Xi Jinping has assumed China’s Presidency (Bloomberg). Today’s People’s Daily front page celebrating Xi’s ascension is a classic. Was People’s Daily Matt Drudge’s inspiration for his screaming red headlines?
Xi now holds the top three positions in China–General Secretary of the Party, Chairman of the Central Military Commission and President–after what turned out to be a relatively smooth and peaceful transition. Yes there was turmoil and infighting last year, but was it actually that much worse than in previous succession years? Or were the “normal” political machinations more exposed and amplified in the first succession in the Internet/Weibo era? I am not sure we can know the answer given the opacity of the political system.
China has never been so important to the world economy and global stability, and there are now orders of magnitude more China pundits and analysts clamoring for share of voice. Moderation tends to get lost in the noise, and it certainly does not make you famous.
Li Keqiang will become Premier today and by the weekend we will learn the rest of the major personnel appointments.
In 军工资产证券化再破冰 “强军梦”带来新机遇 National Business Daily takes an interesting look at the business of China’s military industrial complex and the opportunities to make money from the “strong military dream” part of the “China dream”. There is far too much money now to be made growing the defense budget for this trend to slow appreciably, even if slowing the military buildup made strategic sense for China, which it does not.
Much of Asia is following China’s lead, as Asia’s defense spending has now overtaken Europe’s for the first time last year, per the International Institute for Strategic Studies (IISS). At what point do militaries feel the need to make sure their new hardware works in real combat conditions?
CNBC Asia debuts a new show about China this afternoon at 5PM. Eunice Yoon will host the monthly “Inside China”. I am on today’s program, talking about Weibo, and will post a link once it goes online.
THE ESSENTIAL EIGHT
Austerity on Display at China Congress – WSJ.com On the other hand, Beijing’s austerity drive is starting to pinch the bottom line of businesses, especially high-end retailers that have traditionally thrived on gift-giving to officials.In the glitzy Sanlitun shopping and entertainment district, a Rolex store owned by a local sales agent for the Swiss brand was closed recently. A handwritten sign hanging on the glass door offered a phone number for enquiries. “We’re closing down the store because of lackluster sales,” said an employee who answered the phone, giving only her surname, Huang. Rolex SA declined to comment.
A Tide of Dead Pigs in China, but Dinner Is Safe – NYTimes.com Hard as it may be to believe, the recent discovery of thousands of pig carcasses floating in a river that supplies drinking water to Shanghai may represent an encouraging step forward in Chinese public health…as the authorities have cracked down on people selling diseased or dead pigs, agriculture experts say, it is possible that someone may have decided it was better to dump dead pigs into the river.
Xi Pivots to Moscow – By John Garnaut | Foreign Policy There are some close observers who believe, or hope, that Xi’s Moscow tour is designed to draw upon symbolism from the revolutionary era when his father was vice premier and China’s policy was “to lean to one side” in favor of the Soviet Union. “Xi will shortly execute China’s own pivot,” says one well connected observer who has a seat in one of the two legislatures that are meeting in Beijing this week. The observer says Beijing’s move toward Moscow is a response to Washington’s “military” pivot, just like when “the Western powers totally ostracized” China in the 1950s.//really? i do not know anyone who thinks China can trust Russia; just the opposite. perhaps this is wishful thinking by a “conservative”, as noted in article conclusion…interesting detail about li xiannian’s daughter li xiaolin
China Voice: “Beautiful China” campaign needs administrative awe – Xinhua | English.news.cn Undoubtedly, some businesses and people should be blamed for the lack of social responsibility as they have failed to observe environmental rules, but more blame lies in the governments at different levels for their often loose policies and insufficient supervision. Had some local governments not pursued GDP growth rate as their almost single target of work, factories that did not meet the standards on industrial waste discharge would not have had the chance to blossom across the country.
China’s new president in corruption battle – FT.com Daimler did not respond to requests for comment about the claims made by the supplier’s sales director about its Chinese joint venture. The executive said her company gave her Rmb20,000 ($3,300) for handouts during lunar new year, when cash gifts in red envelopes is traditionally given in a practice often used as a cloak for bribery. Even so, she said, she struggled to meet the ballooning demand for new year gifts from even lowly employees at the Daimler joint venture on the outskirts of Beijing. “The Germans only occupy the top layer of management, and everything below that is done by Chinese, the Chinese way. The Germans don’t know,” she said.//really, the Germans don’t know?
贵州茅台被指有机证造假滥用化学农药|茅台|造假_新浪新闻 Moutai responds to but does not really deny charges that its ingredients are not actually organic. this is a big and very symbolic scandal, on many levels. then again, the draw for Moutai is not that it is “healthy”..among the allegations, Moutai paid 5M RMB to get certified as organic…// 京华时报讯(记者胡笑红) 集“中国有机产品”和“OFDC有机认证”于一身的贵州茅台一直以酿造高品质白酒著称，然而昨天有媒体质疑贵州茅台酿酒原料以劣充好、“有机”涉嫌造假、滥用化学农药。对此，茅台昨天在其官网上发声明回应，但内容含糊其辞，未正面回应媒体的质疑。
Superbank Troubleshooter Role Cuts Risk to ’08 Low – Bloomberg The bond risk of China Development Bank Corp. slid to the lowest in more than four years on signs the lender will maintain government backing as it takes on some of the nation’s toughest challenges in 2013. The premium to insure state-owned CDB’s debt from non- payment for five years over the sovereign’s shrank to 14 basis points on March 12, the narrowest since October 2008, even as the so-called superbank granted loans to debt-laden urbanization and renewable energy projects. That’s down from as high as 149 in January last year, according to data provider CMA. Wells Fargo & Co. (WFC) pays 27 basis points more than the U.S. government on similar contracts.
Nearly 35% of Android Apps Are Secretly Stealing Private Data, Says China’s Latest DCCI Report android app market chaos a big google failure, especially in china. not sure fixable at this point// China’s awkwardly-named Data Center of China Internet (DCCI) released a new report on Wednesday about Android apps in the country, and things do not look good. The report details DCCI’s findings in an investigation of the top 1400 apps across China’s various Android markets and found that 66.9 percent of the apps were tracking users’ private data, and 34.5 percent of them were doing what DCCI calls “cross-border data tracking”; tracking private data that has no discernable connection to the app’s function and generally not making users aware that it’s happening.
BUSINESS AND ECONOMY
China Economic Watch | Local Government Financing Vehicles Under Fire Again If anyone suspected the new Chinese leadership would relax controls on local government spending in 2013, they were wrong. CBRC is preparing to issue the third installment of the now annual guiding opinion on monitoring the risk of local government financing vehicles (LGFVs). When released, the new draft will strengthen provisions for controlling bank lending to local government financing vehicles put in place in previous guiding opinions on the topic issued by CBRC in 2011 and 2012. New lending to LGFVs will be allowed under six conditions:
Cambridge Journals Online – Abstract – Low-income Housing in Chinese Cities: Policies and Practices This paper argues that the low-income housing programme in China has so far failed to provide adequate housing for the poor for three main reasons: the central government’s failure to define a clear mission; a lack of commitment from local governments; and an exclusionary policy towards migrants. A systematic review of low-income housing policy in China shows that the central government juggles its economic and socio-political goals thereby causing constant changes in low-income housing policy. Meanwhile, the existing public finance system, the performance evaluation system and localization in policy implementation have all resulted in a lack of commitment from local governments to low-income housing. Inadequate provision is made worse by problems with allocation. Despite encouraging changes since 2010, many factors underlying the government’s failures remain unchanged, thus the fate of low-income housing remains uncertain.
China Bad Bank Said to Plan $3 Billion Share Sale in Hong Kong – Bloomberg China Cinda Asset Management Co., one of four funds created in 1999 to buy bad debts from banks, plans to seek about $3 billion in an initial public offering in Hong Kong, said two people with knowledge of the matter. The state-owned asset manager may start the share sale in 2014, said one of the people, who asked not to be identified because the information is private. Cinda has yet to hire banks to manage the IPO, the people said.
Investors in China should be wary of revolution – Telegraph China is heading for a social revolution, according to Fidelity fund manager Anthony Bolton.
China’s Colossal Credit Bubble Next Big Risk: Marc Faber on CNBC” The economy in China will slow down and we may even have in certain sectors a recession… The question is about the future. I think China will still grow but there will be bumps along the road and political issues,” he added.
白岩松：仔细听 住建部长没说过房价会“向下走”_资讯频道_凤凰网 CCTV commentator Bai Yansong discusses the new real estate rules, points out that if you listen carefully the minister of housing doesn’t say prices will drop…government dancing on a knife edge…dropping prices will anger a large and important group of urban property owners…but not providing more affordable housing will anger a larger but less politically powerful group//你看，您再听，一会儿会让您再听一遍，我的感觉指的是政策新政策还会向下走，他说的并不是房价向下走，但是很多记者跟很多百姓太期待房价尽快向下走，所以把这句话解读成了大标题，房价会向下走，我觉得住建部长神通没有那么广大，已经可以直接决定房价就会向下走。不信您再听一遍。
政府投资审批有望向地方放权 新华社——经济参考网 在启动长达12年后，政府投资立法进程有望提速。全国人大代表、国务院法制办公室副主任安建接受《经济参考报》记者采访时表示，根据国务院机构改革和职能转变方案的总体要求，《政府投资条例(征求意见稿)》正在抓紧研究修改，投资审批权限有的要下放，有的要整合。多位受访的国家发改委专家告诉记者，从大方向上看，政府投资审批有望向地方放权，如适当加大地方政府的投资管理权限，适当减少中央政府投资主管部门的管理权限，原则上是“谁投资、谁决策”。
证监会今年拟全力净化A股环境 新华社——经济参考网 any evidence that the CSRC’s reform agenda will change with a new leader? or just speculation?// 无论是在基本制度完善、制度改革还是日常监管方面，种种迹象显示，2013年，在市场化导向之下，监管层正从多个方面着力于提高A股市场基石——上市公司的质量。在业内人士看来，通过新股发行制度改革、日常监管改进以及对利益关联方的制约，整体提升上升公司质量，净化A股环境，提高市场投资价值，将在未来一段时间成为中国资本市场的核心话题。
POLITICS AND LAW
China’s Billionaire Bubble Stands in Xi Jinping’s Way – Bloomberg Much is being made of how quickly Xi is replacing Hu Jintao in China’s fastest formal transfer of power in more than a generation. Although it took Hu almost two years to get all top three positions — president, Communist Party head and chairman of the military commission — Xi has them right out of the gate. The sense is that Xi has been empowered to rebalance an economy that’s producing a dangerous gap between rich and poor. That would sound more plausible if not for China’s billionaire bubble. The real big money in China isn’t in the private sector, but the public one//Pesek is vastly overstating this issue. in the eyes of the Party everyone is a peasant and will be treated as such if they get in the way of the wrong person or the broader goals. the billionaires for the most part know this, given the list of former billionaires now in jail.
人民日报-“伟大祖国展现出前所未有的光明前景” ——《政府工作报告》起草记 People’s Daily on the drafting process of the Government Work Report
洪振快：60年前政协委员议政风波-财经网 就这样，议政变成了批判。综观此次议政风波，值得注意的是，周恩来本来不觉得梁漱溟的发言有什么，了解毛的意见后，马上转变态度，不断加码批判；民主党派高层人士，除了李济深曾对梁表示赞同外，无人支持梁，除了几个人在批判中曾经表示沉默（如李济深、张澜、叶圣陶）外，很多人（如陈铭枢、史良、荣毅仁、许德珩、章伯钧等）则帮助中共批判梁；中共方面的参会者，则说“民主权利不给反动分子”。在如此高层次的国事会议上，60年后的今日，我们可以看到当日的议政水平，也可以看到当时的政治生态：中共提出的路线、方针、政策，即便在最高议政会议上，民主党派、党外人士也是不可以有反对意见的，提意见都有风险，稍表异议者如梁漱溟的遭遇已是如此，其他人想必心知肚明，自当引以为戒，明哲保身。 请注意，这是在1953年9月，建国还不到四周年，此时已是如此，以后的政治生态就不难理解了。 洪振快为历史学者、专栏作家
China’s anti-corruption bodies publicize working practices – Xinhua | English.news.cn The Central Commission for Discipline Inspection (CCDI) of the Communist Party of China and the Ministry of Supervision (MOS) have detailed their case investigation and appeal processes, according to a block diagram posted Thursday on the official website of the latter organization.//partial English translation here
FOREIGN AND DEFENSE AFFAIRS
Readout of the President’s Phone Call with Chinese President Xi Jinping | The White House The President underscored his firm commitment to increasing practical cooperation to address Asia’s and the world’s most pressing economic and security challenges. Both leaders agreed on the value of regular high-level engagement to expand cooperation and coordination. The President noted that Treasury Secretary Jacob Lew will visit China next week and that Secretary of State John Kerry will also visit Beijing in the coming weeks as part of his upcoming trip to Asia.
Maritime security: Dragons unite | The Economist But the reorganisation does not appear to indicate any change in China’s more assertive approach to maritime territorial issues. On March 12th a senior mapping official from the nascent coastguard’s ministry said China planned to send a surveying team at “an appropriate time” to land on the Diaoyu/Senkaku Islands. This would be a serious escalation. Officials from both sides have so far avoided setting foot on the uninhabited rocks. A commentary on a government website said merging the agencies would not mean stripping them of their powers. They would become, it said, an unstoppable dragon, “full of strength from head to tail”.
Beijing Cautions New Pope on Meddling in China – NYTimes.com Hua Chunying, a Foreign Ministry spokeswoman, said that Beijing hoped the pope, who was elected on Wednesday, would work with Chinese officials on improving relations. But, she said, the Vatican “must stop interfering in China’s internal affairs, including in the name of religion.” She also said the Vatican must sever diplomatic relations with Taiwan before ties with Beijing improve. China considers Taiwan a renegade province that is part of its territory.
Chinese senior official visits Fiji – Xinhua | English.news.cn Fiji’s Minister of Foreign Affairs Ratu Inoke Kubuabola (L) shakes hands with Liu Jieyi, vice-minister of the International Department of the Communist Party of China Central Committee, in Suva, Fiji, March 13, 2013. At the invitation of Fiji’s Minister of Foreign Affairs Ratu Inoke Kubuabola, Liu Jieyi is on his two-day visit to Fiji.
Rebels use China missiles to shoot down Syrian army helicopters | South China Morning Post Chinese-made missiles have been used to shoot down two Syrian army helicopters, state media reported on Thursday, adding their performance could boost the international sales appeal of Chinese weapons. The Global Times, a tabloid with close links to the ruling Communist Party, said a pair of videos posted on the internet by Free Syrian Army rebels showed two Mi-8/17 helicopters being shot down by Chinese shoulder-launched missiles.
TECH AND MEDIA
China Gains Tablet Foothold – WSJ.com There used to be a clear divide: Taiwanese contract manufacturers made the well-known tablets like Apple Inc.’s iPad, while Chinese companies made imitations for little-known brands. But with Hewlett-Packard Co.’s newest device, the line is blurring, a sign Chinese companies are becoming more serious competitors.To make its first Android tablet, the Slate 7, H-P—the world’s largest personal computer maker by shipments—passed over its usual partners and outsourced to China’s BYD Electronic (International) Co., said people familiar with the project who declined to be named because they were not authorized to discuss the arrangement
三大运营商围剿微信？ 腾讯：微信收费纯属谣传！_创业频道_一财网 3月14日上午，当广大网友的关注目光都集中在“两会”换届选举之上，但这时的腾讯深圳总部却没有闲着，因为近日有关“微信要收费”的新闻甚嚣尘上，让类消息让腾讯有些坐不住。《中国企业家》独家连线腾讯，在交流中腾讯高层希望透过《中国企业家》，正式辟谣，并正式宣称“有关微信收费的言论纯属谣传”。
China Mobile Network Costs Mean First Net Drop Since ’99 – Bloomberg“The company shifted 3G handset portfolio to low-tier devices to drive 3G subscriber growth during the fourth quarter,” Alen Lin, a Hong Kong-based analyst with BNP Paribas Securities Asia, said in an e-mail. Sales rose 5.3 percent to 151.8 billion yuan in the three months ended December, from 144.2 billion yuan a year earlier. The company was projected to report sales of 150.4 billion yuan, according to the average of five analyst estimates. Wireless data traffic last year became “a major driver of operating revenue growth” and almost tripled in volume from the previous year, Xi said in the statement. Sales from wireless data traffic last year rose 54 percent to 68.3 billion yuan, accounting for 12 percent of total revenue, he said.
SOCIETY, ART, SPORTS, CULTURE AND HISTORY
Reforming the one-child policy: Monks without a temple | The Economist Some experts say that scrapping it would make little difference in practice. Surveys show that many parents in the cities want only one child anyway. But political leaders still fear that such a reform would result in a sudden burst of population growth, and so far they have held fast, despite the pleas of demographers. “It’s not necessary,” says Zuo Xuejin, of the Shanghai Academy of Social Sciences. “We don’t need the policy any more.” Mr Zuo believes the next step should be to allow all couples to have two children. But that may still be too radical for the leadership.
Chinese slump dents global art market in 2012 |Industries |chinadaily.com.cn wonder how much corruption crackdown played a role// Auction sales in China dropped an even steeper 30 percent, pushing it into second place in the art market rankings with a 25 percent share behind the United States, which regained its position as market leader with 33 percent.
ENERGY, ENVIRONMENT AND HEALTH
Spin of a Crooked Record – Caixin Hundreds of villagers in Hebei Province discovered they were victims of identity theft – and in demanding officials find the culprit, they became the recipients of harassment and legal bills. Instead of seeing a shakeout, the villagers watched environmental authorities and local courts give shelter to the assessors responsible for blatant fraud. In 2009, officials in Panguanying village, near Qinghuangdao, announced that nearly seven hectares of land would be seized by the government for development. By the end of the year, when construction had already begun, the villagers learned that the land would be used for a massive waste incineration project. Nearby villagers were angry that they had never been informed of the actual purpose of the project and its potential impact. They found out that the provincial environmental protection bureau approved the project earlier that year, with an assessment report that contained their signatures.
Producers to benefit from Chinese price hikes–Interfax As China moves closer towards reforming gas prices, Simon Powell, the head of Asian oil and gas research at CLSA, talks to Interfax about the incoming reforms and their likely effects on one of the world’s largest gas markets.
Exclusive: Chinese firm puts millions into U.S. natural gas stations | Reuters With plans to build 50 stations this year alone, ENN joins a small but formidable group of players — including Clean Energy Fuels Corp (CLNE.O) and Royal Dutch Shell Plc (RDSa.L) — in an aggressive push to develop an infrastructure for heavy-duty trucks fueled by cheap and abundant natural gas. Clean Energy is backed by T. Boone Pickens and Chesapeake Energy Corp (CHK.N). The move is yet another example of China’s ambition to grab a piece of the U.S. shale gas boom. Just last month, Sinopec Group said it would pay $1 billion for some of Chesapeake’s oil and gas properties in the Mississippi Lime shale.
海水淡化百亿投资盛宴开席 massive desalinization investment “feast” about to begin// 据中国水网消息，国家发改委日前印发《关于公布海水淡化产业发展试点单位名单（第一批）的通知》，多个城市、工业园区及海岛等入选，并提出要大力发展海水淡化产业。这是去年底国家出台《海水淡化产业“十二五”发展规划》后的首个配套政策。
Chinese Healthcare Deals in Short Supply – Deal Journal – WSJ While U.S. healthcare companies seeking growth are eyeing Chinese firms, don’t expect a slew of big deals anytime soon, said participants at the China Healthcare Investment Conference in Shanghai.
Sinovac vaccine meets study goal; shares jump 60 percent | Reuters China-based Sinovac Biotech Ltd said a late-stage trial of its experimental vaccine for hand, foot and mouth disease (HFMD) met the main study goal of preventing the infection in infants between the ages of 6 months and 35 months. The Sinovac stock jumped as much as 60 percent in early trading, making it the top percentage gainer on the Nasdaq. About 5 million shares changed hands by 1041 ET, nearly 85 times their 10-day average volumes.
Chinese Vitamin C Makers Fixed Prices, U.S. Jury Says – Bloomberg Chinese vitamin C makers illegally fixed prices in the U.S., a federal court jury found, rejecting an argument the companies were acting under their government’s control and handing their customers a $162.3 million verdict. The jury of five women and two men, after deliberating for half a day in Brooklyn, New York, found that the American dietary supplement firms that brought the antitrust lawsuit proved the Chinese companies acted voluntarily in setting the prices. The jury awarded damages of $54.1 million, which were tripled to $162.3 million under U.S. law.
FOOD AND TRAVEL
Chinese overseas shopping hits record high – Xinhua | English.news.cn Tax refund service provider Global Blue said on Thursday that the amount of Chinese tourists’ overseas shopping it has handled hit a record high in 2012. Arjen Kruger, chief marketing officer of Switzerland-based Global Blue, said the company handled 24.4 billion yuan (3.9 billion U.S.dollars) worth of goods Chinese consumers bought overseas last year, a 58-percent year-on-year surge.
JOBS AND EVENTS
China-Latin America Relations: Challenges of Complementarity – Georgetown – Washington DC | Georgetown Wednesday, March 20 at 3:00pm to 4:30pm Edward B. Bunn, S.J. Intercultural Center, 302-P 37th and O St., N.W., Washington. For over a decade trade and investment relations between China and Latin America have flourished. China and many of its new Latin American partners, especially in resource-rich South America, have emphasized the complementary, win-win nature of the relationship. But the honeymoon period between China and Latin America appears to be coming to a close as some Latin American countries, such as Brazil, become increasingly worried about rising commodity dependency and as China faces rising anxiety over increasingly unstable relations with countries like Venezuela. This talk by Matt Ferchen will explore the background and implications of this important and evolving set of political and economic relationships.