China Brokerage Firm Fined $85 Million Over ‘Fat-Finger’ Trades

HONG KONG — China’s securities regulator issued a fine of 523 million renminbi, or $85 million, on Friday against a brokerage firm whose erroneous trades caused a sudden but short-lived 6 percent increase in Shanghai’s main share index on Aug. 16.

The China Securities Regulatory Commission ruled that the abnormal trades conducted by the brokerage firm, Everbright Securities, had constituted ‘‘a number of legal and regulatory violations,’’ Xinhua, the state-run news agency, reported Friday. In addition to the fine, the regulator confiscated 87.2 million renminbi ($14.2 million) in illegal proceeds from Everbright and banned four staff members from the securities industry for life. It also ordered the brokerage firm to cease all proprietary trading activities for three months, according to a statement on the regulator’s website.

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Gov. Snyder to leave next week on trade trip to Asia

Gov. Rick Snyder plans to leave next week on another economic-development trip to Asia as part of an effort to boost Michigan tourism and investment.

The Republican governor told MLive.com for a story today that he looks forward to building on relationships garnered during his first two trips. Snyder, who announced plans for the trip to China and Japan earlier this year, also led trips to the region in 2011 and 2012.

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China’s 2 biggest oil producers barred from expanding refining due to pollution violations

BEIJING — Environmental regulators have taken the unusual step of blocking China’s two biggest oil producers from expanding their refining capacity after they failed to meet targets for reducing pollution.

The penalties for PetroChina and Sinopec are a fresh blow to China’s state-owned oil industry following this week’s announcements that four senior executives are under investigation for unspecified offenses.

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Former China security chief faces corruption probe: report

(Reuters) – China’s senior leadership has agreed to open a corruption investigation into Zhou Yongkang, one of China’s most powerful politicians of the past decade, stepping up its anti-graft campaign, the South China Morning Post reported on Friday.

The reported move against Zhou – a retired member of the Politburo’s all-powerful Standing Committee and the former domestic security tsar – follows the five-day corruption trial of ousted politician Bo Xilai, who was widely considered a key Zhou ally.

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Sinopec to Acquire $3.1 Billion Stake in Apache Egypt Assets

China Petrochemical Corp., Asia’s largest refiner, agreed to pay $3.1 billion for a 33 percent stake in Apache Corp. (APA)’s Egyptian oil and gas business, marking the state-owned company’s biggest purchase in the Middle East.

Buying the stake in the operations located in the Western Desert, away from the centers of political unrest in Egypt, will increase the company’s annual production by about 9 percent, according to Bloomberg calculations. The deal, which coincides with a potential move by PetroChina Co. (857) into Iraq, signals China’s increasing investment in the region as it secures energy investments.

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Commentary: The Philippine’s dual tactics doomed to fail

The Philippines is playing dual tactics in a territorial dispute with China in the South China Sea.

On the one hand, the Philippines earlier this year referred the dispute in the South China Sea to a United Nations tribunal for arbitration by adopting a so-called “soft-hand” strategy.

On the other hand, Manila is pursuing a “hard-line” approach by begging military help from the United States and even Japan. In response, U.S. Defense Secretary Chuck Hagel later Thursday flew to the Philippines, aiming to seal a deal to increase rotational U.S. troop deployments in the Philippines.

The dual tactics have shown Manila’s a deliberate attempt to seek by all means to occupy islands and reefs owned by other countries in the South China Sea, and such tactics are doomed to fail.

For the “soft-hand” tactics of pushing for arbitration in The Hague, the move is a sheer distortion of international law, which is a wrong approach to resolving the dispute.

The core issue of the South China Sea dispute between China and the Philippines is the illegal occupation by the Philippines of some islands and reefs of China’s Nansha islands. Therefore, there is no legal basis for the Philippines to raise such claims.

While the territorial disputes concerning those islands and reefs are still pending, the compulsory dispute settlement procedures as contained in the United Nations Convention on the Law of the Sea (UNCLOS) should not apply.

Moreover, back in 2006, the Chinese government made a declaration in pursuance of UNCLOS, excluding disputes regarding such matters as those related to maritime delimitation from the compulsory dispute settlement procedures, including arbitration. This declaration is legitimate, public and effective, which deserves due respect.

By rejecting the Philippines’ arbitration request, China is exercising its legitimate right, as an embodiment of the rule of law.

For the hard-line approach, apart from seeking more U.S. military presence, Manila is upgrading its own navy by purchasing 10 new patrol boats from Japan.

However, history has repeatedly proven that seeking outside military intervention would be not only counterproductive to resolving disputes with neighbors, but also harmful to itself in the end.

In short, by playing the dual tactics, Manila will achieve nothing.

The right approach for Manila to take is to sit down and hold bilateral talks and consultations with China to resolve the dispute peacefully.

This will be the only feasible and appropriate option for the Philippines to ensure its own interests.

By Xinhua writer Wu Liming

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U.S. secret intelligence budget surges after 9/11 terrorist attacks: report

The secret budget for the intelligence community in the United States has gone up greatly since the terrorist attacks more than a decade ago and as a result of aggressive new efforts made to hack into foreign computer networks, the Washington Post reported Thursday citing new documents revealed by former defense contractor Edward Snowden.

Citing findings in the classified documents obtained from Snowden, the newspaper said the U.S. spy agencies have built “an intelligence-gathering colossus” since the attacks of Sept. 11, 2001, but remained unable to provide critical information to the president on a range of national security threats.

The “black budget” for the fiscal year 2013, for instance, totaled 52.6 billion U.S. dollars, about twice the estimated size of the 2001 budget and 25 percent above that of 2006.

According to a 178-page budget summary for the National Intelligence Program, the U.S. intelligence community consists of 16 spy agencies with 107,035 employees.

Spending by the Central Intelligence Agency (CIA) has grown to 14.7 billion dollars in requested funding for the year of 2013, more than any other spy agency and nearly 50 percent above that of the National Security Agency (NSA), which has been under fire at home and abroad for secret spying programs revealed by Snowden since June.

In a response to inquiries from the Washington Post, U.S. Director of National Intelligence James Clapper admitted the U.S. has made “a considerable investment in the Intelligence Community” since the terrorist attacks of Sept. 11, 2001.

The documents also disclosed that both the CIA and NSA have launched new “offensive cyber operations” to hack into foreign computer networks to steal information or sabotage enemy systems. Also, the NSA has planned to investigate at least 4,000 possible insider threats in 2013, and the U.S. spy agencies have worried long before Snowden’s leaks about “anomalous behavior” by personnel with access to highly classified material.

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More carriers likely in China

It’s been less than a year since the Liaoning, the Chinese navy’s first aircraft carrier, was put into active service, but a Defense Ministry spokesman is promising that there will be more carriers in the future.

On Thursday, Colonel Yang Yujun said at a news conference that China will consider developing aircraft carriers in accordance with its national defense needs.

Yang made the comment in response to media reports that China is, for the first time, domestically developing an aircraft carrier.

The Liaoning is a retrofitted former Soviet Union carrier commissioned in the People’s Liberation Army navy on Sept 25. It can carry about 30 fixed-wing aircraft.

Takeoff and landing tests of J-15 fighters, the navy’s main strike force, from the Liaoning have thus far been successful. The carrier has also completed three training missions this year.

“How many carriers the Chinese military will build depends on its naval strategy and the country’s economy,” said Wen Bing, a senior researcher of the PLA Academy of Military Sciences. “China is still exploring how to effectively develop and use its carrier battle group, so it is too early to predict the number of carriers in the future.”

Wen said China is determined to gradually improve its naval prowess.

In the near future, China will not be able to build a carrier as advanced as those in Western navies, and the nation must have a reasonable outlook in its plans for developing carriers, Wen said.

But Cui Yiliang, editor-in-chief of Modern Ships magazine, offered a different opinion.

“Our shipbuilding sector definitely has the potential to develop and build large carriers because China’s capability in industrial manufacturing is stronger than some nations that have already built their own carriers,” Cui said.

In addition, the country has accumulated a lot of experience in refitting the Liaoning, which will significantly boost the nation’s plans for an indigenous carrier.

“One carrier can’t guarantee that we can deploy and put into use a carrier battle group any time in the future since the giant ship is a very complicated system that is prone to a wide variety of problems,” said Cui, who added that at least two or three carriers are needed.

“But the final decision is up to the top leaders.”

By Zhao Lei and Zhou Wa ( China Daily)

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‘Don’t flaunt ASEAN banner’ on the S. China Sea issue

The top Chinese diplomat said on Thursday that China opposes certain ASEAN member nations “trying to tout their own stand as that of the regional organization” on the South China Sea issue, which will certainly harm common interests between China and ASEAN.

Foreign Minister Wang Yi made the remarks at a news conference after the Special ASEAN-China Foreign Ministers’ Meeting, held in celebration of the 10th anniversary of their strategic partnership.

“The ASEAN colleagues and I agreed that they (the disputes) are not expected to define the relationship, and we should not allow them to affect our overall interests,” Wang said in reference to the disputes over some islets in the South China Sea.

Wang said though the meeting focused on regional cooperation and trust-building, “we did not shy away from problems that exist”.

“Currently the situation in the South China Sea is stable, and when we look at other places in the world, we should dearly cherish that.”

Tensions between China and the Philippines have flared up in the past months over maritime territorial disputes. Manila has repeatedly sought to include the South China Sea issue in joint declarations of the 10-member Association of Southeast Asian Nations, drawing criticism from some member countries.

Premier Li Keqiang told ASEAN foreign ministers later on Thursday that the priority of China-ASEAN cooperation should be on the economy, given the complex situation of the global economic recovery and challenges facing some emerging markets.

The premier assured the ministers that Beijing will firmly adhere to the path of peaceful development and properly handle disputes with some ASEAN countries.

Li is scheduled to attend the 10th China-ASEAN Expo and the China-ASEAN Business and Investment Summit, to be held next week in Nanning, capital of the Guangxi Zhuang autonomous region. China-ASEAN trade topped $210 billion in the first half of this year, an increase of 12.2 percent year-on-year, according to the Ministry of Commerce.

Ruan Zongze, vice-president of the China Institute of International Studies, said deep cooperation and a free trade agreement between the two sides have enabled China and ASEAN to weather the world financial crisis.

“The two sides should properly handle the disputes and put them under control,” Ruan said.

Thai Deputy Prime Minister and Foreign Minister Surapong Tovichakchaikul, who co-chaired the meeting with his Chinese counterpart Wang Yi on Thursday, said, “We will not allow any particular issue to overshadow ASEAN-China relations, which are progressing well.” Further meetings on the South China Sea issue are scheduled for September.

Surapong said ASEAN looks forward to holding “constructive and substantive” discussions with China.

Jia Duqiang, an expert on Asian studies at the Chinese Academy of Social Sciences, said some troublemakers in the region have ignored the fact that “ASEAN as a whole has never been a contending party in the South China Sea issue”. By stirring up the issue, some countries have “threatened the interests of other South Asian countries”, he said.

The 11 foreign ministers agreed on Thursday to focus on regional economic integration, and vowed to upgrade the China-ASEAN free trade area and push forward negotiations on a regional comprehensive economic partnership.

Chen Qinghong, a researcher on Philippine studies at the China Institutes of Contemporary International Relations, said that as the strategic partnership enters its 10th year, it is time for China and ASEAN to update the relationship, eliminate worries and forge a fresh start for the next decade.

By Zhang Yunbi and Li Xiaokun ( China Daily)

He Liu contributed to this story.

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China asks Philippines’ Aquino to call off visit in apparent snub

(Reuters) – China has asked Philippine President Benigno Aquino to call off a visit next week for the opening of a trade fair, Manila said on Thursday, in an apparent snub, but Beijing insisted it had never invited him in the first place.

Relations between the two countries have been soured by a bitter territorial dispute in the South China Sea.

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China Rejects Multilateral Intervention in South China Sea Disputes

BANDAR SERI BEGAWAN, Brunei—China’s defense minister issued a blunt rebuke to

Southeast Asian counterparts on Thursday, saying Beijing rejected any

multilateral approach to resolving competing territorial claims in the South

China Sea.

Jullian Barnes, The Wall Street Journal via CHINA US Focus http://feedproxy.google.com/~r/ChinaUsFocus/~3/JCi08Q4u0x8/

China Defense Ministry Promises More Aircraft Carriers: Xinhua

China will “surely” build more aircraft carriers now that it has its first, a Defense Ministry spokesman said, according to the official Xinhua News Agency.

Asked to confirm reports that China is building its first carrier from scratch, ministry spokesman Yang Yujun said today “there will surely be more in the future,” according to Xinhua. China will consider building carriers in accordance with its defense needs, he said at a briefing.

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Xiaomi Hires Google’s Barra to Boost Growth Beyond China

Xiaomi Corp., the smartphone maker that outsells Apple Inc. (AAPL) in China, said it hired a Google Inc. (GOOG) vice president as part of a push to find growth opportunities outside its home market.

Hugo Barra, who helped oversee Google’s Android product management, will join Xiaomi in October as head of international business development, Lei Jun, founder and chief executive officer of the Beijing-based company, said in a post on Sina Corp.’s Weibo microblog today. His post was confirmed by Raine Zhang, a Xiaomi spokeswoman.

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China set to overtake US in e-commerce

China is poised to surpass the United States to become the world’s largest e-commerce market this year, according to consultancy Bain & Co.

With forecast 32 percent average annual growth, online shopping expenditures in China are set to reach 3.3 trillion yuan ($539 billion) by 2015, the consultancy said in a report.

The study was based on a survey of more than 1,300 shoppers in China across a range of cities, ages, educational backgrounds and income levels.

“While beating the US is a major milestone for e-commerce in China, there is no longer a meaningful distinction between retailers’ brick-and-mortar, Web and mobile strategies,” said Serge Hoffmann, a partner in Bain’s retail practice in China and co-author of the report.

The study found that more than 70 percent of Chinese shoppers research products and compare prices online and offline, and across different e-stores, with half of them citing price as the top reason for online shopping.

The research suggested that two-thirds of buyers rely on smartphones to browse for or buy products, a proportion higher than the US.

The figure climbed to 75 percent for upper-income consumers, who have a monthly household income of more than 50,000 yuan.

“China’s rising middle class has high expectations of consumer products and also a need for product verification.

“With the rise of e-commerce and social media, online marketing channels and Internet forums offer a platform for consumers to gather the intelligence they need to make informed purchasing decisions,” said Robert Theleen, chair of the American Chamber of Commerce in Shanghai.

The potential is huge for business-to-customer sites to woo shoppers from customer-to-customer sites, said Hoffmann.

For instance, the compound annual growth rate for B2C platforms was 160 percent from 2009 to 2012, and the sector is expected to continue growing by 53 percent annually through 2015.

In comparison, Taobao.com, China’s leading C2C platform, grew by a compound annual rate of about 65 percent throughout the period.

Given a choice, 82.9 percent of shoppers would prefer an e-store with a brick-and-mortar presence over pure play sites like Jingdong Mall, which only runs digital stores.

“This indicates a significant growth opportunity for omni-channel merchants,” said Hoffmann.

He identified two reasons for shoppers’ preferences. One is the “touch and feel” of a physical shop. In general, Chinese consumers lack confidence in merchants because they are worried about being sold fake or low-quality products, especially online.

A majority of these shoppers also cited offline after-sales service and a general comfort level with physical merchants.

The survey found that websites successfully feed store sales. More than 60 percent of shoppers said that a retailer’s e-store will increase their spending at the same retailer’s brick-and-mortar stores.

Building a dedicated digital team and investing in a world-class website are critical to grab a foothold in the e-commerce territory. Hoffmann cited Uniqlo Co Ltd, the Japanese apparel brand, as an example of how to streamline entry into China’s digital retail market.

Uniqlo outsourced development of websites for both its e-stores (the official Uniqlo site) and another on Tmall.com.

Hoffmann said that outsourcing accelerated Uniqlo’s online launch by tapping into Tmall’s knowledge, reducing IT costs and allowing the company to utilize its partner’s established logistics and distribution systems.

Hoffmann suggested that 20 percent of the online products should be “special” ones, with the same price in stores that are not available to pure plays.

About 30 percent of online merchants offer the same price as stores but with different coding, which limits price comparisons.

By HE WEI ( China Daily)

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Five-year work plan to fight graft unveiled

China aims to establish a system to punish corrupt officials by the end of 2017, the Political Bureau of the Communist Party of China Central Committee said.

Supervision of how officials exercise power will be enhanced, and a punishment system, under which officials dare not take bribes, will be formed, according to a five-year work plan that the Political Bureau approved on Tuesday.

The work plan — made by the Central Commission for Discipline Inspection of the CPC, the country’s top anti-graft agency — is the commission’s second five-year plan targeting corruption.

Given that corruption remains rampant, punishment for graft will be increased, the work plan said.

Both “tigers” (senior corrupt officials) and “flies” (low-level corrupt officials) will be targeted to prevent the spread of corruption, the work plan said.

In a speech at an anti-graft conference in January, President Xi Jinping vowed strict supervision, saying that authorities must tackle graft by targeting both “flies and tigers”.

The Party’s disciplinary inspection system will be reformed, and supervision through the Party’s anti-graft agencies, judicial authorities and news media will be enhanced, according to the plan.

Anti-corruption officials should play a leading role in setting an example for other officials in clean governance.

The work plan also promises to eliminate undesirable work habits of Party and government officials, including formalism, bureaucracy, hedonism and extravagance.

Xi had said that the Party is going to initiate a yearlong campaign to “thoroughly clean up” undesirable work habits.

Zhu Lijia, a professor on government administration at the Chinese Academy of Governance, said inspection teams will become routine in the anti-corruption campaign.

Through the inspection teams, central authorities will pinpoint problems in local governments more effectively, he said.

By AN BAIJIe ( China Daily)

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Special Report: Xi’s trip to promote win-win cooperation

With President Xi Jinping scheduled to visit Central Asia and attend two major summits in the coming weeks, China is making another stride forward in promoting win-win interaction with the world.

The trip, said international relations experts, bears both regional and global significance, and will contribute greatly to realizing the “Chinese dream” of national rejuvenation and the world dream of lasting peace and common prosperity.

BOOSTING GLOBAL ECONOMY, ENHANCING ECONOMIC GOVERNANCE

Xi’s attendance at the Group of 20 (G20) summit in St. Petersburg sends a message to the international community that China attaches great importance to the significant role the group plays in solving global economic problems.

China values and supports the G20 mechanism, and follows “a progressive and coherent policy” in boosting the global economy and enhancing economic governance, said Zhang Yuyan, director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences.

As a slow recovery continues in developed countries and a slowdown bites into the emerging markets, Xi and his counterparts will discuss strategies on global coordination and economic governance in efforts to achieve a robust, sustainable and balanced economic growth.

Meanwhile, Xi will present China’s current economic situation as well as its great economic potential to the international community, giving the lie to those mongering gloom on China’s economic outlook.

With other heads of state, the Chinese president will also discuss how to improve global governance and build a fairer and more effective international economic order, including reforms of such organizations as the International Monetary Fund and the World Bank.

As the largest developing country, China will actively take part in global governance, as well as the setting and amending of international economic rules on investment, trade, finance and bulk commodity trades, said Chen Fengying, a senior director of China Institutes of Contemporary International Relations.

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China, Vietnam pledge to resolve dispute in South China Sea

Chinese Foreign Minister Wang Yi met with his Vietnamese counterpart Pham Binh Minh in Beijing on Wednesday when they pledged to resolve the dispute between the two countries in the South China Sea.

Reiterating China’s stance, Wang said the two countries should push ahead with maritime cooperation and work together to control the dispute and turn challenges into opportunities.

Pham said the Vietnamese side is ready to resolve the dispute and work with China for stability in the area.

During the meeting, Wang and Pham agreed to maintain high-level contact, advance cooperation in trade and inter-connectivity, and increase cultural and youth-to-youth exchanges to lay a more solid social foundation for friendship.

China and Vietnam share common strategic interests and immense room for cooperation, Wang said, calling for solidarity and cooperation to counter challenges and grasp opportunities for common development.

Pham said Vietnam attaches great importance to ties with China and stands ready to enhance strategic cooperation between the two countries in a sustained way.

Pham is in Beijing to attend a special China-ASEAN foreign ministers meeting on Thursday to mark the 10th anniversary of the formation of the China-ASEAN strategic partnership.

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The Implication of China’s Maritime Power Dream

On July 30th, at a study session with members of the Political Bureau of the Communist Party of China (CPC) Central Committee, President Xi Jinping championed efforts to build China into a maritime power.

Xi’s remarks aroused renewed concern about China’s policy change in addressing disputes in East China Sea and South China Sea. There is suspicion that China will rely on its military capability other than peaceful approaches such as dialogue and negotiation to deal with the tension. Accordingly, the potential of risks in related waters will rise, which is against the interests of a number of countries, including the US.

Hard and Soft Contents of China’s Maritime Policy

As a rising power, China’s current naval capability does not match the country’s developments. China’s strengthening of muscles and increasing expenses in building sea power have not exceeded the normal level, and accordingly, should not be questioned or blamed.

In the context of increasing uncertainties in East China Sea and South China Sea, to become a maritime power is obviously consistent with China’s interests and demand for dealing with the challenges. China has made it clear that it will safeguard its maritime rights and interests, which require the country to attach importance to the development of maritime capability. However, China’s posture will remain defensive and restrained.

China is not trying to utilize the muscles to gain advantages in resolving territorial disputes with the neighboring countries. China has reaffirmed on various occasions that it persists in peaceful approaches such as negotiation and dialogue.

The problem is that China’s policies have been misinterpreted and distorted. Some media deliberately exaggerate tough perspectives on China’s policies in order to define China as a destabilizing factor in the sea. Unfortunately, the soft contents, which are the core of China’s policies, have been neglected.

When President Xi advocated the idea of becoming “a maritime power”, he also emphasized that China would pursue “converging interests” with other countries in oceanic development. He said that China would make overall plans and take all factors into consideration, which means that China is acting in a responsible way to become a maritime power.

China’s intention has also been clearly demonstrated in Hu Jintao’s report delivered during the opening ceremony of the 18^th CPC National Congress. The report outlined China’s maritime policy as China should enhance capacity for exploiting marine resources, develop the marine economy, protect the marine ecological environment, resolutely safeguard its maritime rights and interests, and build itself into a maritime power.

Two points can be concluded from the report. The first is that China’s maritime power dream is a comprehensive design instead of pure military ambition. It not only addresses the protection of sovereignty but also stresses achieving joint development and win-win situation with other countries. The concept of a maritime power is not equal to a power with overwhelming military capability in waters that can defeat other parties according to its will. That is the consideration for which the report included the contents in the eighth part entitled “making great efforts to promote ecological progress” instead of the ninth part addressing accelerating the modernization of national defense and the armed forces.

The second message from the report is that China attaches more importance to development and cooperation rather than confrontation and conflict. China understands that the neighboring countries worry about the disputes in the South China Sea and expect to promote cooperation among related parties in order to ease the tension and maintain regional stability. China has made positive gestures. On August 2^nd, Chinese Foreign Minister Wang Yi proposed three suggestions for dealing with the South China Sea disputes during his visit to Thailand.

China Is Cooperative, Not Competitive as a Maritime Power

The US should have the confidence that China cannot catch up with the US maritime power for decades. According to a recent analysis by Russian experts, it will take 20 years for China to become a sea power. At the same time, China is sober-minded. China has no intention to challenge the US presence in waters. Based on this, the US should not overreact to China’s maritime development and treat China as a rival.

Even though both countries have not built up mutual trust that is strong enough to accommodate in-depth military exchanges, they can still work jointly on a number of perspectives that benefit regional countries and are not involved with sensitive issues.

Currently, China and the US have made some progress in collaborative efforts on land in the areas such as disaster relief, response and warning. In 2012, they jointly funded and participated in an urban search and rescue training exercise aimed at improving this capacity of ASEAN member states. USAID and the China Earthquake Administration also co-funded regional earthquake response exercise in Indonesia.

The cooperation in the sea is still lagging behind. Part of the reason is that China’s capability in waters is not sufficient to support related operations. With development, China will be able to become a qualified partner for maritime cooperation with the US.

China and the US initiated cooperation in anti-piracy operation in the Asia-Pacific several years ago. Unfortunately, the efforts were not sustained and little progress has been achieved. Now, with China’s efforts to become a maritime power, it may be the right time for both sides to resume and renew the cooperation intention and proposal.

Su Xiaohui is Deputy Director of the Department of International and Strategic Studies at the China Institute of International Studies.

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China says economy steadying after long slowdown

BEIJING (AP) — China’s government tried Monday to reassure companies and its public about the economy’s health, saying growth is stabilizing after a lengthy decline and should hit the official target of 7.5% for the year.

The announcement by the chief spokesman for the Cabinet’s statistics agency was part of official efforts to defuse unease about the country’s deepest slump since the 2008 global crisis.

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China accuses Briton, American of illegally buying private data

(Reuters) – China has accused two risk consultants, a British man and his American wife, of illegally buying and selling private information, state media reported on Tuesday, in what could be a widening crackdown on obtaining data for commercial purposes.

Peter Humphrey and Yu Yingzeng were detained in Shanghai on July 10. They have since been formally arrested, which typically means police believe they have enough evidence for a case to be brought to trial.

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China Urban Migrants’ Cost Seen at Least $6.8 Trillion: Economy

China must spend at least 41.6 trillion yuan ($6.8 trillion) over two decades to integrate rural workers living in cities and towns so the country realizes benefits of urbanization, a United Nations report said.

Spending may exceed 75 trillion yuan in a scenario with a higher rate of investment to improve living conditions and housing quality, according to the report released yesterday in Beijing. The study’s baseline assumptions are for the urban population to rise to 976 million in 2030 from 666 million in 2010 and integrate about 210 million migrant workers.

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China to launch unmanned lunar lander carrying moon rover by year-end

BEIJING — China said Wednesday it will launch its first unmanned lunar lander by the end of this year, complete with a radio-controlled rover to transmit images and dig into the moon’s surface to test samples.

The Chang’e 3 lander has officially moved from the design to the launch stage, the State Administration of Science, Technology and Industry for National Defense said in a statement.

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CPC’s November meeting to discuss deepening of reform

The Communist Party of China (CPC) will convene a key meeting in November to discuss deepening reform in an all-round way, the Political Bureau of the CPC Central Committee announced on Tuesday.

The 25-member political bureau said in a statement following a meeting on Tuesday that the Third Plenary Session of the 18th CPC Central Committee will be held in November in Beijing.

During the session the Political Bureau will report its work to the CPC Central Committee and the session will discuss major issues concerning comprehensive and deepened reforms, said the statement.

Deepening reform in an all-round way concerns the overall work of the Party and the government, and is the requirement for building a moderately prosperous society, speeding up socialist modernization drive, developing socialism with Chinese characteristics, addressing prominent challenges in the development, and achieving sustainable, healthy development of the economy and society, said the statement.

“Reform and opening up serve as a critical strategy to determine modern China’s destiny and rejuvenation of the Chinese nation. There should never be an end to the practice and development, emancipation of the mind, and reform and opening up,” said the statement.

“There is no way out for China to stop or even reverse the process,” it said, adding that reform and opening up have “only a progressive tense, no perfect tense.”

The meeting stressed that the Party must strengthen confidence in reform, head in the right direction, consolidate consensus, and coordinate all reforms.

The people’s initiative must be respected, the statement said, calling for a pooling of wisdom in the Party and society and uniting all strengths in promoting reform.

The meeting urged the Party to fully recognize contradictions and difficulties that the reform is now facing, calling for strengthened courage in tackling grave issues.

The meeting encouraged the Party to be brave enough to break down ideological barriers and vested interests. It also called for innovation in theories, systems, science and technology, culture and other fields by promoting comprehensive and deepened reform.

The statement said the idea of reform and innovation should be implemented in all aspects of governance, and the strength of the whole of society should be better consolidated in the Party’s work.

Tuesday’s meeting, which was presided over by General Secretary of the CPC Central Committee Xi Jinping, also approved a 2013-2017 work plan for establishing and improving the system for punishing and preventing corruption.

The meeting approved a document concerning functional transformation and institutional reform of local governments.

The Political Bureau members also listened to a report on preparation work done for a pilot free trade zone in Shanghai, the statement said.

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Xinhua Insight: Details of Bo Xilai’s trial

The trial of Bo Xilai, charged with bribery, embezzlement and abuse of power, concluded Monday at Jinan Intermediate People’s Court, after hearings from Aug. 22 to Aug. 26.

The verdict will be announced at a date yet to be decided.

At the trial, prosecutors demanded a heavy sentence for Bo while the defendant denied the charges.

In his final statement, Bo said he made serious errors of judgement when handling the defection of Wang Lijun, former vice mayor and police chief of Chongqing.

“Wang’s defection caused vile impacts at home and abroad and undermined the image of the Party and country,” he said. “I am deeply ashamed and filled with regret, but I did not intend to misuse my power.”

He also denied the bribery and embezzlement charges against him. “The charges are not true. My mistake, which was serious, was that I did not discipline my family and subordinates.”

“I know I am not a perfect person. I had a strong ego and bad temper. I made serious mistakes,” he said. “I sincerely admit that my failure to manage my family had a negative effect on the country.”

“I sincerely accept the investigation from the party and the judicial departments,” he said.

Over the past 16 months, the staffers who took charge of his case took care of his life, he said.

“They talked with me in a civilized way and most of them were professional, though of course, I have been under pressure during the process,” he said.

“During the trial, both prosecution and defense sides had opportunities to fully express their opinions. Also, the court released trial transcripts through microblog. All of these have made me more confident of the future of China’s judicial system,” he said.

Bo’s trial began on the morning of Aug. 22 in the largest courtroom of Jinan Intermediate People’s Court.

More than 100 people, including Bo’s family and relatives, deputies to people’s congresses, political advisors, ordinary citizens and journalists observed the trial.

The moment after Bo, escorted by marshals, walked into the defendant’s seat, he stopped and turned around, casting a glance at the observers’ seats.

Bo, 64, is former secretary of the Chongqing Municipal Committee of the Communist Party of China (CPC) and a former member of the CPC Central Committee Political Bureau.

Bo’s resume also includes the mayor and party chief of Dalian in northeast China’s Liaoning Province, member of the Standing Committee of the CPC Liaoning Provincial Committee and deputy secretary, governor of Liaoning and minister of commerce.

On April 10, 2012, Bo was suspended from the CPC Central Committee Political Bureau and the CPC Central Committee, on suspicion of serious discipline violations and the Central Commission for Discipline Inspection of the CPC filed a case for investigation.

On Sept. 28 last year, the CPC Central Committee expelled Bo from the CPC, removed him from public office and transferred his case to the judiciary.

On the same day, the Standing Committee of Chongqing Municipal People’s Congress removed him from his post as deputy to the National People’s Congress. The Supreme People’s Procuratorate (SPP) opened an investigation and decided to arrest him.

The SPP passed the case to Jinan People’s Procuratorate to prepare for prosecution on charges of bribery, embezzlement and abuse of power on April 10, 2013.

Jinan People’s Procuratorate instituted a public prosecution against Bo on July 25 on the three charges.

The court investigation began when the presiding judge informed all parties of their litigation rights at 9:10 a.m. on Aug.22.

Yang Zengsheng, vice president of Jinan People’s Procuratorate, and three others served as prosecutors in court. Yang read the indictment.

According to the indictment, Bo accepted bribes worth about 21.8 million yuan (about 3.5 million U.S. dollars) directly or jointly with others.

“The amount was especially huge,” the indictment said.

Bo was accused of conspiring to embezzle five million yuan of public funds.”The sum was huge,” the indictment said.

Bo abused his power, causing major losses to the interests of the state and people. The circumstances are especially serious, according to the indictment.

According to the prosecution, Bo’s conduct violated Clause 1 of Article 385, Article 386, Clause 1 of Article 382, the first entry of Clause 1 and Clause 2 of Article 383, and Clause 1 of Article 397 of the Criminal Law of the People’s Republic of China and he should be held criminally responsible for the three charges and be punished accordingly.

The prosecutors pointed out that the charges were filed on the basis of a large body of factual evidence.

During the trial, the defendant gave a statement on the facts regarding his alleged offenses and denied all charges.

Prosecutors and defense lawyers questioned the accused.

Witnesses Xu Ming, chairman of Dalian Shide Group Co. Ltd., Wang Zhenggang, then director of the Dalian municipal bureau of urban and rural planning and land, and Wang Lijun, former vice mayor of Chongqing, appeared to testify in court.

Both the prosecution and defense cross examined the witnesses.

Prosecutors played video recordings of Bo’s wife Bogu Kailai and Tang Xiaolin, general manager of Dalian International Development Co. Ltd., and presented evidence including documents and audio-video materials, witness’ testimony, and the confession and arguments of the defendant.

Prosecutors said the defendant failed to provide evidence that could help refute the facts regarding his charges and expressed numerous conflicting statements during his defense.

The court approved all applications by Bo and his lawyers to speak, guaranteeing them enough time to express their views.

During the trial, Bo expressed his gratitude to the presiding judge for being fair, saying the trial had proceeded in a humane and civilized manner.

When the investigation phase was complete, and with the consent of the presiding judge, the prosecution and defense debated the facts, evidence and charges.

Both sides expressed views on facts, evidence and law on which judgment of guilt and measurement of punishment would rely.

Jinan People’s Procuratorate pointed out in its summary of the case that during the trial, Bo not only denied the evidence, but overturned his handwritten confession.

On the charge of abuse of power, Bo admitted mistakes and responsibility, but did not admit the charge and refused to plead guilty.

Prosecutors stressed that the facts of the crimes are objective and will not be altered by the defendant’s own will. The fact are based on evidence, not the defendant’s testimony.

Although the country’s legal system has a principle of tempering justice with mercy, a heavy sentence in line with the law should be handed to Bo, as he committed very serious crimes and refused to plead guilty. Considering that the accused did not turn himself in or disclose another person’s crimes, he is not subject to any terms of leniency by law,” prosecutors said.

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Sino-Japanese meeting at G20 ruled out

Tokyo refuses to hold ‘dialogue of substance’ in resolving disputes.

A senior Chinese diplomat on Tuesday criticized Japan for lack of sincerity in its latest call for a meeting between the countries’ top leaders, saying Tokyo was just trying to strike a pose and mislead the public.

“A leaders’ meeting is not just about shaking hands or taking pictures, but solving problems,” Vice-Foreign Minister Li Baodong said at a news briefing in Beijing.

He was answering a question whether leaders of the two countries will hold talks on the sidelines of the upcoming G20 summit in St Petersburg from Sept 5 to 6.

President Xi Jinping and Japanese Prime Minister Shinzo Abe will attend the meeting, and some Japanese media have reported that Abe was seeking to hold talks with Xi during the event.

Li noted that Tokyo has long refused to engage in a “dialogue of any substance” with Beijing on resolving the Diaoyu Islands issue.

“Tokyo has always shown its tough side and remained provocative on this issue,” Li said.

If Japan really wants to improve relations, it should take a step of substance, rather than use “empty words or gestures”, he said.

Lu Yaodong, director of the Japanese diplomacy department of the Institute of Japanese Studies at the Chinese Academy of Social Sciences, said it was not the first time Tokyo has proposed a top leaders’ meeting.

Tokyo is trying to give people an impression that it is dedicated to breaking its diplomatic deadlock with Beijing. “By doing so, Japan can then accuse China of being insincere in resolving the disputes,” Lu said.

On Sept 9, 2012, former Japanese prime minister Yoshiko Noda talked to former president Hu Jintao on the sidelines of the APEC summit in Vladivostok, Russia.

But one day after their meeting, Tokyo ignored Beijing’s repeated warnings, and went ahead with an announcement that Japan would “nationalize” China’s Diaoyu Islands, straining already tense relations.

A top Japanese spokesman, Chief Cabinet Secretary Yoshihide Suga, has said there is no territorial dispute over the Diaoyu Islands.

On Tuesday, Japan’s Coast Guard said it will purchase more ships and recruit more personnel next year to deal with China’s “growing presence” in waters off the Diaoyu Islands.

And recently, some political forces in Japan have even openly denied the outcomes of World War II and blatantly challenged the postwar international order. “Under such circumstances, how can we arrange a meeting between the two leaders?” Li said.

Liu Jiangyong, an expert on Japanese studies and deputy dean of the Institute of Modern International Relations at Tsinghua University, said Japan has listed China as “a major target of its strategic deterrence”.

“Japan is trying to justify its increasingly assertive military buildup” by playing up tensions over the islands, which has long worried its Asian neighbors, Liu said.

UN Secretary-General Ban Ki-moon said on Monday during a visit to Seoul that Japan needs proper awareness about history.

He urged Japanese leaders to have “very deep introspection”, with particular reference to Japan’s plans to revise its pacifist Constitution.

Suga on Tuesday expressed displeasure over the remarks and inferred that the UN chief did not fully understand Japan’s position.

President Xi will pay official visits to Turkmenistan, Kazakhstan, Uzbekistan and Kyrgyzstan from Sept 3 to 13.

He is also scheduled to attend the 13th Meeting of the Council of Heads of the Member States of the Shanghai Cooperation Organization on Sept 13 in Bishkek, the capital of Kyrgyzstan.

A series of agreements will be signed in sectors such as oil and gas, transportation, telecommunications, investment and culture during Xi’s first trip to Central Asia as president, said Vice-Foreign Minister Cheng Guoping.

Dong Manyuan, vice-president of the China Institute of International Studies, said the trip will serve as an “integral piece of the new Chinese leadership’s diplomacy jigsaw” in cementing relationships with China’s neighbors.

Xi will make a speech to outline China’s Central Asia policy at Nazarbayev University, a leading university in Astana, the capital of Kazakhstan.

The central Asia trip is the third round of overseas visits for Xi after he took office in March. Xi traveled to Russia and Africa in his first tour, and to Latin America and the US in the second round.

Developing countries account for a majority of Chinese leaders’ destinations, which highlights China’s diplomatic priorities, Dong said.

By Zhang Yunbi ( China Daily)

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Bo Xilai’s Poisonous Legacy

A rising political star. A murderous wife. An attempted cover-up. A runaway police chief. A playboy son. A secret French villa. A corrupt official. A political downfall.

This conflagration of events surrounding the former high-ranking Chinese official Bo Xilai has captured the imagination of China watchers around the world. After 18 months of speculation, preparation and anticipation, Bo’s trial on charges of corruption and abuse of power began Thursday in Jinan, China.

The trial, with its predetermined outcome, will not be the climax of Bo’s story as much as the beginning of its long denouement as the Communist Party seeks to sweep this scandal under the carpet and turn its attention to the country’s economic problems.

But for China’s leadership, the stains of Bo Xilai will not fade from those carpets so easily. As Bo is hauled off to serve years in prison, the most likely outcome of the trial, the leadership will be left to address the social divisions exposed by his demise.

Bo represents a generation of Chinese leaders who were raised in an era of Communist upheaval and came to power amid capitalist excess. He entered politics with a lust for power in a country without a soul.

The details of Bo’s early history are murky. He embraced Mao’s revolutionary cause as a radical Red Guard but spent a spell as a teenager imprisoned. He is said to have broken the ribs of his own father, the veteran Communist leader Bo Yibo, in a violent confrontation. Yet, like many of the so-called princelings, children of senior party officials, he relied on his father’s lobbying to start his political career.

In his role as the Chongqing Province party secretary, Bo led the charge to revive Maoism. He abused his underlings while expecting their adulation in return. He cracked down on organized crime but ran Chongqing like a mafia boss. He fought corruption while engaging in it himself. He preached traditional Communist morality while his son flaunted his wealth at elite schools abroad. He opposed Western-style democracy but campaigned as if he were up for democratic election.

Those contradictions will be manifest in this week’s trial, wherein the new leadership under President Xi Jinping aims to showcase the application of due process but will wield its power absent an independent judiciary. China’s leaders have worked to develop a Goldilocks strategy: presenting evidence that is not too weak and not too strong. They realize that strong evidence would embolden critics of Communist Party corruption, whereas weak evidence would leave many viewing Bo as the unlucky scapegoat of intraparty machinations. For the leadership, the trial is a no-win situation.

After the trial, the political stains of the scandal will remain, forcing the party to confront the major divisions in society whose fault lines have been exposed by the case.

After coalescing for a fairly seamless political transition in 2012, the Chinese leadership has been divided over how to handle Bo’s trial. The princelings, who are led by Xi and dominate the Politburo Standing Committee, may differ greatly from Bo in terms of personality, but they empathize with him through their shared political background and sense of “red nobility” entitlement to run the country.

Leaders of a different political background, especially those with close ties to former Prime Minister Wen Jiabao, may want to see a more severe punishment for Bo. Additionally, Bo knows many secrets about his former Politburo colleagues, many of whom will want to ensure that he stays quiet for a long time to come. However these maneuverings are resolved, residual alignments from the trial may spur new ideological alliances among the leadership as it shifts to debating the political and economic direction of the country.

This debate over political and economic policies is being led by China’s public intellectuals. Members of the New Left, for whom Bo was once the most visible patron, champion Maoism and advocate a greater state role in economic planning to reduce China’s income gap. On the other side, liberal intellectuals are pushing for more rapid economic and sociopolitical reform. These starkly disparate views will clash, especially when the party embarks on potentially sweeping economic reforms at October’s Third Plenum of the Central Committee.

Finally, the Chinese people, and particularly the growing middle class, are increasingly disillusioned over the country’s political direction. Although they support anti-corruption efforts, they are aware that Bo’s corruption was far less severe than that of other Chinese officials. Even if this week’s trial is portrayed as a victory for Xi’s anti-corruption campaign, it will primarily reinforce how commonplace graft has become. Less swayed by corruption accusations, another significant group of people, most noticeably in Chongqing, sympathizes with Bo and continues to regard him as an inspirational and effective leader who got things done.

These stark divisions are not going away anytime soon. Unless the party leadership can implement meaningful reforms to establish a more accountable and representative government, the stains of Bo Xilai’s legacy may be deeper than we can now imagine.

Cheng Li is the director of research at the John L. Thornton China Center at The Brookings Institution, where Ryan McElveen is a researcher.

© 2013 The International Herald Tribune

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Using the Kosovo Precedent in Syria: Damaging US Relations With China and Russia

The apparent use of chemical weapons in Syria’s civil war has produced shrill calls for launching air strikes on the regime of Bashar al Assad. Even the inconvenient detail that the source of the chemical attack is not clear has not deterred advocates of a U.S-led military response. Some proponents have latched onto the 1999 NATO war in Kosovo as an ideal precedent. Kosovo is a precedent all right—an object lesson for why going to war in Syria would be morally dubious and strategically unwise.

Ted Galen Carpenter

Adopting that approach especially has the potential to cause serious tensions in Washington’s already delicate ties with China and Russia. Policy regarding Kosovo has been a festering sore on U.S. relations with those countries since the original crisis in the late 1990s. The supposedly inadvertent U.S. bombing of China’s embassy in Belgrade in 1999 was only the most spectacular example of the diplomatic carnage.

Indeed, for Chinese and Russian leaders, Kosovo has become a symbol of Washington’s contempt for international law and disdain for the prerogatives of other major powers in the international system. No rational person should wish to replicate that outcome by pursuing the same high-handed strategy in response to the Syria conflict.

President Bill Clinton and his supporters insisted that adequate international support was sufficient authorization for U.S. action against Serbia over the Kosovo issue, even absent congressional approval. International support typically meant a UN Security Council resolution—an argument that George H.W. Bush made before belatedly deciding, under domestic public pressure, to seek congressional authorization for the Persian Gulf War.

The Kosovo conflict, though, posed a problem for pro-war internationalists in the U.S. foreign policy community. Both Russia and China vehemently opposed intervention against Serbia, and there was, therefore, no chance of passing a Security Council Resolution authorizing the use of force. Clinton administration officials overcame that impediment by simply bypassing the Council just as they bypassed Congress. “Sufficient international support” now meant support from the U.S.-dominated NATO alliance.

Washington’s subsequent actions under the administration of George W. Bush further antagonized Beijing and Moscow and undermined international security cooperation. Bush took the Kosovo precedent one step further with the invasion of Iraq. Once again, Russia and China believed that military action was unwarranted and threatened to use their Security Council vetoes. This time, even NATO was divided, so U.S. leaders could not use the alliance’s imprimatur as supposed sufficient justification for an armed intervention. Washington overcame that problem by arguing that endorsement by an ad hoc “coalition of the willing” (or as cynical wags described it, the coalition of the bribed and bullied) constituted adequate international support. Seething leaders in Russia and China disagreed.

The Bush administration was not done showing its contempt for the views and rights of its fellow permanent members on the Security Council. Although the Council had reluctantly authorized the NATO-led postwar occupation of Kosovo under nominal UN auspices, Beijing and Moscow assumed that the province would not be granted independence from Serbia without another Council vote. But the United States, Britain, and France adopted a markedly different course. They recognized Kosovo’s unilateral declaration of independence in February 2008—once again over the strenuous objections of China and Russia.

Events soon showed that those countries could respond to such policy snubs in ways that frustrated U.S. officials. The Russian government cited the Kosovo precedent for its own moves against the Republic of Georgia in 2008, helping to detach that country’s two restless regions, Abkhazia and South Ossetia, despite Washington’s angry denunciations and the lack of UN Security Council approval. China issued pointed warnings that U.S. leaders should not even think about using the Kosovo strategy toward such sensitive secessionist issues as Taiwan, Tibet and Xinjiang.

Barack Obama has demonstrated that he is no more respectful than his two predecessors toward the views and interests of Russia and China. Washington persuaded Beijing and Moscow not to veto a Security Council resolution authorizing force against the Libyan regime of Muammar Gaddafi by assuring those governments that air and missile strikes would be limited in nature and motivated solely to prevent atrocities against innocent civilians. That proved to be untrue. It quickly became apparent that the real goal of the United States and its NATO allies was regime change. Chinese and Russian officials felt, with considerable justification, that they had been conned. Now, Obama is offering similar assurances that attacks on Assad’s forces would be only to punish the regime for the chemical attacks, not help the rebels oust Assad. Unsurprisingly, those assurances are being viewed with a good deal of skepticism.

Adding a Syria intervention to the Kosovo, Iraq, and Libya episodes will convince Beijing and Moscow, if any doubt lingers, that the United States shows no respect for their Security Council roles and will use the Council when, and only when, it is convenient for Washington’s policy objectives. Given the number of economic and security issues requiring cooperation with Russia and China, the Obama administration’s flirtation with that course is myopic and counterproductive. The damage to Washington’s crucial relations with Beijing and Moscow will likely exceed any conceivable policy “victory” with regard to Syria.

Ted Galen Carpenter, a senior fellow at the Cato Institute, is the author of nine books and more than 500 articles and policy studies on international affairs.

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China says timing not right for meeting with Japan at G-20 amid tensions over island dispute

BEIJING — China on Tuesday ruled out a meeting between the Chinese and Japanese leaders at next month’s Group of 20 summit in Russia, citing a festering territorial dispute and provocations by Tokyo.

Japan’s failure to “broaden its mindset, face historical facts and take concrete actions to remove obstacles” make a meeting between President Xi Jinping and Prime Minister Shinzo Abe impossible, Vice Foreign Minister Li Baodong was quoted as saying by the official Xinhua News Agency.

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China’s Communists Set Reform Meeting for November

China’s ruling communists will meet in November to discuss deepening reforms, the party said Tuesday. No details were given, but the meeting is likely to focus on economic fine tuning.

The announcement followed a meeting of the party’s 25-member Politburo that adopted plans for streamlining local government, and preventing and punishing corruption over the four years until 2017.

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EU Finds Chinese Solar-Panel Makers Got Aid, Raising Duty Threat

Chinese solar-panel makers received subsidies, a European Union investigation showed, increasing the likelihood of EU tariffs on imports of the renewable-energy technology from China to counter trade-distorting government aid.

The European Commission has concluded in a probe opened last November that Chinese manufacturers of crystalline silicon photovoltaic modules or panels, and cells and wafers used in them, benefited from preferential lending, tax programs and other aid, an EU official said today in Brussels. The inquiry is one of two that the commission is conducting into alleged unfair Chinese trade in solar goods — the biggest EU commercial fight of its kind.

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China economy showing clear signs of stabilization: statistics bureau

(Reuters) – China’s economy is showing clear signs of stabilization, helped by policy support and some improvement in global demand, and is on track to meet the government’s 2013 growth target of 7.5 percent, the state statistics bureau said on Monday.

The issue of local government debt also remained under control, the National Bureau of Statistics said at a briefing organized by the foreign ministry that may have been aimed at allaying global concern about China’s slowdown.

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China Investigates 3 More Oil Company Officials

Chinese authorities broadened a corruption investigation at the country’s biggest oil company on Tuesday, adding three more top officials to the probe.

The officials at the Petrochina subsidiary of China National Petroleum Corp. are being investigated for “serious discipline violations,” the Cabinet’s State-owned Assets Supervision and Administration Commission said in a brief statement.

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China, US Vie for World Approval

The US-China rivalry is today’s defining geostrategic competition. Washington is currently the biggest kid on the block, and Beijing is the strapping new boy who just moved into the neighborhood. A rivalry was almost inevitable. And there’s growing evidence that the other kids on the street expect that one day there will be a new king of the hill.

Publics around the world see the global balance of power shifting, according to the latest Pew Research Center survey. Most recognize China’s rising economic power. Many think Beijing will eventually supplant Washington as the world’s dominant superpower.

However, public appreciation of China’s centrality on the world stage has not translated into great affection. China’s favorability is dropping in many nations. Globally, people are more likely to consider the US a partner to their country than see China in this way. America is also seen as somewhat more willing than China to consider other countries’ interests when making US foreign policy. And US respect for individual liberty is a defining, positive element of America’s image, while Beijing’s abuse of human rights hurts China’s brand.

The survey was conducted in March.

As its influence grows, China is learning that being a superpower also alienates people. Beijing’s growing military strength is viewed with trepidation in the Asian region.

Since the 2008 financial crisis, perceptions about the economic balance of power in the world have been shifting. The median percentage naming the US as the world’s leading economic power has declined from 47 to 41 percent, comparing results in the 20 nations surveyed by the Pew Research Center in 2008 and 2013. At the same time, the median percentage placing China in the top spot has risen from 20 to 34 percent, although the US economy is still larger than that of China and per capita income is higher.

This trend has been especially apparent among some of America’s closest allies in Western Europe: 53 percent in Britain say China is already the leading economy, while 33 percent name the US; 59 percent of Germans also say China occupies the top position, while 19 percent think the US is the global economic leader and14 percent say it’s the EU.

In contrast, the US is still generally seen as the world’s leading economy in Latin America, Africa and in much of China’s Asian backyard: 67 percent in Japan and the Philippines, and 61 percent in South Korea, name the US as the economic powerhouse, while small minorities name China.

However, even in many countries where America is still seen as the top dog, most believe China will someday supplant Uncle Sam. In 23 of 39 nations, majorities or pluralities say China either already has replaced or eventually will replace the US as the world’s superpower. This view is more common now than it was in 2008, when Pew Research first asked this question.

In the eyes of many, America’s time on top is fading. Today, majorities or pluralities in only six countries state that China will never replace the US. But in Europe the prevailing view is that China will ultimately eclipse the US. The same expectation is held by the majority or plurality in five of seven Latin American nations polled.

Two-thirds of the Chinese state that their country either already has or someday will replace the US. Meanwhile, Americans are losing faith in their own supremacy: 47 percent say China has or will replace the US, and the same number say this will never happen. American opinion has shifted significantly since 2008, when 36 percent said China would become the top global power and 54 percent said it would never replace the US.

Not clear from the survey data is whether people are pleased or displeased with China’s emergence as a leading power. A median of 50 percent currently have a favorable view of China in the 38 nations surveyed outside China.

Overall, the US enjoys a stronger global image than China. Across the nations surveyed, a median of 63 percent express a favorable opinion of the US, compared with 50 percent for China. Young people around the world are much more likely than their elders to hold positive views of both countries.

In 28 of 38 nations surveyed, half or more of those questioned express a favorable opinion of the US. Europeans generally give the US high ratings, especially in Italy, where 76 percent have a positive view, up from 53 percent in 2007. In both France and Germany, ratings for the US have declined somewhat since 2009, the first year of Barack Obama’s presidency. In comparison, Chinese attitudes toward the United States have declined over the past three years: 40 percent expressed a favorable opinion of the US compared with 58 percent in 2010.

The US is seen more favorably than China in every region of the world except the Middle East. Moreover, favorability toward China has fallen in 10 of 19 countries since 2011, including by 14 percentage points in the United States, 11 points in Britain and 9 in France. This is likely the result of unease about China as a commercial competitor, European frustration with Chinese unilateralism in foreign affairs, and American concern about the US trade deficit with China and Beijing’s holding of American debt. Over that same period, favorability of China is also down 15 points in the Palestinian territories, 12 points in Egypt and 11 in Israel, where frustration with Chinese unilateralism in international affairs may have a particularly corrosive effect.

The strongest anti-China sentiment is found in Japan, where 93 percent see the People’s Republic in a negative light. Large majorities in Italy (62 percent) and Israel (60 percent) also hold negative views of China. The rise in anti-China sentiment in Germany is striking, now 64 percent compared with 33 percent in 2006. And such unfavorable views exist despite Germany’s success exporting to China.

Perception of how Beijing and Washington treat the personal freedoms of their own people appears to be a strong driver of global attitudes toward the two countries.

A median of 70 percent of the publics surveyed say that the United States respects the personal freedoms of its people. Just 36 percent think the government of China safeguards the rights of its people. The correlation between national favorability and respect for freedom is strong in Europe and helps explain Beijing’s declining reputation there. The contribution America’s human rights reputation makes to its global image only underscores how much the US may lose from recent revelations of US surveillance of phone and email traffic.

China’s image problem is compounded by its rising military might and territorial disputes with its neighbors in northeast Asia: 96 percent of Japanese and 91 percent of South Koreans state that Beijing’s military power is a bad thing.

In the years ahead, global publics see a change coming in the world balance of power: China is on the upswing and the United States is waning. Yet various measures suggest that people still look more favorably on the United States, are more likely to see it as a partner, prefer its soft power and applaud safeguarding of human rights. All of which suggests that what publics see as inevitable may not necessarily be seen as preferable.

Bruce Stokes is director of global economic attitudes at the Pew Research Center. The Whitney and Betty MacMillan Center for International and Area Studies at Yale.

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As Bo trial ends in China, prosecutor demands severe punishment

(Reuters) – Chinese prosecutors demanded a heavy sentence for ousted top politician Bo Xilai as his divisive, dramatic trial ended on Monday, saying his “whimsical” challenge to charges of bribery, graft and abuse of power flew in the face of the evidence.

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China’s Internet hit by biggest cyberattack in its history

Internet users in China were met with sluggish response times early Sunday as the country’s domain extension came under a “denial of service” attack.

The attack was the largest of its kind ever in China, according to the China Internet Network Information Center, a state agency that manages the .cn country domain.

The double-barreled attacks took place at around 2 a.m. Sunday, and then again at 4 a.m. The second attack was “long-lasting and large-scale,” according to state media, which said that service was slowly being

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China Helicopter Training With Air-to-Air Missiles

A Chinese-developed attack helicopter has successfully fired air-to-air missiles for the first time, state media said Monday, in another apparent advance for the domestic arms industry.

The firing took place last week during drills off the coast of the southern province of Guangdong that were the biggest test yet for the army’s aviation wing, the Xinhua News Agency reported.

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China supports U.N. investigation in Syria, urges caution

(Reuters) – China supports an independent and objective investigation by U.N. experts into allegations of the use of chemical weapons in Syria, China’s foreign minister said on Monday, while urging a cautious response and political resolution to the crisis.

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China’s Reform Anxiety

Since 2010, global financial circles have been obsessing about China’s slowing economy. But, while the country barely met the official target of 7.5% annual GDP growth in the second quarter of this year – generating significant anxiety worldwide – China’s government seemingly remains calm, showing no indication that it plans to launch yet another stimulus package. Do China’s leaders really have the situation under control?

Yao Yang

In fact, the Chinese government’s stance – based on Premier Li Keqiang’s “Likonomics,” which prioritizes structural reform over rapid GDP growth – will prove to be in the best interests of China and the rest of the world. China’s structural problems – including restrictions on labor mobility, a rigid and risk-laden financial system, and excessive reliance on government investment – are threatening its stability and economic development. Given that China’s GDP growth rate remains respectable relative to the rest of the world, the need to emphasize structural reform is clear.

But, despite well-intentioned statements and narrow gestures, China’s new leadership has yet to establish a concrete, bold reform plan capable of resolving the economy’s deep-rooted problems.

For example, last February, the State Council announced plans to reform the hukou (household registration) system, which assigns legal residency according to a person’s place of birth. The system makes relocating very difficult, as those who do not manage to acquire local residency permits face major hurdles in gaining access to public services when they migrate to other provinces. Indeed, their children are even prohibited from taking college entrance exams.

The reform plan was supposed to improve the situation by allowing migrants in towns and small cities to acquire local residency permits more freely, while easing the requirements in medium-sized cities. But efforts to reform the system have been met with strong resistance, especially from local governments and residents, who fear the strain that unregulated migration to their cities will have on resources, employment, and services. As a result, a genuine hukou reform strategy remains elusive.

Similarly, the government has been slow to formulate and implement effective financial-market reforms. Hopes were high early this year, when the State Council announced a strategy aimed at liberalizing the capital account, establishing a more flexible exchange-rate policy, and opening the financial sector to domestic private capital. But the government then heeded influential economists’ warnings of the risks of relaxing capital controls too hastily.

In fact, the opposite should be happening. Narrow policies like the government’s recent credit tightening will make it difficult to direct financial resources to the real economy – one of the primary objectives of “Likonomics.” Genuine progress depends on Chinese leaders’ willingness to address the structural flaws – namely, the restrictions on domestic private capital – that are impeding the financial system’s ability to channel savings to the most promising economic sectors.

Despite several rounds of deregulation, it remains very difficult to establish private banks in China, and rules on non-banking financial institutions are often unclear. As a result, shadow banking, which provides capital at triple the cost implied by the official base interest rate, is flourishing – and generating significant uncertainty and risk. Although the government recently attempted to attract capital back to the official banking sector by eliminating the lending rate’s lower bound, more substantial reform is needed – and that will likely have to wait until the interest rate on deposits is fully liberalized and the financial sector is open to private banks.

In many other areas, too, China’s government either remains indecisive or is offering only rhetoric and small gestures. For example, the devolution of some project-approval powers to local governments will not solve the underlying problem of excessive state intervention in the economy; on the contrary, it may even enhance the state’s role by giving local governments more freedom to carry out investment projects.

China’s leaders know what is wrong with the country’s economy. But, as their efforts over the last several months have highlighted, they are uncertain as to how to go about fixing it – a fact that is generating significant anxiety in financial markets and among the general public. As senior Chinese officials gather for their annual summer meeting in Beidaihe, a coastal resort near Beijing, they must recognize the need for a bold plan for genuine structural reform. Otherwise, anxiety will eventually give rise to mistrust, making a comprehensive reform strategy even more difficult to implement.

Yao Yang is Dean of the National School of Development at Peking University and a professor at the China Center for Economic Research.

© Project Syndicate 1995–2013

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At China’s big trial, Bo Xilai keeps up his counterattack

Jinan, China (CNN) — Fallen Chinese Communist Party heavyweight Bo Xilai kept up his vigorous defense against corruption charges Friday in China’s most politically sensitive trial in decades.

Bo’s glittering career, in which he drew admirers and detractors for his populist policies, fell apart last year amid a scandal involving murder, betrayal and financial skullduggery.

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China says no side should pre-judge Syria chemical probe

BEIJING (Reuters) – China said on Friday that no side should rush to pre-judge the results of any probe by U.N. chemical weapons experts in Syria, after Syria’s opposition accused government forces of using such weapons in an attack on civilians.

The United Nations has demanded Syria give its chemical weapons experts immediate access to rebel-held Damascus suburbs where poison gas appears to have killed hundreds just a few miles from the U.N. team’s hotel.

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Exxon selling Iraqi oilfield stakes to Petro China, Pertamina: Iraq minister

(Reuters) – Exxon Mobil (XOM.N) is selling stakes it controls in Iraq’s West Qurna-1 oilfield to China’s Petro China (0857.HK) and Indonesia’s Pertamina PERTM.UL, the country’s oil minister confirmed on Friday.

“25 percent to Petro China and 10 percent to Pertamina,” Abdul Kareem Luaibi told Reuters on the sidelines of a ministerial meeting here.

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ICBC to Lead China’s Big Banks in Posting Slower Profit Gain

Industrial & Commercial Bank of China Ltd., the world’s most profitable lender, and its three largest local rivals are set to post the slowest earnings growth since 2010 as China’s economy falters and bad loans jump.

The four banks, among the world’s nine biggest by market value, will probably report combined second-quarter net income of 207 billion yuan ($34 billion), an increase of 10 percent from a year earlier, according to the median estimate of 11 analysts surveyed by Bloomberg News. Profit at the four largest U.S. banks climbed 35 percent to $20.2 billion.

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Expectations for Caroline Kennedy

Caroline Kennedy, daughter of the late former US President John F. Kennedy, was nominated to be US Ambassador to Japan. The story has hit headlines in both countries. Naturally, China has also followed the news quite closely. For China, the question is: What role will Ambassador Kennedy play in the three sets of bilateral relations among US, Japan and China at a time when China-Japan interactions are running low? The greatest expectation is for her to make a difference in advancing trilateral cooperation and promoting long-term peace in this sensitive region.

In this connection, Ambassador Kennedy is expected to change the traditional game of showing favor to one country over the other and try to be a fair coordinator between China and Japan. These two countries now have fundamentally different views of history and territorial disputes over the Diaoyu Islands and East China Sea. Though complicated, these questions are not irresolvable so long as the two sides could negotiate and consult with each other calmly. Yet the trouble is that the US, tied by its alliance mentality, has shown partiality for Japan rather than taking a neutral position. This has fuelled not only resurgence of right-wing militarism in Japan, but also nationalism in China, pushing East Asia into a situation more difficult to control. In this process, the Chinese are angered by the Japanese right wing and feel intense aversion for the American partiality. More and more people begin to believe that America’s “pivot to Asia” strategy is actually designed to contain China together with Japan.

Many analysts questioned Caroline Kennedy’s lack of diplomatic experience. But she may always learn from history and bear in mind her father’s A Strategy of Peace speech at the American University: “What kind of a peace do we seek? Not a Pax Americana enforced on the world by American weapons of war.” She may also recall the American nightmares caused by military interventions in Korea and Indochina. She can then think about setbacks in Iraq and Afghanistan and American inability to intervene in Libya or Syria. What will be the consequences of being dragged by Japan into a pointless war in Asia? To realize fundamental US interests in Asia, Ambassador Kennedy will need to show full impartiality between China and Japan, a posture conducive to cooling down Sino-Japanese disputes and pushing the two back to a more rational track of consultation and negotiation.

Ambassador Kennedy is also expected to promote trilateral economic cooperation and trade. According to Eurostat figures published in mid-August, the Euro zone economy had a surprising 0.3% increase in Q2. Growth in the US and Japan in the same quarter were 0.4% and 0.6% respectively. The Chinese economy maintains a high 7.5% growth. Since the outbreak of the global financial crisis at the end of 2008, the US, China, Japan and Europe, the four major economies in the world, have for the first time all registered growth, something that has not come easily and must therefore be treasured. Although we cannot yet conclude that the crisis is over people do see light at the end of the tunnel from this. With prospective recovery, total world trade is expected to increase in the second half of this year. China, the US, Japan and EU will speed up export and also buy more on the international market, benefiting the whole world and laying down a more solid foundation for recovery. Economic growth is at the core of any country’s national interest. Economic relations and trade between China, US and Japan link the three countries closely together and the level of interdependence assures that they have to share weal and woe. Commitment to promoting trilateral economic cooperation and trade will be Caroline Kennedy’s key to a successful ambassadorship.

Ambassador Kennedy is further expected to express criticism of the growing rightist tendencies in Japan. She will arrive in Tokyo at a sensitive moment: the right wing is getting full steam to challenge the post-World War II institutional arrangements. According to a recent Financial Times article, longtime resident of Tokyo called this government “Japan’s most nationalistic government since 1945″. In his speech to mark the 68th anniversary of Japan’s surrender in World War II on 15 August, Prime Minister Shinzo Abe omitted any reference to remorse or apology for the great sufferings Japan inflicted on Asian peoples. He did not repeat either the vow of not going to war again made when he was Prime Minister last time. Japanese Deputy Prime Minister Taro Aso talked about learning from Nazi Germany’s model of changing Japan’s peace constitution. These developments reveal a horrifying attitude, i.e., “the only mistake Japan made during World War II was to lose the war.” This naturally outrages China, Korea and Southeast Asian countries and surely cannot be accepted by the US, which fought a bloody war with the Japanese fascists in the vast Pacific Ocean. Ambassador Kennedy may well realize that history has a direct bearing on reality and that ambiguity on any question of principle will indulge Japan towards provoking another war in Asia. On the other hand, bashing the belligerent right wing and steering Japan back to rationality actually demonstrates concern for Japan so that it can be free from another devastating blow, greatly promote peace in Asia and contribute to America’s core interest in Asia.

Ambassadorship was a starting point for the Kennedys’ political career. In 1937, Joseph Kennedy became US Ambassador to UK as appointed by President Roosevelt. Caroline Kennedy has been away from politics for many years. And this time she has on her shoulders the tasks of both serving the country and upholding the family honor. Chinese people have much to expect from her. So long as she does a good job in the three above-mentioned aspects, Ambassador Caroline Kennedy will be hailed as greater than her grandfather Joseph in adding another chapter of glory to the Kennedy family.

Dr. Jin Ying, Associate Researcher, Institute of Japanese Studies, Chinese Academy of Social Sciences.

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