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
  4-8.4.2016, No. 617  
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Swiss president confident of China's economic prospects (China Daily)
Swiss President Johann Schneider-Ammann told Xinhua in an interview Tuesday that he had every confidence China's market will continue to play a "huge and important" role for the global market despite the slowdown observed in recent years. The GDP growth of about over 10 percent 10 years ago was in real figures a GDP growth of about $200 billion. A GDP growth of 6.9 percent last year is in real terms about $700 billion, he explained ahead of his trip to China. "In other words, the Chinese economy has gone within 10 years through a huge development, tripled its volume, and I think we are doing well if we accept the lower growth rate," he added. Switzerland, a small but prosperous nation, has enjoyed fruitful relations with China since the confederation recognized the People's Republic of China in 1950. Swiss company Schindler was in fact one of the first western companies to set up a joint industrial venture with China in early 1980s. As well as supporting China's accession to the World Trade Organization in 2001, Switzerland was also among the first countries to acknowledge China as a market economy in 2007. In light of these ties and in view of strengthening relations, a Free Trade Agreement (FTA) which came into effect on July 1, 2014 was signed between both countries to facilitate and increase trade relations while benefiting Swiss businesses which now have an improved access to China's substantial and growing goods and services sectors. The FTA is also seen as a way to secure jobs in Switzerland as well as a means to open up new opportunities for the country's export industry which has had to contend with considerable financial pressures due to the strong Swiss Franc. In addition, the confederation was one of the first participants in the region to join China-proposed new Asian Infrastructure Investment Bank (AIIB) in 2015. "Switzerland wants to stay in contact with the best performing countries all around the globe. That's why we are very much interested in establishing closer relations with China," the Swiss president highlighted while lauding China's leading role in tackling complex issues such as climate change, international political issues and peacekeeping initiatives across the globe. "We are happy to know that we are partners with the Chinese government, and we are happy to realize that the Chinese government is so engaged in such global aspects of importance," he added. The Swiss president's state visit to China will take place between April 7 and 9. ^ top ^

China, Switzerland vow to upgrade cooperation (Global Times)
Chinese Premier Li Keqiang met with Swiss President Johann Schneider-Ammann on Thursday, vowing to upgrade bilateral cooperation. China attaches great importance to developing ties with Switzerland, said Li, noting that bilateral free trade agreement (FTA) has effectively boosted economic and trade cooperation between the two countries in the past two years. The China-Switzerland FTA entered into force on July 1, 2014, which marks a milestone on the bilateral relationship. China is willing to deepen cooperation with Switzerland in areas of trade, finance and innovation, and make bilateral cooperation a model in China-Europe relations, said Li. Innovation is the only road to transformation and upgrading of the Chinese economy, while Switzerland has competitive advantage in innovation, said Li, saying bilateral innovation cooperation has broad prospect. He suggested the two countries create mechanisms for innovation cooperation between businesses, colleges and research institutes. Li also called on the two sides to strengthen the alignment of "Made in China 2025" and Switzerland's Industry 4.0 strategy, so as to ensure the two countries lead the pack in the trend of digitization and Industry 4.0. Schneider-Ammann spoke highly of the operation of the Switzerland-China FTA, saying the two countries are real cooperative partners of mutual benefit and win-win. Switzerland is ready to work with China to expand cooperation in finance, tourism and sports, and is willing to discuss with China on creating platforms for cooperation in innovation, high technology and high-end manufacturing, said Schneider-Ammann. Schneider-Ammann is paying a state visit to China from Thursday to Saturday at the invitation of Chinese President Xi Jinping. ^ top ^


Foreign Policy

Japan drags G7 into South China Sea spat (Global Times)
Apart from agreeing to sell military equipment to claimant countries and dispatching warships to "observe" US-Philippine maneuvers, Japan has decided to wade further into the South China Sea disputes by persuading other G7 nations to include territorial disputes in their communiqué. According to Japan's Kyodo News Agency, G7 foreign ministers are expected to express concern at an upcoming meeting hosted by Japan over "China's construction work and military deployment in the South China Sea." Kyodo went on to say that a statement on maritime security will be issued following the two-day meeting in Hiroshima from Saturday and that the ministers plan to voice strong opposition to "territorial claims through the use of threats or force." "It is clear that Japan is trying to wade further into the South China Sea disputes and complicate the situation despite being an outsider," Lü Yaodong, director of the Institute of Japanese Studies at the Chinese Academy of Social Sciences told the Global Times. "Its strategy is to increase its influence in the region by strengthening ties with the claimant nations. [In the eyes of China,] it comes down to one explanation, that Japan wants to contain China." Japan's move comes among concerted efforts as a UN-backed tribunal is set to announce its decision in the coming months on a legal challenge by Manila to Beijing's territorial claims in the South China Sea. Japan also signed an agreement with the Philippines in February that allows it to sell military equipment to Manila, including advanced aircraft used for surveillance missions. Last week, two Japanese destroyers, the Ariake and Setogiri, and submarine Oyashio, were dispatched to "observe" joint US-Philippines military exercises for the first time in 15 years. Analysts have also said that Japan's ambition to wield influence in the South China Sea disputes would hurt Sino-Japanese ties, which are already faltering given the Diaoyu Islands disputes, wartime history and Japan's recently enacted security laws that allow its troops to fight overseas. Japan invaded China and many other Asian countries during World War II and the security laws have unnerved countries like China and South Korea. "Tensions in Sino-Japanese relations are gradually de-escalating, but only in some areas. Confrontation between the two countries will continue to exist for a long time," Shi Yinhong, director of the Center for American Studies at the Renmin University of China told the Global Times. He noted that the confrontation will not be as intense as when China and Japan sparred over the Diaoyu Islands, but given Japan's ambition to expand its sway in the South China Sea, Sino-Japanese relations will take a hit in the foreseeable future. This is not the first time that Japan has tried to persuade the seven nations to express "strong opposition" to China's territorial claims. The 2015 G7 communiqué in Germany said the leaders "strongly oppose the use of intimidation, coercion or force, as well as any unilateral actions that seek to change the status quo, such as large-scale land reclamation." The statement fell short of singling out China but the wording was an apparent reference to Beijing. "The G7 platform is built to strengthen cooperation, not amplify conflicts. Plus, none of the seven countries are involved in the disputes. It's inappropriate to discuss South China Sea disputes at a meeting that is meant to cement economic ties," said Geng Xin, deputy director of the Tokyo-based think tank New Japanese Institute of JCC. The Group of Seven includes Canada, France, Germany, the UK, Italy, Japan, and the US. Analysts are also concerned that the statement may cast a negative influence on the upcoming G20 summit, which will be held in Hangzhou, East China's Zhejiang Province in September. Pang Zhongying, a professor of international relations at Renmin University, said a statement on territorial disputes would undermine the unity of the G20 countries, which are made up of both industrialized nations as well as emerging economies. Analysts have also pointed out that Japan's moves are coordinated with the strategies of its key ally, the US, which is keen to consolidate ties with the Philippines and expand its military presence in the South China Sea region. The US is planning to conduct a third patrol in the disputed waters, according to Reuters, and expanded its joint military drills with the Philippines this year to include troops from Australia and observer states such as Japan. The US also gained access to five Filipino military bases near the disputed waters last month under a renewed defense pact between the two countries. "The US tends to be tough on the South China Sea issue but Europe has a milder stance. With German, French and British foreign ministers present at the meeting, Japan wants to convey a message to Europe, which may come with a nod of approval from the US," Shi noted. ^ top ^

EU says economic security linked to maritime disputes in South China Sea (SCMP)
Senior European diplomats said the European Union had a stake in the South China Sea disputes and urged all sides to respect the rule of law. Gunnar Wiegand, managing director of Asia and Pacific for the European External Action Service (EEAS), the EU's foreign affairs department, said at a forum in Beijing that the recent developments in the region were a cause of concern. He noted that half the world's trade passed through the South China Sea and that the EU's economic security was closely linked to stability in the Asia-Pacific ­region. “While not taking any position on claims, the EU is committed to a maritime order based upon the principles of international law, in particular as reflected in the United Nations Convention on the Law of the Sea [Unclos],” Wiegand said on Wednesday. His comments came as foreign ministers of the G7 countries plan to raise their concerns at a meeting in Japan next month over China's construction projects and military deployments in the South China Sea, and to voice strong opposition to the assertion of territorial and maritime rights through threats or the use of force, Kyodo reported. The G7 has four EU member states – France, Germany, Italy and Britain – plus the United States, Canada and Japan. The group declared in March 2014 that a meaningful discussion was not possible with Russia in the context of the G8. An international arbitration tribunal is expected to hand down its rulings in May or June on the Philippines' filings against China's claims. Beijing rejects the jurisdiction of the court and has not attended the hearings. Michael Reiterer, principal advisor on Asia Pacific to the EEAS, said at the forum that EU members, as Unclos signatories, wanted the procedures respected. “We have a stake in the rule of law being obeyed. This applies to the Unclos,” he said. “It also applies to the Treaty of Amity and Cooperation in Southeast Asia.” In 2012, Brussels stepped up its presence in Southeast Asia by joining the treaty, initiated by the Association of Southeast Asian Nations, and signed a Programme of Action in Brunei to implement an “enhanced partnership” with the group. Mei Zhaorong, former Chinese ambassador to Germany, said EU involvement would be counterproductive. ^ top ^

3rd lighthouse in S.China Sea for commercial purposes: FM (Global Times)
China is dedicated to providing public services in the South China Sea to ensure safety and freedom of navigation, China's foreign ministry said as the country completed a new lighthouse on Zhubi Reef, which was at the center of a China-US diplomatic spat last year after a US warship sailed within waters surrounding the reef to challenge China's territorial claims. China's Ministry of Transport on Tuesday held a completion ceremony for the Zhubi Reef lighthouse to mark the start of its operations. The lighthouse is the third of its kind in the South China Sea following lighthouses on Huayang and Chigua islands, which were completed last year. Asked about the lighthouse, foreign ministry spokesman Lu Kang said at a daily briefing in Beijing Wednesday that it would be helpful for commercial users of the waters. Rejecting a statement from some Western experts that the lighthouses were to consolidate 'de facto recognition' of China's sovereignty, Liu Feng, a Hainan-based expert on the South China Sea, told the Global Times Wednesday that the construction and territorial claims are not related. "China's territorial claims to the islands remain, with or without a lighthouse," Liu said. "The main purpose of the construction is to provide public services and ensure navigational safety. Other countries should stop looking at China through tunnel vision." Construction of the Zhubi lighthouse started in October 2015. The 55-meter-high lighthouse, with a lantern of 4.5 meters in diameter on the top and rotating lights inside, is monitored through a Beidou remote control terminal, reported the Xinhua News Agency. The lighthouse emits white light at night, with a light range of 22 nautical miles. The automatic identification system and very high frequency stations inside the lighthouse can provide efficient navigation services such as positioning reference, route guidance and navigation safety information to ships, which can improve navigation management and emergency response. In October last year, the US guided missile destroyer USS Lassen sailed within 12 nautical miles of Zhubi Reef, drawing an angry rebuke from China. China claims Zhubi Reef is an island where waters within 12 nautical miles constitute its territorial sea, according to Liu. Therefore, the US warship sailing within the waters of Zhubi was seen as a "deliberate provocation." […] ^ top ^

China asks nations for lists of terrorist suspects ahead of G20 summit in Hangzhou (SCMP)
China is asking countries taking part in this year's G20 summit in the Chinese city of Hangzhou to provide lists of possible terror groups and terrorists who might target the meeting, a state-run newspaper said on Thursday. The summit, expected to be held in early September, will gather major world leaders together like Chinese President Xi Jinping and US President Barack Obama. “We're facing a grim task in fighting terrorism and we hope participating countries will work together with Chinese policy to ensure the safety of such large-scale meetings,” Hou Le, a senior Chinese counter-terrorism official, told the China Daily. The newspaper added that China was asking police liaisons to hand over lists of groups or people who might be a security threat or target leaders at the summit. “Risk assessments for possible attacks are also welcomed,” it added. China says it faces a serious threat from groups such as the East Turkestan Islamic Movement, which operates in China's restive far western region of Xinjiang, home to the Muslim Uygur people, where hundreds have died in violence in recent years. Rights groups and many foreign experts though say China has never presented any convincing evidence to prove the organisation exists as a cohesive, well-organised group capable of the kinds of attacks China blames it for. Hou told the China Daily that the country was faced with real terrorist threats. The paper, citing the public security ministry, said some of the group's members have been trained in Syria or Afghanistan and could return to China to launch attacks. Beijing has been seeking more counterterrorism cooperation with Western countries, which the West has generally been unwilling to give, fearful of complicity in possible human rights abuses in China, especially in Xinjiang. China's new counterterrorism law, adopted last year, has caused particular unease in Western capitals as it codifies sweeping powers for the government to combat perceived threats. Rights groups and exiles say Xinjiang's violence stems more from widespread Uygur resentment at Chinese controls on their religion and culture rather than being committed by a well-organised militant group. China strongly denies abusing human rights in Xinjiang. ^ top ^

China's Belt and Road Initiative boosts poverty relief in Sri Lanka (Global Times)
In Sri Lanka, global visitors yearn for the buddhist culture of the sacred city of Kandy, which dates back to thousands of years ago, and the picturesque scenery of the old British-style town of Nuwara Eliya, or "city of light." For Chinese tourists, when shuttling between the two scenic places through mountainous areas carpeted with velvety green tea plantations and if observing carefully, they may find some signs written in Chinese at the brand-new bus stops along the C11 Road, the most convenient path between Kandy and Nuwara Eliya. The Chinese signs that read "Donated by Hunan Construction Engineering Group of China" and "This project is funded by China Development Bank" belong to the China-built C11 project designed to improve the local traffic condition and the livelihood of up to 800,000 people along the road. The project is part of Beijing's efforts to enhance regional infrastructure development under the Belt and Road Initiative proposed by China. Thanks to the renovated and widened road, the mountain-locked Kandy-Nuwara Eliya region, which produces high-quality tea, vegetables and flowers, are now able to transport these products at a cost less than half of that before the C11's opening. As a result, more and more local residents living along the road have begun to make a living by opening small shops and vegetable stalls. Among them is Lalith. Before the construction of the C11, Lalith was unable to leave home to work in relatively developed areas because his kid was too young and his wife was not in a good health condition. Without regular income then, he could not feed his family well .But things started to turn around as the C11 project started. The English-capable and hardworking Sri Lankan was employed by the Chinese contractor with a daily wage of nearly 10 U.S. dollars, no less than the average level of the whole country. After the road was put into use, Lalith bought a tri-wheeled cart with his savings from his work at the construction site and started his own vegetable business, which has so far doing well due to a surging market demand, lifting his family out of poverty. "Without the C11, my family would not have had the opportunity to strive for a well-off life," said Lalith who expressed his appreciation for China's funding and building of the project. In addition to traffic improvement, another focus of China's Belt and Road Initiative is to boost power generation as a sufficient supply of electricity holds the key to poverty relief. Since the 2011 commissioning of the Norochcholai power station, a China-built coal plant based in Puttalam, a town north of Colombo, Sri Lanka's power generation capacity has grown by 300 megawatts and its electricity price has dropped 25 percent, providing an effective solution to the country's long-standing lack of power supply as well as high electricity price. For Rajarathna, a Puttalam farmer, the benefits from his country's production capacity cooperation with China are more than tangible. With electricity from the Norochcholai Power Station, Rajarathna spend 20 dollars every month in irrigating his one-acre vegetable field, a sharp drop from the 138 dollars he spent when he relied on diesel fuel. Rajarathna told Xinhua that he earns as much as 4,800 dollars annually by planting vegetables, and his wife, with a janitor job at the power plant, makes over 120 dollars a month. The farmer said they are now leading a very comfortable life. As to maritime cooperation, the Colombo South Container Terminal, operated by China Merchants Group, is considered one of the best hubs geographically on the maritime Silk Road. Currently, the China-run terminal has users from 14 countries and is predicted to generate profits worth 1.8 billion dollars in the coming 35 years with revenue-creating ability and efficiency Sri Lanka has never seen. Sri Lanka will benefit from China's experiences in reform and opening up as well as achievements in poverty relief, Dr. Saman Kelegama, executive director of the Institute of Policy Studies, told Xinhua. Kelegama said China's friendship toward Sri Lanka has never been uninterrupted, which can be shown by the laudable changes brought to the country by the construction and completion of a series of China-aided projects. The new types of cooperation between the two sides, including those under the Belt and Road Initiative, will yield tangible results for both peoples, he added. ^ top ^

China will have to repair damaged public opinion in Myanmar: business leader (SCMP)
China will have to work to regain the goodwill of Myanmar's people, a local business leader said, after years of poor behaviour by mainland businesses soured local opinion. Chinese foreign minister Wang Yi (王毅) met with his Myanmar counterpart Aung San Suu Kyi on Tuesday, to discuss recent stalled infrastructure developments including a US$3.6 billion dam project. It was her first official meeting since being appointed Myanmar's foreign minister after the recent change of government. But Union of Myanmar Federation of Chambers of Commerce and Industry vice-president Dr Maung Maung Lay said unethical Chinese businesses and a close relationship with the previous regime had created problems. “Many unscrupulous traders dump substandard, spurious products in Myanmar and that has tarnished the image of China,” he said. “These Chinese companies have [also] cooperated with the military regime, which have been so unpopular. That creates a problem... the friend of my enemy is not my friend.” Lay said to improve their image the Chinese government had to maintain a firmer grip on their businesses to ensure any unethical or irresponsible behaviour was stopped. “The Myanmar people are friendly with anyone, any country, we don't have any prejudice or anything,” he said. “Both sides [China and Myanmar] must work together, we can't abandon our neighbour. We can choose our friends but not our neighbours.” According to a statement from the Chinese Foreign Ministry, Wang said he was confident that China would resolve business disagreements with Myanmar in a friendly manner. “Of course, there will be problems during the course of cooperation,” he was quoted as saying. “I have reached consensus with Madam Suu Kyi that all problems will be properly resolved through friendly coordination.” Among the Chinese business ventures under discussion are the Myitsone dam project, put on hold in 2011, and the Letpadaung copper mine. Appearing to address Myanmar citizens' concerns with Chinese business activities in the country, Wang said mainland companies needed to act responsibly. “We will also demand Chinese companies in Myanmar follow Myanmar's law, respect local customs, pay attention to the protection of ecology, carry out public livelihood projects and fulfil their social responsibilities,” he said. The meeting with Suu Kyi comes a week after Myanmar saw an historic change of government the first openly contested elections in 25 years in 2015. Nanyang Technological University's S. Rajaratnam School of International Studies fellow Alistair D. B. Cook said the Chinese government would be working hard to ensure relations were amicable with the new government. “This will particularly be the case if China is to play a stronger role in assisting national reconciliation, and restarting some of its stalled investments,” he said. ^ top ^

Japan and China nuclear envoys to discuss response to North Korea missile push (SCMP)
Nuclear envoys of Japan and China will meet in Tokyo on Tuesday to discuss responses to North Korea's pursuit of nuclear and missile programmes, Japan's foreign ministry said on Monday. Wu Dawei, China's special representative for Korean affairs, will meet Kimihiro Ishikane, head of the foreign ministry's Asian and Oceanian Affairs Bureau, on his first visit to Japan in his government capacity since December 2012, when Shinzo Abe became Japan's prime minister. Wu serves as the chairman of the long-stalled six-party negotiations aimed at ending North Korea's nuclear weapons ­programme. The talks, involving the two Koreas, China, Japan, Russia and the United States, have been dormant since late 2008. But China, considered more capable than any other country of exerting influence on North Korea, has been making greater calls for resuming them. Wu's visit to Japan, which ends on Friday, follows North Korea's fourth nuclear test in January and launch of a long-range rocket using banned ballistic missile technology a month later, which has led to additional sanctions against Pyongyang by the United Nations Security Council. Despite the punitive measures, North Korea has continued to fire ballistic missiles and projectiles into the sea. In his talks with South Korean President Park Geun-hye on the sidelines of a nuclear security summit in Washington last week, President Xi Jinping said all parties should fully and strictly carry out the resolution adopted by the Security Council in March to curb Pyongyang's nuclear and missile programmes, and that dialogue and consultations were the only way to settle the issue. Xi and US President Barack Obama also agreed to work together to foil Pyongyang's nuclear ambitions by “fully”, “strictly” and “vigilantly” carrying out the ­resolution. ^ top ^

Xi-Obama meeting eased tensions over South China Sea (SCMP)
President Xi Jinping's meeting with US President Barack Obama in Washington last week helped ease tensions over disputes in the South China Sea, state media yesterday quoted China's foreign minister as saying. China claims almost all of the South China Sea, where about US$5 trillion in ship-borne trade passes every year. Brunei, Malaysia, the Philippines, Vietnam and Taiwan also have claims. “The Americans have said they will not take sides, so it should not be a problem for the China-US relationship,” China Daily quoted Foreign Minister Wang Yi as saying. “We are confident about the steady development of the China-US relationship this year, and that will continue smoothly into the next [US presidential] term.” The two leaders met on Thursday on the sidelines of the Nuclear Security Summit in Washington amid heightened tension over the South China Sea and the possible US deployment of the Terminal High Altitude Area Defence system in South Korea. But Chinese analysts expressed doubts over the power of the presidential talks to resolve the tensions, especially with the US Navy reportedly planning another passage through the disputed waters early this month. The passage is expected to take US naval vessels near contested islands in what would be the third in a series of challenges that have drawn sharp rebukes from China. “The US announcement of the patrol on the second day after the bilateral talks could mean that two sides have not reached an agreement,” Renmin University international relations professor Wang Yiwei said. “China's construction work in the South China Sea has made the US worried that its military dominance in the region is fading.” Wang Yong, a professor of international studies at Peking University, said tensions might continue to rise ahead of an upcoming ruling on a territorial dispute by an international court. The Permanent Court of Arbitration at The Hague is expected to make a final decision, possibly this month or in May, on a case lodged by the Philippines against China. Wang Yong also said anti-China sentiment might have run high in the US elections but it would not have a major impact on Sino-US relations. “The Obama administration has been under pressure from the conservatives and hardliners, hence the gesture [of the patrol]. But the impact of candidates playing the 'China card' this year has not been obvious,” he said. Wang Yiwei said the existing communication mechanism between the US and China would stop tensions from escalating. Those mechanisms included the 2014 memorandum of understanding on unplanned encounters at sea and in the air. ^ top ^

China, S. Korea, Japan to hold talks on trilateral FTA in Seoul (Global Times)
China, South Korea and Japan will hold working-level talks on the trilateral free trade agreement (FTA) in Seoul this week, South Korea's trade ministry said on Monday. The 10th round of working-level negotiations for the free trade deal among the three Asian powerhouses will be held from Tuesday to Friday in Seoul, according to the Ministry of Trade, Industry and Energy. During the meeting, negotiators will focus on core issues such as modality, or basic guidelines, on how to liberalize goods trade and service industry. Also on the agenda will be 20 issues, including country of origin, customs, trade remedy, sanitary and phytosanitary (SPS) measures and technical barriers to trade (TBT). Under the principle of a comprehensive, high-level, mutually beneficial FTA, the three countries have held nine rounds of negotiations since the talks began in November 2012. During the trilateral summit in November in Seoul, leaders of the three Asian countries agreed to speed up negotiations on the three-way FTA. Combined gross domestic product of China, Japan and South Korea accounts for about 20 percent of the world and some 70 percent of Asia's total. ^ top ^

China's appointment of Syria envoy to boost involvement in Middle East and protect regional interests, say analysts (SCMP)
China's appointment of a special envoy to help mediate in the conflict in Syria is aimed at increasing the nation's diplomatic involvement in the Middle East, boosting its global image and protecting its expanding economic and security interests in the region, according to analysts. The appointment last week of Xie Xiaoyan, a career diplomat who has served as ambassador to Iran, as China's first special envoy for Syria shows Beijing's growing involvement in the Middle East, following President Xi Jinping's high-profile visit to the region in January. The appointment of a Syria envoy was above all else symbolic, demonstrating China's determination to play a role in talks to end the conflict, according to Michael Singh, managing director at the Washington Institute for Near East Policy. “Syria is arguably the most important issue in the Middle East right now, drawing in all of the key regional players as well as outside powers such as Russia, the EU and the US who all see themselves as having a vital stake in the resolution,” said Singh, a former senior director for Middle East affairs at the US National Security Council. “China cannot afford to be absent from the deliberations.” A partial ceasefire brokered by Russia and the United States in late February has largely held, with the Syrian government reaping a series of recent military gains. China, along with Russia, vetoed four resolutions at the United Nations Security Council on Syria until one proposing support for international efforts to seek a political solution to the crisis was finally approved last December. Xiao Xian, head of Middle East studies at Yunnan University, said China should get more involved in resolving the crisis especially now that the situation in Syria was becoming clearer. “In my view, China should have participated more a long time ago. If we don't do it now, it will be too late,” he said. He urged Beijing to engage more in peace talks, post-war reconstruction and discussions over the refugee crisis in keeping with its image as a “responsible great power”. “Other countries in the Middle East, such as Iran, Saudi Arabia and Turkey all wish China to exert more influence, to strike a balance from powers like the US and Russia ... but it seems like China has not met their expectations,” he said. It is not only image and prestige that China wants to bolster through more active diplomacy in Syria, according to Singh. More importantly, it is aimed at ensuring China's interests in the region are protected or advanced, he said. “China has been expanding its diplomatic involvement in the Middle East for a number of years in lockstep with the expansion of its economic and security interests there,” he said. Trade between China and the Middle East soared to USD340 billion in 2014, according to Chinese government data. The number of Chinese workers in the region has also soared and 52 per cent of China's oil imports now come from the region. “These developments have been packaged as elements of Xi Jinping's 'One Belt, One Road' initiatives, but in reality they have been in the works for some time,” said Singh. “China has largely abandoned its former standoffish approach for one which is growing more active every year.” China played a key role last year in brokering the Iran nuclear deal, aimed at curbing Tehran's nuclear programme in return for the easing of international sanctions. Robert Bianchi at the Middle East Studies Institute at Shanghai International Studies University, said increased influence in the region would strengthen China in dealing with other great powers anywhere where their spheres of influence overlap or collide. “China's leaders want as many bargaining chips as possible to trade across the vast continents and oceans where Chinese commerce and security are facing greater risks,” he said. Li Guofu, director of Middle East studies at the China Institute of International Studies, said Beijing was in a strong position to mediate in Syria. “Given that the United States, Russia and neighbouring countries have opposing stands on relevant issues, China should search for a breakthrough amid these opposing views,” he said. ^ top ^

China's President Xi Jinping vows to step up nuclear security in face of terror threat (SCMP)
President Xi Jinping has vowed to ramp up China's nuclear security to prevent the threat of terrorists getting hold of radioactive material to create weapons. Xi said in a speech at a nuclear security summit in Washington that China would strengthen its monitoring and control of nuclear materials and push for greater international cooperation to tackle the issue. “Nuclear terrorism is the common enemy of all mankind,” he said. “Nuclear security incidents will have impacts that go beyond national borders. In the age of connectivity, no country can deal with such problems alone and no country can stay immune from their impacts.” US President Barack Obama told the summit that extremists who got hold of nuclear weapons or materials would not hesitate to launch a catastrophic attack. He said about 2,000 tonnes of nuclear materials were stored around the world at civilian and military facilities, but some of it was not properly secured. “Just the smallest amount of plutonium, about the size of an apple, would kill and injure hundreds of thousands of innocent people,” he said. Experts say nuclear or radioactive materials for civilian use, such as those used for magnetic resonance imaging at hospitals or luggage scanners at airports, were likely to be the easiest targets for terrorists. These materials cannot trigger a powerful nuclear chain reaction, but could be hazardous enough to be made into a “dirty bomb” that causes human casualties and panic, according to Zhao Tong, a nuclear policy researcher at the Carnegie-Tsinghua Centre for Global Policy in Beijing. Nuclear power stations were another likely target for terrorists, Zhao said. This could take the form of a September 11-style attack on the building or a radicalised insider intentionally creating a nuclear accident, which would be very difficult to prevent, he said. Leaders from more than 50 countries attended the summit and issued a communique pledging to prevent “non-state actors” including terrorists from obtaining nuclear and other radioactive materials. Xi said in his speech that China would monitor and safeguard high-risk radioactive materials, track civilian nuclear material and organise drills with other countries on how to handle nuclear emergencies. “We will guarantee domestic and exported nuclear power plants are safe and reliable,” he said. Xi added that China was dedicated to developing nuclear energy, but doing so safely. China plans to build six to eight more nuclear power plants each year under its next five-year plan as it attempts to reduce its reliance on heavily polluting coal-fired power stations. Thirty nuclear power plants were in operation by the end of last year and another 22 are under construction, the government said in January. Tao Wenzhao, a researcher at the Chinese Academy of Social Science, said: “The number of nuclear power plants under construction in China is larger than tthe rest of the world combined.” China is also trying to export its expertise to build nuclear power stations overseas, particularly in developing countries. Foreign nuclear projects overseen by China could be more vulnerable to terrorism, said Zhao, due to a local lack of knowledge and experience in handling nuclear materials, he said. Xi told the summit that China welcomes operators from these countries to train in China. He also held separate meetings with Obama and South Korean President Park Geun-hye and discussed the North Korean nuclear weapons test crisis. ^ top ^


Domestic Policy

Xinhua hosts forum on how to strengthen China's voice (Xinhua)
Xinhua News Agency held a forum on Thursday on how to create a discourse system that will help China better communicate with the world. The country should establish a system to tell China stories more vividly and help a stronger China voice be heard, said Wang Xiaohui, deputy head of the Publicity Department of the Communist Party of China (CPC) Central Committee, when delivering a speech at the opening ceremony. Wang said the system should also aim at improving the world's understanding of China. Xinhua President Cai Mingzhao said in a keynote speech that it is crucial to establish a discourse system which carries distinct Chinese characteristics and could be understood and accepted by the international community. Cai said the new governing ideas of the CPC Central Committee should be a priority of the communication efforts and they should be introduced to the world in an accurate, complete, and vivid manner. Representatives from media organizations and universities, including the People's Daily and Peking University, attended the forum. China has become the focus of the world attention in recent years as its overall national strength increased. However, there is a gap between the real China and a China perceived by the West. To adapt to the new situation, Cheng Manli, a professor with Peking University, said the traditional notions of communication must be changed and innovative ideas should be adopted. Attendees also noted that personnel cultivation is the basis for improving China's ability to communicate more effectively with the outside world and developing think tanks. Shi Anbin, a professor of media and cultural studies with Tsinghua University, said in a bid to improve the capability in international communication, Chinese media should break the old system and employ professionals overseas. The country is also strengthening the building of top think tanks. "Such an effort will make China's decision-making processes more appropriate and orderly and chime with the trend of social development," said Hu Zhengrong, vice president of the Communication University of China. ^ top ^

China was largest market for 'Panama Papers' law firm: investigation (SCMP)
Nearly a third of the business of Mossack Fonseca, the law firm at the centre of the Panama Papers scandal, came from its offices in Hong Kong and China, reports say – making the Asian giant its biggest market. Shell companies incorporated through the Hong Kong and China offices of the Panamanian law firm accounted for 29 per cent of its global active companies, according to the International Consortium of Investigative Journalists (ICIJ), which co-ordinated a year-long investigation into a trove of 11.5 million documents. The investigation found that relatives of at least eight current or former members of China's Politburo Standing Committee, the ruling party's most powerful body, have been implicated in the use of offshore companies. Such vehicles are not illegal in themselves and can be used for legitimate business needs. But they commonly feature in corruption cases, when they can be used to secretly move ill-gotten gains abroad. Under President Xi Jinping, Beijing has launched a much-publicised anti-graft drive, but has not instituted systemic reforms such as public declarations of assets. Xi's brother-in-law and family members of two current members of the Politburo Standing Committee (PSC), Zhang Gaoli and Liu Yunshan, have offshore holdings, ICIJ reported. Relatives of past PSC members Jia Qinglin, once the fourth-ranked leader in China, Li Peng, who led the Tiananmen Square crackdown, Hu Yaobang, former vice-president Zeng Qinghong, and Tian Jiyun were named by Britain's Guardian newspaper, which took part in the investigation. The documents also named film star Jackie Chan, billionaire heiress Kelly Zong Fuli, and shopping-mall magnate Shen Guojun. Chinese media have largely avoided reporting on the leaks and social media have been scrubbed of references to them, with foreign news broadcasters such as the BBC blacked out when they report on the issue. Mossack Fonseca has offices in eight Chinese cities including Hong Kong, its website showed, more than any other country. Its locations in China include the major financial centres of Shanghai and Shenzhen, as well as the port cities of Qingdao and Dalian, and lesser-known provincial capitals such as Jinan, in Shandong province, and Hangzhou, in Zhejiang province, along with another Zhejiang city, Ningbo. In a statement, Mossack Fonseca denied any wrongdoing and said it had always complied with relevant laws and regulations. ^ top ^

Union for left-behind children holds first meeting (Global Times)
Twenty-seven government institutions and other organizations of China have partnered to form a stronger safety net for children left at home by migrant-worker parents. They identified key targets for this year including carrying out a nationwide census on rural "left-behind" children, establishing a database on foster families living in poverty as well as improving and implementing policies allowing children of migrant workers to sit exams in cities. The new network, formally established on Tuesday, comprises the ministries of civil affairs, education, public security, justice, finance, human resources and social security, and agriculture, the Supreme People's Court, Supreme People's Procuratorate, and organizations related to women, youngsters and disabled people, among others. At the network's first meeting on Wednesday, delegates also called for measures concerning poverty alleviation, education and judicial protection for left-behind children. Roles and duties of the members of the network were assigned at the conference. Civil Affairs Minister Li Liguo stressed the importance of coordination and sharing information among the institutions involved. ^ top ^

China to further deepen reform of healthcare system (Xinhua)
China will further deepen reform in healthcare this year with key factors for the reform discussed at a meeting of the central government on Wednesday. The State Council, the country's cabinet, convened a regular executive meeting Wednesday and determined that healthcare reform should benefit more people. Key sectors for healthcare reform this year were decided at the meeting, which was presided over by Premier Li Keqiang. Plans discussed included expanding the number of cities piloting urban public hospital reform from 100 to 200, implementing a tiered medical care pilot project in 70 percent of the country's prefectural-level areas, and improving the compensation system in a bid to abolish the drug price addition policy of public hospitals in new pilot cities. Other focuses included implementing a centralized procurement of drugs used by public hospitals, improving the performance-based remuneration system in grassroots health institutions, and building a national network for basic health insurance settlement so that people can reimburse their medical expenses in different places. Critical disease insurance will cover all people within the year, according to the healthcare reform plan, which noted that subsidies per capita for basic health insurance and basic public health services will be raised. The number of resident physicians receiving standardized training will be increased by 70,000, including 5,000 pediatricians, according to the meeting. ^ top ^

Ex-military leader to be prosecuted on corruption charge (China Daily)
Guo Boxiong, a former senior military leader, will be charged with corruption, China announced on Tuesday while pressing ahead with its anti-graft campaign. Investigations by military prosecutors found that Guo, who was vice-chairman of the powerful Central Military Commission before retiring in 2012, collected bribes for arranging promotions for others, Xinhua News Agency said. Guo's case is being handed over for prosecution now that the investigation is completed, Xinhua said. The military procuratorate said that the amount of bribes Guo is charged with taking was "huge", although it didn't release the amount, and it said the 74-year-old had confessed during the investigation. A commentary on the Chinese Ministry of Defense website said on Tuesday that the military must take the necessary steps to build discipline and remove internal malaise. The practice of military law and discipline should be "merciless", it said. Guo was expelled from the Communist Party of China in July. Under the Chinese Criminal Procedure Law, military prosecutors will hand over the case to the country's military court. Authorities will deal with Guo's family members and others implicated in the case without tolerance, said a statement from the military procuratorate. Guo's son, Guo Zhenggang, who was a major general, was put under investigation for corruption in February last year. Since March last year, dozens of military officials have been exposed for allegedly violating discipline and laws, as part of the country's drive in recent years to root out corruption in the military. Xu Caihou, another senior military official who served with Guo as vice-chairman of the Central Military Commission, was probed in March 2014 for allegedly taking "massive" bribes. Xu died of bladder cancer in March last year. President Xi Jinping has made it a key goal to weed out corruption in the military. A number of high-level corruption cases have since been exposed. In August, after Guo was put under investigation, Defense Minister Chang Wanquan pledged intensified efforts to run the army with "strict discipline and in line with the law". ^ top ^

Xi calls for effective self-discipline campaign, Marxist values (Xinhua)
President Xi Jinping has called for Communist Party of China (CPC) organizations at all levels to work to ensure the effectiveness of a year-long campaign to instill rules and good values in Party members. Xi made the remarks in an instruction on the newly launched education campaign, which focuses on the study of the Party Constitution and rules, as well as the remarks made by Xi, also general secretary of the CPC Central Committee. Xi noted that the campaign is "a major ideological and political task" that is crucial for the "Four Comprehensives" strategy, especially in pushing strict Party management at the grassroots level. The "Four Comprehensives" strategy refers to comprehensively completing the building of a moderately prosperous society, deepening reform, advancing the rule of law and strictly governing the CPC. While affirming the results of past campaigns in regulating Party members and officials and correcting their shortcomings, Xi noted that ideological and political work require long-term efforts. "Arranging the new study campaign is a step toward expanding intra-Party education from 'a key few' to the Party members more broadly, and a switch from centralized study to study conducted more frequently," Xi said. Xi stressed that the campaign aims to consolidate Party members' Marxist positions and ensure that the entire Party maintains a high degree of ideological and political consistency with the CPC Central Committee. ^ top ^

China limits 'Panama Papers' coverage and denounces tax haven revelations (SCMP)
China has moved to limit coverage of the massive leak of documents from a Panamanian law firm that may have exposed financial wrongdoing by some of the world's rich and powerful, by blocking some search terms and removing certain stories online. The “Panama Papers” revealed financial arrangements of politicians and public figures, including friends of Russia's President Vladimir Putin, relatives of the prime ministers of Britain, Iceland and Pakistan, and the President of the Ukraine. The law firm, Mossack Fonseca, which says it has set up more than 240,000 offshore companies for clients around the globe, has denied any wrongdoing and called itself the victim of a campaign against privacy. The International Consortium of Investigative Journalists (ICIJ), which has published some of the information from the documents said the files also revealed offshore companies linked to the families of China's President Xi Jinping and other powerful current and former Chinese leaders. While holding money in offshore companies is not illegal, journalists who received the leaked documents said they could provide evidence of wealth hidden for tax evasion, money laundering, sanctions busting, drug deals or other crimes. While the Chinese government has yet to respond publicly to the allegations – the Cabinet's news office did not immediately answer a request for comment – state media have largely avoided any reporting of the “Panama Papers”. Searches for the word “Panama” on Chinese search engines bring up stories in Chinese media on the topic, but many of the links have been disabled, or open only onto stories about allegations directed at sports stars. Searches for “Panama Papers” in Chinese bring up a warning that the results “may not accord with relevant laws and rules so cannot be shown”. China's internet regulator did not immediately respond to a request for comment. However, the Global Times, an influential tabloid published by the ruling Communist Party's official People's Daily, suggested in an editorial on Tuesday that Western media backed by Washington had used such leaks to attack political targets in non-Western countries. “The Western media has taken control of the interpretation each time there has been such a document dump, and Washington has demonstrated particular influence in it,” the paper said. “Information that is negative to the US can always be minimised, while exposure of non-Western leaders, such as Putin, can get extra spin,” it added. The editorial, in both its English and Chinese editions, made no mention of the China connections in the Panama Papers. China is in the midst of a massive crackdown on corruption overseen by Xi, but the government has repeatedly had to swat away criticism that the move is more about an internal power play than actually tackling graft. Calls to the Central Commission for Discipline Inspection, the Communist Party's graft watchdog that is leading the crackdown, went unanswered. Last week, a top party magazine lashed out at critics of the anti-corruption campaign, saying that foreign media and individuals from home and abroad were intentionally trying to discredit the effort as a political “power struggle”. ^ top ^

Senior official stresses role of CPC organizations in poverty relief (Global Times)
Senior Communist Party of China (CPC) official Liu Yunshan has stressed the importance of grassroots CPC organizations in the country's poverty relief drive. Liu, a member of the Standing Committee of the Political Bureau of the CPC Central Committee, made the remarks during his inspection tour from Wednesday to Saturday to the southwest Chinese provinces of Sichuan and Yunnan. He went to the counties of Lushan in Sichuan and Ludian in Yunnan, both affected by serious earthquakes in recent years. He visited villages, businesses, communities and medical clinics to survey the progress of post-quake reconstruction and livelihood. He called on local CPC organizations and Party members to act as leaders in the reconstruction and poverty relief drive. He also went to ethnic minority villages in the two provinces, visiting poor families and residents and listening to local officials' views on poverty relief. Noting that the battle against poverty is of great importance to building a moderately prosperous society, Liu said fighting poverty is also a political obligation for CPC cadres and requires practical and down-to-earth work. He also attended forums in the two provinces and met with local officials. He said high-quality officials are key to poverty relief and more officials should be assigned to less-developed areas to help the efforts. The performance of officials in poverty alleviation, quality of life and environmental protection should be given more weight in assessment, and those who do an outstanding job in poverty relief should be granted better promotion opportunities, Liu said. ^ top ^

China to deepen law enforcement in cultural market (China Daily)
China has issued a guideline for deepened reform of law enforcement in cultural market in a bid to safeguard the "national cultural and ideological security," Xinhua learned Monday. "Harmful cultural products and services are sometimes spreading" in cultural market, according to the guideline issued by the General Office of the Communist Party of China (CPC) Central Committee and the General Office of the State Council. The constantly emerging harmful information are undermining the cultural rights of the minors and the intellectual property rights, and causing a public outcry, it said, adding that those major problems should be addressed by capable law enforcers in cultural market. As for cultural products, social benefits must be given priority over economic gains, the guideline said, calling for further improving law enforcement. The reform aimed to build a law enforcement force in cultural market that conforms to the socialist core values and meet the needs of the modern cultural market system. The reform must stick to the leadership of the Party, spread the socialist core values, promote the rule of law and clearly define the power of different departments, it added.  ^ top ^

After brief pause, China rushes to build more nuclear power plants (SCMP)
China briefly halted approval of new nuclear power plants as it reviewed safety standards in the aftermath of the Fukushima nuclear disaster in 2011, but is now deeply embracing the energy source. The country is keen to tap cleaner power to fuel its power-hungry economy in a way that doesn't destroy the environment. The nation gets about 2 per cent of its electricity from nuclear power and aimed to raise the level to 6 per cent by 2020. The country is operating 30 plants with a capacity of 26.9GW and another 24 are under construction. They will add another 28.8GW when they come online. The nation's latest five-year plan calls for a dramatic increase non-fossil fuel energy sources, in part by accelerating development of coastal nuclear power plants by 2020 to 58GW. The head of the China Atomic Energy Authority, Xu Dazhe, was quoted recently by Xinhua as saying the country needed to speed up its nuclear power development while improving safety standards for the industry. Apart from energy concerns, China has been eager to advance its nuclear missile technology to bring it in line with other leading powers but its drive has faced resistance from the international community. China has about 240 nuclear warheads, according to a 2012 estimate by the Arms Control Association, a private non-partisan group in Washington. The United States, by contrast, has some 5,113, including tactical, strategic and non-deployed weapons. […] “A small and survivable nuclear force is enough for the purpose of security,” Li wrote. President Xi Jinping detailed China's nuclear security policies at an international conference in 2014. He said the nation would give top priority to the peaceful use of nuclear energy while managing nuclear materials and facilities by the highest standard. “China has maintained a good record of nuclear security in the past 50 years and more,” he said. Xi pledged to enhance the government's regulatory capacity, increase investment in technology and talent while strengthening nuclear security capability. Zhao Tong, a nuclear security specialist at the Carnegie-Tsinghua Centre for Global Policy, said it was inappropriate to apply a blanket legal framework developed by the West on China's nuclear security. Countries like the United States put anti-terrorism concerns at the centre of its nuclear security policy, while China preferred to address the problem through tackling its causes, Zhao said. ^ top ^



Beijing to partially ban motorbikes (Global Times)
Beijing's move indicated a nationwide trend that other cities may follow due to safety concerns, an expert said. Starting next Monday, the ban will be implemented along part of Chang'an Avenue - the city's main thoroughfare - and several streets around Tiananmen Square in the heart of Beijing, the Xinhua News Agency reported Tuesday. The Beijing Traffic Management Bureau (BTMB) said the 10 affected streets have heavy traffic, higher accident rates and often lack bicycle lanes. "The ban is just a start," an official in the BTMB's publicity department told the Global Times on Tuesday, although he denied that Beijing will consider expanding the ban's scope to include other roads. According to statistics provided by the BTMB, 113 people died and 21,423 were injured in 31,404 traffic accidents caused by electric bikes in Beijing in 2015. Such accidents accounted for 36.7 percent of all traffic accident injuries. "Other cities with complex road and traffic situations may also introduce similar bans, as safety concerns caused by those vehicles has become a pressing issue in China," Wang Limei, vice president of the China Road Transport Association, told the Global Times. Xi'an, the capital of Northwest China's Shaanxi Province, launched a similar ban campaign as early as 2006, followed by cities including Haikou in South China's Hainan Province and Wuhan in Central China's Hubei Province. In late March, a similar ban on electric bikes was implemented in Shenzhen, South China's Guangdong Province, sparking controversy and drawing many complaints, especially from food and package delivery companies, which use electric bikes to provide over 80 percent of their services. Some delivery companies in Shenzhen have complained that they cannot operate until traffic police are off duty, and the move reportedly triggered the resignation of about 1,000 couriers, who feared they would be detained or fined by their employers for failing to complete their workloads. In Beijing, where over 90 percent of restaurants that offer food delivery services online make deliveries with electric bikes, the ban has given rise to concerns about delivery services among both customers and companies, The Beijing News reported. Baidu Waimai, a food delivery online-to-offline platform, said their couriers will have to ride unmotorized bikes if electric bikes are banned. ^ top ^

President Xi plants trees, urges forestry development (China Daily)
Xi, also general secretary of the Communist Party of China (CPC) Central Committee, visited an afforestation site in Beijing's Daxing District and planted six saplings of different varieties at the site. Other top leaders, including Premier Li Keqiang as well as Zhang Dejiang, Yu Zhengsheng, Liu Yunshan, Wang Qishan and Zhang Gaoli, also attended the event. Noting that the 13th Five-Year Plan period (2016-2020) marks an important stage in building a moderately prosperous society in all respects and in China's ecological protection drive, the president stressed forestry development as a significant measure to fulfill these goals. He called on officials at all levels to take the lead in voluntary tree planting campaigns to promote new development concepts with their own practices. Also, he called for proper management of planted trees to make people's living environment greener and more beautiful. The president called for an altruistic and down-to-earth spirit for such activities, citing the Chinese proverb "people plant trees so their offspring can enjoy the shade." Situated in Xihongmen township in Beijing's southern Daxing District, the greens where the top leaders planted trees used to be a venue for logistic inventory and other low-end industries. Thanks to the strategy of coordinated development of Beijing, Tianjin and Hebei which requires the capital city to eschew its non-capital functions, the place has been reshaped into a park following economic restructuring. Xi told officials, volunteers and school children present that Mao Zedong issued the call of "greening the country" 60 years ago, and the National People's Congress began the tree planting campaign 35 years ago at the behest of Deng Xiaoping. Over the years, China's forests have continued to grow at the fastest pace in the world this century, Xi noted. The president also stressed the environmental protection drive. He added, all tasks under the ecological protection drive, not limited to tree planting, need to be carried out well with widespread public participation. China will also promote afforestation via multi-lateral cooperation mechanism, such as the Belt and Road Initiative, so as to cope with global challenges, such as climate change, and to contribute its due share to global ecological security, Xi said. ^ top ^



Police raid Shanghai 'Ponzi scheme' suspected of raising ¥30b (SCMP)
Shanghai police have raided a suspected Ponzi scheme operation thought to have raised more than 30 billion yuan (HK$35.9 billion), in the latest sign of cracks in the mainland's lending system. More than 20 people were taken into custody for further questioning, local police said. The authorities said they found clues of illegal activity including unauthorised acceptance of public deposits and fraud. Xu Qin, owner of Shanghai-based Zhongjin Capital Management, was apprehended at an airport as he attempted to flee the country. The raid came after the municipality published a new rule on Monday requiring local authorities to step up their policing of illegal fundraising. Sources said officials feared a new wave of defaults by illegally-run private lenders could undermine social stability. Zhongjin, founded in 2012 with registered capital of 10 million yuan, marketed itself as a private-equity fund group with offices in locations such as the Bund. The company, through online promotions and sponsorship deals for some blockbuster television programmes, appeared to have convinced investors of its financial strength and reputation. “The raid shows that police are doubling efforts to uncover all the illegal fundraising schemes,” said Gong Zhenhua, a partner with Shanghai Ronghe Law Firm. “Zhongjin will be just one of the illegal businesses exposed.” Local media said Zhongjin had raised about 34 billion yuan from its “business partners” while offering interest rates of up to 2 per cent a month. Mainland law-enforcement authorities are prioritising financial crimes this year. Online peer-to-peer (P2P) operators and some privately-owned asset management firms have been heavily targeted after three years of breakneck growth in the sector. P2P firms are allowed only to serve as a matchmaker for borrowers and lenders and are barred from taking the deposits to create an asset pool. But hundreds of P2P businesses have openly touted their ability to manage wealth for clients since 2013. Late last year, Ezubao, one of the mainland's biggest P2P lending platforms, which allegedly defrauded about 900,000 investors out of more than 50 billion yuan, collapsed as alarm bells rang over the shadow banking system. ^ top ^

Shanghai locals may take credit score hit if they don't visit parents (Global Times)
Shanghai residents who don't regularly visit their parents may face lawsuits or have their credit score affected under a new local regulation, media reported Thursday. Adults should fulfill their duty to give economic and spiritual support to their parents and "come back home often," according to the new regulation on protecting elderly people's rights and interests. Family members should also pay regular visits to their parents who live in nursing institutions, according to the regulation. The regulation will be implemented from May 1 onwards. Luo Peixin, a deputy director of the Shanghai government legislative affairs office, was quoted by news portal as saying that aside from influencing people through moral education, the authorities can use legal means to force people to fulfill their duties. Luo said that elderly people will be able to file a lawsuit to make their children visit them and people who fail to carry out the court-ordered visits will see their credit rating take a hit. The authorities have not confirmed how much the rating will be affected. Luo said that Jiangsu and Guangdong provinces as well as Beijing already have similar regulations, asking children to "come back home often." The Shanghai government has started conducting surveys on improving family pension liability and some governmental departments have started to develop legal networks to help elderly residents better safeguard their legal rights, reported. ^ top ^

Home sales slump in Shanghai, Shenzhen after new curbs (SCMP)
Following a series of tightening measures, residential markets in Shanghai and Shenzhen have slumped for the first time after a yearlong boom. Some 283,600 square metres of residential space was sold in Shanghai in the week from March 28 – a drop of 60 per cent from the previous week – according to Shanghai-based Uwin Real Estate Research Centre. Prices also fell, by 3.4 per cent. Labelled the toughest property cooling measure ever in China, Shanghai on March 25 announced new curbs for non-Shanghai buyers, requiring them to show proof of payment of taxes or social insurance for five consecutive years. Earlier, it was two of the preceding three years. The new rules also raised the minimum down payment for second homes from 40 per cent to 50 or 70 per cent, depending on the size of the units. Prices of new homes in Shanghai rose 25.1 per cent year on year last month. Shenzhen saw the biggest growth among 70 cities, with a rise of 57.8 per cent, according to China's National Bureau of Statistics. In Shenzhen, sales volume in both new and second-hand markets also fell last week, according to David Hong, head of research at China Real Estate Information Corp, a subsidiary of E-House (China). A residential project in Nanshan that came on the market on March 30 could sell only half the units, he said. “Before the curbs, usually 60 per cent of new projects would be sold,” said Hong. The slump followed the Shenzhen municipal government's decision to raise the minimum down payment for a segment of buyers from 30 per cent to 40 per cent. Non-Shenzhen buyers would now be required to show proof of payment of social insurance or individual income tax for three consecutive years in order to qualify for home purchases, instead of the one year stipulated earlier. From April 1, the Shenzhen government has also raised by up to half the appraisal value of properties on the basis of which sales taxes and fees on property transactions are calculated. According to Collier International, these tighter measures are expected to slow down the number of transactions in both the primary and secondary markets in the short term, with implications for prices, but that prices will continue to grow in the medium and long term. The property consultancy also says the new set of measures will check property speculation. ^ top ^



Shenzhen detains over 800 drivers in ban on illegal electric bikes (Global Times)
A total of 17,975 vehicles were seized and 874 drivers were detained in Shenzhen, South China's Guangdong Province as of March 31, only 10 days after police began a new campaign to ban unregistered or illegally piloted motorcycles and tricycles, an official with the city's traffic police department told the Global Times on Monday. About 670 people were detained for driving without licenses, and 196 were detained for "disturbing order in public places" by carrying passengers for money, Liu Ming of the information office of Shenzhen's traffic police told the Global Times. The campaign, which aims to prevent traffic accidents involving motorcycles and tricycles and to ensure fair competition in the transport industry, has made a splash online, as some delivery companies have complained they cannot operate until the traffic police are off duty. The move even triggered the resignation of about 1,000 couriers, who feared they would be detained or fined by their company for failing to complete their workloads. In Shenzhen, only 13,000 electronic bicycles are registered, or regarded as "legal," while about 3.6 million packages are expected to be delivered by electric motorbikes in the city per day, said. "The ban has hugely influenced our business," a manager surnamed Yan of YTO Express in Shenzhen, was quoted by the Chinese Business View as saying on Monday. She explained that the daily amount of parcels received by her office dropped from 80,000 to 10,000 on average. Since couriers primarily use electric tricycles, they now have to go out at 5 am to both collect and deliver parcels, which directly resulted in the sales drop, Yan said. At least 1,200 vehicles from four major delivery companies in Shenzhen were seized, while 50 couriers were detained in the campaign, news site reported Friday. Most of the drivers have been released after being detained for three to five days, Liu said. ^ top ^



Xinjiang investing heavily in infrastructure in 2016 (Global Times)
Northwest China's Xinjiang Uygur Autonomous Region has earmarked more than 160 billion yuan (24.7 billion U.S. dollars) for infrastructure construction this year, its planning body said on Thursday. A total of 163.4 billion yuan, or almost 55 percent of the region's total planned investment in 2016, will be spent on 223 major infrastructure projects, said Ahmat Manap, an official with the regional development and reform commission. Key projects include the expansion of the Urumqi airport and the Xinjiang stretch of the power transmission line linking the Junggar Basin to east China's Anhui Province. Another 80 billion yuan will be poured into industrial projects, such as natural gas production and textiles, and 66.5 billion yuan into social causes including bilingual kindergartens and poverty alleviation, according to Ahmat Manap. "Under the circumstances of the economic slowdown, these projects, totalling 440 in number, will play an important part in boosting Xinjiang's economic and social development," he said. ^ top ^



AIIB chief wants Hong Kong to raise and manage funds for lender (SCMP)
Top officials with the China-led Asian Infrastructure Investment Bank will meet within weeks to discuss the mechanism to accept new members, including Hong Kong, said the lender's president Jin Liqun yesterday. Jin also expressed a strong interest in leveraging the city's financial position to raise and manage funds for the AIIB. More than 50 countries and economies have shown an interest in the bank, of which 30 have indicated a firm intention to join, including Hong Kong, Jin said. The lender hopes to increase the number of members to 100, nearly double the current 57. “We are going to have a second board meeting at the end of this month and we will discuss the procedure for accepting new members. Hong Kong is certainly part of this group,” Jin told an audience at a forum in the city. “If things go well, in June we could have serious discussion of new members.” Jin said Taiwan would have to apply though the mainland's Ministry of Finance if the island wanted to join as stipulated by the bank's charter article of ­agreement. “Our charter clause 3.3 has stipulated non-sovereign areas and those areas not responsible for their international affairs should apply through their sovereign governments. Hong Kong should apply through the Chinese Ministry of Finance and it should be the same case for Taiwan. “Our institute must follow our charter seriously. If we don't comply with our charter, we will have no credibility,” Jin told the forum. Jin indicated last month that Hong Kong might be able to join as a sub-sovereign member by the end of this year, and that he hoped to raise funds and conduct currency trading in the city. “Hong Kong has good qualifications and it is totally reasonable to move [some] capital to be managed by Hong Kong.” AIIB has authorised capital of US$100 billion and an initial subscribed capital of US$50 billion. Jin said he expected the bank to have an asset portfolio of US$1.5 billion this year and estimated the scale to reach U$$ 4-5 billion “at a minimum” in the next five years. As a financial hub, Hong Kong could serve bond issues and handle other capital management for the AIIB, while the lender could work with banking networks in the city, Jin said. He also said Hong Kong had experienced consulting and legal firms, which could help in dispute arbitration. “We will certainly have a special seat for Hong Kong. It's already in my heart ... Please trust us, we will work hard and solve Hong Kong membership as soon as possible.” But he sidestepped questions about whether the AIIB would open an office in the city. “It does not matter if there is a headquarters in Beijing and having another office in Hong Kong; it depends on whether Hong Kong can provide services for the AIIB. Stability is also very important.” When asked if he thought Hong Kong was stable, Jin said: “I think most of the people in Hong Kong support the central government; those people who make a noise are in the minority.” He also stressed the AIIB had installed a mechanism to avoid corruption, and given its first president was Chinese, its head of ethics or human resources would come from elsewhere. “I am not saying 100 per cent there won't be corruption, but there won't be major corruption cases,” he said. Responding to a suggestion Canada may consider joining the AIIB, Ministry of Foreign Affairs spokesman Lu Kang said the bank was “open and inclusive”. ^ top ^

Occupy movement leaders reinvented? Joshua Wong to launch Hong Kong's newest political party Demosisto (SCMP)
After disbanding Scholarism, the leader of the student group, Joshua Wong is set to launch his new political party – Demosisto – on Sunday. Wong is to unveil Demosisto – derived from Greek (“demo” for “people”) and Latin (“sisto” for “to stand”), meaning “stand for democracy” – alongside Occupy movement comrades Nathan Law Kwun-chung, Oscar Lai Man-lok and Agnes Chow Ting. Details of their agenda are unclear, but Wong, the young face of Hongkongers' pursuit of democracy during the Occupy campaign in 2014, had previously called for a referendum to decide whether to change 'one country, two systems' or even to achieve self-determination in 2047. The party, whose name was made public in a press release yesterday, is also expected to field candidates in the Legislative Council elections later this year. Demosisto's formation comes as the city hotly debates the issue of Hong Kong independence. Wong yesterday crossed swords with a staunch supporter of the chief executive, who likened advocating independence to “bullying” and “robbery”. Kaizer Lau Ping-cheung, deputy director of Leung Chun-ying's election campaign team in 2012, said if Wong put forward a referendum on Hong Kong's fate beyond 2047, “he should seek the opinions of the 1.3 billion Chinese citizens first”. Wong, ex-convenor of the now-disbanded Scholarism, said he accepted the model of “one country, two systems” if the city could implement democracy and autonomy under Chinese sovereignty. 'One country, two systems' had lost its way “in the past 19 years, especially after Leung took office”, Wong said, citing Beijing's 2014 white paper stating “complete jurisdiction” over Hong Kong, and the recent case of the missing booksellers. Lau, an adviser to Our Hong Kong Foundation – a think tank backed by former local officials – said the government should beef up national education to let students better understand China and its “huge progress” on human rights. But Wong cast doubts on Beijing's sincerity in understanding young Hongkongers, as he could not even cross the border. ^ top ^

Despite growing interference from Beijing, most Hongkongers aren't seeking independence, says city's former No 2 (SCMP)
Former chief secretary Anson Chan Fang On-sang decried the mainland's increasing interference in Hong Kong's domestic affairs but maintained that most of the city's residents are not seeking independence. In a speech delivered at Tufts University on Sunday as part of a China-US symposium, Chan said that while the rights and freedoms guaranteed under “one country, two systems” are being eroded, the SAR government has ignored the problem as it is more “bent on pleasing the central authorities in Beijing than standing up for Hong Kong and its core values”. The former government No 2 said that due to disenchantment over the city's governance, localism and advocacy for independence have emerged on the city's political landscape, noting that Hong Kong Indigenous' Edward Leung Tin-kei managed to rake in a significant number of votes in the recent New Territories East by-election. Chan, however, stressed that calls for independence were not supported by the majority of residents in Hong Kong, as most accept that separation from the mainland “is neither a desirable nor realistic aspiration”. “They simply want to preserve the values, freedoms and lifestyle that make the city so special,” Chan said. During her speech, Chan also commented on the mysterious disappearance of Lee Po, which she described as a symptom of Beijing's move towards “increasingly authoritarian rule”. “This is one of the most extreme examples, since the 1997 handover, of our sovereign power feeling it can act with impunity and complete disregard for 'one country, two systems' when its national interests are deemed to be under threat,” Chan said. She lamented that local authorities were “powerless” in securing any explanation from their mainland counterparts on the circumstances of Lee's mysterious disappearance. Despite China's growing global influence, Chan stressed that Hong Kong remains an important bridge between the mainland and the rest of the world, noting that there has been a tendency to downplay this role. “Many countries have huge stakes in the city's future, both in its own right and as a gateway to business and investment in the mainland,” she said. “If Hong Kong becomes just like any other Chinese city, it will lose the ability to continue its current unique and enormously valuable contribution to China and the world.” ^ top ^



Macao's Q1 gaming revenue down 13.3 pct as anticipated: financial chief (Xinhua)
Macao's gaming sector recorded about 18 billion patacas (about 2.25 billion U. S. dollars) gross revenue in March, and its Q1 revenue is down 13.3 percent, the special administrative region's financial chief said Tuesday. Macao's Secretary for Economy and Finance Leong Vai Tac said although this March's figure drops 16.3 percent year on year, but the gaming sector's first quarter performance is within the range anticipated by the SAR government. The drop of 13.3 percent in first quarter is close to the gross revenue decrease percentage of 2016 compared with 2015, which is anticipated by government when making its 2016 budget, the financial chief added. Leong said the future development of Macao's economy and its gaming industry lies on good services to visitors, especially the services provided by non-gaming areas. Such new trends will help to attract middle class people and families to Macao for consumption. Yao Jian, deputy head of the Liaison Office of the Central People's Government in the SAR, recently said new active elements have appeared in Macao's industrial restructuring process as non-gaming revenues increased 2 percent in 2015 despite the drastic slump of gambling industry. ^ top ^



Taiwan's new passport rules will jeopardize cross-Straits ties: experts (Global Times)
Revised passport regulations in Taiwan allow its citizens to attach stickers advocating "Taiwan independence" on their passport covers, which observers said shows a growing rift on the island and will jeopardize cross-Straits relations. Taiwan's "Legislative Yuan" voted to delete a clause that stickers are prohibited from being attached to passport covers, while Taiwan's "Ministry of Foreign Affairs" said citizens with modified passports will not be asked to provide their personal information when they enter or exit Taiwan from Thursday, the Central News Agency reported on Wednesday. In 2015, Taiwanese pro-independence supporters started a campaign to redesign their passport covers with stickers that read "Republic of Taiwan" over the original "Republic of China." "Allowing citizens to attach stickers on their passport cover is an extremely childish decision, and shows that Taiwan's democracy is headed for populism," Chiu Yi, former Kuomintang (KMT) legislator, told the Global Times on Thursday. "Taiwan's administrative organs continue to be run by the KMT, yet the 'foreign ministry' has already followed the Democratic Progressive Party's (DPP) decision," Chiu said, adding that it is possible that more incidents related to "pro-Taiwan independence" may take place once the DPP takes over. Taiwan's "Bureau of Consular Affairs" under the "Ministry of Foreign Affairs" and the ministry could not be reached for comment as of press time. Allowing the pro-Taiwan independence stickers on passport covers will cast a shadow on cross-Straits relations, making it difficult to repair weak mutual trust between the two sides, said Chang Ya-chung, an international relations professor at National Taiwan University. Attaching stickers to passport covers may cause problems for Taiwan citizens who travel abroad, experts said, adding that some Taiwanese have been denied entry to some regions and countries over their altered passport covers. Taiwan's representative office in the US advised Taiwan citizens not to place "Republic of Taiwan" stickers on their passports when entering the US, warning that their entry may be refused, the China Post reported in December 2015. ^ top ^



For China's listed companies, Guangdong tops the list: shift in economic gravity towards country's coastal regions (SCMP)
Guangdong and Zhejiang are home to the most listed companies in China, according to a new report that suggests a shift in economic gravity towards China's coastal regions. The Pearl River Delta province homed 424 companies listed in China by the end of 2015, or 15 per cent of the national total. Zhejiang followed with 299 listed companies, then Jiangsu with 276, China Business News reported. Under-developed inland regions like Qinghai, Tibet, Ningxia, Guizhou and Gansu were home to the least. China's onshore stock market was created in the early 1990s, initially with the goal of helping troubled state enterprises to raise funds. But the report showed listed companies were far more likely to be non-state businesses in coastal regions, rather than inland industrial enterprises. “It's an evitable trend, and like everywhere else in the world, there's nothing to stop the relative decline of traditional heavy industry places,” said Shen Jianguang, the chief economist for Mizuho Securities Asia in Hong Kong. The report suggests that despite years of government efforts to balance regional development with preferential policies for the vast western region and the northeast rust-belt zone, both people and money are chasing bigger cities, richer places and freer economies. About two thirds of China's listed companies came from the top six provinces. Zhejiang is smaller than Shandong in terms of overall economic size and population, but the number of listed companies based in Zhejiang was almost twice that of Shandong. The newspaper attributed this to Zhejiang's robust non-state business segment. Zhejiang's proximity to Shanghai, where the main stock exchange is located, may also be a factor. Within Guangdong, there were far more listed companies in Shenzhen than in Guangzhou, the provincial capital city. Beijing, an ideal base for China's state companies, had 265 listed companies, while Shanghai had 224. Despite a spectacular stock rout last year, the central and local governments hope China's stock market can assume a bigger role as a financing channel for the country's companies to alleviate their reliance on debt for development. ^ top ^

Li: Tax reform to boost vitality of real economy (China Daily)
Premier Li Keqiang's message to the country's tax and financial authorities is crystal clear: The ongoing landmark tax reform must reduce burdens on all industries. One month before the May 1 deadline of a sweeping reform that seeks to replace China's decadeslong business tax with a value-added tax, Li visited the State Administration of Taxation and the Ministry of Finance on Friday, making sure tax-reduction measures are in place to benefit numerous enterprises. Beginning on May 1, the country's business-tax-to-VAT pilot program, which began four years ago, will expand to the remaining four sectors — property, construction, finance and consumer services — which involve at least 10 million companies. Together they contribute 80 percent of China's total business tax revenue. An 11 percent VAT will be levied on construction and real estate companies, while a 6 percent rate will be imposed on finance and consumer service sectors. In addition, VAT deductions will cover all of enterprises' new real property, the State Administration of Taxation and the Ministry of Finance said last month. "The business-tax-to-VAT reform is key to ensuring the effectiveness of the proactive fiscal policy, and to pressing ahead the structural, especially supply-side, reform for this year," Li said. "If this is well done, the real economy will be more vital." The premier said China had augmented the government deficit this year, and the increase — 560 billion yuan ($86.45 billion) more than last year, to 2.18 trillion yuan — is meant primarily to cover tax reductions for enterprises following the tax reform. The reform measures will alleviate the tax burden on enterprises by over 500 billion yuan, Li said. The reform will bolster the development of the service sector, which contributed more than half of the country's gross domestic product last year. The country has imposed a value-added tax on tangible goods, with services being subjected to a business tax imposed on a company's sales, including costs, thus resulting in double taxation. Unlike a business tax, a VAT avoids double taxation by taxing only the difference between a commodity's price before taxes and its cost of production. By eliminating repeated taxation, the reform will unify the country's taxation system and help create a fair market environment, Li said. Zhu Qing, a finance professor at Renmin University of China in Beijing, said expanding VAT reform will help cut the price of goods and services and ultimately benefit consumers. Hu Yijian, a tax professor at Shanghai University of Finance and Economics, said China's ongoing taxation reform may help blaze a trail in terms of taxing the finance sector. Most countries exempt VAT on financial products, but China's financial services will be subjected to VAT under new reform measures. "Therefore, China may discover ways that will be useful to other countries in this endeavor," Hu said. ^ top ^

Credit Suisse banks on Asia's long-term growth (SCMP)
One of the world's largest private banks has sent bullish signals on Asia, realigning funds to the region as its demographics and long-term growth trajectory are seen as outweighing short-term turbulence. “If you're a wealth manager, you want to be where the wealth is being created, and wealth is being created on a huge scale in emerging markets,” Tidjane Thian, group chief executive of Credit Suisse, said in a media briefing at the 19th Annual Asian Investment Conference on Tuesday. Thian said the Zurich-based bank had shifted some US$58 billion in capital to high-growth markets, including in Asia, since the middle of last year, and that strategic re-alignment had produced the bank's best first quarter in 10 years in terms of net new asset flows. “The return on capital is above 20 per cent most of the time,” Thian said. “We are basically reallocating capital from activities that generate 8 or 9 per cent.” Admitting the bank was “underweight” on China, where it currently has asset management and brokerage joint ventures, he said Credit Suisse plans to increase its cross-border presence to tap into a rising tide of entrepreneur-driven growth that will eventually need to move offshore. Thian also said concerns over slowing economic growth had been overstated and the commodities cycle would turn positive in the longer term. “We've never believed in a hard landing in China. We believe things are going to be reasonable,” he said. In the wake of last week's “Panama Papers” leak, Credit Suisse claims to hold a firmly principled stance on the concealment of assets in offshore tax havens, refusing to set up multi-jurisdictional structures unless assets are held in those jurisdictions and the ultimate beneficiaries are named. “We only encourage the use of structures when they have a legitimate economic purpose,” Thian said. “We do not condone structures for tax avoidance or any kind of non-transparent activity at all.” In 2014, Credit Suisse pleaded guilty to conspiracy to aid and assist US taxpayers in filing false income tax returns and other documents with the country's Internal Revenue Service and agreed to pay a total of US$2.6 billion in fines. As part of the plea agreement, Credit Suisse admitted it had operated an illegal cross-border banking business for several decades that had knowingly and willfully aided and assisted thousands of US clients to open and maintain undeclared accounts and conceal offshore assets. Credit Suisse rated second, behind fellow Swiss bank UBS, in Euromoney's private bank rankings for 2016, an assessment which considers factors including assets under management, net new assets and net income. ^ top ^

Credit Suisse, HSBC dismiss claims of tax avoidance contained in 'Panama Papers' (Global Times)
Credit Suisse and HSBC, two of the world's largest wealth managers, dismissed on Tuesday suggestions they were actively using offshore structures to help clients cheat on their taxes. Their comments came a day after a leak of four decades of documents from a Panamanian law firm that specializes in setting up offshore companies showed widespread use of those instruments by global banks on behalf of their clients and triggered government investigations across the world. The so-called Panama Papers, revealed through an investigation by the International Consortium of Investigative Journalists (ICIJ), exposed financial arrangements of politicians and public figures. Credit Suisse CEO Tidjane Thiam, who is aggressively targeting Asia's wealthiest for growth, said his bank was only after lawful assets. "We as a company, as a bank only encourage the use of structures when there is a legitimate economic purpose," Thiam, who took the helm at Switzerland's second-largest bank in 2015, told a media briefing. Separately, HSBC said the documents predated a thorough reform of its business model. "The allegations are historical, in some cases dating back 20 years, predating our significant, well-publicized reforms implemented over the last few years," said Gareth Hewett, a Hong Kong-based spokesman for HSBC. HSBC and Credit Suisse were named among the banks that helped set up complex structures that make it hard for tax collectors and investigators to track the flow of money from one place to another, according to ICIJ, which based its reports on the leaked documents from the Panamanian law firm, Mossack Fonseca. More than 500 banks, their subsidiaries and branches registered nearly 15,600 shell companies with Mossack Fonseca, according to ICIJ's analysis of the records. The vast majority of them were created since the 1990s, the ICIJ said on its website. Thiam, in Hong Kong to attend Credit Suisse's annual Asian Investment Conference, acknowledged the Swiss wealth manager does use offshore financial structures, but only for very wealthy customers with assets in multiple jurisdictions, and it did not support their use for tax avoidance or allow them without knowing the identities of all those concerned. "We do not condone structures for tax avoidance," he said. "Whenever there is a structure with a third-party beneficiary we insist to know the identity of that beneficiary." Credit Suisse agreed in May 2014 to pay a $2.5 billion fine in the US for helping rich Americans evade taxes. Several Swiss-based wealth managers, including cross town rival UBS Group AG, also had to pay large fines in the US for the same reason. HSBC, which also had wealth management operations in Switzerland, agreed in 2012 to pay $1.92 billion in US fines, mainly for allowing itself to be used to launder drug money flowing out of Mexico. The tax dispute with the US undermined traditional Swiss banking privacy laws and resulted in a radical overhaul of Swiss private banking, a tightening of global tax compliance standards as well as massive outflows from Swiss bank accounts. ^ top ^



'North Korea has become an increasing threat to China' (SCMP)
North Korea has become an increasing threat to China, according to an online commentary by the state-run People's Daily overseas edition, which compared the Korean peninsula's instability with Syria's political turmoil. An online opinion piece by the Daily yesterday said it was time for North Korea to rethink its nuclear weapon strategy as it might eventually jeopardise Pyong­yang's stability. The piece was later deleted. It also said ties between both countries had worsened, especially since China's Ministry of Commerce rolled out sanctions supporting the United Nation's call to stop imports of coal, iron ore, gold, titanium and rare earths, and exports of a range of products, including jet fuel, to North Korea. These moves are likely to have an impact on Pyongyang within six months to a year. The UN sanctions aim to starve North Korea of funding for its nuclear and ballistic missile programmes after Pyongyang conducted a fourth nuclear test in January and launched a long-range rocket in February. The opinion piece also cited recent comments by a North Korea think tank, which referred to China as “a vanity-driven nation bowing down to the US” at the cost of losing a precious friendship forged in blood. The commentary said Pyongyang lacked the capability and determination to launch a war, while domestically it was using anti-US sentiment to unite its people. “What seems to be the most dangerous and critical timing is often the least likely [time] for a war to break out,” the article said. It criticised North Korea for failing to trust China and Russia to ensure its security and for instead placing its faith on security through nuclear weapons. It also compared the Korean peninsula's instability with Syria's political unrest. “Syria's turmoil came about as the result of a population of only 20 million or so people,” it said. “Just imagine what it would be like for the Korean peninsula with [about] 80 million? “With inadequate economic, military, technological and management capability, should there be any nuclear leaks, like those that occurred in Japan [at Fukushima] ... what would happen to northeastern China's security?” It warned that developing nuclear weapons would trigger a wave of international condemnation of the North Korean regime, not recognition. Cui Zhiying, a Korean affairs expert at Shanghai's Tongji University, said bilateral ties between China and North Korea would not deteriorate completely. “North Korea still relies heavily on China via normal economic development despite UN sanctions and China will continue to uphold good neighbourly relations with North Korea,” Cui said. ^ top ^

Beijing restricts trade with Pyongyang (China Daily)
Beijing has banned imports of iron ore from Pyongyang as well as exports of jet fuel and other oil products used to make rocket fuel, outlining China's restriction on trade with the country on Tuesday. The Ministry of Commerce published a list on its website, saying it also would ban imports of gold and rare-earth elements from the Democratic People's Republic of Korea in line with new UN sanctions. The majority of the DPRK's exports to China are minerals, and its exports to China account for about 90 percent of the country's total export volume, according to Lyu Chao, a researcher at the Liaoning Academy of Social Sciences. However, China exempted imports of coal intended for "the people's well-being" and not connected to nuclear or missile programs. Export bans on jet and rocket fuel included exceptions for "basic humanitarian needs", including civilian passenger planes flying outside the DPRK. Other restricted minerals include vanadium and titanium, both used in steel alloys. The UN Security Council unanimously passed a resolution in early March expanding UN sanctions following the DPRK's nuclear test on Jan 6 and subsequent rocket launch. China's embargo statement, an implementation of the harshest sanction the international community has adopted against the DPRK, shows that Beijing is strictly honoring the resolution of the UN Security Council, said Shi Yongming, a researcher of the China Institute of International Studies. However, the international community must seek a way for peaceful resolution of the Korean Peninsula nuclear issue, Shi said. The way to truly resolve the issue is through political dialogue, he said. "The sanctions are intended to urge the DPRK to come back to the negotiating table. The sanctions themselves cannot be deemed as a purpose," he said, adding that without political dialogue, the sanctions "will surely fail". Wang Junsheng, a researcher of the National Institute of International Strategy of the Chinese Academy of Social Sciences, said it is not the first time China has issued such a statement in implementing UN sanctions against Pyongyang. In 2013, several governmental departments, including the Ministry of Commerce and the Ministry of Transport, issued notices to implement a UN Security Council resolution in response to a DPRK nuclear test in February that year. Wang said this year's embargo list, in which the exceptions are listed, shows that China is fully implementing UN Security Council Resolution 2270 while considering the DPRK's humanitarian concerns. ^ top ^

DPRK denounces Security Council for ignoring call for discussing US-S.Korea war games (Global Times)
The Democratic People's Republic of Korea (DPRK) on Saturday denounced the UN Security Council for dismissing its call for convening a meeting to discuss ongoing US-S.Korea joint military exercises. The UN Security Council is "turning a blind eye to US nuclear threats to the DPRK," the official KCNA news agency reported. The DPRK presented a letter to the Security Council late March, calling for holding an urgent meeting on the U.S.-S.Korea annual joint war games code-named "Key Resolve" and "Foal Eagle," which, a spokesperson for the DPRK Foreign Ministry said Saturday, was ignored by the Security Council. Pyongyang has said that the military exercises, with their large scale and aggressive nature, constitute a grave threat to the DPRK, disturb international peace and stability, and violate respect for state sovereignty. The spokesperson also said that the DPRK will further strengthen its self-defensive deterrent "capable of frustrating U.S. nuclear threat, blackmail and provocation." On March 7, South Korea and the United States began their joint annual war games of "Key Resolve" and "Foal Eagle." The "Key Resolve" exercise ended last month, but the "Foal Eagle" field training exercise is scheduled to last till April 30. Pyongyang has repeatedly denounced the U.S.-South Korea military exercises as a dress rehearsal for northward invasion. ^ top ^



Mongolia chairs general debate of ASEM Youth Week (Montsame)
ASEM (Asia-Europe Meeting) Youth Week (Model ASEM Hanoi 2016) took place this March 31 to April 7 in Hanoi of Vietnam. Themed “Stronger Actions to Address Zero Hunger Challenge”, the action brought together 104 youths and students from 30 countries. They shared views on effective measures for reducing poverty rate and famine in many countries. To unite their voice on combating these problems, they met several times on political, social-economic and cultural issues, and worked out a final document. It was given to Chang Ngoc An, a senior official at the ASEM and director of the Foreign Ministry Department of Vietnam on Economic Cooperation. Mongolia was represented by a student from the Mongolian University of Science and Technology (MUST) G.Javzmaa, who received a certification on chairing the general debate of the event. The action continued for three days in a view of that Mongolia is the host of the forthcoming ASEM Summit. The Ambassador of Mongolia to Vietnam Mr D.Enkhbat received G.Javzmaa and wished her success. Model ASEM is a simulation of the Asia-Europe Meeting (ASEM) Summit to generate interest and increase awareness of the ASEM process among university students and young academics. It takes place in the same month as the ASEM Summit and it is a 3-day academic conference and simulation exercise, with the latter being based on the Summit's procedures, programme and agenda. Youth participants from 51 Asian and European countries form delegations. Each delegation comprises of 3 students from different nationalities, including one head of delegation. This year's event was co-organized by the Foreign Ministry of Vietnam, the Union of Communist Youths of Ho Chi Min city, the Asia-Europe Foundation (ASEF), the British Council and the ASEF University Alumni Network (ASEFUAN) with a financing from the European Union (EU). A student from France has been selected the top panelist, and this student has been awarded a right to take part in the 7th session of ASEM Youths to be held in July in Ulaanbaatar. All expenses will be covered by Vietnam. ^ top ^

Premier concludes his visit to Hong Kong (Montsame)
The Prime Minister of Mongolia Ch.Saikhanbileg Friday gave an interview, concluding his visit to Hong Kong, a Special Administration Region of China, and a participation in the 19th Annual Asian Investment Conference (AAIC). Mr Saikhanbileg took part in the 19th AAIC as a general panelist, which took part April 5-8 in Hong Kong with a participation of some 600 high-level delegates, to give details about present situation of economy, financial and fiscal conditions, investments and business environment. Within the AAIC, the PM held meetings with some officials such as Mr Jin Liqun, the first president of the Asian Infrastructure Investment Bank (AIIB), to share views on cooperation issues. The AIIB expressed a readiness to collaborate in the biggest projects on infrastructure in Mongolia. Furthermore, the sides concurred to co-organize an exhibition in Hong Kong to advertise Mongolia-made products and services. "One of the vital actions of the Mongolian government is to let people of Mongolia become owner of wealth from mineral resources and to create a fund of wealth by transmitting the 'Erdenes MGL' LLC into a Singaporean Temasek model. So we met with some investors who can collaborate with Mongolia in this work. The Nobel Fund and the Canada's Pension Fund have an interest in the issue. They proposed to cooperate with our government, in the first turn, in setting up a business-focused board independent from the government. To express my opinion, I gave interviews to CNN Asia, Bloomberg and Credit Suisse TV channels,” Saikhanbileg said. He also said he had exchanged views with Mr Leung Chun-ying, the Chief Executive of Hong Kong, on attracting investors and businessmen to Mongolia for boosting innovation and technological spheres in Mongolia. The Hong Kong's side touched upon an issue of double-tax, saying it is possible to hold negotiations on it if investments from Hong Kong increase to Mongolia. The Premier emphasized that a purpose of his visit has been fulfilled successfully. He said investors are still interested in Mongolia, and that Mongolia managed to deliver its message that it still friendly to foreign investors. ^ top ^

Premier gives report at Annual Asian Investment Conference (Montsame)
The Prime Minister of Mongolia Ch.Saikhan underlined that Mongolia came back to business, in his report on Thursday at the 11th Annual Asian Investment Conference running in Hong Kong, a Special Administrative Region of the People's Republic of China (PRC). Although Mongolian economy experienced difficulties in 2015, it has brought some achievements thanks to realizing the biggest projects on mining and infrastructure, he said. Then he talked about a present situation in the Mongolian economy, ongoing actions for attracting foreign investments, and political stable conditions in Mongolia. The Premier also said Mongolia will host the 11th ASEM Summit this July, which is expected to gather state leaders of 53 countries, and hoped Mongolia will immensely contribute to the ties between Asia and Europe by organizing this grand event. Throughout history, Mongolia was a bridge between Asia and Europe, and still connects these continents by railways and airways. "I am very confident that the Asia-Europe cooperation will strengthen more as a result of the ASEM Summit". After the report, Mr Saikhanbileg met Board members of the Credit Suisse bank. This meeting was witnessed by N.Zoljargal, a president of the Bank of Mongolia (BoM); D.Gankhuyag, the State Secretary of the Ministry of Foreign Affairs; Kh.Gantsogt, the State Secretary of the Ministry of Finance; B.Otgonjargal, the Consul-General of Mongolia to Hong Kong; M.Monkhbat, director of the Development Bank of Mongolia (DBM); B.Byambasaikhan, an executive director of the “Erdenes MGL” LLC; Saurabh Banglani, a director of the Financial Group of the Credit Suisse; Ali Alam, a deputy director of the Credit Suisse; and others. Having started a cooperation with Mongolia in 2014, the Credit Suisse has worked as the first coordinator for a join credit programme with USD 300 million. This money has been financing big projects and programs on import substitution industrialization, the Premier noted. He underlined that the government of Mongolia and the Credit Suisse managed to raise USD 750 million by issuing bonds and a joint credit in a short time. Following the meeting, Mr Saikhanbileg gave an interview to the Bloomberg TV channel. ^ top ^

Materials for renewable energy facilities to be freed from import tax (Montsame)
The cabinet meeting on Monday approved of a list of equipment, facilities and accessories, used in renewable energy production and scientific works, that will be exempted from customs tax and VAT. As of present, the whole capability of all energy providers in Mongolia is estimated at 967 MWatt, and only its four percent generated by renewable energy sources. The Regulatory Committee of Energy (RCE) has given permissions to five projects on wind farm and six projects on solar energy. In near future, a capasity of the renewable energy sources such as solar, wind and hydro energy is expected to increase, and a size of investments to this energy industry will reach USD one billion. It is considered that Mongolia needs to support productions of solar energy and to exempt the necessary materials for renewable energy productions from taxes.  ^ top ^


Mrs. Laura Scaperrotta
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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