Foreign Policy

• China-Turkmenistan ties becoming strategic (China Daily)
• China ready to build on Philippine shoal, says Philippine defence secretary (SCMP)
• Li Keqiang offers Asean cautious backing for South China Sea accord (SCMP)
• Xinhua Insight: Li Keqiang vows China-ASEAN "diamond decade" (Xinhua)
• Xi Jinping secures greater security and energy ties with Turkmenistan (SCMP)
• China, ASEAN discuss industrial cooperation plan (Xinhua)
• Xinhua Insight: ASEAN-China Expo rekindles hopes for hydropower project (Xinhua)
• Xi, Putin meeting to focus on 'mega projects' (China Daily)
• Gas deal to double Turkmen imports to China (Global Times)
• Beijing rejects Manila claims over Huangyan (Global Times)
• Obama to lobby Xi Jinping for support on military intervention in Syria (SCMP)
• War can't solve Syria problem, warns China at G20 meeting (SCMP)
• China hails Austria's stance of not supporting Tibet independence (Global Times)

Domestic Policy

• Zhou Yongkang's rise to power fuelled by oil (SCMP)
• Police seize thousands in crackdown on online crimes (Xinhua)
• Former oil company chief and protégé of ex-security tsar Zhou Yongkang is latest graft probe target (SCMP)
• Discipline bodies launch website (Global Times)
• Xi Jinping rallies party for propaganda war on internet (SCMP)
• Trial for six graft-busters who 'tortured official with ice-water' before he died (SCMP)
• China aiming to tame weather (China Daily)
• 'Catastrophe' as 114 million Chinese suffer diabetes thanks to economic boom (SCMP)
• Former Shaanxi official Yang Dacai is jailed for 14 years (SCMP)

Beijing

• Chinese capital urged to take lead in air pollution treatment (Xinhua)

Shanghai

• Shanghai vice mayor Ai Baojun to head up free-trade zone later this month (SCMP)
• Shanghai free-trade zone may be extended to cover all of Pudong (SCMP)
• Inland region 'key' to growth (China Daily)

Hongkong

• Universal suffrage is HK goal: top legislator (Xinhua)

Economy

• China-ASEAN cooperation drives investment westward (China Daily)
• Reforms urged for pharma industry (China Daily)
• Russia's Gazprom and CNPC agree terms on massive gas deal (SCMP)

DPRK and South Korea

• Satellite spots construction at North Korean rocket launch site (SCMP)
• North Korea cancels US envoy's visit for talks over detainee Kenneth Bae (SCMP)

Mongolia

• Domog Folk Band wins Grand Prix in World Championship of Folklore (UB Post)
• West Tsankhi site will start to export coal soon (Montsame)
• Mongolia-Russia's Altanbulag-Kyakhta border crossing to be operational 24 hours a day (Info Mongolia)
• Discover Mongolia-2013 begins (news.mn)

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China-Turkmenistan ties becoming strategic (China Daily)
2013-09-02
Relations between China and Turkmenistan are becoming strategic with more benefits from ever expanding pragmatic bilateral cooperation, said Chinese Ambassador to Turkmenistan Xiao Qinghua. China-Turkmenistan relations have made strides since the two countries established diplomatic on January 6, 1992 and they are at their best now thanks to efforts of leaders of both countries, Xiao told Chinese reporters ahead of President Xi Jinping's visit to the Central Asian nation. The two sides have continuously deepened political mutual trust, consolidated pragmatic cooperation, and actively conducted humanistic exchanges, Xiao said, adding that both countries have felt the tangible benefits for economic development and people's livelihood. China and Turkmenistan regard each other as sincere friends and important partners of cooperation, support each other's choice of development path in line with national conditions, and respect and treat each other as equals, said the ambassador. Exchanges and cooperation between the two countries enjoy a good momentum as manifested by frequent exchange of visits at various levels every year, said the ambassador. On economic and trade cooperation, Xiao said two-way trade exceeded 10 billion U.S. dollars last year, compared to only 4.5 million dollars in 1992 when the two countries forged formal relations. China has become the largest trade partner of Turkmenistan, while Turkmenistan has become the third largest trade partner of China in the Commonwealth of Independent States, he said. The two countries are each other's largest cooperative partner in natural gas, Xiao said. He noted that China and Turkmenistan put into operation the world's largest natural gas pipeline in December 2009, which benefited millions of Chinese people. China and Turkmenistan also maintain close coordination and cooperation in international and regional affairs, Xiao said. Both countries attach great importance to the vital role of the United Nations and regard the world body as an important platform for regional and international cooperation, he said. The ambassador said China regards Turkmenistan as a reliable partner and close friend. The two countries have broad prospects of cooperation in various fields in the future, he added. Friendly relations between China and Turkmenistan are not only in the fundamental interests of the two peoples, but also conducive to peace, stability and development in the region and the world at large, he said. Xiao said the two countries' relations have yielded fruitful results thanks to high-level exchanges, which have provided a solid political foundation for the smooth and healthy development of bilateral ties. The development of China-Turkmenistan relations have also benefited from the principles of mutual respect, mutual understanding and mutual trust, as well as complementary advantages and mutually-beneficial and win-win cooperation. On President Xi's upcoming visit, Xiao said it is of historic significance for strategic cooperation between China and Turkmenistan. During the visit, Xi is expected to hold in-depth exchange of views with his Turkmen counterpart, Gurbanguly Berdymukhamedov, on bilateral ties and issues of common concern and make a series of important decisions on the future development of the two countries' relations, he said. The ambassador expressed the belief that Xi's visit will push forward China-Turkmenistan ties into a new period of development. With the care of the two countries' leaders and through the two sides' unremitting efforts, China-Turkmenistan relations will definitely have a better future, Xiao said. ^ top ^

China ready to build on Philippine shoal, says Philippine defence secretary (SCMP)
2013-09-04
Philippine Defence Secretary Voltaire Gazmin has accused China of preparing to build a structure on an uninhabited group of reefs within its territory. The Philippine armed forces took aerial photographs of three Chinese coastguard ships and about 30 concrete blocks on the Scarborough Shoal, which China calls Huangyan Island, on August 31, Defence department spokesman Peter Galvez said. Briefing parliament about the incident, Gazmin said the blocks were a "prelude to construction" and added that the move contravenes a 2002 declaration between China and the Association of Southeast Asian Nations to refrain from occupying land in the South China Sea. "First rocks, then a piledriver, then a foundation," Gazmin said after his testimony. "When you get back again, if you don't survey, there will be a garrison." The accusation adds to tensions days after President Benigno Aquino rejected conditions China set for him to attend a trade fair. The Philippines, a US treaty ally, lacks the military force to deter China from controlling disputed waters that may contain oil and gas reserves. The Philippines asked the UN in January to rule on its maritime disputes with China, a move that leaders in Beijing oppose. "The important thing is we put men there, so this can be prevented," Gazmin said. "We don't have the capability to do that at the moment." Asked about Gazmin's remarks, China's Foreign Ministry spokesman Hong Lei said yesterday that he had no information about the matter China has accused the Philippines of illegally occupying Ayungin Shoal, where Philippine troops have been stationed since 1999. The Philippines and Vietnam reject China's map of the sea, first published in the 1940s, as a basis for joint exploration for oil and gas. In a blunt description of the situation, a senior judge in the Philippines said the country had lost Scarborough and would soon likely lose Ayungin, or Renai Shoal, as well. Supreme Court Associate Justice Antonio Carpio, in a speech to the Philippine bar association on August 29, said that bringing the dispute before the international tribunal was Manila's "only viable option". Carpio said China's claim over almost 90 per cent of the sea rested mainly on "historical rights" and its "nine-dash line". Chinese scholars were "divided" on how to assert the claim based on the nine-dash line, he said. "China's incumbent judge in the international tribunal, Zhiguo Gao, wrote in 1994 that the nine dashes merely identify the islands owned by China within the enclosed area and do not represent a claim to all the waters and resources within the enclosed area," he said. This line had also kept changing, Carpio said. "China's nine-dash line claim was originally represented by 11 dashes in the 1947 Chinese map, then reduced unilaterally in 1950 to nine dashes without explanation after the Communists ousted the Kuomintang from the mainland. In January this year, China released a new official map adding a 10th dash on the eastern side of Taiwan." He also said China contradicted these nine dashes when it issued in 1992 a law declaring a 12-nautical mile territorial sea from its baseline. He described Manila's arbitration move as "an acid test" for the United Nations Convention on the Law of the Sea. Upholding the nine-dash line means "killing UNCLOS", he said, because UNCLOS would no longer operate in the South China Sea since China will appropriate everything there, including what the entire world recognises as "the high seas". At the China-Asean trade fair in Nanning, Ponciano Manalo, an undersecretary of the Philippine board of investments, said territorial disputes could affect trade ties. "I think territorial issues should be left to the governments and departments that are [responsible]," he said. ^ top ^

Li Keqiang offers Asean cautious backing for South China Sea accord (SCMP)
2013-09-04
Premier Li Keqiang told Asean leaders yesterday China was serious about wanting a peaceful resolution to disputes over the South China Sea, though he signalled Beijing was in no rush to sign a long-mooted accord on maritime conduct. "South China Sea disputes should not, and will not, affect the overall China-Asean co-operation," Li said at the opening of China-Asean Expo in Nanning in Guangxi. Friction over the South China Sea has intensified as China uses its growing naval might to assert its claim to most of its area, believed to be rich in oil and gas, raising fears of a military clash. Four of Asean's 10 members, including Vietnam and the Philippines, have overlapping claims with China. The four-day business and investment fair was attended by Vietnamese Prime Minister Nguyen Tan Dung and Thai Prime Minister Yingluck Shinawatra, among other regional leaders. Philippine President Benigno Aquino, however, did not attend after Manila alleged Beijing had set conditions for his trip, while China denied having invited him. After years of resisting efforts by Asean to start talks on an agreement on maritime rules governing behaviour in the region, the so-called code of Conduct, China has said it will host talks between senior officials this month. Li said China had always advocated talks on the South China Sea on the basis of "respecting historical reality and international law". "The Chinese government is willing and ready to assume a policy of seeking an appropriate resolution through friendly consultations," Li told the audience. China would "proceed systematically and soundly push forward talks on the Code of Conduct for the South China Sea", he said without elaborating in comments aired live on state TV. He repeated that talks on the dispute should only be carried out between the parties directly concerned - Beijing's standard line, which rejects the involvement of outside parties such as the United States or multilateral forums. Li stressed it was Beijing's long-term policy to maintain friendly relations with its Asean neighbours. Among a host of initiatives to foster China's co-operation with the regional grouping, Li called for further trade liberalisation to build on the existing bilateral free -trade agreement; speeding up transnational infrastructure including transport, telecommunication and energy links; strengthening co-operation on regional financial stability; and establishing a China-Asean maritime partnership. His call was echoed by Thailand's Yingluck, who also urged "Asean leaders to meet as soon as possible to discuss high-speed-railway construction". ^ top ^

Xinhua Insight: Li Keqiang vows China-ASEAN "diamond decade" (Xinhua)
2013-09-04
Chinese Premier Li Keqiang said on Tuesday China will work Association of Southeast Asian Nations (ASEAN) countries to build a community of "common destiny" to share peace and prosperity, Li made the remarks at the opening ceremony of the 10th China-ASEAN Expo and the China-ASEAN Business and Investment Summit in Nanning, capital of south China's Guangxi Zhuang Autonomous Region. "We had the capabilities to create a "golden decade" in the past, we also have the power to create a "diamond decade" in the future," said the premier. China and the ASEAN should work together to cope with risks and challenges and strive to maintain stable economic operation and healthy development, which are the common interests of all parties, said Li. "China's good-neighborly policy toward the ASEAN is absolutely not a matter of expediency, but a long-term strategic option of China," said Li. China is the largest trading partner of the ASEAN, while the ASEAN ranks as China's third-largest trading partner. This year's expo attracted more than 2,300 companies from China and the ASEAN, consolidating its place as an important platform to promote bilateral trade and relationships between China and the ASEAN. To deepen pragmatic economic cooperation, Li proposed "an upgraded version" of the China-ASEAN Free Trade Area (CAFTA), adding that the Chinese side will strive to expand bilateral trade to 1 trillion U.S. dollars by 2020 and increase bilateral investment by 150 billion dollars during the next eight years. Launched in 2010, the CAFTA has become the world's largest free trade area among developing countries, covering a total population of 1.9 billion. Cambodian Prime Minister Hun Sen said the China-ASEAN expo has become a solid and successful platform for economic and trade exchanges. The expo has successfully facilitated the construction of the CAFTA under the framework of strategic partnership, and created various bilateral trade and economic opportunities, added ASEAN Secretary-General Le Luong Minh. Bilateral trade between China and the ASEAN amounted to 400.1 billion U.S. dollars last year, nearly six times that of 10 years ago. In the first half of 2013, the bilateral trade surged to 210.56 billion U.S. dollars, representing a 12.2-percent increase year on year. On Tuesday, Li said that China and the ASEAN could consider holding discussions on further lowering tariffs, and the Chinese side is willing to expand imports from the ASEAN and boost free trade and investment. China is willing to join hands with the ASEAN to advance talks of Regional Comprehensive Economic Partnership (RCEP), and discuss exchanges and interactions with frameworks such as Trans-Pacific Partnership (TPP) Agreement, so as to create an open, inclusive and mutually beneficial climate to "make the two wheels of regional and global trade roll together," according to the premier. [...]. ^ top ^

Xi Jinping secures greater security and energy ties with Turkmenistan (SCMP)
2013-09-04
President Xi Jinping and his Turkmen counterpart Gurbanguly Berdimuhamedov agreed yesterday to upgrade the status of their diplomatic ties to a strategic partnership. Turkmenistan would boost its natural gas shipments to China by an additional 25 billion cubic metres (bcm) annually to up to 65 bcm a year by 2020, senior Turkmen officials said. Xi arrived in Turkmenistan's capital, Ashgabat, on his way to the G20 summit in St Petersburg, Russia. He will visit neighbouring Kazakhstan, Uzbekistan and Kyrgyzstan on the way back. In a written statement delivered upon his arrival, Xi said China and Turkmenistan were important neighbours with a strategic energy relationship. "The Sino-Turkmen relationship has a solid foundation and rich content," Xi said. "The co-operation between our two nations has been continuously improving. It is time for our two nations to upgrade our strategic partnership." Xi and Berdimuhamedov signed a joint declaration raising each other's diplomatic status, Xinhua reported. They also oversaw the signing of a purchase-and-sale agreement for 25 bcm of Turkmen gas a year between China National Petroleum Corporation and TurkmenGas. China has imported 60 bcm of natural gas from Central Asia since 2009, Deputy Foreign Minister Cheng Guoping said ahead of Xi's trip. China has become the largest trade partner of Turkmenistan, with bilateral trade reaching US$10.3 billion last year, up from US$4.5 million in 1992. The two nations opened the world's longest natural gas pipeline in 2009, which extends more than 8,000 kilometres and serves Hong Kong. By June, Turkmenistan had attracted US$3.3 billion in Chinese investments. In an interview with Central Asian and Russian media, Xi said energy co-operation between China and Turkmenistan serves as a role model for global energy co-operation. China is ready to expand the pipeline construction and natural gas trade with Turkmenistan. China would continue to develop an equal and mutually beneficial partnership with Turkmenistan, CCTV reported. On Thursday, Xi will travel to St Petersburg for the summit of the Group of 20 developed and major developing nations, where a major topic of discussion is expected to be the slowing economic growth in China and other major emerging economies such as Brazil, Russia, India and South Africa. Emerging-market economies have issued a raft of gloomy data, leading to concerns that their boom days are over. After the summit, Xi will visit three other Central Asian countries. In Kyrgyzstan, he will attend a meeting of regional security body the Shanghai Co-operation Organisation. ^ top ^

China, ASEAN discuss industrial cooperation plan (Xinhua)
2013-09-04
China and the Association of Southeast Asian Nations (ASEAN) discussed the making of a road map for industrial cooperation at an ongoing expo in south China's Guangxi Zhuang Autonomous Region on Wednesday. At the China-ASEAN Expo's Roundtable Meeting on Investment Cooperation in Nanning, capital of Guangxi, Chinese and ASEAN officials working in investment exchanged ideas on deepening cooperation in various fields. The meeting has reached agreement on priority areas of industrial cooperation for next year. Corazon H. Dichosa, an officer of the Board of Investments of the Philippines, said at the meeting that China and ASEAN member nations complement each other in many industrial areas, and that both sides should help each other "like brothers." Gao Ge, professor with the Institute of China-ASEAN Research of Guangxi University, said that the road map will greatly boost mutual investments, and that it will bring more benefits for both sides. The roundtable meeting was part of the 10th China-ASEAN Expo, which opened in Guangxi on Tuesday. ^ top ^

Xinhua Insight: ASEAN-China Expo rekindles hopes for hydropower project (Xinhua)
2013-09-04
Talks of resuming the Myitsone hydropower project have grown louder as leaders of China and Myanmar have urged greater cooperation on the sidelines of the 10th ASEAN-China Expo. Utun Naing Aung, chairman of the Energy and Environmental Group of the Myanmar Industries Association, said that if the joint venture project were put off until 2015, the development of Myanmar's power industry would be delayed for five years. "To achieve the target of tripling Myanmar's gross domestic product (GDP) by 2030, boosting energy development is necessary," said Utun. Jin Honggen, an economic and commercial counselor at the Chinese Embassy in Myanmar, said that the Myitsone hydropower station is a win-win project for both sides. "China has been hoping to restart it," Jin said. While meeting Myanmar President U Thein Sein on Tuesday in Nanning, capital of south China's Guangxi Zhuang Autonomous Region, Chinese Premier Li Keqiang suggested that both countries should enhance political mutual trust, discuss new thoughts and paths to deepen cooperation and bring greater benefits to local people. U Thein Sein said that his country is willing to boost strategic communication and expand cooperation so as to promote development of bilateral ties and ASEAN-China relations. Advocates for early resumption of the Myitsone hydropower station said that the high-profile exchange has rekindled their hopes, calling on both sides to establish an inter-governmental mechanism to facilitate resumption of the project as early as possible. "Misunderstanding has led to the suspension," said Guo Gengliang, deputy general manager of the Upstream Ayeyawady Confluence Basin Hydropower Co. Ltd., a Sino-Myanmar joint venture to manage hydropower resource development in Myanmar. Work on the Myitsone hydropower station, the largest of seven hydropower stations to be built under the Sino-Myanmar Framework Agreement on Joint Development of Hydropower Resources in Myanmar signed in March 2003, was suspended abruptly on Sept. 30, 2011 by the Myanmar government under the excuse of public will. With an installed capacity of six million kilowatts, the project costs 3.6 billion U.S. dollars and is scheduled to begin generating electricity in 2017. [...] According to the agreement, about 60.7 percent of the return on investment will go to Myanmar, including free supply of 10 percent of electricity produced and 15 percent of the joint venture's free equities and tax revenue. The remaining 39.3 percent would belong to China, he explained. [...]. ^ top ^

Xi, Putin meeting to focus on 'mega projects' (China Daily)
2013-09-05
President Xi Jinping will meet his Russian counterpart Vladimir Putin for the second time in six months and the two are likely to discuss cooperation in large-scale projects, a senior Chinese diplomat said. "Xi is scheduled to meet with Russian President Vladimir Putin and their talks may focus on cooperating on ‘mega projects' between China and Russia and on further strategic coordination at international and regional levels," Chinese Ambassador to Russia Li Hui said in an interview before Xi's arrival in St. Petersburg on Wednesday for the G20 summit. The two are expected to exchange views on proposed US strikes on Syria, following Washington's claim that the Syrian government used chemical weapons on its own people. Putin has previously voiced opposition to the US stance and China has been urging the US to present evidence of chemical attacks. Li said Xi's meeting with Putin, the second in six months, strongly illustrates the strategic importance of the China-Russia relationship. "China and Russia recognize each other as their most important strategic partners, and they have their soundest relations in history so far," Li said. He said the two leaders will be determined to expand on their political partnership into new areas to achieve common development and prosperity. Li said he expected they would launch more big projects, but did not give details. [...] "The two have huge potential to tap into economic cooperation, built on their close political partnership, and China is willing to expand investment in Russia, especially in mega projects." Li said mega projects may help realize the goal of expanding bilateral trade volume to $100 billion in 2015 and $200 billion in 2020. China's investment in Russia in the first quarter of this year surged to $2.23 billion from $740 million in all of 2012, according to Russian statistics. ^ top ^

Gas deal to double Turkmen imports to China (Global Times)
2013-09-05
Chinese President Xi Jinping and his Turkmen counterpart Kurbanguly Berdymukhamedov Wednesday jointly announced the completion of the first phase of construction of the Galkynysh gas field in Turkmenistan after both sides signed an additional energy deal that will likely double imports of Turkmen natural gas to China in the coming years. "The project, testifying to the willingness of the Chinese and Turkmen peoples to boost development through cooperation, will inject fresh and strong impetus to energy cooperation between the two countries," said Xi, adding that the two countries have unleashed new opportunities for deepening energy cooperation. [...] The two countries had already signed 40 bcm of gas deals by 2009. Turkmenistan is expected to export 65 bcm of gas annually by 2020. According to data from China's Ministry of Commerce, China imported a total of 40.8 bcm of natural gas in 2012, a 29.9 percent growth from the previous year. Roughly half of the imports came from Turkmenistan. Energy experts believe the gas deals represent China's efforts to seek diversified sources of energy as energy demands surge with the booming economy. "China used to and still does depend heavily on oil from the Middle East, but as unrest grows in the area, it is important for China to seek other stable sources to eliminate the impact of Middle East turmoil on its economy," Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times. Lin's opinion was echoed by Wu Dahui, director of the Eurasian Strategic Research Center under Tsinghua University, who said that Turkmenistan is also seeking to diversify its natural gas customers. "A great proportion of Turkmenistan's natural gas exports go to Russia, which, to this day, still holds the best natural gas contract with the country," said Wu. "In today's world, energy holds a lot of sway in foreign relations. Turkmenistan, while seeking diversified customers, is looking to balance the influence." [...]. ^ top ^

Beijing rejects Manila claims over Huangyan (Global Times)
2013-09-05
Chinese foreign ministry spokesman Hong Lei Wednesday rejected Philippine allegations that China had laid concrete blocks on Huangyan Island, saying, "What the Philippine side said is not true." "Huangyan Island is China's inherent territory," Hong reiterated, adding that China's public service vessels have conducted routine patrols around the island so as to safeguard both sovereignty and order in the waters, which is China's right. This comes after Philippine defense spokesman Peter Galvez said the country had sighted at least 30 concrete blocks on the island's northern part and more allegedly installed by China in the waters. Galvez said any construction would violate the Declaration on the Conduct of Parties in the South China Sea, an agreement between China and its Southeast Asian neighbors to refrain from actions that could amplify or complicate the situation. Sun Xiaoying, a research fellow of Southeast Asian studies with the Guangxi Academy of Social Sciences, told the Global Times that the Philippines together with other countries along the sea first constructed facilities and moved residents onto some disputed islands in the waters, turning some of them into "construction sites.". ^ top ^

Obama to lobby Xi Jinping for support on military intervention in Syria (SCMP)
2013-09-05
President Barack Obama is expected to lobby his Chinese counterpart Xi Jinping to support military strikes against Syria during a bilateral meeting on the sidelines of a G20 summit. Observers said Beijing was likely to continue to side with Russia to oppose military intervention in response to allegations that Syrian president Bashar al-Assad used chemical weapons against his people. But they expected Xi to soften the rejection to avoid hurting recent personal ties with Obama, who he met in California in June at an informal summit. "Beijing may tell Washington that it may support a strike against Syria if the US got clear proof that chemical weapons have been used by the Syrian government," said Jia Qingguo, a professor at Peking University. The announcement of a Xi-Obama meeting, which was made by the White House yesterday, came as Obama won the backing of US House Speaker John Boehner, the top Republican in Congress, and House Democratic leader Nancy Pelosi for military intervention in Syria. Arriving in Stockholm for a two-day visit, Obama said the world had set "a red line" for Syria and the international community's credibility was at stake if it did not take action. "I didn't set a red line. The world set a red line," Obama said, referring to international rules banning the use of chemical weapons. The only other G20 leader Obama is scheduled to meet on the sidelines is French President Francois Hollande, who is seeking a coalition of European nations to back a military response. China, a veto-wielding member of the UN Security Council, has said it opposed the use of chemical weapons, but Foreign Minister Wang Yi said a political resolution was the only way out because outside military interference without UN approval would exacerbate turmoil. [...]. ^ top ^

War can't solve Syria problem, warns China at G20 meeting (SCMP)
2013-09-06
China pressed for a political solution to the crisis in Syria yesterday, and warned that expanding the conflict could hurt global economic growth. Chinese officials made the comments in St Petersburg, where President Xi Jinping was making his debut at the G20 summit. The summit of the world's largest economies was overshadowed by US President Barack Obama's effort to overcome Russian opposition to a military strike on Syria. Qin Gang, spokesman for the Beijing delegation, said that in a meeting between Xi and his Russian host, President Vladimir Putin, the two men did not discuss Syria "due to limited time", China National Radio and Russian media reported. Phoenix TV reported that the meeting lasted an hour. But Qin expressed caution about any US-led military response, urging "the concerned countries to be highly prudent". "War cannot solve the problem in Syria," Qin said. "A political solution is the only way to solve the issue." Beijing warned that any strike could hurt the global economy by increasing uncertainty and driving up oil prices.
"Military action would have a negative impact on the global economy, especially on the oil price," said Deputy Finance Minister Zhu Guangyao, who estimated that a US$10 increase in the price of crude oil could reduce global growth by 0.25 per cent. China and Russia vetoed a UN resolution condemning the Syrian government's crackdown on protests in February. The Chinese Foreign Ministry quoted Xi yesterday as saying that China was committed to enhancing its strategic partnership with Russia and protecting the interest of emerging markets. Xi and Putin witnessed the signing of documents boosting trade ties, including a long-awaited deal that will see Russia shipping up to 68 billion cubic metres of natural gas to China a year. Observers believe Beijing would like to play down the Syria crisis, since Xi will meet Obama on the sidelines. Even though China is expected to side with Russia over Syria, a high-profile stance by Xi could cause unease in Washington, they said. ^ top ^

China hails Austria's stance of not supporting Tibet independence (Global Times)
2013-09-06
China spoke highly of Austria's stance of giving no support to any separatist activities that seek Tibet independence and undermine China's territorial integrity, Foreign Ministry spokesman Hong Lei said Thursday. Hong made the comments in response to a recent meeting between Political Director of the Austrian Foreign Ministry Jan Kickert and Chinese Ambassador to Austria Zhao Bin in Vienna. According to Hong, Kickert said that it was regrettable that the Austrian chancellor and vice chancellor's meetings with the Dalai Lama in Vienna in May last year had a negative impact on Austria-China relations. Austria attaches great importance to developing friendly and cooperative ties with China, said Kickert, adding that the country adheres to the one-China policy and recognizes Tibet as part of China. Austria does not support any secessionist activities that seeks Tibet independence and undermines China's territorial integrity, he said. "China spoke positively of the above statements," said Hong in a statement, adding that the Chinese government places importance on its friendly and cooperative relations with Austria. China and Austria agree to further forge ahead bilateral ties on the basis of mutual respect, equality, mutual benefit and respect for each other's core interests and major concerns, said the spokesman. Both sides pledge to enhance communication and coordination so as to work for lasting, healthy and sustainable development of bilateral ties, Hong said. Austrian Chancellor Werner Faymann and Vice-Chancellor and Foreign Minister Michael Spindelegger met with the Dalai Lama respectively last year. China objected strongly to the meetings and lodged representations to the Austrian side. ^ top ^

Zhou Yongkang's rise to power fuelled by oil (SCMP)
2013-08-31
For much of his career, Zhou Yongkang glided among the most influential sectors of modern China - oil, land and eventually the national police apparatus.Much of his success can be traced to his membership of the so-called petroleum gang - top officials who began their professional lives in the industry as the nation pivoted from oil exporter to importer in the 1990s. The change benefited state-owned oil giants that have exclusive rights to import crude. A key member was Zeng Qinghong, the former vice-president. He mentored Zhou and referred him to former president Jiang Zemin. Zhou rose to the highest level of power - membership in the Standing Committee of the Politburo. But he exposed himself to attack by aligning himself with fallen princeling Bo Xilai - another champion of the truncheon school of policing. He was reportedly the sole member of the Standing Committee to disapprove of how the former Chongqing party chief was being handled before his sacking. Zhou was born in 1942 in Wuxi, Jiangsu province. He studied oil exploration at the Beijing Petroleum Institute, graduated in 1966, and joined a geology team scouting for wells in Heilongjiang' s Daqing Field, then just starting production. He remained in the industry, working in exploration and surveying, and in the 1980s became acquainted with Zeng Qinghong. Zeng was then working in the liaison office of the China National Offshore Oil Corporation and would later take up key party roles in Shanghai at a time when Jiang Zemin was serving as its mayor. In 1985, Zhou was named vice-minister of the Petroleum Industry and stayed there until it was disbanded by the central government, who renamed it the China National Petroleum Corporation (CNPC) in 1988. Over the next decade, he rose through the ranks of the corporation to become general manager, in addition to being the party's top man at the company, before he left in 1998. Zhou was then tapped to head the Ministry of Land Resources. The following year he was named party secretary of Sichuan province, a post he held until 2002. The resource-rich province would eventually become the power base for Zhou and his family. His son, Zhou Bin, owns an investment company and a hydraulic company there. His whereabouts are now unknown.Widely referred to as a Jiang protégé, Zhou was elected to the 25-member Politburo in 2002. He was also appointed to the powerful post of minister of public security. Zeng officially retired in 2008, and his ties to Zhou loosened, but the minister had consolidated his grip on power the year before by making a successful play for a coveted spot on the nine-member Politburo Standing Committee. He was also promoted to secretary of the Political and Legislative Affairs Commission of the party, which oversees internal security. His 10-years overseeing security coincided with China's hosting of the Olympics, which saw some overseas visitors complain about delays owing to security checkpoints, but the event concluded without any significant disruptions. Within the public security world, Zhou was credited with streamlining the police structure and making the force more professional and powerful. He also took the unprecedented step of sacking hundreds of police officers to stamp out a drinking culture, earning himself prestige within the force and the approval of top leaders. But he showed he could be ruthless in dealing with external threats to the party. His ministry tightened its grip on the Falun Gong, ethnic groups, rights activists and other "subversive forces". Before Bo's downfall on charges of bribery, embezzlement and abuses of power, Zhou was among the few leaders to openly support his leftist campaign in Chongqing. Zhou made a last-ditch effort to support Bo before he was sacked on March 15, last year, attending a Chongqing delegation session at the annual National People's Congress on March 8, where he spoke highly of the municipality's achievements. But the support failed to turn the tide. Zhou's growing unpopularity was underscored by a petition from a group of elderly party members in Yunnan, calling for his sacking in May last year, and an ensuing investigation by the party's central disciplinary body into possible irregularities in Zhou's career. Speculation has been rife in recent months over Zhou's fate after several of his former aides in Sichuan fell from grace, including a former Sichuan vice-governor and ex-top aide, Guo Yongxiang. ^ top ^

Police seize thousands in crackdown on online crimes (Xinhua)
2013-09-01
Chinese police have captured 2,120 suspects involved in online drug-related crimes and confiscated 268 kilograms of narcotics in a special crackdown, the Ministry of Public Security announced Sunday. "Further investigations into these crimes are still underway," said a statement from the ministry, adding that 11 drug making workshops were also destroyed and 7.93 tonnes of precursor chemicals were confiscated in the operation. According to the ministry, cases involved in the crackdown occurred in multiple province-level regions and were characterized by "highly covert criminal methods, tight-knit organizations and having seriously harmed Internet security and social order." In one specific case uncovered by police in east China's Jiangsu Province, a huge number of drug abusers were asked to perform drug-taking in front of a web cam via an online video website. The case led to the arrest of 651 suspects in 29 province-level regions. "The Internet has been used as a 'schoolroom' for drug crimes and a market for drug deals by criminals in recent years," said the statement, adding that the police will strengthen Internet patrol and continue the crackdown on online drug-related crimes. ^ top ^

Former oil company chief and protégé of ex-security tsar Zhou Yongkang is latest graft probe target (SCMP)
2013-09-02
The head of a cabinet agency overseeing the 100 largest state-owned enterprises is being investigated for corruption in what appears to be a widening probe into the state oil industry - a key powerbase of former senior party leader Zhou Yongkang. Jiang Jiemin, director of the State-owned Assets Supervision and Administration Commission (Sasac) and former chairman of the country's biggest oil company, is suspected of "serious discipline violations", Xinhua reported yesterday, using the party's euphemism for graft. The inquiry is the first against a ministerial-level official and a full member of the party's 205-strong Central Committee since a leadership reshuffle that began last November. Jiang was appointed to the cabinet-level post in March and was previously chairman of China National Petroleum Corporation (CNPC). The probe comes days after similar probes against four current CNPC executives were announced. Zhou was a long-time executive of the oil company before becoming the country's security tsar and a member of the Politburo Standing Committee. Jiang, 58, is a prominent protégé of Zhou's and the investigation could provide further evidence against Zhou, who retired last November. The South China Morning Post first reported on Friday that party leaders under President Xi Jinping had approved an unprecedented corruption probe into Zhou. The investigation will focus on Zhou's time as CNPC general manager and then as Sichuan party chief, a period stretching from 1988 to 2002. Jiang enjoyed a meteoric rise at CNPC during Zhou's decade at the company, working at several subsidiaries before becoming a vice-president of the company's listed arm in 1999. He left to serve as vice-governor of Qinghai, but returned as deputy manager of the oil giant in 2004. He was promoted to general manager in 2006 and became chairman in 2011. The Central Committee for Discipline Inspection (CCDI) investigation into Jiang comes just days after the authorities announced similar probes into four senior CNPC officials, including deputy general manager Wang Yongchun, a former Jiang aide at CNPC. Wang oversaw the company's human resources department and rose through the ranks while Jiang was at the helm. The investigations have been seen by some analysts as a move by Xi and Premier Li Keqiang to weaken state monopolies in strategic industries. Li, who heads the State Council, has reportedly sought greater competition in the industries, but has met resistance from powerful state-owned enterprises. A CNPC official, who declined to be named, said the investigations had thrown the company into chaos that was expected to last for months. "Because the big guys have been targeted in the investigations, a lot of middle-level officials could also be implicated subsequently," the official said. A source close to the CCDI told the Post the probe would focus mainly on Jiang's tenure as deputy director of the Shengli Oilfield in Shandong province in the 1990s. Yesterday, the top story on the Sasac website was about Jiang's visit to the Aviation Industry Corporation of China on Tuesday, his most recent public appearance. Jiang was elevated to the Sasac post despite questions about CNPC's role in efforts to help cover-up a Ferrari crash in Beijing last year that killed the only son of Ling Jihua, who was chief of staff to then-president Hu Jintao. The Post reported in November that Jiang was questioned about tens of millions of yuan transferred from CNPC to the families of two women injured in the crash. ^ top ^

Discipline bodies launch website (Global Times)
2013-09-03
The Central Commission for Discipline Inspection (CCDI) of the Communist Party of China (CPC) and the Ministry of Supervision on Monday jointly opened an official website, offering the public a new online channel to report corrupt officials. The website will play a key role in combating corruption by releasing official statements and providing a new means for online corruption reporting, read a notice on the site. "This is a great move for the Party to push forward the online anti-corruption drive, as it allows Net users to report corrupt officials via a new channel, instead of merely posting exposés on Weibo," Li Danyang, a research fellow on public administration with the Beijing-based Beihang University, told the Global Times. The website consists of 10 sections, including an online forum where the public can leave their opinions and proposals, as well as ask questions about anti-corruption work. It also outlines the discipline watchdog's structure, giving the public more information on how the agency operates. "This move indicates that this body is no longer a mysterious institution to the public like it used to be," Li said, adding that in order to be more transparent, the website should publish the reports online. Wang Qishan, Party secretary of the CCDI and a member of the Standing Committee of the Political Bureau of the CPC Central Committee, visited the website on Monday, urging disciplinary officials to learn how to use the Internet to combat corruption and use it well. Since the 18th National Congress of the CPC, the new leadership has shown its determination in rooting out corruption and vowed to crack down on both "tigers" and "flies," a description of officials at both senior and grass-roots levels alike who commit major and minor graft crimes. An anti-corruption plan from 2013 to 2017, passed by the Political Bureau of the CPC Central Committee in August, stressed that curbing corruption will be the Party's main mission, calling for severe punishment for officials who breach discipline. Amid the intensified anti-corruption campaign, it was announced that Jiang Jiemin, head of the State-owned Assets Supervision and Administration Commission, was put under investigation over suspected "serious disciplinary violations" on Sunday. His downfall is the latest following those of eight officials at the ministerial and provincial level since the Party congress. "Annually, there are about six to eight provincial level officials investigated on average, and it has been rare to see so many such cases in such a short time," He Zengke, chief of the Institution of Marxism in Central Compilation and Translation Bureau, was quoted by the Beijing News as saying. "This high frequency shows the new leadership is making the greatest efforts in eradicating corruption.". ^ top ^

Xi Jinping rallies party for propaganda war on internet (SCMP)
2013-09-04
President Xi Jinping has issued a call to arms against the country's unruly internet, ordering the Communist Party's propaganda machine to build "a strong army" to "seize the ground of new media". Xi's remarks, made during a national meeting of propaganda chiefs in Beijing last month, came just as the central government was stepping up its campaign against internet "rumours" and reining in influential online celebrities who can command millions of followers. The August 19 speech was reported the next day by the state agency Xinhua, but it is only in recent days that some of Xi's more combative remarks have come to light. The comments were confirmed by senior media sources who were summoned to internal briefings on the keynote speech in the past week. "The wording of his speech relayed in internal briefings is far stronger," said a source. "The most impressive [point] is that Xi said the Communist Party should be combative, instead of being passive, and it should wage a war to win over public opinion. Xi also ordered the propaganda apparatus to form a strong internet army to seize the ground of new media," he said. The speech laid the ground for recent events that shook the new-media world. On August 20, Beijing police detained several people connected with Beijing Erma Interactive Marketing and Planning, including internet celebrity Qin Huohuo, on suspicion of rumour-mongering. On August 23, Chinese-American businessman Charles Xue Biqun, better known to his 12 million Sina Weibo followers as Xue Manzi, was detained on suspicion of soliciting prostitutes. For the past two weeks, state media have rolled out one commentary after another warning "big V" internet celebrities - people whose identities have been verified by social media companies - not to misuse their influence by spreading rumours. Media sources said Xi's August 19 speech ordered officials to "unite all intellectuals". The remark was interpreted as meaning mustering as many intellectuals as possible to back the party's agenda. "It is a continuation of the style during the Maoist era to set intellectuals apart from the public," one senior state television journalist said. Another media source said Xi also highlighted the ban on the media spreading the "universal values of the West", because there are "no such things as universal values". Mainland universities have been banned from teaching "universal values", such as press freedom and civil rights, since March. Xi also called for the revival of an "ideological purification" campaign initiated by late leader Deng Xiaoping in the early 1980s by upholding "four cardinal principles", said a website of the publicity department of the party's Central Committee. The principles call for the upholding of the people's democratic dictatorship, the socialist path, the party leadership and Marxism-Leninism and "Mao Zedong thought". "It shows the controls will get stricter and the room for media will dwindle further," the second media source said. ^ top ^

Trial for six graft-busters who 'tortured official with ice-water' before he died (SCMP)
2013-09-05
Six Communist Party investigators are expected to stand in a rare trial in Zhejiang province over the death of a senior executive at a state-owned firm who was allegedly tortured during a disciplinary probe earlier. The suspects were arrested and charged with intentional assault relating to the unexplained death of Yu Qiyi, a 42-year-old chief engineer of the state-owned Wenzhou Industry Investment, who died on April 9 in a hospital after he was detained for 38 days on suspicion of bribery. The suspects include five employees of the local Discipline Inspection Commission in Wenzhou and an officer seconded from the local prosecutor's office. The prosecutor has accused them of torturing Yu by repeatedly putting his head into a bucket of iced water during questioning, according to a copy of the indictment obtained by the South China Morning Post. "The method of torture was extreme, and the investigators had no right to treat their fellow comrade this way," said Si Weijiang, a Shanghai-based humans rights lawyer hired by Yu's family. Si said the trial could start as early as next week. The discipline inspection units, which investigate corruption and other offences by party members, can hold suspects indefinitely under shuanggui, a system of detention and interrogation outside the regular legal system. It is rare for investigators to be charged over inappropriate behaviour on the job. Yu's widow said she saw her husband alive at Beijing Capital International Airport on March 1, when he saw her off on a flight home to Wenzhou. Days later, she received a phone call from his company to say that Yu had been detained for suspected "discipline violations". Yu is among a number of junior-level officials who have reportedly endured violent treatment under investigation. His death has raised public concerns about the secretive operations of the discipline investigators, especially as the top leadership cracks down on official corruption. [...] Some 160,000 cadres were punished by the Central Commission for Discipline Inspection last year, party officials said in January. ^ top ^

China aiming to tame weather (China Daily)
2013-09-05
Man can conquer nature, so goes an ancient Chinese saying that highlights human power. In a move appearing to support that saying, China plans to boost its weather intervention through a national plan. The plan, running from 2013 to 2020, will divide the country into six regions and set up an interprovincial mechanism for weather control, Yao Zhanyu, a senior researcher of the Weather Modification Center under the China Meteorological Administration, told China Daily. Each region will build infrastructure and a command center for weather intervention, according to Yao. Programs in northeastern, central and southeastern areas will be used mainly to guarantee the wheat harvest, and the northwestern program will be for environmental protection, Yao said. He added that the southwestern program will focus on ensuring the operation of agriculture and hydropower, while the northern program will be concerned with guaranteeing water supplies. China modifies weather mainly to increase rain or snow and prevent damaging weather such as hail, fog and rainstorms. Cloud seeding is the major weather modification activity in China. According to Yao, the northeastern region — covering Liaoning, Jilin and Heilongjiang provinces and parts of the Inner Mongolia autonomous region — was selected as a pilot area to test the coordination system after the National Development and Reform Commission approved a feasibility report in May 2012. The report said the project will invest nearly 1.1 billion yuan ($177 million) by 2014 to build a regional weather intervention system in northeastern China, including 12 weather intervention airplanes and ground-based facilities. Yao said a feasibility report for the northwest started recently and the program is expected to be launched within one year if everything goes well. The northwestern area, including Gansu province, the Ningxia Hui autonomous region, the Xinjiang Uygur autonomous region and parts of Inner Mongolia, is the main source of the sandstorms in spring and autumn. To better meet agricultural demand and relieve disasters, China plans to increase annual precipitation by 60 billion metric tons and extend the coverage of artificial hail suppression to more than 540,000 square kilometers by 2020, according to the State Council. "Cloud seeding to coax rain can relieve agricultural drought, reserve water for lakes, cool down high temperatures and ease pollution," Yao said. [...]. ^ top ^

'Catastrophe' as 114 million Chinese suffer diabetes thanks to economic boom (SCMP)
2013-09-05
About 11.6 per cent of adults in mainland China, or 114 million people, suffer from diabetes, a comprehensive nationwide survey on the disease shows. It means that almost one in three diabetes sufferers globally is in China, a development one world expert on the disease called a catastrophe. It is now more common in China than in the US, where 11.3 per cent of adults are diabetic. The number of diabetics on the mainland shot up by 22 million, the equivalent of Australia's population, between 2007 and 2010, according to the study, published in the Journal of the American Medical Association. Rapid changes in lifestyle are the key factor. American diabetics are usually overweight, but those on the mainland are not, the researchers found. "Diabetes may have reached an alert level in the Chinese general population, with the potential for a major epidemic of diabetes-related complications, including cardiovascular disease, stroke, and chronic kidney disease," wrote the research team, led by Guang Ning from the laboratory for endocrine and metabolic diseases at the Ministry of Health. "Poor nutrition in utero and in early life combined with overnutrition in later life may contribute to the accelerated epidemic of diabetes in China." The report is based on a survey of a nationally representative sample of 98,658 adults in 2010. A similar survey in 2007 pegged diabetes prevalence at 9.7 per cent, or 92.4 million adults. Almost two-thirds of patients treated for diabetes did not have adequate blood-sugar control, the authors found. For every mainlander diagnosed with diabetes, at least two more will be unaware they have it. "China is now among the countries with the highest diabetes prevalence in Asia and has the largest absolute disease burden of diabetes in the world," the researchers wrote. Dr Chan Wing-bun, clinical director of Chinese University of Hong Kong's Diabetes and Endocrine Centre, said: "The most alarming part of the finding is the extremely rapid increase." Chan said that when a poor society becomes richer, changes in diet and lifestyle mean that many people will develop diabetes. After a while, people become health-conscious and the rate falls. [...]. ^ top ^

Former Shaanxi official Yang Dacai is jailed for 14 years (SCMP)
2013-09-06
A former Shaanxi official was sentenced yesterday to 14 years in prison for corruption, in a case that started when outraged internet users posted photos of his expensive watches. Yang Dacai, the former work safety chief of Shaanxi province, was found guilty of taking bribes of 250,000 yuan (HK$314,000) and holding more than five million yuan in unexplained assets, the Xian Intermediate People's Court said in a verdict that was reported by Xinhua. For the bribery conviction, Yang, 56, was sentenced to 10 years in jail and fined 50,000 yuan. He received an additional six-year prison term for amassing unexplained wealth, which his family must forfeit. The court decided to shorten the combined prison term to 14 years. Yang did not appeal against the verdict. The sentence came six days after Yang pleaded guilty to the charges. Yang said after the sentencing that after decades of hard work, he had turned to crime but now sought a fresh beginning, Xinhua reported. "It is useless to repent after falling into the abyss of crime, but I sincerely want to confess and regret the crime I committed, and beg the court to give me a brand new start in life," he said. Yang was removed from his post in September after a picture of him grinning at the scene of a bus crash that killed 36 people circulated online and aroused public indignation. He later said he only smiled in an attempt to comfort his colleagues who were under stress in the aftermath of the accident. But sharp-eyed internet users noticed Yang's penchant for wearing expensive watches and dug up photos of him wearing at least 11 different luxury watches on various occasions. Yang's habit earned him the nickname "Brother Watch". Yang claimed that he bought the watches with his own salary and that some of the watches were borrowed from his son. An investigation found that he "seriously violated the party's discipline rules". During a one-day trial last week, prosecutors told the court that Yang's huge fortune was far beyond the possible income of a public servant at his level, who would normally be paid a monthly salary of a few thousand yuan. The five million yuan in unexplained funds "probably" came from "presents from junior officials and old school friends during festivals", Yang said previously, mainland media reported. Social media have become major platforms contributing to the downfall of corrupt officials on the mainland. A number of officials have been punished after online exposure of their wrongdoings. Among them are Lei Zhengfu, a district-level party chief in Chongqing, and Shan Zengde, a deputy chief in charge of Shandong's agricultural industry. Both were sacked after being exposed online for sex-related scandals. ^ top ^

Chinese capital urged to take lead in air pollution treatment (Xinhua)
2013-09-03
The Chinese capital Beijing should take the lead and make breakthroughs to prevent and treat air pollution by prioritizing environmental protection, Chinese Vice Premier Zhang Gaoli said on Tuesday. The vice premier made the remarks during an inspection tour on air pollution prevention and treatment in the city, which is often subject to smoggy conditions. Coal for winter heating, vehicle control, and dust treatment were listed as the three main tasks in improving the city's environment. Zhang said the capital should cut carbon emissions by opting for high-quality coal, electricity, and natural gas for winter heating. Zhang said the city should also control the total number of vehicles, eliminate high-polluting cars, promote new energy vehicles, and explore new traffic management methods so as to cut nitrogen oxides emissions. Meanwhile, efforts should be enhanced in dust treatment and law enforcement to control particles, Zhang said. During his tour, Zhang inspected heating and power plants and environmental monitoring stations in the city, then presided over a workshop with local officials on air treatment. Li said that as industrialization and urbanization picks up rapidly, China faces a daunting challenge in air pollution that has grown ever more complicated. The air quality in Beijing, for instance, has fallen a long way behind people's expectations. "The strengthening of treatment efforts can no longer wait," Zhang said. Beijing on Monday unveiled a package of measures, including cutting vehicle emissions and curbing industrial pollution, in a bid to improve air quality in the city. The package is part of an action plan by the municipal government, which has pledged to reduce PM 2.5 density by 25 percent or more by 2017. Local transport authorities also said on Tuesday that they will reduce car registrations from next year in a bid to clean up the city's air and ease traffic congestion, with a new limit on registrations expected to be announced in late November. ^ top ^

Shanghai vice mayor Ai Baojun to head up free-trade zone later this month (SCMP)
2013-09-04
Shanghai is scheduled to officially launch its free-trade zone, the first on the mainland, this month with a city vice-mayor heading up the project. Government sources familiar with the plan told the South China Morning Post that it will launch on September 27, when senior central government officials will fly to the city to attend a ceremony planned to mark the occasion. Ai Baojun, currently a vice-mayor of Shanghai in charge of the city's economic and industrial development, will be named the head of the new commission to oversee the development of the free-trade zone, according to the sources. Ai used to head Shanghai-based Baosteel, China's biggest steelmaker, before he was named vice-mayor in late 2007. He would keep the vice-mayor post but spend more time on the free-trade zone, said the sources. The new role for Ai is seen as a big responsibility that could pave the way for his elevation to more important positions in the future. Premier Li Keqiang could assign one of his direct subordinates, most likely a vice-premier, to work closely with Ai to fast-track decisions on the zone. "There will be a green channel for the free-trade zone to communicate directly with the cabinet so a lot of bureaucracy can be cut out and decisions can be implemented rapidly," said one source who declined to be named because of the political sensitivity of the matter. If all goes according to plan, the Shanghai free-trade zone will be up and running less than three months after Li first announced his intention to create it. The project should help to showcase Li's economic reform-based philosophy, coined "Likonomics", which Barclays economists describe as a three-pronged strategy: no stimulus, deleveraging (reducing the percentage of debt) and structural reforms. Some analysts say Li's personal involvement in pushing the project along is the clearest sign yet that the nation's leadership is determined to deliver long- mooted economic reforms. Investors say Li must deliver on economic reform or risk seeing three decades of rising prosperity slip into reverse. But those reforms are not without their own challenges. They will throw long-protected areas of the economy directly into the path of efficient global competitors. Li fought open opposition from financial regulators to push through the Shanghai plan, losing his temper at one meeting inside party headquarters at Zhongnanhai, which was reported by the Post on July 15. Late last month the government announced the final approval for the special zone, which will span 28.78 sq km in Shanghai's Waigaoqiao, Yangshan and Pudong districts. State media have compared the importance of the free-trade zone with that of the Shenzhen special economic zone that was crafted under the personal supervision of Deng Xiaoping about 30 years ago. ^ top ^

Shanghai free-trade zone may be extended to cover all of Pudong (SCMP)
2013-09-05
The central government may eventually expand its proposed Hong Kong-like free-trade zone in Shanghai to cover the entire Pudong district, government sources say. Late last month, Beijing approved the mainland's first such zone, which will span 28.78 square kilometres in the Pudong New Area, including the Waigaoqiao duty-free zone and Yangshan port. The entire Pudong district covers 1,210.4 sq km. Government sources familiar with the plan told the South China Morning Post that the government initially considered declaring that the new free-trade zone would take in all of Pudong. "Officials and scholars discussed the possibility of making the entire Pudong New Area a new free-trade zone," said one of the sources, referring to the official name of the district. They later agreed to focus on smaller areas within the district as they wanted to make sure that the launch would be smooth and successful, said the source, who declined to be named because of political sensitivities. The Post exclusively reported on Tuesday that the Shanghai free-trade zone would be launched on September 27, when senior central government officials will visit the city for a ceremony to mark the occasion. It is understood that Premier Li Keqiang personally endorsed the plan to launch the zone in Shanghai, rather than in Tianjin or Guangdong, which had also lobbied for the central government's approval. "The reason why the top leaders agreed to launch the free-trade zone first in specific parts of Pudong was mainly because of financial industry risks related to offshore banking and concerns about hot money inflows," a government source said. The Post reported in July that Beijing would allow foreign banks to set up wholly owned units in the zone, mainland banks could offer offshore banking business and foreign commodities exchanges and trading companies could own their warehouses there."You need to make sure if those risks happen, you can get them under control. From that perspective, Pudong is way too big and it would be far more difficult to control such potential risks than to deal with just several specific parts of Pudong district," the source said. "But it's always a good option to expand further to cover all of Pudong if the free-trade zone can be worked smoothly in its early stages." [...]. ^ top ^

Inland region 'key' to growth (China Daily)
2013-09-05
Premier Li Keqiang has identified China's inland areas as "the biggest space" for the nation's development. Li made the remarks in a pavilion tour during the 10th China-ASEAN Expo in Nanning, capital of the Guangxi Zhuang autonomous region. The city serves as a key gateway connecting China and its neighbors to the southeast. The east-to-west shift is the trend for economic development, said the premier, as China's opening up follows the path that extends from the coast to the inland regions. While maintaining the quality of growth in coastal areas, Li said much attention should be paid to exploring the possibilities of development in inland areas. "It is therefore an inevitable choice to bolster the development of the three emerging economic powerhouses: the old northeast industrial bases, the middle and western regions adjacent to the Yangtze River and the southern and middle-western hinterlands," Li said. The premier voiced the hope that the northwest areas will also become new frontiers in the regional opening up. [...] Accompanied by local government authorities and residents, Li on Tuesday began his first trip as premier to the 10th anniversary expo, which attracted more than 2,300 companies from China and the Association of Southeast Asian Nations. The expo has become an important platform to promote trade and relationships. With Li at the wheel, a simulated transportation graphic portrayed a dense network of cruise routes connecting Guangxi's Qinzhou port and 10 ports around ASEAN. Better connectivity between China and ASEAN can only be achieved through intensified infrastructure development, which removes the final barrier to technology transfer and person-to-person contact, said Huang Hao, sales director of Guangxi Sacred New Energy Co Ltd, who was present at the event. [...] To deepen pragmatic economic cooperation, Li proposed "an upgraded version" of the China-ASEAN Free Trade Area, adding that the Chinese side will strive to expand bilateral trade to $1 trillion by 2020 and increase bilateral investment by $150 billion during the next eight years. ^ top ^

Universal suffrage is HK goal: top legislator (Xinhua)
2013-09-03
The ultimate aim of political system development in Hong Kong is implementing universal suffrage, Zhang Dejiang, chairman of the National People's Congress (NPC) Standing Committee, said on Tuesday. Meeting with a delegation of security units of the Hong Kong Special Administrative Region (HKSAR), Zhang said that democracy will be put forward actively, steadily and appropriately in Hong Kong, in accordance with the Basic Law and resolutions of the NPC, working toward universal suffrage. Hong Kong needs a stable and harmonious social environment for developing the economy and improving people's lives, carrying out political reform and promoting democracy, which is the fundamental interest of Hong Kong people, he said. In the meeting, the top legislator spoke highly of the SAR's success in maintaining a prosperous and stable situation ever since China resumed exercise of sovereignty over Hong Kong in 1997. He attributed it to a "substantial implementation" of the principle of "One country, two systems" and the Basic Law of the HKSAR. The central authority is satisfied with the work of the HKSAR Government and its new chief executive Leung Chun-ying, said Zhang, who is also a member of the Standing Committee of the Communist Party of China Central Committee Political Bureau. Zhang described Leung's team as "working hard to develop the economy, improve people's lives, focusing on current issues while planning for long-run issues, maintaining stability while seeking progress, being practical and making achievements." The status of Hong Kong depends on its economic development, and it is the SAR Government's primary job to maintain economic prosperity, he stressed. In his speech, Zhang reiterated the stance of the central authority on the development of political system of Hong Kong, saying that its principal stance is persistent and clear, namely the development must adhere to the principles of "One country, two systems," "Hong Kong People governing Hong Kong," and a high degree of autonomy. The top lawmaker praised the HKSAR's security units for their role in safeguarding national and regional security as well as Hong Kong's law governance, social stability and serving local residents. He urged security departments of Hong Kong and the inland to step up exchanges and cooperation, and "make new, greater contributions to promoting the undertaking of 'One country, two systems.'" Zhang also informed the visitors of the development of national political and law-governance systems. ^ top ^

China-ASEAN cooperation drives investment westward (China Daily)
2013-08-31
Businessman Wu Jinpei says that moving business from developed eastern China to the southern Guangxi Zhuang autonomous region seemed unwise a decade ago, but has become a "far-sighted" decision. Wu moved his candy business from coastal Fujian to Guangxi in 2012 to ride the wave of deepening cooperation between China and the Association of Southeast Asian Nations (ASEAN). "We invested in Guangxi because the region is a gateway to the ASEAN, which provides great geographic advantages and potential markets," said Wu, general manager of the Golden Crown Candy Food Guangxi Co., Ltd. "We expect to open up the ASEAN market with the help of close China-ASEAN relations and the favored location of the Beibu Gulf," said Wu. China and ASEAN have had an established strategic partnership since 2003, and it has proved successful over the past decade, with the two-way trade volume in 2012 exceeding $400 billion, about five times that of 2003. Customs data show that foreign trade between Guangxi and the ASEAN surged 38.6 percent year on year to 7.51 billion U.S. dollars in the first half of 2013, and the ASEAN has been Guangxi's biggest trade partner for 13 years in a row. This backdrop has lured many businesses like Wu's to extend their branches in Guangxi. Wu Xingqiang, head of the Fujian Chamber of Commerce in Guangxi's Pingxiang city, near the China-Vietnam border, is among the first group of business people there to have made their fortunes and witnessed the development of this port city. "When I first came here in 1996, there were only a dozen businessmen from Fujian and the market was small," Wu said. "But now more than 1,000 Fujian merchants have gathered in this tiny city and the number is growing." Hong Kong-based Jing Guang Electronics Co., Ltd. has been producing capacitor products for years in the cities of Shenzhen and Zhuhai in Guangdong province, the nation's economic powerhouse. Pressured by skyrocketing labor and land costs, the company moved westward to build two factories in Guangxi's Beihai city in 2008. Now the business is expanding. A manager of the company said that it chose to move to Guangxi both to reduce costs and to explore new opportunities and markets as China-ASEAN cooperation continues to deepen. Xu Ningning, deputy secretary-general of the China-ASEAN Business Council, said that as more have realized Guangxi's role in China-ASEAN cooperation, many companies are pinning their hopes on Guangxi and the future of China-ASEAN cooperation. ^ top ^

Reforms urged for pharma industry (China Daily)
2013-09-04
Experts have called for reforms of public hospitals and more legislation on the pharmaceutical industry, after police revealed more details on Tuesday of suspected financial violations by GlaxoSmithKline China. The British pharmaceutical giant has been under investigation since early July over suspected bribery and tax-related violations, more details of which have been provided recently by company employees, according to the website of the Ministry of Public Security. According to police investigators, the pharmaceutical company had "indulged" in the bribery of doctors — or at least "given tacit permission" — saying that individual employees were responsible for transgressions. Chinese authorities have detained four Chinese GSK executives on allegations that employees paid nearly $490 million in bribes through travel agencies to hospital officials and doctors with the aim of boosting sales of pharmaceutical products. Huang Hong, general manager of GSK's business operations in China, told Xinhua News Agency that the company set an annual growth target of 25 percent, which is 7 to 8 percent higher than the industry average. The "irrational" target was impossible to accomplish without violating regulations, she said. Meanwhile, a sales team covering the company's major customers was expanded from less than 10 members to more than 50 over the past five years, and was allocated almost 10 million yuan ($1.63 million) of "public relations funds". This money was allegedly used to maintain close ties with key staff members in charge of the allocation of drugs in major hospitals, to ensure that GSK products would be prescribed by doctors. As of Tuesday night, China Daily had not received a response to the allegations from GSK China. However, the bribery allegations against GSK China reflect what many consider to be widespread practice in the pharmaceutical industry across the country, and experts are calling for swift legislation and reforms to prevent similar cases. "It (the alleged bribery by GSK China) was only the tip of an iceberg. Such behavior is common among domestic pharmaceutical companies as well," said Wang Yaoguang, director of the pharmaceutical law institute at Tsinghua University. [...] Wang said the solution to the problem lies in the establishment of an industry regulation that guides the drug purchases of hospitals, enabling an open channel through which drug companies can pitch their products. Yu Mingde, chairman of the China Pharmaceutical Enterprises Association, echoed Wang's claim that bribery of doctors is a common practice for pharmaceutical companies seeking to increase their sales. However, he said he believes that a solution to the issue of corruption lies in reform of the public hospital system to ensure the incomes of doctors. [...] The police investigation of GSK is part of a wider campaign by the central authority to crack down on commercial bribery inside the pharmaceutical industry. ^ top ^

Russia's Gazprom and CNPC agree terms on massive gas deal (SCMP)
2013-09-06
Russian gas giant Gazprom and China National Petroleum Corporation yesterday agreed to basic terms on a long-awaited deal to deliver natural gas to China, paving the way for a final deal to help meet the country's soaring energy demands. Pressure on Gazprom to venture into the Chinese market has risen. Its Russian rivals, such as Novatek, have secured deals to supply China with gas from still-unfinished liquefied gas plants and are lobbying to limit Gazprom's export monopoly. Gazprom's key market has remained the European Union, whose core member states started receiving gas from the former Soviet Union in 1968. Some 55 per cent of the company's profit comes from the bloc. But cash-strapped European firms have increasingly sought to move away from energy dependence on their home countries' former cold war foe, looking for cheaper fuel, such as liquefied natural gas. Gazprom, meanwhile, has been involved in painstaking - and so far fruitless - talks about supplying China and diversifying its deliveries away from Europe. The basic terms - signed by Gazprom and CNPC chiefs in the presence of President Xi Jinping and his Russian counterpart, Vladimir Putin - "define the volumes, start of deliveries, payments," and other issues, Gazprom said. Gazprom first signed a memorandum of understanding with China in 2006 to ship up to 68 billion cubic metres (bcm) of gas per year via two routes, later prioritising a route which would take 38 bcm per year. However, talks on finalising a deal have been delayed repeatedly over numerous differences, including pricing. The gas prices, which are usually linked to oil prices, may include a spot portion to reflect the fluidity of the liquefied gas market. Gazprom has said it aims to supply China with 38 bcm per year from its fields in eastern Siberia. That compares with 152 bcm it expects to supply to Europe this year. Gazprom chief executive Alexei Miller said the companies plan to sign the final supply deal by year-end. ^ top ^

Satellite spots construction at North Korean rocket launch site (SCMP)
2013-09-01
Fresh satellite imagery shows North Korea has embarked on a major new construction programme at the facility where it launched a long-range rocket in December, a US research institute said. The construction includes what could be a new launch pad for testing mobile ballistic missiles, the US-Korea Institute at Johns Hopkins University posted on its 38 North website on Friday. Work has been under way at the Sohae Satellite Launching Station, or Tongchang-ri, since mid-year, it said. The station near the northwest coast was the base for the country's successful Unha-3 rocket launch in December, which was widely condemned in the West as a disguised test of a long-range ballistic missile banned under United Nations resolutions. As well as a new road, the rebuilding of a compound for troops and the restart of construction on a permanent radar tracking system, the new satellite imagery appears to show construction of a new launch pad, the website said. "While it is too early to identify the exact purpose of this site, one possible explanation is that Pyongyang is building a 'flat launch pad', a large concrete area that would be used to test mobile ballistic missiles fired from a transporter-erecter launcher," it said. "Alternatively, a modified version of the KN-08 long-range mobile missile could launch small satellites from the pad, although this would probably require a more complex arrangement. "Rockets fired from this location … could travel over 4,000 kilometres before encountering a foreign land mass. This would allow full tests of North Korea's Musudan rocket." The Musudan is a mid-range rocket suspected to have a range of more than 3,000 kilometres, while the KN-08 has a potential intercontinental range and was first displayed on parade in April last year. The work at Sohae and a halt last year to construction at the Tonghae facility make it "unlikely that North Korea will test-fire an Unha or other space launch vehicles over the next six months", the website said. Despite UN sanctions, North Korea has repeatedly made it clear that it intends to pursue a missile programme. ^ top ^

North Korea cancels US envoy's visit for talks over detainee Kenneth Bae (SCMP)
2013-09-02
North Korea said it rescinded its invitation for a US envoy to visit the country to seek the freedom of an American detainee because the US flew B-52 bombers over the Korean peninsula. The moves signal that possible informal talks between the two countries over detainee Kenneth Bae were not going smoothly, with Pyongyang seeking concessions from Washington in return for releasing him, analysts said. Bob King, the US special envoy for North Korean human rights, had been scheduled to travel to Pyongyang on Friday for talks on Bae, a 45-year-old tour operator and Christian missionary who has been detained since November for committing "hostile acts". He was sentenced in April to 15 years of hard labour. A North Korean Foreign Ministry spokesman said his country had intended to allow King's visit despite the US and South Korea conducting annual military drills. But he said the US "beclouded the hard-won atmosphere of humanitarian dialogue in a moment" by allegedly flying B-52H strategic bombers over the peninsula during the exercises. He called it "the most blatant nuclear blackmail". Analysts say North Korea has previously used detained Americans as bargaining chips in its stand-off with the US over its controversial nuclear and missile programmes. ^ top ^

Domog Folk Band wins Grand Prix in World Championship of Folklore (UB Post)
2013-09-02
Mongolia is now delighted with brilliant news. Domog Folk Band has won the Grand Prix of “Golden Orpheus,” which is a gold medal and certificate of “Absolute World Champion of Folklore” from “World Folk 2013” World Championship of Folklore. The event took place from August 22 to September 1 in Nessebar, Bulgaria. The band magnificently awed the world audience with Mongolian folk art and raised the Mongolian flag to the highest. The band also brought with them Mongolian traditional dancers, long song singers, and contortionists. What's more, State Prized Artist of Mongolia D.Sosorbaram, who directed the six performances in the championship, is set to obtain the rank of “Maestro” from the World Folk Academy. The championship was organized by the World Association of Folklore Festivals, European Association of Folklore Festivals, World Folklore Academy, and other organizations under the support of UNESCO and the involved municipalities. It has been organized for the third time this year with 98 folk bands from 24 different countries participating. ^ top ^

West Tsankhi site will start to export coal soon (Montsame)
2013-09-03
The "Erdenes Tavantolgoi" company has announced that it will begin export coal this Thursday from the mine's West Tsankhi site. Opened three years ago, the East Tsankhi field exported one million tons of coal in 2011, and 2.5 million tons--in 2012, and has exported 2.6 million tons so far. Nowadays, the TT mine is attracting many companies while informal news has been flowing about the economic crisis in Mongolia due to stopping of the Oyu Tolgoi underground mine. The “Erdenes TT” plans to export 7.5 million tons of coal this year, of which 4.5 million tons will be extracted from the East Tsankhi, and 3-3.5 million tons--from the West Tsankhi site which opened this February. Income from the coal export from the West Tsankhi will be placed in the state budget, and it will give big impetus to the national economy, said Ya.Batsuuri, an executive director of the “Erdenes TT” company in interview to the “Undesnii Shuudan” daily. According to officials, a half of the coal transportation at the East Tsankhi is being performed by some ten local companies under contracts. They will transport 300 thousand tons of coal each until end of this year from the East Tsankhi site. Moreover, branches of the Chalco company will participate in transporting of the 7.5 million tons of coal. Coal to be extracted from the East Tsankhi will be supplied to the Chalco company. Apart of this, Mongolia has established a contract with Japan to cooperate in utilizing a technology of dry washing of coal. Accordingly, 2,000 tons of coal will be sent to Japan this month to test this technology. If it turns to be positive, a small-sized plant of the coal dry washing will be erected next year. The project on it has been approved by the Ministry of Mining, and is is expected that a bid will be announced this year and a construction will launch early 2014. Some 100 new jobs have been created in the TT mine thanks to three-time increase in productions at the “Erdenes TT” company. ^ top ^

Mongolia-Russia's Altanbulag-Kyakhta border crossing to be operational 24 hours a day (Info Mongolia)
2013-09-04
Minister of Foreign Affairs L.Bold familiarized with the operations of Altanbulag Port on the Mongolia-Russia border on September 02, 2013. Minister L.Bold met and exchanged views with Selenge Aimag authorities and border control organization operating at the Altanbulag Port about making preparations to implement the mutual principal agreement to transfer the Altanbulag-Kyakhta border crossing to a 24/7 operation. He also visited Russia's Kyakhta (Khiagt) port and was introduced with the blueprints of the new exit-entry roads to connect the two ports. Making the Altanbulag-Kyakhta border crossing operational for 24 hours a day will have a positive impact not only on the trade and economic cooperation of the two countries, but also on the foreign trade of regional entrepreneurs near the border and allow the citizens of the two nations to travel more freely. ^ top ^

Discover Mongolia-2013 begins (news.mn)
2013-09-05
The “Discover Mongolia-2013” International Mining Investors Forum begins at the Mongolian Children"s Palace in Ulaanbaatar today on September 5th. The Mongolian National Mining Association, Ministry of Mining of Mongolia and Prime Info LLC are jointly organizing the annual forum this year. Only 500 participants from over 10 countries are expected to attend at the International Mining Investors Forum. In previous years almost 1000 participants from over 40 countries attended the International Mining Investors Forum. The 11th International Mining Investors Forum begins with speeches by the former President of Mongolia, P.Ochirbat and Mining Minister D.Gankhuyag. During the forum, held over two days on September 5th and 6th, there will be an Investors Exchange Exhibition that will give foreign and national companies' introductions and advertise these companies' services and products. It is designed to help the participants find good projects, reliable services, quality equipment or skilled personnel. ^ top ^

Nicola Yuste
Embassy of Switzerland