The Sinocism China Newsletter 05.06.16

"Sinocism is the Presidential Daily Brief for China hands"- Evan Osnos, New Yorker Correspondent and National Book Award Winner

Today’s Links:

AnchorTHE ESSENTIAL EIGHT

1. China’s military deploys its first corruption inspectors | Reuters The official Xinhua news agency said the new graft inspectors completed two days of training on Wednesday and had been organized into 10 teams who would go to various units around the country. It did not say which units would get inspectors. Xu Qiliang, a vice chairman of the Central Military Commission, which controls the military and which the president heads, told the inspectors they were fulfilling an important role in cleaning up and strengthening the armed forces, Xinhua said.  // do they report into the CMC or into Du Jincai? Big difference

Related: 军委纪委举办派驻纪检组干部集中培训 – 中国军网 军报记者北京5月5日电(记者安普忠、欧阳浩)军委纪委派驻纪检组干部集中培训3日至4日在京举办。向军委机关部门和战区分别派驻纪检组,是习近平主席和中央军委在这轮国防和军队改革中做出的重要决策,是重塑我军纪检监察体系的创新之举。这次集中培训标志着军队派驻纪检组正式进入监督序列,标志着我军纪检监察体制改革又向前推进一步。中共中央政治局委员、中央军委副主席许其亮4日会见参加集中培训人员并讲话…军委纪委书记杜金才和副书记杨成熙、宋丹,军委办公厅领导等参加会见。

2. Big but brittle | The Economist special report package by the always worth reading Simon Rabinovitch // This report will argue that China is faced with two unpalatable options. One is that it moves more boldly to free up its financial system. That would be the right thing to do for the future but would release pent-up perils now; defaults would climb, banks would rack up losses and many shadow lenders would go bust. The other is that China eschews reform and instead tries to patch up its current system. That would be easier in the short term, but the inexorable accumulation of debt would sap the economy’s vigour and raise the spectre of a fearsome crash. In practice, the government has wavered between the two options.

Related: China Evicts Investment Firms Amid Fears of Unrest – Bloomberg China’s authorities, seeking to forestall potential social unrest due to growing failures of investment firms and online lenders, are ordering many to break leases and close their storefronts on busy streets — lest they become magnets for protesters. And that’s not all. Registration of all new companies with finance-related names was suspended nationwide in April, according to people familiar with the matter who asked not to be identified because they’re not authorized to speak publicly. In Shenzhen, office building management now must submit contact information for employees of all finance industry-related tenants to the local security bureau. Local governments from Shanghai to central Henan province have put up new signs outside residential compounds to warn the public against illicit fundraising activities.

Related: The biggest problem with China’s latest credit boom, charted | FT Alphaville To put it very simply simply, the credit boom is not reaching the real economy, it’s staying in an increasingly leveraged financial sector and it’s less effective than it was in 2009 — you can see credit growth and M2 moving together in the chart above, for example. Here’s Deutsche explaining the problem, which rests on a government keen to arrest slowing growth (which impacts bank profits too, of course) and a dearth of real investment opportunities in China

Related: CLSA Sees China Bad-Loan Epidemic With $1 Trillion of Losses – Bloomberg Nonperforming loans stood at 15 percent to 19 percent of outstanding credit last year, Francis Cheung, the firm’s head of China and Hong Kong strategy, said in Hong Kong on Friday. That compares with the official 1.67 percent. Potential losses could range from 6.9 trillion yuan ($1.1 trillion) to 9.1 trillion yuan, according to a report by the brokerage. The estimates are based on public data on listed companies’ debt-servicing abilities and make assumptions about potential recovery rates for bad loans.

3. ‘Whole world should unite to defeat the American invaders and their lackeys’: controversy sparked online by ‘red songs’ at concert in Beijing | South China Morning Post A concert that featured “red songs” praising the Chinese Communist revolution and Mao Zedong, staged in a style reminiscent of the Cultural Revolution, has sparked controversy online after it was held at the Great Hall of the People in Beijing. The show came at a politically sensitive time as the 50th year anniversary of the start of the Cultural Revolution approaches on May 16. The political mass movement created some of the most violent upheaval in China since the foundation of the People’s Republic in 1949.// Disturbing, showed up in Wechat feeds a couple of days ago, now all the commentary/reports deleted. [UPDATE: It looks like this show was not sanctioned and the producers may be getting into trouble]

Related: 文革号角再次吹响 人大红歌会齐唱“大海航行靠舵手” 【博闻社】以下是中共太子党、全国政协前副主席马文瑞的女儿马晓力致中共中央有关部门的一封信。信中反映五月二日在人民大会堂上演的一场红歌秀,这场红歌演出打的旗号是中宣部下属中心主办,实际上是一场地道的商业演出,每张票贵达1200多元。 更重要的是,这场演出所唱的歌曲,全部都是文化大革命中的流行歌,特别是开场所唱的竟是“大海航行靠舵手”这首臭名昭著的颂歌。再加上最近出现的吹捧习近平的两首歌。整个晚会充满了文化大革命的味道。有观者惊呼“文化大革命又开始了!”

Related: 紅歌演唱會被指文革復辟 中宣部等主辦 高歌《大海航行靠舵手》 – 明報新聞網 Prominent 2nd generation Red Nobility member Ma Xiaoli sent a letter to Li Zhanshu complaining about the performance, says it violates Party’s decision on the Cultural Revolution  //  演出落幕後,前全國政協副主席馬文瑞之女、在京紅二代中頗具影響力的馬曉力,隨即上書中辦主任栗戰書。她在信中稱,「以這種形式紀念文革發動50周年,完全不顧黨的政治紀律,完全違背黨的十一屆六中全會關於《建國以來黨的若干歷史問題的決議》精神!」馬曉力又稱「我們要引起高度警覺!警惕文革復辟和回潮,警惕文革極左思潮再次興風作浪。」35年前中央決議指出,文革是一場由領導者錯誤發動,被反革命集團利用,給黨、國家和各族人民帶來嚴重災難的內亂。對於這一全局性的、長時間的左傾嚴重錯誤,毛澤東負有主要責任。

4. 应对西方“网络自由”必须维护我国意识形态安全 2016年05月06日 15:04:39 来源:《红旗文稿》2016/09 作者:张卫良 何秋娟 – 网上空间也是国家的安全空间,没有网络安全就没有国家安全。4月19日,习近平总书记在网络安全和信息化工作座谈会上强调:要树立正确的网络安全观,加快构建关键信息基础设施安全保障体系,全天候全方位感知网络安全态势,增强网络安全防御能力和威慑能力。这一讲话对实施我国网络安全战略工程提供了基本遵循和重要指导。 //  article in latest Red Flag Manuscript on the need to safeguard ideological security to deal with Western “Internet Freedom”

5. China Announces Reforms to Salt Monopoly – WSJ The State Council, or cabinet, announced Thursday that while the government will continue to license salt producers and require them to add iodine to most salt, the companies will be free to set prices and distribution channels starting next year. Though the reform plan doesn’t do away with the monopoly—as some have called for—it does attempt to give market forces greater sway to bring greater efficiency and lower prices to a system that critics say has provided fat profits for what has been a powerful industry.

Related: The salt monopoly and the purpose of state-owned enterprises | Andrew Batson’s Blog For those interested in the intersection of obscure Chinese industries, regulatory politics and ancient history (you know who you are), the top story of the week is without question the long-awaited announcement of some reforms to liberalize China’s salt monopoly (here’s a news story and the original Chinese document). China’s salt monopoly is one of the best examples of a more general principle: state-owned enterprises are often used as a substitute for regulation.

6. The Chinese Mayor – YouTube Once the thriving capital of Imperial China, the city of Datong now lies in near ruins. Not only is it the most polluted city in the country, it is also crippled by decrepit infrastructure and even shakier economic prospects. But Mayor Geng Yanbo plans to change all that, announcing a bold, new plan to return Datong to its former glory, the cultural haven it was some 1,600 years ago. Such declarations, however, come at a devastatingly high cost. Thousands of homes are to be bulldozed, and a half-million of its residents (30 percent of Datong’s total population) will be relocated under his watch. // fascinating documentary

7. 冷溶:实现中华民族伟大复兴的科学理论指导和行动指南–理论-人民网 《习近平总书记系列重要讲话读本(2016年版)》(以下简称《读本》),全面准确地阐述了习近平同志系列重要讲话的重大意义、科学内涵、基本观点、精神实质和实践要求,阐述了党中央治国理政新理念新思想新战略。我们要认真学习习近平同志系列重要讲话的原文、原著,同时通过学习《读本》,进一步加深对系列重要讲话精神的理解和掌握,更加自觉地把思想和行动统一到系列重要讲话精神上来。

8. Toddler Jia Jia’s Death Highlights Autism Ignorance | Sixth Tone The district government of Panyu, an area of the southern Chinese city of Guangzhou, Guangdong province, told local media on Wednesday evening it would launch an investigation into Jia Jia’s death and the autism rehabilitation center where he was undergoing treatment. He died in late April, around one week short of his fourth birthday. The rehabilitation center is operated by Guangzhou Tiannaidao Nourishment and Health Consultancy Co. Ltd. but is known by the name “Heaven’s Way.” It’s run by self-taught health practitioner Xia Dejun, and it offers three-month residential courses involving strict physical exercise and diet to help children “recover” from autism.

AnchorBUSINESS, ECONOMY AND TRADE

China says risk in bonds of big state-owned firms ‘controllable’ | Reuters China’s state asset manager, in the wake of increasing debt defaults have rattled Chinese markets, on Friday called risk in bonds issued by central government-owned firms “controllable”. The State-owned Assets Supervision and Administration Commission (SASAC) said it made the conclusion after a detailed probe into all bonds issued by such enterprises. The investigations were launched after one firm, China Railway Materials Co Ltd, in mid-April sought suspension of trade in 16.8 billion yuan ($2.60 billion) worth of its debt instruments, as the company struggles to make payments.

Shadow Lending Crackdown Seen Forcing China Banks to Sell Bonds – Bloomberg A crackdown on banks hiding bad loans in China looks set to trigger a flood of capital raising just as global investors warn of risks to the financial system. New rules require lenders to make full provisions for loan rights they have transferred to other financial institutions, people familiar with the matter said last week. Banks will need to raise up to 1 trillion yuan ($154 billion) in capital over a number of years if the rules are applied to their total shadow lending exposure of about 12 trillion yuan, according to estimates from Sanford C. Bernstein & Co

Asset Management Subsidiaries of Fund Companies Are Punished-Caixin Citic-Prudential Asset Management Co., a subsidiary of Citic-Prudential Fund Management Co., was ordered to stop creating and selling any new asset management products for six months, starting in May. The order came from the non-profit Asset Management Association of China, which helps the China Securities Regulatory Commission (CSRC) oversee the industry. The CSRC punished three other fund company subsidiaries for violating rules in April. Citic-Prudential Asset Management said on April 22 it had been punished for running a “capital pool,” meaning the sources and uses of capital are not tied to any particular investors.

China tightens oversight of bank bill business after fraud | Reuters China has told banks to step up checks on their bill financing businesses to curb risks, after the sector was hit by several cases of bill fraud costing many millions of dollars. Chinese officials have warned against systemic risks as banks struggle to cope with rising bad loans as the economy slows. Some banks have suffered heavy losses due to lax internal controls and other irregularities in bill financing, the People’s Bank of China (PBOC) said in a document jointly issued with the China Banking Regulatory Commission (CBRC).

There won’t be a global recession—yet | Prospect Magazine Yet slowing growth is also an omen because one of these days, the credit boom is going end—probably badly. We can only guess at the timing. I predict that it won’t happen in the next three quarters, but within the next three years. In any event, as long as China is plodding along, regardless of whether it’s sustainable, industrial commodity prices and trade volumes should get some wind in their sales. Accordingly, we should expect countries in China’s commodity and export supply chains to improve too.  // George Magnus predicts a credit crisis within three years

Q. and A.: Arthur R. Kroeber on ‘China’s Economy’ – The New York Times The next party congress [in 2017] will be the revelatory moment. You could argue that Xi isn’t a dummy. He understands that the party’s ability to stay in power in the long run depends on getting the economy right. He realizes the need for significant changes to the economic structure, but faces so much entrenched resistance that he had to spend several years in a cleanup campaign to move aside people who might oppose economic reforms. Once he has consolidated political power and cleaned up the system, he can move from the political-discipline task to the economic let’s-get-the-system-running-better task. I’m not sure I’ll put my chips on that, but the next party congress is when we’ll know for sure whether Xi is a committed economic reformer, or someone who’s mainly just interested in political control.

Rail Operator Says Its Debts Have Risen to More than 4 Tln Yuan-Caixin China Railway Corp. (CRC) said it had debt of 4.14 trillion yuan as of the end of March, up 10.4 percent from the same period in 2015. The announcement appeared in a first quarter audit report written by a firm hired by the CRC. The report was posted on the website of the China Central Depository & Clearing Co. Ltd., the nation’s main state-backed bond clearinghouse, on April 29. The CRC reported a net loss of 8.73 billion yuan in the first quarter, up 35.1 percent year-on-year…Drops in rail freight were the biggest reason for the company’s losses. The amount of rail freight fell by about 10 percent in 2015 from a year earlier, the largest decline the country has ever seen, Sheng Guangzu, the CRC’s general manager, said earlier this year. He blamed the slump on fewer shipments of bulk commodities such as coal and steel.

China Names Finance Official Zhu to Key Leading Group Led by Xi – Bloomberg China named Vice Finance Minister Zhu Guangyao to a senior position in the Communist Party’s elite financial and economic panel led by President Xi Jinping, giving him a bigger role in shaping policies to help support growth. Zhu, 62, now also serves as a deputy director of the general office of the Central Leading Group for Financial and Economic Affairs, according to an April 28 article published by the Chinese Academy of Governance

Alibaba’s revenue soars, but new ventures hit profit | Reuters “Whatever they are doing must be working, and most importantly it’s a sign that the Chinese consumer may not be weakening quite yet,” said Gil Luria of Wedbush Securities. But, not all of Alibaba’s businesses looked rosy. Its online finance affiliate Ant Financial Services Group, one of founder Jack Ma’s crown jewels in his e-commerce empire, recorded a net loss in the quarter.

Central tendency | The Economist On May 1st the government extended VAT from the sale mainly of goods to all major service sectors, including construction and finance. It replaces a business tax based on gross revenues. Under the value-added system, companies may deduct many of their input costs. The VAT rate is higher (for example, 11% for property developers, compared with a business tax of 5%), but the deductions should end up saving them money. In this section Central tendency Charity ends at home Exterminate the foreign names The 15-year hitch Reprints Related topics China Taxes Public finance Value-added tax The move may reduce tax receipts by as much as 500 billion yuan ($77 billion) this year. It has led some analysts to characterise it as a fiscal stimulus to counter slower growth, since it will leave companies with extra cash to invest. Yet the short-term impact may be overstated.

Bicycle couriers in China’s own “logistics revolution” | Chuang For ten days starting on March 21st, Shenzhen traffic police began a massive crackdown on unlicensed motorized vehicles (mainly electric bicycles and tricycles) commonly used as taxis and to transport goods over short distances. 17,975 vehicles were impounded and 874 drivers were detained, leading to clashes with the police. This brought the plight of express couriers into mainstream news media.2 The brief article translated below is the first we have seen that attempts to go beyond the inconvenience caused by such crackdowns to investigate the changing work conditions of this increasingly important sector of China’s post-2008 economy.

China Seen Churning Out Most Steel Ever After Price Surge: Chart – Bloomberg Average daily output may have eclipsed the previous high of about 2.31 million metric tons in June 2014, said Paul Gait, a senior analyst in London. Producers ramped up supply as demand rebounded and prices jumped as much as 69 percent from their November low, generating the best margins since 2009.

住建部:将新建中小户型为主的租赁住房国内新京报网 5月6日,国务院新闻办召开制造业与互联网融合发展及住房租赁市场等政策吹风会,住房城乡建设部副部长陆克华在回应大城市租房紧张的问题时表示,将新建中小户型为主的租赁住房,满足青年人和新市民的租房需求。

China regulator studying impact of overseas-listed firms relisting in China | Reuters The CSRC is studying the market impact of overseas-listed Chinese companies relisting in the A-share market through IPOs, mergers and acquisitions, as well as restructuring, Zhang added. The regulator made the comments following rumors that it would block domestic listings by companies currently listed overseas, the Shanghai Securities News reported. “For companies already in the process of relisting at home, the faster they get done the better because regulatory uncertainties are rising,” said a banker, who declined to be identified because they were not permitted to speak to media.

AnchorPOLITICS AND LAW

Xi Jinping: the game changer of Chinese elite politics? – Contemporary Politics – Amidst China’s emergence as a global power, Xi Jinping is pushing through a range of ambitious reform plans that are reconfiguring both Chinese domestic politics and foreign policy. A fierce anti-corruption campaign has led to the dismissal of a large number of powerful figures, while a major effort has begun to bring party, state, and military power within Xi’s control. Many observers have interpreted these moves as radically altering the rules of game of elite politics, if not creating a personalistic political system. Our analysis shows that Xi’s corruption fighting and power centralisation represent part of his state-building project, in order to enhance the party-state’s capacity for the pursuit of governance objectives. We identify three rules regarding the Party’s power succession that would provide a critical test regarding how radically Xi is prepared to alter the Party’s key norms. The outcome of the 19th party congress in late 2017 would make it clearer whether Xi is in an effort to further institutionalise Party politics or turning the regime into his one-man rule.

近期省级党委副书记密集调整 多要职仍待补缺新闻腾讯网 中新网北京5月6日电(记者 阚枫)官方5日发布消息称,苟仲文出任北京市委副书记。今年2月以来,在新一轮的省部级高官人事变动中,已有多省份的省级党委副书记进行人事调整。受人事调整影响,目前仍有多地省级党委的要职待补缺。

曾任温家宝”首席智囊”的谢伏瞻如何当省委书记_网易新闻 生于1954年8月的谢伏瞻,现年61岁。河南是其仕途履历中第一次主政地方,2013年3月“空降”河南出任河南省委副书记(次月任河南省长)之前,各界均评价其为“专家型官员”,“国务院智囊”。 谢伏瞻曾两次荣获中国经济最高奖——孙冶方经济科学奖。两进两出国务院核心智囊机构智库。1993年8月至2006年10月在国务院发展研究中心工作13年,历任国研中心办公厅主任、国研中心副主任等职;2008年5月至2013年3月在国务院研究室工作近5年,担任主任一职。从国研中心到国务院研究室之间的“间隔”,也就是2006年10月至2008年5月,出任国家统计局局长。

How Should Global Stakeholders Respond to China’s New NGO Management Law? | ChinaFile Conversation The Party’s goal in moving forward with the Foreign NGO Law is clear: to increase its control over which domestic entities get funding (as well as other forms of international support), and for what. The move is very much of a piece with Xi Jinping’s overall governing strategy, a core component of which is to reassert Party control over key elements of Chinese society, including the media, the Internet, universities, and cultural producers. Given the very strict registration and approval requirements in the law, it seems clear that the Party wants to shape the long-term growth trajectory of Chinese civil society, to ensure that most of the cooperation with international groups happens through Party-approved—or even Party-controlled—entities.

FreedomInfo | China’s FOIA Turns Eight – Freedom Info Documents such as the State Council 2016 Open Government Work Priorities are important indicators of continued leadership attention to and emphasis on this work. The specific tasks assigned and reporting required are intended to incentivize all leading government officials, at all levels, to take them seriously. China has come a long way on its surprising and rocky road toward establishing a more open governance system for its people, thanks to a dynamic interaction between top-down policy and bottom-up demand. As the OGI Regulations enter their ninth year of implementation and face their first statutory overhaul in an extremely complex and evolving environment, realizing a “right to information” and open government more broadly will remain a challenging endeavor.

From Bench to Bar: Meet China’s Ex-Judges | Sixth Tone In China, being a judge means low pay, a high workload, and other hardships. Over the years, a small trickle of judges have decided to leave their courthouses. More recently, this trickle has become a steady stream, with some news reports even referring to an “exodus of judges.” Shanghai’s ex-judges keep in touch online, and from time to time they meet in cafeterias or on university campuses to share stories or, like today, join a seminar. This recently formed group has already grown to nearly 100 members.

AnchorFOREIGN AND DEFENSE AFFAIRS

China to join US-led naval drill in the last Rim of the Pacific | South China Morning Post Vice Admiral Joseph Aucoin, commander of the US Seventh Fleet, told journalists in Shanghai on Friday: “The PLAN [People’s Liberation Army Navy] will participate in an exercise, the largest exercise that we do, in a couple of months.” He was speaking after the arrival of his flagship the USS Blue Ridge in the commercial hub, just days after China denied a port call for a US aircraft carrier in Hong Kong.

Xi urges China, Russia to translate political ties advantage to more pragmatic cooperation outcomes – Xinhua Xi told Sergei Naryshkin, head of the State Duma, Russia’s lower house of parliament, that he and Russian President Vladimir Putin fully agreed on this need. The high-level development of the China-Russia Comprehensive Strategic Partnership of Coordination not only meets the needs of the two countries but also is in line with the global trend of peace, development and win-win cooperation, according to Xi. He called on the two sides to lay a more solid social and public opinion foundation for the long-term healthy and stable growth of China-Russia relations.

外交习语|两月内会见俄三政要 习近平怎么看中俄关系-新华网 新华网北京5月6日电 5月5日下午,国家主席习近平在人民大会堂会见俄罗斯国家杜马主席纳雷什金。这是习近平主席在不到两个月内第三次会见来华访问的俄罗斯政要。之前,他在3月25日和4月28日分别与俄总统办公厅主任伊万诺夫、外长拉夫罗夫会面。 习近平主席高频次地会见俄罗斯客人,向外界传递了什么信号?几次会见中,他对中俄关系发展又有何重要表态?

Disney CEO meets Chinese president ahead of Shanghai theme park opening | South China Morning Post Xi told Disney CEO and Chairman Robert A. Iger that it was important for the world’s “strongest” country, referring to the US, and the world’s largest developing country to deepen their cooperation and expand it into new areas. Cooperation between “US firms with Chinese firms, and in particular the Walt Disney Company with Chinese firms, are exactly cases in point of such new cooperation,” Xi said. “And I believe the new cooperation will continue to yield new outcomes.”

Why the Next Pearl Harbor Could Happen in Space-Newsweek This year, the Pentagon will spend $2 billion on measures to counter threats to its national security satellites. That amount is expected to soar as part of the $22 billion set aside to maintain U.S. superiority in space in 2017. Senior U.S. officials explain such large investments reflect the Pentagon’s recognition of a major shift in U.S., Chinese and Russian capabilities. For the first 25 years after the Cold War’s end, they note, America’s conventional forces were unmatched, thanks largely to the advantages their satellites gave them on the battlefield…But over the past 15 years, a period in which U.S. defense dollars were diverted to pay for the wars in the Middle East, China and Russia have developed advanced weapons that “challenge our advantages…especially in cyber, electronic warfare and space,” says Deputy Defense Secretary Robert Work. “As a result, our margin of technological superiority is slowly eroding.”

Language Log » Inspirational PLA Video “‘Just waiting for the order to kill, kill, kill’: China’s military tries to woo young recruits with slick video featuring rock and rap soundtrack” (5/4/16) After watching the toe-tapping video I was intrigued (i.e., the squirrel), found the lyrics online, and translated them (i.e., chasing the squirrel).  A copy of my (rough) translation is appended below, as are the source URLs

社评:给新征兵宣传片《战斗宣言》点个赞评论环球网 虽然有些外媒的评论带了点酸劲,但惊叹该片冲击力、抱怨所在国家和社会征兵宣传片“不够劲”的也不少。如今的解放军更公开地表示“准备打仗”,就像这部宣传片一开始朗诵的:“脑子里永远有任务,眼睛里永远有敌人……战争随时爆发,你们准备好了吗?”这一切为中国军队赢来的更多是尊重。

Hearing | Hearings | United States Senate Committee on Foreign Relations The Honorable Antony J. Blinken Deputy Secretary Of State

Commentary: Abe’s accusation of China’s “militarization” in South China Sea does not hold water – Xinhua As an outsider in the South China Sea issue, Japan has tried everything to get involved. However, such behavior has only led to more trouble on multiple occasions and is self-defeating; moreover, it has revealed Japan’s hidden agenda. During their recent visits to Europe and Southeast Asia, Japanese Prime Minister Shinzo Abe and Foreign Minister Fumio Kishida expressed “concerns” over China’s lawful and reasonable construction of civilian and public facilities on the South China Sea islands and reefs, describing it as “militarization.” The accusation from the Japanese side does not hold water. China’s construction is not targeted at any other country. Apart from minimum defense facilities, the buildings are primarily civilian in purpose, and serve not only China’s interests, but also those of coastal nations in the region and other countries around the world.

Germany Courts China | Foreign Affairs In the many conflicts that bedevil U.S.-Chinese relations, Germany has been able to steer a cautious middle course. There is indeed a global affairs lesson to be learned here on how to coexist peacefully: by having respectful, diplomatically fine-tuned, frank discussions, underpinned by a focus on mutual economic advantages and genuine attempts to include China into the international community. Furthermore, regular, institutionalized transatlantic consultations regarding China’s role in global affairs would also be beneficial. At present, such consultations between Washington and Berlin (or with other EU members) are the exception.

Daniel Russel Remarks at the JoongAng Ilbo-CSIS Forum 2016 Beijing’s frustration with Pyongyang’s behavior is palpable – and can you blame them? North Korea’s wanton disregard for China’s legitimate interests has enabled us to find important common ground. We worked closely with Chinese diplomats at the U.N. to pass Security Council Resolution 2270. Now I see two thought bubbles forming over you as I look from the podium. One asks – “but will China enforce it this time”? The other says, “another UNSCR…big deal.” OK, it’s too early to assess Chinese enforcement, but Chinese leaders say that they intend to fully implement 2270. We are seeing some important signs of follow-through, including announcements of new trade restrictions and inspections—but time will tell how real how and how sustained this is. And is 2270 just more of the same? I don’t think so. My contention is that we’ve never tried this level of pressure before.

Indonesia, Malaysia, Philippines reach agreement to coordinate maritime security – Asian Correspondent Indonesian President Joko Widodo met with Malaysia’s minister of foreign affairs, Anifah Aman, and Philippine secretary of the foreign affairs department, Jose Rene D. Almendras, to discuss the possibility of coordinating patrols around the Sulu Sea. The three officials hashed out details of joint patrols, including issues on how the exchange of information would take place between the three countries

China’s new passive assertiveness in Asian maritime security | Lowy Institute In this Report, Ashley Townshend and Lowy Institute Nonresident Fellow Professor Rory Medcalf examine China’s evolving maritime security conduct. They argue that China’s less confrontational but more strategically assertive behaviour has paradoxical implications for regional security, lowering the risks of unintended clashes but making it harder to prevent China from consolidating a new maritime status quo.

Xi Jinping’s Belt & Road Initiative: How to Win Friends & Influence Europeans | The Asan Forum Beijing attempts to exert influence in particular towards the eastern part of the European Union, which has a greater need of Chinese investment. China has already established a special forum to deal with the EU Eastern Member States and applicant countries, the “16+1.” The forum has its own secretariat within the Chinese Ministry of Foreign Affairs that organizes regular meetings. Countries that do not criticize China on human rights and that support China’s policies are rewarded with investments but also with visits of Chinese leaders, as was highlighted by the recent visit by Xi Jinping to the Czech Republic (although the visit also coincided with widespread protest against China’s treatment of minorities including Tibetans).

Philippine fishermen favor strong president to end China’s blockade | Reuters For key ally the United States, a Duterte presidency brings much uncertainty. A Washington-based official closely following the election said Duterte’s stance on the South China Sea appeared “contradictory”, mixing both bellicose and conciliatory messages about dealing with Beijing. Murray Hiebert, a Southeast Asia specialist at the Center for Strategic and International Studies, said Duterte’s comments did not seem well thought out, including pledging to negotiate with China but only after it agrees the Spratlys belong to the Philippines.

Common ground on the border- India Today Were India and China tantalisingly close to resolving the vexed boundary dispute when Atal Behari Vajpayee was prime minister, only for the unexpected 2004 electoral defeat to thwart plans? So suggests a new book by Dai Bingguo, China’s Special Representative (SR) in the over 15 rounds of boundary talks between 2003 and his retirement in 2013. In these 10 years, Dai negotiated with four different Indian SRs. He has never publicly spoken about the talks, but his book Strategic Dialogues, published in Beijing in late April (in Mandarin), for the first time lifts the veil on how Beijing has viewed the secretive negotiations.

《2016年征兵宣传教育实施方案》下发施行 – 中国军网 新华社北京5月5日电(记者张宝印、贾启龙)为充分调动全社会支持和参与征兵工作的积极性,激发广大适龄青年参军报国热情,中宣部、军委政治工作部、军委国防动员部近日联合下发《2016年征兵宣传教育工作实施方案》。 《方案》明确,2016年征兵宣传教育自3月份开始,持续至9月底新兵全部入营,以各级各类院校应届毕业生,特别是大学生为重点对象。各新闻单位、军地各级宣传部门和兵役机关,紧密结合征兵工作,有针对性地抓好三类活动。

China, Kazakhstan sign $2 bln in deals as Xinjiang party boss visits | Reuters China and Kazakhstan signed $2 billion in deals during a trip to the Central Asian country by the Communist Party boss of China’s far western region of Xinjiang, state media said on Friday, as China promotes its new Silk Road initiative.

FBI Tricked Naval Intel Officer Into Spilling Info, Lawyers Say | Foreign Policy Lt. Cmdr. Edward Lin, the U.S. Navy officer accused of spying for foreign agents, was entrapped by the FBI, his defense team alleges, and never passed sensitive military  information to Taiwan. Instead, he discussed the information with a Mandarin-speaking undercover informant. Larry D. Younger, Lin’s civilian lawyer, further said at Lin’s April 8 preliminary hearing at U.S. Naval Station Norfolk that Lin never admitted in 11 hours of interrogation to spying for Taiwan. The Pentagon for the first time made an audio recording of the hearing available to reporters Thursday.

Singapore, Australia Expand Military Partnership With Eye on China – WSJ City-state plans to send 14,000 troops a year down under as part of new trade and defense deal

Spotlight: Defamation, lies, big money true face of American democracy – Xinhua It is estimated that the spending in this year’s election will exceed 5 billion dollars, breaking the record of 2 billion dollars set in 2012 and becoming the most expensive one in U.S. history. To regain their lost “democracy,” thousands of activists held rallies and staged sit-ins outside Capitol Hill in early April to protest big money in politics and barriers to voting. But the week-long protests ended with the arrest of more than 400 demonstrators. In conclusion, today’s so-called American democracy is actually nothing more than an ill-disguised oligarchy in which defamation, lies and big money are rampant.

西式民主神话的破灭-——“民主之春”“黑夜站立”运动及其分析思考- 来源:《红旗文稿》2016/09 作者:祝念峰 近期,西方国家发生的两大政治事件令人瞩目。一是美国的“民主之春”抗议示威活动。抗议者队伍4月2日从象征美国独立的费城独立钟出发,步行10天抵达华盛顿,在国会山前集会示威,抗议金钱操纵美国选举以及政府的不作为,要求改善民主,结束金钱政治,保证公正选举。这一运动4月18日在当局的打压和媒体的漠视中黯然结束。二是法国的“黑夜站立”社会运动。该运动源于一场针对法国政府新颁布的《劳动法》改革方案的抗议示威。自今年3月31日晚在法国巴黎共和国广场开始,至今已持续一个多月。随着时间的推移,运动的主题逐渐扩展至社会治理、选举制度、难民问题、恐怖主义、金融资本主义等多个领域。目前整个运动已经从巴黎蔓延到了法国的70多座城市,且大有愈演愈烈之势。深入分析研究这两大政治事件及其深层次原因,有利于认清西方民主制度的本质,澄清一些模糊认识和错误看法。

AnchorHONG KONG, MACAO AND TAIWAN

Hong Kong retail figures ring up worst quarterly performance since 1999 | South China Morning Post However, the pace of the retail market slump slowed last month, as the 9.8 per cent plunge in March was less precipitous than in January and February, when sales contracted 13.6 per cent year on year. Retailers suspect they haven’t hit the bottom yet, despite better-than-expected mainland tourist arrivals during the “golden week” national holiday. The number of visitors from across the border climbed 7.1 per cent compared with the three-day break last year.

Hong Kong’s Short Squeeze – WSJ As of this week, anyone seeking director details or other information online from Hong Kong’s Companies Registry must declare a reason for doing so, at risk of legal penalty if found to be using the information for another purpose. News reporting and research aren’t listed as acceptable options. Officials say the new policy protects against abuse of company directors’ personal data, and that anyway “the right of public access to information will not be affected” because one of the options is broad enough to accommodate reporters and researchers. The Hong Kong Journalists Association isn’t convinced, warning that “the new arrangements will add legal risks to those working in news and to the public.”

AnchorTECH AND MEDIA

Vdisk, KuaiPan, and other Chinese cloud storage providers shut their doors-TechInAsia Dropbox, Google Drive, and other international cloud storage providers have long been blocked in China – and now a number of domestic storage services are facing a similar fate. Vdisk, KuaiPan, and UC net disk – run by Sina, Xunlei, and Alibaba, respectively – have filled the gap left by the government’s censoring of international options, but now each one is partially or fully closing down. Vdisk has posted a notice on its website saying that its free storage program will close on June 30 to comply with government regulations, and that users should download their documents ASAP. KuaiPan has posted a similar message. UC net disk (“UC cloud” in Chinese) is still up and running, but the Alibaba-owned South China Morning Post reports that the service’s cloud storage will be terminated entirely.

China launches crackdown on false internet advertising after outcry over student’s cancer death | South China Morning Post The campaign, which will run to November, is part of an action plan announced yesterday by the State Administration for Industry and Commerce to boost the ­protection of consumer rights. The administration urged all levels of industry and commerce to step up monitoring and crack down on false online adverts.

AnchorSOCIETY, ART, SPORTS, CULTURE AND HISTORY

《生于五十年代》-CCTV Documentary “Born in the 1950s” 对于中国人来说,二十世纪的第五十个年头,意义非凡。一个新生的国家,成立仅有几个月的中华人民共和国迈入崭新的五十年代,未来的岁月借用当时一首著名的诗歌比喻,就是时间开始了。开始的不仅仅是时间,还有新的生命。如果说新生的人民共和国为整个国家带来了新的希望,那么,这些在火红的五十年代出生的孩子们则给他们的家庭注入了新生的喜悦和活力。并没有相当精确的数字显示,在整个二十世纪的五十年代,中国到底有多少家庭孕育了新的生命,但是当今天的人们回头去审视历史时,都会把二十世纪五十年代这十年间出生的孩子统称为生于五十年代的中国人。他们出生的年代造就了他们的性格、经历乃至命运,他们此后的人生也即将被标注上许多共同的符号,乃至成为一代具有典型时代印记的中国人。

Yao Ming’s Biggest Game: Hoops Reform in China-Caixin One industry expert who asked not to be named said that some BCU members may bail out if club-CBA relations worsen. “Everyone wants reform,” said a BCU member, “but no one wants to confront the CBA.” The former Infront executive Ma can’t imagine a pro basketball league in China that isn’t controlled by the CBA. “The NBA has been established in a fully market-oriented society,” he said. “But in China, the leagues do not follow pure market behavior. It’s impossible to get rid of the CBA.” Unless the system changes, however, Yao and other team owners themselves may have to continue paying a heavy price for pro basketball in the country. A source close to the Shanghai Sharks said it loses about 20 million yuan a year. It was losing money when Yao, who once played on the squad, bought it in 2009.

Sports Regulator Says It’s Mulling ‘Lottery’ Linked to Domestic Soccer Leagues-Caixin Idea to let fans play a game based on picking outcomes of games in China has been sought by owners and sponsors of football clubs

Xinjiang to strengthen preschool bilingual education – Xinhua With central government funds, Xinjiang plans to offer three years of bilingual preschool education instead of the current two years in the region’s rural area during the 2016-2020 period, sources with the regional education authorities said on Friday. Xinjiang is aiming to ensure 85 percent of pre-school children across the region have access to such education in 2020. Seventy-seven percent of its preschool-age children attended bilingual kindergartens last year, according to official figures.

AnchorENERGY, ENVIRONMENT, SCIENCE AND HEALTH

Primate fate: Chinese fossils illuminate key evolutionary period | Reuters A treasure trove of fossils of six furry critters that inhabited the trees of southern China 34 million years ago is providing a deeper understanding of a pivotal moment in the evolution of primates, the group that eventually gave rise to people. Scientists on Thursday announced the discovery of the remains of six previously unknown extinct primate species: four similar to Madagascar’s lemurs, one similar to the nocturnal insect- and lizard-eating tarsiers of the Philippines and Indonesia, and one monkey-like primate.

漩涡中的莆田系“改革派”综合新京报网 “魏则西事件”中,媒体发现,陈新贤名下的上海康新医院管理投资公司是武警北京二院网络域名注册单位,陈新喜作为主要股东的上海柯莱逊生物技术有限公司是该院细胞免疫技术支持者。知情人士称,陈新贤属于莆田医疗系的改革派,但陈氏兄弟身上仍难脱开莆田系当年发家的路数。 // The Beijing News looks at the Putian hospitals

AnchorBEIJING

Beijing Authorities Again Take Aim at Property Prices in Tongzhou-Caixin Authorities in the capital have unveiled rules intended to further rein in the real estate market in the Tongzhou District, where prices have soared since last year after plans to build a center for government offices were announced. Beijing’s housing commission and Tongzhou’s government unveiled the new rules, which would target buildings in which units can be used for either office space or homes, on May 5. The rules limit purchases of apartments to unmarried buyers with household registration, or hukou, for Beijing who do not own a home in the city. The rules also let families who have already own a home in the capital to buy a property if they have Beijing hukou.

AnchorJOBS AND EVENTS

Work for CET | Job Openings | How to Apply CET Academic Programs is proud to provide management consulting services to Schwarzman Scholars, based at Tsinghua University in Beijing. In this capacity, CET seeks to assist in recruiting a talented team to implement and manage an unparalleled student life experience for Schwarzman Scholars. The inaugural class of Scholars arrives at Schwarzman College in the summer of 2016. The following positions are currently accepting applications.

ChinaPower: Launch | Center for Strategic and International Studies A discussion with Professor Joseph S. Nye, Jr. and Professor David Shambaugh Wednesday, May 11, 2016 | 3:30 PM – 5:00 PM

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