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Busy morning so just a brief commentary to followup on yesterday’s discussion of Hukou reform. The Global Times takes issue with Mayors claiming poverty as excuse to avoid changing the residence system, writing in Mayors have become obstacles to hukou reform that:
This is quite an embarrassing situation for hukou reform. Those key players who ought to be the driving force of reform are instead acting as obstacles. Hukou reform is one of the toughest challenges facing China. Hukou is not just a population management concept, but is also closely related to social welfare such as education and medical insurance…Reforming the hukou system means breaking up the barriers that block the migrant population from enjoying equal benefits provided by cities. But for local governments, expanding the coverage of social welfare means they will have to face great financial pressure. This clarifies why most mayors are unwilling to promote the reform.
I am experimenting with a new format, comments welcome.
BUSINESS AND ECONOMY
- China’s Auto Joint Ventures Failing to Build Local Brands – Bloomberg
Liu Yu said he was making a generous offer: a $1 million subsidy to entrepreneurs willing to build a dealership for BAIC Motor Corp.’s Beijing car brand. Though that covers about three-fourths of the cost of each outlet, the BAIC deputy sales chief has struggled to recruit the 150 candidates he wants by year-end, whereas BAIC’s parent company has no trouble finding dealers for its joint ventures with Daimler AG (DAI) and Hyundai Motor Co. (005380), even without subsidies.
“China’s indigenous cars are the lowest in the food chain,” said Liu. “Many consumers are biased against them.”
21 CBH on the possible Hubei property tax plan. Now Hubei official denying they are ready to roll out. From the reports over last few weeks you can see how sensitive a topic this is. Ignore any academic/economist who tells you property tax is a solution to many of China’s issue unless they can explain the politics of how it might actually be implemented in the real world//
- China’s Stocks Decline on Property Tax Concern, Earnings Slump – Bloomberg
The central province of Hubei is proposing detailed property tax rules, the Legal Evening News reported yesterday, citing Xu Zhengyun, a spokesman for the provincial taxation bureau. The tax will be based on market value instead of the purchase price of the properties, the newspaper said, citing an unidentified person. The timetable of the tax rules isn’t known, the newspaper said, citing Xu.
21 CBH on Beijing CBD office market, demand far outstrips supply, rents up significantly//
- Beijing rated world’s top office market |Economy |chinadaily.com.cn how many western “experts” predicted years ago that beijing office market was going to crash imminently?//Beijing has ranked first among 100 leading global city office markets and won five out of six possible “gold medals”, according to a research report released on Aug 22 by US real estate services company Cushman & Wakefield.
- China central bank dismisses reports of lost gold reserves – Xinhua | English.news.cnThe remarks came in response to a report carried by a Hong Kong-based magazine stating that the Ministry of Finance, the central bank, the Ministry of Supervision and the National Audit Office had jointly set up special groups to investigate the whereabouts of 80 tonnes of gold reserves that had gone missing from the national treasury. “The report was made out of thin air. The central bank denounces such practices,”
- Chinese vice premier stresses fair distribution of low-income homes – Xinhua | English.news.cn
had the low income housing policies been effective beijing would have much more flexibility around monetary easing and real estate controls//
Vice Premier Li Keqiang has called for local authorities to fairly distribute low-income housing units to those needy families in a transparent way, adding that tightening measures for the country’s property market will remain in place.
Li’s remarks came during an inspection tour of low-income housing communities in Beijing on Tuesday.
Yi Xianrong writing in Chinese Financial News on why loan demand still a problem in spite of interest rate cuts, warns that if monetary stimulus won’t work the China may go back down the old road of blowing a real estate bubble to keep the economy growing//
- China Q2 bank earnings to signal end of easy profits | Reuters
do the big chinese banks have less healthy loan books than your average us tbtf or european bank? or are most major banks around the world at or near insolvency, but for regulatory forebearance and accounting gimmicks?//
Deposit growth has slowed down, partly because of outflows to investment products that offer higher returns. Since the start of 2011, banks have suffered net monthly declines in yuan deposits five times, compared with just once between 2002 and 2010.
This year the central bank raised the competitive stakes by giving banks more leeway to set their own deposit and lending rates. Commercial banks can now set deposit rates at up to 1.2 times the benchmark central bank rate.
- China Shipping delays ship deliveries to cut costs | Reuters
China Shipping Development Co Ltd, an oil and dry bulk shipping firm, said on Wednesday that it has delayed delivery of 10 ships and is in talks to postpone another 10 to cut interest costs after reporting its first net loss in 14 years.
- China to spend $372 billion on cutting energy use, pollution | Reuters
China will plough $372 billion into energy conservation projects and anti-pollution measures over the next three-and-a-half years, part of a drive to cut energy consumption by 300 million tonnes of standard coal, the country’s cabinet said Tuesday.
- 星河湾顶包案调查_杂志频道_财新网 fun Caixin article on a real estate investigation in Ordos//查处非法用地越来越变成一场猫鼠游戏
- S&P: China can afford another big stimulus — Shanghai Daily
CHINA can afford another big stimulus but doesn’t need it at the moment despite growing economic tensions, a report by Standard & Poor’s Ratings Services said today.
- Why Premier Wen’s Not Happy – Economic Observer News- China business, politics, law, and social issues
Wen Jiabao has publicly stated that he doesn’t want to waste his last year in office and his call for “visible and encouraging actions” is different from his regular pragmatic and low-key style.
- Iron Weights – Caixin Online
Imported iron ore is piling up at China’s ports, burying the potential for profits at state-owned and private commodities trading companies alike.
- Shrouded in Mystery: Chinese Executive Compensation and the Numbers Behind the Numbers – Arabic [email protected]
- BBC News – Rich Chinese seeking overseas residency Big difference between leaving and diversifying/preparing an exit plan. The latter not good but nearly as bad as some of the distorted reports about rich Chinese “fleeing”//
The party is far from over for China’s wealthy, including Louie Huang – who has just opened a brand new nightclub.
As his patrons sit around tables containing a dozen or more bottles of champagne it is abundantly clear that many people are still making money here.
But in these economically uncertain times, there is a growing temptation for those with money to take it, and themselves, somewhere a little safer.
- Google Finally Leads in China — in App Ad Sales – Bloomberg nice timing amidst the Qihoo news//
“Since 2010, Google has been trying many things to keep its presence in China,” said Steven Chang, chief executive officer of ZenithOptimedia’s China division, which buys advertising from Google and Baidu. “AdMob now has quite a significant share of the market.”
Revenue in China’s mobile-app ad market will probably more than double to about 1.8 billion yuan ($283 million) this year, exceeding the 1.2 billion yuan from mobile-search queries, according to iResearch.
- Online Price War: All Mouth, No Trousers? | Alizila
At the Beijing media briefing, though, eTao officials told reporters that according to the data it has been monitoring, the price war has been mostly a war of words calculated to work consumers into a buying frenzy.
Discounted appliances have been available only in small quantities and price reductions have not been as deep as vendors promised, eTao officials said. They suggested some shopping websites used deception by marking up prices before offering discounts, making the savings look greater—allegations similar to those appearing in stories in the Chinese press, which found that actual discounts were no greater than 10 percent.
- Tencent to Offer TV in China to Expand Its Online Reach – Bloomberg
The TV, which allows access to Web services using cloud computing technology and was developed with TCL Multimedia Technology Holdings Ltd. (1070), is the first time Tencent collaborated with an appliance maker, Tencent Chief Executive Officer Pony Ma said in Shenzhen today. The company will continue to work with device manufacturers, he said.
- Vertical E-Commerce B2C VCotton Suspends Operations | Marbridge Consulting – China Internet News
A former VCotton employee said that the suspension of sales was not caused by a logistics breakdown but instead due to its Beijing warehouse being seized by government authorities after the company’s suppliers sued VCotton for failure to pay outstanding debts. The source added that warehouse employees have been barred entry and the warehouse sealed. A Marbridge Consulting researcher discovered that VCotton angel investor Xu Xiaoping confirmed the rumor on his personal Sina Weibo account.
- Military official’s US visit linked to islands |Asia-Pacific |chinadaily.com.cn
The unexpected visit by a senior Chinese military official to the United States is widely seen as being linked with territorial tensions in Northeast Asia, and analysts said the Diaoyu Islands issue would be discussed by the two militaries.
Cai Yingting, deputy chief of the general staff of the People’s Liberation Army, left Beijing on Monday for an official visit to the US. This is the second visit by a senior Chinese military official to the US in three months. Defense Minister Liang Guanglie paid a six-day visit to the country in May.
- The risk of US-China conflict | The World
A few months ago, I interviewed James Steinberg at the German Marshall Fund’s Brussels forum. Steinberg has recently stepped down as Hillary Clinton’s deputy and is regarded by some American hawks as a “panda hugger” – a derisive term for somebody who is soft on China. He is certainly dedicated to trying to improve relations between the two countries. Yet I got the feeling that, in the long run, he is fairly pessimistic. He stressed that – for all the good intentions on both sides – there is a fundamental lack of trust between Beijing and Washington that bodes ill.
- “China’s House Divided” by Christopher R. Hill | Project Syndicate–Chris Hill
is this the informed view of the US government?//
whereas America’s problem in the world today is that domestic pressures sometimes lead to an excess of fortitude, China’s problem is that similarly constraining pressures produce foreign-policy weakness.
- STRATCOM Commander Rejects High Estimates for Chinese Nuclear Arsenal » FAS Strategic Security Blog
This will drive some in DC nuts, can’t want to see some some claim General Kehler is “soft on China/pro-China// “I do not believe that China has hundreds or thousands more nuclear weapons than what the intelligence community has been saying, […] that the Chinese arsenal is in the range of several hundred” nuclear warheads…General Kehler’s statement was made in an interview with a group of journalists during the Deterrence Symposium held in Omaha in early August (the transcript is not yet public, but was made available to me).
- Canadian Mark Bourrie speaks out about split with Xinhua news agency | Canada | News | National Post
- PLA test-fired multiple warhead ICBM in July: Jane’s Defence Weekly｜Politics｜News｜WantChinaTimes.com
An anonymous US official says a Chinese DF-41 ICBM with the range to strike any city in the United States was test-fired by the PLA’s Second Artillery Corps for the first time on Jul. 24, according to Jane’s Defence Weekly.
- Insight: China ups lobbying game, but faces key tests in U.S., Canada | Reuters
lots of money out there for lobbyists who want to take up the cause//
Instead of issuing tirades, the Chinese hire top-notch lobbying firms whose ranks are filled with well-connected former U.S. and Canadian officials; buy TV advertisements to buff their image; and seek acquisitions less likely to stir nationalistic fervor.
- China Prepares New Plan to Fight Graft That Threatens Its Image – Bloomberg
“The work of constructing a system of punishing and preventing corruption has shown to be effective,” He Guoqiang, head of the party’s Central Commission for Discipline Inspection, said yesterday, according to the People’s Daily newspaper.
- Closer Look: Bogu Kailai and Sentencing Procedure – Caixin Online
and there is a rumor going around that Gu has cancer//
Someone who has already carried out their two-year reprieve and at least seven years in prison, suffering from a chronic disease where there is no treatment, could also apply to be released on medical grounds. That is to say, from the time of the sentencing, this criminal will have only served nine years in jail.
But if the disease worsens and the criminal is likely to die soon, and on top of that, he or she has shown good behavior, then the previously mentioned time stipulations don’t apply and the jail time may be further commuted to shorter than nine years.
- China to formulate new five-year anti-corruption plan – Xinhua | English.news.cn
China will implement a five-year plan for eliminating corruption after the upcoming national congress of the Communist Party of China (CPC), top official He Guoqiang said on Tuesday.
- Myanmar’s reforms no beacon for China – Globaltimes.cn
We sincerely hope Myanmar’s reforms will prove successful. But it’s naïve if we doubt the road we have taken, just because these buds look different from China’s prosperous tree of reform.
China’s press freedom has walked a fairly long way. We need to walk further in the future. But China should follow the trend of the times and look at the practical situation of the nation, rather than being perplexed and even letting backwater countries like Myanmar and Vietnam become our idols.
- 明鏡新聞網: 令計劃的話連胡錦濤的家人都得聽
- China needs new phase of enlightenment – Globaltimes.cn
Now it needs a localization of Western-style democracy. Western thought has to be combined with China’s reality to produce a positive impetus. Given China’s size, completely copying the Western model has no historical or realistic basis in China. The westernization of China is just the dream of a few idealists.
The painful process of the westernization of other countries has given China grave warnings. Western ideology is not our bible, and shouldn’t be deified…China needs a new enlightenment. It needs a large number of great thinkers and opinion leaders to initiate it.
- Jiang takes the spotlight in congress run-up | SCMP.com
Ex-president featured in glowing newspaper review, the latest of publicity blitz that analysts see as exerting his clout in leadership transition
- Manager accused of fraudulent labeling |Society |chinadaily.com.cn another Mengniu problem. why anyone who can afford alternatives would still buy their products is beyond me// Police in East China have detained a sales manager at Mengniu Dairy Group on suspicion of tampering with the production dates on batches of milk and yogurt.
- Plants in China that produce U.S. dog treats blamed for killing thousands of pets ‘refuse to let FDA inspectors collect samples’ | Mail Online
FDA has been investigating four plants in China that produce treats for U.S. brand Nestle Purina…Pet owners complain that treats have been responsible for deaths and illness of more than 2,000 pets
CCTV knew before Liu Xiang’s race at the Olympics that he was hurt, had 4 scripts prepared? No wonder his advertisers got new ads out so quickly//
- Can Chinese eye exercises help prevent myopia? – Behind The Wall
The prevalence of myopia, however, is skyrocketing. An estimated 80 to 90 percent of Chinese are short-sighted by the end of high school – triple the U.S. rate. Few Chinese questioned the effectiveness of the eye exercises over the past five decades – until a recent post challenging the exercises was published earlier this summer on Sina Weibo, China’s widely popular answer to Twitter.
- Language and China’s ‘Practical Creativity’ – NYTimes.comWilliam C. Hannas is one of the most provocative writers on this today. He believes character writing systems inhibit a type of deep creativity — but that its effects are not irreversible…He is at pains to point out that his analysis is not race-based, that people raised in a character-based writing system have a different type of creativity, and that they may flourish when they enter a culture that supports deep creativity, like Western science laboratories…Still, “The rote learning needed to master Chinese writing breeds a conformist attitude and a focus on means instead of ends. Process rules substance. You spend more time fidgeting with the script than thinking about content,” Mr. Hannas wrote to me in an e-mail.
- Quack medicine in the military: Acupuncture, cupping, and moxibustion are endangering troops. – Slate Magazine
what an ignorant article from slate//
- Black’s New Number – People – Eye – WWD.com
As the newly appointed creative director for the high-end Chinese cashmere brand Erdos 1436, Black, who has worked as a designer for Armani, Hugo Boss and Ferragamo, will head up design for a conservative and relatively new luxury brand that is worn by some of China’s most powerful women, including executives and the wives of top government officials. Black joined the company in November, signing on to a five-year contract, but is only now going public about this role.
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