Happy New Year!
I am only making three predictions for 2015 (it’s a sucker’s game) but those who want to see how I did for 2014 can read this post from a year ago, updated with what was right and what was wrong.
- The corruption crackdown will intensify and at least one more Zhou Yongkang-level tiger will down, as will at least one member of the “red nobility”;
China’s economy will have another rough year but it won’t collapse and the Shanghai Composite will at some point hit 4500 in this “Xi Jinping bull market”, though probably not this month; [MAY 4, 2015 UPDATE: The Shanghai Composite hit 4500 in the last week of April. The market move has been ridiculous from any fundamental perspective, but the animal and propaganda spirits driving the rally still seem strong. That said, people are getting nervous and I will guess the market corrects to closer to 4000 before hitting 5000 later in 2015…Just another guess, as are everyone’s about where the market is headed. END UPDATE]
Xi Jinping will still be in charge at the end of 2015 and will make significant progress on economic reforms.
I am planning some changes for the newsletter, starting with a weekend edition featuring expert guest commentary. I am hoping to send the first of those this weekend or next, and would love to feature writing from subscribers. I am looking for non-ideological, fact/research-based work on important topics that are either ignored or “under-covered” in mainstream media. I can’t pay but your work will go out to more than 17,300 readers, including some of the most influential China watchers around the globe. If you are interested please get in touch.
THE ESSENTIAL EIGHT *
1. China’s Maoists Are Revived as Thought Police – NYTimes.com The latest directive, Document No. 30, demands cleansing Western-inspired liberal ideas from universities and other cultural institutions, according to Song Fangmin, a retired major-general, who discussed it with dozens of veteran party officials and hard-left activists at a meeting in Beijing in November. The directive formed a sequel to Document No. 9, which Mr. Xi authorized in April 2013, launching an offensive against ideas such as “civil society,” General Song said. “These two documents are extremely important, and both summarize speeches by the general secretary,” he said, referring to Mr. Xi by his party title. “They identify targets so we can train our eyes on the targets of struggle.”…Now, however, leftist voices are back in vogue. Analysts say it is unlikely Mr. Xi wants to take China back to Mao’s puritanical era, but doctrinaire Communists see him as a useful ally, and his directives as a license to attack liberal critics of the party. // FWIW, didn’t Deng Xiaoping also oversee phases of significant ideological retrenchment? Regardless, things are grim and getting grimmer.
Related: [视频]宋方敏：当今中国意识形态领域状况 – 乌有之乡网刊 Video of Song Fangmin in November discusses the ideological environment in China, and documents 9 and 30 // 十八大以来，总书记高度重识意识形态工作，
Related: Reading Chinese politics in 2014 – China Media Project As we come to the end of 2014, we can say that this year has brought a “hardening” (板结) of China’s political discourse. It’s been a year of cleansing in the ideological sphere, and we find now that virtually all of the terms related to political reform, ones we might previously have classified as “light blue” (浅蓝) — not part of the official Chinese Communist Party discourse but still tolerated — have entered the taboo zone of the “dark blue” (深蓝). Meanwhile, the “light red” terms (浅红) favored by those in power have undergone a complete shake-up (全面重组). To top it all off, a number of “deep red” keywords associated with the Maoist pre-reform era have made a comeback.
2. Witnesses: Sequence of errors led to Shanghai stampede-AP On New Year’s Eve of 2013, Shanghai authorities sent about 6,000 city police officers and requested help from military police to manage a 300,000-strong crowd that filled the city’s famed riverfront for the annual midnight light show. According to state media, police choked off access to an elevated viewing platform reachable through staircases and closed the nearest subway station to rein in the crowd. On Wednesday night, just as many revelers showed up to ring in 2015, but the venue was guarded by only 700 police officers with no traffic control, state media reported. People were free to walk up and down the staircases, and the closest subway station was left open. // tragedy an opportunity for Xi to make personnel changes in Shanghai?
Related: Censors suppress Shanghai stampede coverage as blame game begins | South China Morning Post Shanghai authorities have brought down a wall of strict censorship on local coverage of Wednesday night’s deadly stampede, as questions mount over how such a tragedy could have occurred in the mainland’s wealthiest and best-managed city. Local sources said the censorship was “unprecedented and harsh” and officials were worried that they could be blamed for the stampede that killed at least 36 people.
3. Party Opens an Inquiry Into a Onetime Aide to China’s Ex-Leader – NYTimes [Ling Jihua’s] downfall on Monday came in the same manner as those of several other senior officials who had been recently toppled on corruption allegations: A tightening circle of investigations targets the official’s family and associates, and then the official is removed with a brief announcement from the party’s anticorruption agency. The party’s investigation is usually followed by a criminal inquiry and a trial that ends in a guilty verdict and a prison sentence dealt out by a party-run court. In Mr. Ling’s case, that termination was particularly precipitous. Just last week, his essay lauding Mr. Xi’s policies toward ethnic minorities was published in Qiushi (Seeking Truth), the party’s premier doctrinal journal. Mr. Ling said he was sure that “under the staunch leadership of the party center with Comrade Xi Jinping as general secretary,” China’s Tibetans, Uighurs and other ethnic minorities would have a bright future. // Chinese and overseas media then unloaded will all sorts of reports about his deeds. The announcement came on a Tuesday, seemingly out of step with the CCDI’s preference for big announcements on Fridays. One unverifiable report claimed official hands were forced to move earlier than planned because his wife was caught trying to flee…
Related: Heilongjiang Officer Nabbed in Graft Crackdown – Caixin A senior public security official close to Ling Jihua, a disgraced former vice chairman of the country’s top political advisory body, has been placed under investigation in China’s far northeast, a source has told Caixin. Gu Yuanxu, the public security department deputy chief in Heilongjiang Province, was taken away by authorities from Beijing after state media reported December 22 that the Communist Party’s graft fighters had targeted Ling, the source said. Ling had served on the Chinese People’s Political Consultative Conference. Gu is the younger brother of Ling’s wife, Gu Liping. The source did not say which agency is investigating him, nor why.
6. BBC News – Confucius institute: The hard side of China’s soft power Xu Lin is an unusual kind of Chinese official. For starters she accepted a request for a BBC interview. Admittedly she came quickly to regret it, demanding that we delete a large section of our recording. But given that unelected Chinese officials do not need to court their own domestic media, let alone the international press, it is rare to be invited in at all. And it is even rarer to find an official who is prepared to be interviewed in English. // quite a remarkable video
Related: Stockholm University terminating its Confucius Institute | H-Asia | H-Net Stockholm University in Stockholm, Sweden, has scrapped its Confucius Institute, in place since 2005. It was one of the first installed anywhere, and the first in Europe. The university’s chancellor Söderbergh Widding told the Swedish press that the reason was that other China links now fulfilled the need — suggesting that the CI had become obsolete. Moreover, she concluded (in a turnaround of opinion) that “Generally it is questionable to have, within the framework of the university, institutes that are financed by another country.”
7. Rural China’s economic model limps on | East Asia Forum– by Graeme Smith// As the Chinese economy has slowed, with structural issues unaddressed, old China hands are foretelling economic and possibly even political disaster. Yet in the counties of ‘middle China’ the informal, private economy — both the local state and local business — is thriving. Informal solutions are being found to problems that the central state is unable, or unwilling, to address. Notions of ‘predatory’ and ‘developmental’ states are simplistic. In practice, the formal local state is both prey and predator of the informal, or shadow state. When a mid-level official complains that his brother, who owns a computer shop, has to hand out tens of thousands of dollars’ worth of supermarket cards every year to ensure that contracts from the official’s department continue to flow, is there a victim? Moral categorisations make little sense. Moreover, a large part of the local party apparatus is quietly engaged in enabling local enterprises to get things done, often for their own benefit, either through the revenue from taxes levelled on service industries or from their own indirect involvement in business.// the full article, don’t have access–Getting Ahead in Rural China: the elite–cadre divide and its implications for rural governance – Journal of Contemporary China –
Related: The Yueqing Incident and Graeme Smith’s Essay “Political Machinations in a Rural County” | The Sinocism China Newsletter 2011 In 2009 Graeme Smith published “Political Machinations in a Rural County” in The China Journal. Almost exactly a year ago John Garnaut summarized Smith’s article in The Sydney Morning Herald. As Garnaut wrote: Benghai is the made-up name for a real and thriving county in Anhui province. A year ago I toured Benghai with Graeme Smith, a scholar at the University of Technology, Sydney. Since then, Beijing’s regular corruption crackdowns have appeared to me to be little more than pantomime, designed to reassure the public and defeat the odd political adversary.
8. Four decades in China: Jaime FlorCruz signs off – CNN.com CNN Beijing bureau chief Jaime FlorCruz is the longest serving foreign correspondent in China; he’s lived and worked in China since 1971. He studied history at Peking University (1977-81) and was TIME Magazine’s Beijing correspondent and bureau chief (1982-2000). Jaime retires from CNN on December 31, 2014. As a tribute to Jaime, we’ve added some of his favorite stories to the sidebar of this piece.
BUSINESS, ECONOMY AND TRADE *
China’s Cities Face Judgment Day on Debts as Costs Soar – Bloomberg Borrowing costs soared by a record amount last month before today’s deadline for classifying liabilities, on speculation some local government financing vehicles will lose government support after the finance ministry starts reviewing regional authorities’ debt reports. Yield premiums on one-year AA notes, the most common ranking for such issuers, jumped a record 98 basis points in December.
Explanation of China’s new shadow margin lending, made possible by a Jack Ma owned company | chiecon According to Caixin, “this margin trading has already reached 800 billion yuan, doubling in July, and will soon be worth over 1 trillion yuan”. But they remark “after 4 years, margin trading has already become quite common, so brokers now have a new tool to offer their high net worth and institutional clients, which has a market size of 300 billion yuan. And the portion of that used for direct margin lending and trade leverage is worth 10 billion yuan”. This new margin lending (in Chinese ‘peizi’ 配资) does not face any of the usual margin trading restrictions. ‘Peizi’ is a runaround of the regulations that provides greater leverage of up to 5 times, and the borrowed money used for this trading goes unreported, creating an oversight problem for the CSRC. // market soared on first day of trading of 2015, closed at 3350
Macau Casinos Drop $75 Billion as China’s Crackdown Continues – Bloomberg As Xi Jinping makes his first visit to Macau as China’s president this week, the city’s casinos would like to hear a reassuring word that might revive their tumbling stock prices. They’re not likely to get it. Xi, who arrived today to mark the 15th anniversary of the former Portuguese enclave’s return to Chinese rule, is the man responsible for the two-year campaign against corruption in China, scaring away high rollers who have helped make Macau the world’s largest casino gambling hub and wiping out $75 billion of casino operators’ market value — bigger than the entire economy of Luxembourg.
New Asian bank to go into operation by year end – Xinhua MOF said that the founding nations of the bank are expected to complete negotiations over and subscription of the bank’s charter and regulations before June this year. A MOF statement also said that the Maldives has become the latest prospective founding member of the bank after a consensus was reached among the 22 existing members on Dec. 31.
天弘基金股东翻脸 蚂蚁金服愤起仲裁公司频道财新网 【财新网】（记者 屈运栩）阿里巴巴的金融业务遇到了意料之外的麻烦。1月4日，
China frees prices of commodities, services in fresh reforms | Reuters The official Xinhua news agency in a report said that China began to liberalize the farm produce market in 1978, and the government has now only retained its regulatory role through state storage programs, by maintaining minimum prices and giving subsidies on some products. The NDRC announcement showed that prices of railway bulk cargo, parcels and privately-funded cargo and passenger transport had also been allowed to freely float. Among others in the latest reforms, prices of domestic air cargo, passenger transport of some airlines, port service fees, such as fees on container loading, ship rubbish treatment and water supply, were also allowed to be set by the market.
Jack Ma to create business school at former exclusive club｜WantChinaTimes Among the 30 closed facilities was this Jiangnan Club, a luxurious private members’ club formed by Jack Ma, founder of the Alibaba Group, and other businesspeople in Zhejiang province. Alibaba plans to turn the now defunct club into Lakeside University, a school offering classes for entrepreneurs. Speaking on the reason for the change, Zhang Zhenyi, an Alibaba employee, said there aren’t enough universities focused on entrepreneurs in China
Anbang Insurance Becomes China Minsheng’s Largest Shareholder – Caixin Privately held Anbang Insurance Group Co., Ltd. increased its stake in China Minsheng Banking Corp. to 17.16 percent with a series of purchases in December, becoming its largest shareholder. The money for the purchases came primarily from the sales of Anbang’s and its subsidiaries’ insurance products, open materials for the transactions show. The purchases, which Caixin estimates involved 40 billion yuan, are the latest in a string the insurance firm has made over the past few months to diversify and strengthen its operations in and beyond the financial industry.
SFC wants US short-seller probed on false Evergrande report Hong Kong’s Securities and Futures Commission has called for an investigation into US-based stock market analyst Citron Research for possible market misconduct. The SFC said the research institution, headed by short-seller Andrew Edward Left, issued a report in June 2012 accusing Evergrande Real Estate Group Ltd. (03333.HK) of fraud in financial reporting. The property developer’s share price plunged as much as 19.6 percent as a result of the report, which was allegedly based on false information. Left took a short position on the stock before issuing the report and later pocketed HK$1.7 million profit from the deal.
BMW to Pay $820 Million to China Car Dealers, Group Says – Bloomberg The subsidies are the largest by an automaker to its retailers in China and will be paid by the end of February, said Song Tao, a deputy secretary general of the China Automobile Dealers Association, which represented the BMW distributors in the negotiations. The dealers are still in talks with the Munich-based carmaker over this year’s sales targets, he said.
Academics Hail State Council’s Plan to Unify Pension Programs – Caixin The State Council has proposed unifying the pension systems for civil servants and those working in the private sector. Under the revamp, civil servants would be required to contribute to pension fund just like employees in the private sector. A unified pension plan would also close the gap between pension payment levels for civil servants and those in public sectors such as teachers with that for employees in private businesses, a difference that has been a source of public grievances for years.
Inner Mongolia, Shanxi Beset by Bad Loans, Banking Sources Say – Caixin Coal prices have fallen this year to half of what they were during a 2011 peak due to oversupply caused by improved production capacity in recent years and weakened demand. Ordos, city in Inner Mongolia, has a total of 10 billion yuan in bad loans, amounting to one-third of the region’s total, one employee of a city bank said. Bad loans accounted for 3.8 percent of total bank loans in the city. The ratio in Inner Mongolia as a whole was 2.2 percent. Shanxi had a ratio of 5 percent, said another industry source. The person could not put a value figure on the province’s bad loans.
POLITICS AND LAW *
China takes rare step of naming Communist Party factions tied to disgraced top cadres | South China Morning Post Xinhua has made a rare acknowledgment of factions within the Communist Party, and named key members who are tied to disgraced top cadres Zhou Yongkang and Ling Jihua. But President Xi Jinping had weighed the risks in going after such “tigers”, the state mouthpiece said. “Tigers” refer to leading national figures targeted in the anti-corruption campaign. In an article carried on its affiliated news portal over the weekend, Xinhua named several fallen senior officials as connected to the so-called Shanxi Gang, Secretary Gang and Petroleum Gang.
Nanjing Party Boss Latest to Run Afoul of Corruption Busters – In December 2000, Yang was transferred to Suzhou to become its acting mayor and deputy general secretary of its party committee. He became the party boss of the Wuxi government in November 2004, and two years later, he joined the Standing Committee of the Jiangsu party committee. He was appointed Nanjing’s party chief in March 2011. During his stint in Wuxi, Yang frequently visited the hometown of Zhou Yongkang, a former member of the Politburo Standing Committee and now the focus of a graft investigation, people who lived in the area said. Many officials used these visits as a pretext for establishing and strengthening connections with Zhou’s family in hopes of advancing their careers.
China replaces head of state news agency Xinhua – Channel NewsAsia The appointment of Cai Mingzhao, a vice director of the propaganda department, is the latest of several replacements in the party’s key information and media agencies over the past year. Cai, 59, replaced Li Congjun, who turned 65 in October and reached the age limit for ministerial-level posts, the agency said in a statement. Cai is “politically sober and firm, keeps an appropriate grasp in guiding public opinion and conscientiously aligns himself with the party’s central committee”, the statement quoted Pan Ligang, a deputy head of the party’s Organisation Department, as saying.
Xinhua Insight: CPC trains next-generation politicians with Marxism belief – Xinhua | Xu, now a junior at Wuhan University in central China’s Hubei Province, had only a vague idea of communism three years ago when joining the Communist Party of China (CPC) in high school. But she consolidated her Marxism belief after attending a “Young Marxist Training Program” that was initiated by the CPC Hubei provincial committee in July 2014 and will last till her graduation. She said she was inspired by studying classical works, including the Communist Manifesto written by Karl Marx and Friedrich Engels. A one-month work experience at a township government made her better understand the leading role of the CPC, which considers Marxism as a guiding ideology in the world’s most populous developing nation.
Xi’s speeches on reform published in foreign languages – Xinhua Another book gathering Xi’s important remarks organized by the Publicity Department of the Communist Party of China Central Committee has sold more than 15 million copies to date. The publishers announced total sales have reached 15.11 million, including 95,000 copies in ethnic minority languages. // so less than 20% of Party members have bought? Or they get it for free
Cautionary tales on the risks of doing business in China from freed Australian Charlotte Chou In a story of a similar vein to numerous others, one American woman, an office secretary in her 30s, was told she had won a prize but had to travel to Guangzhou to collect it. After waiting for nearly two weeks, she was told she then had to go to Sydney to collect it, and was provided with extra suitcases to help with the load. Unable to detect anything suspicious with the naked eye, she was arrested at airport customs two months ago – bags of ice were concealed in the lining of the luggage. The Department of Foreign Affairs and Trade issued a travel advisory in September warning “travellers have been asked to carry goods concealing narcotics out of China”, and that in recent months authorities had executed foreigners found guilty of smuggling drugs.
中央多个部委发放车补 公务出行打车加油费自理新闻腾讯网 新京报讯 2014年12月31日是中央机关单位公车改革的“大限”：
新一年 人民日报有哪些新变化 People’s Daily on its layout changes for 2015 // 新年伊始，人民日报以崭新的面貌与广大读者见面了。
焦点 | 再一次“支持孙海英” (关于环球时报：
Quora-Why do many people feel that Chinese can’t possibly be basically ok with their government or society? – Quora I believe that China is only a generation or two from being able to fundamentally change in the direction of more pluralistic politics, greater freedoms of expression, of faith, of assembly. // always hopeful
FOREIGN AND DEFENSE AFFAIRS *
Japan, China had agreement to maintain Senkaku status quo, Suzuki-Thatcher files show | The Japan Times Japan and China agreed to maintain a status quo on the Senkaku Islands and avoid any discussion over their respective sovereignty claims, the late Prime Minister Zenko Suzuki was quoted as saying in a 1982 conversation with British Prime Minister Margaret Thatcher, according to British government files released this week. The comment was reportedly made during a private conversation on Sept. 20 of that year.
China Overhauls Diplomacy to Consolidate Regional Leadership, Outline Strategy for Superpower Ascent | The Jamestown Foundation At the Central Work Conference on Foreign Relations held on November 29, China’s leaders outlined the most sweeping changes in decades to longstanding guidance on foreign policy. Chinese President Xi Jinping outlined instructions to consolidate China’s leadership of Asia and strengthen international support for Chinese power. While Xi’s direction to increase the country’s contributions to address global problems offers the welcome prospect of cooperation with the United States on pressing problems, the conference’s outcomes also point to an increasing competition for leadership and influence at the regional and global level. With its options for constraining Beijing’s power receding, Washington will find itself under pressure to step up competitive and cooperative policies to protect U.S. interests in a manner that avoids escalating tensions to the point of a destabilizing rivalry.
China’s deep-sea sub explores Indian Ocean seabed – Xinhua Jiaolong is on a four-month mission to research polymetallic sulfides, biological diversity, hydrothermal microbes and genetic resources in the southwest Indian Ocean
Naval base builds 22m-high wall to hide from neighbors- China.org.cn A naval base in Dalian city, Liaoning province, built an 800-meter-long, 22-meter-high wall to keep from being spied on. At an investment of more than 10 million yuan ($1.61 million), the wall was erected because a group of European-style villas nearby were too tall.
Deputy chiefs named in China’s latest power reshuffle in government and military | South China Morning Post The Chengdu command’s chief of staff and princeling general Zhou Xiaozhou was also appointed to become its deputy commander, online news outlet ThePaper.cn cited Zhanqibao as saying. Zhou is the son of Zhou Yibing, former commander of the Beijing Military Area Command. The senior Zhou headed the Beijing command during the 1989 Tiananmen Square crackdown.
Venezuela’s Maduro to visit China, OPEC nations amid cash crunch | Reuters His first stop will be China, which has become Venezuela’s principal financier through oil-for-loan agreements in which Venezuela receives cash up front in exchange for future deliveries of crude and fuel. “Also, I’m going to visit other OPEC countries to continue high-level efforts (to create) a strategy for a recovery of oil prices, a strengthening of OPEC,” Maduro said. He provided no other details.
Chinese Special Operations Forces: Not Like “Back at Bragg”-Dennis Blasko This essay outlines the structure and doctrine of the Chinese armed forces involved in special operations and discusses their capabilities in each of the ten core activities based solely on information from Chinese sources. But first it is necessary to put the Chinese armed forces into the context of the entire government security structure.
Francis Fukuyama: ‘In recently democratised countries I’m still a rock star’ | Books | The Guardian The Origins of Political Order, which narrates the emergence and growth of the state “From Pre-Human Times to the French Revolution”, engages respectfully with Chinese history and culture, and features an overarching version of national history that the Chinese themselves no longer teach or learn. Enough of his account of the country’s enormous historic strengths and equally enormous historic weaknesses survived the censor’s scalpel to make the work valuable to the Chinese reading public. Fukuyama goes on to say that a friend in Beijing had learned that the Communist party would translate that book’s recently published companion volume, Political Order and Political Decay for publication in a private edition for its senior leadership. “They take the analysis seriously,” he said.//his analysis sounds very useful for Beijing
Suspected North Korean army deserter kills four Chinese: Yonhap | Reuters A suspected North Korean army deserter has been detained in China after killing four Chinese during a robbery in the border city of Helong late last month, Yonhap News Agency reported on Monday. The incident occurred on Dec. 28 just across the Tumen River dividing China and North Korea, the report quoted unidentified sources as saying.
Typist sentenced to death in China for leaking military secrets | South China Morning Post A young typist who worked at a Chinese military manufacturer’s research centre that was developing a secret weapons system has been sentenced to death for spying for a foreign intelligence agency, according to a state-run media report. Yu Hongyang, a member of staff at an unnamed research office, was said to have damaged national security by leaking state secrets, the news website of the Global Times newspaper reported. // 打字员出卖制胜武器机密被判死
Full Text of Foreign Minister Wang Yi’s Speech on China’s Diplomacy in 2014(1) – China.org.cn Foreign Minister Wang Yi on Wednesday attended the opening ceremony of the Symposium on the International Development and China’s Diplomacy in 2014 co-hosted by China Institute of International Studies and China Foundation for International Studies and delivered an address titled “2014 in Review: A Successful Year for China’s Diplomacy”.
Chinese warships come closest to Senkaku Islands – AJW by The Asahi Shimbun Two Chinese warships came within about 70 kilometers of the Senkaku Islands in mid-December, the closest approach since the Tokyo-Beijing feud erupted in 2012 over sovereignty of the islets in the East China Sea, sources said.
Sweeping change of China’s top military guard | South China Morning Post A military observer said the changes were tied to the ongoing push against corruption but the defence ministry insisted they were simply routine. The winter reshuffle, apparent from indirect references in state and military media reports, comes as President Xi Jinping’s graft crackdown rolls its way through the military, a campaign epitomised by the arrest of Xu Caihou , once the military’s second-in-command.
CPC reshuffles political commissars of four armed services｜WantChinaTimes.com As part of the reshuffle, Zhang Haiyang, political commissar of the PLA’s Second Artillery Corps, Liu Xiaojiang, political commissar of the PLA Navy, and Liu Chengjun, head of the PLA’s Academy of Military of Military Science, are all stepping into retirement after reaching the age of 65.
A Chinese View of the World’s Most Important Relationship | Foreign Policy In any case, the upper echelons of Chinese power share something with the country’s grassroots: Both understand that China is not the superpower that the United States is, and cannot become one without radical changes to the status quo at home and abroad. Chinese Vice Premier Wang Yang put it bluntly and humbly in Chicago on Dec. 17, when he told the China-U.S. Joint Commission on Commerce and Trade that Beijing is neither willing nor able to challenge U.S. dominance of the global economic order, and that “in the process of cooperation, China hopes the United States would come to understand Chinese ideas more.” Chinese netizens across the political spectrum accept this strategy. Self-proclaimed democracy advocates such as Jing Yunchuan, a Beijing-based head lawyer, stress the necessity to cooperate with the U.S. and not resist it, while even hawkish observers like Gary Su, who edits a popular military website, welcome the strategy, believing it will buy China more time to rise as American supremacy falls
Cover Story – American Review – Global Perspectives on America Don’t presume that tensions between China, a rising state, and the United States, the status quo power, will lead to conflict By Karl Eikenberry
U.S. Ambassador in Beijing on Getting It Right – Caixin In an interview, Ambassador Max Baucus commends the Chinese and U.S. presidents for talking, and urges more
China lodges protest after Obama approves Taiwan frigate sale | Reuters China said on Friday it had lodged a protest with the United States after President Barack Obama signed into law legislation authorizing the sale of up to four Perry-class guided missile frigates to Taiwan. Foreign ministry spokesman Qin Gang said the Taiwan issue was one of China’s core interests and remained the most important and most sensitive issue in Sino-U.S. ties.
Chinese Maritime Activism: Strategy Or Vagary? | The Diplomat Notwithstanding these criticisms, there is still much good in Jakobson’s work. If she has not produced a viable alternative to the old theory, she has at least laid down a challenge to the “salami-slicing” camp, forcing them to shore up their arguments. If their interpretation is to be validated, they’ll also need to quote “interlocutors” in Beijing and cite articles published in Ocean Development and Management. It is no longer enough to say China has a master plan; people now need to show their evidence. And it is important that they do. For dueling theories of Chinese state behavior are not just recondite contests between professors. Statesmen decide policies with these “frames” in mind.
China raises Nepal aid five-fold in regional diplomacy push | Reuters – China will increase official aid to Nepal by more than five times from fiscal 2015-16, officials said on Friday, to develop infrastructure in the landlocked nation where regional rival India has long wielded political influence. The jump in assistance was announced after talks between visiting Chinese Foreign Minister Wang Yi and his Nepali counterpart Mahendra Bahadur Pandey, part of a deepening engagement which is expected to lead to a visit by President Xi Jinping next year.
The Year the Training Wheels Came Off China | Foreign Policy China agrees with that sentiment. Now indisputably an economic behemoth, it paradoxically no longer wants to be defined by GDP growth. Instead, it is pivoting to focus on a set of post-growth problems — basically, how to meet the changing expectations of a wealthier middle class and how to behave as a legitimate global power. Indeed, this is the year that the training wheels came off China. But here’s the rub: An active global player will now be endlessly judged in the court of global public opinion. If China wants to play in every corner of the globe, it had better get used to the world watching and judging its every move.// and China’s response is that global public opinion is biased and so it needs to increase its share of voice and influence.
HONG KONG, MACAO AND TAIWAN *
Taiwan Approves Medical Parole for Imprisoned Ex-Leader – NYTimes.com Chen Shui-bian, the imprisoned former president of Taiwan, was expected to be released on medical parole on Monday, after Justice Ministry officials accepted the recommendation of a panel of medical experts that his failing health could be better treated at home.
Special Report: The mainland’s colonization of the Hong Kong economy | Reuters it is here, in the city’s business sector, that China is inexorably tightening its grip on the former British colony. Even as Beijing struggles to tame Hong Kong politically, Chinese companies are consuming ever bigger chunks of the city’s key sectors including real estate, finance, power, construction and the stock market. Many of these industries have for decades been dominated by the business titans who attended the meeting with Xi. Men like Li Ka-shing, Asia’s richest man, casino and hospitality billionaire Lui Che-woo and palm oil magnate Robert Kuok. Now they are witnessing a mainland business invasion of the city.
TECH AND MEDIA *
China’s box office sales surge 36 pct in 2014 – Xinhua China’s box office sales totaled 29.6 billion yuan (about 4.84 billion U.S. dollars) in 2014, up 36 percent year on year, the country’s film bureau said on Thursday. Domestic films raked in more than 16.15 billion yuan, accounting for 54.5 percent of last year’s box office revenues in the Chinese mainland, said Zhang Hongsen, head of the film bureau under the State Administration of Press, Publication, Radio, Film and Television…China gained 1,015 cinemas and 5,397 screens last year, bringing the total number of screens to 23,600.
China’s “Server Sinification” Campaign for Import Substitution: Strategy and Snowden (Part 1) | The Jamestown Foundation The spearhead of China’s server sinification effort is the Tiansuo K1 server. The K1 was jointly developed by Inspur Group, a Chinese SOE IT company, and MOST as part of China’s 11th Five-Year Plan, under the “high-end and fault-tolerant computer” program.  The server campaign also received substantial support from the Chinese government’s national high-technology development plan (also known as the 863 Program), which invested 750 million RMB ($122 million) in the program (Guangming Daily, January 22, 2013).  Since development of the Tiansuo K1 began in 2009, the project has advanced with astonishing rapidity, in large part due to assistance from the Chinese government and multiple SOEs.
A Historical Drama Shows Too Much Cleavage for China’s Censors – NYTimes.com “I really hate SAPPRFT!” wrote one user on Sina Weibo, referring to the State Administration of Press, Publication, Radio, Film and Television, China’s top broadcast regulator. “The show was so beautiful! It’s the Tang dynasty — the characters are supposed to have plump bosoms! Now you’ve cut it so all that’s left is a big head. Thumbs down.”// Have watched up to episode 11 so far on Tencent Video which offers the option of the “uncensored version”. Enjoyable, gotta love Fan Bingbing
Xiaomi Confirms It Sold 61M Phones In 2014, Has Plans To Expand To More Countries | TechCrunch Xiaomi, the Chinese smartphone maker that raised $1.1 billion last month, has confirmed that it sold 61.12 million phones last year, bringing in an apparent revenues of 74.3 billion CNY ($12 billion) in the process. The new figures were released by CEO Lei Jun on Weibo and are right in line with the company’s expectation for the year. Xiaomi sold 18.7 million devices in 2013, and 7.2 million in 2012, so the four-year-old company is continuing to grow its business at a rapid rate — its recent funding round valued it at $45 billion and it is now the world’s third largest smartphone maker.
Who killed Shooter.cn: was it the anti-piracy MPAA, or is censorship to blame? According to Techweb, China’s copyright authorities released a report yesterday that claims that the Shooter.cn takedown was a response to a complaint from the Motion Picture Association of America (MPAA). It’s a claim that does make some sense: the MPAA is perpetually on an anti-piracy crusade, and while Shooter.cn did not host any video files, it did apparently offer a premium service to users selling hard drives pre-installed with lots of HD movies – movies that Shooter.cn did not have the rights for. That service wasn’t at all popular – the company sold less than 100 hard drives a year – but it could have been enough for the notoriously unforgiving MPAA and China’s own copyright authorities.
China Lures Fresh ‘Internet Monitor’ Informants With Bonuses One of the state agencies involved in suppressing undesirable online content, the China Internet Illegal Information Reporting Center, placed a job advertisement on Thursday calling for fresh recruits to its team of monitors, the official Xinhua news agency reported. The center, which aims to “maintain order” on China’s tightly controlled Internet, to “safeguard the interests” of users and to “build a healthy, orderly civilization in cyberspace,” is looking for applicants aged 18 and above who are committed to the development of a healthy online environment. Applicants should have “a high level of social responsibility” and already have carried out such work “in their spare time,” it said.
Exiled Chinese writer faces web wrath over picture showing Chairman Mao’s image on naked protester – Telegraph A more likely explanation is that China’s legions of pro-government wumaoding – or 50-cent army – are exploiting Facebook’s complaints system to target users who post critical or controversial content about China. Both Mr Woeser and Mr Liao said they had had had no difficulties with the site until this week.
CNNIC leadership change coincides with blocking of Gmail | GreatFire.org On December 26, 2014, in an announcement posted on their website, a new chairperson for CNNIC was directly appointed by the Cyberspace Administration of China. The announcement of this appointment coincided with the complete blocking of Gmail. Cyberspace Administration of China (中央网信办) is chaired by Lu Wei, “China’s web doorkeeper”. Lu Wei is also the vice chair of the Central Propaganda Department, according to his official resume.
Hacked emails reveal China’s elaborate and absurd internet propaganda machine – Quartz Zhanggong’s propaganda department comes across as surprisingly large, yet comically unsophisticated. To get a sense of its inner workings, Quartz examined emails related to a single event: an online Q&A with the local Communist Party secretary earlier this year. What we found was a Potemkin online village of adoring citizens posting favorable messages and easy questions—all manufactured by the propaganda department.
SOCIETY, ART, SPORTS, CULTURE AND HISTORY *
Q. and A.: Jeremy Wallace on China’s Rush to Urbanize – NYTimes.com Jeremy Wallace, 35, is a political scientist at Ohio State University. His new book, “Cities and Stability: Urbanization, Redistribution, and Regime Survival in China” (Oxford University Press), is a look at how China has avoided the instability that urbanization has brought to many other countries around the world. Photo Jeremy WallaceCredit Courtesy of Jeremy Wallace In an interview, Mr. Wallace discussed why big cities pose a danger for authoritarian governments, what China has done to undercut those threats
Education Ministry Cuts Scope of Gaokao Bonus-Points Program – Caixin The Ministry of Education has said that most students will no longer be eligible for a program that awarded bonus points on the national college entrance exam for extracurricular activities. The overhaul of the controversial bonus-points system was announced on December 17 and will come into effect on January 1. The ministry said students from minority groups, overseas Chinese families or whose parents served in the military or died in a war would still be eligible for the extra points, but ordered regional education authorities to tighten oversight of their programs.
Gov’t Fleshes Out Reform to Gaokao System – Caixin so more pressure even younger? // The ministry provided details for a plan it announced on September 3 in which it vowed to reduce the weight that the “gaokao,” the annual national college entrance exam taken every June, carries for university enrollment. Under the reform plan, the university admissions process will also include evaluations of a student’s performance in tests taken during the three years of high school. Students can choose three subjects to be tested on from among a range of fields, including politics, history, geography, physics, chemistry and biology.
ENERGY, ENVIRONMENT, SCIENCE AND HEALTH *
Lawsuit Triggers Debate over Medical Mistakes – Caixin Beatings and even killings of doctors by angry patients have been reported in recent years, and now doctors have been targeted in a debate over whether they and their hospitals should face criminal charges for medical mishaps. Triggering the debate was a lawsuit filed by the husband of Ma Li, a comatose woman who was disconnected from life support and died in 2011 at Peking University People’s Hospital in Beijing. The lawsuit, the first of its kind in the capital and based on legal arguments rarely heard anywhere in China, claims Ma’s doctor should be held criminally liable for botched treatment before the death.
New Hospital a Springboard for Health Reform Caixin Doors have swung open to welcome up to 10,000 patients a day at the largest hospital in China backed by non-state investors, Peking University International Hospital (PUIH) on Beijing’s north side. The PUIH is wholly invested by PKU Health Care Industry Group, which is 60 percent owned by Founder Group, a conglomerate controlled by Peking University and the group’s management. The rest of PKU Health Care is owned by the Peking University…According to Founder CEO Li You, the group will use the hospital as a platform for pushing its wide array of for-profit, health care businesses.
Falling Through the Cracks of China’s Health-Care System – WSJ The government has spent about 3 trillion yuan on health care since 2009. The effort is crucial, many economists say, to turning China’s notoriously frugal savers into consumers by encouraging them to spend instead of socking the money away for medical emergencies. Still, millions are falling through the cracks, especially migrant workers who drift from China’s villages to work in factories in bigger cities. “Coverage is fragmented and the administration of it is not desirable,” said Dr. Zhang Wei, a health-care expert at Peking University’s Guanghua School of Management. Dr. Zhang said that despite the expansion of insurance coverage, the individual economic burden has increased. “It’s still a management problem,” he said
China approves experimental Ebola vaccine for clinical trials | Reuters The Chinese vaccine is being developed by the Academy of Military Medical Sciences, Xinhua said, a military research unit which is also involved in developing a drug to treat the disease. “This follows American and Canadian vaccines to become the third Ebola vaccine to enter clinical trials,” the official Chinese state news agency said.
Coastal Sprawl and a Last Stand for Wetlands – Caixin Researchers say half of China’s east coast wetlands have vanished since 1950 and urge more protection
Water From China’s South-North Transfer Project Flows to Beijing – NYTimes.com One scientist with the Department of Water Resources in China said that the new inflow of water would provide some relief to the capital but would hardly compensate for the overexploitation of aquifers. Each year, Beijing consumes about 3.6 billion cubic meters of water — 127 billion cubic feet or 950 billion gallons — about half of which came from underground sources before the central route was completed. Water tables have dropped by about 42 feet since 1998. “Beijing has around six billion cubic meters of overpumped aquifers that need to be replenished,” said the scientist, who spoke on the condition of anonymity
Chinese companies receive massive fine for polluting river – Xinhua Six companies in east China’s Jiangsu Province were ordered to pay 160 million yuan (26 million U.S. dollars) for discharging waste chemical to rivers by a court on Tuesday. It is the highest fine of its kind in China ever imposed. The companies from Taizhou City were ordered to pay the amount to an environmental protection fund within 30 days. They were found guilty of discharging 25,000 tons of waste acid into two rivers, which caused serious pollution, according to Jiangsu Provincial Higher People’s Court.
More Chinese cities to have real-time air quality readings – Xinhua Real-time air quality readings will be available in more Chinese cities from January 1, 2015, the Ministry of Environmental Protection (MEP) announced on Tuesday. Air quality will be monitored in 1,436 stations across 338 cities, and real-time readings of density for six pollutants — PM 10, PM 2.5, sulfur dioxide, nitrogen dioxide, ozone, and carbon monoxide — as well as the air quality index (AQI), will be reported to the public, according to the MEP. China began monitoring air quality in 74 major cities at the beginning of 2013, and later expanded the coverage to 177 cities with 552 surveillance stations in 2014.
Beijing pollution levels fall slightly in 2014 | Reuters Data released Sunday showed the city is making slow progress in combating pollution, which reports say ends hundreds of thousands of lives in China prematurely every year. Average concentration of particulate matter smaller than 2.5 micrometers, known as PM2.5, fell 4 percent from 2013 to 85.9 micrograms per cubic meter, the EPA said. The national standard is 35, although the government does not expect to meet the standard until around 2030. Sulfur dioxide (SO2) levels fell 17.7 percent, nitrogen dioxide (NOx) 1.3 percent and PM10 7.1 percent, the EPA said, while dust levels rose. As a result, Beijing’s 20 million denizens enjoyed 93 days with “excellent air quality” in 2014, up from 71 days in 2013, the EPA said.// 去年重污染天数少了13天国内新京报网
Is traditional Chinese food under threat as its greatest champion dies? – Telegraph The death of 82-year-old Feng Guangju, one of Beijing’s best-loved restaurateurs, has sparked fears that the traditional “Old Beijing Snacks” he championed could disappear
American at Center of Foster Children Saga Defends Himself | the Beijinger After a flurry of stories hit the Chinese media two weeks ago about a “missing” American man raising 11 orphans in Beijing (and the subsequent death of one of them), one thing was absent: a response from the man himself. Last Friday, we were able to arrange a face-to-face interview with the person at the center of this drama, Ray Wigdal. Over the course of two three-hour meetings last weekend in Beijing, we did our best to gather Wigdal’s side of the story. Inconsistencies in the story remain; in particular some accounts we’ve read in the Chinese news and coming from additional unnamed sources remain contradictory.
Controversial New Fares Barely Dent Beijing Subway Swarm – China Real Time Report – WSJ During the peak rush hours, the number of passengers taking the subway slipped only 5.2% from Monday last week, the Beijing News reported Tuesday, citing figures from the Beijing Municipal Commission of Transport. The commission had estimated that based on historical data following previous price increases, there would be a 10% drop in the number of passengers.
JOBS AND EVENTS *
Beijing Correspondent, Editorial job with GUARDIAN NEWS AND MEDIA expect to lots of turnover among the foreign media this year // Guardian News & Media are now looking for a Beijing Correspondent to report on China for all Guardian platforms, including daily news and analysis, news features, multi-media material, and material for non-news sections as required.
USAJOBS – Search Jobs CHINA SENIOR INTELLIGENCE OFFICER, Department: Department of the Navy Agency: Naval Intelligence Command, $120,749.00 to $167,000.00 / Per Year
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