The Sinocism China Newsletter 02.09.15

In case you missed it, the second Sinocism weekend commentary edition featured Dr. Rogier Creemers’ Ideology Matters: Parsing Recent Changes in China’s Intellectual Landscape.

Today’s Links: 

THE ESSENTIAL EIGHT *

1. In J.P. Morgan Emails, a Tale of China and Connections – WSJ JP Morgan will at worst get a slap on a wrist and an immaterial fine…just the cost of doing business, and not even that expensive…May be more interesting to watch what these revelations mean inside China //  Mr. Gao is the son of China’s current commerce minister, who, when his son faced a layoff, said he would be willing to “go extra miles” for the bank if it kept him on, according to a J.P. Morgan executive’s email account of a dinner with the father. The bank’s decision to hire Mr. Gao was widely understood within J.P. Morgan to have been supported by William Daley, a senior executive at the time, according to the internal bank emails, which were reviewed by The Wall Street Journal. Mr. Daley is a former U.S. commerce secretary and White House chief of staff.

Related: Fei Chang Dao: Baidu Begins Censoring Results Connecting Gao Hucheng’s Son Gao Jue to Morgan Stanley Gao Hucheng (高虎城) is the head of China’s Ministry of Commerce (商务部). His son’s name is Gao Jue (高决). Morgan Stanley (摩根大通) is a large investment bank. These screenshots show that at some point on February 7th or 8th, 2015, Baidu began censoring search results for “Gao Hucheng Morgan.”

2. Top Chinese Company Bosses Try to Atone After Bribery Allegations – WSJ It’s unclear whether the fact no one is being publicly fingered for the problems atop key state-run companies suggests the party is satisfied the public shaming is enough punishment or whether it’s lightening its approach to violations. But what’s clear is the officials running the businesses have spent time in the party’s version of a confessional booth  //  way too early to say this..usually takes weeks/months from CCDI inspection tour reports to detentions of anyone senior

Related: 新华时评:国企内外勾结围猎国有资产已到明火执仗地步|煤炭|国资改革|国有企业新浪财经新浪网 Xinhua commentary in wake of recent CCDI inspection reports, compares SOE corruption to termites  //  对于国企腐败问题,中央的态度十分明确;坚持从严治党,国有企业不能例外。2015年,巡视这柄反腐利剑已指向国企。中央决定,加大对国企巡视力度,实现对中管国有重要骨干企业巡视全覆盖。通过巡视等有效措施,一定要清除这些“国企蛀虫”,依据党纪国法严肃处理,公之于世,给人民群众一个交代。同时,要通过改革堵塞制度漏洞,加强监管,从体制机制上减少“蛀虫”,从根本上维护国有资产不受损失。

Related: Party Finds China Shipping Group Executives Helped Relatives, Own Firms Win Business – Caixin Company bosses also found to have embezzled assets, leader of inspection team says in report, and problems related to promotions were uncovered

3. China to pilot rural land use reform – Xinhua The State Council has passed a draft decision that will enable rural construction land to have the same rights and market price as state-owned construction land in some areas. The draft decision, pending authorization by the National People’s Congress, was passed during an executive meeting of the State Council presided over by Premier Li Keqiang on Friday. According to the draft, in places where pilot reforms will be carried out, the use right of existing collectively-owned rural construction land can be transferred, leased and traded for shares. It will be given the same rights and price as state-owned construction land when traded in the market.

Related: 土改试点部署浮现 方案保守步调谨慎政经频道财新网 试点将在国家新型城镇化综合试点地区和58个全国农村改革试验区部署,国土部也有自己的试点;土改分歧仍比较大,方案保守,步调谨慎

4. In China, Quantum Communications Comes of Age – Caixin This may be a quantum leap year for an initiative that accelerates data transfers close to the speed of light with no hacking threats through so-called quantum communications technology. Within months, China plans to open the world’s longest quantum communications network, a 2,000 kilometer electronic highway linking government offices in the cities of Beijing and Shanghai. Meanwhile, the country’s space scientists are preparing a communications satellite for a 2016 launch that would be a first step toward building a quantum communications network in the sky. It’s hoped this and other satellites can be used to overcome technical hurdles, such as distance restrictions, facing land-based systems.

5. China Net Regulator Rejects ‘False Allegations’ Amid Complaints – Bloomberg Business “Cyberspace is shared by the entire international community,” Lu Wei, minister of the Cyberspace Administration of China, said at the agency’s Chinese New Year reception today. “We need to support each other rather than doing each other’s job, and we need mutual respect rather than making attacks or false allegations.” Lu spoke days after 17 groups including the American Chamber of Commerce in China wrote a letter to U.S. Secretary of State John Kerry and other government officials saying that Chinese standards for “secure and controllable” technology would require foreign technology firms to submit to intrusive testing and hand over source code.

Related: China’s Undermining an Open Internet – POLITICO Magazine 3 US officials weigh in  //  J. Michael Daniel is a special assistant to the president and the cybersecurity coordinator at the National Security Council. Ambassador Robert Holleyman is the deputy trade representative in the Office of the United States Trade Representative. Alex Niejelow is the chief of staff to the U.S. intellectual property enforcement coordinator within the Executive Office of the President.

Related: Trade Groups Urge U.S. to Push Against Chinese Regulations – NYTimes.com In a letter addressed to key United States officials, including Secretary of State John Kerry, Treasury Secretary Jacob J. Lew and Commerce Secretary Penny Pritzker, 17 trade groups headlined by the United States Chamber of Commerce urged the government to push back against the Chinese policies, according to a copy of the letter viewed Thursday by The New York Times. The letter called for the United States government to take “immediate action to work with Chinese officials to reverse an alarming number of troubling, new Chinese government policies impacting the information and communications technology (ICT) sector.”

6. A Mandate, Not a Putsch: The Secret of Xi’s Success | The Jamestown Foundation The key to Xi’s success is likely not a sudden power play, but a decade-long effort to create elite consensus on the most difficult questions facing the Party. In short, Xi was given permission to be a transformative leader. A new review of speeches and writings made during his rise shows that he laid out a platform for his presidency long before being chosen for the job. His selection, therefore, represented a mandate for many of the radical changes he continues to push through. Some elements of this mandate were publicly stated as Xi took office: many key decisions made at the Third Plenum decision were foreshadowed by Hu Jintao’s outgoing Work Report in 2012, a document that requires the approval of much of the Party’s top echelons // good to see more observers coming around to this view, though we should rule out the likelihood that Xi is taken said “consensus” perhaps much further than expected, especially when it comes to the corruption crackdown. And his apparent fast consolidation of power over the security and military services should allow him to continue that approach if he wants, as it looks unlikely anyone who is “resisting” can muster anything remotely strong enough to change his trajectory. It is worth noting that Bo Xilai and General Gu Junshan went down under Hu Jintao, and that the first big Zhou Yongkang crony to be detained–Li Chuncheng–was officially taken away December 5, 2012, less than 3 weeks after Xi became General Secretary. And we shouldn’t be surprised if Xi’s unexplained absence in September 2012 has a lot to do with what has followed…

7. Q. and A.: Andrew Small on the China-Pakistan Relationship – NYTimes In his book, “The China-Pakistan Axis: Asia’s New Geopolitics,” Mr. Small argues that although China has long been close to Pakistan — thanks in part to shared mistrust of India — there have always been irritants below the surface. The presence in remote areas of Pakistan of the East Turkestan Islamic Movement, founded by separatists from the Uighur ethnic minority native to the western Chinese region of Xinjiang, is especially troubling to Beijing. China is suspicious, he says, that elements in the Pakistani Army harbor sympathies for the Uighurs.

8. Hangzhou Police Are Alibaba’s Thugs, Webmaster Says after Detention – Caixin “One of the officers told me that we (the company) don’t have the right or it’s not our job to criticize Alibaba for selling counterfeits and products without copyright clearance,” he said. After his release, Xiang wrote an article on WeChat, the popular messaging app where the posts critical of Alibaba also appeared, with the title: “We condemn the Hangzhou police for acting as a thug for Alibaba in getting into a case in another province.” The eastern city of Hangzhou is home to Alibaba’s headquarters. Xiang said that the police officers warned that Alibaba could get rid of a company like Shenzhen Dimeng in a minute. He wrote: “‘Do you have any idea who is behind Alibaba?’ they asked. ‘If we told you, you would be scared to death,’ they told me.”

 

BUSINESS, ECONOMY AND TRADE *

China’s imports slump, capping dismal January trade performance | Reuters China’s trade performance slumped in January, with exports falling 3.3 percent from year-ago levels while imports tumbled 19.9 percent, far worse than analysts had expected and highlighting deepening weakness in the Chinese economy. Largely as a result of the sharply lower imports – particularly of coal, oil and commodities – China posted a record monthly trade surplus of $60 billion. The data contrasted sharply with a Reuters poll which showed analysts expected exports to gain 6.3 percent and the slowdown in imports to slow to 3 percent, following a better-than-expected showing in December. The poll had also forecast a trade surplus of $48.9 billion.

SEC, Big Four Accounting Firms in China Settle Dispute – WSJ A joke. China wins this dispute, investors lose  //  The Chinese affiliates of the Big Four accounting firms agreed to pay $500,000 each to settle a yearslong dispute with the Securities and Exchange Commission over their reluctance to give the agency documents about Chinese companies under investigation. The settlement also allows the firms to avoid a temporary suspension of their right to audit U.S.-traded firms—a potential outcome of the dispute that would have complicated life for dozens of Chinese companies and many U.S. multinationals with significant operations in China.

Is the $1tn China carry trade imploding? | beyondbrics But now, Lubin said, all is in flux. The three foundations of the “carry” story – the likelihood of renminbi appreciation against the US dollar, sustainably low US dollar funding costs and a vibrant Chinese shadow financial system – have fractured. “All three of the factors that were sucking money into China are now weakening,” he said. However, none of this means that a disorderly unwinding of $850bn in short-term borrowings is necessarily in prospect. With $3.84tn in foreign currency reserves, “a large speculative outflow from China can easily be financed by the central bank,” Lubin says.

China Economic Watch | China’s Current Account in 2014 China’s large current account surplus and huge foreign exchange stockpile give it a big foundation with which to prop up the economy in the event of any economic surprises.  However, China’s capital and financial account deficit was $96 billion in 2014.  What to watch for is the RMB, because as GDP growth falls, and as the property market and heavy industry continue to struggle, the leaders may look for new places to create a stimulus, as they did when they cut the reserve requirement ratio (RRR) for banks on February 4th.  The RMB has risen with the dollar compared to the currencies of China’s emerging market trading partners, so if exports start to ease up, many expect the RMB to depreciate further against the dollar.  The RRR cut will also put depreciative pressure on the RMB as interest rates drop.  A depreciating RMB should increase exports, but they may also slow imports, increasing the trade surplus, which could push the current account past 3 percent of GDP.

Behavioral Macro | Why we misinterpret Chinese RRR cuts The reason the RRR cuts have taken on less meaning in the current context is that they have been mostly offsetting the diminution of China’s balance of payment inflows. Once upon a time China’s trade surpluses were so large and the capital inflows so strong that BOP inflows provided more than enough base money to fuel any amount of credit expansion the China authorities desired. In fact, there were excess inflows that China had to sterilize. Now the trade surpluses have diminished and the speculative inflows have cooled (in fact, we have even seen net outflows at various point in time). If RRR were not cut, there would be an effective tightening of liquidity conditions. (This diminution of BOP inflows is also why the Chinese have been buying fewer US Treasuries.)

Closer Look: Despite Property Downturn, Developers Still in Love with Soccer – Caixin Real estate companies continue to use the sport to raise their profiles, and must love that government is backing the game’s development

China to Crack Down on Tax Collection From Multinational Companies – NYTimes The State Administration of Taxation said that it would be looking in detail at how companies move money and allocate costs among their Chinese operations and their overseas businesses. Although such a review could also be applied to the many Chinese businesses that have set up holding companies in the Cayman Islands and elsewhere to avoid taxation, accountants said the main target of the latest initiative appeared to be foreign-owned firms. “The focus right now is multinationals’ paying their fair share of taxes,” said Howard Yu, a corporate tax partner at PricewaterhouseCoopers in Beijing. He added that the Beijing office of the national tax agency had set up an international division with an emphasis on auditing multinationals.

Seventy Chinese listed firms affected by far-reaching anti-graft campaign so far | South China Morning Post Chinese media has compiled the names of listed companies that lost top executives or underwent restructuring as a result of the country’s far-reaching anti-corruption campaign. Last year, some 70 listed companies were implicated in President Xi Jinping’s fight after graft, The Beijing Times reported. Many of these firms were under the control of friends of formerly powerful Communist Party officials, it said.

Twice As Many Expatriates Leaving China Than Arriving, Moving Company Says – WSJ The U.S., still the top supplier of expats to China, saw 22% fewer people move there in 2014 compared to a year earlier. For the second year in a row, more people moved out of China to the U.S. than vice versa, according to the company’s data, though that doesn’t necessarily mean the population of Americans in China is shrinking. While U.S. executives and other multinational employees may be leaving, the country has seen a recent influx of younger workers, many of whom move to China on their own and thus wouldn’t show up in UniGroup’s stats.

New York’s Baccarat Hotel Fetches Record Valuation From Chinese Buyer – WSJ Sunshine Insurance Group Co. is paying real-estate mogul Barry Sternlicht ’s firm and a partner more than $2 million a room for the Midtown Manhattan property, according to people familiar with the matter. One person said the valuation beats the previous record set by the Plaza Hotel, the New York landmark that was sold in 2012 to India’s Sahara Group for $2.04 million a room, according to hotel data tracker STR Analytics.

No pay raise for China’s underperforming SOE – Xinhua SOEs under the supervision of China’s State-owned Asset Supervision and Administration Commission (SASAC) will set basic gross profit and value added targets this year. Another target, 15 percent higher, will be used to judge their performance, according to an announcement by SACAC. Enterprises which set much lower targets than in previous years will be automatically rated “mediocre” and no increase in total salary bill will be allowed.

E-Commerce Sales in China Will Reach $1 Trillion By 2019 Thanks To Mobile, Says Forrester | TechCrunch A new report by Forrester finds that online spending in China will reach one trillion dollars by 2019. The growth will be fueled by mobile apps and improving logistics networks, which have helped e-commerce companies reach new customers in smaller cities.

 

POLITICS AND LAW *

Party mouthpiece accuses artists of colluding in graft | South China Morning Post A signed commentary in People’s Daily warned that an increasing number of celebrated artists and cultural intellectuals were using their fame to collude in corruption with the powerful and the wealthy. The warning by the Communist Party’s flagship newspaper on Monday could point to a widening of the anti-graft campaign to include the cultural and entertainment sectors.

近千”红二代”聚北京:反腐胜仗一个又一个国内新闻_社会万象十堰秦楚网 十堰新闻门户网站 十堰日报 十堰晚报 由革命后代组成的红色社团:北京延安儿女联谊会、北京开国元勋文化促进会、中共党史人物研究会井冈红军人物研究分会、新四军研究会、西花厅联谊会、红岩儿女联谊会、北京西路军后代联谊会、东北军爱国将士后代联谊会、北京中直育英同学会、北京八一学校校友会、北京育才学校校友会、北京十一同学会等,2015年2月3日相聚在北京八一电影制片厂召开了新春团拜会。

Tearful Communist mayor pleads for forgiveness as corruption purge rages on – Telegraph Ji Jianye was the mayor of Nanjing and a political high-flier until he fell foul of president Xi Jinping’s campaign against corruption in October 2013 and was placed under investigation. In images broadcast by state television on Friday, Mr Ji, who went on trial last month accused of taking more than 11 million yuan (£1.15 million) in bribes, appears to break down as he is pressed to discuss his alleged crimes. He reaches into his left pocket and produces a crumpled tissue with which he wipes his eyes.

Made in China: Fake IDs – NYTimes.com The number from China has increased steadily in the last few years, said Bill Rivera, chief of the International Mail Branch at Kennedy International Airport, where officers seize a package almost every day. From October 2013 to September 2014, 4,585 Chinese-made counterfeit IDs were intercepted, most headed to college students. “Quite frankly, some of them look pretty good,” Mr. Rivera said.

We Read Xi Jinping’s Book So You Don’t Have To | Foreign Policy Want to woo Chinese officials but don’t have the time? Take this quiz on the president’s book, then toe the Party line in style.

Mining Tycoon Liu Han Executed – China Digital Times (CDT) Mining tycoon Liu Han was executed Monday, after being sentenced to death last May on 13 charges including leading illegal gang activities. Liu was an associate of disgraced security chief Zhou Yongkang and was reportedly especially close to his son Zhou Bin, who, like his father, is under investigation for corruption

社评:袁贵仁讲话“争议”的几点厘清评论环球网 一些激烈反对声还是出现在了互联网上,这值得深思。它反映了高校宣传思想工作自身的复杂性,也反映了互联网舆论场用传统逻辑无法解释的变幻能力。比如党刊是在党内做政策宣示和动员的阵地,这里有一套话语。而互联网舆论场已经另外形成一套话语,前一个体系的正常表述被摘取一两句带进后一个体系,其含义很容易被夸张、引申和扭曲,被人为制造出强烈的刺激。这为发泄各种长期情绪或挑战权威不断创造由头。 有些境外势力借助互联网随时变换在中国舆论场的存在方式,如何在每一个具体场合准确评判这个问题,干扰性因素非常多。

In Video, Communist Party Vows It Wants to Fulfill Your Dreams – NYTimes.com Perhaps you want an attractive wife? Or to open a little restaurant? Maybe blue skies and clean water? Or, less modestly, a world without war? Be assured: The Chinese Communist Party and its 83 million members are rooting for you. That is the theme of a slick, three-minute promotional video for the party that has spread on Chinese websites in recent days.

Chinese official calls for cultural, ethical progress – Xinhua Senior Chinese official Liu Yunshan on Saturday called for efforts to bolster core socialist values and promote cultural and ethical progress while seeking economic growth. Liu, a member of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee, stressed the need to strengthen the education of socialism with Chinese characteristics and the idea of the Chinese dream among the public. People’s confidence in the country’s independent “path, theory and system” should be further boosted, Liu said at a conference held by the Central Spiritual Civilization Development Steering Commission.

Xi declares war on global gambling firms – Business Insider Chinese President Xi Jinping has officially declared war on the global gambling industry, warning foreign casinos that Chinese citizens will be gambling much less in China, neighboring countries, and the US.

山东枣庄落马市委书记被指与谷丽萍关系密切新闻腾讯网 山东省枣庄市委原书记陈伟1月被免职,其悄然离开枣庄,连枣庄市委工作人员都不知其去向。据悉,其曾被称为“山东最年轻市长”。

Banking Giant HSBC Sheltered Murky Cash Linked to Dictators and Arms Dealers | International Consortium of Investigative Journalists In a reflection of the sheer variety of names in the data, others who appear are Li Xiaolin, the daughter of former Chinese Premier Li Peng, famous for his role in the Tiananmen Square massacre; Joseph Fok, a judge on Hong Kong’s highest court, and Prince and Princess Michael of Kent, the beloved cousin of Queen Elizabeth II of England and his wife.

刘鹤任国家发改委党组副书记_新浪新闻 Liu He now the deputy secretary of NDRC Party Committee // 楚天金报讯 据中新社电 据国家发改委网站显示,刘鹤已任国家发改委党组副书记。1月30日下午,国家发展改革委党组副书记、副主任刘鹤同志主持召开委内改革工作会议,传达中央全面深化改革领导小组第九次会议精神,学习贯彻习近平总书记重要指示,总结全委2014年改革工作,部署2015年改革工作。据公开资料显示,刘鹤是十八届中央委员,此前担任国家发展和改革委员会副主任、党组成员。

 

FOREIGN AND DEFENSE AFFAIRS *

China Flies Its Largest Ever Drone: The Divine Eagle | Popular Science New images of testing materials have emerged of China’s largest ever UAV, the secretive Divine Eagle. Compared to other Chinese aviation projects like the J-20 stealth fighter and Y-20 heavy transport aircraft, the lack of publicly available photos of the Divine Eagle suggests that like the American RQ-180, this giant drone is a strategic and sensitive asset. Given the presence of official diagrams and wind tunnel testing, the Divine Eagle is likely to be a real Chinese project, built by the “black project” division of the venerable Shenyang Aircraft Corporation.

Data Breach at Anthem May Lead to Others – NYTimes.com The company, which operates under a series of Blue Cross plans in states like California, Connecticut and New York, is working with federal investigators to determine the source of the attack. Some signs continued to point to China, which has previously been thought to target health care companies, although the investigation is still in its early stages. If Chinese hackers are responsible, it raises an immediate and hard-to-answer question: Are they acting on behalf of the government? Or are they independent actors, seeking to sell the information they have obtained?

China seeks private sector help to streamline bloated army – FT.com “The government wants to get the private sector into this area essentially because they want to spend their military budget more efficiently,” said Yue Gang, a retired PLA colonel. “Introducing competition from the private sector and breaking up the monopoly of the previous military factor groups means that they will get more bang for their buck, and better high-allocate resources.” While the reform was initially announced at the National People’s Congress in November 2013, the PLA set up a website last month to handle procurement tenders and to make the process more transparent. Until then, only a few private companies sold to the PLA, according to Col Yue, and in limited categories of goods, such as bulletproof vests and armoured limousines. Now the reform has opened the gates to dozens, even hundreds, of companies.

China’s Diplomatic School Ranks “Top 20” American China Experts Using Complex Quantitative Metrics | Andrew S. Erickson For those lacking the time to review all the text, here are the top 20 experts mentioned; together with any Chinese names or transliterations thereof, and “final [overall] scores” (最终得分), ascribed to them:*  //  does this list take into account influence on US government policy? At least one of the people on the list is known for complaining about being shut out of Obama administration consultations

Sri Lanka backs China port city deal after threat to cancel | Reuters Cabinet spokesman Rajitha Senaratne said President Maithripala Sirisena would, however, discuss arrangements over the freehold of land to be used when he visits China in March. Sri Lanka’s neighbor India has raised concern over security threats posed by Chinese ownership of the freehold of 20 hectares of land next to the main commercial port in Colombo. India uses Colombo as a transshipment port.

Interview: US-China cooperation stronger than ever before: fmr ambassador – Xinhua Former U.S. Ambassador to China Gary Locke on Saturday expressed confidence in the future of U.S.-China relations, noting that bilateral cooperation is “stronger than ever before.” “The world is looking for the partnership between the United States and China to solve many of the problems,” Locke told Xinhua in an exclusive interview before delivering a speech titled “Vision and Hope for the United States and China” at the University of Southern California.

State Media Says Islamic State Executed Three Uyghurs – China Digital Times (CDT) The three were among 120 members of the Islamist militant group killed for desertion over the past six months in Iraq and Syria, the Global Times reported. The report cited an unnamed Kurdish security official as providing the information.

Gov’t Said to Name Three to Silk Road Fund Leadership Team – Caixin Jin Qi, 59, an assistant to the governor at the People’s Bank of China, will be the Silk Road Fund’s chief executive, a person with knowledge of the matter says. Wang Yanzhi, who heads an investment unit at the State Administration of Foreign Exchange (SAFE), will be the general manager of the fund. Zhu Surong, governor of the central bank’s branch in Urumqi, in the far western region of Xinjiang, will be a member of the board of directors.

Ruling the PLA According to the Law | The Diplomat Chinese authorities are revamping the military legal system to promote the rule of law and weed out corruption.

President Xi Clears the Way for Military Reform: PLA Corruption, Clique Breaking and Making, and Personnel Shuffle | The Jamestown Foundation Promotions, building a base of support within the military, and the threat of corruption investigations all enhance President Xi’s control over the military and increase the chances of full implementation of his military reform plan. However, an additional important reason for the PLA personnel shuffle is to break up ground force cliques within the MRs that oppose some of President Xi’s military reform proposals, and have also obstructed MR adjustments and the creation of joint commands in the past. The making of cliques to support President Xi and the breaking of cliques opposed to aspects of his military reforms should pave the way forward for real change within the PLA. These moves during the past year are likely the precursor to start implementing these sweeping changes proposed in the military reform plan.

北京消息:解放军两上将 疑涉徐才厚被查_中国-多维新闻网 有香港媒体引述北京消息人士透露,前年7月卸任国防大学校长的王喜斌上将和去年8月卸任副总参谋长的侯树森上将,也因牵涉徐才厚案,目前正被调查。

How Ancient Chinese Thought Applies Today | Kevin Rudd This essay is adapted from an address to the 9th International Symposium on Sun Tzu’s “Art of War” convened by the Chinese Academy of Military Science in Qingdao, China in 2014.

President Xi of China to Make State Visit to Washington – NYTimes President Xi Jinping of China is set to make a state visit to the United States later this year, his first since becoming the top leader of Asia’s biggest economy. No date has been set yet for the visit, Cui Tiankai, China’s ambassador to the United States, told reporters over the weekend, according to the official China Daily newspaper.

 

HONG KONG, MACAO AND TAIWAN *

Chinese Students Go Ballistic at Model UN Event | Thinking Taiwan A delegation of Chinese students at the Harvard Model United Nations held Jan. 29 to Feb. 1 made a dreadful discovery when they cracked open this year’s conference handbook. What they saw was so offensive that they made a scene, and several members of the group ended up being expelled from a meeting. Two words were at the heart of the kerfuffle: Taiwan and country.

A Recording of FP’s Interview With Taipei Mayor Ko Wen-je | Foreign Policy The interview quickly set off a flurry of coverage and controversy in Taiwan, as well in mainland China. In particular, reports have focused on this passage: “For the [world’s] four Chinese-speaking regions — Taiwan, Singapore, Hong Kong, and mainland China — the longer the colonization, the more advanced a place is. It’s rather embarrassing. Singapore is better than Hong Kong; Hong Kong is better than Taiwan; Taiwan is better than the mainland. I’m speaking in terms of culture. I’ve been to Vietnam and mainland China. Even though the Vietnamese are seemingly poor, they always stop in front of red traffic lights and walk in front of green ones. Even though mainland China’s GDP is higher than that of Vietnam, if you ask me about culture, the Vietnamese culture is superior.”

 

TECH AND MEDIA *

Qualcomm nears $1 billion deal resolving China antitrust dispute: source beyond the fine, will Qualcomm be forced to change royalty rates and licensing terms, and how might that help/hurt Chinese handset makers when it comes to patent indemnifications?  //  Qualcomm Inc (QCOM.O) is likely to pay China a record fine of around $1 billion (0.66 billion pounds), ending a 14-month government investigation into anti-competitive practices, after the U.S. chipmaker and the regulator made significant progress during talks last week. The deal, which may also see Qualcomm lower its royalty rates by around a third on patents used in China, could be announced as soon as Monday, a source said. Discussions in Beijing over one of the most contentious cases under China’s 2008 anti-monopoly law have intensified in recent weeks, culminating in meetings between Qualcomm senior executives and National Development and Reform Commission (NDRC) officials on Friday.

Alibaba Bets $590 Million on Becoming Smartphone Player – Bloomberg Business Alibaba’s investment in Meizu Technology Corp. gives the e-commerce giant a key tool in its push to unlock more money from China’s half a billion smartphone users. Along with the proposed minority stake in Zhuhai, China-based Meizu, Alibaba gains a platform for its homegrown operating system, YunOS, the companies said in a statement.  //  Alibaba’s yunOS is not a “homegrown” mobile OS, it is an Android fork. Why don’t journalists push back on Alibaba PR on this point?

Inside the Chinese Bitcoin Mine That’s Making $1.5M a Month | Motherboard Last October, Motherboard gained access to a massive, secretive Bitcoin mine housed within a repurposed factory in the Liaoning Province in rural northeast China. The mine we visited is just one of six sites owned by a secretive group of four people, part of a colossal mining operation that, as of our visit, cumulatively generated 4,050 bitcoins a month, equivalent to a monthly gross of $1.5 million.

MyCoin Exchange Disappears with Up To $387 Million, Reports Claim Adding to the mystery are reports the company never operated as a genuine bitcoin business at all. Testimonies from customers describe an operation more like a Ponzi scheme that used the veneer of bitcoin trading as its lure.

Can a closed internet be good industrial policy? | Andrew Batson’s Blog So here’s the big question: are these folks right? Is blocking global internet companies from offering all their services in China actually a good industrial policy, that is justified because it helps foster Chinese internet companies? And would this in turn mean that the Great Firewall, paradoxically, allows for more innovation and competition in the internet globally, because it is not dominated by an American oligopoly? I think this worth actually thinking about rather than dismissing out of hand. As much as I would like to be able to use my Gmail more easily, it’s not obviously the case that everyone in China would be better off if there was in fact no big domestic internet sector and everyone just used Google.

Technology’s next 25 years belong to the world, not the US – FT – Mike Moritz In the first decade and a half of this century non-US (and non-European) tech companies have advanced further than anyone could have imagined. Today, six of the 20 most valuable internet companies are based in China and China Mobile is by far and away the world’s most valuable carrier. Huawei threatens Cisco in most countries outside of the developed west while Samsung’s consumer electronics business is being assaulted by several Chinese and Indian companies.

A New Era at The Nanfang Begins Today | The Nanfang We remain proudly based in South China with writers located all over the world. While our coverage will expand across the entire nation, we also plan to beef up coverage in our own backyard. This is where most of us live and work, so it’s close to our hearts. Plus, it’s the most beautiful part of China (yes, I’ll debate you on this in the comments).

 

SOCIETY, ART, SPORTS, CULTURE AND HISTORY *

China’s Fog Weighs Heavily on Shoulders of Its Premier Architect Wu Liangyong- NYTimes Now 92, Mr. Wu has responded to the growing problems of China’s great cities by publishing a new master plan for the capital area, hoping to promote his longstanding idea of linking it with neighboring Tianjin and the smaller cities of Hebei Province. It is an idea he has pushed for 25 years, but it now has strong government backing after the Chinese president, Xi Jinping, endorsed it last year. Mr. Wu has also been the subject of two recent museum retrospectives, and continues to play the role of arbiter of major projects.

Rolling In It | ChinaFile How one might best translate “Bling Dynasty” into Chinese, I have no real idea. (Maybe “A Possessor of Uncouth Wealth,” Tuhao wangchao (土豪王朝), “Era of Dazzlement,” Liangxia shidai (亮瞎时代), or even the more straightforward “Bling Dynasty,” Buling-buling chao (不领不领王朝). But, whatever translation one might choose to use, the reign of this new dynasty, so graphically and strikingly depicted in the photographs and short videos shot by Lauren Greenfield for a feature by this name that recently ran in GQ, has gripped this errant “people’s republic” like a fever.

The Bro Code | ChinaFile In late 2013, a series of police raids, public closures, and new instructions to officials began to shut down spaces previously essential to business. I assumed, at first, that the crackdown efforts would be limited to Beijing and Shanghai, like many other campaigns, and to a few other key towns like Dongguan, long infamous for the sex trade, which saw a massive raid last February. Reaching out to contacts in Chengdu, Chongqing, Tangshan, Shijiazhuang, and Harbin I found the same story: officials were terrified of being seen at establishments where they had previously been welcome guests. A long-established business norm was now, at least for anyone with ties to the government, a dangerous hobby. But what had drawn them there in the first place?

China official’s son beats man to death in dog attack row: Report – AFP The son of a Chinese official beat a man to death in a dispute over compensation after his dogs bit the victim, state media reported Monday, in a case sparking outrage online.

 

ENERGY, ENVIRONMENT, SCIENCE AND HEALTH *

China Fights Pollution with Transparency – The New Yorker During a lecture at the Yale Center Beijing on Tuesday, the environmental campaigner Ma Jun explained how radical disclosure can pressure governments to be honest about enforcement. In 2006, Ma and his organization, the Institute of Public and Environmental Affairs, used publicly available data to create an interactive water-pollution map that highlights polluting firms around the country. They later launched a similar map for air pollution. Now almost all of China’s provincial governments have created platforms to disclose data online about local factory emissions, though data quality and reporting speeds vary. The government of Shandong province has gone so far as to publish a monthly list of violators. “I was really impressed,” Ma says. He credits China’s Ministry of Environmental Protection for taking the lead on transparency. “We need to give them credit for doing that. It’s not easy.”

Q. and A.: Matt Ferchen on China and the Price of Oil – NYTimes.com Matt Ferchen is an associate professor of international relations at Tsinghua University in Beijing and a resident scholar at the Carnegie-Tsinghua Center for Global Policy. His latest research focuses on China’s energy sector and its political and economic ties to emerging economies. In an interview, he discussed how the decline in oil prices would affect China’s relations with other countries and its transition to a more energy-efficient future.

India v China: Airpocalypse | The Economist India’s poor fuel standards, poor-quality vehicles and badly planned cities help to explain why so many of its cities are choked with awful air. Even China, notorious for problems with smog and pollution, appears better off than India.

Gov’t Efforts to Provide Clean Water for Rural Areas Fall Short – Caixin For years Beijing has said it is working to secure safe supplies of water to people in the countryside, but experts say a lot still needs to be done

 

BOOKS AND LITERATURE *

Mo Yan’s ‘Frog’ – NYTimes.com a careful reading of both “Frog” and “The Dark Road” will reveal that these two novels are perhaps not so divergent in their conclusions about the contemporary People’s Republic. Both describe a country that has lost its way, a land in which a repressive state has rendered individuals incapable of making independent moral judgments about political, economic and social behavior and in which women continue to suffer at the hands of reckless male politicians and son-fixated husbands. // the book on Amazon 

 

BEIJING *

Radar used to bust unauthorized basement construction in Beijing – Xinhua and then what? some of the biggest courtyard houses are owned by very powerful people.  //  Radar was used to detect unauthorized basement construction in Beijing as the city gets tough on the potentially dangerous practice. The crackdown comes after a lawmaker built a basement in his courtyard that caused neighboring houses to collapse, local authorities said Friday. Radar detection has been employed to monitor whether there are any hollowed areas under roads or houses. According to the office in Xicheng District responsible for the crackdown, law enforcement can use radar to check renovated houses.

China Focus: Beijing district to ease residency permits for migrants – Xinhua Beijing will pilot a “point system” in east suburban district of Tongzhou to allow its migrants to claim permanent resident permits or “hukou”. The system was included in the comprehensive pilot plan for promoting new-type urbanization released Wednesday by the National Development and Reform Commission (NDRC), China’s top economic planner. According to the district government of Tongzhou, it will adopt a “point system” for migrant people in the district based on various criteria including stable employment, accommodation, social security, and duration of residency, etc..

Zaha Hadid unveils plans for world’s largest airport terminal in Beijing – AP The Beijing New Airport Terminal Building, designed in collaboration with airport planners ADP Ingeniérie (ADPI), will initially accommodate 45 million passengers per year.

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