in particular, is service and green industries, he said. The foreign direct investment that helped to transfer technology and create jobs has long been a driver to the economy. China is the second-largest nation worldwide next to the United States as an FDI destination, and has ranked as the most attractive FDI recipient among emerging markets for many years. […]. ^ top ^

China's cabinet announces official appointments (Xinhua)
The State Council, or China's cabinet, on Tuesday announced a number of new appointments for officials in government departments and organizations.
Their names and posts are as follows:

Xiao Jie, deputy secretary-general of the State Council. Xiao will no longer hold the post of director of the State Administration of Taxation.
Ding Xiangyang, deputy secretary-general of the State Council.
Zhang Yesui, vice foreign minister.
Wu Xinxiong, vice minister in charge of the National Development and Reform Commission, and director of the National Energy Administration.
Ma Xingrui, vice minister of industry and information technology and head of the China National Space Administration, the China Atomic Energy Authority and the State Administration of Science, Technology and Industry for National Defense.
Lu Dongfu, vice minister of transport and head of the State Railways Administration.
Jiang Jiemin, chairman of the State-owned Assets Supervision and Administration Commission of the State Council, replacing Wang Yong.
Zhang Yi, vice chairman of the State-owned Assets Supervision and Administration Commission of the State Council.
Wang Jun, director of the State Administration of Taxation, replacing Xiao Jie. He will no longer hold the post of vice minister of finance.
Zhang Mao, director of the State Administration for Industry and Commerce, replacing Zhou Bohua.
Cai Fuchao, director of the State General Administration of Press, Publication, Radio, Film and Television. He was also appointed head of the National Copyright Administration, replacing Liu Binjie.
Jiang Jianguo, deputy director of the State General Administration of Press, Publication, Radio, Film and Television.
Zhang Yong, director of the China Food and Drug Administration.
Huang Shuxian, director of the National Bureau of Corruption Prevention, replacing Ma Wen.
Qiu Yuanping, director of the Overseas Chinese Affairs Office of the State Council, replacing Li Haifeng.
Zhang Zhijun, director of the Taiwan Affairs Office of the State Council, replacing Wang Yi. Zhang, as well as Fu Ying and Cui Tiankai, will no longer hold the post of vice foreign minister.
Xia Yong, deputy director of the Legislative Affairs Office of the State Council.
Xiao Gang, chairman of the China Securities Regulatory Commission, replacing Guo Shuqing.
Xie Xuren, chairman of the National Council for Social Security Fund, replacing Dai Xianglong.
Liu Cigui, director of the State Oceanic Administration and political commissar of the China maritime police administration.
Meng Hongwei, deputy director of the State Oceanic Administration and director of the China maritime police administration.
Chen Lianzeng, Zhang Hongsheng, Wang Fei and Wang Hong, deputy directors of the State Oceanic Administration.
Meng Xiangfeng, director of the National Administration for the Protection of State Secrets, replacing Xia Yong.
Jiang Daming, concurrently State Land Inspector-General, replacing Xu Shaoshi. Jiang is also minister of land and resources.
Zhong Shan, international trade representative of the Ministry of Commerce, replacing Gao Hucheng.
Wang Enge, president of Peking University, replacing Zhou Qifeng.

The State Council also announced the removal of Wang Xuejun from posts of deputy secretary-general of the State Council and director of the State Bureau for Letters and Calls. ^ top ^

Chinese premier urges countering corruption by deepening reform (Xinhua)
Premier Li Keqiang on Tuesday said corruption should be prevented by deepening related reforms. Li made the remarks at the first anti-corruption work conference held by China's cabinet. The government should accelerate reform in marketization of public resource trade and improve related rules and legal systems to restrain government power, Li said. Li said the government will transform government functions and delegate power to lower levels of government in order to activate social vigor and creativity. "The government should not do the work that is supposed to be done by the market. That would be a weakening or even a dereliction of government duties," Li said. ^ top ^

Chinese premier specifies government tasks for 2013 (Xinhua)
Premier Li Keqiang specified key tasks for the government to accomplish this year on Wednesday. A total of 48 key tasks in six categories were declared and distributed to corresponding departments at an executive cabinet meeting chaired by Li. All departments should closely follow and analyze economic situations at home and abroad in a bid to stabilize growth, fight inflation, guard against risks and boost China's economic transition, according to the meeting. More efforts should be made to facilitate rural growth and ensure plentiful harvests, while long-term urbanization layouts should be mapped out with better accessory policies, according to the meeting. Industrial restructuring should also pick up speed and different sectors should propose concrete methods to tackle production overcapacity. Fiscal and taxation reforms should follow programs in a gradual way. Financial reforms will demand new measures to boost the marketization of interest rates and foreign exchange rates, as well as to develop multi-layer capital markets, according to the meeting. The key for price reforms will be to upgrade the pricing mechanism for resource products. And ensuring and improving people's livelihoods is the initiative and goal of the government. New jobs must be added by stabilizing economic growth and adjusting economic structures, while the key to improving social security will be to tackle problems faced by disadvantaged groups, according to the meeting. Market controls for the property sector should be maintained and improved, while a long-term mechanism should be built to ensure the sector's stable and healthy growth. Oversight systems must be upgraded for better food, drug and production safety, while special measures should be taken in key regions to fight pollution of the air, water and soil. Fairness is a source of social creativity and more efforts should accordingly be made to achieve equality in education and job markets in order to ensure vertical mobility, according to the meeting. Education departments should make good use of the country's 2 trillion yuan (318.98 billion U.S. dollars) education budget this year. In addition, the admission threshold for the non-governmental investment market should be lowered, according to the meeting. ^ top ^

1.1 tr yuan in economic losses from pollution in 2010, China report says (SCMP)
The mainland is paying an increasingly heavy price for rampant pollution, with direct economic losses more than doubling between 2004 and 2010, a recent government-backed study has found. An incomplete calculation of the environmental costs in 2010 showed that pollution had caused 1.1 trillion yuan (HK$1.36 trillion) in economic losses, or 2.15 times the 511.8 billion yuan loss in 2004, when the "green GDP" project was launched. The direct cost of pollution accounted for 2.5 per cent of total economic output in 2010, but if damage to the ecosystem - including forests, wetlands and grasslands - was included, the losses added up to 1.54 trillion yuan, or 3.5 per cent of that year's gross domestic product. The cost of pollution also grew more rapidly than GDP in 2010, up 13.7 per cent compared with GDP growth of 10.4 per cent. The latest update of the study, led by the Ministry of Environmental Protection's Chinese Academy of Environmental Planning, was quietly posted on the academy's website in January, when about a seventh of the mainland was shrouded in smog. It said the findings were incomplete due to lack of data in some areas. Aimed at putting a price tag on the mainland's runaway economic growth, the study has been stubbornly resisted by local governments because the findings could tarnish their political achievements. As a result, the academy had only previously released figures for 2004 and 2008, even though the study is conducted annually. […] A government-sponsored report released in 2006 said air pollution caused 358,000 premature deaths in 600 mainland cities each year, with an estimated health cost of 152.7 billion yuan. The World Bank estimated in 2007 that the health costs of air and water pollution equalled 4.3 per cent of the mainland's GDP. Premier Li Keqiang has pledged that the country will not pursue economic growth at the expense of the environment, saying "such growth won't satisfy the people", but has yet to release details of his planned remedy. Professor Li Wei, from Beijing Normal University, said the "green GDP" project's findings should serve as a wake-up call for local governments and officials, and prompt them to reconsider their economic growth targets. China Environmental News, the ministry's daily, said on Tuesday that the project might have regained momentum. ^ top ^



Illegal human embryo clinic busted in Beijing (SCMP)
Police and various regulators in Beijing cracked down on a medical group claiming to be from Hong Kong yesterday that had grown almost 300 human embryos a year in test tubes for surrogate mothers without approval from authorities, the Beijing Health Bureau confirmed online. An official investigation into the illegal clinic was triggered when authorities received accounts from undercover reporters at China Central Television, which aired its report yesterday after the joint raid was conducted that morning by police and health, food and drug regulators. The illegal clinic, located in downtown Beijing but calling itself the "Hong Kong Fuchen Group", had been operating without a licence for six years, providing reproductive assistance to couples, and for the last four years they had grown about 300 embryos annually, according to Song Hongbo, a salesman for the group who was quoted by investigative reporters posing as an interested couple. It was unclear if the group had any real ties to Hong Kong. "We are registered as a hospital, but we do not have any qualifications to conduct this assisted reproductive technique," Song said. The downtown office served mainly to sign people up for the service, which was then conducted at a separate and undisclosed clinic. While assisted reproductive techniques are allowed to be carried out only in approved hospitals, the use of in-vitro fertilisation technology to implant embryos into surrogate mothers is banned in China. The company had been openly recruiting egg donors and surrogate mothers online, with a promise payment of hundreds of thousands of yuan. When the undercover reporters asked why the group had "Hong Kong" in the name, despite the group's president reportedly being from Suihua, Heilongjiang province, Song told them: "There are a lot of fake things in this business - even the names." The statement by the Beijing Health Bureau, posted on its official Sina microblog, said the group was actually called the Beijing Zhuoyue Medical Beauty Clinic, and it was licensed to conduct cosmetic treatments, but it stealthily conducted in-vitro fertilisation and surrogacy services. A list of surrogate mothers and payment records were also found in the clinic. The whole process reportedly cost 1 million yuan (HK$1.24 million), or 1.2 million if a couple insisted on having a boy. Surrogate mothers would receive 170,000 to 230,000 yuan. ^ top ^



Tibetan mother of 4 self-immolates (SCMP)
A US-backed broadcaster says a Tibetan mother of four young children has killed herself in the latest self-immolation protest in western China. Radio Free Asia said 30-year-old Kalkyi set herself on fire on Sunday near a monastery in Sichuan province's Aba county. The report said she died at the scene and her body was placed in the nearby Jonang Tibetan Buddhist monastery. Aba has seen the largest number of the 110 such protests that have occurred starting in 2009. Tibetan rights advocates say the self-immolations aim to protest against Chinese rule and call for the return of exiled spiritual leader the Dalai Lama. China accuses the Dalai Lama's supporters of encouraging the suicides. ^ top ^

Lhasa TV launches Tibetan-language channel (Xinhua)
Lhasa TV in southwest China's Tibet Autonomous Region launched a Tibetan-language channel on Tuesday. "Lhasa TV finally has its own Tibetan-language channel," said Tenzin Jigme, editor-in-chief at the station. Many rural Tibetans can't understand standard mandarin Chinese, he said. In Tibet, over 80 percent, or roughly 2 million Tibetan farmers and herders, choose to watch Tibetan-language TV channels. "Now there are more TV channels for them to watch. They'll enjoy it," Tenzin Jigme said. The channel broadcasts news, entertainment shows and soap operas. The new Tibetan-language channel, on air 14 hours a day, will feature three major Tibetan tongues -- the Lhasa, Amdo and Kamba dialects. In 2012, Lhasa TV broadcast just 200 hours of Tibetan-language programming, with news accounting for 90 percent of that. However, its broadcasting in Tibetan will now reach 5,000 hours annually, according to Tenzin Jigme. Also on Tuesday, Lhasa TV launched a third channel on culture and travel to introduce the city's culture and scenic spots. ^ top ^

Tibetan envoy says China can end immolations (SCMP)
An envoy of the Dalai Lama said on Wednesday that Tibetans would likely end a wave of self-immolation protests if China re-opened dialogue with the exiled spiritual leader to address grievances. More than 110 Tibetans have set themselves alight, with most of them dying, in demonstrations since 2009 against what they see as China's oppressive rule. China has since ramped up its security presence in Tibetan areas. Lobsang Nyandak, the Dalai Lama's representative to the Americas, said that China should resume dialogue with the spiritual leader's envoys. China held nine rounds of dialogue between 2002 and 2010 with no tangible results. “I believe, definitely, if China is to engage His Holiness's representative envoys and come up with a positive gesture, then it's almost certain that Tibetan people will - at least for the time being - watch and see what's really going to happen,” Nyandak said. “We always say that it's up to the Chinese leaders whether they want to put an end to the self-immolations in Tibet,” he said. “But the way that they can put an end is not out of further intensifying repression in Tibet, but through engaging His Holiness's representatives in a very positive manner,” he said. Nyandak was addressing a Washington meeting of the pro-democracy group Initiatives for China, part of efforts by the exiled Tibetan leadership to reach out to sympathetic members of China's ethnic Han majority. Chinese officials have accused the Dalai Lama of encouraging violence through the self-immolations. Beijing rejects criticism of its rule, pointing to economic development of Tibet. The Dalai Lama, a Nobel Peace laureate who has lived in exile in India since 1959, has described the self-immolations as spontaneous acts of desperation and said he is powerless to stop them. Nyandak said that the protesters sought “freedom and happiness” inside Tibet, despite a Buddhist taboo over suicide. “It's sure that the overwhelming majority of the Tibetan people both inside and outside Tibet have so much great admiration, respect for those self-immolators,” Nyandak said. In the latest protest, US-based Radio Free Asia reported that a Tibetan mother of four burned herself to death in southwestern China's Sichuan province on Sunday. ^ top ^



20 jailed for 'inciting secession' in Xinjiang (SCMP)
Twenty Uygur men in Xinjiang have been sentenced to terms of up to life imprisonment for involvement in terrorism and "inciting secession" in the ethnically divided western region, state media said. The men were convicted of a series of crimes, including circulating religious extremist material and attempting to set up an internet chat room to promote "ethnic separatism", the Tianshan news website said. The local government mouthpiece also said the men were accused of spreading information about the East Turkestan Islamic Movement, which is considered a terrorist organisation by Beijing, the United States and the United Nations. One of the men was accused of attacking "innocent people" and smashing cars, motorbikes and other property, it said on Tuesday, after the men were sentenced. An official in the Xinjiang region's publicity office said yesterday that it had no details of the case, while the local court and police were unavailable for comment. Xinjiang is home to some nine million Uygurs, many of whom complain of religious and cultural repression by the authorities - accusations the government denies. The sentences were yesterday branded as "repressive" by an overseas Uygur group. "It is a specific repressive tool of the Chinese authorities to suspect a Uygur of terrorism and to hand them a heavy sentence," Dilxadi Rexiti, a spokesman for the exiled World Uygur Congress, said in an e-mail. Sources told the organisation that the men were detained after they listened to Uygur-language programmes on US-based Radio Free Asia and downloaded videos from the YouTube website. "They also used the internet to discuss religion and the importance of protecting ethnic culture and traditions," Rexiti said. Xinjiang has been under strict security since July 2009, when bloody ethnic riots broke out in the capital Urumqi that killed 200 people, the government claimed. The violence was sparked by clashes between Han and Uygur workers at a factory in Shaoguan, Guangdong. ^ top ^



Opponents of Beijing ineligible to be CE: top Chinese official (SCMP)
A top mainland official yesterday set the tone for the debate over Hong Kong's political reform by declaring that any members from the opposition camp who insist on confronting the central government cannot become the city's chief executive. Despite declaring Beijing's "unswerving" commitment to universal suffrage by 2017, Qiao Xiaoyang, chairman of the Law Committee under the National People's Congress, also dropped the most significant hint so far about a screening mechanism being introduced ahead of the chief executive poll in 2017. Qiao made the remarks in a closed-door seminar on the Basic Law, Hong Kong's mini-constitution, attended by almost 40 pro-establishment lawmakers in Shenzhen yesterday. In the meeting - attended by the director of the State Council's Hong Kong and Macau Affairs Office, Wang Guangya, and the director of the liaison office in Hong Kong, Zhang Xiaoming - Qiao said the central government insisted that it was committed to Hong Kong achieving universal suffrage by 2017 in accordance with the Basic law. It was "also unswerving that chief executive candidates must be persons who love the country and love Hong Kong, while the methods in the universal suffrage must match with the Basic Law and the decisions by the NPC Standing Committee", he said. In a rare elaboration, Qiao admitted it would be difficult to write into law criteria for the "love country, love Hong Kong" notion, but those "who confront the central government" would fail to qualify, he said. This would be decided in three steps. "Firstly, the nomination committee will decide. Then the voters in Hong Kong will decide. Lastly, the central government will decide whether to appoint [the candidate] or not. Every person has a scale in their hearts," Qiao said. He then referred to the opposition camp, an apparent reference to pan-democrats, and ruled them out of the race. "As long as they insist on confronting the central government, they cannot become the chief executive," he said. "One day, when they give up going against the central government, and prove by their actions they will not harm the interests of the country and Hong Kong, the door is open for them." A lawmaker who attended the meeting said Qiao cited at least one article written by former Democratic Party chairman Albert Ho Chun-yan, who stood against Leung Chun-ying for chief executive in 2012. In an article published in a Chinese-language newspaper, Ho called for an end to one-party rule. Qiao said candidates had to be nominated by a newly formed nominating committee "as a whole", instead of by individual committee members, as in previous chief executive elections. Pan-democrats said Qiao's explanation paved the way for a screening mechanism ahead of the chief executive poll. ^ top ^

Qiao Xiaoyang says Beijing forced into universal suffrage debate (SCMP)
It should come as no surprise to Hongkongers to see Qiao Xiaoyang, a top National People's Congress official, setting the tone for the debate on the city's political reform even before the government kick-starts the consultation on how to elect the chief executive by universal suffrage in 2017. Qiao, the chairman of the Law Committee under the NPC Standing Committee, told almost 40 pro-establishment lawmakers at a closed-door seminar in Shenzhen on Sunday that any members of the opposition camp who insist on confronting the central government could not become chief executive. He said: "If a person who confronts the central government becomes the chief executive, it can be expected that the tension between the two governments will be heightened, the close connection between Hong Kong and the mainland will be damaged, and that Hong Kong society will be torn apart." In the wake of growing pressure from the pan-democratic camp to guarantee "genuine universal suffrage" for the chief-executive race in 2017 and the "Occupy Central" plan gaining momentum, Beijing felt it had little choice but to take the initiative in setting the parameters for the debate on universal suffrage. Those familiar with the history of the Communist Party know that the last thing it wants is to be forced into passivity. A lawmaker who attended the seminar on universal suffrage for Hong Kong said Qiao indicated that the central government had been "forced" to weigh in to the political-reform debate at such an early stage, citing four recent developments in Hong Kong. First were the questions raised by pan-democrats about the government delaying the consultation process after Chief Executive Leung Chun-ying's policy address in January. This was followed by University of Hong Kong law professor Benny Tai Yiu-ting planning for the Occupy Central movement to rally at least 10,000 people to block roads in Central on July 1, to put pressure on Beijing to keep its promise of allowing genuine universal suffrage in 2017. The third development came on March 6, when Yu Zhengsheng, a member of the Politburo Standing Committee, said it "would not be good for Hong Kong or the country if opposition forces ruled Hong Kong", sparking controversy about a possible screening mechanism. The fourth factor prompting Beijing to enter the debate was pan-democrat lawmakers forming the Alliance for True Democracy last week. "Qiao said the Basic Law and the decision made by the NPC Standing Committee were very clear on universal suffrage, but that recent developments had complicated the issue," the lawmaker said. "That is the reason he wants to set the tone for the debate early on." According to a decision by the Standing Committee in 2007, universal suffrage will be allowed for the election of the chief executive in 2017, and for the Legislative Council thereafter. And Article 45 of the Basic Law calls for a "broadly representative" nominating committee to forward chief-executive candidates for a popular vote in accordance with "democratic procedures". During the seminar, Qiao also said candidates for the chief-executive election in 2017 had to be nominated by a newly formed committee "as a whole", instead of by individual committee members, as in previous chief-executive polls. The nominating committee would follow "majority rule" in deciding who to put forward for "one man, one vote". Pan-democrats fear their candidates could be filtered out through this procedure. Qiao, the mainland's top authority on Hong Kong's mini-constitution, said the nominating committee might be formed with reference to the methods used to nominate previous chief executives. In last year's chief-executive race, the city's leader was chosen by the 1,200-member Election Committee, made up mainly of Beijing-loyalist businesspeople and professionals. A total of 249,499 voters were entitled to cast ballots in the subsector elections of the committee. While Qiao appeared to have ruled out the possibility of entering the chief-executive race for many pan-democrats, there was also a suggestion there could be some flexibility in the entry requirements. "Qiao said people can criticise the central government and the Hong Kong government. But that must not reach the point of life or death," said one pro-establishment lawmaker who had been at the Shenzhen meeting. ^ top ^



Exchanges to improve ties with Taiwan (China Daily)
The mainland's top official in charge of Taiwan affairs vowed on Friday to further improve cross-Straits ties through boosting non-governmental exchanges. Zhang Zhijun, the newly appointed minister of the Taiwan Affairs Office of the State Council, said mainland authorities will put forward more policies to make it convenient for Taiwan people to travel, work and start businesses on the mainland. " […] Zhang, former executive vice-minister of foreign affairs, called on Taiwan authorities to maintain positive communication with the mainland. […] Zhang said that the newly elected central government will continue to promote the peaceful development of cross-Straits relations, and policies toward Taiwan will continue to improve. The mainland's new leaders expressed their policies of peaceful development toward Taiwan during the 18th National Congress of the Communist Party of China and the National People's Congress, he said. Mainland authorities will continue to enhance cross-Straits cooperation in the education, tourism, finance, securities and insurance sectors, Zhang added. Zhang spoke highly of the progress in cross-Straits ties over the past few years, saying that mutual political trust has continued to be established. Cross-Straits trade reached a historic high of $168.96 billion last year. The mainland's investment in Taiwan increased 10-fold last year compared with the previous year, according to the Taiwan Affairs Office of the State Council. The number of mainland tourists going to Taiwan reached nearly 69,000 during the Spring Festival holiday early last month, about 30 percent more than last year, China News Service reported. Zhang told reporters after his speech that he expected to fulfill his dream, and that of his predecessor who expressed his pity at not having visited Taiwan. Zhang admitted that existing political factors have made cross-Straits ties more complex and difficult to resolve, and both parties should think about how to address the problems. Yang Kai-huang, a professor from the Department of Public Affairs of Taiwan-based Ming Chuan University, said that cross-Straits relations are influenced by many factors, including Taiwan's politics, the policy of the United States and Taiwan's participation in international events. Yan Anlin, a researcher from the Shanghai Institutes for International Studies, said that political dialogue has become the most urgent need in cross-Straits relations. "Compared with the rapidly growing economic and cultural exchange, political dialogue has gravely lagged behind," he said. Lien Chan, honorary chairman of Kuomintang, said during his visit to the mainland last month that think tanks could take the first steps to promote cross-Straits political dialogue. Zhang also encouraged academic circles from both sides to search for possible means of political dialogue and reach a deeper consensus. "Just as Premier Li Keqiang said on Sunday, there is no knot that cannot be undone between us, because we are fellow compatriots," he said. ^ top ^



Zhang Gaoli vows to continue economic reforms (SCMP)
New executive vice-premier Zhang Gaoli yesterday vowed to continue economic reforms, while reassuring foreign companies that they are welcome, as he warned that China's economy still faces many hurdles. Zhang said at a business forum organised by a State Council think tank, the Development Research Centre, in Beijing yesterday that China faced many uphill tasks in its economic reform efforts, but that authorities would "liberalise their thinking" to ensure that reforms do not grind to a halt. "Where control is required, the government must exert control, and control it straight and well. Where control is not needed, then the government should not control and intervene," Zhang said. "This is a very important job for us," Zhang said in his first public speech since being appointed executive vice-premier, adding that areas in need of change include government institutions, the household-registration system and environmental-protection standards. If such areas are not addressed, he said, "even if our absolute economic size gets bigger, our economy, our growth standards, will still be at the mid- to low-end". The division of responsibilities between the State Council's four vice-premiers and five state councillors, appointed last week, has yet to be made public, but Zhang is widely expected to take over the portfolio of his predecessor, Li Keqiang, to oversee the National Development and Reform Commission (NDRC), the super-ministry in charge of overall economic operations and environmental protection, as well as areas of land and housing. Zhang, formerly the party boss of Tianjin, visited the NDRC, Ministry of Finance, ministries of housing, environmental protection and lands, as well as the tax bureau, on Friday. Zhang also pledged yesterday that China would promote its open-door policy on a larger scale and at a deeper level, striking a balance between increasing its investments overseas and attracting foreign investors. "Some of our friends from abroad are very concerned about China's investment environment," he said. "I can tell you that fair competition is our common goal." However, Zhang warned that China's economy faces more headwind as it struggles with surplus production capacity and risks to the financial system. "There are increasing downward economic pressures, and the problem of excess capacity is worsening," Zhang said. "Objectively speaking, there are potential risks in the financial area." China's economy fought its worst slowdown in 13 years last year when weak exports and interest-rate hikes from the year before dragged annual growth to 7.8 per cent - impressive by global standards but the worst for China since 1999. ^ top ^

Suntech's fall rings alarm bell for China's solar industry (Xinhua)
The bankruptcy of Chinese leading solar panel maker Wuxi Suntech stunned the domestic photovoltaic (PV) industry last week, raising wide speculations on the future of the company and the whole sector. On Wednesday, the Wuxi City Intermediate People's Court approved the company's bankruptcy and ruled that it was undergoing "bankruptcy reorganization." The announcement came two days after Suntech said it had defaulted on a 541 million U.S. dollars bond payment. "The key reason lies in global overcapacity," noted a member of the bankruptcy liquidation team, adding that the company was defeated in the fierce price war. As a major subsidiary of the Nasdaq-listed Suntech Power, Wuxi Suntech was once one of China's four largest solar module makers. The company has been hard hit by shrinking global market for solar cells and panels as well as by punitive tariffs with the United States and Europe over alleging that Chinese dumping and government subsidies to producers. According to a senior company manager, the company's credit balance for the local and foreign currencies of the creditor banks totaled 7.1 billion yuan (1.14 billion U.S. dollars) by the end of February. The banks expected the company to seek a third party for strategic reorganization in order to revive the company, the manager added. Besides, sources revealed that the Suntech founder Shi Zhengrong, who was ousted from the position of chairman of board earlier this month, had the support of the Wuxi government and could return to the company as part of the reorganization, according to the 21st Century Business Herald. Some experts thought that was a wise move for the bankruptcy of Suntech. "It's a reasonable option for all the parties involved, including Suntech, the local government and its creditors," said an industry insider. "People don't know how much more money would have to be injected into the company to keep it afloat." "The local government might play the savior role, but it will definitely raise public doubts whether it's worthwhile to do so," said Ren Dongming, director of the Center for Renewable Energy Development of the National Development and Reform Commission's Energy Research Institute. "However, neither the local government nor any person can save the company if there's no market for its products," Ren added. As the bellwether of China's solar industry, Suntech is not the only enterprise which struggled for survive in the global recession. And its fall indeed rang the alarm bell for the whole sector. […] Now the PV companies in China all face similar problems of haphazard investments and excessive production capacity. The high reliability on overseas market is counted as a major reason that dragged China's solar industry into danger. The country's major solar panel producers, including Yingli Green Energy Holding Co,Trina Solar Ltd and LDK Solar Co, decided to expand their production capacities to increase their market shares in the past years. Suntech's production capacity increased from 400 mW in 2007 to 1,800 mW in 2010, and the figure soared to 2,400 mW last year. In wake of the global economic crisis, world's major solar markets, including Europe and the U.S., have shrunk dramatically, while anti-dumping and anti-subsidy moves targeting solar energy products have fatal impacts on the worsening solar companies in China. Orders for Chinese PV equipment dropped 80 percent year-on-year in 2012, the China PV Industry Alliance (CPIA) said in its latest report. It said up to 90 percent of Chinese poly-silicon makers had halted production, and 80 percent of solar panel producers had shut down or sharply reduced output. […] "Downsizing production capacity is painful, but I believe more competitive companies will arise in the coming years, thanks to booming domestic demand," said the CPIA secretary-general Wang Bohua. China has been devoting to encourage renewable energy development to provide power for its rapid economic growth while attempting to control the growing environmental pollution. In its 12th Five-Year Plan (2011-2015), the government attaches great importance to new energy industries, including solar energy, wind power, hydropower, nuclear power and biomass energy. To help companies stay afloat, the government carried out a package of measures last year to bolster the domestic solar power market. The newly-installed capacity of energy generated by solar panels in China last year surged to 4.5 GW from 0.45 GW in 2010, and it is expected to exceed 6 GW this year. "The government's target to create a 10-gigawatt domestic market this year will help the industry to some extent," said Gao Hongling, the CPIA deputy secretary-general. ^ top ^

Sinopec 2012 net profit falls 14.8% (Xinhua)
China Petroleum and Chemical Corporation, or Sinopec, the country's largest oil refiner, said on Sunday its net profits in 2012 dropped 14.8 percent year-on-year to 66.8 billion yuan ($10.65 billion). Business revenues amounted to 2.73 trillion yuan last year, an increase of 11 percent year-on-year as calculated according to the international financial reporting standards, the company said in a statement filing to the Shanghai Stock Exchange. By the Chinese reporting standards, Sinopec's net profit fell 11.4 percent to 63.5 billion yuan last year, mainly driven by the prospecting and extracting operations. The refinery sector saw losses of 11.95 billion yuan during the period, narrowing from the 37.61 billion yuan in 2011, according to the report. In 2012, Sinopec produced 328.28 million barrels of crude oil, among which 306 million are from explorations in China. The company forecast it will produce 46.43 million tonnes of crude oil and 18.1 billion cubic meters of natural gas this year. ^ top ^

Yuan strengthens to highest level against US dollar in 19 years (SCMP)
The yuan strengthened beyond 6.21 per US dollar for the first time in 19 years yesterday after the People's Bank of China raised the currency's reference rate and as investors reassured by a bailout deal for Cyprus returned to emerging-market assets. The central bank's fixing of the yuan at 6.2692 was its strongest level against the US dollar since January 15. "A stronger exchange rate could help China tame inflationary pressures and boost domestic consumption by lowering prices of imports," said Daniel Chan, Hong Kong-based executive vice-president of Glory Sky Global Markets. "The yuan is also hailed as a stable currency and hence has attracted some fund flows in times of uncertainty." The yuan strengthened 0.02 per cent to close at 6.2107 per US dollar in Shanghai. The Chinese currency traded at a 0.95 per cent premium to the reference rate, near the 1 per cent limit allowed by the PBOC. Meanwhile, the mainland swap market is signalling interest rate increases for the first time since 2011 after inflation accelerated to a 10-month high and the housing market defied government cooling efforts. Two-year contracts that exchange the central bank's 3 per cent savings benchmark rate for a fixed payment rose eight basis points this month to 3.03 per cent. This means investors in these swaps expect the interest rate to rise. The swap had been lower than the one-year PBOC deposit rate for 16 months. Of 27 economists surveyed this month, 13 predicted higher rates this year, with Credit Agricole, Daiwa Capital Markets and Nomura forecasting two increases. PBOC governor Zhou Xiaochuan said on March 13 that the government should be on "high alert" after consumer prices jumped a more-than-forecast 3.2 per cent in February. Data last week showed new home prices last month posted the broadest advance since December 2011. China's 10-year bond yield is 0.38 of a percentage point higher than inflation, compared with a similar US real yield of minus 0.08 of a percentage point. "The rising inflation trend and upward pressure on home prices will continue, forcing the central bank to tighten," said Dariusz Kowalczyk, senior economist and strategist with Credit Agricole in Hong Kong. "Main lending rates will be hiked to reduce inflation expectations." Inflation will probably quicken to 4 per cent in the second half of the year, a level that will "really concern" the PBOC, said Kowalczyk, who accurately predicted the February consumer-price gain. He forecasts two deposit rate increases after June to 3.5 per cent, to protect returns on savings. The central bank lowered its benchmark savings rate twice by a quarter of a percentage point last year. ^ top ^

China urges prudent EU solar ruling (China Daily)
China called on the European Union to prudently handle the ongoing trade dispute over the nation's exports of solar products, warning that an unfavorable ruling may incur countermeasures from China, a senior commerce official said on Monday. "If the EU insists on imposing duty orders on Chinese exports and severely hurts the interests of Chinese manufacturers, the Chinese government will not stand by. We have no choice but take any measure to protect the lawful rights of Chinese businesses," said Chong Quan, deputy international trade representative with the Ministry of Commerce. […] China's exports of solar products dropped 35 percent year-on-year in 2012, with exports of solar panels and modules down by more than 40 percent. The China-EU solar trade dispute will affect more than 400,000 Chinese workers, and "an improper handling of the case will definitely impact China-EU trade ties severely", said Chong. Amid challenging trade investigations, Suntech Power Holdings Co, one of the world's leading solar panel manufacturers, was ordered by a court on Wednesday to undergo "bankruptcy reorganization", dimming the prospects for the nation's solar industry. The EU announced in November that it will investigate alleged government subsidies for Chinese solar panel manufacturers, in addition to an investigation started in September into China's alleged "dumping" of such products in European markets. A preliminary ruling is expected to be issued in early June. After launching a probe into Chinese exports of solar glass late last month, the latest move in a long-running trade dispute between the EU and China, the bloc ordered its member states on March 5 to register imports of Chinese solar panels and their main components, an administrative step underscoring punitive duties to be applied retroactively if fault is found in the investigations. The United States imposed anti-dumping tariffs of up to 249.96 percent and countervailing duties of up to 15.97 percent in a final ruling by the US International Trade Commission in November. Former commerce minister Chen Deming said this month that politicians and entrepreneurs in the EU should handle the solar panel dispute with China properly to avoid greater losses for both sides, and the two sides should boost industrial cooperation as well as seek third-party markets. A report from the German think-tank Prognos, commissioned by The Alliance for Affordable Solar Energy, a coalition of over 160 companies in the European PV industry, said output of solar products within the EU may increase but total demand would fall owing to the extra cost of solar products, which would hit the wider solar industry as a whole within Europe, as well as other export industries supplying China. It predicts the loss of between 170,000 and 240,000 jobs within the EU and a total economic loss of between $24 billion and $36 billion over three years. Germany is expected to suffer most, followed by Italy, Spain and the United Kingdom. Chen added that the current solar trade dispute between China and the EU stemmed from the debt crisis that cut government subsidies to solar energy use in Europe. Meanwhile, Chinese solar panel manufacturers are major importers of solar equipment from both the EU and the US, and the current trade friction also hurts European and US companies. More than 90 percent of Chinese solar products are exported, with 70 percent shipped to the EU and 10 percent to the US, according to the ministry. The EU remained China's largest trading partner last year despite a 3.7 percent decline in China-EU bilateral trade to $546.04 billion, followed by China-US trade volume of $484.68 billion, according to the General Administration of Customs. To promote the industry, the State Council announced a series of measures in December to boost the solar industry in China. ^ top ^


DPRK and South Korea

North Korea to hold high-level meeting of top leaders (SCMP)
North Korea's top leaders are to meet in the coming days to decide on an unspecified “important” issue, official media said on Wednesday, as tensions simmer on the Korean peninsula. The Political Bureau of the Communist Party's Central Committee will convene its plenary meeting before the end of March to “discuss and decide an important issue for victoriously advancing the Korean revolution”, the Korean Central News Agency said. KCNA did not specify the date for the meeting, which will also reportedly make a “drastic turn” in accomplishing the North's Juche (self-reliance) revolutionary cause. Analysts in Seoul said decisions on issues concerning security, international relations and reshuffle of personnel were likely to be made at the meeting and approved by the North's rubber-stamp parliament, meeting on April 1. “They will discuss how to handle the nuclear issue, inter-Korean relations and North Korea's long-standing demand for a peace treaty with the United States,” Professor Yang Moo-Jin of the University of North Korean Studies in Seoul said Yang said Jang Song-Thaek, uncle of North Korea's leader Kim Jong-Un, could be appointed as prime minister with the task of resuscitating the country's struggling socialist economy. There could also be changes in the make-up of the powerful Presidium of the Political Bureau. Vice Marshall Hyon Yong-Chol, the chairman of the Joint Chiefs of Staff, could join the body, which would further strengthen the military's say over key state affairs, said Yang. Angered by UN sanctions imposed after its nuclear test in February, Pyongyang has issued a wave of threats over the past month – ranging from a surgical military strike to nuclear war. North Korea's military put its “strategic” rocket units on a war footing on Tuesday, with a fresh threat to strike targets on the US mainland, Hawaii and Guam, as well as South Korea. The move came as South Korea marked the third anniversary of the sinking of its naval vessel “Cheonan” by what Seoul insists was a North Korean submarine. In the latest sign of tensions, a South Korean soldier standing on guard at the inter-Korean border threw a grenade towards a moving object in the dark early on Wednesday, sparking a short-lived alarm, the defence ministry said. At daylight, a patrol searched the area but there was no trace of any infiltration from North Korea, a ministry spokesman said. A precautionary alert, which had been issued for South Korean units in the northeastern county of Hwacheon, was consequently lifted. ^ top ^

US says North Korea cutting of military hotline 'provocative' (SCMP)
US Defence Secretary Chuck Hagel promised “unwavering” support from the United States to its ally South Korea on Wednesday after North Korea severed a military hotline with Seoul. During a call with his South Korean counterpart Kim Kwan-Jin, Hagel “reaffirmed the strength of the alliance, which has been, and continues to be, instrumental in maintaining stability on the Korean peninsula,” Pentagon spokesman George Little said in a statement. He also discussed “the unwavering United States commitment to our alliance with the Republic of Korea, especially during this time of heightened tension on the Korean Peninsula.” The two allies signed a new military pact last week to boost a joint response to any aggression from the North. About 28,500 US military forces are stationed in South Korea to counter the threat from the belligerent North. Earlier, Little criticized the North's decision to cut the hotline as a “provocative and unconstructive step.” “It's very important for the regime to focus on what we think is the right course of action, and that is peace and stability on the Korean peninsula, and their provocations and bellicose rhetoric aren't helpful in the situation,” he added. The decision to sever the last direct communication link with the South coincided with an announcement that the North's top leadership would meet in the next few days to discuss an “important issue” and make a “drastic turn.” The hotline move was relayed by a senior North Korean military official to his South Korean counterpart just before the link was severed. “Under the situation where a war may break out any moment, there is no need to keep up North-South military communications,” the official was quoted as saying by the official Korean Central News Agency. Cutting the hotline was the latest in a series of threats and actions that have raised tensions on the Korean peninsula since the North's long-range rocket launch in December and its nuclear test last month. Both events triggered UN sanctions that infuriated Pyongyang, which has spent the past month issuing increasingly bellicose statements about unleashing an “all-out war.” State Department acting deputy spokesman Patrick Ventrell said Washington remained in close contact with its allies in the region as the situation unfolds. A communications channel, which allows contact between North Korea and the United States even though they have no diplomatic ties, also remained open, he said. “We remain prepared to engage constructively with North Korea, but North Korea must live up to its commitments, adhere to its international obligations, deal peacefully with its neighbours and refrain from this provocative action,” Ventrell told journalists. ^ top ^



Mongolia mine closure plunges SouthGobi into the red (SCMP)
Mongolia-focused coal miner SouthGobi Resources posted a hefty loss for last year as Ulan Bator forced it to suspend its only producing mine in response to a takeover bid from China's state-owned Chalco. But SouthGobi, which is now controlled by Rio Tinto, has resumed operation and aims to produce 3.2 million tonnes of semi-soft coking coal this year, its president and chief executive, Ross Tromans, told Reuters. “We have looked at our mine, our cost structure, and our market, we believe it makes sense to come back,” said Tromans, appointed in September to run the company after aluminium giant Chalco's failed bid for control of SouthGobi. Chalco, which sought to diversify into coal, iron ore and electricity, dropped its US$926 million (HK$7.2 billion) bid in September, faced with stiff political opposition from Mongolia. Tromans shrugged off the persisting weakness in the Chinese steel market to which the company supplies all its coking coal, whose prices have plunged in the past 12 months. “Yes, prices have plunged, but from a very high level,” he said. “You need to be a producer, to be back in there when the demand picks up. We can't wait to let it happen.” The company posted a net loss of US$103 million (HK$799.5 million) last year, versus net profit of US$58 million in 2011 as revenue dived to US$53 million from $179 million. Shares of SouthGobi in Hong Kong fell 3.3 per cent on Tuesday. The stock has lost 67 per cent in the past 12 months. SouthGobi said last Thursday it had resumed operations at its flagship Ovoot Tolgoi mine in Mongolia after about nine months. ^ top ^


Andrin Eichin
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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