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
  1-5.5.2017, No. 670  
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Swiss ambassador to China: Initiative is platform for multilateralism (Xinhua)
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Foreign Policy

Rickety boats used to smuggle migrants into Europe 'made in China' (SCMP)
The European Union has a long list of products it says China sells too much of in its markets. Add inflatable boats to the list. “The rubber boats used by the smuggler networks in the Mediterranean are fabricated somewhere in China,” Dimitris Avramopoulos, the EU's commissioner for migration, home affairs and citizenship, told journalists in Beijing on Thursday after he met China's Minister of Public Security Guo Shengkun. At least 1 million people, mostly from the Middle East and North Africa, crossed the Mediterranean bound for Europe in 2015, with the number fell to 327,000 in the first 10 months of last year. Many of the crossing attempts are made using small boats far too small and unstable for open rough waters, and deaths from drowning are not uncommon. Last year, some 3,800 fatalities were recorded. But the rafts are relatively inexpensive and easily purchased. A search on Chinese e-commerce platform found more than 2,500 companies selling different types of inflatable boats with the unit price as low as US$10. Alibaba Group owns the South China Morning Post. It's not known how many boats made in China are being used by smugglers to move the refugees, but Avramopoulos said he had requested cooperation from the Chinese authorities to “track down this business and dismantle it, because what they produce is not serving the common good of the country. It is a very dangerous tool in the hands of ruthless smugglers”. Most of the asylum seekers have ended up in Germany but large numbers have also gone to Sweden. The EU has made a deal with Turkey to stop Syrian refugees from reaching Greece and the overland route to Germany, in return for EU funds, which has reduced the flow greatly, but thousands of migrants still try to reach Europe from Libya via sea routes. The EU has struggled with distributing the refugees among member states. Avramopoulos said he did not discuss with Guo, who is also a Chinese state councillor, the possibility of sending some of the refugees to China. “It's too early to discuss it,” he said. He announced the EU and China would start negotiations on a visa facilitation agreement, as well as on an agreement on cooperation in combating illegal migration. The two negotiations would be concluded in parallel, he said. On the issue of China's global hunt for graft fugitives, Avramopoulos said the EU would be a China's “strategic partner” but insisted the action was China's internal matter. ^ top ^

Beijing holds security cooperation dialogue on Belt and Road Initiative (Xinhua)
A security cooperation dialogue on the Belt and Road Initiative, attended by officials from more than 20 countries, was held Thursday in Beijing. Enhancing international cooperation to tackle risks and safeguard security for the Belt and Road Initiative is the common task for all countries, said Meng Jianzhu, head of the Commission for Political and Legal Affairs of the Communist Party of China (CPC) Central Committee. Meng called on attendees to make full use of the dialogue to enhance exchanges of information and deepen security and law-enforcement cooperation. More than 100 countries and international organizations have already joined the Belt and Road Initiative, a China-proposed trade and infrastructure plan connecting Asia with Europe and Africa. "Cooperation in trade, investment, and infrastructure have been growing, thanks to the Belt and Road initiative, " Meng said, adding that the forthcoming Belt and Road Forum for International Cooperation will push for further cooperation. The high-profile forum, which will be held from May 14 to 15 in Beijing, will see at least 28 heads of state and government. "We hope that all sides would foster the concept of common and cooperative security, and establish a sound security cooperation mechanism for the Belt and Road Initiative," China's Public Security Minister Guo Shengkun said at the opening ceremony of the dialogue. Guo called for stepping up pragmatic cooperation in such areas as public security, anti-terrorism, and protecting overseas interests. Participants attending the dialogue pledged to strengthen security cooperation with China for the Belt and Road Initiative ^ top ^

China, Denmark adopt collaborative work plan (China Daily)
China and Denmark will strengthen cooperation in areas such as fishing, agriculture, food safety and drug regulations through a new collaborative work plan for the next three years, which is expected to bring the two countries' relationship to a new height. Premier Li Keqiang and Prime Minister Lars Loekke Rasmussen of Denmark agreed to the joint work plan for their two nations from 2017 to 2020 during their meeting in Beijing on Wednesday. The plan details the road map and timetable for further cooperation. Rasmussen was making the first official visit by a Danish prime minister since the two countries established comprehensive strategic partnership in 2008. Li said he believes China and Denmark have great potential for further cooperation. And, as next year will mark the 10th anniversary of the comprehensive strategic partnership, China is willing to use this opportunity to explore more cooperation between the two countries. Denmark is the first Nordic country to sign such agreement with China. Li stressed that China also is willing to work with Denmark in dealing with regional issues and international affairs while promoting free trade and investment convenience. Rasmussen praised China's rapid development since his last visit in 2010, and said China has shown increasing leadership on important global issues such as climate change. He expressed his willingness to fully implement the three-year work plan between the two countries and said Denmark, a firm supporter of free trade, warmly welcomes investment from Chinese companies. He also said as a member of the European Union, Denmark will promote the bilateral investment treaty between China and the EU to deepen relations. After the meeting, Li and Rasmussen observed as the signing of six documents: on food and drug regulations, quarantine and sanitary requirements and giant panda protection, among others. Liu Weimin, deputy director of the Department of European Affairs at the Ministry of Foreign Affairs, said the two leaders had long and candid discussions on promoting free trade amid increasing trade protectionism. He said Li emphasized that free trade benefits all countries and contributes to global peace and stability as well as the recovery of the global economy, while trade protectionism serves the no one's interests. Liu said the two leaders agreed to send strong signals to promote free trade and globalization in the upcoming China-EU Leaders' Meeting. Liu said both countries would work to enhance cooperation and, as 2017 is the year of tourism between China and Denmark, the first such activity between China and an EU country, steps to increase tourism were part of Wednesday's discussion between the leaders. China remains Denmark's largest trade partner in Asia with their bilateral trade reaching more than 110 billion Danish kroner (about $16.11 billion) a year, according to Denmark's statistical authorities. ^ top ^

Xi, Duterte discuss ties, regional cooperation (Global Times)
Chinese President Xi Jinping and his Philippine counterpart, Rodrigo Duterte, spoke over the phone Wednesday, agreeing to engage in more practical cooperation and close communication. Xi said bilateral ties have improved greatly after the two met twice last year and reached important agreements, the Xinhua News Agency reported. The two countries are deepening mutual political trust and cooperating in various fields, Xi said. Duterte said in the phone call that he was happy to see the enhancement of bilateral friendship and solidarity, as well as the restoration of their exchanges and cooperation in various areas, Xinhua reported. Duterte added that he looks forward to attending The Belt and Road Forum for International Cooperation from May 14 to 15 in Beijing. Including Duterte's visit in mid-May, the Philippine president will have visited China twice half a year after taking office, which shows the importance Duterte attaches to bilateral ties, and the phone call shows China's appreciation of this, said Li Kaisheng, a research fellow at the Shanghai Academy of Social Sciences. Duterte reversed the pro-US policy of his predecessor Benigno Aquino III, whose administration filed an arbitration case against China over the South China Sea disputes at the Hague arbitral court. China has repeatedly rejected the court's ruling in July 2016. A joint statement at the recently concluded Association of Southeast Asian Nations (ASEAN) summit in the Philippines refrained from criticizing China over "land reclamation and militarization" in the South China Sea. The statement took China's interests into consideration and the Philippines, as this year's rotating ASEAN chair, has played a role in supporting China, Li told the Global Times on Wednesday. A channel for dialogue and consultations on the South China Sea issue has also been set up, said Xi. The two countries need to maintain friendly relations and push for practical cooperation Xi added. As this year's ASEAN chair, the Philippines is ready to advance the bloc's relations with China, and to maintain close communication and cooperation with Beijing in international and regional issues, said Duterte. The two leaders also exchanged views on the Korean Peninsula situation. Xi said China firmly supports the realization of a denuclearized peninsula and for maintaining its peace and stability, saying the issue should be resolved through dialogue and consultations. The Chinese president urged all relevant parties to exercise restraint and return to the right track of dialogue and negotiations. China is willing to see ASEAN's active role in securing regional peace and stability, he noted. ^ top ^

China welcomes ASEAN summit statement (Global Times)
China on Tuesday welcomed a statement from the Association of Southeast Asian Nations (ASEAN) summit and reaffirmed cooperation with ASEAN on the South China Sea issue, China's foreign ministry said. "We read the chairman's statement from the 30th ASEAN summit concerning the South China Sea issue. With the joint efforts, the situation is becoming more positive," Geng Shuang, Chinese foreign ministry spokesperson said in a daily press briefing. According to the statement, ASEAN leaders noticed improvements in cooperation between ASEAN and China, and welcomed progress on a framework for the Code of Conduct in the South China Sea (COC) to be completed by the middle of 2017. China was ready to work with ASEAN countries to implement the Declaration on the Conduct of Parties in the South China Sea (DOC), deepen maritime cooperation, agree on a timely negotiation-based COC, and jointly maintain peace and stability in the South China Sea, Geng said. The spokesperson said China and ASEAN members are scheduled to finish consultation on a draft COC in the first half of 2017. ^ top ^

Chinese naval fleet starts friendly visit to Philippines (Xinhua)
A Chinese naval fleet has begun a three-day friendly visit after arriving Sunday at Davao City in the southeastern region of The Philippines. It is the first time for a Chinese naval fleet to visit Davao, the country's third largest city. The Philippine side held a grand welcome ceremony at the Port of Davao. Miao Hua, Political Commissar of the People's Liberation Army Navy, who is leading a Chinese delegation to visit The Philippines, addressed the ceremony. He said that the visit would strengthen the relationship between the Chinese navy and the Philippine navy and contribute to the development of traditional friendship and bilateral ties between the two countries. Rodrigo Duterte, mayor of Davao city, said that it is her sincere hope that the visit would promote exchanges on maritime issues and maritime cooperation between the two sides. She also believed that the visit would enhance peace and friendship between the two countries. During the visit, the two sides will hold a series of activities such as open day to naval vessels, deck reception and cultural and sports competitions. ^ top ^

Comment: Trump's policy on Asia is a shambles (SCMP)
Nearly a hundred days into the administration of US President Donald Trump and we are still confronted by an empire in utter chaos, a whimpering superpower with no clear foreign policy direction. While it has promised to “remain active and engaged in Asia” under “its own formulation”, so far what we mostly see is an unbearable policy dissonance that is chipping away at the United States' credibility in the region. Already struggling with historically low trust ratings, with the majority of Americans expressing their distrust in the president's ability to make good on his promises, the “art-of-the-deal” Trump is under pressure to deliver. On the domestic front, the White House has suffered successive legal setbacks vis-à-vis its controversial travel ban on several Muslim-majority countries. Then came the dead-on-arrival American Affordable Care Act, also known as “Trumpcare”, which had little chance of survival amid vicious criticism by both Republicans and the entire Democratic bench in Congress. Meanwhile, US foreign policy, particularly in Asia, is still, to put it mildly, under construction, with no clear resolution in sight. Trump has yet to assemble an “Asia team”, which will oversee the day-to-day operations of the National Security Council, Pentagon and State Department in the region. Both Defence Secretary James Mattis as well as Secretary of State Rex Tillerson have struggled to get their preferred undersecretaries in place. In many cases, the issue seems to be more political rather than meritocratic. Mattis failed to install Mary Beth Long, a veteran Pentagon official, while Tillerson failed to install Elliott Abrams, a prominent neo-conservative wonk, as their undersecretaries. This was reportedly due to their earlier participation in the “Never Trump” campaign, featuring 150 leading Republican national security experts. The latest victim of this bizarre political vendetta was Patrick Cronin, a leading Asia expert, who was forced to withdraw his selection as the incoming director of the Pentagon-funded Asia-Pacific Centre for Security Studies in Honolulu, Hawaii. The abrupt and surprising firing of Obama-era American ambassadors has also left a huge, though temporary, diplomatic vacuum in leading capitals across Asia. The steep cut, 28 per cent, in the State Department's budget, which was opposed by Trump's leading generals, is not going to help either. As a result, Tillerson has been left disempowered, diffident and increasingly marginalised, a captain of a ghost ship with seemingly no direct influence on shaping US foreign policy. The upshot is a gnawing competence gap in the American foreign policy establishment, undermining the ability of Washington to craft, never mind effectively implement, a coherent and nuanced policy in Asia. Throughout his presidential campaign, Trump offered a vision of a militarily-strong and diplomatically intransigent America, which will unmistakably place the interest of its own citizens before that of friends and rivals. He has promised to increase US military spending by 10 per cent and build a massive 350-ship naval fleet, featuring a diverse array of carriers, attack submarines and littoral combat ships. Although the North Atlantic Treaty Organisation and European allies have failed to escape his scathing remarks, the new US president has been primarily focused on American interests in Asia. Along the way, Trump threatened both rivals and allies, namely China and Japan, with punitive sanctions to address the US' gnawing trade deficit, while threatening weaker allies such as South Korea with strategic abandonment. He even threatened to revisit the decades-long one-China policy to Beijing's utter outrage. The past three months, however, saw senior US officials, namely Mattis, Tillerson, and Vice -President Mike Pence, embarking on a relentless tour aimed at reassuring perturbed European and Asian allies. In fact, during his visit to China, Tillerson struck an uncharacteristically cordial tone, advocating a Sino-US relationship based on the principles of “non-conflict, non-confrontation, mutual respect, and win-win cooperation”. Even Trump himself has walked back much of his earlier tough talk, now reassuring Japan of his “100 per cent” support, while extending an olive branch to China. To be fair, Trump summit with Chinese President Xi Jinping at the Mar-a-Lago resort went smoothly and according to the script, but there were no concrete agreements between the two superpowers on key areas of disagreements, especially trade. Even on defence issues, there seems to be no coherent policy or change, although Trump has taken a more aggressive position on Syria, Afghanistan and North Korea, which has pleased the Republican base, but perturbed strategists and international partners. In the South China Sea, for instance, the new administration promised a tougher approach through expanded and more aggressive freedom of navigation operations in the area, primarily aimed at challenging China's maritime claims around reclaimed land features in the Spratly and Paracel chain of islands. Earlier, Tillerson went so far as dangling the option of naval blockade, while the influential White House adviser Steve Bannon did not shy away from fantasising a direct confrontation with China over the South China Sea. More recently, however, the Pentagon has failed to secure White House approval to conduct routine freedom of navigation operations in the area. Meanwhile, until Pence's brief visit to Jakarta, smaller allies and partners in Southeast Asia anxiously awaited a single major US policy pronouncement vis-à-vis the Association of Southeast Asian Nations. Throughout the region, there is growing fear that Trump's trade protectionism may eventually extend to smaller economies such as Vietnam, Thailand, Malaysia and the Philippines, which also run substantial trade surplus with the US. It isn't even clear whether Trump will attend any of the major Asean-led multilateral events, namely the East Asia Summit, as well as the Asia Pacific Economic Cooperation summit later this year. Even if he does choose to attend, it is doubtful whether Trump will put any concrete trade and economic initiatives on the table. At this juncture, the US doesn't seem to have either a coherent diplomatic or defence strategy in Asia. Ultimately, America is still too big to fail, thus many still hope and encourage the Trump administration to eventually get its house in order. ^ top ^

Chinese FM meets with UN chief, highlighting cooperation on development (Global Times)
Chinese Foreign Minister Wang Yi Friday met with United Nations (UN) Secretary-General Antonio Guterres, with Wang voicing support of the organization and the two agreeing to enhance cooperation on sustainable development and other issues. Wang and Guterres met after they attended a UN Security Council ministerial meeting on the Korean Peninsula nuclear issue. During their meeting, Wang conveyed greetings from the Chinese leaders to Guterres, and said that the new UN chief has brought new vitality, ways of thinking and practical measures to the organization. "China supports UN-centered multilateralism," said Wang, noting that as the most authoritative and credible international body, the United Nations should play a more important role in maintaining global peace and security in the face of the current turbulent situation. Wang said that Chinese President Xi Jinping made a keynote speech at the UN office in Geneva in January on building a community of shared future for mankind, sending a message of win-win cooperation to the world. The Belt and Road Initiative, which aims at promoting the re-balancing of the economic globalization process and building a community of shared future for mankind, has received widespread support from the international community, said Wang. The minister also said China welcomes Guterres to attend the upcoming Belt and Road Forum on International Cooperation to be held in Beijing in May. He meanwhile expressed the hope that "a positive signal of inclusion and win-win cooperation" will be sent from the forum to the world. "We are ready to enhance cooperation with the UN and all parties in implementing the 2030 Sustainable Development Agenda, as well as on climate change responses," he added. Guterres said he is looking forward to attending the Belt and Road forum. China is a firm supporter of the United Nations and multilateralism as well as an advocate of globalization and free trade, the UN chief said, noting that China has played an important role in maintaining global peace, security and prosperity and has made positive contributions to peacekeeping operations. The UN Secretariat has paid great attention to its cooperation with China, said Guterres, adding that the Belt and Road Initiative and the establishment of the Asian Infrastructure Investment Bank mesh with the implementation of the 2030 Sustainable Development Agenda and climate change agreement. He also expressed the hope that China could play a greater role in international affairs. During their meeting, the two also exchanged views on international and regional issues of common concern. ^ top ^

China criticizes US report on religious freedom (Global Times)
China on Friday criticized a US organization's report on religious freedom in the country and asked the organization to discard prejudice. The recent United States Commission on International Religious Freedom (USCIRF) annual report recommended the US government keep China on the list of "countries of particular concern". The Chinese government protects the religious freedom of its citizens in line with laws, Foreign Ministry spokesperson Geng Shuang said at a daily press briefing. "It is obvious and indisputable that the Chinese people of all ethnic groups have fully enjoyed freedom in terms of religious belief," Geng said. USCIRF is politically prejudiced against China, ignores its progress in the area of religion and issues inaccurate reports on its religious policies year after year, Geng said. "The commission should respect the facts, discard its bias and stop interfering in China's internal affairs," he added. ^ top ^


Domestic Policy

Thousands battling Inner Mongolia fire, blaze under control (Xinhua)
Some 8,880 firefighters, including 3,090 forest police, are battling a fire that broke out on Tuesday in north China's Inner Mongolia Autonomous Region. The fire has reportedly spread to 10,000 hectares in the Bilahe Beidahe forest in the Greater Hinggan Mountains on Wednesday. Fire prevention headquarters said the blaze has been mostly brought under control and it had not expanded further as of 3 p.m. However, strong wind and poor visibility have prevented planes from transporting fire fighters and food, and the soldiers have had to walk or take armored vehicles to move around. An initial investigation found the fire was caused by illegal dumping of burning residue by a local furnace worker, who has been detained for further investigation. ^ top ^

China issues regulation on online news service (Xinhua)
Cooperation between Chinese online news service providers and entities with foreign investment should go through a security review, according to a regulation released Tuesday. The regulation, issued by the Cyberspace Administration of China (CAC), requires the online news service providers to abide by the law, promote healthy Internet culture and safeguard national and public interest. The CAC will become the new regulator of online news service, replacing the State Council Information Office. The service providers should put in place a set of information security protocols and measures, such as reviews, checks and emergency responses regarding online news, the CAC said. There should be an editor-in-chief for all online news service providers and their staff should be qualified, according to the regulation. It said that platform operators should protect the privacy of users. The regulation particularly notes the obligations of online news platform operators, whose services would only be available to users who register with their real identities. Online news platform operators that violate the regulation will be punished. In the meantime, another regulation on administrative law-enforcing procedures was also issued by CAC Tuesday, aiming to standardize and safeguard the obligations of online news management departments, so as to properly implement administrative penalties and protect the legal rights of citizens, legal persons and other organizations. The two regulations will go into force on June 1. ^ top ^

Chinese vice premier calls on artists to seek inspiration from grassroots (Xinhua)
Chinese Vice Premier Liu Yandong on Tuesday called on literary and art workers in China to seek inspiration from grassroots and create art works reflecting the trend of the times. Addressing a symposium to mark the 120th birth anniversary of traditional Chinese painter Pan Tianshou, Liu honored Pan's life for his great contribution to the country's art development. Pan, who died in 1971. was also an eminent art educator, theorist and poet, and is well known for his flowers, birds and landscapes in freehand brushwork. Liu, also a member of the Political Bureau of the Communist Party of China Central Committee, called on literary and art workers to learn from Pan's devotion to art education and the spirit of creativity. Officials from the Ministry of Culture, the Chinese Federation of Literary and Art Circles and Zhejiang Province, as well as Pan's relatives attended the symposium. An exhibition of more than 120 works by Pan is on display at the National Art Museum of China. ^ top ^

China Focus: CPC creates four-tier system to measure political discipline (Xinhua)
China's Communist Party of China (CPC) is creating ways to gauge the political soundness of its more than 88 million members, a move experts believe could help the ruling party to maintain a clean political system. The CPC's disciplinary branch released, for the first time earlier this month, nationwide breakdown figures of the "four forms" of discipline supervision and enforcement, first put forward by the branch in 2015 before making their way into regulations on intra-Party supervision in late October. The four forms refer to four levels of punishment and supervision: criticism and self-criticism as well as inquiries through interview or letters should be the most common; minor disciplinary penalties should make up the majority; severely punished or demoted officials should be a small proportion; and those prosecuted for law-breaking should be extremely few. In the first quarter of this year, disciplinary organs nationwide dealt with 179,000 people via the four forms, with 92,000, or 51.7 percent, falling in the first form after being tipped off about breaches of discipline, said the CPC Central Commission for Discipline Inspection (CCDI). People subject to the other three forms accounted for 36.3 percent, 6.4 percent and 5.6 percent of the total respectively. Such data was only made possible after the CCDI put a statistical indicator system into trial use, comprising of 56 indices, at the end of last year. Xin Ming, a professor with the Party School of the CPC Central Committee, said the regular release of the data and other statistics of rules violators could provide an accurate picture for the Party to identify risks, spot loopholes and facilitate solutions in Party governance. Aiming for "green hills and clean water" in political discipline, the CPC has used analogy of managing trees in a forest, saying that the Party must "pluck rotten trees, cure sick trees and straighten crooked trees." "Before the four forms concept was put forward, inspectors only fixed their eyes on a few sick or rotten trees instead of the entire forest," said Jiang Jinquan, a senior CCDI inspector. "Now they are turning their attention to trees in the entire forest." Jiang described the transition from targeting "big tigers" to a comprehensive supervisory and discipline enforcement approach as "an important theoretical innovation." As the battle against corruption has gained crushing momentum, the CPC said it would continue to reduce existing corruption and contain any rise in corruption in 2017, vowing to clear out sources of corruption and establish an effective prevention system. "The first of the four forms is an important embodiment of the CPC's strict governance of the Party," said Xie Chuntao, a professor from the Party School of the CPC Central Committee. "It is expected to dispel the dated distinction between 'good comrades' and 'prisoners' by having a preventative effect, spotting and giving warning to CPC members engaging in petty misconduct at an early stage," he said.  ^ top ^

China to accommodate disabled students to sit gaokao (China Daily)
China has made efforts to accommodate students with disabilities when they take the college admission exam, known as the gaokao. Visually impaired students should be given access to braille or large-font exam papers, according to a regulation issued by the Ministry of Education and China Disabled Persons' Federation Friday. It also stipulated that students with hearing impairments were allowed to be exempt from foreign language listening tests or could have longer time to complete the exams. Disabled examinees are required to submit written applications for such supportive treatment in advance. ^ top ^

Anti-poverty effort wins world's plaudits (China Daily)
Foreign governmental and private representatives lauded China's progress in poverty reduction as the International Department of the Communist Party of China Central Committee hosted an event in Beijing showing how the country has done it. The event, using the example of the CPC Yunnan provincial committee since 2012, attracted about 400 diplomats, foreign politicians and representatives of international organizations on Thursday. "China's tremendous success in lifting the majority of the underprivileged people out of poverty in over a little more than 30 years is a feat that is unparalleled and truly inspiring," said Mark van den Boogaard, senior policy adviser for the United Nations Development Programme. Van den Boogaard, who has recently returned from a research trip to Yunnan, said the country's goal to pull all people out of poverty by 2020 is "ambitious" but "realistic". "From what we have seen in the north of Yunnan, under the leadership of the CPC, the Chinese authorities are clearly on the right track." Van den Boogaard cited the "duel approach" of targeted poverty reduction and intervention on one hand, and the nation's idea of leaving no one behind on the other. Lennart Nilsson, counselor for agricultural affairs with the Swedish embassy, said the figures for China's poverty relief are impressive. "Yunnan province has a fantastic environment. It is also important for the authorities to preserve the ethnic culture and protect the environment during the poverty reduction process," he said. Song Tao, head of the International Department of the CPC Central Committee, said at the event that the CPC is willing to share its experience in poverty reduction with the international community and help its neighbors and developing countries to explore their own ways to eradicate poverty. "Facts have shown that the fundamental strategies by General Secretary Xi Jinping on targeted poverty alleviation are the golden key for China to realize its poverty eradication targets," he said. China lifted 55.6 million people out of poverty between 2013 and 2016. However, more than 40 million still live in poverty, which means that in the coming four years, China would have to pull an average of 10 million people each year out of poverty to reach its target of eradicating poverty by 2020, according to the State Council Leading Group Office of Poverty Alleviation and Development. Chen Hao, secretary of the CPC Yunnan provincial committee, said provincial authorities have prioritized the preservation of the traditional culture of ethnic groups and the protection of the ecology and environmental while reducing poverty. Yunnan's environmental efforts are crucial since it is the source of a number of important national and international rivers, he said. The province has managed to reduce its impoverished population from 8 million in 2012 to 3.6 million in 2016. ^ top ^

Vice premier urges improved rural credit guarantee system (Xinhua)
Chinese Vice Premier Wang Yang called for a better rural credit guarantee system to direct more loans into the money-starved rural economy. Establishing a government-backed system is significant to boosting efficiency of support policies for rural areas and carrying out the agricultural supply-side structural reform, Wang said during a meeting on Friday. To help farmers secure loans, efforts should be made to build more guarantee institutions specializing in rural financing and create new business models, according to Wang. Chinese farmers and agri-businesses have been facing difficulties in borrowing money from banks partly due to the lack of high-quality collateral, and the government is encouraging pilots in rural credit guarantees to solve the problem. Wang urged more cooperation by governments, banks and guarantee institutions. Outstanding agriculture-related loans in China stood at 29.23 trillion yuan (4.24 trillion U.S. dollars) as of the end of the first quarter this year, up 8.9 percent year on year, according to the central bank. The growth was 1.8 percentage points higher than the level a quarter ago.  ^ top ^



Beijing likes shared bicycles-however... (China Daily)
Seeing the boom in the bike-sharing business, along with the resulting clutter created by randomly parked bikes, the Beijing municipal government has published a draft guideline for public comment, the top transport official said on Sunday. Zhou Zhengyu, director of the Beijing Municipal Commission of Transport, said that while the city will control the growing number of shared bikes from different companies, it will not impose a numerical cap. Instead, it will let each district government decide its own limit, taking public needs into consideration, as well as the development needs of the companies. "People in Beijing have accepted the shared bikes well," he said. "This green transportation method has motivated more people to start to ride." Having seen the popularity of the bikes, the authority decided to suspend the expansion of government-backed public rental bikes. "The shared bikes from private companies clearly have advantages compared with the public bikes, even though the frequency of public bike use hasn't been affected much by the shared bikes," Zhou said. Beijing has 86,000 public rental bikes, stationed mainly near subway stations and residential communities, commission figures show. Because the public bikes have immovable racks on which bikes must be locked, many prefer the shared bikes, which can be picked up and parked at the rider's convenience. At present, Beijing has 700,000 shared bikes from companies including ofo, Mobike and Bluegogo. There are about 11 million registered users, equivalent to nearly half of Beijing's population, the commission said. The rapid growth started in August, and has created a few issues, like overcapacity and traffic disorder. Some users leave bikes randomly without obeying the regulations. And some companies put huge numbers of bikes on the street to protect their market share. The Beijing guideline asks each district government to set a maximum number of shared bikes, then provide that to departments responsible for regulating the companies. It also requires companies to use technology to strengthen the management of illegal parking, in addition to ensuring the mechanical safety of the bikes by conducting regular tests. Users who park illegally several times would be blacklisted, and companies would be barred from providing service to anyone on the list. Lin Lei, 30, a regular user of the shared bikes, said he believes a better-regulated industry will raise the satisfaction level of users. "In some places, shared bikes create a mess-piles of bikes-because people just throw them after use," he said. Yin Dafei, chief scientist in Mobike's big-data department, said the company has technology that can predict the parking patterns of shared bikes, which will help it to organize them and raise the company's operation efficiency. ^ top ^



Some CPC members funding Dalai Lama: official (Global Times)
A senior discipline inspection official has lambasted some Party officials for allegedly donating money to the 14th Dalai Lama, saying such behavior severely undermines the Party's fight against separatism. Some Party officials have neglected important political issues and the country's anti-separatist struggle, wrote Wang Yongjun, head of the discipline watchdog in Southwest China's Tibet Autonomous Region. Some have even donated to the 14th Dalai Lama clique, joined illegal underground organizations and provided intelligence to overseas organizations, Wang wrote in an article published on Monday in a magazine run by the Communist Party of China (CPC) Central Commission of Discipline Inspection and the Ministry of Supervision. A few Party officials are failing to "uphold their political integrity" and are "completely ignoring political discipline," Wang added. Such behavior has affected CPC coherence and its ability to fight separatism, he said. China considers the 14th Dalai Lama as a political exile who has attempted to split Tibet from China under the guise of religion. Tibet is firmly against separatism and cracked down on secession and sabotage activities by the Dalai Lama clique in 2016, Qizhala, regional government chairman, said in a speech in March. A 2016 report issued by Tibet's discipline watchdog has linked 15 Party officials to alleged illegal overseas separatist organizations in 2014 who provided intelligence to the Dalai Lama clique and funded secessionist activities, the China News Service reported. ^ top ^



Why the Communist Party has created a new bureau for Xinjiang (SCMP)
The ruling Communist Party of China has created a new bureau to improve intelligence and policy coordination in Xinjiang, the vast western region that has been placed under what many see as increasing police surveillance and intrusive social control. The new bureau for Xinjiang, an area larger than France, Spain and Germany combined in northwest China, has been placed under the Central United Front Work Department, a party organ whose main duty is to court elites outside the party to ensure of their political loyalty. A key function of the bureau is to provide Xinjiang-related advice and policy proposals to China's top leaders. The creation of a new office for Xinjiang reflects Beijing's growing concerns about stability in the region, which borders eight countries from Russia all the way round to India. The office also elevates Xinjiang-related issues on the work agenda of the ruling party to the same rank as non-Communist political parties, ethnic and religious issues, Hong Kong, Macau and Taiwan affairs, and Tibet affairs. The southern part of Xinjiang is predominantly populated by the Turkic-speaking Muslim Uygurs. Members of this ethnic group have been blamed for a string of violent incidents against Han Chinese and government institutions in recent years, which Beijing has labelled terrorist attacks. In one such incident in 2014 in the ancient city of Kashgar, at least 37 civilians and 59 “terrorists” were killed; and in July, 2009, riots in Urumqi, the capital city of Xinjiang, left 197 dead with more than 1,700 injured. The violence in the city was sparked by an incident between Uygur and Han workers at a factory in Shaoguan, Guangdong province that left two Uygurs dead. While Beijing blames separatists and Islamists extremist for the violence, critics argue that China's repressive rule in Xinjiang is the main trigger for the violenc. The government banned men growing long beards and women wearing face veils in many places in Xinjiang. In the latest development, China earlier this year banned dozens of Muslim baby names with religious overtones, including Jihad, Imam, Medina and Mohammed. The new bureau's creation comes at a time when the party is tightening its control in Xinjiang after hardliner Chen Quanguo, the former party secretary of Tibet, was transferred to the region in August last year. A sprawling web of “convenience police stations” has sprung up in cities and rural areas across the region since Chen came to office, covering the region with war-zone style security checks. The stations are equipped with surveillance cameras and guards on 24-hour seamless patrols and can be quickly turned into checkpoints when needed. In the city of Urumqi alone, which covers 340 sq km, is expected to have 949 such stations, according to a website affiliated with the city government. Jiang Zhaoyong, an independent Beijing-based Xinjiang specialist, is sceptical whether the new bureau will be effective in soothing the conflicts in the region. “Implementation of the policies is still largely dependent on the regional chief,” he said. “We should pay closer attention to their moves, as the [United Front Work] department was seldom involved in Xinjiang affairs.” Since President Xi Jinping came to power 41/2 years ago, he has been giving the party a more prominent role in managing key political, economic and social affairs, and the creation of a new bureau in the party's united front work office fits the broad shift of decision-making power away from government towards the party. The department, with a mission of “uniting all groups that can be united” to help Communist Party rule in China, created a new bureau last year to reach out to what the party referred to as the “new social class”of private business executives and professionals. ^ top ^

Party sets up special bureau for Xinjiang (Global Times)
The Communist Party of China Central Committee's United Front Work Department has set up a new bureau for Northwest China's Xinjiang Uyghur Autonomous Region, the department said Thursday. The new bureau is primarily in charge of analyzing Xinjiang's situation and policies, and will assist in coordinating and supervising the implementation of the central government's decisions on the region, according to statement released on the department's WeChat account on Thursday. Specifically, the bureau will conduct research on significant and sensitive issues and policies in the region, as well as recommend solutions. The bureau is also in charge of coordinating between Xinjiang and other areas in China on issues affecting social stability, ethnic unity, ideology, economic development, education and employment, the statement said. The department previously has eight bureaus, one of which is responsible for ethnic and religious affairs. Work involving Xinjiang is of special importance to China, and the region's development and stability is vital to the country's reform and stability, the statement said. In March, Chinese President Xi Jinping said that the "great wall of iron" to safeguard national unity, ethnic solidarity and social stability should be fortified in Xinjiang. Xi also called for safeguarding ethnic unity and reinforcing solidarity between the military and the government, soldiers and civilians, police and the public, as well as between the Xinjiang Production and Construction Corps. ^ top ^

Drones will help Xinjiang fight terror (China Daily)
The Xinjiang Uygur autonomous region plans to deploy drones to patrol its borders as it further tightens security this year, a senior official said. "Xinjiang will deploy drones, set up barbed wire and install surveillance cameras along the border to prevent people crossing the border illegally," Jerla Isamudin, deputy chairman of the region, said in an interview. Xinjiang needs to further enhance cooperation in exchanging terrorism-related intelligence with neighboring countries, he said. The region has been working on connecting People's Liberation Army border control units to the power grids since 2014 to provide an efficient electrical supply to high-tech equipment. In 2017, 29 more frontier defense companies in Xinjiang will have electricity and will not have to rely on unstable solar energy and diesel generators, PLA Daily reported in March. Northwest China's Xinjiang neighbors eight countries, including Pakistan and Afghanistan, and it has a border of more than 5,600 kilometers. It has been China's main battleground in the fight against terrorism. Many terrorists who carried out attacks in the region in recent years received training abroad and then entered illegally, and some also fled across the border, according to the regional police authority. Chinese authorities believe the penetration of religious extremism from abroad has prompted people to carry out violent attacks in Xinjiang and other parts of the country in recent years. Shohrat Zakir, the region's chairman, said in January that Xinjiang would impose tighter entry-exit measures in 2017. In 2016, the regional legislature passed a regulation on border control, which took effect in December. The regulation requires people living along border areas to report strangers to public security authorities within 24 hours. Also, those who damage surveillance equipment along the borders will be punished in accordance with the regulation. Nayim Yassen, director of the Xinjiang People's Congress Standing Committee, the regional legislature, said the committee will examine the works on border control and give suggestions for improvements later this year. Xinjiang sees keeping the region stable as a priority. Chen Quanguo, the region's Party chief, has said the local security situation is an important index in evaluating officials. ^ top ^



Hong Kong lawyers head urges Beijing to listen and not rush Basic Law interpretation (SCMP)
The Law Society has urged Beijing to grant more channels for Hongkongers to convey their views on legal issues before making any interpretation of the city's mini-constitution, describing previous instances as too “rushed”. The lawyers made the appeal as some Beijing legal advisers have suggested the country's top legislative body should devise a mechanism for interpreting the Basic Law, sparking concerns that the mainland would deepen its involvement in the local legal system and hurt “one country, two systems”. Society president Thomas So Shiu-tsung said he led a delegation to Beijing last week to meet the Ministry of Justice, the State Council's Hong Kong and Macau Affairs Office, All China Lawyers' Association, the Basic Law Committee and the Supreme People's Court. “We feel that the past [interpretation] process appeared a bit rushed,” So said. “If possible, maybe it's better for Hongkongers to have advance notice of the fact that the National People's Congress Standing Committee is to discuss an interpretation.” Article 158 of the Basic Law states the Hong Kong courts can seek an interpretation from the Standing Committee, the country's top legislative body, over affairs that are the responsibility of the central government or concerning its relationship with Hong Kong. The committee has interpreted different clauses in the Basic Law five times since the handover. Only one of them arose from a court request. The rest were either initiated by the Hong Kong government or Beijing. The last one – made last year – pre-empted a Hong Kong court's judgment over a case involving two pro-independence lawmakers, and effectively disqualified them for their anti-China antics during the swearing-in. The legal sector held a silent march to protest the interpretation, saying the case should have been resolved within local courts and claiming the Beijing ruling dealt a blow to the rule of law. So said the society did not make specific proposals, but asked the Standing Committee to make its deliberation process more transparent “so that stakeholders may have time to express their views and the committee will be able to capture a lot more information from the community”. At present, the Standing Committee only consults the 12-member Basic Law Committee, comprising mostly pro-establishment scholars and lawyers from the mainland and Hong Kong, for interpretation matters. Basic Law Committee member Rao Geping said last week a mechanism should exist to stipulate the principle for interpretations as well as the procedures, legal effect and relationship with Hong Kong courts. Meanwhile, former society president Huen Wong said he “was not interested” in becoming the city's next justice secretary when asked to respond to speculation that he had been approached by chief executive-elect Carrie Lam Cheng Yuet-ngor. Wong said no one “directly” approached him but there had been talks “through third parties”. ^ top ^

China slams US hearing on HK affairs (Global Times)
China said Thursday it strongly opposes a US congressional hearing over the situation in Hong Kong, saying the hearing "constitutes a blatant interference in China's internal affairs." The US Congressional-Executive Commission on China conducted a hearing called "Will the Hong Kong model survive? An assessment 20 years after the handover" on Wednesday. "Defying facts and driven by ulterior motives, the commission claimed that the practice of 'one country, two systems' in Hong Kong has eroded, and press freedom and judicial independence is threatened," Chinese foreign ministry spokesperson Geng Shuang said at a daily briefing on Thursday. "The so-called commission is always biased against China," Geng added. "One country, two systems, Hong Kong people administering Hong Kong and a high degree of autonomy have been earnestly implemented since the return of Hong Kong 20 years ago," Geng said, adding that "it is an undeniable fact for all those without prejudice." Lam Cheng Yuet-ngor, the incoming Chief Executive of the Hong Kong Special Administrative Region, hailed the implementation of the "one country, two systems" principle in Hong Kong over the past 20 years as a success during an interview with the Xinhua News Agency and the China Central Television in April. She also vowed to lead the region in accordance with the Basic Law to ensure the "one country, two systems" principle is implemented without any distortion. Meanwhile, Geng noted that the hearing constitutes a blatant interference in China's internal affairs, including Hong Kong affairs. "Hong Kong is a special administrative region of China, and Hong Kong affairs fall within China's internal affairs. We are firmly opposed to any country's interference in Hong Kong affairs in any form." "The attempts of some individuals in Hong Kong to collude with foreign forces in meddling in Hong Kong affairs will never succeed," he added. A spokesperson for the Office of the Commissioner of the Ministry of Foreign Affairs in Hong Kong also denounced the hearing on Thursday, saying it "grossly meddled in Hong Kong affairs." This year marks the 20th anniversary of Hong Kong's return to the motherland, with several events being held in Hong Kong and the mainland. ^ top ^



China conditionally approves Dow-DuPont merger (Xinhua)
China has decided to greenlight the merger of chemical giants Dow Chemical and DuPont after nearly a year of antitrust investigations, but asked the two to divest some businesses as preconditions of the approval. The Ministry of Commerce said Tuesday in a statement that the merger will boost their market shares for some chemicals and limit competition in the Chinese market and beyond. The two companies' dominance in pesticides, weed killer and several other products will likely increase after the consolidation of their marketing power and R&D division, which will dampen the rise of competitors, negatively impact technological advancement, and hurt downstream dealers. The ministry believes the post-merger conglomerate will control nearly 40 percent of China's weed killer market, 75 percent for acid copolymers and 100 percent for ionomers. The proportions are similar globally. Businesses, assets and R&D facilities of those products should be divested, and the new company should ensure supply in reasonable prices in China in the next five years, according to the statement. The Dow-DuPont merger was also approved by the European Union on similar conditions in March. In a press release last week, Dow said it plans to start spin-offs within 18 months of the closing of the merger in August, with the Material Science Company the first to be separated. Announced at the end of 2015, the merger will create a new chemical giant worth up to approximately 130 billion U.S. dollars with three independent, publicly traded companies. Dow and DuPont shareholders will each own about 50 percent of the shares. Partly buoyed by the merger, Dow's global sales increased 23 percent year on year to 13.2 billion U.S. dollars in the first quarter of the year, with China as its fastest-growing market followed by the United States and Europe. The company highlighted China's role in its business expansion for now and in the future. "China's transition to a consumption economy focused on domestic growth is progressing on a stable path, with strong growth drivers especially for Dow's products," said Andrew Liveris, Dow's chairman and CEO. ^ top ^



KCNA critique won't ease mounting nuke tension (Global Times)
The Korean Central News Agency (KCNA) released a bylined editorial titled "Refrain from making reckless remarks undermining the DPRK-China relations" Wednesday night (Beijing time), slamming Chinese media by name for running articles North Korean officials felt constituted "a wanton violation of the independent and legitimate rights, dignity and supreme interests" of North Korea. This is the third time in recent months the KCNA has published a bylined editorial critical of China. Unlike the first two pieces that did not mention China or any names of Chinese media outlets, this latest one did. The KCNA piece defended North Korea's nuclear program. It also refuted Chinese media allegations over the threat of safety from nuclear tests being conducted in close proximity to northeastern China as having no scientific merit. The reasons given in the editorial include the previous five nuclear tests that have had no impact on North Koreans living close to the nuclear test site, and how the US has detected no radiation pollution, even with the most advanced tools. The editorial also lashed out at whom it called "some ignorant politicians and media persons" in China over their views on how North Korean nuclear actions have "posed a threat" to the national interest of China. "It is just the DPRK whose strategic interests have been repeatedly violated due to insincerity and betrayal on the part of its partner, not China at all," it claimed. The article went on to criticize how the diplomatic relationship between China and South Korea has turned northeastern China, and even China as a whole, into an anti-DPRK environment. The piece claimed that the northeast has become rife with South Koreans engaging in threatening activities such as kidnapping and terrorism against North Korea. The article was also critical of the time China invited then-South Korean president Park Geun-hye to attend the 2015 military parade at Tiananmen Square. The KCNA editorial made it a point to stress how North Korea has been standing on the front lines of the war against the US for a long time. “China should acknowledge in an honest manner that the DPRK has just contributed to protecting peace and security of China, foiling the US scheme for aggression by waging a hard fight in the frontline of the showdown with the US for more than seven decades, and thank the DPRK for it," the editorial claimed. The piece then concluded with, "China had better ponder over the grave consequences to be entailed by its reckless act of chopping down the pillar of the DPRK-China relations." The KCNA opinion piece contains no new substantive information, except mentioning the names of China, People's Daily, and Global Times and expressing a stronger disgruntling. It did not mention China's support for the United Nations sanctions against North Korea. Nor did it state Pyongyang's next step to take. Overall, the editorial is nothing more than a hyper-aggressive piece completely filled with nationalistic passion. Pyongyang obviously is grappling with some form of irrational logic over its nuclear program. Beijing does not need to engage in a tit-for-tat argument with Pyongyang. However, it should express its own opinions regardless of what Pyongyang has said. Beijing needs to make China's standing and position very clear to Pyongyang, either on an official or grassroots level. It needs to address with Pyongyang its concerns and bottom line. It should also make Pyongyang aware that it will react in unprecedented fashion if Pyongyang conducts another nuclear test. Beijing should not hesitate in delivering this message, and there is certainly no need to debate this issue back and forth with Pyongyang. The differences and contradictions between China and North Korea will not be solved through any sort of argumentative effort. Beijing can see from the KCNA editorial that Pyongyang does not understand the real meaning of "national interest" when it comes to the big picture of Chinese diplomacy. Nor does it understand Beijing's deep concern for the potential risks posed by Pyongyang's nuclear tests to people living in northeastern China. It is also evident from the KCNA editorial that Pyongyang's criticisms reveal the true feelings it has over its position as an isolated environment. It is mainly due to this last point that any attempt North Korea makes in voicing opinions and feelings through media outlets will have limited effect in helping the country understand outside opinions from the rest of the world regarding its nuclear program. Beijing and Pyongyang need to pursue higher levels of dialogue with one another. It is only through such efforts that Pyongyang can be pulled out of the blind ally it insists on remaining in, especially when the country considers nuclear weapons "as precious as its own life," as it put in the article. It really does not matter that much when Pyongyang publicly voices its criticisms of Beijing. What really matters is what will Pyongyang's next move be. As of right now, Pyongyang has not conducted its sixth nuclear test. It was also comparatively restrained when it launched intercontinental ballistic missiles in April. In this current situation, uncertainties loom over the positions of North Korea and the US. Beijing needs to be fully aware of what those positions are, and then seek to help both parties resolve this ongoing security dilemma. China's proposed "double suspension” seeks to assist in US efforts to get the related parties back to the negotiation table. The direction of China-North Korea relations remains in the hands of China. Whether KCNA editorials mention China or Chinese media by name or not, those missions will not change the inherent logic and trend of a relationship that has been in place for over six decades. The more editorials KCNA publishes, the better Chinese society will be able to understand how Pyongyang thinks, and how hard it is to solve this nuclear issue. ^ top ^

Tillerson says US must test China on North Korea, by 'leaning in hard' on Xi Jinping (SCMP)
US Secretary of State Rex Tillerson laid out his plans Wednesday for tackling world issues including the standoff with North Korea, saying the US should test China by “leaning in hard” on President Xi Jinping to curtail Pyongyang's activities. Three months after taking over the State Department, Washington's top diplomat gave a wide-ranging pep talk to his staff around the globe on the work ahead. In his budget proposal, US President Donald Trump has proposed slashing the US foreign relations and aid budget by more than a quarter. But Tillerson reassured his audience that they would be consulted on plans to restructure the department even as they work together on the key challenges. North Korea's efforts to develop an arsenal of nuclear-armed missiles capable of reaching US cities were the “greatest threat” faced by the United States, he said. Tillerson told the diplomats that he had advised Trump to “test” China's commitment to reining in its neighbour by “leaning in hard” on Preident Xi. If Beijing failed to enforce existing UN sanctions, he warned, then Washington could take action against Chinese banks or companies that deal with Pyongyang. “So it's a pressure campaign that has a knob on it. I'd say we're at about dial setting 5 or 6 right now,” he said, without saying how high the dial goes. “I would say we're at about the 20 to 25 per cent stage of this strategy... but we've got a lot of work left to do to keep that pressure on.” China's role in North Korea may be the most pressing issue, but Tillerson said he sensed an opening to reset the basis of China-US ties for the next 50 years. Trump and Xi, the leaders of the world's two biggest powers, met last month in Florida and Tillerson said he wanted the bilateral dialogue to intensify. Differences remain over freedom of navigation in waters claimed by China in the South China Sea and the trans-Pacific trade imbalance. But Tillerson said ties were at a “point of inflection” and ripe for review. “Let's kind of revisit this relationship, and what is it going to be over the next half century. “I think it's a tremendous opportunity we have to define that, and there seems to be a great interest on the part of the Chinese leadership to do that as well.” Before North Korea's latest weapons tests, Trump had made the battle to eradicate “radical Islamic terrorism the focus of his foreign policy. It remains a key goal, and Tillerson said the State Department would be part of the effort. He described the threat as emanating in “concentric circles” from the battlefields of Iraq and Syria through the Middle East to Africa and Central Asia. “So a lot of work ahead of us,” he said, underlining that the battle is central to policy in the region. “Many of you are directly engaged in it already. Many more of you are going to become engaged in it, I think you can expect.” In his former job as CEO of energy giant ExxonMobil, Tillerson was a frequent visitor to Russia pursuing oil deals with President Vladimir Putin's Kremlin. Russia clearly hoped that Trump's election victory and Tillerson's appointment would lead to warmer ties with Washington - that has not happened. Tillerson told his colleagues that, on a visit to Moscow last month, he had told Putin that relations are as bad as they have been since the Cold War. “He did not disagree. He shrugged his shoulders and nodded in agreement,” Tillerson said. Washington hopes to work with Russia to develop ceasefire zones in Syria, but the former foes are still divided over Russia's intervention in Ukraine. So the secretary, who meets Russia's Foreign Minister Sergei Lavrov in Alaska next week, said he would work on “some small things” to build a level of trust. “So that's what we're hoping, is that we can begin to build a way in which we can learn how to work with one another. I don't know whether we can or not,” he said. Tillerson cited work in Africa to alleviate health crises and disrupt terror networks, and in Latin America to combat trafficking and extremist finance. But his list of priorities included no reference to Europe, beyond repeating Trump's call for Nato members to spend more on collective defence. ^ top ^

China, US discuss tougher UN response to North Korea missile programme (SCMP)
The United States is negotiating with China on a possible stronger United Nations Security Council response, such as sanctions, to North Korea's escalating threats of nuclear development, diplomats said on Wednesday. The possibility of a tougher line on North Korea comes as US President Donald Trump steps up military and political pressure against the reclusive regime. Chinese analysts said Beijing, which has long been a guarantor of Pyongyang's security and economy, was also recalibrating its policy towards its wayward ally. North Korea is on a mission to develop a long-range missile ¬capable of hitting the US mainland with a nuclear warhead, and has so far staged five nuclear tests, two of them last year. The most recent test, which failed, was on Friday and followed a UN Security Council meeting on North Korea chaired by US Secretary of State Rex Tillerson and attended by Chinese Foreign Minister Wang Yi. During the meeting, Tillerson called on states to sever diplomatic and financial ties with Pyongyang and suspend the flow of North Korean guest workers. Zhang Liangui, professor of international strategic research at the Communist Party's Central Party School, said Chinese President Xi ¬Jinping and Trump agreed last month that the situation required immediate attention, and China was more likely than ever to endorse a new United Nations resolution on North Korea. “From the signals sent out by [Beijing] officials and the increase in domestic discussion about the possibility of sanctions, it is likely that China has adopted a new attitude towards North Korea and may adjust its policy,” Zhang said. Traditionally, the US and China have got together to negotiate new sanctions before involving other Security Council members. UN diplomats said the ongoing talks were still just between Washington and Beijing. At a minimum, the US could push China to agree to condemn North Korea's missile launches in a resolution, instead of a statement, which may also blacklist more people and entities tied to Pyongyang's missile programme. It was not immediately clear how open Beijing might be to new sanctions. The Security Council has boosted sanctions in ¬response to North Korea's five ¬nuclear tests and two long-range rocket launches. Meanwhile, satellite images indicated activity had resumed at North Korea's nuclear test site at Punggye-ri, Agence France-Presse reported, citing US-based monitoring group 38 North. Li Dunqiu, from Zhejiang University, said the bottom line for China would be to stop North Korea from conducting a sixth ¬nuclear test. If Pyongyang crossed that line, further curbs on trade and smuggling could be considered, Li said ^ top ^

Russia backs China's "double suspension" proposal on Korean Peninsula (Global Times)
Russia backs China's proposal on the suspension of missile and nuclear tests by the Democratic People's Republic of Korea (DPRK) and of joint military drills by the United States and South Korea at the UN Security Council, the Russian Foreign Ministry said Saturday. "During a broad discussion, members of the council (UNSC) unanimously called upon the DPRK to renounce missile and nuclear tests and implement relevant UNSC resolutions," the ministry said in a statement following an open ministerial meeting on the Korean Peninsula nuclear issue held by the UNSC Friday. The UNSC also called for "a political and diplomatic solution" to the issue during the meeting, the statement added. "In this context, the Russian Federation supports China's proposal for a 'double suspension' (the suspension of Pyongyang's missile and nuclear tests in exchange for the suspension of US-South Korean military drills near the DPRK) as a starting point for political negotiations," the ministry said. Nevertheless, no common solution was made at Friday's meeting, according to the statement. Last month, Chinese Foreign Minister Wang Yi said China proposed a dual-track approach of denuclearizing the Korean Peninsula, namely the "double suspension" initiative, in an attempt to help the parties break out of the current security dilemma and return to the negotiating table. ^ top ^



Jason Allford: IMF and WB are ready if Parliament makes its decision certain (Montsame)
Today, May 04,Head of Cabinet Secretariat, Minister J.Munkhbat met with the World Bank representatives, headed by Jason Allford, the Executive Director of the World Bank Group representing Mongolia and some other countries. Minister J.Munkhbat noted that protecting investors' rights in legal frame is one of the priorities of the Government and a council in charge of protecting investors' rights was established by an order of Prime Minister. He expressed his thanks to the World Bank for granting financial support within the IMF program to Mongolia. Mr Jason Allford said “- We know that economic conditions were tough when you took power. We are also happy that the economy tends to revive. It would be a good example to other countries that the Government of Mongolia has established a certain structure for the protection of investors' rights at a policy level. Mongolia needs to increase foreign investment to overcome its economic difficulties. However, restriction of the investors' transaction, making it to pass only through Mongolian banks has much negative impact on the economy”. Asking whether parliament is reconsidering its decision concerning the matter he said that if parliament makes its decision certain, IMF and WB are ready to conclude their decision within a short period. “- The majority group in parliament has made its political decision to reconsider and change the parliamentary resolution, which regulates income from some big projects to pass through Mongolian banks. Within this week, the parliament will finalize it. After that, we believe the IMF will confirm its official decision on implementing its program in Mongolia” said Minister J.Munkhbat. He also emphasized Mongolia's active collaboration with IMF and WB and high expectations, including positive effects to economy as a result of the cooperation this time too. ^ top ^

76.8 percent of Mongolian land suffers from desertification (Montsame)
According to the Report on Environmental State For 2015-2016, 76.8 percent of the Mongolian territory has been struck by desertification as a consequence of fast-spreading dryness in the recent years. The report was presented by Minister of Environment and Tourism, Ms D.Oyunkhorol at a cabinet meeting. The main cause of desertification was the 2.5 times increase in the population of livestock since 1990 and failure to maintain the traditional methods of pasture rotation and going on search for better grazing lands, says the report. Another concern is the increased frequency of atmospheric hazards. In specific, average of 30 atmospheric incidents were observed each year from 1990 and 2000, whereas the number had doubled between 2001 and 2016. For instance, the number of days with dust storms went up to 47 in 2015 from 37 in 2014. Although Mongolia's total carbon dioxide emission is lower than the global average, 6.08 metric tons of CO2 emission per capita indicates a number that is quite higher than the global average. Climate change, pastoral degradation and improper mining activities have speeded up the drying process of surface waters – springs, rivers, ponds and lakes. According to results of 2016 centralized census of surface water, a total of 774 springs, 263 small and large rivers and 346 lakes have dried out. Moreover, 88 percent of the soil samples from Ulaanbaatar used in the soil test conducted in 2014 were tested positive with various bacteria, mould and fungus, as well as ammonia contamination in densely populated areas. Waste water coming from the central sewerage and industrial waste have contributed to Tuul River pollution. Report reads that contents of nitrate azote and rock phosphate at the river's influx have tendency to increase since 1985.  ^ top ^

The race for the presidency has begun (UB Post)
Political parties with seats in Parliament, namely the Mongolian People's Party (MPP), Democratic Party (DP), and Mongolian People's Revolutionary Party (MPRP), are approaching the deadline to announce which of their party members will be running in the upcoming presidential election. The DP carried out candidate registration for the presidential election on May 2. Member of Parliament L.Bold, former Prime Minister R.Amarjargal, former Minister of Justice and Internal Affairs D.Dorligjav, former Prime Minister N.Altankhuyag, former Agriculture Minister Kh.Battulga, and former Minister of Industry B.Jargalsaikhan have registered to run for the party's nomination. The DP and MPP will carry out candidate selections for their candidates on May 3. The DP has made the decision to select its presidential candidate through votes from all members of the party. The candidate who wins the majority of votes from DP members will be officially announced as the party's presidential candidate during the Democratic Party's Eighth Congress, which will be held this week. Analysts say that Speaker of Parliament M.Enkhbold will be representing the MPP in this presidential election. The MPP has not carried out its presidential candidate registration, but it will be clear who the MPP candidate will be after today's meeting of the party's members. N.Enkhbayar, the third President of Mongolia, wants to run in this election and intended to announce his intention to run in a press conference yesterday that was ultimately canceled. The MPRP is unable to nominate N.Enkhbayar because he has no constitutional right to run for president due to his criminal record and because he lived abroad for more than six months of the past five years. The former president asked the Sukhbaatar District Court to suspend his sentence to give him an opportunity to run in the presidential election, but the court did not give him an official response. There have been recent rumors in the press and on social media that the MPRP will nominate former Minister of Foreign Affairs L.Erdenechuluun to represent the party in the election, but his nomination has not been confirmed. According to the Law on Elections, the Mongolian General Election Commission (MGEC) is eligible to register candidates from May 2 to May 6. Authorities in charge of state registration report that they received registered voter information on May 2 in preparation for the upcoming presidential election. Candidates who qualify to run in the election will receive candidacy certificates from the MGEC on May 27, and lists of registered voters will be dispatched to election committees in districts, provinces, and soums on June 1. Election campaigns will be carried out from June 6 to June 25, and overseas voting will take place on June 10 and 11 for Mongolian citizens living abroad. The presidential election will take place nationwide on June 26. ^ top ^

Neil Saker: IMF will move ahead the program within coming weeks (gogo Mongolia)
Neil Saker, IMF`s resident representative in Ulaanbaatar held a press session today. He talked about the IMF-supported program that worked closely with Government of Mongolia. "The program is in two main components. One is the stabilization of the current problems. The second one is laying the policies for long-term economic growth. I would say that we are very optimistic about Mongolia`s longer term future. We have worked closely with the Government and especially with the Ministry of Finance and the Bank of Mongolia on devising policies that will restore stability and lay the foundations for growth in the future. The key parts of the program are reducing fiscal deficits, stabilizing the debt and strengthening the banking system. All these measures will allow interest rates to fall over time and for the banks to start lending again to support growth. At the core of the program is a fiscal adjustment. This is absolutely necessary because the deficit last year was 17% and that`s far too high and that`s leading debt to be very high. Mongolia is now paying very high amounts in interest payments when it could be spending that money on health, education and social programs. So we fully support the Government`s fiscal adjustment path that cuts the deficit from 17 percent last year to around about 10 and a half riskier and then aiming for a balanced budget by the early 2020s. We worked very closely with the Government officials on the policies and the numbers that would underline this fiscal adjustment. The most of the adjustment is on the expenditure side. Most on expenditure are cutting capital projects. I think the framework for appraising which projects should go ahead will be strengthened. So there is space for cutting back some of these projects. We also measure on cutting current spending including the size of the public sector through natural attrition. “ The revenue measures, almost all of them aimed at the richer people in Mongolia and the poorer people will see no real tax increases at all. ” Two third of the fiscal adjustment is on the expenditure side and one-third is on the revenue side. But is also very important to note that for reasons of fairness and equity. We agreed that no cuts would be made to social spending and the revenue measures would be more protected the poorest people. The revenue measures, almost all of them aimed at the richer people in Mongolia and the poorer people will see no real tax increases at all. It is very important to note that VAT has not been increased. It is being kept up at the current level. Then on income tax, a number of new tax rates have been introduced about these will the higher tax rates will only come in for those people who earn very high-income levels. So the average person will not see any increase in income tax. The type of system is now what we call as a progressive tax system is found in every country in the world. It is very unusual for the country to have separate taxation system. All the tax increases and the expenditure measures were fully discussed and agreed with the government officials and we can say that the program is a joint program and has taken on the best advice from all parties. We are very optimistic that the program will succeed in stabilizing the situation and the benefits of it will be that the exchange rate will become much more stable, inflation will be low and interest rates will fall and the banks will become stronger. Because they will support the economic recovery with loans particularly to the SMEs. Successful implementation of the program will allow Mongolia to attain its very strong potential. We see growth at around 8 percent in the medium term and that will be very good for raising living standards into the future".
Following his speech, he answered the questions.
Last week`s Board meeting delayed Mongolia`s request due to the provision of the Parliament resolution. Board of IMF said that they need time to assess the situation. When can we expect the IMF to complete its review of the resolution?
We are very optimistic that this issue will be resolved and we can move ahead with the program hopefully within coming weeks.
It seems like the MPP caucus has agreed to make changes to the resolution but we believe that this clause covers other issues not related to the investment contract?
I am not aware of that.
Regarding the tax increases, the Finance Minister said that it was the joint decision of the Government of Mongolia and IMF. However, IMF resident representative also said that the IMF did not push for this kind of tax increases. So which party is saying the truth?
I think we have already said that the program is a joint program. It was agreed at the technical level by our staff and the Government staff and at the policy level. We fully support Government`s actions.
This clause having the FDI money going through the domestic banks is not really specific from Mongolia and many other countries who have require these conditions but Mongolia made a mistake when didn`t cover this issue in its investment contract with Rio Tinto. So why the IMF is not going against Rio Tinto for putting this kind of complaints?
We have no particular views or issues at in terms of corporate disputes so we`re not involved in that at all. Our main issue is on the longer term growth outlook and that means the business environment and the investment climate needs to be very good to attract the foreign investors. We hope that Mongolia will have one of the best investment climates in the world and that will attract investment and that will support sustainable economic growth.
You said that tax increases mostly focused on more on the wealthier people. However, there is a possibility to increase the taxes on gold producers and there are a number of initiatives to increase it. Why didn`t you recommend increasing this kind of taxes? Because lots of minerals are exported without paying taxes.
I think one issue there is the higher tax on gold for less incentive there is for the gold producers to declare their output. In the past, I think those was issues we had. By having more competitive tax rate seems to have led to much more gold production and increases in the royalties to the Government. We also note that the mineral prices have increased quite a bit in recent months and that has been very positive increasing revenues for the Government.
What is the IMF position regarding the specific clause of the Parliament resolution? Does it have to be removed or changed?
As I said, we are looking implications of the clause and assessing the impact at the macroeconomic level. My colleagues are doing at the moment so I can`t be a savior or anything on that. ^ top ^

IMF delays Mongolia's request on Extended Fund Facility Program (gogo Mongolia)
The board of International Monetary Fund held a meeting on Apr 28th. However, IMF delayed Mongolia`s request on Extended Fund Facility Program. IMF office in Mongolia explained that it was delayed due to the Parliament`s resolution linked to the approval of state budget 2017 which states major companies such as Oyu Tolgoi LLC to transfer their all payments and transactions through banks only operating in Mongolia. IMF noted to consider Mongolia`s request after studying the resolution whether it violated the law on investment and harmful to investors. Delegations led by the Minister of Finance B.Choijilsuren, the President of Bank of Mongolia N.Bayartsaihan attended IMF`s spring meeting that was held in Washington DC, USA on Apr 18th. At the meeting, Mongolian delegations met Managing Director of IMF Ms. Christine Lagarde and World Bank Group President Jim Kim and introduced Mongolia's socio-economic situation as well as expressed Mongolia`s request on Extended Fund Facility Program. Meanwhile, they have given the recommendation to review the resolution approved by the Parliament. Delay of the IMF`s Extended Fund Facility Program may draw back the large loans that will be granted from the World Bank, Japanese Government and the Asian Development Bank. ^ top ^

Television stations protest proposed limitations on free speech (The UB Post)
On Wednesday, a number of Mongolian television stations abandoned their regular programming to broadcast a message that read “People's right to know is under major threat”, and all daily newspapers published this message on their front pages. The message was shared in response to proposed articles in a bill on misdemeanors. During a meeting of the Standing Committee on Law held on Tuesday, an initial review of the proposed legislation was carried out. The bill, dubbed by some as the Law on Conflict, includes the following proposals for new legislation and penalties for misdemeanors: 1. Individuals who are found guilty of defamation on Facebook, Twitter, and other media channels will be fined 10 million MNT, and an enterprise found guilty of defamation will be fined 100 million MNT. 2. Doctors in violation of their legal responsibilities will be responsible for the financial compensation of damages to victims and fined one million MNT. Hospitals in violation of professional ethics will be suspended from offering medical services for one year. 3. Medical facilities that suspend the provision of emergency medical and maternity care will be responsible for the financial compensation of damages to victims, their operations will be suspended for one year, and penalties of 200,000 MNT for individuals and 2 million MNT for enterprises will be applied. 4. Individuals and enterprises improperly disposing of waste will be responsible for the financial compensation of damages, and charges of 30,000 MNT for individuals and 300,000 MNT for enterprises will be applied. 5. An individual who spits or litters in a public space will be fined 10,000 MNT. 6. A person illegally possessing a knife or other weapons without a proper license will be fined 25,000 MNT and their weapons will be seized. 7. A person who fails to report domestic violence will be fined 50,000 MNT. 8. An individual responsible for a loud noise complaint in the evening in a residential area will be fined 100,000 MNT, and enterprises will be charged one million MNT. 9. A person who establishes and operates a gambling venue will be charged a fine of two million MNT and enterprises will be fined 20 million MNT. 10. Individuals and enterprises organizing a rally without a legal permit, or changing the purpose of a permitted rally without permission, will be made responsible for financial compensation for damages. An individual will be charged 150,000 MNT and enterprises will be fined 1.5 million MNT. 11. Individuals and enterprises will be responsible for financial compensation for damages from burning trash; an individual will be fined 50,000 MNT and enterprises will be fined 500,000 MNT. ^ top ^


Ms. Corinne Estermann
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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