China News - Autumn 2015

Air pollution improvement in China

Greenpeace reports that air pollution in some of China’s smoggiest cities fell by nearly a third in the first quarter of this year. In Beijing, levels of PM2.5 airborne particulates with a diameter small enough to penetrate the lungs, fell by about 13% in the first three months of this year compared to the same period in 2014. Among the 74 cities that have monitored air pollution for more than a year, some saw decreases of as much as 48%. Hebei province, which surrounds Beijing and contributes much to the capital’s pollution, saw PM2.5 levels plunge by 31%.

The drivers were the government’s strict measures to control air pollution. Pollution from heavy industry in places like Hebei and Beijing has been drastically reduced according to Zhang Kai, Greenpeace East Asia Climate and Energy Campaigner. Coal-burning by power stations and industry and vehicle emissions are the main sources of air pollution.

However, despite the improvements, about 90% of 360 cities now tracked by Greenpeace had levels of particulates above government limits and Shanghai saw a 13% increase in PM2.5 levels. (From the internet; Agence France-Presse in Beijing 21/4/15)

An amazing coincidence!

A member of the Meridian Society was reading Summer’s China Eye just after it was issued. He had just reached page 39 and was reading about Feng Yuxiang, the Christian General. At exactly the same time his wife was reading The Times which featured a report on David Cameron who compared the Labour Party’s change of mind on the EU to Feng Yuxiang baptising his troops with a hose pipe! Did David Cameron catch sight of a copy of China Eye?

From the British press

First double-decker electric bus

The world’s first electric double-decker bus will be on Britain’s roads this year in the effort to cut emissions. Five of the new buses will be trialled in London from October. The buses are expected to improve air quality and provide quieter journeys. They have been designed by BYD, a Chinese company and will be able to travel up to 162 miles on a single charge of about two hours. The new buses will be the latest addition to London’s fleet of green buses which include single decker electric vehicles, zero-emission hydrogen buses and hybrids which run on a combination of diesel and electricity (From The Times 30/6/15).

Paris UN environment meeting - China’s contribution

China is likely to propose cutting its carbon emissions per unit of GDP by 60-65% of 2005 figures by 2020. This follows earlier commitments for the country’s carbon emissions to peak no later than 2030. The US, Brazil and South Korea are also believed to have fresh plans for cutting emissions. However some analysts believe the measures will not be sufficient to stop global temperatures rising by more than 2 degrees Centigrade from pre-industrial times. (From The Financial Times 1/7/15)

China’s property march into London

Fosun has become the latest Chinese investor to move into the UK’s property market. It has joined forces with Resolution Property and plans to invest in poor-performing assets where they believe value can be found. They have been reported to consider a bid for Cushman and Wakefield, property agents who own the Lloyds Chamber building in the City. The new venture, called RPIM, will continue Resolution Property’s strategy of investment in real estate assets in both the UK and Europe. The chief executive of Resolution Property believes the venture with Fosun provides substantial investment capability and allows them to build on decades of experience.

Chinese companies are becoming increasingly active in the UK. Last year, China’s biggest life insurance company, China Life, bought a majority stake in the Clifford Chance headquarters in Canary Wharf, whilst in 2013 Ping An, another Chinese insurance company, bought the Lloyds building in central London for about £260 million. Another Chinese property developer is transforming a part of the Royal Albert Dock, near the City airport, as a space for business. (From The Times 2/7/15)

UN Aung San Suu Kyi in Beijing

The Independent newspaper has a photo of ‘The Lady’ in the Great Hall of the People with Xi Jinping. She is in Beijing for talks aiming to build ties with China. (Independent 12/6/15)

Hong Kong business down

For almost three months in late 2014, Hong Kong was on edge as student-led democracy protesters blocked streets in the Admiralty district. Westerners cheered them on whilst the business owners grumbled about the disruption. The protests have reduced the number of visitors from mainland China. The numbers fell by 5% year-on-year in May and by 10% in June. Drops in the Japanese yen and the South Korean won have made Tokyo and Seoul alternatives for shoppers.

Burberry, the luxury retailer of trench coats, scarves and handbags, reported receipts in its 15 shops in Hong Kong to be down by more than 10%. Although the shops remain profitable, changes are being made. Chinese customers have bought up to 40% of Burberry’s products worldwide. (From The Times 16/7/15)

China’s growth figures questioned

Official figures show two consecutive quarterly growth rates of 7%. Some analysts question this because they are too close to Beijing’s target of 7% annual growth. Julian Evans-Pritchard of Capital Economics suggests that the growth rate is almost certainly a percentage point or two slower than the official figures show. Despite his reservations, however, he still thinks that the figures show a genuine stabilisation of conditions.

Justin Yifu, a former vice-president of the World Bank said in Beijing yesterday, that there was ‘no suspense’ about China hitting the 7% target. Given the large gap in GDP and income per capita between China and developed countries, MR Lin said that China should have the potential to achieve 8% economic growth for ten or more years. (From The Times 16/7/15)

Party Mandarin gets life in prison

The most senior member of the Chinese Communist Party so far found guilty for corruption was jailed for life yesterday. Zhou Yongkang was a member of the Standing Committee of the Politburo, the highest level committee in China. He admitted his guilt and said, ‘I submit myself to the verdict of the court and I do not appeal. I recognise the facts of my breaking the law, which has caused great losses to the party. I again admit my guilt and am penitent’. Willy Lam, an expert on China’s politics at the Chinese University of Hong Kong believes Zhou was spared execution because he has party members still allied to him and this is appeasement towards them. The 72-year-old Zhou was tried for taking bribes, abuse of power and intentionally leaking state secrets. All his personal assets have been confiscated and his political rights withdrawn for life. (From I (Independent) 12/6/15)

From the Chinese Press

‘One Belt, One Road’

The Belt and Road development is expected to run all the way from Asia to Europe by linking all the economies in between through trade and investment. The ‘Belt’ is the belt of land around the former Silk Road which ran overland from China to Europe. The ‘Road’ is the former Maritime Silk Road from the Chinese coast to the Middle East and beyond via the Indian Ocean.

At the end of April 2015, the One Belt and One Road Index, jointly launched by China Securities Index and Shenyin Wanguo Securities had soared 69% from the beginning of the year. Institutional investors, some foreign have poured money into companies listed in the index. Most are state-owned giants focussing on infrastructure, which are likely to be the first to benefit.

The area of the Belt and Road has a population of 4.4 billion people (63% of the world’s total), and the combined GDP of the 60+ countries and regions is $21 trillion (29% of the world’s total). At present the area accounts for 23.9% of the world’s goods and services export market and the Eurasian railway network comprises 81,000 km. (From Chinareport June 2015)

Premier Li visits four Latin American countries

Li Keqiang visited Brazil, Colombia, Peru and Chile from 18-26 May. He signed several initiatives of cooperation during his visit. They included a feasibility study to construct a transcontinental railway across Brazil and Peru linking the Atlantic coast to the Pacific coast; construction of the first metro system in Bogota, Columbia; buying a controlling 80% interest in Brazilian Banco BBM SA; jointly developing Orinoco agricultural and road projects in Columbia; granting 50 billion yuan ($8 billion) to Qualified Foreign Institutional investor quota in Chile purchase of three more Y-12E aircraft from SATENA (Colombia) (From Beijing Review 4/6/15).

China and the world’s financial system; three development banks

The finance ministers or authorised representatives of 50 founding members of the Asian Infrastructure Investment Bank (AIIB) signed the formation agreement on 29 June 2015. Other founding members can do so before the end of 2015. This development adds momentum to China’s efforts to build a multipolar financial network comprising the AIIB, the development bank of the BRICS countries and the proposed development bank of the Shanghai Cooperation Organisation and common development through the Belt and Road Initiative.

China is playing a leading role in negotiations, preparations and the organisation of the AIIB which is in line with the needs of the Belt and Road Initiative, which aims to use China’s huge foreign exchange reserves and strong manufacturing facilities to promote regional integrity and common development. The top five stockholders in the AIIB are; China ($29.78 billion), India ($8.37 billion), Russia ($6.54 billion), Germany ($4.48 billion) and the Republic of Korea ($3.78 billion). China is the leading stockholder and also has the highest percentage of shares, 26.06% of votes.

The principle of cooperation with the BRICS countries, is equality, even though China’s economic power far outweighs the other states. The agreement is equal rights and decision making. (From China Daily 10-16 July 2015)

Public input for the environment

A draft of public rights was issued on 14 April by China’s Ministry of Environmental Protection to encourage public participation in projects and policies concerning the environment. Authorities should make information available via the internet and other media and the public can apply for more information if they deem it necessary. Information considered a state secret or private is exempt. The draft is open for feedback until 20 April. (From China Daily European Weekly 17-23/4/15)

China’s ‘ghost cities’ and urbanisation

The once-empty cities built with a wave of urbanisation in mind are filling up at surprising rates. The term ‘ghost city’ is not appropriate; a ghost town is a place which has died, whilst these places are new cities.

China’s urbanisation began in the 1980s when only 180 million people lived in cities. The process speeded up in the early 2000s. In 2013China’s National Development and Reform Commission set out to discover how many new areas were being built. They found that in 144 cities, 200 new towns were being built or being planned. China now has over a quarter of the world’s 100 largest cities; 171 cities with a population of over one million. The McKinsey Global Institute predicts that 29 of the 75 most economically dynamic in 2025 will be in China. At present there are 730 million urban Chinese and this number is expected to increase by another 250 million by 2030.

China’s urbanisation has been set in motion by a fiscal policy that makes cities expand. According to the World Bank, cities in China must raise 80% of their expenses, whilst only receiving 40% from national tax revenue. The difference is often raised by land sale. Land is bought by the cities at the low rural rate and then sold on to developers at the much higher urban construction rate. Huge profits are realised; the Ministry of Finance says land sales yielded $438 billion in 2012 alone.

Filling the ‘ghost towns’ present complex problems because schools, shopping facilities health centres, roads and rail links etc. are all needed for the inhabitants. However, the developments are very long-term. (From China Daily, European Weekly 3-9/7/15)

Robotics; China catching up

China’s robotics industry started three decades behind Japan, but is rapidly becoming a major player and by 2030 could be a world leader. Last year 57,000 robots were sold in China; this is about 25% of the worldwide total. Of the 57,000, 40,000 were foreign made, but Chinese robot sales are growing by 60% a year. The Chinese government is investing in robot research and development and in 10 to 15 could be the world leader. At present, China is lagging behind in ‘robot density’. This is a measure expressed by the number of robots per 10,000 workers. Worldwide the average figure is 60 per 10,000 workers, in the US it is 152, in Germany it is 182 and in Japan and South Korea it is over 300. China, at present lags behind with only 30, but this is set to change considerably.

The use of robots is becoming increasingly cost-viable and necessary because of China’s shrinking workforce; some analysts believe that 25% of China’s population will be of retirement age by the early 2030s. In Donguan, the authorities claim there is a shortfall of 800,000 workers, more than 505 of its factories have invested $1.9 billion (4.2 billion yuan) to replace 30,000 human workers with robots. The electronics giant Shenzhen Evenwin Precision Technology Co is to install 1,000 robots to reduce its human workforce of 1,800 by 90%. (From China Daily European Weekly 19-25 June 2015)

India and Pakistan to join SCO

After 14 years of development, the Shanghai Cooperation Organisation (SCO) has set out a plan for the next decade. The 15th meeting of the Council of SCO Heads of State that was held in Ufa, the capital of the Russian Republic of Bashkortostan during 9-10 July. The SCO leaders, China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan, approved the development strategy for 2015 to 2020. Cooperation will be in politics, security, economy and people-to-people exchanges. India and Pakistan are to join the other countries which will mean that the extended SCO will have a combined population of 25% of the world’s total and in 2014 their combined GDP was $15 trillion and represented 25% of the world’s economy.

Observer states of the new SCO are: Afghanistan, Belarus, Iran and Mongolia. Dialogue Partners are: Azerbaijan, Armenia, Cambodia, Nepal, Turkey and Sri Lanka. (From Beijing Review 23/7/15)

New area for Changsha

The capital city of Hunan province has had a new area established, the first in central China. The area, called Xiangjiang is on the west bank of the Xiangjiang River and covers 490 square km. This will be the 12th state-level new area; the first was Pudong in Shanghai in 1992. Others were set up in Tianjin, Chongqing, Zhejiang, Gansu and Guangdong. The new area in Changsha will be a hi-tech manufacturing and innovation centre to aid the development of central China and the Yangtze River economic belt.(From Beijing Review 4/6/15)

China-Korea Free Trade Agreement (FTA)

China and the Republic of Korea (ROK) signed a FTA on 1 June in Seoul. Under the treaty, the ROK will eliminate tariffs on 92% of all products from China within 20 years and China will abolish tariffs on 91% of all ROK goods. The treaty is the result of more than a dozen rounds of negotiations between the two countries since May 2012. ROK President Park Geun-hye visited China in June 2013, whilst Xi Jinping visited the ROK last July. This treaty provides a boost to the two counties’ bilateral strategic cooperative partnership. (From Beijing Review 11/6/15)

Senior official sentenced

Zhou Yongkang, a former member of the Standing Committee of the Politburo’ of the Communist Party of China has been sentenced to life in prison at Tianjin. He was found guilty of accepting bribes, abusing his power and deliberately disclosing state secrets. He pleaded guilty to the charges, repents his wrongdoing and will not appeal. He said that he takes responsibility not only for bribes to himself, but also those taken by his wife and family and that he has broken the law and Party rules incessantly. (From Beijing Review 18/6/15)

Smoking ban in Beijing, China

On 1 June smoking was banned in all of Beijing’s indoor public places and workplaces and on public transportation. In addition smoking is banned in some outdoor public locations, such as schoolyards. China is the world’s largest producer and consumer of tobacco with over 300 million smokers. Over 740 million non-smokers are exposed to cigarette smoke and more than 1.36 million people die of smoke-related illnesses every year. If no effective action is taken, it is believed that over 3 million people will die every year of smoke-related conditions by 2050. Smoking bans have been introduced before but have been largely ineffective and because tobacco is an important cash-crop, local authorities have been reluctant to prohibit smoking outright. However, the new regulations seem to be more effective than previous ones because of stronger enforcement.

This is amongst the toughest regulation of its kind in China and re-affirms the country’s anti-smoking determination. In November 2014, China issued a draft regulation document for public consultation to ban indoor smoking, limit outdoor smoking and end tobacco advertising.

China’s cigarette production has increased in recent years, but on the other hand 13 cities including Beijing, Shanghai, Hangzhou and Guangzhou have implemented local regulations banning smoking in indoor public venues since 2008. (From Beijing Review 25/6/15)

New China/Pakistan jet fighter

The Aviation Industry of China (AIVC) and Pakistan’s Air Force has developed a new jet fighter, the JF-17, which was introduced at the Paris International Air Show on 15 June. The show attracted 2,200 companies from 27 countries. Within the next 10-15 years, AIVC expect between 200 to 300 of the planes will be sold globally. (From Beijing Review 25/6/15)

Beijing’s bid to hold Winter Olympic in 2022

The China Beijing 2022 Winter Olympics bid delegation made a presentation at the Olympic Museum at Lausanne, Switzerland. A decision will be made by the IOC during its 128th session in Kuala Lumpur on 31 July and if successful, Beijing will be the first city to host both the summer and winter Olympics. (From Beijing Review 18/6/15)

Maternal death rate

China’s maternal mortality rate has fallen by 75% over the last 25 years. It was 21.7 per 100,000 in 2014 compared to 88.8 per 100,000 in 1990. China’s National Health and Family Planning Commission attributed the decrease to better medical care and allowances made for rural women to give birth in hospitals. Hospital delivery rate in rural areas was only 36.4% in 1990, but by 2014, the rate had increased to 99.6%. Free pre-pregnancy check-ups and medical care are also believed to have contributed to the improvement. (From Beijing Review 18/6/15)

University rankings

China has overtaken Japan as Asia’s No.1 nation for world-class universities, according to the Asia University Rankings 2015 published on 10 June by Times Higher Education. Some 21 universities from mainland China entered the top 100; this is up from 18 last year. Peking University was in fourth place and Tsinghua in fifth place. Hong Kong had two in the top 10, six in the top 100. Although, Tokyo University was in top place, the overall number of Japanese universities fell to a total of 19, from 21 last year. The Asia rankings are based on 13 performance indicators to asses a university’s strength. (From Beijing Review 18/6/15)

China’s population increases

At the end of 2014, China’s population reached 1.368 billion. There were 16.87 million new births in 2014 compared to 15.92 million in 2010. The increase of about one million is believed to be a relaxation of the family planning policy. The change was adopted at the end of 2013 by which couples nationwide could have a second child if either parent is an only child. China’s working population i.e. people between the ages of 15 to 59 fell to 930 million in 2014 from its peak of 940 million in 2011. (From Beijing Review 23/7/15)

Search and support for talent

The Chinese Academy of Sciences (CAS) will launch a new programme to attract and support urgently needed scientists. The project is called New 100-Talent and is designed to attract 100 scientists from all over the world. They are required to conduct leading-edge research in China and hopefully will have the ability to make an international impact. The programme will offer financial subsidies and support staff for their research and also allow them to cultivate young researchers. Young scientists under the age of 35 with outstanding potential will also be covered by the programme. Programmes to cultivate innovated research has already brought in 2,300 high-calibre scientists from overseas and nurtured more than 3,500 young researchers. (From Beijing Review 4/6/15)

Beijing cleans up step by step

This March, two coal-fired power stations in Beijing closed down, which should slash the use of coal by 4.6 million tons per year. Of four coal-fired power stations in use since the 1950s only one is still in use and this will close by 2017. This is the deadline of Beijing’s first five-year plan (2013-17) on air cleaning to achieve 100% clean power generation. They are being re[laced by four natural gas-fired power stations. Compared to coal-fired units, gas-fired ones are more efficient, occupy a smaller area and produce less carbon dioxide, less oxides of nitrogen and also less sulphur dioxide. All of these are major polluters.

In the first four months of 2015, Beijing had 42% less heavily polluted days, compared to the same period in 2014. Also, the PM 2.5 content was reduced by 19%. The PM 2.5 content during 2014 was more than twice the safe standard laid down by the World Health Organisation. The problem of smog in Beijing is not only bad for the 20 million inhabitants, but it also poses obstacles for Beijing to play an increasingly international role. (From Beijing Review 11/6/15)

SinoFile is compiled by Walter Fung.

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