The Sinocism China Newsletter For 10.19.12

Just links today:

BUSINESS AND ECONOMY

China eyes tepid rebound as data signals worst over | Reuters – China likely hit the bottom of a seven-quarter long economic downturn between July and September, but the slowest three months of growth since the depths of the financial crisis and a cloudy housing market outlook make recovery prospects tepid.

Charting China’s Economy: The Third Quarter – China Real Time Report – WSJ – With growth showing signs of stabilizing, Ms. Wang, the UBS economist, cautions not to expect China’s new leaders to push the stimulus button when they start to take over the reigns in November.

NBS: Local Stimulus “Far Less” than Planned-Caijing – Local governments are expected to pour much less money than planned after the proposed projects really kicks off, said the National Statistics Bureaus spokesman Sheng Laiyun, playing down worries of another round of 4-trillion stimulus seen in 2008 which was blamed for problems from inflation to bubbling deficits.

Economists React: China Growth Slows, But Other Numbers Up – China Real Time Report – WSJ – other September data released Thursday were more positive: Industrial output growth rose 9.2% year-on-year, up from 8.9% in August. Exports saw a big rebound, growing 9.9% after 2.7% in August. Retail sales growth also accelerated, and inflation fell.

Questions over China’s Int’l Investment Position – Caixin – Since the second half of last year, China’s forex reserves have shown a month-on-month decline several times. Some experts believe that this is partly because domestic companies and individuals have started keeping more U.S. dollars in their accounts. There have been signs of stronger capital flows out of China, which many economists and regulators believe is the result of heavier Chinese investments overseas. Chinese nationals and companies have been the main force driving recent capital outflows, a SAFE official said. In fact, “our analysis has found that the amount of withdrawal of foreign investors’ investment principals has fallen compared to one year before.

Of China, the yuan, inequality and the euro | FT Alphaville – Either way, Chinese capital flows over the next while will be very interesting. And — as we have written about before and are reminded of again by BNY Mellon’s Neil Mellor on Thursday — whatever is happening will have real repercussions for the euro

To Renminbi Or Not to Renminbi? – By Victor Shih and Susan Shirk | Foreign Policy – Victor Shih and Susan Shirk// If China reforms its core institutions to overcome these doubts, its currency will become a major global reserve currency and China will have arrived as a genuine global power. Yet despite Beijing’s hopes, the world seems to be a long way from RMB dominance.

国务院:第四季度将制定收入分配改革总体方案|国务院|经济形势|温家宝_新浪新闻 – State Council to formulate income distribution reform plan in Q4

从垄断企业利润着手 缩小收入差距_财经频道_一财网 – First financial on going after monopoly profits, and not just wages/benefits, to help shrink the income gap. heard somewhere that central SOEs wages+benefits are on average 4x greater than overall urban average…// 对于抑制垄断行业薪酬,研究收入分配的相关学者的态度是,这样做固然有利于缩小收入差距,但更为有效的方法,应是在其利润方面着手

Buyers fear commercial housing presale traps – Xinhua | English.news.cn – After moving to the apartment in Beijing’s Chaoyang district in May, Zhou and her family started feeling uncomfortable and fell ill frequently. They decided to move out temporarily and rent another home. Professional home inspectors checked the home Zhou bought and found that the levels of formaldehyde gas emitted by the furniture in her home exceeded normal levels. She purchased the home about three years ago at a price of more than 100,000 yuan (about 15,867 U.S. dollars) per square meter.

上海百亿公积金“援建”保障房 全国试点城市已批419亿_财经频道_一财网 – there may be more funding available for subsidized housing than some of the bears think//

Beijing-Based Builder Buys Lot in First for a China Firm – Bloomberg – Sam Zell was an early investor in Xinyuan. As was Blue Ridge Capital. Bloomberg mentions later in the article that Zell also investing in Brooklyn but does not make the connection//Xinyuan Real Estate Co. (XIN) last month bought the 2-acre (0.8- hectare) parcel at 421 Kent Ave. in the Williamsburg section for $54.2 million, said Omer Ozden, who advised the company on the purchase

China Investment Drives Pickup in Challenge to Leaders – Bloomberg – The accelerating investment that helped to drive a pickup in China’s economy last month shows how Communist Party officials have failed to shift the nation’s growth model, leaving a challenge for new leaders.

Tesco Stumbles With Wal-Mart as China Shoppers Buy Local – Bloomberg – Tesco’s China pullback reflects the hurdles global big box retail chains face in Asia, where the realities of complex local markets and slowing economies are damping dreams of easy expansion. The world’s largest retailer, Wal-Mart Stores Inc. (WMT), is also adding outlets more gradually than it had planned in China’s 3.5 trillion yuan ($560 billion) grocery industry.

Variable interest entities in China | China Accounting Blog | Paul Gillis  I wrote a guest article for Forensic Asia, a Hong Kong based independent research firm that is 100% owned by Dr Jim Walker of Asianomics. This article consolidates much of my work on VIEs.

 

POLITICS AND LAW

Village democracy: A revolution fizzles | The Economist – the hope-based, contemporary commentary about this event overwhelmed by reality// But some Wukan villagers lament that their revolution has failed to live up to its promise. On September 21st, the anniversary of Wukan’s first big protest, more than 100 residents gathered outside the village government’s offices to complain. They claimed the new leadership was slow in getting back the land Wukan had lost as a result of the former administration’s corrupt dealings. Plainclothes security officers were deployed to keep an eye on the protest and police cars patrolled the streets.

Traditional means of controlling public no longer work |Society |chinadaily.com.cn – “lessons” from Weng’an getting good play in Chinese media..another sign of downgrading of politics & law committee at 18th, serious moves to more enlightened “social management”?// Traditional means of exerting control and pressure on the public have lost their effectiveness in stabilizing society, the Party chief of Weng’an county has said.Sha Xiangui, Party chief of Weng’an county in Southwest China’s Guizhou province, was speaking to People’s Daily about the lessons learned from the violent protests in the county in 2008, when the government was attacked by thousands of angry locals.

十八大前纵论新政治道路 舆论先行造势_多维新闻网 – 【多维新闻】被称为定调十八大的胡锦涛“7•23”讲话,随着换届大会的临近,在一阵解读热潮过后再度成为各界关注的焦点,其中政治体制改革引起的讨论尤盛。在主流舆论层面,以党报《人民日报》、党刊《人民论坛》、《求是》为代表,纷纷纵论“新政治观”,谈政治道路何去何从。在民间舆论场,大声疾呼政改甚至断言“大则危及中共执政”的声音也是接连不断。

Surprisingly, China’s newspapers criticise detention for dissent | Reuters – not sure it is this big a deal// Chinese government-controlled newspapers have openly criticised the detention of a village official who called for the end of Communist Party rule,

断网删帖不可取 微博管理靠法律-中国青年报 –

传播中的社会冲突、民主实践与应激式改革——以“郭美美事件”为例_学术研究_求是理论网 – 总之,民主不是一劳永逸的制度建设或民众参与的形式要求,而是一种源于人民头脑、心理和行动的主体意识和经济利益诉求。如果人民在政治层面的民主参与只表现在事件的发现以及围观的数字影响力,与此同时,经济层面的民主诉求并没能被纳入到政治民主参与的讨论对象与过程之中的话,那么有可能,一个由人民最先发现的问题最终会在人民分散性围观下被精英话语对围观情绪的征用中背离人民的根本利益归属与期待。

BBC News – China’s New Leaders

U.S. man suspected of raping teen–Shenzhen Daily – this could get very ugly// According to the investigation, McDowell picked up some girls at a bar in Luohu’s Guomao area on the night of Sept. 23. After several drinks, police said, he took a 16-year-old girl away from the bar and raped her… Several expatriates who knew McDowell and refused to be identified said he had lived in cities including Shenzhen and Dongguan for years, and very often hung out at bars and clubs in the Guomao area. His line of work involved trade between Shenzhen and the United States.

 

FOREIGN AND DEFENSE AFFAIRS

WTO hands Obama victory in U.S.-China steel case | Reuters – at least we are all still working within the WTO// The World Trade Organization barred China on Thursday from imposing duties on certain U.S. steel exports

Huawei May Surface in U.S. Review of Softbank-Sprint Deal – Bloomberg – Huawei is a year-round Christmas gift for lobbyists, lawyers and PR firms// Softbank’s relationships with Huawei Technologies Co. and ZTE Corp., China’s two largest makers of phone network equipment, probably won’t kill its $20.1 billion bid for 70 percent of Sprint, said Stewart Baker, a former U.S. Homeland Security Department official. It’s likely, though, that U.S. officials will address those connections when they scrutinize the deal, he said.

White House denies Huawei investigation report – The Hill’s Hillicon Valley – “The White House has not conducted any classified inquiry that resulted in clearing any telecom equipment supplier as reported in Reuters,” Hayden said in an e-mail. “In October of last year, Huawei was excluded from taking part in the building of America’s interoperable, wireless emergency network for first responders due to U.S. Government national security concerns,” she added.

Those Islands Belong to Taiwan – By Yung-Lo Lin | Foreign Policy – The Republic of China’s foreign minister lays out the case for Taiwanese sovereignty over the Diaoyutai Islands.

China to conduct exercise in East China Sea – Xinhua | English.news.cn – The Chinese navy will conduct a joint exercise in the East China Sea with the country’s fishery administration and marine surveillance agency on Friday, navy sources announced on Thursday.

Commentary: Shrine-worshipping exposes Japanese rightists’ show of militarism – Xinhua | English.news.cn – Right on the heels of Japanese opposition leader Shinzo Abe’s visit to the notorious Yasukuni Shrine, two Japanese ministers and a group of lawmakers followed suit on Thursday, in what appears to be an ugly show of militarism by rightwingers.

Japan and China: Rattling the supply chains | The Economist – In contrast to 2005, the previous time anti-Japanese riots flared, China is not the only fast-growing, well-populated, low-cost market around. Back then, Japanese firms hedged their China risk with a “China-plus-one” strategy, implying that they would find an extra Asian supply hub, such as Thailand. Now, that has grown into a wider “China-plus” strategy, because their options these days have widened to include Indonesia, Myanmar, Vietnam, Cambodia, the Philippines and India.

India and China: Unsettled for a long time yet | The Economist – how many of the Indian border posts have tennis courts?// Fifty years after a nasty high-altitude war, a border dispute remains unresolved

CIA seeks to expand drone fleet, officials say – The Washington Post – how will US react when China starts deploying armed drones?// The CIA is urging the White House to approve a significant expansion of the agency’s fleet of armed drones, a move that would extend the spy service’s decade-long transformation into a paramilitary force, U.S. officials said.

Chinese dissident Yu Jie granted asylum in U.S., plans a website for imprisoned Nobel laureate – The Washington Post –

 

TECH AND MEDIA

Galloping Horse Rides into Hollywood Venture – Caixin – Zhong’s dream came true. Later that day, her team and an Indian partner, filmmaker Reliance Media Works Inc., won the bidding for visual effects business Digital Domain Media Group. Their US$ 30.2 million offer snagged a company started in 1993 by superstar director James Cameron and the late special effects guru Stan Winston

The Unspoken Rules of Venture Capitalists in China | 创业家网 – The cover story of the current issue, “The Gingko Predicament,” discusses the intrepid work of Gingko, a large VC firm. At the outset, Gingko lures small entrepreneurs with the promise of high prices and tells them not to talk with other investors. But after the entrepreneur actually rejects other investors, Gingko often refuses to invest for any number of reasons. Such a practice can really put entrepreneurs in trouble.

The Gingko Predicament: Small Entrepreneurs in the Eyes of Venture Capitalists | 创业家网 – is Gingko Sequoia China?// This venture capital can send you to heaven, so the company has achieved the power to make you withstand purgatory.

Shaking Up Beijing’s Taxi Market – Economic Observer Online – In-depth and Independent – with Apps// Beijing’s strict limits on the number of taxis have caused a huge gap between demand and supply of transportation options. Innovative new businesses trying to make transportation more efficient and more plentiful are seeing plenty of public interest. But official policy continues to throw up barriers.

Hon Hai’s Explanation for iPhone 5 Shortage – China Real Time Report – WSJ – Hon Hai has recently implemented a new quality check procedure to reduce the chance of damages.  But he noted the iPhone 5 uses a new coating material that makes it more susceptible to scratching.

Inside Foxconn – James Fallows – The Atlantic – I was inside the most famous of these outsourcing centers. This is the Foxconn “campus” in the Longhua area of Shenzhen, north of Hong Kong. Some 220,000 people work there; about a quarter of them live on site

 

SOCIETY, ART, CULTURE AND HISTORY

Man arrested over smuggling dinosaur skeletons from Mongolia and China | Science | guardian.co.uk – Seizure of Tyrannosaurus bataar skeleton leads authorities to Erik Prokopi, who says he is no ‘international bone smuggler”

 

BOOKS AND LITERATURE

My Last Empress: A Novel: Da Chen: Amazon – Da Chen immerses the reader in the world of the Chinese imperial palace, filled with ghosts and grief, where bewitching concubines, treacherous eunuchs, and fierce warlords battle for supremacy. Da takes us deeply into an epic saga of 19th century China, where one man searches for his destiny and a forbidden love.

Book Talk: Ghosts, grief and great love in China | Reuters – After Samuel Pickens loses the love of his life, he travels the world to forget her – only to find her mirror image in the court of Imperial China, where he falls in love with one of the Emperor’s wives.

Was there a conflict of interest behind the Nobel literature prize? | FP Passport – Göran Malmqvist, a sinologist and member of the Swedish Academy, was instrumental in Mo’s selection, lobbying the academy to recognize the Chinese writer and providing Swedish translations of the writer’s work to other members of the academy. Now he stands to benefit financially from those tranlsations. According to a report by Swedish Television, Malmqvist will provide his translations to a Swedish publisher for publication. And according to the head of that publishing company, Tranan, because of the intense interest on Mo’s work as a result of his Nobel win Malmqvist will likely be able to name his own price.

Mo Yan’s roots revealed |Books |chinadaily.com.cn – Mo Yan’s 90-year-old father Guan Yifan still farms (left). Mo Yan’s elder brother Guan Moxin shows a farm implement they used in childhood (middle). Nie Peng, an inheritor of Gaomi’s clay sculpting tradition, hopes Mo’s win will draw global attention to local folk arts

The Nobel prize in literature: A Chinese Dickens? | The Economist – Mr Mo himself has batted away similar criticism, once saying that “censorship is great for literary creation”. And his ability to navigate the system within China, sometimes compromising, sometimes criticising bluntly or obliquely, makes his experience much more representative of life for most people in modern China today. His latest novel, “Frog”, tells the story of a midwife who has been complicit in forced abortions under China’s one-child policy. She has a hallucinatory vision of thousands of frogs, whose croaks sound like the cries of new-born babies. Hardly the stuff of party propaganda.

电影中的莫言 – 荐读 – FT中文网 FT Chinese by Jin Na on Mo Yan and movies//莫言获得诺贝尔文学奖之时,微博上有一张照片流传甚广,照片中的莫言、张艺谋、姜文三个男人精赤着上半身,唯一一个女人巩俐乖巧地站在一侧。众多转发和评论中,大致如此假想,“如果拍照时来一老道,说,你,将来拿戛纳奖,你,将来拿威尼斯奖,你拿柏林奖,至于你,诺贝尔文学奖。估计谁都会以为是天方夜谭吧!“照片拍摄于1988年,那时候的张艺谋执导他的处女作《红高粱》,他付给莫言的版权费是800元人民币,莫言喜出望外,认为自己发了大财

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