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
  11-15.7.2016, No. 630  
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Foreign Policy

Beijing braces for South China Sea challenge at Asia-Europe Meeting (SCMP)
South China Sea disputes are expected to feature at the Asia-Europe Meeting, posing a diplomatic challenge for Beijing in the aftermath of an international tribunal ruling. Premier Li Keqiang will attend the two-day gathering of about 50 nations, known as Asem, which gets under way on Friday in Ulan Bator, Mongolia. It will be the first major international gathering since the Permanent Court of Arbitration in The Hague sided with the Philippines on Tuesday, dealing a major blow to Beijing's territorial claims in the South China Sea. Philippine Foreign Secretary Perfecto Yasay said he would discuss “within the context of Asem's agenda the Philippines' peaceful and rules-based approach on the South China Sea and the need for parties to respect the recent decision” of the tribunal. Shinzo Abe, the prime minister of Japan, which does not have claims over the disputed waters, is also expected to call for the tribunal's decision to be respected. “I'll underscore the importance of the rule of law and peaceful resolution” of the issue,” Abe said. Beijing has resisted attempts to resolve the disputes in multilateral platforms, and the foreign ministry has said Asem is not a channel for discussing the issues. Analysts said Beijing was ready to respond if the disputes were raised but would find it hard to sweep the issues under the carpet. “Much to Beijing's displeasure the South China Sea issue will find its way into the region's major discussions and summits,” Tang Siew Mun, head of the Asean Studies Centre at the ISEAS-Yusof Ishak Institute in Singapore, said. “Refusing to have a meaningful discussion on the issue will only solidify the growing image of China's intransigence and high-handed diplomacy.” In talks with Vietnamese Prime Minister Nguyen Xuan Phuc yesterday, Li urged Hanoi to value bilateral ties and safeguard peace in the South China Sea, Xinhua reported. Meanwhile, Philippine President Rodrigo Duterte said he would like to send ex-leader Fidel Ramos to China for talks. Ramos is known to favour close ties with China but hinted he might not accept the offer, citing his age and other commitments. Beijing reacted angrily to the tribunal's ruling, saying it would not recognise the decision and stressing that the disputes should be resolved through bilateral talks. The tribunal concluded that China had violated the Philippines' sovereign rights within its exclusive economic zone, and there was no legal basis to China's claimed historic rights to resources within a “nine-dash” line. Oh Ei Sun, a senior fellow with the S. Rajaratnam School of International Studies in Singapore, said there might be heated debate over the South China Sea during Asem but a united stand against Beijing was unlikely. “There will be nations taking advantage of the summit to press China, but China will mobilise resources to prevent it from flaring up,” he said, referring to Beijing allies such as Cambodia, Laos and Russia. A Southeast Asian diplomat said the Association of Southeast Asian Nations would not issue a statement on the ruling as the 10 nations could not find common ground, with China believed to have leaned on Cambodia and Laos to prevent a statement. Xu Liping, a Southeast Asian affairs expert at the Chinese Academy of Social Sciences, said Japan would not have “enough strength” to raise the issue without the US. However, Zhang Mingliang, a Southeast Asian affairs expert at Jinan University, said European nations had similar position as the US over the disputes. ^ top ^

Could Chinese anger over US missile deployment bring down South Korea's tourism industry? (SCMP)
A potential backlash from China against the deployment of a missile defence system on the Korean peninsula has South Korea's tourism and leisure industries concerned, as they increasingly rely on Chinese tourists to drive sales. South Korea and the US plan to deploy the Terminal High-Altitude Area Defence, or THAAD, system in an area about 220km southeast of Seoul, to supposedly protect the country from North Korea. The decision drew a stern rebuke from China's foreign ministry, which said the system's powerful radars threaten its national security and warned it would take “necessary measures to safeguard” its interests in the region. The warning sent chills through the country's tourism and leisure industries, which heavily depend on Chinese visitors for sales, and would be hardest hit if China were to restrict or hamper travel to South Korea. In 2013, South Korean President Park Geun-hye said tourism was a new growth industry for the country and Seoul began easing visa restrictions for Chinese citizens, particularly those from Beijing and Shanghai, to boost the number of tourists from mainland China. The following year, the South Korean government approved the construction of its first foreign-owned casino, as the country tries to emulate Macau and Singapore in attracting more mainland Chinese gamblers. Seoul says its aim is to draw 10 million visitors a year from mainland China by 2020 – more than double the 4.3 million figure for 2013. But with the decision to accept THAAD missile systems on South Korean soil, Park could be shooting down her own grand plan, according to the duty free industry at least. Hotel Lotte, the world's third largest operator of duty free shops and the biggest in South Korea, said visitors from China accounted for 70 per cent of its duty free sales in the first six months of the year. That's up from 62 per cent in 2015 and 59 per cent in 2014. Samsung Group's Hotel Shilla, the country's second largest duty free operator, said about 65 per cent of its sales are to Chinese tourists. While not as reliant on visitors from China, several major hotels in Seoul said as much as a quarter of their occupants are Chinese tourists. “It's a huge risk factor for us if China retaliates because of the THAAD deployment,” said a duty free industry official, who did not want his name used since he was not authorised to speak on the matter. In a report on the leisure industry, Samsung Securities estimated the 2017 operating profits of Hotel Shilla, Paradise and Grand Korea Leisure could fall 2.6 per cent, 2.3 per cent, and 0.8 per cent, respectively, if the number of Chinese visitors were to drop by 1 percentage point. Several economists said it was too early to say how the country's overall economy would be affected since China has not taken any retaliatory action. “The entire economy can go bad but it's also possible that only certain industries or companies will be affected,” said Cho Seong-hoon, an economics professor at Yonsei University. Meanwhile, north of the border, Pyongyang has decided to start allowing Chinese tourists on half-day tours to visit without a passport. The passport-free visits, which began on Saturday, allow Chinese tourists to travel from the border city of Dandong to the North Korean city of Sinuju, within a “designated zone” of 30,000 square metres, Xinhua news agency reported on Monday. The tourists must travel on a particular tourism package costing 350 yuan (US$52). The manager of the Chinese tour company arranging the trips said the zone would grow to 130,000 square metres in the future to accommodate more tourists. About 10,000 Chinese tourists to North Korea from Dandong every day during peak times, Xinhua said. ^ top ^

Rocks, reefs and the ruling: the Hague tribunal's key findings in the South China Sea case (SCMP)
The Permanent Court of Arbitration covered a range of claims brought by the Philippines against China's claims in the South China Sea. Here are the key rulings. The “nine-dash line” rejected The court said Beijing had no legal basis to claim historic rights to resources within the line. It said such rights must not exceed what's permitted by the UN Convention on the Law of the Sea (Unclos). There was no evidence China had historically controlled the waters or its resources exclusively. Although the court maintained it had jurisdiction to consider historic rights and maritime entitlements, it said the matters submitted did not concern sovereignty. No islands in the Spratlys All features that remain above water at high tide in the Spratlys were given the legal status of “rocks”, including Taiping, which is administered by Taiwan. In their natural condition, none could sustain either a stable community of people or economic activity and all were dependent on outside resources. Under Unclos, rocks do not generate extended maritime zones, nor do they generate such zones collectively as a unit. As result, none of the islands enjoys an exclusive economic zone (EEZ), and the surrounding countries – the Philippines, Malaysia, Brunei and Vietnam – could each draw EEZ lines from their own major islands' baseline or coasts and claim the respective rights. But China did not have an EEZ in this region, the court found. Construction of artificial islands violated EEZ The court found these artificial islands violated the Philippines' sovereign rights in its EEZ. Mischief Reef, the largest landmass in the area at more than 5.5 sq km, was deemed a low-tide elevation and part of the Philippines' EEZ. China had built installations and artificial islands at Mischief Reef without the authorisation of Manila. The tribunal also said that China's land reclamation and construction activities had aggravated the dispute, and destroyed evidence of the natural condition of the features that formed part of the case. China had interfered in Scarborough Shoal Without making a judgment about ownership of the shoal, which has been under Chinese control since May 2012, the court said the shoal did not confer an EEZ, and China had unlawfully obstructed Philippine fishermen from accessing the shoal, which violated the traditional fishing rights of the Philippines. The tribunal ruled Chinese law enforcement vessels created a serious collision risk when they tried to stop Philippine ships from approaching the shoal. But the court found it had no jurisdiction over the military stand-off around a Philippine warship grounded at the Second Thomas Shoal. Reclamation had harmed the environment The tribunal ruled that all seven sites had caused severe harm to coral reefs and the habitat of depleted, threatened or endangered species. Chinese authorities were aware Chinese fishermen were harvesting endangered sea turtles, coral and giant clams in a way that damaged the environment. Beijing has failed in its duty to protect and the marine environment. Chinese-run reefs and Vietnam-controlled islands It avoided directly involving Vietnam in the case by deeming two reefs – Gaven and McKennan (Hughes), which China controls – as high-tide features. As a result, they should not be used to determine the territorial baselines of nearby Namyit and Sin Cowe, which are controlled by Vietnam. ^ top ^

Full text of statement by NPC Foreign Affairs Committee on award of South China Sea arbitration initiated by Philippines (Xinhua)
Following is the full text of a statement by the Foreign Affairs Committee of China's top legislature, National People's Congress, issued on Thursday, on the award of the arbitral tribunal in the South China Sea arbitration established at the unilateral request of the Philippines. Statement by the Foreign Affairs Committee of China's National People's Congress on the Award of the Arbitral Tribunal in the South China Sea Arbitration Established at the Unilateral Request of the Republic of the Philippines On the award of 12 July 2016 of the Arbitral Tribunal in the South China Sea Arbitration established at the unilateral request of the Republic of the Philippines, the Foreign Affairs Committee of China's National People's Congress solemnly states as follows: 1. The Statement of the Ministry of Foreign Affairs of the People's Republic of China on the Award of 12 July 2016 of the Arbitral Tribunal in the South China Sea Arbitration Established at the Request of the Republic of the Philippines and the Statement of the Government of the People's Republic of China on China's Territorial Sovereignty and Maritime Rights and Interests in the South China Sea have already stated China's position that the relevant award has no binding force on China. The Foreign Affairs Committee of China's National People's Congress firmly supports this position. 2. China has sovereignty over the South China Sea Islands, consisting of the Dongsha Islands, the Xisha Islands, the Zhongsha Islands and the Nansha Islands. In the South China Sea, China has internal waters, territorial sea, contiguous zone, exclusive economic zone and continental shelf, based on the South China Sea Islands. China has historic rights in the South China Sea. No country, organization or institution is entitled to deny China's territorial sovereignty and maritime rights and interests in the South China Sea. 3. The Philippines' unilateral initiation of arbitration breaches the agreement between China and the Philippines to settle the relevant disputes through negotiation, violates the Declaration on the Conduct of Parties in the South China Sea, goes against the provisions of the United Nations Convention on the Law of the Sea (UNCLOS), abuses the arbitration procedures under UNCLOS, severely infringes on China's right as a sovereign state and a State Party to UNCLOS to seek means and procedures of dispute settlement of its own choice, and seriously undermines the integrity and authority of UNCLOS. The Arbitral Tribunal in the South China Sea Arbitration established at the unilateral request of the Republic of the Philippines has no jurisdiction over the relevant matters. Disregarding the history of and basic facts about the South China Sea, the Arbitral Tribunal misinterpreted and abused the power given by UNCLOS, and arbitrarily expanded and exceeded its jurisdiction by hearing the merits of the case. Such acts violate the general legal principles of international law and arbitration including UNCLOS. The award of the Arbitral Tribunal is thus invalid and China does not recognize the award. ^ top ^

South China Sea arbitration ruling spurs new wave of patriotism (Global Times)
The award of an arbitral tribunal over territorial claims in the South China Sea has triggered a new wave of patriotism among Chinese, with many expressing on social media their wish to defend national interests. Thousands of Chinese people posted a map of China with the red nine-dash line and a slogan saying that "China will not lose a single 'dot' of its land" on Sina Weibo and WeChat. The South China Sea topic on Sina Weibo has received more than 3.6 billion views and 5.86 million comments as of press time. The arbitration tribunal in The Hague Tuesday ruled that there was no legal basis for China to claim historical rights to resources within the sea areas falling within the nine-dash line. The online activity has expanded to overseas social media with many Chinese celebrities posting Chinese maps or comments in support of China's stance on their Twitter, Facebook and Instagram accounts. An online campaign from netizens who post on patriotic online forum Di Ba started posting supportive comments under Chinese celebrities, including movie star Li Bingbing, and Lu Han, 25-year-old former member of mega boy band EXO, after their posts had been flooded by critical comments from Vietnam and the Philippines. "These stars are as patriotic as any of us, even though we may not be their fans, we can't let others bully them for their patriotism," read the post from the official account of "Di Ba crusade to FB." "It is understandable to see an increase in patriotism among Chinese since the arbitration on the South China Sea harms our national interests and many choose to express their dissatisfaction on social media," Hu Xingdou, a professor at the Beijing Institute of Technology, told the Global Times. Boycott mangoes Many Chinese from different fields vowed to contribute their own efforts to fight for the country, especially in the event of a military conflict. A veteran from Central China's Hunan Province, surnamed Chen, posted a picture of him in military uniform on his Sina Weibo account on Wednesday. Chen told the Global Times that "we are prepared to return to our units and are willing to fight to defend our territorial integrity." Many veterans echoed Chen by making posts with the hashtag "prepare to oblige under the call." The People's Liberation Army (PLA) Daily posted a picture of a notice on Sina Weibo, showing that a veteran in Hunan who served in the navy was recalled to his unit to perform an unspecified task from July 10 to 22. "Some navy veterans have been recalled to participate in drills and they could operate vessels skillfully after a short period training," according to the PLA Daily. Xiangya Hospital of Central South University in Hunan Province released an article on its WeChat public account on Wednesday, saying that 13 of its staff have been called to join in a drill on medical treatment on the sea and that all doctors are prepared to answer the country's call to "ensure China not to lose a little bit of its territory." Vendors who sell snacks, especially imported dried mango from the Philippines on Taobao, China's largest online shopping platform, began to change their advertisements into "we boycott any products made in the Philippines" and "the rise and fall of the nation is the concern of every Chinese and our dried mango comes from Thailand and the Guangxi Zhuang Autonomous Region, not the Philippines." According to statistics from the Philippines Department of Agriculture, mango is the third most important fruit crop of the country based on export volume after bananas and pineapple. In 2011, Philippines had an existing production area of 187,073 hectares. The mango industry supports about 2.5 million farmers. "Making Chinese Net users' voices heard via overseas social media will help the outside world understand our people's stance," Hu said, adding that however the country should prevent patriotism growing into jingoism or populism. ^ top ^

Two Chinese UN peacekeepers killed, two seriously injured in attack in South Sudan (SCMP)
Two United Nations peacekeepers from China died after an attack in South Sudan, the foreign ministry said on Monday. Five others were wounded, with two in a serious condition. One of the peacekeepers was killed at the scene and another died in hospital, state television reported. The defence ministry said an armoured vehicle was hit by a shell at about 6.39pm local time on Sunday when it was guarding a refugee camp near the UN compound in the South Sudanese capital Juba. The incident comes just over a month after a Chinese UN peacekeeper was killed and four others wounded in an attack in northern Mali claimed by al-Qaeda's North African branch. Fighting broke out in South Sudan last week between troops loyal to President Salva Kiir and his rival Vice-President Riek Machar. The clashes escalated on Sunday with gunfire outside a UN building. According to an online PLA Daily report, militants tried to enter the UN compound and the Chinese peacekeeping troops were deployed to seal the key points in the compound and refugee camp to prevent the intruders from gaining access. The peacekeepers came under heavy gunfire and a shell hit the armoured vehicle and exploded, wounding the seven soldiers inside. One of the peacekeepers, Li Lei, died from head and chest wounds. The six others – Yao Daoxiang, Wu Le, Song Xiaohui, Huo Yahui, Chen Ying and Yang Shupeng – were also wounded, with Yang dying later of his injuries. The soldiers fought back and dispersed the militants, the report said. Chinese peacekeeping troops made full efforts to treat the wounded and had stepped up precautions to ensure security, the defence ministry said. An infantry battalion of 700 military staff was stationed in South Sudan in 2014. The battalion is involved in defending and safeguarding UN staff and civilians, according to previous reports. “The Chinese army is deeply shocked and strongly condemns the attack,” the defence ministry said. “We are deeply saddened by the loss of life. We offer our condolences and sincere sympathy to the families of the dead and wounded.” UN chief seeks 2,500 more troops for Mali mission, where Chinese peacekeeper was killed( Yue Gang, a retired PLA colonel and military analyst, said it was increasingly important to amend UN peacekeeping rules that limit troops to defensive equipment. “More often peacekeeping troops cannot defend themselves in regional conflicts involving national armies and heavy weapons. Their armour and equipment should be more advanced,” Yue said. “China has the second-largest number of peacekeeping troops. So Beijing must push for a rule change.” China first sent peacekeepers to Sudan in 2006. After South Sudan became independent in 2011 it continued to deploy engineering and medical peacekeeping forces. Some 3,100 Chinese peacekeepers are serving in 10 regions around the world, including 2,400 in Africa. Most are engineers, transport experts, police and medical staff. The forces sent to Mali in 2014 were China's first overseas combat troops. President Xi Jinping promised in September to provide 8,000 personnel for UN peacekeeping operations. ^ top ^

Rights group demands release of US businesswoman held by China for alleged spying (SCMP)
A human rights group on Wednesday demanded the release of a US businesswoman held by China for alleged espionage since last year after a UN committee said she had been “arbitrarily detained”. Sandy Phan-Gillis was seized in March 2015 while crossing the border to Macau at the end of a visit to China by a trade delegation from the Texas oil capital Houston, supporters said. The American has been investigated on accusations of “spying and stealing state secrets”, according to the website, which provides information on her case. The UN Working Group on Arbitrary Detention said on Sunday that “international norms relating to the right to a fair trial and to liberty and security” had not been observed in her case. Violations by Chinese authorities were of “such gravity as to give the deprivation of liberty of Ms Phan-Gillis an arbitrary character”, it said in a report posted online. Phan-Gillis was first held for six months in a secret location and later at a detention centre in the southern region of Guangxi where she was initially placed in solitary confinement, the UN group said. The report marked the first time in the United Nation body's 25-year history that it had “ruled that [Chinese] agents have arbitrarily detained an American citizen in violation of international human rights law”, US-based rights group the Dui Hua Foundation said on Wednesday. Phan-Gillis has been allowed to see a lawyer for the first time, 14 months after she had been taken into custody, the group added in a statement. The case has badly damaged US-China relations, the group's executive director John Kamm said. He added: “Dui Hua joins the WGAD [UN working group], the American government and members of Congress in calling for Sandy Phan-Gillis' immediate release”. Phan-Gillis, who was a member of Houston's International Trade and Development Council, is currently the only American held on suspicion of spying in China, but other foreign citizens have been accused of espionage. Feng Xue, a Chinese-born US geologist who spent more than seven years in a Chinese prison after he was convicted on state secrets charges, was released last year and deported. Australian national Stern Hu, an executive with the mining giant Rio Tinto, was sentenced to 10 years in prison in 2010 on bribery and trade secrets charges. A Canadian Christian couple who ran a coffee shop in the Chinese border city of Dandong, and had aided Christians fleeing North Korea, were detained on espionage charges in 2014. The husband was formally charged with stealing state secrets and his wife bailed. ^ top ^


Domestic Policy

How high can China's population possibly go? Ambitious urban plan to house 3.4 billion people sparks concern (SCMP)
Ambitious expansion plans by small and medium towns across China have lead to the creation of more than 3,500 “new areas” for residential and economic use raising fears many are destined to become ghost towns. The combined projected population of these new areas is an “impossible” 3.4 billion people – 2.5 times the current number of people in the country, experts say. The world's population today stands at 7.3 billion, according to the US Census Bureau. Beijing has pinned high hopes on making urbanisation a new engine of growth as the economy matures and slows. But the number of towns that have rushed to join the urbanisation wave has outpaced the central government's plans. Xinhua citied a study by the National Development and Reform Commission, the top state planning body that as of May, the 3,500 new areas included 17 administered at the national level (like Shanghai's Pudong New Area), 500 economic development zones of various descriptions, 1,600 provincial level industrial parks, 1,000 city level new areas and tens of thousands of industrial parks at the town level. Many small to medium-sized towns aimed to double their populations between 2020 and 2030. “The planned population is so much higher than the current population that it clearly will not work,” Xu Fengxian, an expert on regional economy at the Chinese Academy of Social Sciences, said. The urbanisation goals also run counter to demographic forecasts of slowing population growth, even allowing for the recent decision to allow couples to have a second child. Academics predict the national population will peak in 2030 before gradually declining to 1.6 billion by 2050. Wang Yukai, a professor at the National School of Administration, told Xinhua that the main force of urbanisation was rural residents relocating to towns. “Even taking into consideration their willingness to become urban residents, or if they can afford to make the move, there is no way they could fill the 3.4 billion target,” Wang said. For the NDRC, even relocating 100 million people to meet the goals of the 13th Five Year Plan is a daunting task, which states that by 2020, 60 per cent of mainlanders will live in cities, and that 45 per cent of urban dwellers will have urban household registrations. Household registration entitles to the holder to work and enjoy services such as health and schooling in the town of birth. There are moves to make household registrations more readily transferable to other cities so that, for example, children of migrant workers can live with their parents and attend school in the cities. But even among those willing to immigrate to cities, very few are willing to resettle in small or medium-sized towns. An NDRC report on urbanisation found that 70 per cent of migrant workers went to municipal level cities while less than 10 per cent went to small or medium-sized ones. ^ top ^

Chinese paper cuts fail to stop surge in new coal-fired power plants, says Greenpeace (SCMP)
A surge in constructing coal-fired power capacity since last year has not slowed down, despite the central government introducing new measures in April to curb the trend, according to Greenpeace. The green group warned the surge would lead to a total of 400 gigawatts of overcapacity in the sector by 2020, double the current level. Three policies released by the National Energy Administration (NEA) in April – to retire outdated power plants, to set up an early warning mechanism on overcapacity risks, and to delay approving and constructing new plants in provinces with excess capacity – have so far failed to stop the surge in approvals for new plants, Greenpeace's research found. The group's calculations show these measures would see 110GW of coal-fired power projects suspended and up to 70GW retired by 2020, but changes to permitting system last year meant there were still another 295 units under construction, with a total capacity of 200GW. But two months since the policies were introduced, construction has started on two new coal-fired power plants each week in 10 provinces, Greenpeace said. Shaanxi and Inner Mongolia – the country's officially recognised power bases – saw a particularly large increase in applications for environmental permits in May, totalling more than 9GW of capacity. “China's worsening coal overcapacity crisis is acting as a dead weight on the country's energy transition,” Greenpeace energy campaigner Lauri Myllyvirta said. Moves to cut central government red tape last year gave local authorities the power to grant environmental permits for new coal-fired power plants without having to seek approval from Beijing, leading to the construction surge. Greenpeace said more than 1 trillion yuan (HK$1.2 trillion) could be “wasted” on new capacity in the next five years. The energy regulator reiterated in a document published on Tuesday that it would strictly control the pace of construction for coal-fired power. Mainland media reported that the regulator may consider suspending permits to all new coal power plants until 2020 under China's new five-year plan for the energy sector. China's coal-dominated thermal power sector has continued to expand rapidly amid an unexpectedly sharp slowdown in energy consumption growth, as well as a state-led effort to tackle smog, cut carbon emissions and encourage cleaner forms of electricity. According to the NEA, China's total thermal capacity grew 7.8 per cent in 2015 to 990GW, outstripping a 0.5 per cent increase in consumption. Another 24GW went into operation in the first five months of 2016. ^ top ^

Apprentice program to foster high job skills (China Daily)
Following a series of pilot projects, China is expected to promote a new model of apprenticeship to foster high-end skilled workers. "Apprenticeship is an essential means to promote skill development and realize successful transitions from school to work," said Yin Weimin, minister of Human Resources and Social Security. "The initiative is for building high-quality apprenticeships and developing a workforce that possesses strong capabilities in both theory and practice and meets the needs of the labor market," Yin said after the G20 Labor and Employment Ministerial Meeting on Wednesday. Apprentice program to foster high job skills Yin said skill development has always been a key topic of the G20 Labor and Employment Ministerial Meeting. In August, the Ministry of Human Resources and Social Security promoted a new model of apprenticeship that combines company training with vocational schools. Every one of the total 13 provinces or municipalities chose three to five enterprises involving about 7,000 people. Everyone under the pilot project was a worker as well as a student. Yu Zhiwei, vice-president of LinkedIn China, said the mismatch of the labor market has two aspects. "On one hand, we have an excessively large group of medium- and low-skilled workers who cannot find proper jobs; on the other hand, we have an acute shortage of professionals, innovative talent and high-end talent." According to The Human Capital Report 2016 released by the World Economic Forum, approximately 25,000 new workers will enter the labor market in developing countries every day until 2020, while more than 200 million people globally continue to be out of a job. Yet, simultaneously, there is expected to be a shortage of some 50 million high-skilled job applicants over the coming decade. Li Shanxiang, deputy head of human resources at Linyi Mining Group in Shandong province, said the company has signed a contract with Shandong Coal Technician College, aiming to leverage the skill level of 100 medium-skilled workers in two years. "We are very keen to cultivate our workers into high-skilled ones. The new apprenticeship model provides one teacher for three to five apprentices and provides special training for them." ^ top ^

China begins crackdown on online IPR infringement (Xinhua)
China on Tuesday kicked off a five-month campaign against unlicensed distribution of literature and audio and visual products on the Internet. The crackdown targets mobile device applications, e-commerce websites, online advertisements, music and video streaming websites, cloud storage services and online news providers, according to a statement released by the National Copyright Administration (NCA). It urged local police and copyright, Internet and telecom departments to strengthen supervision and "severely crack down on" intellectual property rights infringement on online forums and social-networking platforms. According to the statement, authorities will also toughen monitoring of app stores and their uploaders. The action was jointly initiated by the NCA, State Internet Information Office, the Ministry of Industry and Information Technology and the Ministry of Public Security. ^ top ^

Young Chinese legal activist 'regrets' civil rights activism (SCMP)
A young legal assistant detained for a year in a sweeping crackdown on lawyers and activists said on Sunday that she regretted her civil rights activism. But her husband said he suspected his wife was forced to recant. Zhao Wei, 24, who was an assistant to high-profile rights lawyer Li Heping, was released on bail from the Tianjin No 1 Detention Centre on Thursday and is thought to be the youngest of the hundreds of people detained in the July crackdown. After her high-profile release, several posts appeared on her microblog accounts saying she regretted her actions and accusing her former employer of receiving funds from “overseas”. The posts also rejected allegations that she was sexually abused in detention. Her dramatic change in attitude surprised many, with some questioning whether she authored the posts. Speaking to the South China Morning Post on the phone on Sunday, Zhao said she wrote the statements on her accounts. “I have come to realise that I have taken the wrong path. I repent for what I did. I'm now a brand new person,” she said. She said she wanted to speak to the media because she “realised she had made mistakes” and she “truly wanted to repent”. She said she was back at her home in Henan province and was staying with her parents. The Post could not verify Zhao's location or whether she was under surveillance during the interview. Zhao declined requests for a face-to-face interview. Her husband, You Minglei, told the Post on Monday that he suspected his wife was forced to write the posts. He said he could not contact Zhao and did not think she was truly free. “I don't think she is in a state of freedom,” You said. “I want to go to Henan [from Beijing] to find out more in the next day or two. “I don't think [she wrote] those messages uploaded to her Weibo account.” Zhao said she needed to rest before deciding what to do the next, and she had not decided whether she would continue her involvement in the rights movement. Yan Huafeng, Zhao's lawyer, said he was not in contact with Zhao but he believed Zhao's freedoms were limited. Another lawyer representing Zhao's family, Ren Quanniu, was detained for “fabricating news” that Zhao was sexually abused in the detention centre. As with those of others detained in the crackdown, Zhao's case was not brought to court. Zhao said she did not know how long she would remain on bail and she had not been told whether she will be tried at a later date. ^ top ^

Health care costs forcing China's patients into crippling debt (SCMP)
As China's medical bills rise steeply, outpacing government insurance provision, patients and their families are increasingly turning to loans to pay for health care, adding to the country's growing burden of consumer debt. While public health insurance reaches nearly all of the nation's 1.4 billion people, its coverage is basic, leaving patients liable for about half of total health care spending, with the proportion rising further for serious or chronic diseases such as cancer and diabetes. That is likely to get significantly worse as the personal health care bill soars almost fourfold to 12.7 trillion yuan (HK$14.7 trillion) by 2025, according to Boston Consulting Group estimates. For many, like Li Xinjin, a construction materials trader whose son was diagnosed with leukaemia in 2009, that means taking on crippling debt. Li, from Cangzhou in Hebei province, scoured local papers and websites for small lenders to finance his son's costly treatment at a specialist hospital in Beijing, running up debts of more than 1.7 million yuan, about 10 times his typical annual income. “At that time, borrowing money and having to make repayments, I was very stressed. Every day I worried about this,” said Li, 47, adding that he and his wife had at times slept rough on the streets near the hospital. “But I couldn't let my son down. I had to try to save him,” he said. Li's boy died last year. The debts will weigh him down for a few more years yet. Medical loans are just part of the nation's debt mountain: consumer borrowing has tripled since 2010 to nearly 21 trillion yuan and in eight years household debt relative to the economy has doubled to nearly 40 per cent, but they are growing. That is luring big companies like Ping An Insurance Group, as well as small loan firms and peer-to-peer lending platforms, as the country's traditional savings culture proves inadequate to the challenge of such heavy costs. The stress is particularly apparent in lower-tier cities and rural areas where insurance has failed to keep pace with rising costs, said Andrew Chen, Shanghai-based health care head for consultancy Parthenon-EY. “It's a storm waiting to happen where patients from rural areas will have huge financial burdens they didn't have to face before,” he said, adding people would often take second mortgages on their homes or turn to community finance schemes. China's government has moved to ramp up rural health insurance, boost coverage for major illnesses and put pressure on drug companies to slash prices, but it is an uphill battle. Official data show up to 44 per cent of families pushed into poverty were impoverished by illness. The Ministry of Health, which did not immediately respond to requests for comment, is currently investigating the impact of these costs on the country's labour force. “Typically, what happens in China is the whole family contributes when someone gets a severe disease like cancer,” said Severin Schwan, chief executive of Roche Holding, the world's biggest maker of cancer drugs. “When it comes to innovative medicines, the financial burden is just too much. Families can go broke.” Roche itself has schemes in China to make cancer drugs more affordable, including an insurance scheme developed with Swiss Re. There are no reliable figures for total health care lending, as lenders do not usually advance the money for health care specific purposes. “If you want to use it for medical bills, cosmetic surgery or plastic surgery that's all fine,” says Ping An Puhui, which advertises that its loans can “alleviate the pain of illness” and “bring new hope to sick families”. But there is plenty of anecdotal evidence from online lenders that it is a growing segment. “Our loan numbers have risen steadily and no small number of people have used these for medical purposes,” said Li Jin, a customer service worker at peer-to-peer lender “Healthcare costs are high and lots of people don't have good state cover, so they need a loan.” China Minsheng Banking Corp has launched a health care loan scheme in the western city of Chengdu, while Shanghai Pharmaceuticals Holding Co rolled out a loan scheme in April to help patients access expensive drugs. Some desperate patients are pawning their personal belongings. “They use things of various value from jewellery to purses and even cars,” said Chen Yi, an office worker at online lender “Previously the majority of people were looking for extra cash flow for their business, but last year and this we've seen a rise in health care loans.” ^ top ^

12 months after crackdown, Chinese rights lawyers call for release of detained colleagues (SCMP)
Rights lawyers on the Chinese mainland vowed to remain united amid what they say is an escalating threat to their safety as they marked the first anniversary of a sweeping crackdown that targeted hundreds in their profession. But some said the campaign had left some colleagues too afraid to take on rights cases. The far-reaching and intense crackdown had been highly organised, said a joint statement titled “Anniversary of a shattered legal dream” and released by China Human Rights Lawyers Group – a platform set up in 2013 representing about 320. “Today, the people shall witness how an occasional crackdown in the past is being replaced by constant high pressure [on social] management,” the statement said. However, it said cracking down on human rights lawyers would not make the nation more peaceful or stable, and more lawyers had pledged to work together to call for the release of their colleagues. The sweeping crackdown against mainland human rights lawyers, which began on July 9 last year with the detention of lawyer Wang Yu and her husband Bao Longjun, is widely known as the 709 crackdown. Soon afterwards, Zhou Shifeng, the director of Wang's law firm, Fengrui, and several of her colleagues, were also taken away, while more than 300 others have been investigated since then. “This is the largest crackdown seen in China's civil society since 1989,” Teng Biao, a mainland legal scholar, who is in exile, said in an interview with the South China Morning Post. “The impact of the crackdown is tremendous, but it failed to wipe out the unity and the spirit to defend China's human rights and rule of law,” Teng said. Critics say the sweeping crackdown was aimed at silencing advocates and activists and stifling the burgeoning rights defence movement since 2013. They say it shows the authorities' fear of the fast-growing civil society and their wariness of the crucial role played by an expanding community of rights lawyers in the grass-roots “rights defence” movement. Wen Donghai, who is among a new generation of human rights lawyers, agreed to represent Wang after others refused following threats. “The chilling effect of the 709 crackdown is contagious,” said Wen, a former traffic police officer. “Many lawyers chose to focus on commercial cases while others put sensitive cases on hold.” “The secret police are no longer intimidating as fear has been lost with repeated interaction,” Wen said. The sentiment was echoed by You Ming-lei, a Fuzhou-based legal assistant and the husband of Zhao Wei who has been released on bail this week after being arrested in the 709 crackdown. “In the past, there were more individual high-profile rights lawyers working on cases on their own … Lawyers have been placed under greater pressure [after the crackdown], but this has fostered more united actions of rights lawyers to work together,” he said. According to Hong Kong-based China Human Rights Lawyers Concern Group, the total number of people affected by the campaign amounts to at least 319 people. As of early this month, 24 had been formally charged, including for subversion of state power, inciting subversion and provoking social disturbance. Another 17, including legal assistant Zhao Wei, had been released on bail and 264 others freed after being harassed and temporarily detented, according to the group. Teng said he expected those charged with state subversion, such as Wang and Zhou, would likely face long jail terms as authorities were determined to use their cases to intimidate others. “I'm extremely pessimistic about their future and worried about their well-being. The cost of defending human rights... will be much higher from now on, and we see only the most courageous and determined taking on these types of cases.” Teng said he expected those charged with state subversion, such as Wang and Zhou were likely to face long terms of imprisonment as the authority was determined to use their punishments to set an example to intimidate other rights lawyers. “I'm extremely pessimistic about their futures and worried about their well-being. The cost of defending human rights in China will be much higher from now on,and we see only the most courageous and determined taking on these types of cases.” One such lawyer is Li Heping, a Christian and an employee of the Beijing Fengrui law firm, who has been officially charged with “subversion of state power”. His wife Wang Qiaoling, said her husband was far from being a hero. “He is simply a man who followed his natural instinct of wanting want to help others,” Wang said. “He is not an instigator out to overthrow power, but rather a man who chose to assist the weak and poor, who are unable to cope on their own in the face of real helplessness.” ^ top ^



Shanghai, New York agree on tourism partnership (China Daily)
Shanghai and New York City announced on Thursday the start of a two-year tourism partnership. The arrangement includes promotions in both cities, such as outdoor media advertising and tailored travel products. New York City hopes to attract more visitors from Shanghai, the largest source of outbound tourism in China, according to Fred Dixon, CEO of NYC & Company, the agency responsible for promoting New York City. Last year, the city received 852,000 Chinese tourists, 159,000 from Shanghai. Dixon estimated that the annual number of Chinese tourists would climb to 921,000 this year and at least a million in 2018. Shopping and sightseeing are two most popular activities for Chinese tourists in New York City, he said. Shanghai saw more than 636,000 tourists from the United States in 2015, up 0.61 percent from 2014. Yang Jinsong, head of Shanghai's tourism bureau, said the city has become more attractive with its new Disney resort and China's tallest building, the Shanghai Tower, which is under a trial opening. Shanghai has had a 6-day visa-free entry for international transit passengers since January and a tax refund policy for foreign tourist from 51 countries since last July. The partnership is part of the "China-US Tourism Year" that was launched in February. ^ top ^



Zhanjiang appeals to investors from all over the world (China Daily)
The coastal city of Zhanjiang, Guangdong province is pulling out all stops to display its strengths in academics, environment, policy, transportation and labor to a wider audience, in a bid to attract more investments to the southernmost city in China. A Zhanjiang (Guangzhou) Investment Promotion Conference, held at the Hotel Canton on July 12, attracted more than 200 people including influential industrial players such as the Zhanjiang Port Group and the Guangzhou Chamber of Commerce for Overseas Chinese Enterprises. During the conference, Lin Xiaowei, deputy secretary-general of the city government, said that Zhanjiang is home to five colleges and universities, second only to the provincial capital, Guangzhou. With two national forestry and aquatic seeds and seedlings bases, nine provincial-level labs, 13 provincial project centers and more than 90 corporate technology research institutes, the seaside city is rich in talented people, according to Lin. Zhanjiang is gearing up to develop itself into a modern port city, a leading city under ASEAN cooperation, a marine economy demonstration city and a Beibu rim central city. It desires to be incorporated in the national Belt and Road Initiative to fulfill its potential in transportation, Lin added. Wang Xiaosui, director of the Zhanjiang Bureau of Commerce, said that Zhanjiang has become a hot location for several overseas and domestic key projects. When the second boiler of the Sino-Kuwai Integrated Refining project is initiated on July 15, the industrial area on the Donghai Island of Zhanjiang will become a powerful facility with annual production of 10 million metric tons of steel, 15 million tons of refined oil, one million tons of ethylene and 3.5 million tons of paper, according to Wang. Zhanjiang's home appliances and aquatic products have won international applause. Lianjiang, a county-level city governed by Zhanjiang, was approved as a global purchase base of home appliances by the Swiss-based SGS Group, a world's leading inspection, verification, testing and certification company. The aquatic products in Zhanjiang have passed 14 quality-control assessments by the US, EU, South Korea, Japan, Russia and other countries and organizations, Wang added. During the 13th Five-Year Plan (2016-20), Zhanjiang will spare no efforts to develop itself into a top choice for investors from all over the world for touring, work, and residency. ^ top ^



New batch of cadres, doctors come to Tibet (Xinhua)
Wei Xiaodong has just left his comfortable post as a school manager in Nanjing and taken up a position as an elementary school vice principle in Lhasa, capital of Tibet Autonomous Region. As a member of the latest group of volunteers to work in Tibet, Wei arrived in the southwest region with more than 70 education specialists. He will work in Lhasa for about two years. "Before September, another 700 teachers will come to work in Tibet," he said. Starting last year, the Organization Department of the CPC Central Committee and Ministry of Human Resources and Social Security decided to transfer teachers and doctors to Tibet, to improve services. "A single teacher can only teach a few classes, but by coming in groups, we hope to update education in Tibetan schools," said Wei. Dozens of doctors, too, have started residencies at hospitals across Tibet. "We different specialists, which will enable us to treat patients with more complicated afflictions, and train more doctors," said Yu Yabin, the leader of a doctors' team from Beijing. New government cadres are also arriving. By the end of July, the seventh group of officials, about 1,300, will finish their three-year tenure, and return to their posts in other provinces. Statistics show about 12.8 billion yuan was invested in Tibet in the last three years. Xu Ke, a geographic survey expert from Liaoning Province, has spent most of his time charting Nagqu. The data he collected was used to build water, irrigation and heating facilities for the locals herders. "About 90 percent of my time is spent in the wild," the 30-year-old said. Vegetable and fruit prices are exorbitantly high in Pulan County, Nagri Prefecture, as the area is hard to reach. Strawberries can cost as much as 240 yuan (about 36 US dollars) per kilo. Gao Baojun, a cadre from Shaanxi Province, has been helping farmers explore new cultivation systems. "Vegetable prices are almost half now than two years ago," he said. "Volunteers from other provinces have been helping the people in Tibet, improving their lives and their children's future," said Trinley, Tibet religious affairs director. "Tibet needs skilled people to help it develop, and for the young, working in Tibet is an eye opening experience that they will cherish all their lives," said Deng Shengming, deputy director of the Organization Department of the CPC Central Committee. ^ top ^



Karamay to held forum on the Belt and Road Initiative in August (China Daily)
The Karamay Forum for the Belt and Road in Xinjiang (2016) will be held in Karamay, a large oil reserve city in China on August 9-11, according to a preparatory work meeting held on June 23. The event will include an opening ceremony, key-note speeches, and sub-forums on infrastructure construction, energy cooperation, information, manufacturing and city development. There will also be exhibitions and a closing ceremony. The Karamay forum has become an international assembly involving south, central and west Asian countries in the Belt and Road Initiative region that are devoted to Xinjiang Silk Road Economic Belt area development, according to the authorities. The forum will be jointly held by the Xinjiang Uygur autonomous region's People's Government and the Chinese Academy Of Social Sciences. ^ top ^



'Accept Hong Kong is part of China or you can't run in Legco elections' (SCMP)
In a surprise move targeting independence advocates running in September's Legislative Council elections, the government will require all candidates to declare their acceptance of Hong Kong as an inalienable part of China or face disqualification. Those who sign the declaration would be bound by it to the extent that they could face criminal sanctions if found to have lied. The move, announced on Thursday, drew instant criticism. While human rights groups condemned it as censorship of political thought, some pan-democrats also questioned its legality. The current system already requires Legco candidates to sign a declaration in the nomination form to uphold the Basic Law and pledge allegiance to Hong Kong. The new measure requires them to sign an additional form to confirm clear understanding of the mini-constitution, mainly concerning Hong Kong's status as a special administrative region of China. The undertaking covers the sections of the Basic Law stipulating that Hong Kong is an inalienable part of China with a high degree of autonomy and there is no amendment that contravenes the nation's established basic policies regarding the city. The new arrangement follows the rising tide of localism in Hong Kong, with some calling for self-determination and other extremists advocating Hong Kong's exit from China. Despite warnings from the Beijing and Hong Kong governments, some radical activists have vowed to push their ideas by competing for seats in the local legislature in September. A government spokesman said: “We take the view that advocating and promoting 'independence of Hong Kong' is contrary to the content of the declaration that the law requires a candidate to make... rendering it questionable as to whether the concerned candidate is capable of being validly nominated, causing uncertainties to the solemn Legislative Council election and confusion to electors.” The spokesman said some measures were needed in order to make sure electors knew clearly each candidate's platform and that the platform complied with the law. A spokesman for the Electoral Affairs Commission said: “In making the declaration, candidates must clearly understand the relevant context and legal consequences. Anyone making a false declaration in the nomination form is liable to criminal sanction. “The [commission] has prepared a confirmation form for the use of the returning officers in order that every candidate may confirm that in signing... he or she has clearly understood the relevant articles of the Basic Law.” In the district council elections last year, the electoral office refused to accept the election platforms of a candidate, saying his call for independence was in breach of the Basic Law and ordering him to revise it or risk the office editing the statement itself. Hong Kong Human Rights Monitor director Law Yuk-kai criticised yesterday's move as “censorship of political ideas” and a breach of “freedom of thought”. Independence advocate Edward Leung Tin-kei, who is considering running for Legco, said he had decided not to sign the form after consulting lawyers. “If I have to sign it in order to get my nomination accepted, I will seek a judicial review. I will still speak of my ideal at election forums because this is my freedom of thought.” Pro-Beijing lawmaker Starry Lee Wai-king said the new rule was reasonable because legislators would have to pledge allegiance to the Basic Law after being elected anyway. ^ top ^

'Grave concern' shown over H$172 million in lost government revenue (SCMP)
“Grave concern”has been expressed at the inability of a government department to collect HK$172 million in outstanding rates and rents as of last year. Lawmakers now want action from the Rating and Valuation Department to ensure the government no longer loses out. Abraham Razack, chairman of the Public Accounts Committee, yesterday tabled a report in response to the losses revealed by the Audit Commission in April. He said the department had “not made its best efforts in collecting rental information, making interim valuations, collecting rates and government rents, and taking follow-up actions on ineligible rates-exempted cases”. In some cases, landlords simply ignored repeated attempts to get them to pay up. Of the HK$172 million, 54 per cent had been owed for less than a year,15 per cent between one and two years, and 31 per cent two years or longer. In one case, a landlord with 16 properties owed the government rates and rent as far back as 2007. The government collects rates and rent at 5 per cent and 3 per cent respectively of a property's estimated annual rental value. The committee also expressed “grave concern” about a department decision not to collect rates on both unassessed illegal structures, and assessed structures already hit with removal orders. An assumption by the department that such building works would not be permanent was “not always valid”, Razack said, because 100,000 unauthorised works had remained outstanding for two years or longer as of 2015. The committee also hit out at the department for not making “sufficient efforts to coordinate and solicit support” from the Buildings Department, Lands Department and the Home Affairs Department to assist in the assessment of rates and rents in a timely manner. It suggested the department be given more resources and manpower to cope with its already heavy workload. The committee quoted Secretary for Financial Services and the Treasury Professor Chan Ka-keung as saying that the government would establish a system to keep track of progress made on removal orders for structures. With the end of the Legislative Council term nearing, Razack reflected on his time as chairman and the most serious matter the committee had handled. He said this involved a series of blunders by the Civil Aviation Department, which had come under fire for procuring a new air traffic management system that should have been in use years ago. Razack criticised the Transport and Housing Bureau for not having properly supervised aviation department work. “We don't have the power to administer penalties, but our power rested with us as a supervisor of government procedures,” he said. ^ top ^



Taiwanese angered over Hague ruling on Taiping Island (Global Times)
The Hague's arbitration ruling that degraded Taiping Island to a rock has angered people from Taiwan, who insist on calling the island self-sufficient for human activity. Under the arbitration ruling handed down by The Hague on a case filed by the Philippines, none of the islands of the Nansha Islands, including Taiping Island, can be considered as islands under international law. Similar to reactions on the Chinese mainland, the award sparked angry voices from the island, and Taiwan leader Tsai Ing-wen also criticized it as jeopardizing Taiwan's rights, Taipei-based Central News Agency (CNA) reported. As the largest island of the Nansha Islands, Taiping Island covers 510 square meters. Since Taiping Island was degraded to a rock, some Chinese began to question the status of the Okinotori Islands of Japan, which is 9.44 square-meters large. It's wrong to focus on the western side, said Huang Kwei-bo, an associate professor at the Department of Diplomacy of National Chengchi University in Taiwan. "Taiping Island has freshwater and one can raise chicken and other plants on the island. It can also be a fishing base. The award on Taiping Island obviously does not meet the facts," Huang was quoted as saying by Ta Kung Pao. Xinhua News Agency said Taiping Island was returned to China in 1945 after Japan surrendered. A weather station and a wireless radio station are located on the island. According to Hong Kong-based Ta Kung Pao, a coastal patrol, medical staff and scientists live in Taiping Island, or about 120 people. The Taiwan government website said Taiping Island is rich in natural resources and has a freshwater well. Natural vegetation includes coconuts, papaya and plantain. Taiping Island, located some 1,600 kilometers away from Taiwan Island, is primarily responsible for offering materials and medical supplies at sea. It can also enhance emergency rescue efforts, the government website explained. An airport and seaport were completed on Taiping Island in 2015. In the same year, a lighthouse was put into use on the island, which not only guides passing vessels but can provide solar energy for people on the island. A delegation of former Taiwan senior officials visited Taiping Island on May 6, and former Taiwan leader Ma Ying-jeou also visited the island in January, Xinhua reported. The delegation visited a wharf, a lighthouse, a photovoltaic facility, a post office, a hospital, a farm and a well, said Xinhua. Speaking aboard a frigate which left for a patrol mission near the Nansha Islands on Wednesday, Tsai said it is time to be resolute to protect Taiwan's maritime interests, and that "the mission carries special significance after yesterday's developments [Hague award] on the South China Sea," CNA reported. ^ top ^

Taipei to hasten frigate patrol for Taiping Island in wake of South China Sea ruling (SCMP)
Taipei will bring forward plans to send a frigate to patrol waters near the biggest land feature in the Spratlys after a Hague tribunal ruled on Tuesday that Taipei-controlled Taiping Island was a “rock” that conferred no exclusive maritime rights. Taiwanese Foreign Minister David Lee said President Tsai Ing-wen was expected to take “action” on Wednesday after top-level national security meeting on Tuesday on the Permanent Court of Arbitration's ruling. Lee refused to specify the action but local news media said Tsai was likely to board a La Fayette-class frigate to boost the crew's morale before the vessel set off for Taiping. An emergency response centre has also been set up at the defence ministry. Although the ruling was a result of a dispute between Beijing and Manila over claims to disputed land formations and waters, Taipei found the tribunal's reference of Taiping unacceptable, saying Taiwan has long considered the 46 hectare feature an island. “The ruling, especially the part involving Taiping Island, has seriously hurt our rights over the islands in the South China Sea, and we can never accept it,” the Presidential Office said. It added that the ruling was not legally binding, and it would do all it could to uphold Taiwan's sovereignty claims to “various islets” and their surrounding territorial waters. “The Republic of China [in Taiwan] enjoys every right in line with the international law and the United Nations' Convention on the Law of the Sea regarding the islands in the South China Sea.” The ROC regime took control of Taiping after Japan's surrender in the second world war and stationed military personnel there even after the regime retreated to Taiwan. The mainland inherited the ROC's claim to the South China Sea, including the U-shape “nine-dash” line first promoted by the ROC regime in 1947. Tuesday's ruling also said the line contravened Unclos. In Beijing, the State Council's Taiwan Affairs Office said both the mainland and Taiwan should safeguard territorial sovereignty and maritime rights in the South China Sea. Xinhua quoted TAO spokesman Ma Xiaoguang as saying the two sides shared responsibility for the overall and fundamental interests of the Chinese nation. Relations between the mainland and Taiwan have been strained since the Tsai took office in May and official communication has stalled. Analysts said the Tsai government had adopted a strategy of maintaining outright claims to Taiping, but keeping an ambiguous position towards the nine-dash line. “This is because Taiwan has physically controlled Taiping, making it a must for the Tsai government to stand firm on Taipei's claims,” said Edward Chen I-hsin, professor of international studies at Tamkang University in Taiwan. ^ top ^



China's GDP rises 6.7 per cent in the second quarter of 2016 (SCMP)
China's gross domestic product rose 6.7 per cent in the second quarter from the same period of last year – largely in line with market expectations, the National Bureau of Statistics said on Friday. It remained unchanged from the 6.7 per cent recorded the first quarter, which marked the slowest pace since 2009. China's Premier Li Keqiang has repeated several times recently that the economy has continued the steady momentum seen in the first three months. Fixed-asset investment, a key gauge to check resilience of the growth, rose 9 per cent in the first half of the year, lower than the 9.6 per cent in the first five months. Investment from the private sector, a recent policy focus, continued to lose steam despite Beijing's efforts to revitalise the impetus of private capital. The growth rose 2.8 per cent in the first half, down from the rise of 3.9 per cent in the first five months. The momentum of property investment is also fading as the growth slowed to 6.1 per cent in the first half from 7.0 per cent in the first five months. Industrial output rose 6.2 per cent in June, compared with May's rise of 6.0 per cent. ^ top ^

EU to debate China's market status (Global Times)
The European Commission will debate the market- economy status of China on July 20, and China's steel overcapacity will be a factor involved in the debate, European Council President Donald Tusk said at a news conference in Beijing on Wednesday. "The Commission is finalizing an impact assessment of the consequences entailed by the end of Article 15 of the WTO accession agreement with China," Tusk said at the conference. At an EU-China business summit on Wednesday, Chinese President Xi Jinping said China hopes the EU will carry out its obligations as delineated in Article 15 as scheduled, the Xinhua News Agency reported. "Article 15 says that all WTO members should stop following replacing country measures in anti-dumping cases. Based on these rules, importers can use production costs incurred in a third country to define the value of exports from a nonmarket economy when calculating the dumping margin," explained Jin Bosong, a researcher at the Economic Cooperation Research Institute of the Chinese Ministry of Commerce. "Once the EU recognizes the market-economy status of China, importers will not need a third country to calculate the exporter's dumping margin, which gives the EU no excuse to accuse China of dumping anymore," said Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation. According to Euler Hermes, the world's leading provider of trade-related credit insurance, the eurozone will lose 7 billion euros ($7.76 billion) if China is admitted as a market economy. However, the Washington-based Economic Policy Institute claimed 3.5 million people will lose their jobs if China does not get market-economy status. Tusk also emphasized the link between steel overcapacity in China and the country's market-economy status. "The overcapacity of China is exactly twice the entire steel production of Europe, which is demonstrating what kind of problem we have to face." He noted that a joint platform for "verification and monitoring mechanisms" will be formed between China and the EU to inform ongoing debates related to steel overproduction. Chinese Premier Li Keqiang, speaking at the summit on Wednesday, said that China is committed to market reforms and is determined to tackle a glut in steel capacity that has sharpened tensions. Steel overcapacity is a global problem because the economy is getting weak, demand is shrinking and China is conducting structural reform,thus compressing its capacity, said Bai, adding that there should be no connection between steel overcapacity and discussions of market-economy status because overcapacity is precisely the result of market economy mechanisms. ^ top ^

Catch'em all: Pokémon Go game becomes an online hit in China (China Daily)
Gamers in Chinese mainland are increasingly upset over their lack of access to Pokémon Go, the latest Nintendo smash-hit game sending countless smartphone addicts worldwide outdoor to hunt down fictional creatures. The Augmented Reality (AR) game has been launched in the US, Australia, New Zealand and Japan last week and became an instant hit. With the help of GPS, the app shows an animated version of Google maps with Pokémon (short for pocket monster) as the users wander through the real world. When Pokémon are within range, gamers' phones vibrate and show the Pokémon dancing around in real-time. To catch the Pokémon, you'll throw a Pokéball at the Pokémon by swiping towards it. The Nintendo-owned franchise Pokémon exploded in popularity in the late 1990s. Its video game series has sold over 200 million copies in the last decade. The new game, designed for smartphones and released on Thursday, has sent shares of Nintendo skyrocketing by nearly 25 percent on Monday. By Friday, it had already been downloaded more than a million times on Android and Apple devices. At the same time, frustration is found among those potential Pokémon trainers in Chinese mainland due to lacking of access to the magical app, which encourages its users to "catch'em all". "This is the first time that I actually want to play a game," said Jemye, a user on Sina Weibo. "I spent a long time on my phone but it doesn't work." Another user named ZhangHanWen-Show complained, "I am waiting for the unlocking of the Chinese market. It feels everyone in the world is playing the game except me." "I want to play Pokémon Go too! I want to catch Pikachu (a kind of Pokémon) and I really don't mind walking all over the building!" JangHoYoung cried. "Travel agencies should consider offering Pokémon Go oversea tour package if Nintendo didn't unlock the game in China," Kongbaiyinying suggested. Hopes for unrestricted access to Pokémon Go were further ignited Monday when users reported that the geographical block had been lifted; only to find that it had been reinstated a short time after. Some shoppers soon found the huge potential in the void. Search "Pokémon Go" on China's biggest online retailer Taobao and you can buy Apple IDs registered in countries where the game is available, for as little as 2 yuan ($0.3). Moreover, a Shenzhen-based company has rolled out a similar game called CityFairies: Go providing users with virtual creatures that can be conquered and captured according to the player's position. It is currently the number one free download in Apple's app store in China. Rumors have it that China's Tencent is going to agent the game in Chinese mainland. The report was later denied by Tencent. ^ top ^



DPRK lashes out against THAAD deployment in S. Korea (Global Times)
The Democratic People's Republic of Korea (DPRK) Thursday slammed South Korea for its decision to deploy Terminal High Altitude Area Defense (THAAD) despite strong opposition at home and abroad, saying that Seoul was "kowtowing to the US brigandish demand." By doing so, the South Korean government "sold off the destiny and interests of the nation and harassed regional peace and stability," a spokesman for the Committee for the Peaceful Reunification of Korea said in a statement carried by the state-run news agency KCNA. The THAAD deployment has revealed the intention of South Korean President Park Geun-hye to seek escalated confrontation between the two Koreas and even northward invasion, said the statement. The statement also warned that the Park administration will "have to pay most severely and bitterly" for this decision as it has "submitted to the US" and "offered the Korean Peninsula to foreign forces." South Korea's Defense Ministry on Wednesday announced an agreement with the United States to deploy the US THAAD missile defense system to its southeastern Seongsan-ri region despite continued opposition from neighboring countries. Last Friday, Seoul and Washington officially announced the decision to deploy US interceptors to South Korean soil as part of defense measures to defend the military forces of the South Korea-US alliance and protect the safety of South Korea and its people from the DPRK's nuclear threats and ballistic missiles. However, the decision enraged people living in the region, with some writing in blood to express strong opposition to the deployment of the THAAD, whose X-band radar is known to emit a super-strong microwave detrimental to the human body. The DPRK on Monday vowed to take physical countermeasures against the THAAD deployment in South Korea, threatening "merciless retaliatory strikes to reduce South Korea to a sea of flames." The THAAD, developed by the US-based defense company Lockheed Martin, is designed to shoot down missiles at an altitude of 40-150 km using a hit-to-kill approach. It is composed of six mobile launchers, 48 interceptors and a radar and fire control system valued at about 1.5 trillion won (1.3 billion US dollars). ^ top ^

China urges halt of THAAD deployment in ROK (Xinhua)
China on Wednesday urged the United States and the Republic of Korea (ROK) to halt the the deployment of a U.S. anti-missile system in the ROK. Earlier in the day, the ROK's defense ministry announced an agreement with the United States to deploy the U.S. missile defense system, called Terminal High Altitude Area Defense (THAAD), to its southeastern region despite continued opposition from neighboring countries. The THAAD deployment would gravely damage the strategic balance in the region as well as the strategic security interests of countries in the region including China, Foreign Ministry spokesperson Lu Kang told a routine press briefing. The move also contravenes efforts to maintain peace and stability in the Korean Peninsula, he said, reaffirming China's strong opposition to it. He warned that China will take necessary measures to safeguard its own interests if the United States and ROK don't stop the deployment. According to media reports, one THAAD battery will be deployed to the Seongsan-ri region of Seongju County in North Gyeongsang Province, where the ROK Air Force's Hawk surface-to-air missile battery is located. ^ top ^



China, Mongolia forge closer ties (Xinhua)
China and Mongolia Thursday agreed to speed up the alignment of development strategies and boost cooperation to forge closer ties, as Chinese Premier Li Keqiang was visiting this landlocked country. "We both agreed to steer the development of bilateral ties into the right direction," Li told a joint press conference after talks with his Mongolian counterpart Jargaltulga Erdenebat. Li, in a meeting with Vietnamese Prime Minister Nguyen Xuan Phuc, reiterated China's stance on the South China Sea issue, saying that any dispute should be solved through bilateral negotiations by parties directly concerned. Li arrived in Ulan Bator on Wednesday afteroon to pay an official visit. It was his first trip to Mongolia since he took office in 2013. Sharing a 4,710-km-long borderline, China and Mongolia have witnessed warmer relations in recent years thanks to closer economic links and political trust. During his talks with Erdenebat, Li said that China and Mongolia are neighbors, friends and partners, and the two countries have maintained a good momentum in building a comprehensive strategic partnership reached by both sides in August 2014. Li said that the two countries respected each other's core interests and major concerns. China respected Mongolia's state sovereignty, independence and territorial integrity, as well as the development path chosen by the Mongolian people. "China looks forward to working with Mongolia's new government in continued efforts to consolidate political mutual trust and maintain exchanges between high-level officials, so as to deepen cooperation in all respects," Li said. Li said the two neighbors are economically complementary and new opportunities in deepening cooperation have become available. China stands ready to dovetail its Belt and Road Initiative with Mongolia's Steppe Road program. China is also willing to start a feasibility study on a free trade pact with Mongolia. Besides, China stands ready to make new progress with Mongolia in such fields as the processing of farm and pasture products, housing and infrastructure, said Li, who also suggested the two sides strengthen financial cooperation and expand currency-swap scale, and enhance people-to-people exchanges. Erdenebat, for his part, said that economic cooperation and trade are major pillars in bilateral ties and the Mongolian side is willing to advance cooperation with China in such fields as agriculture, livestock farming, energy, minerals and infrastructure, he said. Erdenebat welcomed more investment from Chinese firms, adding that Mongolia is positive with starting the feasibility study of a free trade pact. China has for years been Mongolia's largest trading partner and largest source of foreign investment. According to official statistics, two-way trade has expanded 50 times over the past two decades. Following the talks, Erdenebat and Li witnessed the signing of 15 cooperation agreements ranging from trade, technology and infrastructure to radio and TV broadcasting. Li also met with Mongolian President Tsakhiagiin Elbegdorj and Chairman of the State Great Hural Miyegombo Enkhbold in the day to discuss ways to improve bilateral ties. On Thursday, Li also met with leaders of Vietnam, Latvia and Laos, all of whom will attend the 11th Asia-Europe Meeting (ASEM) Summit to be held in Ulan Bator from July 15 to 16. Li told his Vietnamese counterpart that the South China Sea issue should be solved through bilateral negotiations by relevant parties on the basis of historical facts and in accordance with international law and the Declaration on the Conduct of Parties in the South China Sea (DOC). The DOC, signed in 2002 by China and the Association of Southeast Asian Nations (ASEAN) member states, including the Philippines, stipulates that the parties concerned undertake to resolve their territorial and jurisdictional disputes by peaceful means, through friendly consultations and negotiations by sovereign states directly concerned. On the award issued Tuesday by an arbitral tribunal in The Hague, Li said China has been very clear on its stance of not recognizing or accepting the award. The DOC has helped maintain peace and stability in the South China Sea over the past years, he said. The Chinese premier called on Vietnam to value the hard-won momentum in the development of bilateral relations and jointly safeguard peace and stability in the South China Sea with China. Nguyen Xuan Phuc, for his part, said Vietnam respects China's stance on the arbitration, which was unilaterally initiated by the Philippines, and Vietnam maintains that the disputes should be solved peacefully through negotiations. On bilateral ties, Li said China-Vietnam relations have shown a positive momentum since last year, with early results yielding in maritime, land and financial cooperation. Phuc said Vietnam and China enjoy a "comradely and brotherly" relationship with common interests significantly overriding differences. Vietnam stands ready to push forward the mechanism of bilateral maritime negotiations and properly manage differences with China, so as to contribute to regional peace and stability, Phuc said. In a meeting with Latvian President Raimonds Vejonis, Li said China is ready to join hands with Latvia to synergize their development strategies, promote cooperation in such areas as transportation, infrastructure construction and trade, achieve dynamic equilibrium of bilateral trade, and boost people-to-people exchanges in youth, media, tourism and other areas at different levels. China supports Latvia in hosting the fifth leaders' meeting between China and Central and Eastern European (CEE) countries. China is willing to work with Latvia to promote cooperation within the China-CEE framework -- known as s16+1 -- so as to benefit both sides, Li added. ^ top ^

Asia-Europe Business Forum starts today (Montsame)
Prime Minister J.Erdenebat made opening remarks at the 15th Asia-Europe Business Forum (AEBF15) commenced Wednesday in the State House, Ulaanbaatar. In his speech, the Premier expressed the satisfaction with the gathering of leading people of the private sector and foreign and domestic investors on the 20th anniversary of the ASEM. He pointed out that Mongolia has hosted nine sideline meetings so far ahead of the ASEM Summit. “Today's meeting has attracted some 700 people from 43 countries to share their own views. Mongolia is geographically located between Russia and China, which means that Mongolia creates favorable condition for transit transportation. The country is focusing attention to creating more favorable condition for doing business,” the Premier emphasized. The AEBF15 will hold discussions with topics “Developing participatory economy”, “Asia-Europe economy”, “Merging small- and middle-sized business with international VAT network” and “Investment and green development”. ^ top ^


Mrs. Lara Nadine Fritschi
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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