Tuesday 31 August 2010

NORTH KOREA AND CHINA

Reuters

ANALYSIS: NORTH KOREA'S "FAMILY FIRM" SIDLES UP TO CHINA

Chris Buckley

Reuters, August 31, 2010

Think of North Korea's Kim Jong-il as the autocratic, ailing boss of a family firm -- sanctioned, cash-strapped, and worried about who will take over -- and his weekend tour to woo main backer China makes sense.

Kim's visit to China was, as usual, cloaked in secrecy until it ended on Monday. But even the opaque official reports made clear enough that the shuffling 68-year-old leader wanted to reassure China, whose economic help and diplomatic muscle he needs as much as ever to support a dynastic succession.

The reclusive leader told President Hu Jintao he was willing to return to nuclear disarmament talks -- which China wants -- and praised China's economic success. In return, Hu welcomed Kim's position on the nuclear talks and nudged him on economic reform.

"Economic development should be self-reliant and also cannot be separated from opening up and cooperation," Hu told Kim, according to the state-run Xinhua News Agency.

(...) [artículo aquí]

Monday 30 August 2010

CHINESE LABOR

The Japan Times

CHINESE LABOR STRIFE FRAMES LARGER FIGHT OVER IDEOLOGY

Sentaku Magazine

The Japan Times, August 30, 2010

Since May, a number of factories in China have been hit by strikes and other forms of labor disputes, and an end seems to be nowhere in sight. Most of the plants targeted by the strikers are subsidiaries of overseas corporations. Especially hard hit have been the subsidiaries of Japanese companies, including two automakers — Toyota and Honda.

Law enforcement authorities are no longer suppressing the strikers as they did in the past at the request of management. Instead, they are taking a wait-and-see attitude, apparently because the general public overwhelmingly supports the workers' demands for pay hikes and because the central government appears to have given tacit approval of the strikes.

Not only have these labor disputes played havoc with major manufacturing facilities in many parts of the country, they have also brought to the fore a serious dispute within the Chinese Communist Party as to how to reconcile workers' demands for higher wages with the need to maintain high economic growth — before the party's 18th National Congress convenes within two years.

(...) [artículo aquí]

Sunday 29 August 2010

ASIA’S CONCERNS

ap_logo

ASIA ASSESSES PROSPECTS AS WORLD RECOVERY STUMBLES

Kelly Olsen

Associated Press, August 29, 2010

SEOUL, South Korea — Talk of the global economic recovery fizzling doesn't faze Cho Byung-cheol, president of a small South Korean technology company that has already set up a branch in China and plans one soon in the United States.

The company, which designs and makes semiconductor-based high-speed data storage and processing equipment, is planning to boost its South Korean workforce of nearly 60 by half, says Cho, who founded Seoul-based Taejin Infotech Co. in 1996. Sales, which totaled only 8.4 billion won ($7 million) last year, could swell fourfold this year and reach 100 billion won next year, he predicts.

Sitting in his spacious, well-ordered office, Cho's confidence belies the grim mood that has settled over global stock markets in the past month as indicators from the U.S. to Japan show the economic rebound is running out of juice.

Asia's big corporate names from Toyota to Singapore Airlines to Samsung Electronics have ridden a wave of recovery from the world's worst downturn in decades as emerging powerhouses China and India spruced demand with massive injections of government stimulus.

(...) [artículo aquí]

Saturday 28 August 2010

A NEW STRATEGY WITH NORTH KOREA?

afp_logo

US CONSIDERS FRESH APPROACH TO N. KOREA: REPORT

AFP, August 28, 2010

WASHINGTON — The United States, looking for a diplomatic breakthrough on the Korean Peninsula, has begun weighing a fresh effort at engagement with the government of North Korea, The New York Times reported.

Citing unnamed officials and analysts, the newspaper said a new overture to Pyongyang would be preceded by additional pressure tactics.

But it suggests that the administration of President Barack Obama has concluded that pressure alone will not be enough to move North Korea’s dictator, Kim Jong-il.

Secretary of State Hillary Clinton solicited ideas from outside experts and former officials about the next steps in policy toward North Korea at a high-level meeting last week, the report said.

The consensus, even among the hawks, was that the United States needed to resume some form of contact with Kim, the paper said.

Clinton expressed impatience with the current policy, which is based on ever more stringent economic sanctions and joint US-South Korean naval exercises, which have been launched in response to the sinking in March of a South Korean warship, for which South Korea blamed the North, The Times said.

(...) [artículo aquí]

Friday 27 August 2010

Mr. KIM GOES TO CHINA

The Korea Herald

KIM’S CHINA VISIT

The Korea Herald, August 27, 2010

North Korean leader Kim Jong-il is visiting China, possibly with his third son and heir apparent, Kim Jong-un. On Thursday, he reportedly visited a middle school in Jilin in northeastern China that his late father, Kim Il-sung, attended. On Friday, he moved to Changchun, an industrial city about an hour’s drive from Jilin. Little else is known about the reclusive leader’s unexpected trip to China.

Kim’s visit is puzzling as it comes just three months after he made an unofficial visit to Beijing from May 3 to 7, the first time in four years. All the more so given the arrival in Pyongyang of Jimmy Carter on the eve of his abrupt midnight departure to China. What is it that is more important for the North Korean leader than to meet the former U.S. president whom he invited to discuss the release of an American jailed in the North – and probably the resumption of the stalled six-party talks on the North’s nuclear programs?

Many North Korea analysts in Seoul suggest Kim’s visit most likely has to do with his plan to hand over power to his handpicked successor, Jong-un. They point to the Workers’ Party Representatives Meeting which is to be convened early next month for the first time in 44 years. Jong-un is widely expected to be appointed to a key party position at the meeting.

(...) [artículo aquí]

Thursday 26 August 2010

CHINA AS No. 1?

Chosun Ilbo

CAN CHINA OVERTAKE U.S. AS WORLD'S NO. 1 ECONOMY?

The Chosun Ilbo, August 26, 2010

After the news that China has pulled ahead of Japan to become the world's second largest economy, experts are now speculating on when it might dethrone the U.S. to take the No. 1 spot. Nomura Securities forecasts China could achieve the feat in less than a decade. Nobel Prize-winning economist Robert Fogel of the University of Chicago predicts that China will account for 40 percent of the world's GDP by 2050, and the U.S. a meager 14 percent.

But other experts say fears of Chinese hegemony are exaggerated as the country's rapid economic growth will soon hit its limits. Forbes magazine issued a report on Tuesday that looks at "five reasons why the U.S. can stay ahead of the Middle Kingdom."

First on the list is water. "If water is the 'new oil,' China faces a thirsty future," Forbes wrote. According to Steve Solomon, author of "Water: The Epic Struggle for Wealth, Power and Civilization," China has about one-fifth per capita the amount of freshwater reserves as the U.S., and much of its supply is polluted. While water usage in the U.S. has become more efficient, China faces growing demands from businesses, farms and its burgeoning population.

(...) [artículo aquí]

Wednesday 25 August 2010

INDIA’S GROWTH

International Business Times

INDIA ACHIEVES HIGH GDP GROWTH AFTER GLOBAL CRISIS, INFLATION WORRIES: RBI

Siddharthan Meganathan

International Business Times, August 25, 2010

The Indian economy exhibited broad based recovery in the second half of 2009-10 from the slowdown that had started in the second half of 2008-09. Despite deficient monsoon and the fragile global recovery, India achieved 7.4 percent growth in GDP in 2009-10, one of the highest in the world. The focus of macroeconomic policies was on management of the recovery, according to the latest annual report of the Reserve Bank of India (RBI).

A strong recovery in industrial sector combined with a resilient services sector muted the impact of a deficient South-West monsoon on overall output. The contribution of the industrial sector to the overall growth increased sharply from 9.5 percent in 2008-09 to 28 percent in 2009-10.

The services sector witnessed growth moderation from 9.3 percent in 2008-09 to 8.3 percent in 2009-10, essentially due to the “community, social and personal services” on partial withdrawal of fiscal stimulus and the base effect attributed to large disbursements of arrears under the Sixth Pay Commission award in 2008-09.

(...) [artículo aquí]

Tuesday 24 August 2010

CARS IN BEIJING

China Real Time Report

BEIJING: WORLD’S BIGGEST PARKING LOT

China RealTime Report, August 24, 2010

China’s love affair with cars seems increasingly to be turning its capital into a giant, nightmarish, gridlocked parking lot. (See a slideshow.)

Following news of a 10-day traffic jam outside Beijing that has stretched up to 100 kilometers (62 miles) long, state media on Tuesday reported that average driving speeds in the capital could drop below 15 kilometers an hour if residents keep on buying at current rates of 2,000 new cars a day. At that pace, Beijing will have 7 million vehicles by 2015, according to the head of the Beijing Transportation Research Center, and the pace of movement will slow to what it was a decade or more ago when China was still the Bicycle Kingdom.

The problem is that Beijing’s roads only have enough capacity to handle 6.7 million vehicles — and that’s assuming current restrictions stay in place, such as the one requiring private cars to keep off the road for one day a week.

The results of too many tires on too little road are a daily commuter crush that’s among the worst in the world, comparable to New Delhi or Moscow and five times worse than America’s capital of road rage, Los Angeles, according to a recent IBM study.

(...) [artículo aquí]

Monday 23 August 2010

CHINA’S EMPTY BUILDINGS

China Briefing

IS CHINA GROWING TOO BIG?

Chris Devonshire-Ellis

China Briefing, August 23, 2010

For many years now, as I’ve traveled China on business, I’ve been skeptical of the GDP growth figures. From Shenzhen to Changchun and from Wuhan to Kashgar, via Chongqing, buildings have been going up, rather like mushrooms after a rain storm, as signs of the new prosperity and growth of China.

In fact, every single Chinese city, large and small, seems to have acres of new developments – but all lying empty. The giveaway is a quick evening tour of residential and business blocks. If no lights are on, why were they built? Entire development zones with no businesses. Blocks upon blocks of high rise apartments for tens of thousands of families – all unused, empty shells instead of the dream homes the advertising hoardings proclaim they are.

Local governments and real estate developers have been working together to “improve the value of the land,” and reap income and gain growth credits for doing so, but how is the land improved if no-one is using it? In fact, land in which money has been spent to build a block of high-rises may show an increase in value on paper, but until those units are sold or rented out they have been erected at a loss. Value of land is a key indicator in China’s GDP growth figures, yet if no one is utilizing it, obviously those figures are wrong. Traveling from the airport to downtown Chongqing for example, there are masses of expensive, premium apartments and villas for sale. Chongqing’s minimum wage level is US$1,221 per annum. But priced at US$1 million each, who is going to buy them? Adding value to land only works if you have a market for the property, otherwise the valuation is just a paper exercise representing no real financial asset or gain.

(...) [artículo aquí]

Sunday 22 August 2010

CHINA’S RISE AND INDIA

Economic Times logo

CHINA RISE: SHOULD INDIA WORRY ABOUT BEING SWALLOWED WHOLE?

The Economic Times, August 22, 2010

BEIJING: China is growing so fast it creates some sort of world record every week. With 1.4 billion people, China has more mobile phones than any other country. It has more high-speed rail lines and wind power.

It has more Internet users. It is also the world’s biggest importer of minerals. It has already dislodged Germany from pole position as the world’s number one exporter. Just a few weeks ago, China became the world's biggest guzzler of energy, though it accepted this particular position with great reluctance.

So, when China overtook Japan as the world’s second biggest economy earlier this week and placed itself right behind the US, the news was hardly a surprise — both at home and abroad. China’s official media showed no signs of jubilation .

Even in Japan, the leading English daily , The Japan Times, paid little attention and did not rush to write an editorial. It merely published a London-based writer’s commentary on China’s phenomenal rise.

But it was a significant milestone. For 43 years, Japan had been second only to the US in economic might. Now, some experts say the Chinese economy will outstrip the US in a decade if both countries continue at their existing rate of GDP growth — 10% for China and 3% for US. Perhaps.

Whatever happens, the possibility that China will be the world’s number one economy is already creating a buzz — and jitters — everywhere .

(...) [artículo aquí]

Saturday 21 August 2010

THE CHINESE ERA

The Star - Toronto CHINA’S UNFINISHED ECONOMIC REVOLUTION

David Olive

Toronto Star, August 21, 2010

This week’s revelation that China has overtaken Japan as the world’s second-largest economy was anti-climatic. With China growing at about 10 per cent a year for the past 30 years or so, and Japan entering its third decade of stagnant growth, the change in status quo has been long expected.

Still, the milestone sparked predictable hand-wringing in many quarters. Will it be 20 or just 10 years before the Middle Kingdom also surpasses the U.S. in size? Will Beijing eclipse Washington as the corporate colonizer of Latin America, the Middle East, Indonesia and other less-developed nations?

“While the 19th was the European century and the 20th the American century, the world seems to have entered what may become known as the Chinese era,” says Jean-Pierre Lehmann, professor of international political economy at IMD, the distinguished Swiss business school.

But one has to be careful in forecasting superpower status. In the 19th century, it seemed that Russia, Brazil and Argentina were poised for economic greatness. Impressed with Canada’s rapid growth that century, Benjamin Disraeli predicted Canada’s emergence as “the new Russia.”

(...) [artículo aquí]

Friday 20 August 2010


INDIA OR CHINA: RAGHAV BAHL AND YASHENG HUANG SPEAK THEIR MIND
Miracle nations. Economic powerhouses. But can they become collaborators? Two views...

Forbes India, August 20, 2010

Raghav Bahl is the founder of Network18, a media conglomerate that owns CNBC-TV18, CNBC Awaaz, CNN-IBN, In.com, Moneycontrol and Forbes India. He is one of the pioneers of television journalism in India. Bahl’s book Superpower?: The Amazing Race Between China’s Hare and India’s Tortoise has been recently published by Penguin Allen Lane.

China and India lived together as peaceful, populous and prosperous neighbours until the 18th Century. Then colonial powers took control and enervated their prosperity. In 1914, the British drew the McMahon Line and ruptured their peace. China believes nearly 150,000 sq km of its territory was fraudulently transferred to India. Both countries went to war in 1962; a militarily under-prepared India was thrashed, opening up deep psychological scars which have not been repaired to this day. Then both got absorbed in fixing their damaged economies; China dazzled the world with its $5 trillion prowess, and India attracted attention with its $1.25 trillion play. Today, the world’s fastest and second fastest growing economies are locked in an uneasy clasp.

(...) [artículo aquí]

Thursday 19 August 2010

CHINA THREAT?

Asia Times

CHINA THREAT: NOW YOU SEE IT, NOW YOU DON'T

David Isenberg

Asia Times, August 19, 2010

It's that time of year again; the time when the Pentagon rolls out its annual threat assessment on China. The Pentagon has been issuing these reports since 2000, pursuant to US law. This year the 74-page "2010 Annual Report to Congress on Military and Security Developments Involving the People's Republic of China" [1] will undoubtedly be a disappointment to those conservatives who are looking to depict China as a menacing strategic competitor to the United States.

While the executive summary includes the usual warnings about China's pursuit of new military capabilities, it also pointedly notes that "[E]arlier this decade, China began a new phase of military development by articulating roles and missions for the People's Liberation Army (PLA) that go beyond China's immediate territorial interests.

"Some of these missions and associated capabilities have allowed the PLA to contribute to international peacekeeping efforts, humanitarian assistance and disaster relief, and counter-piracy operations. The United States recognizes and welcomes these contributions," the report notes.

(...) [artículo aquí]

Wednesday 18 August 2010

RMB APPRECIATION

Morgan Stanley

CHINA: RENMINBI ON SUMMER BREAK

Qing Wang

Morgan Stanley Global Forum, August 18, 2010

Since it exited from its peg against the USD on June 20, the RMB has appreciated against the USD rather fast, by about 0.8% in the first 10 trading days through July 2 (see China Economics: Renminbi Exits from USD Peg and Returns to Pre-Crisis Arrangement, June 20, 2010). However, the exchange rate has since been broadly stable at around 6.77, while most other EM currencies have registered more meaningful appreciation against the USD.

Authorities' Educational Campaign

The Chinese authorities recently launched an education campaign articulating the virtues of, and their commitment to, a flexible exchange rate arrangement in the form of five consecutive articles published under the name of PBoC Deputy Governor Hu Xiaolian (see Appendix in the full report for the five articles).

(…) [artículo aquí]

Tuesday 17 August 2010

DOD REPORT ON CHINA

WashPost

ECONOMIC POWERHOUSE CHINA FOCUSES ON ITS MILITARY MIGHT

John Pomfret

The Washington Post, August 17, 2010

China is quickly modernizing its military and has set its sights on extending its influence deep into the Pacific and Indian oceans now that the military balance with its longtime nemesis, Taiwan, is tilting in its favor, the Defense Department reported Monday.

In its annual report to Congress on China's military, the Defense Department said that the People's Liberation Army is advancing across the board commensurate with China's burgeoning economic power. Coincidentally, the report was issued a day after China's economy was recognized as the world's second biggest, eclipsing Japan's in size during the second quarter of this year.

The report listed numerous areas in which China's military is on the march. China is deploying a new class of nuclear-powered submarines equipped with intercontinental ballistic missiles. It is pouring money into space warfare systems and cyberwarfare capabilities. It is developing a "carrier killer" anti-ship ballistic missile.

China has "the most active land-based ballistic and cruise missile program in the world," the report said. Beijing "now possesses one of the largest" forces of surface-to-air missiles in the world, it added. And it has the "largest force of principal combatants, submarines, and amphibious warfare ships in Asia."

(...) [artículo aquí]

Monday 16 August 2010

CHINA AS No. 2

Bloomberg

CHINA OVERTAKES JAPAN AS WORLD'S SECOND-BIGGEST ECONOMY

Bloomberg News, August 16, 2010

China surpassed Japan as the world’s second-largest economy last quarter, capping the nation’s three- decade rise from Communist isolation to emerging superpower.

Japan’s nominal gross domestic product for the second quarter totaled $1.288 trillion, less than China’s $1.337 trillion, the Japanese Cabinet Office said today. Japan remained bigger in the first half of 2010, the government agency said.

China led the world out of last year’s global recession with an economy that’s more than 90-times bigger than when leader Deng Xiaoping ditched hard-line Communist policies in favor of free-market reforms in 1978. The country of 1.3 billion people will overtake the U.S., where annual GDP is about $14 trillion, as the world’s largest economy by 2027, according to Goldman Sachs Group Inc. chief economist Jim O’Neill.

China’s surpassing of Japan “is a marker of its increasingly dominant role in the global economy,” said Eswar Prasad, a senior fellow at the Brookings Institution and former head of the China division at the International Monetary Fund. “The resilience of China’s growth during the crisis enabled a number of other countries, particularly commodity-exporting economies, to ride on its coattails.”

(...) [artículo aquí]

Sunday 15 August 2010

CHINA AND CLEAN TECHNOLOGY

Seeking Alpha

CHINA HAS ALREADY SURPASSED THE U.S IN CLEANTECH

Dallas Kachan

Seeking Alpha, August 15, 2010

It's been fashionable to debate whether China will some day surpass the U.S. in clean technology. Yet, after reviewing some of the metrics that really matter, one could conclude that it already has. At least this was my thesis in moderating a recent Haas School of Business event at U.C. Berkeley in California that explored whether China would become a green economy leader.

China has already surpassed the U.S., I argued (as reported elsewhere), and pointed to the following:

IPOs: According to data we collected at the Cleantech Group, in 2009 (the last full year for which data was available as of this writing), China accounted for almost three quarters of all cleantech IPO proceeds worldwide, well ahead of the U.S., which had only 26%; and to date in 2010, the top three cleantech IPOs of the year have all been Chinese companies.

M&As: The top region for cleantech M&A activity in 2009 was Asia (35% of total), followed by Europe (31%) and North America (26%), according to our same research above.

(...) [artículo aquí]

Saturday 14 August 2010

CHINA’S ENVIRONMENTAL CRISIS

Asia Times

GREENING OF CHINA AN AFFAIR OF STATE

Benjamin A Shobert

Asia Times, August 14, 2010

It would be reasonable to assume that recent hearings on Washington's Capitol Hill concerning China's "Green Energy and Environmental Policies" would have been a touch dry, perhaps not framed by the same sense of urgency and division than more recent skirmishes over currency policy or World Trade Organization compliance.

But the most recent hearing by the US China Economic and Security Review Commission (USCC) on this topic brought forward several points that seem critical to understanding how China and the US are both coming to terms with what each must do to reposition its national economy and secure a future for its people.

China's environmental policies have long been the subject of much frustration and fear. Experts such as Elizabeth Economy, now at the Council on Foreign Relations as a senior fellow and director for Asian Studies, wrote in her seminal book The River Runs Black:

The roots of China's current environmental crisis run deep. Through the centuries, the relentless drive of China's leaders to amass power, consolidate territory, develop the economy and support a burgeoning population led to the plundering of forests and mineral resources, poorly conceived river diversion and water management projects, and intensive farming that degraded the land.

(...) [artículo aquí]

Friday 13 August 2010

CHINA AND NORTH KOREA

Yonhap

U.S. SCHOLARS URGE CHINA TO BE MORE RESPONSIBLE IN POST-CHEONAN DIPLOMACY

Yoo Jee-ho

Yonhap News, August 13, 2010

China should take a more responsible role in maintaining regional security and stop trying to protect North Korea after a South Korean warship went down earlier this year following an apparent North Korean attack, U.S. scholars said at a forum in Seoul Friday.

"When it comes to dealing with North Korea, Washington (And I would argue Seoul even more so) increasingly sees China as part of the problem rather than part of the solution," said Ralph Cossa, head of the Hawaii-based Pacific Forum of the Center for Strategic and International Studies (CSIS).

Cossa was among academics attending a symposium hosted by the Asan Institute for Policy Studies, an independent think tank here. Participants discussed the aftermath of the sinking of the South Korean ship Cheonan on March 26, and what should be done to achieve peace and security in Northeast Asia.

(...) [artículo aquí]

Thursday 12 August 2010

FLOODS IN PAKISTAN

BBC

PAKISTAN FLOODS CAUSE 'HUGE LOSSES' TO CROPS

BBC News, August 12, 2010

Pakistan's floods have caused "huge losses" to its crops, the country's food minister has told the BBC.

Nazar Muhammad Gondal said significant amounts of the grain, sugarcane and rice harvests had been washed away.

Meanwhile a senior religious scholar has said that flood victims living in difficult conditions should not have to fast over the Muslim Ramadan period.

And Pakistan's UK envoy has denied that most of the money given for flood defences has been lost to corruption.

High Commissioner to London Wajid Hasan dismissed the allegation by pressure group Transparency International, and insisted his government was doing all it could to help people in need.

Floodwater triggered by heavy monsoon rains is still surging south along the Indus River, forcing people from their homes.

Food Minister Gondal said grain stocks had been destroyed in Khyber Pakhtunkhwa (formerly North West Frontier) province, but some remained in southern Punjab province.

(...) [artículo aquí]

Wednesday 11 August 2010

CHINA’S SLOWDOWN

Business Spectator A SOFT LANDING FOR CHINA

Craig James

Business Spectator, August 11, 2010

Chinese economy remains strong, but slowing as predicted. Chinese authorities have reason to be satisfied with their efforts to slow the economy to a more sustainable rate. Latest economic data largely printed in line with consensus estimates in July.

Industrial production continues to barrel along at a 13.4 per cent annual rate with retail spending up 17.9 per cent on a year ago. Non-food inflation stands at just 1.6 per cent.

What does it all mean?

It’s not easy to engineer a soft landing, but the Chinese authorities must be delighted with their efforts. While the Chinese economy is easing to a more sustainable rate, it is clearly in the realm of a slowdown, not a shutdown. When you have production, investment and retail spending all barrelling along at double-digit annual rates, it is clear that the economy remains in pretty strong shape.

(...) [artículo aquí]