The Sinocism China Newsletter For 10.22.12

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

The best way to see this daily post is to subscribe by email. You can also follow me on Twitter @niubi or Sina Weibo @billbishop

Reading Xinhua may give a good idea of the major themes of the report on the 17th Party Congress that will be delivered to the 18th Party Congress. Over the last few days Xinhua has published China focus: CPC develops democracy over last decade,  Xinhua Insight: Implementation of scientific development long-term, arduous task  and Xinhua Insight: CPC faces economic-ecological harmony challenges, all referencing Hu Jintao’s July 23rd speech (Xinhua) at the Central Party School.

In last week’s discussion of Time Magazine’s speculation (now corrected) that the Communist Party may be ready to downplay if not jettison Marx, I wrote that there have been two recent “Seeking Truth” essays by  the authoritative author “秋石” (Autumn Stone) that drew on Hu’s July 23 speech. In fact there have been four since August 16-辉煌的成就和历史性进步坚定不移走科学发展道路— 党的十六大以来我国经济社会发展的鲜明主题坚持和发展中国特色社会主义—— 毫不动摇走党和人民在长期实践中开辟的正确道路 and 奋力把改革开放推向前进. So far the full text of this important speech has not been released publicly.

Economic reform chatter continues, with Reuters reporting that China’s cabinet is seeking an ambitious economic reform agenda and canvassing advisors nationwide for ideas. Li Keqiang’s talk at a recent symposium is getting a lot of play in the Chinese media today, and Xinhua English-Chinese vice premier urges structural upgrades via taxation reforms.

Today’s links:


分配改革纲目并举 剑指垄断高收入–中国证券报 – income distribution reforms plan the state council is working on must be sparking some contentious of target may be the astounding wage/benefits differentials between SOE employees and others//

怀胎八年:收入分配改革方案 12月“分娩”|收入|分配|出台_21世纪网 – income distribution reform plan has been “coming” for 8 years..but this time it should be delivered by the end of 2012.

Analysis: Defying doomsayers, China to avoid Japan-style bubble | Reuters – Abundant room for greater consumption and wealth, a slow-rising currency, and steps to cool property markets will leave it in good stead to avoid Japan’s fate. “I know as a matter of fact that policymakers in Beijing have looked a lot at Japan,” said Louis Kuijs, a former World Bank economist now at the Royal Bank of Scotland. “Japan often comes up in discussions.”

China focus: Canton Fair foretells grim trade outlook, economic rebalancing – Xinhua | – The fair registered a total of 93,529 overseas buyers as of Thursday, a decline of 11.4 percent over the same period in the spring session.

China money outflow decreased substantially in September – The change of the position for forex purchases of the PBOC detailed monetary statistics has swung back into positive territory after decreasing for two straight months. Excluding trade surplus, the implied outflow has shrunk from RMB187 billion in August to RMB44 billion in September, a very sizeable improvement as far as capital flow is concerned.

多因素致9月份外汇占款结束“负增长”-中国金融新闻网 – WSJ series on Chinese capital flight looking a bit alarmist after the recent data on capital flows?

Japan exports drop 10.3% as trade deficit widens – MarketWatch – The weak performance for exports came as shipments to China fell by just over 14% for the month, while those to Western Europe tumbled 26%, far outweighing a 0.9% increase in U.S.-bound exports

24万亿,花哪去了?行走的中国_21世纪网 – 21st Century Business Herald take an in-depth look at consumption in China

《新世纪》周刊第523期_杂志频道_财新网 – this week’s Caixin Magazine cover story: “China Style Subprime Loans”

Chinese firms take bigger share of running Hong Kong IPOs | South China Morning Post– Part of the reason why mainland companies want to rely more on mainland investment banks to handle their IPOs is because many Western asset managers – potential investors in the deals who have good ties with Wall Street banks – are short of cash or have to allocate more financial resources to solve their problems at home rather than to put more focus on Hong Kong business. Meanwhile, capital-rich state-owned enterprises that mainland investment banks are close to have become major investors in many IPOs that have been launched this year in Hong Kong.

Signs of Revival Spur Longest Rally Since April: China Overnight – Bloomberg – “The sentiment on China has really changed,” Kelvin Tay, the Singapore-based chief investment officer for the southern Asia-Pacific region at the wealth management unit of UBS AG, said in an interview on Bloomberg Television on Oct. 19. “The numbers are pointing to the fact that the economy has actually bottomed in the third quarter. China is likely to be the best performing market in the coming months.”

China unlocks right kind of growth – – but sustainable? // In the first three quarters, consumption accounted for 55 per cent of growth, while investment contributed 50.5 per cent. With external demand weak, net exports actually subtracted 5.5 per cent, according to data from the national statistics bureau. This is exactly what everyone from Wen Jiabao, China’s premier, to the World Bank has said is necessary to make for a more sustainable economic model.

Rebalancing China: China’s consumer-led growth | The Economist – seems a bit optimistic/ overstated// CHINA, you may have heard, announced its latest growth figures on Thursday. The speed of growth attracted most of the attention, but the source of growth is perhaps more striking. At a press conference (in Chinese; see an FT report here), the National Bureau of Statistics pointed out that in the first three quarters of this year consumption* contributed over half (55%) of China’s growth, exceeding the contribution from investment. If that pattern holds, China’s growth this year will not be investment-led (let alone export-led), but consumption-led.**

Higher costs forcing firms to relocate |Economy |– The official, who declined to be named, said that “nearly one-third of Chinese manufacturers of textiles, garments, shoes and hats “are now working” under growing pressure” and have moved all, or part of their production, outside China in what he called the great industrial transfer. Favored destinations are usually members of the Association of Southeast Asian Nations, especially Vietnam, Indonesia and Malaysia.

China’s currency rises in the US backyard – – interesting if possibly a bit overstated// Would-be US leaders would do well to note that for probably the first time since the second world war the dollar bloc in east Asia has been displaced. In its wake a currency bloc based on China’s renminbi is emerging.

三季度现金流大幅改善 三一重工被误判?_股票频道_一财网 – Sany Heavy in the midst of a transformation, business and financial situation not nearly as bad as some have claimed?// 10月15日,三一重工多位高管向第一财经日报《财商》记者表示,尽管受宏观形势影响,包括三一重工在内的整个机械行业都遭遇了业绩下滑,但情况正在好转。而记者发现,三一重工正在进行一场新的战略转型,发展路径和风格已经有所改变。从三一重工提供的相关数据分析,转型的正面效果或许在今年三季度有更大的表现。



【舒立观察】司法独立、政改与十八大_杂志频道_财新网 – This week’s Hu Shuli editorial, on the need for reform, and the crucial role an independent judiciary must play. she sounds almost optimistic on the eve of the 18th Party Congress// 在中共十八大之后毫不动摇地全面推进经济、政治、文化、社会体制改革的大布局中,司法改革将具有重要的地位,而且很可能成为突破口之一

江泽民为母校扬州中学建校110周年题词(图) – 爱问 –Jiang Zemin stays in the news, this time with an inscription for the 110th anniversary of his high school alma mater, which got lots of press over the weekend

In China, a Rivalry for Economic Stewardship – NYTimes so many fun rumors going around Beijing. will be strange when things are settled in a few weeks// The leading candidate to become executive vice prime minister now appears to be Zhang Gaoli, the party secretary of Tianjin, a party insider said. He is an economist by training but has a reputation as a cautious official more preoccupied with maintaining political stability than with undertaking economic policy experiments.

十八大后高层三大要职人选底定_多维新闻网 –

Restructuring plays important role in political reform|Politics| – In a speech delivered at the opening session of a workshop for ministerial-level officials on July 23 this year, President Hu Jintao said the Party has put political system reform in an important position in the overall reform and development agenda. He said significant progress had been made in that regard.

China’s incoming first lady a challenge for the image makers – – Peng Liyuan, wife of soon-to-be President Xi Jinping, is already famous and popular. How the Communist Party handles her may be a clue to its willingness to modernize.

China Daily Special Section for the 18th Party Congress – Wonder if this will run as an insert in Washington Post and other foreign papers?

Security won’t hinder daily life, Party official says |Latest News | – Beijing residents will not be adversely affected by heightened security during the 18th National Congress of the Communist Party of China, authorities vow.

人民日报:现阶段问题只能通过改革开放解决_新闻_腾讯网 – more in today’s people’s daily on the need to push forward w reforms// 矛盾期心态(思想纵横)

Poll: Chinese public satisfied with selection of officials – People’s Daily Online – The public gave a “credibility score” of 78.3 for this year’s personnel selection, which was handled by the Organization Department of the Communist Party of China (CPC) Central Committee, according to the poll results.



Group to Try Talks on Islands in Japan-China Trip – NYTimes The group is scheduled to meet with Japan’s prime minister, Yoshihiko Noda, on Monday and to visit with the Chinese leadership on Tuesday. China has not informed the group with whom they will be meeting.  The trip was arranged after Mr. Steinberg and other members of the group discussed what might be done to tamp down the tensions over the islands, which are called Diaoyu in Chinese and Senkaku in Japanese.

China Navy Conducts East China Sea Exercises Amid Japan Row – Bloomberg – China’s navy will conduct exercises in the East China Sea to better coordinate missions to protect Chinese territory, Xinhua News Agency said, a move that may heighten tensions with Japan over disputed islands.

Japan, U.S. abandon drill to ‘retake’ isle | The Japan Times Online– The drill, however, would worsen the backlash from Beijing, which has reacted harshly to Japan’s nationalization of the Senkaku Islands, which are also claimed by China and Taiwan. A government source said the decision to skip the Irisuna recapturing drill “reflects the opinion of the prime minister’s office.” Another reason was opposition from residents on Okinawa Island, about 60 km away, where sentiment against U.S. bases has flared up following allegations that a Japanese woman was raped by U.S. sailors Tuesday.

US risks drawing Beijing’s ire with cruise in disputed waters | World news | – USS George Washington enters South China Sea as display of naval strength and support of smaller Asian nations claims

Japan’s coastguard saves Chinese crew as cargo ship Ming Yang burns | South China Morning Post– Japan’s coastguard yesterday saved all 64 Chinese seamen from a burning cargo ship, as the two nations remain locked in a dispute over contested islands. The coastguard was alerted by Taiwanese authorities late on Saturday about the fire on the 12,703-tonne Ming Yang, and sent patrol vessels and aircraft to the scene, around 150 kilometres southeast of Okinawa.

Senior CPC leader vows to deepen ties with Bangladesh – Xinhua | – Li Changchun (R), a member of the Standing Committee of the Political Bureau of the Central Committee of the Communist Party of China, meets with Bangladeshi President Zillur Rahman in Dhaka, Bangladesh

$100 Billion For China’s Railroads – Flashpoints– interesting post, hawks and defense contractors in US really do not like to discuss this topic// The top people at the Ministry of Railways wanted to get rich, while seeming to produce fast results. In the end, they were caught: Their high-speed trains did not work when really put to the test, and 40 people died as a result. China’s new military system remains largely untested. But if billions have been stolen by generals and contractors, instead of spent perfecting complex systems and operating procedures, then China’s military could in effect be a high-speed accident waiting to happen. As for those budget estimates, the Pentagon and others who assume that China spends a lot more on defense than it claims should maybe think again. Adjusted for wastage and corruption, actual PLA spending could be much lower than anyone realizes.



Hong Kong Buys $603 Million in First Peg Intervention Since 2009 – Bloomberg – “The recent increase in demand for the local currency is related to a less strained European market, weakness in the U.S. dollar and declining U.S. interest rates, which have prompted capital inflows into currency and equity markets in the region,” the HKMA said in today’s statement. “Upward pressures have similarly been observed in other Asian currencies,” it said.



交战互联网金融-财经网 – 互联网与银行业务的融合,将促使银行转变传统经营方式,减少依赖节点型的专用资本,学会运用网络化的社会资本,这正是未来银行结构转型的关键



Smartphones put family ties on hold – People’s Daily Online – Despite living in a nation where filial piety is encouraged, elderly Chinese are feeling ignored nowadays as their children and grandchildren focus on their cell phones.

Gay wedding reflects growing tolerance in China: experts – Xinhua |– A public gay wedding held in east China’s Fujian Province earlier this month reflects growing tolerance for homosexuality, according to sociologists and gay rights activists. Lu Zhong, 24, and his partner Liu Wangqiang, 20, held a high-profile wedding ceremony on Oct. 2 in Zherong County in the city of Ningde.



HK makes largest ivory seizure worth–China Daily – 600 or so dead elephants// HONG KONG – Hong Kong seized HK$26.7 million ($3.5 million) of ivory tusks and ornaments smuggled from Africa, authorities said, the region’s largest ever seizure of illicit ivory that is still widely sought despite an international ban.

京杭运河丹阳段因化工厂偷排废水变蓝_网易新闻 – Pictures. Section of the Grand Canal in Danyang turns bright blue after discharge from a chemical plant//



美国西部特写–大提顿国家公园_梁芳洁的芳草地_梁芳洁_博联社 – nice pictures from a Chinese photographer’s tour of the American West over the recent National Holiday. Will be lots more travelers like this as US visas get easier for Chinese tourists

Maggots in the Pasta: Europe Screens Tainted Chinese Food – – Cypriot inspectors found arsenic in the frozen calamari. The Italians discovered maggots in the pasta. There were glass chips in the pumpkin seeds bound for Denmark, and Spanish regulators blocked a shipment of frozen duck meat because of forged papers. It has been a rough year for Chinese food exports to Europe.



Tibet Wild: A Naturalist’s Journeys on the Roof of the World: George B. Schaller: Amazon – Tibet Wild is Schaller’s account of three decades of exploration in the most remote stretches of Tibet: the wide, sweeping rangelands of the Chang Tang and the hidden canyons and plunging ravines of the southeastern forests. As engaging as he is enlightening, Schaller illustrates the daily struggles of a field biologist trying to traverse the impenetrable Chang Tang, discover the calving grounds of the chiru or Tibetan antelope, and understand the movements of the enigmatic snow leopard.

‘Tibet Wild,’ by George B. Schaller – – In the course of half a century of observing wild animals, the field biologist George Schaller has been gradually moving higher, heading toward thinner air and lonelier places. And few places are lonelier than the Chang Tang highlands of the Tibetan plateau, the setting for the work described in “Tibet Wild,” a high desert that resembles an image beamed back to Earth from the Mars rover Curiosity. This bleak landscape seems to match Schaller’s nature. “The desolation calms,” he remarks, “it does not intimidate.”

The best way to see this daily post is to subscribe by email. You can also follow me on Twitter @niubi or Sina Weibo @billbishop