China News - Summer 2010

China's new 'Silk Road'

China has an ambitious plan to link 17 countries with more than 8,000 kilometres of high speed railway ultimately capable of carrying cargo and passengers all the way to London, Berlin and Singapore. Even by larger-than-life Chinese standards, the plans seem mind-boggling. The first long distance high speed train inside China opened in December 2009 and linked Wuhan with Guangzhou and reached a top speed of 350 kilometres per hour. This is faster than any train in Europe or Japan. By 2013 China intends to have 800 bullet trains across China and soon after that, across the border.

Two networks will connect with Europe with terminuses in London and Berlin. A third will link with Vietnam, Thailand, Myanmar and Singapore. Chinese engineers have already started work in Myanmar and according to Beijing, Central and Eastern European countries are keen to start work. The rail links will allow the transport of oil and gas and reduce the dependence on sea routes which involve passing through the Straits of Hormuz and the Straits of Malacca. (From Newsweek 10/5/10)

Can toads predict earthquakes?

Newspaper articles posing this question have appeared within the last month or so. Scientists were studying the breeding habits of toads at San Ruffino Lake, which is 46 miles from the epicentre of the L'Aquila earthquake before it happened. A researcher reported that the number of toads was increasing and then on one day there were hardly any. The next day they had all gone. Typically there were 67 to 115 toads in the area, but five days before the earthquake, 96% of the males were gone. In the past, a weather change has changed the numbers, but they usually come back after a day or so. A few days after the toads had all gone, the earthquake struck.

These details are from an AOL News report on 30 March 2010 via the internet. The reason why it has been reproduced here in China Eye is because early Chinese seismologists produced a seismograph comprising a circular receptacle with eight dragon heads on the outside arranged in a circle. In each dragon mouth is a bronze ball and below each dragon is a toad with an open mouth to receive a falling bronze ball. Presumably when an earthquake occurred, the direction of the epicentre could be determined by noting which ball had been released and caught in a toad's mouth.

Now the question is, 'Did those early Chinese seismologists know that toads can predict earthquakes?' You can see a modern reconstruction of the 'toad seismograph' made by Chang Heng in 132AD in the Science Museum in London and an account of the device on page 163 of The Genius of China by Robert Temple, Prion, London 1991.

China leads in clean energy investments

China's investments in renewable energy in 2009 exceeded those made by the US for the first time, according to a report , 'Who's winning the Clean Energy Race?', by the Pew Charitable Trusts (based on data collected by Bloomberg New Energy Finance). With its investment growing 50% in 2009, China committed $34.6 billion to wind power, solar energy and other forms of renewable energy - the biggest investor of such projects in the world. China invested nearly double the US's $18.6 billion and the world's third largest investor, which was the UK with $11.2 billion. China's installed renewable energy capacity rose to 52.5 gigawatts which was just behind the US's 53.4 gigawatts in 2009.

The report's authors commented that China is emerging as the world's clean energy powerhouse. Having built a strong manufacturing base and export markets, China is now working to meet domestic demand by installing substantial new clean energy-generating capacity to meet ambitious renewable energy targets. (From The New York Times 29/3/10, sent in by Chris Henson)

Cracking down on crime

Over 3,000 suspects, including the former police chief, have been arrested in Chongqing Municipality in southwest China as a result of a crackdown on organised crime ordered by Bo Xilai, the Party Secretary. Bo, 60, rose to prominence in Dalian where he was mayor of the city and later governor of Liaoning province. He was also a commerce minister before being appointed to run the huge municipality. He was selected as one of the 100 most influential people in the world in Time Magazine of 10 May 2010.

Chinese tourism growing

Twenty years ago, mainland Chinese rarely went abroad, but now with increased wealth and changes in government policy, which include the establishment of three official Golden Week holidays in 1999, Chinese tourism has ballooned. Easing of travel restrictions first meant travel to neighbouring Asian countries, then to the Mideast and Europe from 2002 to 2004 and finally to the US in 2007. According to the state-run China Tourism Academy, 54 million Chinese are expected to go abroad this year, up from 46 million in 2009 and a mere 10.5 million in 2000. Due to the financial crisis, global travel fell by 4% last year, but intra-Asian travel grew by 2%, led by visitors from China.

Analysts predict that the figures will keep expanding because at present, China's outward bound tourism represents a mere 4% of its population. By 2020, it is expected that mainland travellers will make 100 million trips abroad - making it the fourth largest source of overseas tourism. Chinese tourists are popular because they spend big, averaging $1,000 per person in retail goods alone. In the US, each person pumped an average of $7,200 into the economy. In Hong Kong, per person they spent 80% more than the Japanese.

Chinese tourists are mainly in the market for luxury labels, Rolex, Burberry, Gucci, Chanel and Louse Vuitton because these goods are actually far cheaper abroad than in China, where duty taxes are high - and the shoppers do not need to worry about fakes! (From Newsweek 24 & 31/5/10)

From the British Press

Beijing clamps down on torture-innocent man released and compensated

According to a report published on the Chinese Ministry of Public Security website, 'Confessions extracted through torture are unreliable', last year nearly 1,800 policemen were suspended for torturing inmates. Shangqiu's police chief Xu Dagang told Xinhua, 'Police officers should learn to handle criminal cases in a more intelligent and scientific manner'.

In Henan province, Zhao Zuohai has been released from prison. The person he was convicted of murdering in 1999 turned up alive and well in their home village of Zhaolou eleven years after Zhao was put in prison. He was originally sentenced to death, but this was commuted to 29 years in prison. He said that he confessed to murder after being beaten with sticks, forced to drink chilli water and deprived of sleep for a month. Police are looking into the matter and have assured him that those who secured the wrongful conviction will feel the full weight of the law.

Meanwhile the Henan authorities have announced that Zhao will be awarded 650,000 yuan (about £4,000) for each year he spent in prison. The 'murdered' man returned to his home village after eleven years in search of welfare support. If he had not returned, Zhao would have remained in prison until he was well into his seventies. (From The Independent 14/5/10)

Chinese court upholds British company's intellectual property

The Isle of Man based Strix Ltd which manufactures electric kettles controls took legal action against two Chinese manufacturers for patent infringements. Strix said that a court in Beijing ruled in December that its patent was valid and the court fined Zhejiang Jiatai Electrical Appliances Manufacturing Company and Leqing FaDa Electrical Appliance Company and ordered both to pay damages and to stop producing the kettle controls. Paul Hussey, chief executive of Strix said that this can be seen as big step in the right direction for the Chinese judiciary.

Clockwork radio inventor Trevor Baylis, also welcomed the decision and said that effective enforcement of intellectual property (IP) in China is a key concern of the many small UK businesses. There is widespread belief that enforcement of IP is a challenge for foreign companies but this decision demonstrates that this is not so. (From The Daily Telegraph 9/3/10)

Beijing switches cash from the military to the needy

China's declared defence budget, revealed yesterday, will grow 7.5% this year - its slowest rate for two decades. China is expected to spend £53 billion on defence this year and this surprised international analysts who had forecast a rise in the region of 14.5%, a rate slightly less than last year. Speaking just before the opening of the annual session of the National People's Congress, Li Zhaoxing, the parliamentary spokesman, said that the decision reflected a desire to spend more on social welfare programmes, which have lagged behind in recent years, in which the rich have become richer and the poor poorer.

Wen Jiabao, the Premier, is expected to announce a shift in funding to sectors such as health and education when he makes his state of the nation address to parliament today. (From The Times 5/3/10)

China driving luxury car sales

The Beijing Auto Show is being held this week. At a time when car sales are stagnating in Europe and the US, the market is booming in China - surging by 45% last year to 13.6 million vehicles and easily eclipsing the 10.5 million sold in the US. The increase in sales of super luxury cars, such as Rolls-Royce, is spectacular. Sales are up by 300% in the first quarter of 2010 and at this rate, sales in China will overtake those in Britain, which is at present the second largest market after the US for Rollers.

The Rolls-Royce German chief executive noted how young the Chinese customers are - many are still in their thirties and the youngest was just 28 years old. This is very different from what you see in other countries.

The Chinese customers are usually highly successful entrepreneurs in property, construction or retailing who have a keen knowledge of luxury brands - watches, jewellery and cars. Chinese media reported over the weekend that an unnamed 35-year-old had bought a £4million Bugatti Veyron. BMW, which already sells twice as many of its top-of-the-range 7-series in China than anywhere else, announced this week that it was raising its 2010 sales target to 120,000 vehicles after seeing its February sales up 96% this year. By the year 2012, BMW plan to make 200,000 cars a year.

Other manufacturers such as Mercedes are also planning increased production. China offers fatter profit margins as well as increased sales when markets elsewhere are flat or falling. (From The Telegraph 26/4/10)

Whitbread to open Costa coffee shops Whitbread plans to open 50 Costa coffee shops a year in Beijing and Shanghai, with more to be considered in Hong Kong and Guangzhou. The chief executive believes that the hotel market in China is already saturated with large hotel groups and it is too late for his Premier Inns, but not for coffee shops. He says, 'If you get it right in China, the numbers just roll off the page. (From The Independent on Sunday 30/5/10)

GCSE performance and ethnicity

Recent criticisms of the education system have noted the poor performance of white boys who receive free school meals - a benchmark of poverty - and have tended to point the finger at teachers. Such comments may be valid as far as they go, but they fail to consider the staggering variety in other ethnic groups.

The table below shows the latest performance figures for male pupils on free school meals at GCSE level, including English and mathematics. The figures relate to boys who achieved five or more A* to C grades at GCSE. More than three times as many Chinese boys hit this target as compared to white boys.

Ethnic Group The % of boys eligible for free school meals who achieved five or more A* to C grades at GCSE
Chinese 64.2
Indian 43.3
Asian (other) 41.9
Bangladeshi 37.7
Black African 31.7
Pakistani 30.4
Mixed 26.6
Black (other) 26.3
Black Caribbean 22.4
White 19.4

(From Prospect April 2010)

Chinese Ambassador Mme Fu Ying leaves UK to become a Vice Foreign Minister of China

There was reception for Fu Ying on the 26th January 2010 and she made a farewell speech in which she mentioned watching British theatre, football and horse racing during her time here. She also spoke of visiting places associated with British literature including Howarth, home of the Bronte sisters and the lakeside home of William Wordsworth. As for many Chinese, British literature was part of her education. During her three years in the UK, Chinese investment grew almost six-fold, the number of Chinese tourists and students increased at a double digit rate - in fact the amount of money spent by Chinese tourists shopping in Bond Street doubled last year. Britain is the largest EU investor in China and the third largest trading partner in the EU.

Fu Ying revealed that British-designed goods carry a lot of weight in China and Britain is regarded as a leading creative powerhouse in the world and also a leading global finance centre. These fit nicely with China's manufacturing power and both sides should work harder to tap the potential. British partnership is increasingly underpinned by support amongst both peoples and organisations such as the CBBC, the 48 Group Club and many other friendship and educational groups have created a wealth of interests and business opportunities which needs to continue and grow over the coming years. There is a growing interest in China amongst the British media and public. The Special Schools and Academic Trust has said that it is their ambition to provide every child in Britain the chance to study Mandarin if they so choose.

The sympathy and support shown by British people for China after the Sichuan earthquake was a moving experience for the Chinese ambassador. She commented that she is optimistic about future relations. Having said this, she stated that there have been highs and lows and there has been the temptation to criticise and judge when there have been disagreements. However, she has tried to draw inspiration from the historical wisdom of China and the UK and tried to steer a way through candid dialogue without losing sight of the larger interests of the two countries. But the West needs to decide whether it is going to accept China as an equal and take China as it is.

To do this the West must engage and discuss rather than lecture when problems occur. If the West's policy objective towards China is to change it in the image of the West, it may never be satisfied. China is in the middle of reforms and seldom does one see a major country whose professed objective is to reform itself. This is because China realises that there are still many areas that leave room for improvement. China will continue to reform but at its own pace and in its own way: not in the way the West wants it, but in the way that is in the best interests of the Chinese people.

The sooner stereotyping of China gets replaced by a wider understanding, the sooner we will be able to recognise our differences and diversity and build a strong relationship on understanding and respect.

We in China need to learn how to better explain ourselves to the world. Fu Ying concluded by saying that her message to her colleagues is always to communicate, communicate and communicate. (From 'Reflections' a supplement to China-Britain Business Review March 2010).

Chinese job creation

About 9.4 million jobs were created in Chinese cities during the first ten months of 2009. This exceeded the goal of 9 million for the entire year, state media reported. (AFP).

A photograph shows a group of young women practising standing and smiling properly during final selection for airline flight attendants in Hefei, a city in Anhui province. (From The Times 1/4/10)

President Hu visits earthquake area

Hu Jintao cut short a visit to South America to visit Yushu county, Qinghai province as the earthquake death toll reached 1,700 with 256 still missing and 12,128 injured. The area is predominately Tibetan and Professor Robert Barnett, an expert at Columbia University said that the brisk handling of the disaster was unprecedented. Hundreds of lorries carrying everything from earthmoving equipment and generators to instant noodles have been making the 560 journey from the provincial capital of Xining to the remote area. (From The Guardian 19/4/10)

Beijing airport now busier than Heathrow

Beijing's international airport has handled more passengers in the first two months of this year than Heathrow. Beijing handled 5.3 million passengers in February compared with Heathrow's 4.6 million and 5.4 million compared with Heathrow's 4.6 million in January.

Only a decade ago, Beijing did not even appear in a list of the world's 30 busiest airports. In January 2010, Atlanta had 6.4 million passengers and is the currently the busiest in the world but many of these are domestic passengers. Heathrow remains the busiest for international long-haul passengers. (from The Times 7/4/10)

Shanghai tops world rankings in commodity exchanges

Judged purely on the number of contacts traded in 2009, an astronomical rise in steel and copper trading allowed Shanghai to lead a trio of Chinese exchanges into the top six. Traders around the world use to look at New York, Chicago and Tokyo for a sense of the prevailing price of anything, but now they must look at Shanghai. In 2009, by contact numbers, trading on the Shanghai exchange was 20% higher year-on-year. (From The Times 7/4/10)

China plans to import more

The Chinese Vice-minister of Commerce Zhong Shan says that China will be importing more in future, 'especially technology, machinery and luxury goods'. Speaking at a China-Britain Business Council breakfast reception, he said that China is already the world's second largest market for luxury goods and there is potential for growth. China encourages imports from Britain and he hopes that Britain will do more research in this area and export to China what is demanded. The main purpose of his visit to Britain was to explore new ways of facilitating closer bilateral trade in the face of a fall in the exports from Britain to China. He would also be discussing the promotion of investment in both directions in the immediate aftermath of global recession. (China-Britain Business, March 2010)

Miracle escape of 115 trapped miners

After eight days and nights trapped in the darkness of a flooded coal mine in north-west China, 115 men have been rescued. More than 5,000 rescuers have worked around the clock since the accident pumping millions of gallons of water out of the mine. David Feickert, a coalmining safety adviser to the Chinese Government said that is was one of the most amazing rescues in the history of coalmining anywhere. The head of the State Administration of Work Safety said that it was a miracle. However rescue workers are still trying to find a further 38 men till missing.

This rescue may restore confidence in the industry which has seen many tragedies. A decade ago as many as 10,000 Chinese miners were killed each year, but last year, the total had decreased to 2,621. The Chinese authorities are striving to improve safety, especially since 70% of China's energy needs are from coal. The Government has clamped down on private mines and thousands have been closed down over the past two years. About 70% of all deaths are in privately owned mines. The publicity of the latest accident and the deployment of at least 5,000 rescuers highlight the determination to improve the reputation of the mines. (From The Times 6/4/10)

Tesco to expand in China

Tesco's first mall development is under the brand name 'Lifespace,' where a freehold shopping mall sits besides a Tesco hypermarket. This has proved a success in Qingdao where 50,000 people turned out for the grand opening on 9 January. This site has more than 30,000 sq m of retail space alongside the 10,000 sq m Tesco hypermarket and also community space and parking for 750 cars. Tesco has announced that a further 20 such developments are in the pipeline in large but as yet underdeveloped cities along China's east coast. Some of the malls will incorporate cinemas, offices and flats and the plan includes new leasehold stores. (China-Britain Business Review, March 2010)

Mars Mission starts

A Chinese volunteer was amongst the six men who are being 'sealed' away in a windowless capsule for 519 days to simulate a return voyage to Mars. The six-man 'crew' include three Russians, an Italian, a Frenchman and Wang Yue, the Chinese man. A manned space flight to Mars is still years away with technical problems such as radiation to overcome. This trial will explore the human aspects of six men living together in close proximity. (From The Times 4/6/10)

From the Chinese Press

Shanghai Expo opened

The opening ceremony of the 2010 Shanghai World Expo was held on the evening of 30 April featuring dazzling indoor performances as well as a lavish display of fireworks and lights at the riverside. President Hu Jintao presided and Jean-Pierre Lafon, president of the International Exhibitions Bureau delivered a speech to mark the event.

The next morning Mr Lafon and Jia Qinglin, chairman of the Chinese People's Political Consultative Conference, activated the opening device together at the opening ceremony to the public. Some 20 dignitaries attended the ceremony, including the EU Commission President Jose Manual Barroso, French President Nicolas Sarkozy and President Lee Myungbak of South Korea.

State leaders of 110 countries are expected to visit Shanghai during the six-month expo. A total of 33 million tickets had been sold as of May 4th - half the figure expected by organisers for the whole six-month period. The most popular pavilions so far include those of China, France, Italy, Switzerland, Brelguim-EU, Japan, Spain, Saudi Arabia and South Korea. However the Urban Best Practices Area is so far seeing relatively fewer visitors. (From China Today June, 2010)

Low-carbon lifestyle

On 24 March of this year, China launched a nationwide campaign to encourage a low-carbon family lifestyle. It was organised jointly by the All-China Women's Federation, the Central Commission for Guiding Ethics and Cultural Progress and also the National Development and Reform Commission.

Energy saving habits such as water conservation, use of recyclable bags for shopping and avoiding bottled drinks are promoted. 'China has 370 million families and if every one saves one kilowatt-hour of electricity, this will reduce carbon emissions by 290 million kg' said Song Xiuyan, the Vice Chairperson of the All-China Women's Federation. (From Beijing Review 1/4/10)

Huawei profit doubles

Huawei, China's largest telecommunications solutions provider's profits reached 18.3 billion yuan ($2.68 billion) in 2009, more than double the previous year. In addition, its revenue has increased by 19% year on year to 149.1 billion yuan. A further 20% growth in sales is expected this year in areas such as the convergence of fixed and wireless telecommunications networks and smart devices such as handsets and video terminals. Huawei now serves 45 of the top global 50 telecommunications operators - up from 36 in 2008. (From Beijing Review 8/4/10)

Cross-straits cooperation

Experts from the Chinese mainland and Taiwan started the second round of talks in Taipei on March 31 for an economic pact aimed to boost economic ties. The first round was held in January. The two-day meeting is to speed up the consultation process of the Economic Cooperation Framework Agreement (ECFA) which is intended to normalise economic cooperation. Views were exchanged on content of the agreement and preparations were made for formal ECFA discussions to take place in the first six months of this year. (From Beijing Review 8/4/10)

China/India relations

The year 2010 marks the 60th anniversary of the establishment of diplomatic relations between China and India. Friendly exchanges between the two countries can be traced back 2,000 years and India on April 1 1950 was the first non socialist country to recognise the People's Republic of China, just six months after its foundation. In addition, India as a non-permanent member of the UN Security Council advocated the restoration of China's seat in the UN. There have been numerous goodwill exchange visits by Indian and Chinese heads of state over the years and they meet frequently at area cooperation meetings such as the East Asian Summits and Shanghai Cooperation Organisation Summits. More recently they have met at the now regular BRIC conferences (major emerging nations of Brazil, Russia, India and China). At the Copenhagen Climate Change Conference, the prime ministers of India and China coordinated their positions and met the leaders of several other developing countries and called for unity amongst themselves. They urged the developed nations to fulfil their obligations and commitments.

In 2009, the militaries of India and China conducted exchange visits. The trade volume between the two countries exceeded $50 billion and China became the largest trade partner to India. During 2010, the bilateral trade target is $60 billion. To mark the 60th anniversary of Sino-Indian diplomatic relations, there will be an 'India in China Year' in China and a 'China in India' year in China. (From China Today, April 2010)

New Chinese UN envoy

China's new permanent representative to the UN is Li Baodong. Li, 55, entered the diplomatic service in 1977 and after serving as Ambassador to Zambia from 2005-07 he was appointed permanent representative to the UN Office in Geneva. He studied at John Hopkins University in the US in 1988-89 and was China's senior official for the Asia-Pacific Economic Cooperation Forum in 1998-2005. (From Beijing Review 18/5/10)

Central food safety authority established

The State Council of China introduced a new tighter Food Safety Law, and established a food safety commission during February. Li Keqiang, vice-premier and a member of the Standing Committee of the CPC Political Bureau, was made chair of the organisation. Two other vice premiers were made deputy chairs, and other senior officials and government ministers were appointed members of the commission. They represented areas such as industry, information technology, quality supervision, inspection and quarantine. The Ministry of Health, Agriculture, State Food and Drug Administration and the State Administration of Grain were also represented. (From China Today, April 2010)

New Code of Ethics for officials The CPC Central Committee unveiled its Code of Ethics for Communist Party officials to replace the trial version drafted in March 1997. The document specifies prohibited acts for CPC members who hold positions at or above the rank of section chief or county magistrate and who hold senior positions in state-owned companies. The document vows increased surveillance within the party, but also promises broader supervision by non-CPC members and non-government groups as well as by individual citizens and the media. (From China Today, April 2010)

Opinion on the Google issue

At the start, Google complained about hacker attacks on its servers, but it later asked China to abolish its censorship requirements and threatened to leave the Chinese market. Thus the issue of internet security became a demand for China to change its current laws. Is Google doing business or playing politics? If doing business, it should act within the commercial sphere, where disputes are common but can be resolved by commercial procedures. However, the nature of the issue changes if Google tries to interfere with China's politics and social reform through commercial behaviour.

Today's Chinese society is already quite open and is being further opened due partly to the development of the internet. However, in every society, openness is not absolute and openness needs time to develop. The Chinese people have their own plans and schedule as to what extent the door should be opened and how to open it. Outsiders' opinions can only be taken as references. It is unwise for an internet company to try to influence this process - even if it boasts advanced technologies and adequate capital.

Constructive criticism and suggestions are helpful to China's development, but if they are politically motivated and try to force China to submit through threats, then they are naïve. (From Beijing Review 1/4/10)

Winter Olympics in Vancouver

The 2010 Winter Olympics ended on 28 February in Vancouver. The Chinese team brought home five gold, two silver and four bronze medals. This was a great improvement on previous performances - as China had only won four gold medals in all the previous Winter Olympics combined. This year in the 3,000 metre relay, the Chinese team set a world record time of 4 minutes and 6.610 seconds. Chinese figure skating couple Shen Xue and Zhao Hongbo won the gold medal for figure skating - a first time for China. (From China Today, April 2010)

China's losses from natural disasters

China spent 10.5 billion yuan on natural disaster relief in 2009. Some areas were hit by severe drought, others by floods, snow storms and typhoons. A total of 480 million people were affected inflicting direct economic losses of 252.3 billion. As many as 1,528 people were killed or are missing, 830,000 houses collapsed, 47.21 million hectares of farmland saw reduction in harvests with 4.91 million hectares losing entire crops. (From China Today March 2010)

Richest Chinese woman

Wu Yajun was named as the richest Chinese woman in mainland China by Forbes magazine. She and her family were ranked 232 on the latest list of billionaires. Her estimated worth is $3.9 billion, which is the sixth largest for Chinese mainlanders on the list. Wu is president of Chongqing based Longfor Properties in southwest China and holds a 46.9% stake in the company. Last year $3.38 billion was raised in an initial public offering in Hong Kong. Wu, aged 46 started her business in 1993 after working for a Chongqing newspaper for six years as reporter and editor. In 1995 she founded Longfor properties which focuses on high-end residential projects. (From Beijing Review 25/3/10)

China's jumbo jet

Xinhua has reported that the draft design of China's first independently developed jumbo jet will be completed by the end of this year. It is known as the C919 and is expected to enter into production next year and, following test flights in 2014 in different climatic conditions, put into service in 2016. At present a 168-seat model and a 156-seat model are to be designed, with further variants expected in the future to meet the requirements of different carriers. (From Beijing Review 25/3/10)

Sino File is compiled by Walter Fung with some input for From the Chinese Press by Teresa Ray.

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