The Sinocism China Newsletter For 04.24.13

"Sinocism is the Presidential Daily Brief for China hands"- Evan Osnos, New Yorker Correspondent and National Book Award Winner

Tensions have flared again over the disputed Diaoyu/Senkaku Islands.

Bloomberg reports that Abe Vows to Protect Isles as Shrine Visits Hurt Japan-China Ties:

Japanese Prime Minister Shinzo Abe vowed to use force if necessary to defend islands also claimed by China as tensions rose over visits by his fellow lawmakers to a Tokyo shrine seen in Asia as a symbol of wartime aggression.

China and Japan each issued formal protests today over the presence of each other’s vessels in waters around the islands, which lie in an area rich in resources including fish and oil. Abe today told a parliamentary committee that the government would not allow any Chinese boats to land on them.

Xinhua reports that a Chinese fleet drives Japanese boats away from Diaoyu Islands:

A fleet of Chinese marine surveillance vessels has driven Japanese fishing boats out of waters surrounding the Diaoyu Islands, the State Oceanic Administration said Tuesday.

The Chinese fleet’s enforcement of the law had forced the Japanese fishing boats out of waters surrounding the islands as of 10 a.m., thwarting the attempts of “Japanese right wingers,” the administration said in a statement on its website.

The good news is that the fleet consisted of marine surveillance vessels. China has still not sent PLA Navy ships within twelve miles of the islands. Official media reports on the Yasukuni Shrine visit and the vessels’ approach to the islands have actually been fairly restrained, nor has either topic become one of the top ten on Sina Weibo. Most attention is still focused on the Ya’an earthquake. 日本右翼分子非法进入钓鱼岛海域_新闻频道_央视网 is the Tuesday CCTV Evening News report on the Japanese “rightists” near Diaoyu Islands.

Perhaps the relatively restrained response is also related to the ongoing visit of Martin Dempsey, chairman of the U.S. Joint Chiefs of Staff? On Tuesday General Dempsey met with Xi Jinping (Chinese president meets U.S. top military officer – Xinhua  人民日报-习近平会见美军参联会主席登普西) and a ratcheting up of tensions while he is here might be awkward.

The Asahi Shimbun quotes a Chinese official who feels aggrieved, perhaps because it sounds like the Chinese side believed the relationship had stabilized and was willing to tolerate some shrine visits, but not one by the deputy prime minister:

The Chinese government apparently anticipated that some ministers will visit, but Aso’s action baffled officials.

“It is hard to believe that the deputy prime minister paid a visit,” said an irate official in charge of Japan policy. “Is Japan going to complicate bilateral relations further?”

This latest flareup will probably pass, unless Beijing decides to use it as a pretense to further press its islands claims, perhaps by sending in PLA ships or landing people on the islands. But even if it passes, the relationship is deeply damaged and there is no reason to be optimistic it will improve beyond a wary status quo. Bloomberg presses this point in No Tee Time for Japanese Shows Depth of Toyota China Slump: Cars:

Discrimination against Japanese is common in China, according to Yasuhide Mizuno, the head of Honda’s venture in Wuhan, some 500 miles (800 kilometers) up the Yangtze River from Shanghai. Mizuno — who has also been assigned to Thailand, Taiwan, Malaysia and Australia — says he’s never worked in a more hostile place.

Japan expert Sheila Smith has written a very useful “contingency planning memorandum” on  A Sino-Japanese Clash in the East China Sea (Council on Foreign Relations).

Apple reported Q2 earnings Tuesday afternoon and China was one of the few bright spots, though it was not even that bright. From the Wall Street Journal’s Live Recap: Apple Reports 2Q Earnings:

Q: What are some thoughts on the stickiness of customers in China?

Cook: We actually had our best quarter ever in China. Revenue came in at $8.8 billion, including retail stores. That’s up 11% year-on-year. The highlights for the quarter in China were that iPads grew 138% year-on-year. If you look at revenue on a sell-through basis, our Greater China revenue was up approximately 18%, so it’s a bit better than it first looks. In the year-ago quarter, we launched the iPhone 4S with China Unicom in January and China Telecom in March. This year, the iPhone 5 launched in December, so it’s a different set of dynamics.

Going forward, we still see a significant opportunity in China, it’s a great market. We expect to double the 11 stores there in less than 2 years. This number is obviously too low, currently. We’re also innovating in the online store there. China has an unusually large number of potential first-time buyers, and that’s not lost on us. We’ve seen significant interest in iPhone 4 and we’re making it more attractive to first-time buyers.

Apple has an amazing business and has been far more successful than just about every other foreign firm in China, but 20% quarter-on-quarter, 8%  year-on-year China revenue growth is actually not that positive considering the quarter included the gift-heavy Chinese New Year and it was the first full one in which the iPhone 5 and iPad Mini were officially for sale in China.

Cook sounds like he is hinting that Apple will launch a cheap iPhone 4 to move down in the market and capture more mid-market buyers. One of Apple’s challenges in China is that the iPhone had such explosive success here because it was not only a great phone but also a bling fashion item. Now there are plenty of great phones, and the iPhone 5 form factor’s similarity to the 4/4S damaged some of its cachet.

If Apple now decides to go down market without also launching a new, high-end phone with a new and clearly differentiated form factor then the company risks losing the top end of the market while hurting margins in the mid-tier, extremely competitive market. There is very little handset loyalty in China and the iTunes ecosystem lock-in dynamic that helps Apple in other markets basically does not exist here.

Most companies can only dream of Apple’s China business, but investors should be concerned about the prospects for the company here over the next several quarters.

Hard to believe April is almost over. If you have not yet contributed please consider doing so before the end of the month. Thanks.

Today’s Links:


人民日报-中共中央政治局常务委员会召开会议 进一步全面部署四川芦山抗震救灾工作 中共中央总书记习近平主持会议并发表重要讲话 Politburo meeting, “important speech” from Xi Jinping about earthquake rescue work// After China Earthquake, a Debate Over Who’s Donating What – China Real Time Report For all the argument and criticism, many called for those online to concentrate on helping people, instead of fighting with each other. In that light one of the most persuasive voices came from popular Sina Weibo commentator Zuo Ye Ben, who wrote on Sunday: “Suspend the mutual attacks, suspend the slander and abuse, even stop the debating and relax. Those starting rumors and faking contributions…will have people take them out one by one after the disaster is settled… // 红会社监委下月拟重新调查郭美美事件|郭美美|红十字会|芦山地震_新浪新闻 Red Cross to reopen Guo Meimei investigation //  Chinese in Earthquake Zone Flock to WeChat as Calls Fail – Bloomberg Apps from Internet companies including Tencent and Sina Corp. (SINA) have become an important tool for Chinese to locate relatives and help rescue efforts in natural disasters. Government agencies have also recognized their merit. After the April 20 quake, the Chengdu government posted a message on Sina’s Weibo, a Twitter-like service, urging people to cut down on phone calls and use WeChat, Weibo or text messages to save resources for rescue operations. // 关注雅安芦山地震:走进帐篷医疗区_关俊龙_博联社  photos of temporary tent hospital in front of ya’an #37 military hospital set up to handle overflow of earthquake victims

China’s Recovery Falters as Manufacturing Growth Cools – Bloomberg The preliminary reading of 50.5 for a Purchasing Managers’ Index (EC11CHPM) released by HSBC Holdings Plc and Markit Economics compared with a final 51.6 for March. The number was also below the median 51.5 estimate in a Bloomberg News survey of 11 analysts. A reading above 50 indicates expansion.

Goldman Says Chinese Stocks Appeal as Valuations Bottom – Bloomberg We are probably at the trough of the earnings and valuation cycle,” Alina Chiew, head of Greater China equity at the New York-based bank’s asset management arm, told reporters in the city yesterday. “It’s a very interesting time to get into it.” While the Hang Seng China Enterprises Index (HSCEI), which tracks stocks trading in Hong Kong, has slumped 8.8 percent this year, member company earnings rose 1.7 percent in the three months through March 29, the first uptick since June, data compiled by Bloomberg show. The Bloomberg China-US Equity Index (CH55BN) of 55 Chinese stocks in the U.S. has dropped to 12 times estimated earnings, almost 50 percent below its valuation in March 2012. // Stalling Economy Slams China’s Stocks – FWIW the cake shop driver says his technical analysis teacher says don’t go back into stocks until shanghai closes below 2150…he sold all his shares around 2350// Fund managers have been selling for eight consecutive weeks. They have yanked $3.1 billion from Chinese equity funds through the period ended April 17, after putting in $3.6 billion in the eight weeks before that, according to data provider EPFR Global. The recent selling has helped fuel a sharp selloff in Shanghai and Hong Kong, pushing those markets into losses for the year and making them among the worst performers in the world.

Rhodium Group » China’s International Investment Position: An Update China’s balance of payments shows a dramatic change in cross-border capital flows in 2012. The financial account as a whole swung from a surplus of $260 billion in 2011 to a deficit of $21 billion in 2012. This was the first financial account deficit since 1998, when the Asian financial crisis triggered capital outflows. This shift was widely seen as evidence of capital flight in reaction to a slowdown in economic activity in the first two quarters of 2012. A dissection of the financial account shows that the reality is less portentous, having mostly to do with changing near-term perceptions about currency appreciation in combination with more freedom for firms and households to hold onto foreign exchange instead of surrendering it immediately to the central bank. 

China confirms 108 H7N9 cases, 22 deaths – Xinhua | During the 24-hour period ending at 4 p.m. on Tuesday, China confirmed four new cases of human H7N9 avian influenza, including two in Zhejiang, one in Anhui and the first case in Shandong. The National Health and Family Planning Commission said in its daily update on H7N9 cases that a total of 108 H7N9 cases have been reported in China, including 22 that have ended in death.

Authorities Seek to Clean Up Bond Market – Economic Observer  Provincial auditing departments in China are hoping to clean up the country’s bond market. The investigations of abnormal transactions are going further and deeper than those in the past. According to an official from a local auditing department, the National Audit Office (国家审计署), Ministry of Public Security (公安部), National Development and Reform Commission (发改委) and The People’s Bank of China (中国人民银行) are working together with no end to the investigation in site. Provincial auditing departments have been barred from accepting unauthorized interviews on this topic.  The investigation aims to rectify a complex practice fund managers use to cheat their clients known as “substitute holding,” which enables them to illegally skim profits on bond trades. The auditing official said that the current investigation came as a result of a case involving a Shanghai Auditing Bureau (上海审计局) official. Several financial industry executives have already been arrested. // 债市已成“惊弓之鸟 ”寄望央行“定调”_财经频道_一财网 debt markets worried over ongoing investigation, first financial has details of a recent PBOC meeting with the big banks and securities firms

China Still Committed to No First Use of Nuclear Weapons – All Things Nuclear Unfortunately, while Mr. Acton pleads for greater U.S.—China dialog on nuclear weapons policy his op-ed perpetuates a fundamental misunderstanding that inhibits progress. Productive dialog on nuclear weapons issues between the United States and China requires a change of heart on both sides of the table. The United States needs to set aside its doubts about China’s commitment to no first use and China should stop insisting the United States adopt the same policy. Continuing to make no first use the focus of the talks will only condemn them to continued failure. // China Will Not Change Its Nuclear Policy | CHINA US Focus Yao Yunzhu, director of China-America Defense Relations, Academy of Military Science // For nearly half a century, China’s NFU pledge has served as the cornerstone of its nuclear policy, and any change has required careful review and thorough debate. It is better for China and the rest of the world for China to uphold its NFU policy, rather than discredit such a commitment. To alleviate China’s concerns, a constructive approach would be to assure the policy through nuclear policy dialogues, to establish a multilateral NFU agreement among all the nuclear weapon states, and to consider limiting or even prohibiting the use of nuclear weapons in a legally binding international agreement. //  中国重申始终恪守绝不首先使用核武器的承诺 – 新华国际 – 新华网 新华网日内瓦4月22日电(记者 王昭 刘美辰)中国外交部军控司司长庞森22日在日内瓦表示,中国将始终恪守在任何时候和任何情况下不首先使用核武器的承诺。当天在日内瓦万国宫举行的《不扩散核武器条约》第九次审议大会第二次筹备会一般性辩论中,中国代表团团长庞森表示,《不扩散核武器条约》已成为国际核不扩散机制的基石,在防止核武器扩散、推动核裁军、促进和平利用核能等方面发挥着不可替代的作用。

Beware: British Pedophile & Possible Child Rapist At Large In China : China expect more of this..most of the foreign schools and English training centers do not do any kind of background checks// The man worked in an International School in Beijing and is now wanted by British authorities in connection with the distribution of indecent images of children and the rape of a child. He is still possibly lurking in Beijing or elsewhere in China. Due to the limitations of his visa he is unlikely to have traveled abroad. Since Chinese schools don’t perform background checks on foreign teachers the man is likely working for another school at the moment and possibly committing acts of a criminal nature to Chinese children. For the public image of expats in China, and for the sake of potential victims, if you spot this man please alert your local Chinese authorities. Thank you.



Quake hardly jolts China’s economy – Xinhua The reconstruction of quake-hit areas will help boost local economies as consumption demand rises, and more importantly, offer a trial zone for the country’s urbanization drive, a channel to tap domestic demand, analysts noted. Lian Ping, chief economist at the Bank of Communications, said the government shall seize the opportunity to build new counties that feature low-carbon, environmentally-friendly and green concepts, a target outlined in the country’s development plan. During a March inspection to Jiangsu Province, Premier Li Keqiang elaborated on the significance of new counties, saying they are an important link between the city and the countryside.

Yum profit beats even as bird flu batters China sales | Reuters Sales at established restaurants in China fell an expected 20 percent during the first quarter and Yum warned that fears surrounding a bird flu outbreak there were continuing to depress sales already struggling to recover from a previous food safety scare. The fast-food operator reaps more than half of its overall sales in China, where most of its nearly 5,300 restaurants are KFCs.

A Rough Guide to Predicting the Next Big Bailout, Courtesy of China – China Real Time Report – WSJ Real estate agents who help Chinese investors buy homes abroad say they can guess which country is facing financial ruin by the level of restrictions attached to their investment immigration programs…Two of the newly trendy destinations for Chinese immigrant investors: Portugal, which is struggling to secure €2 billion in bailout funds and the Caribbean nation of St. Kitts and Nevis, which is laboring under mounds of public debt amid shrunken tourism revenue.

KPMG chief dismisses ‘one-day wonder’ scandal – Mr Andrew also played down the significance of the battle between US and Chinese regulators over whether the SEC should have access to audit work papers from the China units of US auditors. “No one treats this as a burning issue, we assume it will be sorted,” he said, adding that the dispute is not affecting the decision of Chinese companies over whether to list in the US.

With $5.4Bln Debt, China’s LDK Solar Sparks Fears Among Creditors-Caijing Analysts are expecting a forced restructure of LDK, de facto insolvent.The solar manufacturer defaulted on a $24 million bond last week, almost a month after rival Suntech Power Holdings Co Ltd defaulted on its bonds

“World’s Factory” Regains Momentum: Dongguan Recorded 8.6% Q1 Growth-Caijing Dongguan, the city known as the “World’s Factory” in South China’s Guangzhou Province, reported a much-stronger-than-expected economic growth in the first quarter, pointing to a robust recovery in its manufacturing hard hit by the financial crisis five years ago. The city reported a preliminary GDP of 110.77 billion yuan for the first three months, representing a year-on-year growth of 8.6 percent, compared with 1.3 percent for the same period in the previous year, according to a conference held by the Dongguan Municipal government.

房产税试点近期或扩围 hangzhou to be the next pilot city for property taxes?// 知情人士称,杭州可能成为继上海、重庆之后,第3个试点向住宅征收房产税的城市。按照杭州市上报的方案,房产税从家庭第二套住房起征,存量房免征。其中,人均60平方米以上的普通住宅的拟征税率为4%,豪宅的拟征税率为8%。该方案拟订的存量房免征原则以及两档税率划分与上海的房产税试点方案相似。有消息称,杭州市的房产税试点方案最快将于本月内出台,5月起开始征收。

Stock Scandal Highlights Flawed IPO Procedures-Caijing  Wanfu Biotechnology (Wanfu), an otherwise little known rice processing and sugar production company which has been listed on China’s Growth Enterprise Market (GEM) since 2011, was recently found to have grossly inflated its revenue and profits for 2008 through 2011. It is not uncommon for companies to exaggerate their financial performance in the capital market, but what Wanfu did, fabricating about 50 percent of its operating revenue, almost all of its operating profit, and nearly 90 percent of its net profit, was unprecedented.



Politburo Holds Seminar on Handling Corruption – The Politburo held a seminar on April 19 intended to draw lessons about handling corruption from the country’s history. This is the fifth seminar that has been held by the Communist Party’s 25-member Politburo since it was formed late last year and the first to touch on graft.

Chinese city court official dies in Communist Party anti-graft probe, family suspects abuse – The Washington Post A senior official at a city court in central China died under mysterious circumstances Tuesday, his body bruised after 11 days in the custody of anti-graft investigators of the ruling Communist Party, his family said. Jia Jiuxiang, who was vice president of the Sanmenxia City Intermediate People’s Court in Henan province, is the second case in two weeks to surface of an official dying while being held in the party’s secret detention system, which is not regulated by law.//even folks on the inside not safe, at some point that becomes a real impetus for making progress towards to rule of law…they can’t all, nor do most want to, run overseas

江苏遭围堵官员下跪原因成疑 官方称为维持秩序|江苏泰州|围堵|污染项目_新浪新闻 perhaps more to the kneeling, crying official in taizhou…local anger brewing for yeas over pollution from nearby chemical plant?//  中国青年报记者采访此事的相关各方后发现,“主任下跪”一事的真相扑朔迷离。而这一“罗生门”的背后,一场官民围绕化工厂污染项目的利益博弈,浮出水面。// 泰州下跪官员引舆论关注 “免职”遭质疑《新京报》也提出了这样的意见:“要想真正彻底地让权力告别嘴边腐败,就必须不能再让权力以虚伪和阴险的姿态来蒙混民意,必须让步常态化的制度监督。比如,不能让公款吃喝报销太容易太方便了,纪委或审计等部门在相关财务核查方面,不能再留存太多松动空间。”网友“为什么不民嘱”提出:“虽然为老百姓出了一口气,但还有更 多的贪官正在这样挥霍,最终还是要政府出台相关制度或修改现有制度来约束制裁这类行为才是解决问题的根本之道。”

人民日报-“强势监督”是对权力的警示(人民时评) 王伟健 People’s Daily making hay with the gluttonous, weeping, now fired Taizhou official.. the angry mob has its uses to curb official gluttony but is very dangerous to rely on the mob to fight corruption…ends with reiterating Xi’s call to “put power within cage of regulations” // 而从自发围堵到微博曝光,群众的监督情绪和方式更启示我们,这是一个“权利时代”,群众对知情权、参与权、监督权、表达权的要求日益高涨。接受群众的监督、适应群众的表达,理应成为领导干部工作甚至生活的基本语境。不仅是在吃喝等作风问题上,更是在行政过程的每一步,不管决策、执行还是监督、反馈,只有适应这样的变化,把权利放在首位,才能免于被围堵甚至“被下跪”的结局。 在此事件中,群众的围堵和曝光,不仅让公款吃喝者付出代价,更为自己争取到表达权。然而,让群众抓吃喝,和让社会盯公车、让网络找手表一样,再热闹也只是个案,更重要的也更根本的,应是“把权力关进制度的笼子”。//been plenty of warnings in official media about curbing official gluttony over the last few weeks, would not be surprised to start seeing to seeing stories about officials caught and punished for it

司法腐败是“正义之痛” 责任追究不能有“窟窿”–舆情频道–人民网 People’s Daily Public Opinion channel has some interesting reports // 从新闻曝光源头分析,本周网民举报表现平平,没有因网络举报掀起反腐风暴的重量级舆情事件发生,媒体曝光和纪委主动介入成效卓著,多地公款浪费被曝光,多名干部因作风问题遭调查。反腐领域方面,因温州24岁女镇长引起关注的干部升迁、铁岭监狱乱象涉及的司法腐败、媒体关注的三公整治和纪委调查的纠风问题是本周舆论热议的焦点。..严厉问责是危机应对的题中之义,辽宁铁岭监狱及其管理部门接下来如何应对,公众们仍然在密切注视。让人民群众在每一个司法案件中都感受到公平正义,是司法领域“中国梦”的题中之义,主管部门要时刻谨记,不能让习总的中国梦蹈空。

原兵工集团总经理张国清调任重庆市委副书记_新闻_腾讯网 Zhang Guoqing is the new deputy party secretary for Chongqing, previously CEO of Norinco  // 中共中央批准,张国清同志任重庆市委委员、常委、副书记,张轩同志(女)不再担任重庆市委副书记、常委职务,马正其同志不再担任重庆市委常委、委员职务,另有任用。

Tensions flare in remote Sichuan village waiting for quake relief | South China Morning Post As relief materials pile up at major rescue centres in quake-hit areas of Sichuan province, villagers from rural communities are complaining they have been forgotten by the government. “It’s been four days, four days. I haven’t seen any government official bother to ask us how we have been coping,” said 66-year-old Chen Zhongfen, from Shengli village in Taiping township, in an outlying part of Lushan county.

Watch imprint on quake official’s wrist goes viral on internet | South China Morning Post A picture showing a quake-zone official’s wrist, with what appears to be the imprint of a watch, has gone viral online and left many internet users wondering whether the timepiece was intentionally removed in light of scandals involving corrupt officials caught wearing expensive watches. Searches for the name Fan Jiyue, the party chief of Lushan county, under Yaan city in Sichuan , were blocked on the mainland’s two most popular microblogging platforms – Sina Weibo and Tencent Weibo – after eagle-eyed internet users pointed out the mark on his left wrist, leading to suspicions that it was made by a luxury watch.

Wife of China’s jailed Nobel winner: I’m not free – Yahoo! News Liu Xia, under house arrest in China’s capital since her imprisoned husband Liu Xiaobo won the Nobel Peace Prize, made a rare appearance Tuesday at a trial, yelling out a car window: “I’m not free.” Liu was allowed to leave the Beijing apartment where she has been held for two-and-a-half years to attend the trial of her brother on fraud charges that his lawyers said are trumped up to punish the family. Taken by car to the court in Beijing’s suburbs, she sat through the morning-long proceedings, and when she came out accompanied by her lawyer, she shouted from an open window at diplomats and reporters.



China’s second aircraft carrier will be “larger” – Xinhua | A senior officer with the People’s Liberation Army (PLA) Navy said on Tuesday that “China will have more than one aircraft carrier.” Song Xue, deputy chief of staff of the PLA Navy, told foreign military attaches at a ceremony to celebrate the Navy’s 64th founding anniversary in Beijing, “The next aircraft carrier we need will be larger and carry more fighters.” However, Song said some foreign media reports on China’s building new aircraft carriers in Shanghai were not accurate.

Huawei ‘not interested in the US any more’ – so does this mean it will cut back on its lobbyists and pr teams focused on the us?// “We are not interested in the US market any more,” Eric Xu, executive vice-president, said at the company’s annual analyst summit on Tuesday. The world’s second-largest supplier of network gear by revenue has shifted the focus of expansion away from the US over the past year.

Kissinger Confident There Will Be No Korean Conflict – China Real Time Report – WSJ “I’m confident that in the end, North Korea will not be permitted to start a general conflict,” Mr. Kissinger said in Beijing on Wednesday, adding that he hoped the effort to deal with North Korean provocations would become “a common Sino-American conceptual enterprise.” The former U.S. Secretary of State, who was in Beijing to attend an energy conference, is not alone in downplaying the potential for conflict even as North Korea continues to thump its chest over what it describes as a “a hostile policy and nuclear threat and blackmail” against Pyongyang on the part of the U.S.

Visits to Shrine Aggravate China-Japan Tensions – Bloomberg  …from the Chinese perspective, the Japanese visits to Yasukuni aren’t isolated offenses so much as early indicators of darker intentions. Thus, it likely came as no surprise to Chinese officials when, about the time that the 168 Japanese lawmakers showed up at Yasukuni on Tuesday morning, 80 Japanese nationalists were approaching the contested Diaoyu Islands by boat, intending to land on the uninhabited rocks. They were driven off, by eight Chinese marine surveillance vessels, much to the delight of Chinese microbloggers who’ve grown impatient awaiting a more aggressive Chinese military. One of them, a self-identified freelance military journalist, placed the event in historic terms via a Tuesday tweet to Sina Weibo: “This is of great significance, as it’s the first time China’s law enforcement forces expelled Japanese rightists from the Diaoyu Islands. It’s roughly equivalent to a bearish stock market standing in the black for the first time in fifty years.”

Post-quake rescue operations expose China’s military aircraft weaknesses | South China Morning Post The widespread use of US- and Russian-made helicopters during rescue missions in the quake zone in Sichuan’s Yaan city has again exposed weaknesses in China’s home-made rescue aircraft. Military analysts said domestic-made rescue helicopters lack the ability to carry heavy loads and are less capable at handling extreme weather conditions. Some chalk the disparity up to Beijing’s focus on the development of advanced fighter jets and other general-purpose planes. News Article: Dempsey Urges More Strategic Dialogue Between China, U.S.Dempsey responded to a reporter’s assertion that three obstacles inhibit U.S.-Chinese relations: U.S. arms sales to Taiwan, reconnaissance by U.S. ships and aircraft, and “the discriminatory laws against China.” The reporter asked what the United States can do to improve the relationship. “We talked about all three of those issues today, and another three, four or five beyond that,” the chairman said. “And maybe isn’t that the point? It’s the first time we’ve spoken about these issues.” The two nations have frequent military-to-military contact on the tactical level, Dempsey said, but could benefit by more frequent senior-leader engagement. “It’s our desire, both of us, that we maintain dialogue at the strategic level. … We are committed to building a better, deeper, more enduring relationship,” the chairman added.

Report: Chinese Testing Infrastructure with Cyber Intrusions | Defense News | Cyber espionage is on the rise, and increasingly Chinese attackers are targeting critical infrastructure, probing networks to see what they can get away with, a new report from Verizon released Tuesday found. The report, an annual document from Verizon known as the Data Breach Investigations Report, combed through more than 47,000 security incidents and found that while 2011 was the year of the hacktivist, 2012 was the year of espionage.

China incursion: India likely to send army contingent to Daulat Beg Oldi area – Indian Express India is likely to send an army contingent to Daulat Beg Oldi area in Ladakh amid the failure of the flag meeting today to end the impasse on the incursion issue with the Chinese side refusing to leave, claiming it to be a part of their territory. The meeting was held by brigadier-level officers from both the sides in Spanggur Gap in the Chusul sector and India asked the Chinese side to withdraw from DBO and revert to the status quo.

China’s Nepalese friendship road leads to the heart of India’s market | World news | Guardian Weekly Beijing investing millions in Araniko highway from Tibet to Kathmandu, as India looks on with concern

PacNet #27 – The Beting Serupai incident | Center for Strategic and International Studies Led by the guided missile destroyer, the Lanzhou, a four-ship flotilla of the People’s Liberation Army’s Navy (PLAN) set sail for the South China Sea (SCS) last month. It would not be the first nor the last time that China puts on a display of its burgeoning military might in the disputed and politically turbulent waters of the SCS. //annoying all the neighbors, interesting strategy



Sichuan Relief Efforts Provoke Hong Kong Skeptics – China Real Time Report – WSJ Hong Kong activists have launched online campaigns urging the city not to give a single penny to help the victims of the most recent Sichuan earthquake — a 7.0-magnitude that hit Lushan on Saturday, killing at least 192 — citing concerns about donations falling into the pockets of corrupt officials. A number of local lawmakers have echoed the activists’ concerns



Xiaomi 2S may spur China competition in Taiwan smartphone market  China-based vendor Xiaomi Technology and Far EasTone Telecommunications (FET) are partnering to offer the Xiaomi 2S smartphone in the Taiwan market. Other China-based vendors may follow suit, according to players in the Taiwan-based smartphone supply chain. The Xiaomi 2S is equipped with a Qualcomm Snapdragon 600 1.7GHz quad-core processor and a 4.3-inch IPS touch screen and for contract-free sale at NT$9,499 (US$318), the sources note

Social Media’s Role in Earthquake Aftermath is Revealing | Tea Leaf Nation The Ya’an earthquake is the most serious natural disaster to hit China since the onset of its social media age in 2009. Most Internet users still have vivid memories of the 2008 Wenchuan earthquake, when China Central Television (CCTV) dominated reporting. This time, within two days of the Ya’an earthquake, millions of tweets were posted on China’s active microblogs like Sina Weibo and Tencent Weibo and it is clear that things are different.

“Building Foreign Media Brands in China” – Thoughtful China – YouTube Although foreign media companies have an uneasy relationship with China’s leadership, many have found an enthusiastic welcome from local readers and viewers. This week on “Thoughtful China,” we talk with Tracy Zhang, president of, the local-language online publication of the Financial Times, about how she’s building a business in China by providing news and analysis for the country’s top businesspeople and decision-makers.

Chinese Star Shoots Movie in Israel to Boost Tourism – Bloomberg The Chinese production company is filming in Israel after receiving a 300,000 shekel ($83,000) investment from the government that the Tourism Ministry hopes will increase the number of tourists from one of the world’s fastest growing markets. “We are investing in marketing, hosting journalists and have opened an agency in China. We want to put Israel on the map there,” says Sofia Prizant Pinkas, head of the Tourism Ministry’s China desk.

China Won’t Force WeChat to Subsidize Telecoms, Says MIIT Spokesman–TechInAsia MIIT spokesman Zhang Feng told reporters at a press conference that MIIT would not get involved in the tangle between WeChat and the telecoms after all, saying that whether or not WeChat has to pay should be decided by the market.

人民日报iPad版全面升级–传媒–人民网 People’s daily iPad app upgraded

工信部:将全面启动电话“实名制”_政经频道_财新网 MIIT says all phone services will require real name registration // 4月23日,工信部新闻发言人张峰表示,待电话“实名制”规定正式出台后,将全面启动电话用户真实身份信息登记

Sina 20-F SEC Filinglooks to be same risk factor as in last year’s 20-F// We are required to, but have not, verified the identities of all of our users who post on Weibo, and our noncompliance exposes us to potentially severe penalty by the Chinese government…While the Microblog Rules are not clear regarding the type and extent of penalty that may be imposed on non-compliant microblogging service providers, we are potentially liable for our noncompliance and may be subject to penalties including the deactivation of certain features on Weibo, termination of Weibo operations or other penalties imposed by the Chinese government. Any of the above actions may have a material and adverse impact on our share price.



BBC News – University of Bath student jailed over tutor bribe bid A failing student who tried to bribe his tutor while carrying a loaded air pistol has been jailed for 12 months. Yang Li, 26, placed £5,000 in cash on the professor’s table but when he was told to leave, the gun fell from his pocket….Blake James, defending, said Li came from an “affluent family” in China, where his father is a respected government official and businessman. He said his client was used to carrying large amounts of cash and had the air pistol, used for shooting practice, was in his possession as he did not want to leave it in the car.

For Chinese Women, Marriage Depends On Right ‘Bride Price’ : NPR Wang’s former classmate, Frank Zhang, who got married 12 years ago, is the master of ceremony for their wedding. He’s amazed at how much difference one decade has made in terms of wedding customs. On his wedding day, Zhang and his new wife celebrated by inviting their friends home for a meal. He didn’t give her an apartment or a car or any money. And when she first met his parents, they gave her 888 yuan — another auspicious amount — or roughly $100 about one-hundredth of the bride price Wei paid. It’s a sobering reminder of how the gender imbalance and new wealth is changing China.

Miami Collectors Tap New China Artists for Art Basel Show – Bloomberg good pr in advance of them selling their collection?// The influential Miami-based collectors Mera and Don Rubell will focus on contemporary Chinese art in their next exhibition for the 2013 Art Basel Miami Beach in December.

CHIMERAS at Hot Docs spotlights booming China art scene | rabble.caThe film chronicles the personal and philosophical journeys of two artists: Wang Guangyi — one of the granddaddies of China’s contemporary art movement and now, one of the top 10 living artists in terms of sales — and the newbie on the scene — photography student Liu Gang, the only child of parents who also work in the canteen of his art school in Beijing. It starts off at a glitzy opening in which the elder artist intones: “Art has given me so many things… it has also disappointed me.” The first few scenes lure the viewer into personal worlds — hooks which never let go. Mattila’s access to both artists is all-inclusive. The intimate encounters the audience experiences i.e. their daily lives, relationships and revelations, are a result of what the filmmaker says was “countless hours” of chatting, which led to friendships and a bond of trust. // Chimeras Documentary Film Trailer



Chinese factories recycling plastic waste into tableware–WantChinaTimes The adulteration of new material with recycled material is a prevalent practice, and recycled waste accounts for a major part of the final product, said the owner, surnamed Tang. Further, Tang added that his factory imports plastic waste from abroad, which costs less than domestically generated waste. However, his factory does not hoard such waste material to avoid checks by the environment-protection authorities, he explained.

Closer Look: How Pig Carcasses Can Become Treasure Instead of Trash – CaixinI n recent years, certain regions have started to see dead pigs as treasure instead of trash. For instance, when Zhu Fangmin of Suining County, Jiangsu, learned in 2011 that each year about 6,000 diseased pigs died in his county, he asked himself how he could turn this grim statistic into a profit. He invested nearly 1 million yuan to set up a carcass treatment plant in his village. The dead livestock goes through a series of treatments, including high-temperature and high-pressure processing to exterminate pathogens carried by the dead animals, and is turned into industrial oil or fertilizer.The plant can dispose of 150 to 200 dead pigs every day, earning Zhu more than 100,000 yuan in profit in 2012 and enabling local farmers to get compensation of 1,000 yuan for each pig they bring to the plant.

China’s Organic Food Cooperatives Must Overcome Trust Deficit | Tea Leaf Nation Fortunately, there is a growing number of Chinese experts who can help entrepreneurs like Chen, as the idea of organic production catches on. Shi Yan, director of Beijing-based Share the Harvest and the chief operator of the Little Donkey Farm, has a Ph.D. from Renmin University in agricultural ecology. She has authored several studies on organic agriculture in China and also spent time in America studying the concept of CSA. “CSA is the starting point for a rural renaissance,” said Shi, “New agricultural methods and new farmers – young people willing to stay in villages and work there – will create a new village model.”

About us – 小毛驴市民农园 – 社区支持农业 | Little Donkey Farm – CSA Community Supported Agriculture First Community Supported Agriculture (CSA) farm in Beijing delivers produce to your door once or twice a week (depending on your preference). Memberships range from RMB 2,200-3,000 for delivery, or RMB 1,600-2,400 for pick-up orders. You can also farm your own small 30~ 60-square meter plot for RMB 1,500~ 12000 a year.  The farm also organise lessons,teaching citizens to care food and environment with effective techniques, helping them plant better in their own land.



China Faces Glut of High-end Hotels – Economic Observer Policies aimed at reining in housing prices have pushed many local governments to develop commercial property projects and it’s become standard to include a 5-star hotel managed by an internationally-recognized brand as part of these new developments.

Fears surface after hippo kills tourist from Shanghai[1]| A Shanghai tourist killed in Kenya by a hippopotamus on Monday has sparked fears among tourism insiders over Chinese visitors joining adventure tours without sufficient awareness of self-protection. The Standard, an English-language newspaper in Kenya, reported that a woman in her 30s was attacked by a female hippo as she tried to take photos of a baby hippo at Lake Naivasha Country Club, 5 km from a nature reserve in the town of Naivasha. She died on the way to hospital.



Death ends ‘great love’ for Shanghai |Books | Shanghai writer Cheng Naishan, 67, died of leukemia early on the morning of April 22. Recognized as a voice of Shanghai, Cheng had a career documenting the city’s history, legacy and anecdotes. Her latest works include a column titled The Swan Pavilion in Shanghai Literature, and a series of six essays composed in Shanghai dialect, published in Xinmin Evening News from last November to March 13.



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