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Chinese Military,Political and Social Superthread

Dambisa Moyo's recent book Winner Take all: China's Race for Resources and what it means for the World, which is also about China's thirst for resources to feed its growing economy and energy needs, also comes to mind with this article below.

National Post

Is China’s hunger for the globe’s natural resources benign or nefarious?

Excerpt:

Q The book’s title ‘By All Means Necessary’ gives the impression that China will employ all necessary tools to secure resources. Is that the implication?

A It’s not ‘by all means possible,’ but ‘by all means necessary,’ which is different. The title is a nod to the fact this is not just about trade or investment or political relation or military deployment. It is about different tools China uses to secure its economy. The United States, by the same logic, has used all means necessary to secure its natural resources.

Q What are the key takeaways from the book?

A Three big takeaways. First, China’s resource quest is far less coordinated and controlled then people believe. One side says ‘it is nefarious, and therefore bad.’ Others say, ‘the Chinese are not scheming, therefore it is fine.’ The reality is that it’s not nefarious, but it can still be consequential in good and bad ways.

The second is that China at home sets the terms for China abroad. When Chinese companies aren’t required to meet high environmental standards at home, they are not going to be raising the bar when they operate abroad.


The third big takeaway is the counterpoint to the second [point]. The international systems can be very powerful in shaping, and even altering, Chinese behaviour. The international oil trading system has weathered any Chinese desire for bilateral trade.


(...EDITED)
 
The newest addition to China's surface fleet:

China commissions new guided missile destroyer

133204488_13954045448201n.jpg

Chinese Navy officers and soldiers participate in the hand-over ceremony of warship "Kunming" at the port of Jiangnan Shipyard (Group) CO., Ltd in Shanghai, east China, March 21, 2014. Guided missile destroyer "Kunming", with hull number 172, was officially delivered and commissioned to the People's Liberation Army Navy on Friday. (Xinhua/Zha Chunming)
source: xinhuanet.com

The new DDG is the successor to China’s Type 052C DDGs. It displaces between 6,000 and 7,000 tons, and is equipped with a new 130 mm main gun. The Type 052D also boasts Active Electronically Scanned Array (AESA) radar system. It is often compared, perhaps inappropriately, to the much heavier Arleigh Burke-class DDGs and the Ticonderoga-class guided-missile cruisers.
source: thediplomat.com

Type 052D destroyer is an improved version of the Type 052C with 64 Cell Vertical Missile Launch Systems (VLS) for surface to air missiles.
source: navyrecognition.com

Here’s a short YouTube video of the new DDG:

YouTube: China's MOST ADVANCED 052D Destroyer rival to US Navy Arleigh Burke Destroyer
 
Chinese President Xi in Europe:

Defense News

France, China Make Deals, Diplomacy During Xi Visit

Mar. 27, 2014 - 12:02PM  |  By PIERRE TRAN

(...SNIPPED)

French leaders hope the visit will help boost business ties with China, while Beijing sees Paris as an “acceptable friend” in international political crises such as Syria and Ukraine, website latribune.fr reported.

China’s abstaining from a US motion in the UN against Russia because of the Ukraine crisis was a distancing by Beijing from its ally Moscow, latribune said.

Western nations are banned from selling arms to China but France eagerly seeks commercial contracts. President François Hollande said March 26 he wishes to see a re-balancing of trade relations with the Asian nation, Agence France-Presse reported.

The state visit has boosted business for Airbus, with announcements of a commitment for 70 airliners, comprising 43 narrow-body A320s and 27 wide-body A330s. Chinese authorities had previously ordered the A330s but suspended the deal in retaliation against a European plan to tax airlines on carbon dioxide emissions in an anti-pollution effort.

China will also extend for 10 years the local assembly of A320s at the Tianjin plant, while the Airbus Helicopter unit received a pledge for 1,000 of the EC175s built in a Chinese joint venture with the AVIC company.

(...EDITED)
 
Unrest in Hong Kong yet again.

Hong Kong democracy activists go on hunger strike for universal suffrage

By: Agence France-Presse

HONG KONG -- More than a dozen Hong Kong democracy activists, including five lawmakers, said they were starting a hunger strike Friday as they step up their campaign for universal suffrage.

Some 15 protesters began the action as fears grow that Beijing will renege on promises to implement genuine political reform in the semi-autonomous southern Chinese city.

"True universal suffrage! We will fight to the end!" chanted participants, who had pitched tents to hold their protest in the financial district of Central.

"We believe that the people of Hong Kong have to come out loud and clear in terms of public opinion and social movement to fight for universal suffrage," lawmaker Lee Cheuk-yan, and organizer of the hunger strike, told AFP.

China has promised that the city, whose current chief executive is appointed by a pro-Beijing committee, will see a transition to universal suffrage by 2017.

(...EDITED)
 
China's biggest political scandal since the downfall of Bo Xilai:

From Reuters

FIGHTING CORRUPTION IN CHINA | Beijing seizes $14.5-billion from ex-security exec's circle - report
By:  Reuters
March 30, 2014 3:11 PM

BEIJING - Chinese authorities have seized assets worth at least 90 billion yuan ($14.5 billion) from family members and associates of retired domestic security tsar Zhou Yongkang, who is at the center of China's biggest corruption scandal in more than six decades, two sources said.

More than 300 of Zhou's relatives, political allies, proteges and staff have also been taken into custody or questioned in the past four months, the sources, who have been briefed on the investigation, told Reuters.

The sheer size of the asset seizures and the scale of the investigations into the people around Zhou - both unreported until now - make the corruption probe unprecedented in modern China and would appear to show that President Xi Jinping is tackling graft at the highest levels.

But it may also be driven partly by political payback after Zhou angered leaders such as Xi by opposing the ouster of former high-flying politician Bo Xilai, who was jailed for life in September for corruption and abuse of power.

Zhou, 71, has been under virtual house arrest since authorities began formally investigating him late last year. He is the most senior Chinese politician to be ensnared in a corruption investigation since the Communist Party swept to power in 1949.

(...EDITED)
 
S.M.A. said:
China's biggest political scandal since the downfall of Bo Xilai:

From Reuters


And it may be bigger. It is, I am about 99% sure, quite unprecedented to go after retired Politburo Standing Committee members. They have been, until now, "bomb proof." That Xi is doing so seems to me to require more than just a 'hate' because Zhou supported Bo. If it is part of a larger campaign to actually address corruption then I expect "interesting times," ahead, as an old saying suggests.
 
The latest incident in the South China Sea involving the Philippines and China, as reported last week:

Philippine supply ship evades Chinese blockade
quote:

SECOND THOMAS SHOAL (AP) — A Philippine government ship slipped past a Chinese coast guard blockade Saturday and brought food and fresh troops to a marooned navy ship used as a base by Filipino troops to bolster the country's territorial claims in the disputed South China Sea.

(...EDITED)

Associated Press

(Photos below courtesy of the BBC and the Philippine Daily Inquirer newspaper)

Philippine Marines on the grounded transport taunt a Chinese Coast Guard vessel trying to blockade their supply ship:

614x345xayungin-0331.jpg.pagespeed.ic.K6TVSZFjC4.jpg



The Chinese crew instructed the Filipinos to turn away

_73905576_8690cd98-fa22-435c-80bd-78cc5353d93e.jpg


_73905571_2f8e950b-6e66-49d0-af8b-ef4f3819b85a.jpg


Philippine crew members flashed peace signs at the Chinese vessel

_73905573_8ec9ab62-96e3-4bce-8a56-d9ca5ef57cac.jpg


The Philippine supply ship slipped past the Chinese and reached their troops on a rusty beached vessel

_73906124_marines.jpg


These Philippine marines have been stationed aboard the BRP Sierra Madre for the last five months

China-Philippines navy spat captured on camera (BBC link)
 
Evidently no everyone is enthraled by the idea of free trade or more links with China:

http://www.chinapost.com.tw/print/404107.htm

500,000 rally at Presidential Office: protesters
Monday, March 31, 2014
By Lauly Li ,The China Post

TAIPEI, Taiwan -- Hundreds of thousands of student-led protesters dressed in black gathered along Ketagalan Boulevard in front of the Presidential Office in a protest over President Ma Ying-jeou and the Cross-Strait Trade in Services Agreement.
Student activist Lin Fei-fan (林飛帆) claimed over 500,000 people attended the rally, while protesters outside of the Legislative Yuan claimed that they numbered over 700,000 people. The National Police Agency (NPA), however, estimated the number of protesters to be 116,000.

During the rally, thousands of people shouted “reject the Cross-Strait Trade in Services Agreement, defend democracy,” and “legislate the bill first then deliberate the agreement.”

The Rally is a Start: Linv

While addressing the crowds at Ketagalan Boulevard, Lin said the demonstration yesterday was not an end but a start, noting that people should exchange contact information with the person standing next to them and arrange working rosters so people can take turn to go to the Legislative Yuan.

Lin said the reason why the protesters occupied the Legislative Yuan was because the administration has lost its legitimacy.

Lin reiterated the protesters' four demands of the Ma administration, which are rejection of the Cross-Strait Trade in Services Agreement, introduction of the Bill on Pacts between Taiwan and China — a draft bill proposed to supervise the signing of agreements with China — urging the government to hold a “public constitutional meeting,” and demanding all lawmakers listen and stand by people's side.

The rally has been seen as a protest of Ma's press conference on Saturday, where Ma made remarks that protesters described as an “off-the-point” response to their demands.

On Saturday, Ma said that the government cannot retract the agreement. He said, however, that the ruling party is willing to review the agreement article-by-article in cross-committee deliberations at the Legislative Yuan.

The student activists said Ma failed to understand their demands despite their almost two weeks of protests.

Around 4:20 p.m., Lin's co-leader Chen Wei-ting (陳為廷) arrived at the Presidential Office from the Legislative Yuan. Chen said that Ma has not responded to the protester's “core” demands at all.

Not Refusing Interactions with China: Chen

“We are not saying that we refuse to interact with China, but we demand ... that all Taiwanese can participate in the decision-making process on how to interact with China,” Chen said.

“The demonstration today is not just about being against the service trade pact, it is a process in which people strengthen the value of democracy,” Chen stressed.

Lin said that too many people have been focusing on him and Chen, noting that the demonstration does not “belong” to either of them, but to all the students and people participating in the protest. “People are the leader of this demonstration, and the Ma administration needed to be led,” Lin said.

Lin urged President Ma to face the protesters, offer a direct response and make specific promises to people.

The mass rally ended at 7:45 p.m., and most of the protesters had left the area by 8 p.m.

Hundreds of student activists have been occupying the Assembly Hall of the Legislative Yuan since March 18 in protest of Kuomintang (KMT) Legislator Chang Ching-chung's (張慶忠) March 17 decision to cut short the deliberation of the service trade pact, sending it straight to the Yuan Sitting.

Over 2,000 protesters attempted to occupy the Executive Yuan on March 23, but were evicted by riot police on the premier's orders.

The Taipei City Police Department Zhongzheng First Precinct said it received intelligence regarding threats to Lin and Chen, noting that it immediately dispatched police officers to protect Chen and Lin.
 
PLA General Gu Junshan's corruption scandal in the news again...

From REUTERS:

Disgraced China military officer sold ‘hundreds’ of posts
-sources

By BENJAMIN KANG LIM and BEN BLANCHARD, Reuters

April 2, 2014 3:47am

BEIJING - A disgraced senior Chinese army officer is accused of selling hundreds of military positions, raking in millions of dollars, sources with ties to the leadership or military told Reuters, in what is likely China's biggest military scandal in two decades.

In a renewed campaign on graft, Chinese President Xi Jinping has vowed to go after both powerful "tigers" and lowly "flies", warning that the issue is so severe it threatens the ruling Communist Party's survival.

Lieutenant General Gu Junshan, 57, who was sacked as deputy logistics chief of the People's Liberation Army (PLA) in 2012, has been charged with corruption, taking bribes, misuse of public funds and abuse of power, state news agency Xinhua said late on Monday in a brief report without giving details. He will be tried by a military court, it added.

The charges signal the determination of Xi, who has repeatedly reminded the PLA to be loyal to the Party, to pursue wrongdoing in the upper ranks of the military, which wields considerable influence in leadership circles.

The case could overshadow what had been China's most dramatic military scandal, a vast smuggling ring uncovered in the late 1990s in the coastal city of Xiamen involving both the military and government officials. The ringleader, Lai Changxing, was extradited from Canada and jailed for life in 2012.


Three sources with ties to the leadership or military, speaking on condition of anonymity, said one of the key crimes Gu is suspected of is selling promotions.

"Gu sold hundreds of positions," one source with leadership and military ties told Reuters.


Not all officers of the 2.3 million-strong PLA promoted in recent years paid bribes.

(...EDITED)

And more about widespread corruption in the PLA:

Military.com

Chinese Military Inspectors Find Irregularities

BEIJING -- Inspectors have uncovered widespread irregularities and suspected corruption among military units based around Beijing, Chinas Defense Ministry said Tuesday, a sign that a widening anti-graft campaign that is turning to the sprawling 2.3 million-member Peoples Liberation Army.

The ministry said in a statement that the inspections in the Beijing and Jinan Military Regions were carried out directly under the authority of the Central Military Commission, headed by president and ruling Communist Party leader Xi Jinping.

It said multiple leads were obtained concerning problems with the handling of promotions, discipline among officers, land transfers, the construction and allocation of buildings and military medical services.


The ministry said those cases would be further investigated and publicized for their deterrent effect," raising the likelihood that offenders would be brought before military courts.

The announcement said the inspections were carried out between Dec. 10 and March 13, with the initial results presented at a meeting last Thursday.

The PLA has long been dogged by a culture of bribery, corruption and power abuse. Promotions and plum assignments are sometimes secured by providing payments or favors to higher ranking officers and military assets, especially land, used for private economic benefit.

Officers enjoy official vehicles, housing and generous benefits in return for pledging their loyal to the ruling party, rather than to the Chinese state.

The son of a leading Chinese general, Xi is seen as commanding greater authority with the armed forces than either of his two predecessors, although he risks losing some of that support if he comes down too hard on military privileges.

On Monday, the military said it was charging Lt. Gen. Gu Junshan with embezzlement, bribery, misuse of state funds and abuse of power. Gu had been deputy head of the Peoples Liberation Armys General Logistics Department, a position offering him powers over procurement and contracts with which to allegedly amass a vast fortune.

(...EDITED)
 
tomahawk6 said:
Whats the penalty if these crimes are proven ?

Past corrupt officials have been sentenced to harsh prison terms, with some executions occurring as well.

---------------------------------------------------------------------------------------------------------

In the update below, the PRC's president Xi Jinping made it clear that he still stands for a one party system for China.

I would beg to differ with him because Taiwan has a flourishing multiparty system and is a microcosm for what the rest of China might look like one day if they introduced democratic reforms.

Reuters

Xi says multi-party system didn't work for China

quote:

SHANGHAI (Reuters) - China experimented in the past with various political systems, including multi-party democracy, but it did not work, President Xi Jinping said during a visit to Europe, warning that copying foreign political or development models could be catastrophic.

China's constitution enshrines the Communist Party's long-term "leading" role in government, though it allows the existence of various other political parties under what is calls a "multi-party cooperation system". But all are subservient to the Communist Party.

Activists who call for pluralism are regularly jailed and criticism of China's one-party, authoritarian system silenced.


(...EDITED)


Because of its unique historical and social conditions, China could not copy a political system or development model from other countries "because it would not fit us and it might even lead to catastrophic consequences", Xi added.

"The fruit may look the same, but the taste is quite different," he said.


(...EDITED)

Xi's ascendancy in a once-in-a-decade generational leadership transition had given many Chinese hope for political reform, mainly due to his folksy style and the legacy of his father, Xi Zhongxun, a former reformist vice-premier.

But since he assumed office, the party has detained or jailed dozens of dissidents, including anti-corruption activist Xu Zhiyong and ethnic Uighur professor Ilham Tohti.

Reinforcing the message that there will be no liberalization under Xi, the ruling Communist Party's influential weekly journal Qiushi (Seeking Truth)
wrote in its latest issue that there was no such thing as "universal values", adding that China's political system should not be underestimated.

(...EDITED)
 
Neither Beijing nor Tokyo really want war, but yet both sides continue to push the Senkakus/Diaoyus sovereignty issue.

South China Morning Post

Chances of war between China and Japan increasing, says ex-PLA officer Luo Yuan

Retired PLA general says China is ready and rejects claims of Japanese combat superiority, although some analysts are not convinced

A retired People's Liberation Army senior officer says a war with Japan over territorial disputes is becoming increasingly likely and that China is more than capable of defending itself.

Other military experts are not convinced the PLA would win any future conflict, despite China's military build-up and modernisation.

Some cite the PLA's lack of battle experience as well as technological weaknesses in certain areas, aircraft engines for example, that could hinder the PLA's fighting capability.

China and Japan moved closer to armed conflict after Beijing established its first air defence identification zone last November in the East China Sea to include the disputed Diaoyu islands, known as the Senkakus in Japan, Major General Luo Yuan said.

(...EDITED)

 
For information ... reproduced, without comment, under the Fair Dealing provisions of the Copyright Act from China Business Watch:

http://www.businessinsider.com/chinas-new-spaceport-is-about-to-launch-its-biggest-rocket-yet-2014-4
China's New Spaceport Is About To Launch Its Biggest Rocket Yet

LEONARD DAVID, SPACE.COM

China's huge new rocket is headed toward its maiden flight from the country's soon-to-be-complete, brand-new launch center on Hainan Island, at the southern tip of China, far from the nation's mainland.
The combination of the planned rocket, called the Long March 5 — and its derivatives — matched with the Wenchang Launch Center, China's new sprawling spaceport, underscores the country's shifting space gears. It enables China's space station ambitions, while also boosting the nation's plans for interplanetary exploration, as well as accomplishing human treks to the moon.

The new launch facility is extremely important to the future of China's space program, said Gregory Kulacki, senior analyst and China project manager for the Global Security Program at the Union of Concerned Scientists (UCS), based in Cambridge, Mass. [See photos of China's planned space station]

"Not only because of the significantly increased capacity of the new series of wider-bodied rockets that will be launched from there, but because of the changes in Chinese space culture the new facility represents," Kulacki told Space.com.

Kulacki has lived and worked in China for the better part of the last 25 years, facilitating exchanges between academic, governmental and professional organizations in both countries.

Blue water spaceport

In a post last year on the UCS's "All Things Nuclear — Insights on Science and Security" website, Kulacki took a hard look at China’s new blue water spaceport. He said that China's existing spaceports were constructed during a more defensive era when outer space was perceived as the ultimate high ground of the Cold War.

"While some observers may continue to see space as an arena for great power competition, many Chinese space professionals hope to expand international cooperation and collaboration," Kulacki wrote.

"Diverse civil, scientific and commercial space aspirations occupy the imaginations of China's young and rapidly growing space community," Kulacki added. "Military competition remains important, but it may no longer be paramount. Plans for the new spaceport in Hainan embody this change."

China's space center

Kulacki wrote that the island, occasionally referred to as "China’s Hawaii," is well-suited for a space port.

"The facility is being built on the relatively undeveloped northeastern corner of the island in the municipality of Wenchang," Kulacki said. "But instead of preserving or reinforcing the launch site's relative isolation, the city planners are working hard to integrate the space port into the island's tourist infrastructure."

In addition to the island's launch facilities, the spaceport will be surrounded by 37 different development projects, Kulacki said, including a space-related theme park.

photo_2_wenchang_launch_center.jpg


"Roads and other supporting infrastructure are being designed to accommodate two populations," Kulacki said. "The space professionals who will be living and working at what appears to be China's equivalent of the Kennedy Space Center, and affluent Chinese looking to take in a space launch while enjoying a vacation at the beach."

Final piece of the puzzle

China's preparations for the Long March 5's first flight spotlights the difficulty of space engineering as evidenced by its numerous delays, said Joan Johnson-Freese, professor of national security affairs at the Naval War College in Newport, R.I.

“Their willingness to keep at it is also indicative of China’s persistence and will to be an enduring space power,” Johnson-Freese told Space.com. "Having an operational heavy lift launch vehicle is perhaps the most important final piece of the puzzle of hardware requirements necessary to achieve their three-part human spaceflight program laid out in 1993 … as without it they are unable to launch the large space station that has always been the ultimate programmatic goal.”

Johnson-Freese added that it also then gives China options for the future, such as interplanetary space travel, and a human mission to the moon.

Pushing up against deadlines

"The launch of the Long March 5 series will open new possibilities for China's space program," said Dean Cheng, a research fellow on Chinese political and security affairs at the Heritage Foundation in Washington, D.C. "In the first place, it will allow for the orbiting of the Tiangong-2 spacelab, which is slated to go up in 2015." [Read more about China's space program]

The booster is also going to be an essential vehicle for the eventual Chinese space station, sometimes referred to as Tiangong-3, Cheng told Space.com. It will also be necessary for the next generation of Chinese all-weather, high-resolution observation satellites, which are believed to be much larger than the Ziyuan series, he said.

Cheng noted that, given the projected launch in 2015 of the Tiangong-2 and China's 2020 space station, the Long March 5 development timeframe is pushing up against deadlines.

Long March 5 is the largest rocket that China has ever built, with a 5.2-meter diameter. "That poses significant challenges to China’s manufacturing capability, especially as this is being built at a new production site," Cheng said.

"Roads and other supporting infrastructure are being designed to accommodate two populations," Kulacki said. "The space professionals who will be living and working at what appears to be China's equivalent of the Kennedy Space Center, and affluent Chinese looking to take in a space launch while enjoying a vacation at the beach."

Tyranny of their railroads

Regarding China's new launch site, Cheng said it frees China's space program from the tyranny of their railroads: "Now, launch vehicles will no longer be limited by the curvature of rail lines and width of train tunnels."
Cheng added that the launch complex being located on Hainan Island is another reason for China’s focus on the South China Sea.

Hainan is beginning to look like the Soviet Kola Peninsula during the Cold War, Cheng said, given major naval facilities, including submarine pens dug into cliff sides, as well as a carrier facility and air bases, and now a space launch facility.

"China's intention of dominating the South China Sea, the source of so much recent tension, is likely driven in part by the desire to keep foreign militaries far away from this densely militarized territory," Cheng said.

Leonard David has been reporting on the space industry for more than five decades. He is former director of research for the National Commission on Space and is co-author of Buzz Aldrin's new book "Mission to Mars – My Vision for Space Exploration" published by National Geographic. Follow us @Spacedotcom, Facebook and Google+. Original article onSpace.com.
 
Stepping up the fight against corruption is something we should applauded as well, since a more transparent and open China is one we can deal with more easily as well:

http://www.bloombergview.com/articles/2014-04-02/the-real-end-of-china-s-one-child-policy

The Real End of China's One-Child Policy

Adam Minter
Apr 2, 2014 10:01 AM EDT

In January, superstar Chinese film director Zhang Yimou was fined the equivalent of $1.24 million for having three children in excess of the country’s strict, so-called “one-child” family planning standards. It was a significant, possibly record fine, meant in theory to compensate the state for the social and material costs associated with those pesky, extra three lives.

This raises an interesting question: What happens to Zhang Yimou’s $1.24 million? Or more importantly, what's happened to the estimated 2 trillion yuan ($320 billion) in social maintenance fees that millions of other Chinese parents have paid since 1980, according to one study? On Thursday, a court in Guangzhou ruled that the Family Planning Commission of Guangdong Province -- China’s most populous -- must disclose the specifics of its own data within 15 days.

This isn't the kind of information such bodies are eager to reveal, and Guangdong's commission strongly fought the lawsuit demanding that they come clean. They have good reason to resist greater transparency. Last year, for example, Guangdong’s Family Planning Commission claimed to have collected 1.456 billion yuan ($235 million) in “social compensation fees." The province’s Department of Finance, on the other hand, reported that collections amounted to 2.613 billion yuan ($421 million).

What accounts for the difference? Specifics will have to wait until the Family Planning Commission gets around to disclosing details. But the issues are already well-known in China, where such bodies employ more than 500,000 people, and often serve as critical revenue generators for cash-strapped poorer provinces.(Local governments enjoy wide latitude in assessing fines, and generally do so on the basis of income.)

The problem, according to Chinese media reports, is that quite a bit of that revenue doesn't seem to land in government treasuries. In rural Yunnan Province, for example, audits suggest that in one county as little as 10.18% of social compensation fees flowed into government coffers. In Chongqing, 68 million yuan ($11 million) worth of social planning fees failed to find their way to the treasury.

Needless to say, the stench of corruption hangs heavy over such discrepancies. In Yunnan, officials were found to be using social maintenance fees to pay for personal expenses, including medical bills. In some regions, local authorities allow officials who collect the fees to keep a certain percentage of them. The situation -- whereby officials are incentivized to hunt down children for their revenue-generating potential -- is both untenable and perverse.

It is also entirely contrary to China’s family planning goals under President Xi Jinping who has transformed the “one child” policy to allow Chinese parents to have second children under certain circumstances. The need is pressing: Three decades of population control has left China with a rapidly aging population and not enough young workers to support them. Under such circumstances, it’s counter-productive (as well as deeply unpopular) to allow thousands of bureaucrats to roam China in search of family planning violations.

Indeed, as early as March 2013 -- just a few months into Xi’s term -- he began to undermine the power of China’s national Family Planning and Population Commission by merging it with the Health Ministry and stripping it of several traditional responsibilities. Still, in contemporary China, nothing signals the end of a government career -- even a powerful one -- quite like a full public accounting of one’s finances. After operating for decades in the darkness, China's family-planning agencies are about to learn how much harder it is to work out in the open.

(Adam Minter is a regular contributor to Bloomberg View based in Shanghai and the author of "Junkyard Planet," a book on the global recycling industry. Follow him on Twitter at @AdamMinter.)

To contact the writer of this article:
Adam Minter at shanghaiscrap@gmail.com

To contact the editor responsible for this article:
Nisid Hajari at nhajari@bloomberg.net
 
We are, generally, aware of the fact that California (population 38 million), for example, has the 8th largest economy in the world ~ on a par with Canada (pop 35 million) and Italy (pop 60 million). What about China, the third largest economy in the world?

The Economist has produced this informative inforgraphic showing how China's individual provinces compare, in GDP, to various countries:

BkcZ0kSIIAA4SsC.jpg:large

Source: The Economist Intelligence Unit
 
China's plans to create a world-class shipbuilding industry hit a snag.

Reuters

Deadbeat Chinese shipyards stick banks with default bill
Reuters
By Pete Sweeney

SHANGHAI (Reuters) - Chinese banks are stuck in a lose-lose legal battle between domestic shipyards and foreign buyers over billions of dollars in refund guarantees that are supposed to be paid out if shipbuilders fail to deliver on time.

One in three ships ordered from Chinese builders was behind schedule in 2013, according to data from Clarksons Research, a UK-based shipping intelligence firm. Although that was an improvement from 36 percent a year earlier, it was well behind rival South Korea, where shipyards routinely delivered ahead of schedule the same year.

That means Chinese banks may be on the hook to pay large sums to buyers if the yards can't come through per contract, with little hope of recouping the cash from the yards. China is the world's biggest shipbuilder, with $37 billion in new orders received last year alone. Buyers pay as much as 80 percent of the purchase price upfront.

Chinese bankers rushed to finance shipbuilding after the 2008 global financial crisis as Beijing pushed easy credit and tax incentives to lift the industry and sustain industrial employment levels in the face of collapsing exports.

Fees generated by offering such guarantees looked like easy money until massive oversupply and falling demand started taking a toll on the yards around 2010. Shipyards fell behind schedule and buyers demanded their money back. But behind or not, the builders, keen to keep orders on the books and prepaid money in their pockets, have submitted injunctions against banks in Chinese courts to prevent them from paying out.

"China's ambitions to take over South Korea as the top major shipbuilder meant that all the banks were encouraged to open up their wallets and lend money to the shipbuilders without making thorough due diligence," said AKM Ismail, former finance director for Dongfang Shipyard, the first Chinese shipyard to be listed on London's AIM Stock Exchange in 2011.

Since ships cost millions of dollars and can take years to deliver, a shipbuilder generally asks for part of the purchase price upfront to cover material and labor costs. Buyers normally obtain a refund guarantee from a bank to assure their money is returned if the yard defaults, and the yard pays the bank's fee for the service.

(....EDITED)
 
Thucydides said:
Stepping up the fight against corruption is something we should applauded as well, since a more transparent and open China is one we can deal with more easily as well:

Speaking of which: Pres. Xi does a little "house-cleaning" ...

From the New Yorker

April 2, 2014

China’s Fifteen-Billion-Dollar Purge
Posted by Evan Osnos

(...SNIPPED)

This is, in effect, what we’re seeing in China today, and the question is what kind of political culture the purge will leave behind.


In less than two years, the Chinese government has brought low one of its most powerful figures: the former oilman and security hawk Zhou Yongkang. Zhou was not the Vice-President, but, as recently as the beginning of 2012, he was “arguably the most powerful man in China,” as the Financial Times put it. Born in a village of beet farmers, he rose through the ranks of the China National Petroleum Corporation and reached the highest levels of the Communist Party: the Standing Committee of the Politburo, where he gained control of domestic security. He was responsible for a vast apparatus dedicated to spying on China’s citizens and putting down protests, and he enjoyed a larger budget than that of the military. (As a result, in the words of the F.T., “his trove of compromising secret files on influential people drew comparisons to another American: J. Edgar Hoover.”)

But today Zhou is poised to become the most senior official to be removed on corruption charges since the birth of the People’s Republic, in 1949. After months of rumors, the purported details of Zhou’s collapsing empire have been widely published in recent days, a sign that the government is preparing to make his arrest public. According to various reports, at least ten of Zhou’s relatives have been detained, included his brother, his wife, and his son. His son’s wife, a Chinese-American named Fiona Huang Wan, who once co-produced a Chinese television series called “Police Story,” has been unreachable since October, her mother told a reporter.

The purge has extended to offices that were once out of the reach of ordinary anti-corruption campaigns, reportedly encompassing Jiang Jiemin, formerly the chairman of both the state energy giant PetroChina and its parent, China National Petroleum Corporation, and Li Dongsheng, a propagandist turned vice-minister of public security. Li was a senior official in the state television system, where, the F.T. noted, his duties reportedly included introducing senior Party leaders “to attractive young female reporters and anchors from the station.” (Zhou is married to a former television host.)

In all, more than three hundred relatives, allies, and associates have been detained in the past four months, according to Reuters.
Investigators have frozen bank accounts; seized securities, jewels, and gold bullion; and “confiscated about three hundred apartments and villas, antiques and contemporary paintings and more than sixty vehicles.” Even by the standards of Chinese-élite politics, the haul is impressive; Reuters reports that the seized assets have a combined value of at least ninety billion yuan—fifteen billion U.S. dollars. There is much that we still don’t know about these assets—how many of them are held by businesses, for instance, and which are tied directly to the Zhou family—but it’s worth pausing on the fact that a group of Chinese civil servants and their associates seem to have accrued a nest egg that is somewhat larger than the gross national product of Albania.

Now on to the questions: Why take Zhou down now? For President Xi Jinping, Zhou’s downfall serves both practical and strategic purposes. The Zhou network runs powerful entities, including oil, gas, and security, and Xi’s maneuver means that he can shore up his authority by replacing Zhou’s allies with his own loyalists, as well as scare low-ranking fence-sitters into something closer to coöperation.

On Monday, in a parallel case, Xi’s government charged Lieutenant General Gu Junshan with bribery, embezzlement, misuse of state funds, and abuse of power in what Jonathan Ansfield, of the Times, says “may be the biggest corruption scandal to engulf the Chinese military.” In recent years, it has become an open secret that the People’s Liberation Army is riddled with bribery, corruption, and for-sale jobs. General Gu, who was the deputy chief of the Army’s logistics department—a position that gave him sweeping control over procurement in the world’s largest army—was said to be one of the most diligent practitioners of the buying and selling of rank. When investigators raided his home village, they needed four trucks to cart off his baubles, which reportedly included a gold statue of Chairman Mao. For a President who has vowed repeatedly to give China a more powerful military presence in the world, an army racked by corruption was another practical problem that needed to be solved.

Strategically, Zhou and Gu are among the largest targets on the block; if Xi is going to take down anyone in his anti-corruption drive, he gains the most authority by going after the biggest names. By confronting high-ranking “tigers,” as he calls them, he hopes to put a symbolic face on a campaign that has also resulted in the detention of tens of thousands of low-ranking “flies.”

Will this work? By highlighting spectacular acts of kleptocracy, doesn’t the Chinese President run the risk of outraging the public more than satisfying it? The answer, of course, is yes, which underscores the radical gamble at the heart of Xi’s bid to restore the credibility of the Communist Party in the eyes of Chinese citizens.

(...EDITED)
 
Isn't the writer of this article pretty much just reiterating Gordon Chang's The Coming Collapse of China?

The China Superpower Hoax

Huffington Post

China must have the best public relations maestros in the world. How else would a country with a lower per capita income than Iran, Mexico and Kazakhstan, one of the worst environmental records of any major nation, endemic corruption, jails stuffed with dissenters, and a dictatorship, besides, be hailed by so many as the next global superpower?

Certainly China is big -- 1.3 billion people big, a fifth of the global population. As Forbes' columnist John Lee has written, China has long been the place for the world's biggest anything: the Great Wall, the 2008 Olympics, Tiananmen Square, the South China Mall in Dongguan, dams, consumption of cement and production of automobiles; most recently, China even had the world's biggest traffic jam -- an incredible 60 miles long -- which lasted a month and during which drivers were stuck in their cars for days at a time.

(...SNIPPED/EDITED)


Unfortunately, the hype ignores a starker reality -- that China is barely holding it together.
Contrarian voices like Hu Ping, the chief editor of Beijing Spring, a pro-human rights and democracy journal, try to humanize the conventional wisdom of economic statistics and facts that obscure reality. "With China portrayed in the news every day as an economic and political powerhouse, the rest of the world, at least those parts that treasure freedom and peace, should pay attention to the real China," says Hu

(...SNIPPED/EDITED)

Because of China's climate of corruption and authoritarian secrecy, even the volume of industrial output has been questioned. Some doubt China's numbers and official reports. Investment guru James Chanos, who rose to prominence when he predicted the Enron meltdown (and pocketed a billion dollars shorting Enron stock), is shorting China now.

Says Chanos, "China is cooking its books. State-run companies are buying fleets of cars and storing them in parking lots and warehouses" to pump up state-mandated production figures. As evidence of this, experts point out that while car sales have been rising by a huge 20 percent per month, auto fuel usage seems to be rising by only 3-5 percent per month. Chanos also says China is plagued by an ominously growing real estate bubble in high-rise buildings, offices and condos. Much of China's high growth originally came from decades-long heavy investment in infrastructure, but increasingly it has been coming from construction. Chanos estimates that 50 percent to 60 percent of China's GDP now comes from alarming levels of overbuilding, virtually none of which is affordable to the average Chinese. "This is not affordable housing for the middle class; this is high-end condos in major urban areas and high-end office buildings, which no one is buying," says Chanos.

China is on this "treadmill to hell," he says, because so much of its GDP growth comes from construction which can't be sustained. If China were to slow down the construction industry, its GDP growth would go negative very quickly.
 
Gordon Chang again...

China Property Collapse Has Begun
Gordon G. Chang


Nothing is going right for Hangzhou at this moment.  Walmart will be closing its Zhaohui store in that city on April 23 as a part of its overall plan to dump marginal locations - about 9% of the total - in China.

Thanks to the world’s largest retailer, another large block of space in Hangzhou, the capital of Zhejiang province, will go on the market at a time when there is generally too much supply.

The real weakness, however, is Hangzhou’s residential sector.  The cause is simple: massive overbuilding. The real estate market in Hangzhou looks like it has just passed an inflection point.  It is not so much that fundamentals have deteriorated - they have been weak for some time - as that people’s mentality has changed.

Official statistics do not seem consistent with the general trend of reports, but in any event severe problems are evidently ahead.  The secondary property market has tumbled, with sales falling by more than half in Q1 2014 from the same quarter in 2013.  Speculators have either left the domestic market or have sold off holdings.  Rich Chinese, now interested in foreign holdings, are also shunning their home market.  Foreigners, who own only an infinitesimal portion of China’s property but who are a bellwether nonetheless, are investing at the slowest pace in at least a decade.  Middle class Chinese are also largely out of the market.

China is at the point where problems are feeding on themselves.  Pessimism about property, which accounts for about 15% of China’s gross domestic product, is beginning to affect the broader economy.  Declining property values look scary, despite cheery statements from government officials who assure us the property bubble is “not big” or analysts who say that the problems are not “systemic.”  But the Chinese don’t look like they are buying either of those views.  “If this continues, it will have immense impact on the whole Chinese economy,” says an unidentified Hangzhou real estate salesman on Economic 30 Minutes.  “Without question, everyone thinks there is a bubble.”

Premier Li Keqiang has a few tools at his disposal, but they look insufficient to stop a general collapse of property prices across the country.  The problems, deferred from late 2008 with massive state spending, have simply become too large.  And we must remember that he works inside a complex, collective political system that is generally unable to meet challenges swiftly.

But that does not matter.  There is little any leader can do.  Collapses occur when people lose confidence.  That is now happening in China.


Forbes
 
Perhaps an economic downturn may dampen the sabre-rattling over the Senkakus/Diaoyus?

The Diplomat.com

China Slows – Will Asia Follow?

(thediplomat.com)
April 18, 2014

As the region’s largest economy slows, what impact will it have on the rest of Asia?

Quote
China’s slowdown has been confirmed, with the world’s second-biggest economy reporting its weakest expansion in more than a year on slumping property construction. But the rest of Asia won’t be following its lead just yet, according to the world’s bankers.

<snipped>

While the gross domestic product (GDP) data buoyed financial markets, ANZ economist Liu Ligang was not alone among economists in questioning the high number.

“If you look at monthly indicators then I think growth was really around 7.2 percent, given retail sales and fixed asset investment have been weak,” the bank’s chief China economist told the Australian Financial Review.

He pointed to the “significant slowdown” in housing construction, which plunged by more than 27 percent during the January-March quarter, compared to the same period last year. New home sales also dropped 7.7 percent, while there was a 23 percent rise in new dwellings yet to be sold.

(...EDITED)
 
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