Sinocism China Newsletter For 08.27.12

In another sign of worry about the flagging economy, Premier Wen Jiabao visited Guangdong Friday and Saturday and urged targeted, effective efforts to stabilize export growth (千方百计稳定外需 努力实现稳增长目标–温家宝总理在广东考察  – 新华网). Bloomberg’s report on his visit (Wen Says China Need Measures to Promote Export Growth) emphasizes that his tour was more about confidence building than practical measures:

“The most important thing right now and the purpose of Wen’s trips is to reboot the confidence of businesses and focus more on employment,” said Helen Qiao, chief China economist with Morgan Stanley in Hong Kong. “We’ve seen a significant deterioration in exports and the government really has very few tools to stimulate external demand, but it’s an important gesture that the government shows it’s trying to help.”….“A depreciation could trigger more trade protectionism and could backfire,” said Qiao. “With the transition to a new leadership in China and a U.S. presidential election this year, this would be the last possible option to consider. The most they can do is stay put.”

Many people are hoping that the new leadership that emerges from the 18th Party Congress will push forward more economic reform. Reuters quotes one hopeful analyst in Politics the priority for China as economy slows:

Tim Condon, head of Asian economic research at ING in Singapore, question calls for tactical action ahead of the transition. He says something more strategic may be at play…”A bad year is not the end of the world for the Party. The new leaders come in, turn things around in 2013 and look like heroes,” Condon said, adding that aggressive stimulus would thwart policies to fight speculation and rebalance the economy…. “What they seem to be saying is that they are not going to take the easy way and double down on the command and control policies, but stay on the course of market-oriented reform,” Condon said. “That’s a really positive story – if it’s true.”

There are suddenly lots of people on the Beijing streets with red armbands, and more than one said they are out to help with 18th Party Congress security. Perhaps the 7th Plenum of the 17th Party Congress and the opening of the 18th Party Congress are closer than we think? That would be very good news and while reforms, assuming they are on the agenda, would take a while to push through and have an impact, the Chinese stock markets might view an early Congress as a positive.

One emerging bright spot for US-China trade (and for audiences) has been the increase in US films showing in China. That may change, as an official with the State Administration of Radio, Film and Television (SARFT) has called for an investigation into the US-China “co-productions” that allow China market for US films and provide a higher revenue share for the producers. China Daily has a brief item on the official’s comments in Time for ‘Action!’ on co-produced films, but the original Chinese (广电总局将严查中美合拍片 称威胁国产片市场_腾讯网) is much harsher and should worry any film investor assuming their project has an in to the China market because it will be labeled a “co-production”.

China is already concerned about a Mitt Romney presidency, and recently the Romney campaign’s foreign and national security policy director Alex Wong told the Liberty Times that if elected he would try to sell F-16C/D fighter jets to Taiwan.

In a his latest Foreign Affairs piece Aaron Friedberg, co-chair, Asia Pacific on Mitt Romney’s foreign policy and national security advisory team, wrote:

“Meanwhile, with other countries less likely to see China as a threat, Beijing would find it easier to reach mutually acceptable settlements with its neighbors, including Taiwan.”

That seems like it could be read as if Friedberg is saying Taiwan is a separate country. Is it just sloppy wording, or is Friedberg intentionally making a point? This statement could be another reason for China to have concerns about Romney. Perhaps Beijing needs to send a message to major Romney backer and Las Vegas/Macau casino magnate Sheldon Adelson?

Chinese media reports that US regulators are investigating possible insider trading around the merger announcement of Youku and Tudou. So far there are no reports in English. Given the trading activity in Tudou and Youku just prior to the transaction news, it looked pretty obvious at the time that the deal had leaked. Insider trading ahead of M&A involving at least one Chinese firm looks increasingly to be the rule, not the exception. US regulators seem to have realized these deals are target rich environments.

Today’s links:


人民日报-住房保障,让全体人民住有所居(科学发展 成就辉煌·民生专稿) ——十六大以来民生领域发展成就述评之六 page 1 people’s daily on achievements in building public housing. lots more to build, not getting this policy implementation right has really constrained the government’s options//

Heard on the Street: The Tip of the Iceberg for China’s Banks – – Are they less healthy than US big banks? Is there any reason to believe US banks are more transparent/honest in reporting their loan books?//It’s not time to man the lifeboats yet, but there are reasons to believe China’s bank balance sheets aren’t as watertight as they first appear.

房地产十二五规划拟开征房产税 支柱地位动摇_财经频道_一财网 – more on possible property tax

China’s arms exports flooding sub-Saharan Africa – The Washington Post – China’s arms exports have surged over the past decade, flooding sub-Saharan Africa with a new source of cheap assault rifles and ammunition and exposing Beijing to international scrutiny as its lethal wares wind up in conflict zones in violation of U.N. sanctions..Weapons from China have surfaced in a string of U.N. investigations in war zones stretching from the Democratic Republic of the Congo to Ivory Coast, Somalia and Sudan. China is by no means alone in supplying the arms that help fuel African conflicts, and there is no proof that China or its arms exporters have intentionally violated U.N. embargoes in any of those countries.

U.S. Foreign Arms Sales Reach $66.3 Billion in 2011 – – looking forward to official Chinese media on this…Sunday Washington Post has a front page article on Chinese weapon sales to sub-saharan Africa. Has anyone done a study of whose weapon sales kill more people, perhaps a dollar to body ratio figure?. Do buyers get more bang for the buck from American, Russian or Chinese arms?// Weapons sales by the United States tripled in 2011 to a record high, driven by major arms sales to Persian Gulf allies concerned about Iran’s regional ambitions, according to a new study for Congress…Overseas weapons sales by the United States totaled $66.3 billion last year, or nearly 78 percent of the global arms market valued at $85.3 billion in 2011. Russia was a distant second, with $4.8 billion in deals.

Shanghai considers free license plates for green vehicles|Business| – According to Shanghai Commodity International Auction Co, the average price of a private Shanghai license plate in July was 58,271 yuan ($9,140), up 44 yuan on the previous month.

Over 1 million vie for 20,000 car plates in Beijing – Xinhua | – 19,926 won the right to register a car. If you really want to a license plate in Beijing I hear the going rate on the black market is 150k RMB or so. Shanghai’s transparent auction system is much better//

Hong Kong apartment fetches record $61 million – Yahoo! News Canada – A luxury apartment in Hong Kong has sold for a record HK$470 million ($61 million), making it the priciest condominium in the Chinese city and possibly the second most expensive in the world, reports said…An unidentified buyer paid the HK$75,806 ($9,773) per-square-foot price for the 6,200-square-feet (576-square-metre) unit at Opus Hong Kong in the upmarket Peak residential area, Hong Kong Economic Journal and Sing Tao Daily said.

Fraud, Culture and the Law: Can China Change? – China Real Time Report – WSJ – The persistence and extent of fraud in China, despite a near constant string of crackdowns and arrests, raises fundamental questions about cultural forces in Chinese society that limit the reach of law.



人民日报-打磨互联网监管准则需要合作(国际论坛) –钟 声  Zhongsheng in People’s Daily on why Internet should be managed by global body, not US/”West”//

Chinese icebreaker continues Arctic voyage on high-latitude seaway – Xinhua | – A Chinese icebreaker continued its Arctic voyage on Sunday while sailing along a high-latitude seaway, the first by a Chinese vessel in the Arctic Ocean…The icebreaker Xuelong, or “Snow Dragon,” started to head northward from the west of Svalbard, an archipelago in the Arctic, and reached the edge of ice sea 81 degrees north latitude Friday.

After Violence, India Cracks Down on Web and Texts – – NEW DELHI — The recent panic that led tens of thousands of Indians to flee their homes has largely subsided, leaving in its wake an uneven government crackdown on the Internet and text-messaging services that top officials blame for circulating the baseless rumors that set off the exodus.

心脏病之痛!中美航空发动机差距到底有多大_军事_环球网 – global times compares US and China jet engine development// 中国致力于开发国产高性能航空发动机,用于装备国产军用飞机的战略方向已经明晰,这一战略选择包含着重大的航空技术挑战,世界上仅有少数几家大公司真正掌握着这项技术。这本身并不奇怪:发动机对于飞机的重要程度,不亚于心脏对于人体。发动机的设计研发,面临着温度、压力、过载等一系列严峻问题,只有最为先进的材料,最为合适的加工方法,科学的设计,合理的使用维护,才能解决这些难题。近些年中国在材料和制造方面取得了一些进步,但在部件和系统设计、集成以及根据可靠性特征制订勤务和使用管理方案等方面仍然存在问题——这些方面是优化发动机使用效能的关键。

Chinese Deny Forcing Kachin Refugees Back to Myanmar – – The Chinese Foreign Ministry has denied human rights advocates’ reports that China is forcing ethnic Kachin refugees to return to a war zone in Myanmar, saying that the people are going home of their own accord.



Chinese Orgy Photos Shake Up Chinese Officials – – The government has declared orgies, formally called “crowd licentiousness,” to be illegal. Two years ago, in a rare invocation of the law, judges handed down a three-and-a-half-year prison sentence to Ma Yaohai, a 53-year-old professor who lived with his mother in Nanjing and found group sex partners in online chat rooms, where he used the handle Roaring Virile Fire.There is no indication that the people in the Lujiang photographs have been charged with any crime. Pan Suiming, a prominent sexologist at Renmin University, said in an interview that the penalty for group sex can be up to 10 years in prison. His research showed that as many as 5 percent of Chinese adults have had multipartner adventures.



Actress Zhang Ziyi to produce second romantic comedy – Xinhua | – and travelling to several countries for filming? what happened to those boxun rumors, and how is that lawsuit going?

Lenovo Vaults to Second Place in China Smartphone Market – Bloomberg – Lenovo vaulted from seventh place in the first quarter to claim 11 percent of China’s smartphone sales in the three months ended June 30, market researcher IDC said in an e-mailed statement today. Apple’s share fell to 10 percent from 19 percent, IDC said. Both trailed leader Samsung Electronics Co. (005930)’s 19 percent share, which was unchanged from the first quarter.

Silicon Valley’s Hardware Renaissance – – PCH International key to this//To prove his point, Mr. O’Sullivan recently took teams from nine small start-up companies to Shenzhen, China, for 111 days in which each group developed and began manufacturing new products. He calls his investment firm, based in San Francisco, Haxlr8r (pronounced hak-CEL-erator), and in June the first group of fast-to-market hardware products was unveiled. The companies included Shaka, which makes a simple device for measuring wind for sailboard and kite surfers, and Kindara, maker of an iPhone accessory to help women determine when they are ovulating. (The system automatically generates a text message to the husband at the appropriate time.) There is also Bilibot, a project to build an inexpensive open-source robot.

Chinese state firms’ PR specialists visit US for image-building insights| – did they offer the Post guidance on how to better position the China Daily insert?// Public-relations officials from Chinese State-owned enterprises, led by Mao Yixiang (fourth from right) of the State Council’s Assets Supervision and Administration Commission, observe a journalist working during their visit to the Washington Post’s newsroom on Monday. Sun Chenbei / China Daily



广州公安副局长何靖涉嫌严重违纪接受调查|广州|公安|副局长_新浪新闻 – A Guangzhou deputy police chief is under investigation for “disciplinary violations”, 20 others detained to “assist the investigation”

北京打工子弟学校关停1年:1成学生入公立学校_网易新闻中心 – only 13.6% migrant kids affected by school shutdowns last year went to public school in Beijing, 33% went home// 核心提示:2011年6月,北京市大兴、朝阳、海淀、昌平等地24所打工子弟学校被关停,涉及学生近1.4万名。当年8月16日,北京市教委承诺,“不让一个孩子失学”。近日,媒体抽样调查显示,最终进入公办学校的学生占总人数13.6%;而离京返回原籍读书的学生占到了33%。

表演艺术家叶子在京去世 享年101岁_网易新闻中心 – Actress Ye Zi has died in Beijing at 101

Meeting China’s mega art collector – YouTube – Chinese businessman Zhang Rui reveals eight-hundred pieces of contemporary works, most of them stored away in his home that doubles as a private art space.

47 killed in two traffic accidents|Society| – Thirty-six people were killed early on Sunday morning after a bus rammed into a tanker carrying methanol, a highly flammable liquid, and caught fire on a highway in Northwest China’s Shaanxi province. Three people were injured, two of them seriously.And an accident in Sichuan province, in broad daylight on Sunday afternoon, killed 11 people when a van, with 12 people, including three children, collided into the rear of a stationary truck.

China Exclusive: Scientists looking for site for giant solar telescope – Xinhua | – Chinese scientists are looking for a site for a giant solar telescope, which will be the world’s largest in the next two decades with data helping to understand solar activities…The Chinese Giant Solar Telescope (CGST), or one of “the next-generation ground-based solar telescopes,” will lead a field of solar observation in 20 years, if the construction is approved and starts in 2016, according to Prof. Deng Yuanyong, director of Huairou Solar Observing Station of the National Astronomical Observatories (NAO) under the Chinese Academy of Sciences (CAS).

Man pricked by HIV-infected needle in taxi, dumped by girlfriend for that | Ministry of Tofu 豆腐部 – man in Beijing got his knee pricked by the needle of an HIV-infected syringe on the evening of August 21 when he was on a taxi cab. Even though the preliminary test showed he has not been infected, he was still uneasy and anxiously waiting for. His girlfriend, on hearing the news, broke up with him in fear.