Posts tagged ‘capitalism’

Thursday, August 11, 2016

Bank of China: Brexit Risks and Opportunities

The following is an article initially published by Pengpai News (澎湃新闻), an internet news portal apparently operated by Oriental Morning Post (or Dongfang Morning Post),  a paper from Shanghai. According to Radio Free Asia (RFA), the paper’s then director Lu Yan (陆炎) and  deputy editor-in-chief Sun Jian (孙鉴) were removed from their posts in summer 2012. According to the Committee to Protect Journalists (CPJ), Yu Zhengsheng (俞正声), Shanghai CCP secretary at the time, had been “unhappy” with Oriental’s stories. Sun Jian apparently re-emerged later, as the name was mentioned as the concurrent director of  Oriental Morning Post’s and Pengpai News’ economy and finance news centers, in a “People’s Daily” article published in 2015, praising the innovative practice at integrating the paper and its internet platform.

Either way, the news portal’s article about the BoC’s meetings with overseas financial administration dignitaries apparently appealed to the Communist central bankers – it was republished on the BoC’s website, two days after its original publication. Here goes.

The last meeting of G-20 finance ministers and central bank governors before the G-20 summit in Hangzhou was held in Chengdu, with [Chinese] central bank governor Zhou Xiaochuan opening intensive meetings with high monetary officials from a number of countries.

G20杭州峰会前最后一次G20财长和央行行长会议在成都召开,央行行长周小川又开启了密集会见各国财金高官模式。

According to the People’s Bank of China’s official website, Zhou Xiaochuan, on July 23, met with American treasury secretary Jack Lew, Britain’s newly-appointed chancellor of the exchequer Philip Hammond, Argentine finance minister Alfonso Prat-Gay and Argentine central bank governor Federico Sturzenegger.
That said, this kind of officially issued information is generally rather simple. For example, at the meeting with the British finance minister, the two sides exchanged views on Britain’s withdrawal from the EU, the strengthening of Sino-British financial cooperation and other issues; at the meeting with the US finance minister, the two sides mainly exchanged views on the global financial markets’ situation, about the Chinese and American economies and finances, and policy coordination under the G-20 framework; and at the meeting with the two high Argentine officials, the two sides exchanged views on the international economic and financial situation, the macroeconomic Chinese and Argentine situations, the strengthening of Sino-Argentine financial cooperation and other issues.

据中国人民银行官网消息,7月23日,周小川已先后会见了美国财长雅各布•卢、英国新任财政大臣哈蒙德、阿根廷财政部长盖伊和阿根廷央行行长斯图森内格。
不过,这类会见官方发布信息均比较简单。比如,会见英国财长,双方就英国退欧、加强中英两国金融合作等议题交换了意见;会见美国财长,双方主要就近期全球金融市场形势、中国和美国经济金融形势,以及G20框架下的政策协调等问题交换了意见;会见阿根廷两高官,双方主要就国际经济金融形势、中阿宏观经济状况,以及加强中阿两国金融合作等议题交换了意见。

Currently, Britain’s withdrawal from the EU is undoubtedly a hot topic, but the central bank didn’t disclose any details. Still, the British finance minister’s time’s itinerary suggests that while withdrawing from the EU, they didn’t forget to to sell themselves.

眼下,英国退欧无疑是热门话题,不过央行并未透露任何细节。但从英国财政部此次行程来看,他们在退欧的同时,仍不忘推销自己。

According to the Bank of China, the “Sino-British Financial Services Round Table Meeting”, organized by the British embassy and co-hosted by the Bank of China, was held in the BoC’s head office’s mansion in Beijing, on July 22. British chancellor of the exchequer Philip Hammond, British deputy chancellor of the exchequer [Mark Bowen?], British Ambassador to China Dame Barbara Woodward and other British government representatives, as well as People’s Bank, the CBRC, the State Administration of Foreign Exchange, and big financial organisations and more than 40 high-ranking officials were guests at this meeting.

据中国银行消息,7月22日,由英国大使馆主办、中国银行协办的“中英金融服务圆桌会”在北京中国银行总行大厦举行。英国财政大臣菲利浦•哈蒙德、英国财政部副部长马克•博文、英国驻华大使吴百纳女爵士等英方政府代表,以及人民银行、银监会、外管局和中英两国大型金融机构的高管共约40多人作为受邀嘉宾出席了本次会议。

Hammond said at the meeting that the British economic fundamentals after the “Brexit” referendum remained fine, that Britain would continue to play an important role in the international arena, that British commerce, financial services and investment would, just as in the past, be open and competitive, and the British government would attach yet more attention to cooperation with China in the financial field.

哈蒙德在会上表示,英国公投“脱欧”后经济基本面依然良好,英国将继续在国际舞台上扮演重要角色,英国的商务、金融服务和投资领域也将一如既往地呈现开放、竞争的态势,英国政府将会更加重视在金融服务领域与中国的合作。

Chairman of the BoC board Tian Guoli said that Britain’s position in the fields of international politics, economics, and finance was highly influential. As far as Chinese and British investors were concerned, there were interdependent “risks” and “opportunities” in the “Brexit”, with both challenges and opportunities. To safeguard Chinese and British investors’ interests, there should be a continuation of promoting the two countries’ economic and trade development, global financial stability, the suggested common promotion of the building of “one belt, one road”, active participation in China’s supply-side structural reforms, the strengthening of financial cooperation, and the acceleraton of building London as an offshore center for the RMB.

中行董事长田国立则表示,英国在国际政治、经济、金融领域的地位举足轻重。对中英两国投资人而言,英国“脱欧”“危”“机”相倚,挑战与机遇并存。为守护中英投资人利益、持续推动两国经贸发展、促进全球金融稳定,建议中英双方共同推动“一带一路”建设,积极参与中国供给侧结构性改革,强化金融合作,加快伦敦人民币离岸中心建设。

At the meeting, participants discussed the two topics of “Seen from the perspective of the financial industry, Britain after the ‘Brexit’ remains a good destination for overseas investment” and “The important role of Britain as a good partner in the development and opening of the Chinese financial industry”.

会谈中,与会代表就“从金融业角度看英国‘脱欧’后仍是海外投资的良好目的地”和“在中国金融业发展开放过程中,英国如何发挥好合作伙伴的重要作用”两个议题展开讨论。

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Related

» Whose Gateway, Nov 24, 2015
» 媒体融合中, “People’s Daily” online, Sept 17, 2015
» Locomotion, Finance, Energy, July 27, 2014
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Updates/Related

» Propaganda 2.0, The Economist, Dec 13, 2014
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Sunday, May 22, 2016

Is the Left right after all?

Thanks for → asking, Mr. Moore. It’s only a first step, and a late one at that, but if the left is as dumb and if conservatives are as smart as you claim, I’m sure you’ll arrive at some good conclusions. Will you continue to ask these questions after Brexit, too?

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Related

Bigoted elite, Charles Moore/Telegraph, March 4, 2016

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Friday, April 8, 2016

The Panama Papers: Invested, but not Koppied

You needn’t be there yourself, but should your money? Those places are beginning to look like those parties you simply have to get an invitation to, if you want to matter: the “havens” where (many of) the rich and beautiful put their money. The Virgin Islands, for example. Or Panama. Or Luxemburg? Not sure. Ask a bank.

Reportedly, some members of Vladimir Putin‘s tight-knit inner circle do it. Reportedly, Hong Kong movie star Jackie Chan (成龍) does it. So do Thais. Lots of Indians, too. And maybe many Americans, but elsewhere.

Others, also reportedly, did so in the past. One of them even says that he lost money in the game.

But not so fast. Media tend to scandalize everything, don’t they?

According to ICIJ, the documents make public the offshore accounts of 140 politicians and public officials. The documents don’t necessarily detail anything illegal, but they do shine a light on the shadowy world of offshore finances,

National Public Radio (NPR) informs its listeners.

So, let’s not jump to conclusions. The problem, either way, is that the investors’ countries’ governments can’t get a picture of what is there. And once an investor is found on a list like the “Panama Papers”, with investments or activities formerly unknown to his country’s fiscal authorities (and/or the public), he’s got something to explain.

Like Argentine president Mauricio Macri, for example.

So, it’s beautiful to have some money there.

Unless the public begins to continuously ask questions about it.

Timely Exits from Paradise

If British prime minister David Cameron is right, the money he and his wife earned from an offshore trust were taxed. His problem, then, would be the general suspicon of the business.

The Cameron couple reportedly sold their shares in question in 2010, the year he became prime minister.

“Best Effect” and “Wealth Ming” reportedly ceased operations in 2012 and/or 2013. That was when CCP secretary general and state chairman Xi Jinping took his top positions. The two companies had been run in the Virgin Islands, and Deng Jiagui (邓家贵), husband to Xi’s older sister, had been the owner, Singaporean paper Zaobao reported on Tuesday.

And then, there’s Tsai Ying-yang (蔡瀛陽), one of the 16,785 Taiwanese Mossack Fonseca customers, the law firm the “Panama Papers” were leaked from. According to his lawyer, Lien Yuen-lung (連元龍), Tsay Ying-yang terminated his Koppie Limited company as soon as in 2009, the year following its establishment, so as to cut the losses – 30 percent of the investment, according to a phone interview Lien gave Reuters, as quoted by the Straits Times.

Tsai Ing-wen hasn’t commented herself, and maybe, she won’t any time soon. It doesn’t seem that too much pressure has mounted so far. But questions are asked all the same. On Wednesday, KMT legislators William Tseng (曾銘宗), Johnny Chiang (江啟臣), and Lee Yan-hsiu (李彥秀) told a press conference that in the “many cases” where the Tsai family had encountered controversy, Tsai Ying-yangs name had emerged, and this “gave cause for doubts” (會起人疑竇).

An Emerging KMT Opposition Pattern

William Tseng may become a regular questioner, concerning the financial affairs of Tsai’s family people. One of the “controversies” he had quoted had been the issue of a press conference on March 24. There, with different KMT colleagues,  but the same kind of artwork on the wall behind the panel, showing the suspect of the day, Tseng dealt with the issue of Academica Sinica president Wong Chi-huey‘s daughter’s role as a shareholder of OBI Pharma Inc..

KMT legislators press conference artwork

KMT representations:
Mind the guys in the background

One of his fellow legislators, Alicia Wang (王育敏), raised the issue of the company’s shareholder structure (and neatly placed Tsai’s brother there, too, maybe just to make his name available for quote by Tseng on other occasions:

“President-elect Tsai Ing-wen’s (蔡英文) brother and sister-in-law are also shareholders, and so is Wong’s daughter, Wong Yu-shioh (翁郁秀). Are others involved?”

Diplomatic Relations, but no Tax Treaty

The “Panama Papers”, as far as they concern Taiwanese customers, contain not only individuals, but companies, too: Taiwan Semiconductor Manufacturing (founding chairman Morris Chang, who served Taiwan as APEC representative in 2006), TransAsia Airways (more recently in the news for the tragic Flight 235 crash), Yang Ming Marine Transport Corporation, Wei Chuan Food Corporation (in the news since 2013), and the Executive Yuan’s National Development Fund.

The Development Fund was not a taxable organization, Taiwan’s foreign broadcaster Radio Taiwan International (RTI) quotes finance minister Chang Sheng-ford. He used the example to make the point that to suggest that some 16,000 keyword search results for Taiwan in the “Panama Papers” did not signify 16,000 cases of tax evasion. That’s just not the way to look at it.

Chang reportedly also said that while, “if necessary”, Taiwan would establish a Panama Papers working group and start investigating the most high risk people and agencies for tax evasion, the country had no tax treaty with Panama. Also, a Taiwanese anti-tax evasion law had not yet been passed.

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Related

The Panama Papers
Achselzucken schadet, Der Freitag, Apr 7, 2016
The Panama Papers, FoarP, Apr 6, 2016

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Friday, April 1, 2016

Media Coverage on Ministry of Education’s (MoE) “Blue Book” on Returning Overseas Students and the Labor Market

The Chinese ministry of education (MoE) published a “blue book”, or a government report, on March 25, concerning overseas Chinese students returning to China, and looking for a job there. If Chinese press and government agency coverage on the report is something to go by, this is what the average academic returnee to the motherland looks like:

he is actually mostly a she (59.16 percent of the returnees are female), aged 23 to 33 (absolute average 27.04 yrs old), a masters student (80.7 percent), a postgraduate (9,49 percent), or an undergraduate / a student with a specialized subject (9.81 percent combined). If a postgraduate, his main fields should mainly be chemistry, material science, economics, electronics and electrical engineering, while the masters fields of study are somewhat more into the direction of finance, accounting, business management, management studies, or international business studies.

Statistics seem to suggest that there have been more returnees recently, than the 1978 to 2015 average numbers. Either way, the MoE’s Overseas Students’ Support Center deputy director Xu Peixiang (徐培祥) is quoted as saying that some 70 to 80 percent of students, in recent years, have returned after their studies abroad.1)

97 percent of those who currently study abroad are doing so at their own expense, which appears plausible when looking at the total numbers. In 2015 alone, 523,700 students reportedly left for studies abroad, and 409,100 job-seeking overseas students returned to China that year. By comparison, 248 students left China for studies abroad in 1978, according to Xinhua newsagency.

Very rough calculations with many unknowns: given that 459,800 Chinese left China to study abroad in 2014, according to this government-agency news report, the average of students leaving in 2014 and 2015 combined would be (459,800 + 523,700)/2 = 491,750, and based on an average duration of 22 months (more precisely 21.47 months) of studies abroad among the 2015 returnees,  this would mean that about 901,542 Chinese students would currently be abroad.

Three percent of these would then not study at their own expense (or that of their parents, relatives, etc.). Some 27,000 of the 901,542 abroad would, based on my shoddy calculation, study with a government grant, a scholarship, etc.. And probably, very few, if any, among the 248 who went abroad in 1978, were self-paying students.

23.85 percent of the 2015 returnees have been looking for a job in state-owned companies, 19.4 percent prefer minban operations2), and foreign-invested enterprises, state institutions and financial institutions rank third, fourth and fifth, respectively, in the returnees search settings. Only 3.32 percent want to establish businesses of their own (one percentage point up, compared to the 2014 returnees).

When it comes to location and company types, the returnees haven’t necessarily followed their ideas of perfect companies and locations, but looked at some hard facts (and regulations), and have therefore looked for jobs that appeared to be closer within their reach. Either way, Beijing, Shanghai, Guangzhou and Shenzhen are still very popular destinations, with 49.34 percent indicating these goals, but this is said to be eight percentage points less than in 2013. This share is now basically focused on other provincial-capital-level cities.

Being in a position to pay for ones studies abroad doesn’t necessarily translate into perfect (or labour-market-oriented) choices, according to the news coverage. Qi Mo (齐默), head of the returnee office at the MoE, is quoted as stating “a certain blindness” in terms of how students (and their parents) are choosing fields of studies (or majors) and places (cities and universities) abroad. Hence, the MoE was trying to provide candidates for self-paid overseas studies, as well as their families, with information to support their choices, according to Qi.

It isn’t strongly highlighted in the news, but it becomes fairly evident that while Xu Peixiang points out how returning overseas students have become a group that receives great attention at our country’s market of talents, there may be particular challenges for returning overseas students, too. When a Xinhua article mentions measures like bases (or opportunities) for practical work as supportive measures for returnees to integrate into the labor market (this might also be translated as internship opportunities), you might suspect some frustration and trouble there. After all, such “opportunities” are hardly the financial return self-paying students (and their families and networks) would expect on their investment (or borrowings).

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Footnotes

1) According to statistics quoted in the Chinese press coverage on the MoE “blue book”, 4.04 million Chinese students have studied abroad from 1978 to 2015. 2.22 million of them have returned so far.

2) minban is a poorly defined term. There are, of course, many ways to find definitions anyway. Dorothy J Solinger, in “China’s Transition from Socialism”, first published in 1993, suggested that

there are three main types: those […] which are supposedly owned and managed by “people” (minyou-minban); those owned by the state but managed by “people” (guanyou-minban); and those jointly operated and owned by the state and the “people” (guanmingongyou).

And in 1999/2000, Guoqiang Tian, now a professor at Texas A & M University and in China, discussed in a paper on Property Rights and the Nature of Chinese Collective Enterprises why collective enterprises, especially township and village enterprises (TVEs) had – those sixteen years ago, anyway – developed more rapidly than privately owned enterprises, in China.

General note: I have no information about survey’s return rate among the former overseas students.

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Friday, January 8, 2016

Human Rights and Economic Records: Botched Measures and Terrible Occurrences

Before the old (lunar) year leaves and a new comes in, things need to be tidied up in China. However, efforts to calm the stock markets by new management measures appear to have been unsuccessful. And in Hong Kong, where RMB trading, is unrestricted, people pay less for China’s currency, according to the New York Times.

There’s still other bad news, and the indicator in this case, too, is Hong Kong.

“Something terrible has happened. We are all afraid. We are leaving now,” an employee told me a few hours before locking the doors for the foreseeable future.

That’s how the BBC‘s correspondent in the former British colony, Juliana Liu, concluded an entry in the broadcaster’s China blog on Monday, and the topic, of course, is the case of five Hong Kong citizens, all associated with the Causeway Bay Bookstore, who have gone missing since October last year. The latest case is Paul Lee, and he went missing late in December.

Hong Kong’s SCMP, one of East Asia’s leading English-language papers, but one with an uncertain future, reported on Monday the first precept speech by a Chinese leader since Mao Zedong. The guy who’s imitating the late great dictator is, of course, current party secretary general, state chairman, and the central military commissions’ (CMC) chairman Xi Jinping. The speech is seen as part of Xi’s efforts to reform China’s military, but obviously, the – probably intended – signal goes beyond the armed forces project.

Given that no other former CMC chairman, from Deng Xiaoping to Hu Jintao, had given a military precept, an associate professor at Shanghai University of Political Science and Law concludes that Xi’s power and authority is even higher than them.

This may or may not be true. If  Wang Qishan, rather than Li Keqiang, ranks second in terms of power or influence within the party, the assessement may be correct. But then, maybe Deng Xiaoping, who faced open ideological competition at times by more conservative party veterans like Chen Yun, simply didn’t need to show off his autority by admonishing the military.

Back then, too, the party was corrupted. But that was at a time when – or that’s how it felt, anyway – everyone had a chance to become rich. Now, there’s a two-fold challenge of corruption and slowing growth.

This could mean that Xi has powers because potential rivals do not want to challenge him, so as not to rock the not-so-stable boat.

If China’s regime manages the switch from an export-led economy to a more services-oriented economy successfully, the doubts in Beijing’s macro-economic control of the economy won’t persist – some disappeared people, in China or elsewhere, have never been a great concern to business.

All the Xidadamania aside however, confidence in mainland China, in Hong Kong, and abroad, appears to be slipping, at least currently.

In an interview with German national radio on Thursday, Markus Taube, a professor at a university in Germany’s Ruhr region, stated “a massive loss of confidence” in China:

What we see in China at the moment, definitely, is a massive loss of confidence. All market actors can see that the CCP has clearly lost its former control capacity. Until now, the Chinese market was always a very [unreadable] […]. Now, this ability to lead isn’t in place and that the state has failed several times, on its own promises.

Das, was wir in China momentan definitiv sehen ist ein massiver Vertrauensverlust. Alle Marktakteure sehen, dass die Kommunistische Partei offensichtlich ihre frühere Steuerungskapazität verloren hat. Bislang war der chinesische Markt immer ein sehr [unreadable] … Fundamentaldaten haben da kaum eine Rolle gespielt, und es war das Vertrauen einfach da, dass die Partei, der Staat, im Endeffekt die Richtung vorgibt [unreadable]. Jetzt ist es so, dass diese Führungsfunktion fehlt und dass der Staat mehrfach versagt hat, auf seine eigenen Versprechen hin.

Not least, Taube said, the “anti-corruption campaign” has discouraged Chinese decisionmakers in charge of approving (or delaying) investment projects.

Given that Chinese control mechanisms – concerning the financial markets – are out of order, Taube, with an audible sigh, introduces an old friend from the 2009 tool cabinet:

It sounds unorthodox, but probably, in the current situation, it would be more appropriate to issue another stimulus package, in that the state, again, to a great extent, pumps money into the economy. A classical Keynesian stimulus package to create state-induced demand so as to restore the economic dynamics on a basic level.

Es klingt sehr unorthodox, aber wahrscheinlich ist es in der momentanen Situation tatsächlich eher angesagt, ein klassisches Konjunkturpaket wieder aufzusetzen, einen Stimulus, in dem der Staat einfach in großem Maße wieder Geld in die Volkswirtschaft hineinpumpt. Also ein klassisches keynesianisches Konjunkturprogramm, in dem einfach staatlich induziert Nachfrage geschaffen wird, und damit einfach die volkswirtschaftliche Dynamik auf einem grundlegenden Level wieder stabilisiert wird.

That said, Taube doesn’t judge the situation by standards of five-year plans, or by taking the long view, as recommended by the Lord of the Confucius Institutes. Taube advocates a stimulus because the methods tried more recently haven’t worked and wouldn’t turn the tide for the coming six months.

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Updates/Related

» Executives Disappearing, HP, Jan 8, 2016

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Sunday, November 1, 2015

Angela Merkel’s 8th Visit: another two Days in China

Angela Merkel was to meet Xi Jinping on Thursday, her office’s website wrote earlier this week, referring to the state chairman and party secretary general as “president”. That’s routine in German federal and regional authorities’ contacts with China; party affiliations and roles are mostly ignored.

It was Merkel’s eighth visit to China, Xinhua newsagency informed statistics-obsessed readers. She first visited in August 1997, then as minister for environment protection and nuclear reactor safety. Visits as chancellor followed in May 2006, August 2007, October 2008, July 2010, February 2012, August 2012, and in July 2014.

An End to the “Golden Decade” of German-Chinese Cooperation?

Germany’s press is diverse at first glance, but much of what ends up in regional papers is written by relatively few correspondents or editorialists in Berlin, pooled in news agencies and correspondent’s offices that offer their services to any paper in the market. “Die Krisen reisen mit” (Crises travel along), written by two Deutsche Presseagentur (DPA) correspondents, was published by a number of small or medium-sized regional papers. Sebastian Heilmann, a sinologist, is quoted as saying that London had assumed the leading role in relations with China (this probably refers to the leading role in the European Union).

But the DPA article doesn’t want to leave Heilmann’s remarks uncontested:

That Cameron, all of a sudden, only leers at business doesn’t necessarily suggest convictions and reliability, as can be read from internet users’ sardonic remarks. The chancellor enjoys much greater esteem. But Xi was probably happy to see the human-rights topic basically dropped under the table in London, and the Europeans being split. The [German] federal government takes no stock in this kind of policy changes and remains firm in its critical China policy. Chinese people appreciate reliability. Even the strength of Germany’s industries alone would ensure Germany’s position as China’s “definitely strongest trading partner”, the chancellery believes.

Dass Cameron plötzlich nur noch auf das Geschäft schielt, spricht auch aus chinesischer Sicht nicht unbedingt für Überzeugungen und Verlässlichkeit, wie aus hämischen Kommentaren von Internetnutzern erkennbar wird. Da genießt die Kanzlerin viel größere Wertschätzung. Aber Xi dürfte sich gefreut haben, dass das Thema Menschenrechte in London praktisch unter den Tisch gefallen ist und hier ein Keil zwischen die Europäer getrieben werden konnte. Die Bundesregierung hält von solchen Kurswechseln aber nichts und bleibt in ihrer kritischen China-Politik standhaft. Die Chinesen wissen Zuverlässigkeit zu schätzen. Schon wegen der Stärke der deutschen Industrie werde Deutschland auch “mit Sicherheit der stärkste Handelspartner” der Chinesen  bleiben, glaubt man im Kanzleramt.

Deutsche Welle’s Mandarin service is more elaborate, drawing on a press release from the Mercator Institute for China in Berlin, r rather on the institute’s trade magazine “China Flash”. In an interview with the magazine, Heilmann, the institute’s director, said that Chinese demand for industrial commodities was going down, and at the same time,

there’s a certain disillusionment on the Chinese side, because jointly agreed projects are stagnating: from the Chinese perspective, German industry is too passive in technological cooperation, and the federal government has given too little profile to the issue.

auf chinesischer Seite eine gewisse diplomatische Ernüchterung, weil gemeinsam vereinbarte Projekte stocken: Aus Sicht der Chinesen ist die deutsche Industrie in der Technologiekooperation zu passiv, und die Bundesregierung hat das Thema Innovationspartnerschaft zu niedrig aufgehängt.

As for an action framework for innovation partnership, adopted in Berlin in October 2014, with Chinese chief state councillor Li Keqiang and Merkel in attendance, Merkel would “need to cheer up disappointed interlocutors in Beijing”:

Peking had hoped that German companies would procure Chinese companies with innovative know-how on networked production. However, German companies are understandably skeptical: Industry 4.0 is about fundamental, sensitive future technology. The question if this kind of know-how can be protected in the Chinese context must be answered in the negative, at present.

Peking hatte gehofft, dass deutsche Unternehmen chinesischen Firmen innovatives Wissen zur vernetzten Industrieproduktion beibringen. Doch deutsche Unternehmen sind verständlicher Weise skeptisch: Bei Industrie 4.0 geht es um elementare, sensible Zukunftstechnologien. Und die Frage, ob solches Know-how im chinesischen Kontext geschützt werden kann, muss man derzeit klar verneinen.

In Heilmann’s view, Germany losing its status as an “anchor state” for Chinese engagement in Europe shouldn’t simply be attributed to London’s “fulminant diplomatic campaign”, but to intensifying Chinese interest in international financial markets and tertiary-industry-related know-how.

Meantime, the federal government, in its announcement of Merkel’s visit to China, stated that Berlin’s goal was a balance between economic/technological, and social issues, and to include issues of global order, as well.

Human Rights: “Huanqiu Shibao” pities Merkel

Heilmann doesn’t seem to agree that China’s leaders would appreciate the federal government’s “critical China policy” (see first blockquote). It would be quite possible, Heilmann told “China Flash”, that Chinese government representatives wouldn’t listen to German expostulations “as patiently as they did last year”.

One had to pity Merkel, Huanqiu Shibao wrote in a slightly satirical article, republished here by Guanchazhe (Shanghai) on Thursday:

Today and tomorrow; German chancellor Angela Merkel visits China. So-called human-rights organizations like Amnesty International responded right away, on receipt of the news. This organization, which frequently causes China trouble, as well as the disreputable organizations “World Uyghur Congress” and “International Campaign for Tibet” recently published a joint open letter to Merkel and demanded that she should voice “concern regarding the situation in Chinese judiciary” and to voice her “support for suppressed Uyghur human rights lawyers”.

德国总理默克尔今明两天正式访问中国,大赦国际等所谓人权组织闻风而动。这家经常向中国发难的组织与臭名昭著的“世界维吾尔大会”及“世界声援西藏组织”日前联名给默克尔发公开信,要求后者在访华期间提出“对中国司法现状的担忧”,表达“对被打压维权律师的支持”。

“Tibetan-independence” and “Xinjiang-independence” organization in Western exile have apparently learned something new, adding new concepts like “situation in Chinese judiciary” and “Uyghur human rights lawyers”. That’s very amusing.

流亡西方的“藏独”和“疆独”组织看来最近加强了学习,用上了“司法现状”和“维权律师”等新词,还与大赦国际搞到一起“抱团取暖”,联合挑事,蛮是有趣。

From the perspective of the large public in mainland China, Western leaders who sing the praise of human rights every time when visiting China, come across as somewhat strange. Above all, what they mean by human rights is often different from what Chinese the common people mean. For example, Chinese people are above all concerned by social justice, with educational justice and fair access to medical treatment, home ownership, care for the elderly, etc..

对中国大陆数量庞大的公众来说,西方领导人每次到中国访问时总要像念经背书一样谈谈人权问题,有些怪怪的。尤其是他们说的人权与中国老百姓最关心的权利常常不是一回事,比如中国人最关心社会公平,包括受教育公平、医疗资源公平等,还希望居者有其屋,人人老有所养等等。

Chinese people also want rule by law, they hope for unrestricted freedom of speech, and more democratic government. As far as these [issues] are concerned, the country has a diversity in practice, keeps summing up experiences, and indeed, there are problems on government level that need to be solved. Concepts like democracy and rule by law have found their way into socialist core values. In fact, Chinese society, more than any external force, is more concerned with doing this well, and engages in exploring these issues.

中国人还要求法治,希望言论开放,国家治理更加民主。关于这些,国家有种种实践,不断总结经验,也的确有些治理层面的问题需要破解。民主、法治这些词汇都进入了社会主义核心价值观,究竟怎么做好,中国社会比任何外部力量都更加关心,也在实际探索并努力。

When foreigners talk to China about human rights, this frequently refers to the tiny minority of people who are in jail for challenging China’s political system, defined by the constitution and rules, in a way that  is relevant under criminal law. Our strong impression is that they [foreign visitors] aren’t concerned about Chinese human rights which are constantly improving, that they aren’t concerned for the growing prosperity of a majority of Chinese people, but that they [my translation for the rest of this line may be rather vague or inaccurate – JR]  want to help those who seek confrontation with the Chinese system. By this, they want to cause China trouble and force China to adopt government methods that don’t fit this country.

外国人向中国一谈人权,指的往往是为挑战中国宪法规定 的政治制度而触犯刑法,并因此坐了监狱的极少数人。给我们的强烈印象是,他们不是关心中国人权基本面 的不断改善,不是关心绝大多数中国人的福祉,而是要帮助能数得过来的与中国体制搞对抗的人,他们是要以这种方式找中国麻烦,逼中国采取不适合自己的国家治 理方式。

 Many people from the West say that they are sincerely concerned about human rights and that they can’t ignore the arrests of “dissidents”. But apparently, they don’t understand what those “dissidents” did, that they weren’t seized for “differing opinions”, but for doing things, because of their “different opinion”, that are banned by Chinese law.1)

One had to understand that China frequently gave cause to misunderstandings, Huanqiu Shibao wrote. After all, this was a big world, and far-away China was therefore not easy to understand. However, Western people with strong views about intervention in China should know how to behave in delicate situations. This wasn’t the era of the eight-nation alliance, and China wasn’t in the [weak] position anymore to beg for capital or technology.

Self-confident as Chinese society is today, people know that there are individual Western leaders who visit China with the tic of discussing “human rights”. Therefore, [Chinese people] feel a bit sorry and pity visitors who need to grit their teeth and shoulder the task of discussing “human rights”, so as to report to their superiors at home afterwards. Apparently, Chinese society is more generous than societies that exert pressure on their leaders, and are at times understanding.

中国社会如今自信了,知道西方有个别领导人访华谈“人权”的怪癖,因此对来访领导人要硬着头皮说句“人权”回去交差,有那么点同情和怜悯。怎么办呢,中国社会看来比在后面逼那些领导人的社会大度些,有时也就谅解了他们。

If the Western societies didn’t know how rotten the game in question was, remained unknown, wrote, Huanqiu Shibao. But if the window speeches absolutely had to continue, China would be of help.

“People’s Daily”: Japan should learn from Germany, and from Britain, too

If the Sino-British era is to become about as successful as the preceding Sino-German tandem, remains to be seen. Either way, much seems to suggest that human rights issues are now considered useless obstacles for relations with China.

Hua Yiwen (华益文), an author for the party’s central newspaper People’s Daily, thinks that both sides, Beijing and London, have given a sincere representation of Sino-British relations, with a strategic positioning and a harmonic diversity that made the Chinese public’s positive view of Britain rocket upwards.2)

That said, Hua isn’t as dissatisfied about Germany either. The really bad guys are the Japanese. If one saw how actively both Britain and Germany developed their ties with China, one couldn’t help but think of Japan. Different from Germany, Japan hadn’t dealt with its history, and that was affecting Sino-Japanese relations. And while London’s policies were marked by strategic far-sightedness and political courage, the Abe government had decided “to join the US and to bang the gong of a ‘Chinese threat’, thus paving the way for a Japanese military security policy of its own, and thus adding a complication factor to Sino-japanese relations.

Human Rights: Merkel meets Activists

Angela Merkel reportedly held a private meeting with nine activists at the German embassy in Beijing on Thursday evening, risking host’s ire.

The risk of the CCP leadership’s ire is exaggerated: after all, this isn’t the first meeting of this kind, and if China’s leaders had seriously objected, and considered it worth the price, they could have barred all nine activists from the meeting, as Mo Shaoping, who was invited to such a meeting in February 2012, can tell from his own experience.

Next in the visitors’ line is French president Francois Hollande, scheduled to arrive in Beijing on November 2. State council foreign-language website china.org quotes Zhou Yongsheng (周永胜) of the Chinese University for Foreign Affairs. interprets the visits, closely following each other, as “illustrating the growing influence and the position of power held by China, as acknowledged and appreciated by numerous great countries”.

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Notes

1) Probably, the Chinese dissident who is most prominent abroad should be Liu Xiaobo. (He’s hardly known or remembered within China.) He has been under arrest continuously since December 2008, and was sentenced in December 2009, for “inciting subversion of state power”. As far as I can tell, there were no clear-cut reasons given for the judgment. A conjecturable motive for seizing Liu Xiaobo could be the Charter 08, co-authored by Liu and about to be published at the time.

2) How sustainable “the Chinese public’s benevolence” and the foundations of the “British-Chinese Golden Decade” can be will also depend on a factor that could sound familiar to a message London received from Washington nearly three years ago. Back then, US president Barack Obama had informed David Cameron that he valued a strong UK in a strong European Union. Same message from Xi Jinping, according to Xinhua last week:

Xi Jinping emphasized that the European Union was China’s partner in a comprehensive strategic partnership. China hoped for a prospering Europe, a united Europe, and for an important EU member country, Great Britain, playing an active and constructive role in promoting and deepening Chinese-European relations.

习近平强调,欧盟是中国的全面战略伙伴和最大贸易伙伴。中国希望看到一个繁荣的欧洲、团结的欧盟,希望英方作为欧盟重要成员国为推动中欧关系深入发展发挥更加积极和建设性的作用。

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Related

» Internet Revolution, Chinese concept, April 17, 2015
» Hometown Diplomacy, China Daily, Oct 30, 2015

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Sunday, October 18, 2015

The Tories and the CCP

Update, Oct 22: a try with a ballpen

Update, Oct 22: a try with a ballpen

Let’s stick together to make Britain China’s best partner in the West.

Gee. I’m not young anymore, and I think I’ve seen a bit of the world, but probably nothing as big as this slime trace. Seems to remind me of the old fairytale: if you can’t throw a frog against the wall anymore, start kissing his ass.

Sunday, September 13, 2015

Weekend Links: O2O Business in China

Warning: JR is trying to explain the economy to himself. His word pool and previous knowledge about this topic are shaky, and the following may or may not make sense – you’ll have only have yourselves to blame if you base your homework (or investment decisions) on this post.

Going “Brick-and-Mortar”

Let’s get industrial. O2O is about [people] buying things online, but collecting them from a shop on their side of the computer or smartphone – or having the stuff delivered to their doorstep. But China’s woefully inefficient logistics network .. acts as a brake on e-commerce growth, the Economist wrote in August, and that leads to online retailers seeking “brick-and-mortar” outlets to increase the points of delivery and to make their goods more accessible for their online customers.

Dalian Wanda Group’s (万达集团) and Suning Commerce Group (苏宁云商) are a recent example in the news. Wanda’s property development section (the company’s other major trades would be culture and tourism)  provides department stores or plazas all over the country, and Suning Commerce Group is a retailer with reportedly more than 1600 stores across mainland China, Hong Kong, and Japan. The two have signed a cooperation agreement: Suning will open stores at Wanda Plazas throughout the country, Reuters wrote on September 6.

National Soft Power, too

China News Service (CNS) explained, on September 7:

Suning coming into play is a direct result of an upgrade at Wanda. Wang Jianlin has long indicated that the answer would be revealed on this day.

其实,细心的人早就能发现这次合作的蛛丝马迹。它与万达正在进行的业态升级紧密关联。甚至可以说,苏宁的入局,正是万达进行业态升级的直接成果。王健林一直引而不发,直到这一天揭晓答案。

The adjustments had been watched by many skeptical observers for about half a year, without Wang Jianlin providing much of a response during all the time, according to CNS. But as for Wanda’s department stores, or plazas, CNS has reassuring news:

Are Wanda’s stores really as bad as comments from outside suggest? Not at all. One one occasion, in an internal meeting, Wang Jianlin revealed that nearly half of the Wanda stores were incurring losses, but that the other half of them were profitable. He was in a position to cut the outlets that were incurring heavy losses, optimize the portfolio, and then have a attractive story to tell to the Hong Kong capital markets, with a beautiful financial report.

万达百货真的有外界评说的那么糟糕吗?并不是。王健林曾经在一次内部会上透露,万达百货有近一半是亏损的,但还有另一半是盈利的。他完全可以砍掉亏损严重的门店,优化资产组合,用亮丽的财报去给香港资本市场讲一个动听的故事。

The CNS article also points out that Wanda became involved in the culture industry in 2012.

Compared with real estate business, the contribution the culture segment could make to [the Wanda group’s] revenues and profits was very low, but it perfectly fitted into the strategic requirements of the national advancement of soft power, and its synergy effects with real estate, tourism, and other trades was obvious. As big onlooking companies  from the real estate began to recognize [Wanda’s approach], they scrambled to emulate it.

2012年,万达发力文化产业。跟地产比起来,文化产业能够贡献的收入和利润份额在当时非常之低,但是却紧密契合了国家提升软实力的战略需求,与地产、旅游等行业的协同效应非常明显。以至于在后来,许多大型地产企业都看明白了,开始争相效仿。

CNS also refers to the acquisistion of AMC Theatres (AMC Cinemas), and Infront Sports and Media, and offers an explanation as to why such acquisitions would make sense, and concludes:

There are many more such examples. Every draw in this game of chess was made not from a spur of the moment, but as a move taken after careful consideration, serving the transformation plan for the entire Wanda group. This is also true for the adjustments of the stores, and the introduction of Suning.

这样的例子还有很多。万达的每一步棋子都不是临时起意,都是深思熟虑之后的谨慎之举,并为整个集团公司的转型大计服务。调整百货,引入苏宁,也是如此。

The message provided by CCTV’s website for the foreign audience is equally heartwarming:

The Wanda Group, headed by Asia’s richest man Wang Jianlin, seems unstoppable.

Complementary illustration ...

Complementary illustration …

The Financial Times, in an online article published on August 6, isn’t quite that enthusiastic – although, it should be said, their misgivings aren’t about the Wanda-Suning romance which was only made public in September, but about the O2O industry in general. Rising labor costs could hamper the business model, and it is not entirely clear what lasting new business models will emerge.

That said, if O2O is really a lifestyle, as suggested by Chinaskinny, the question might come up, sooner or later, if and how costs play a role in that customer “hobby”, and if the promises it makes to the supplier side are sustainable, For sure, the example of the nail specialists who can make so much more per hour, if based on O2O, is all over the internet, as observed by the FT.

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Related

» Baidu Q3 forecast, TechCrunch, July 27, 2015
» Traditional Industries, new Bones, April 17, 2015
» Central Committee Cultural Decision, Oct 28, 2011

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