Friday 30 November 2012

INDIA: 5.3% IN JULY-SEPTEMBER

Reuters DEF

EXPERT VIEWS: INDIA’S ECONOMY GROWS 5.3 PERCENT IN SEPTEMBER QUARTER

Reuters, November 30, 2012

MUMBAI (Reuters) - India's economy grew at a lower-than-expected 5.3 percent in the quarter ending in September, against an analysts' forecast of 5.4 percent, government data showed on Friday.

The manufacturing sector grew an annual 0.8 percent during the quarter while farm output rose 1.2 percent, the data showed. In the quarter ending in June economic growth was at 5.5 percent.

Asia's third largest economy is still growing faster than many other major economies, but it has slowed from 6.5 percent in the 2011/12 fiscal year and 8.4 percent in the previous two fiscal years.

COMMENTARY

RAJEEV MALIK, SENIOR ECONOMIST, CLSA, SINGAPORE

"The GDP data are pretty much in line with expectation and we expect the December quarter GDP to be in the 5.0-5.5 percent range as well, before improving in the March quarter.

"There is a low-level stabilisation in the economic activity taking place. The GDP data do not alter our full-year 2012/13 GDP growth forecast of 5.5 percent, improving slightly to 6 percent in 2013/14.

"The government only woke up at the end of September, and this GDP data do not capture the impact of that change. There will be a time lag as financial markets discount the likely real economy impact."

(...) [article here]

Thursday 29 November 2012

INDIA’S 5.5 PERCENT

Money Control

WHY INDIA STRUGGLES TO DELIVER ITS GROWTH POTENTIAL

India is going to deliver its third quarter growth numbers on Friday and expectations are running low as Asia`s third largest economy has had a disappointing year so far, with gross domestic product (GDP) growth languishing around 5.5 percent.

CNBC-MoneyControl, November 29, 2012

The world`s largest democracy, which boasts of a burgeoning domestic market coupled with a youthful population, has seen much better days - just two years ago it was growing at a robust 8-plus percent.

But today it`s faced with the prospect of being the first BRIC (Brazil, Russia, India, China) nation to have its credit ratings cut to junk as investors begin to lose faith in India`s growth story.

(Read more: Does IMF's Dismal India Forecast Signal a Hard Landing?)

Uncertainty surrounding government policies - despite recent reforms to attract foreign investment - a ballooning deficit, sky-high inflation and a currency that has slumped over the last year, have all added to India`s growth woes eroding investor confidence, said experts.

"The key factor that has led to the deceleration in GDP growth from above 8 percent levels to the last quarterly print of 5.5 percent is a near collapse in investments," Rohini Malkani, economist at Citi, wrote in a report.

Growth in capital formation, or the transfer of savings from households and the government to businesses, has fallen from double-digits in the 2005 fiscal year to single-digits in 2011, according to Citi data.

(...) [artículo aquí]

Wednesday 28 November 2012

CHINA’S GROWTH IN 2012

Economic Times logo OK

CHINA CERTAIN TO HIT 7.5 PCT 2012 GDP GROWTH TARGET: COMMERCE MINISTER

Reuters

The Economic Times, November 28, 2012

BEIJING: China is certain to hit the government's economic growth target of 7.5 percent for 2012 and could even exceed it, Commerce Minister Chen Deming said on Wednesday.

Chen made the comment at a conference, adding that China would likely spend more than $70 billion this year on non-financial outbound direct investment.

"In the first three quarters, China's economy has grown 7.7 percent from a year ago, therefore, it is for certain that we can achieve the annual GDP target of 7.5 per cent or above, " Chen said in a speech.

The minister's remarks on growth echo those made by an official from the National Bureau of Statistics in October when economic data for the third quarter revealed annual growth had dipped to 7.4 per cent.

China's growth rate has slowed for seven successive quarters and is on course for its weakest full year of expansion since 1999, albeit at a pace that far outstrips the rest of the world's major economies. Analysts polled by Reuters expect China, the world's second biggest economy, to grow by 7.7 per cent in 2012.

(...) [article here]

Tuesday 27 November 2012

THE PATH TO CONSUMPTION IN CHINA

Shanghai Daily

CHINA NEEDS MORE REFORMS TO MAKE A CONSUMPTION-DRIVEN ECONOMY

Jonathan Woetzel, Lillian Li and William Cheng

Shanghai Daily, November 27, 2012

CHINA'S economy is starting to shift to a more consumption-driven and service-driven model that should help to sustain the country's growth, albeit at a slower rate, over the next decade and beyond.

Over the past two decades, the growth in China's GDP has been largely powered by investment by government and the corporate sector - primarily state-owned enterprises that retained or reinvested their relatively high returns on investment.

Investment has increased at such a fast rate that although household income has risen consistently over the period since 1990, as a percentage of GDP, it has fallen from 70 percent in 1990 to 57 percent in 2011. However, our projections suggest that within the next five years, the household income share of GDP will start to rebound.

Three drivers
We see three drivers for this acceleration in household income growth.

First, wages are likely to rise due to government policies and structural changes in the labor market. Policy makers have set a clear target that per capita disposable income should rise at least as fast as GDP in the 12th Five-Year Plan. The main steps are focused on increasing minimum wages and the reference wage.

Supply and demand dynamics are pushing in the same direction as government policy. China's labor pool is shrinking due to demographics and a reduced flow of migrant labor from rural areas, and this is exerting upward pressure on wages.

(...) [article here]

Monday 26 November 2012

CHINA’S AND INDIA´S SLOWDOWN

Economic Times logo OK

WHY GROWTH IN INDIA SLOWED MORE THAN CHINA

Alok Sheel

The Economic Times, November 26, 2012

India was, till recently, the second-fastest growing major economy after China. Following the sustained slowdown in the global economy since the financial crisis of 2007, growth has fallen across the board, including in China and India (see accompanying table).

It was expected that China would be more affected, given its dependence on export markets for growth. For the same reason, it was expected that India, a more domestically driven economy, would be less affected — in 2009, goods and services exports comprised 40% of GDP in China, against 20% in India.

Although, in 2010, it may have seemed that this was indeed the case, in retrospect, the reverse seems to have happened, i.e, India has slowed more than China. As a result, Indonesia, which like India, is a more domestically-driven economy — goods and services exports at 24% of GDP in 2009 — has now replaced India as the second-fastest growing major economy. We need to understand why this is the case so that corrective steps can be taken.

While China experienced a huge external shock through the trading channel on account of the sharp decline in growth in its export markets in western countries, the impact on growth was not commensurate on account of its huge investment-oriented stimulus package. India too had a timely 'fiscal stimulus' — mostly by default than design — although not as large as that of China.

While the final budgetary stimulus in 2008-09 was almost identical in both countries at about 3% of GDP, the actual Chinese stimulus through budgetary and banking channels may have been in the region of 4 trillion yuan, or about 14% of GDP. However, since private investment and consumption demand held up reasonably well in India, its recovery matched that of China.

(...) [article here]

Sunday 25 November 2012

CHINA’S MISSING RULE OF LAW

The Washington Post

BEYOND THE LAW IN CHINA

Editorial Board

The Washington Post, November 25, 2012

THE LEADERS of China talk about corruption as if it were merely a failure of party discipline. The new general secretary of the Chinese Communist Party, Xi Jinping, became the latest to suggest this in a speech delivered just after his rise to the top post on Nov. 17. “We must be vigilant,” Mr. Xi declared, warning that corruption threatens to corrode both the party and state.

He’s right about the threat. Corruption is rife in Chinese government, business and society, blossoming along with China’s remarkable economic growth. But Mr. Xi’s admonition will do nothing to stop corruption, and the reasons are not hard to find. China possesses a semblance of a legal system, with courts, lawyers and trials. But it has yet to create a genuine rule of law. The definition of rule of law is that no one — not even the party’s elite — is above the law. Yet in China today, the party stands beyond. It often uses the law to punish those who challenge its monopoly on power.

Two recent examples illuminate the party’s exalted position. The first was the downfall of Chongqing party chieftain Bo Xilai, a rising figure in the elite until it was revealed that his wife was involved in a murder scandal surrounding the death of a British businessman. Mr. Bo’s abuses shocked many Chinese when they were revealed, and served to underscore how the system works, enriching and protecting those in power. Mr. Bo lost his footing, but he was the exception rather than the rule. Mr. Xi seemed to acknowledge this in his speech, saying, “In recent years, there have been grave violations of disciplinary rules and laws within the party that have been extremely malign in nature and utterly destructive politically, shocking people to the core.”

(...) [article here]

Saturday 24 November 2012

THE US AND ASIA

The Japan Times

MR. OBAMA'S FOCUS ON ASIA

The Japan Times, November 24, 2012

U.S. President Barack Obama has concluded a three-country Southeast Asia tour designed to punctuate his administration's intention to focus on Asia. The intentions are good and the strategy is correct: Asia deserves a more prominent place in U.S. thinking and planning.

But the realities of governing conspired to overshadow Mr. Obama's intent: A crisis in the Gaza Strip and the prospect of a fiscal crisis in the United States distracted the president from his pledge to focus more attention on Asia.

Mr. Obama visited Thailand, Myanmar and Cambodia on his first trip after winning re-election.

In Bangkok, he strengthened his country's alliance with Thailand, and Prime Minister Yingluck Shinawatra said her country was prepared to begin negotiations on joining the Trans-Pacific Partnership trade agreement.

In a gesture that meant much to the country's residents, Mr. Obama visited Thailand's ailing 84-year-old king in the hospital.

From there Mr. Obama went to Myanmar, marking the first visit ever by a U.S. president to that country. He met President Thein Sein and encouraged him to continue his country's efforts toward political and economic reform.

Mr. Obama announced a new mission from the U.S. Agency for International Development and pledged a two-year aid package worth $170 million.

[article here]

Friday 23 November 2012

MYANMAR, THE US, AND CHINA

The China Post

US-MYANMAR TIES FORCE CHINA RETHINK

Didier Lauras, AFP

The China Post, November 23, 2012

BANGKOK -- After years of almost unchallenged dominance, China's influence in Myanmar is under threat as the United States and other nations seek closer ties with the former pariah state, experts say.

The Asian economic powerhouse has long helped keep Myanmar afloat through trade ties, arms sales, and by shielding it from U.N. sanctions over rights abuses as a veto-wielding, permanent member of the Security Council.

In return, China was assured of a stable neighbor and access to Myanmar's oil, gas and other natural resources.

But since Myanmar's military ceded power last year, China has lost some of its leverage over the country formerly known as Burma.

European and U.S. firms are no longer banned from doing business there, leaving them scrambling to catch up with rivals from China, India and elsewhere in Asia in the competition for its resources and consumer markets.

U.S. President Barack Obama's historic visit to Yangon this week was the clearest indication yet of the sea change in relations under way between Washington and Myanmar.

(...) [article here]

Thursday 22 November 2012

ASEAN SUMMITS

asiaone_logo

INTENSE BUT FRUITFUL ASEAN SUMMIT

Asean summits have always had a punishing schedule for those participating in the meetings

Mergawati Zulfakar (The Star/Asia News Network)

AsiaOne, November 22, 2012

PHNOM PENH - As he got up after his press conference with the Malaysian media before departing home from Phnom Penh, Datuk Seri Najib Tun Razak candidly exclaimed: "Wah! Exhausted! If anyone thinks that this is a joy ride, you better tell the people at home.

"Pagi sampai malam tiga hari berturut turut, tak berhenti langsung! (From morning to night for three days in a row. Non-stop)".

He quipped, still looking dapper despite going through another long day of meetings with Asean and world leaders, including from China, India, the United States and Japan.

Asean summits have always had a punishing schedule for those participating in the meetings.

Meetings always overrun the scheduled time, causing a pyramid effect on other meetings.

But as a seasoned Asean summit attendee from Malaysia puts it, "Asean meetings will always be important as the cornerstone of a country's foreign policy".

Asean meetings can be slow affairs but can get fairly "exciting" when there is a crisis brewing be it political or foreign affairs.

It was no different at this 21st Asean Summit and Related Summits at the Cambodian capital this week where overlapping territorial claims among several of the participating countries and the attacks by Israel against the Palestinians grabbed the headlines.

(...) [article here]

Wednesday 21 November 2012

RECESSION IN JAPAN

Bloomberg_logo

JAPAN’S EXPORTS REACH THREE-YEAR LOW AS RECESSION LOOMS: ECONOMY

Andy Sharp and James Mayger

Bloomberg, November 21, 2012

Japan is suffering its worst year for exports since the global contraction in 2009 as Europe’s crisis, China’s slowdown and a diplomatic dispute with the Chinese hurt manufacturers and deepen the risk of a recession.

Shipments totaled 53.5 trillion yen ($653 billion) for January through October, down 2.3 percent from the same period in 2011, according to data compiled by Bloomberg from Finance Ministry figures released in Tokyo today. The trade deficit for 2012 so far is a record 5.3 trillion yen.

The so-called hollowing out of Japan’s export champions, highlighted by a cut in Panasonic Corp.’s debt rating to one step above junk status by Moody’s Investors Service yesterday, underscores the urgency of kindling domestic demand. Japan’s political parties are facing off ahead of an election next month on how hard to press the central bank to boost stimulus.

“There’s no doubt that Japan’s economy is already in a recession,” said Kiichi Murashima, chief economist at Citigroup Inc. in Tokyo. “Political pressure for further monetary easing is building, and we expect the BOJ to take additional measures in January.”

The yen slid to a seven-month low after the trade data were released, trading at 81.89 per dollar as of 3:36 p.m. in Tokyo after touching 81.97. The Nikkei 225 Stock Average advanced for the fifth time in six trading days, closing up 0.9 percent amid the weaker yen and speculation that the opposition Liberal Democratic Party, led by Shinzo Abe, will form the next government and push the BOJ into increased stimulus.

(...) [article here]

Tuesday 20 November 2012

FDI IN CHINA

afp_logo

FOREIGN INVESTMENT IN CHINA DROPS IN OCTOBER

AFP, November 20, 2012

BEIJING — Foreign direct investment in China fell again in October, the government said Tuesday, as investors remained cautious amid global economic woes and China's own slowdown.

Foreign companies invested $8.3 billion in factories and other projects in China last month, down 0.24 percent from a year ago, Shen Danyang, Ministry of Commerce spokesman, said at a regular news conference.

The drop extended a broad downward trend stretching back to November of last year. Since then, FDI has declined every month except May, when it rose a marginal 0.05 percent.

For the first 10 months of the year, FDI fell 3.45 percent on year to $91.7 billion, Shen said.

The government has blamed the slump on the slowdown in global economic growth, the prolonged European debt crisis and rising costs and weak demand at home.

(...) [article here]

Sunday 18 November 2012

NUCLEAR ARMS RACE IN SOUTH ASIA

The Hindu

COLD WAR LESSONS FOR INDIA AND PAKISTAN

Russian experts insist that continuous engagement even in the face of deep mistrust is the key to nuclear arms control

Vladimir Radyuhin

The Hindu, November 19, 2012

Russia’s missiles may still be trained on the United States but it is the nuclear arms race between India and Pakistan that worries Russian experts more than American nukes.

Scholars gathered at the Institute of World Economy and International Relations (Imemo), a top-rated Russian think-tank advising the Kremlin, rang alarm bells about the threat of nuclear war in South Asia, which today is greater than anywhere else in the world.

It was pointed out that India and Pakistan are the only two nuclear weapon states locked in a permanent conflict that occasionally escalates to armed confrontation, making the nuclear standoff particularly dangerous. Pakistan’s refusal to make a no-first-use pledge, its development of tactical nuclear weapons, India’s missile defence programme were all seen as factors driving the nuclear arms race in the region and heightening the risk of nuclear conflict.

(...) [article here]

Saturday 17 November 2012

ASIA, THE US FISCAL CLIFF AND THE EU RECESSION

The Star

NO NEW YEAR CHEER FOR ASIA

Morgan Stanley Research says China needs to initiate stru ctural reforms to transition towards higher valued-added economic activities, accelerate the fiscal transfers towards social security and boost private consumption.

Fintang Ng

The Star, November 17, 2012

THE outlook for Asia's economies remain very much in the balance even as growth momentum bottomed out in October with an improvement in external demand, purchasing managers indices and factory output.

Growth continues to be weighed down by concerns over the looming US fiscal cliff (simultaneous tax increases and spending cuts mandated by law to rein in the budget deficit) and the recession in Europe.

External demand remains under pressure despite the recent improvement seen in data for September and October across the region while domestic demand, although resilient, is starting to feel the impact of slower growth.

Citigroup Inc's Asia-Pacific chief economist Johanna Chua cautions that the rebound for the region will be mild in the fourth quarter and going into 2013 because Chinese policymakers are unlikely to come up with any fresh stimulus beyond what has been factored in for the year while business sentiment will be clouded by concerns over political risks arising from the US fiscal cliff.

(...) [article here]

Friday 16 November 2012

CHINA: URBANIZATION AND IMBALANCES

The Star

URBANISATION KEY FOR CHINA

McKinsey study shows it could cure nation’s economic imbalances

The Star, November 16, 2012

BEIJING: China's urbanisation could cure its economic imbalances, a new study shows, putting it on a path to domestic consumption-led growth within five years to replace three decades of investment and export-driven development that stoked global trade tensions.

The report by consultants at McKinsey comes as International Monetary Fund (IMF) models show China's current account surplus remains too big, despite a narrowing of global imbalances in the wake of the 2008/09 financial crisis and which IMF officials say could swell again as world economic growth recovers.

“We see this as being a turning point in the Chinese economy, really for the next few decades,” Jonathan Woetzel, a director in McKinsey, told Reuters.

“The world has only one model for economic development: modern societies are urban, consumer-driven, productivity-led and services-oriented. China, currently is none of these,” Woetzel said, “but urbanisation is the most crucial.”

The report, “What's Next for China”, forecasts that further urbanisation will see the consumer share of gross domestic product (GDP) in the Chinese economy reverse its long decline and accelerate over the next five years to see private consumption overtake investment as the biggest component of the economy by 2025.

That will be driven in part by household incomes across the country growing consistently faster than GDP growth in every year from 2012 out to at least 2030.

(...) [article here]

Thursday 15 November 2012

CHINA’S NEW STANDARD COMMITTEE

cnn-logothumbnail

AFTER MONTHS OF MYSTERY, CHINA UNVEILS NEW TOP LEADERS

Jaime A. FlorCruz and Jethro Mullen

CNN, November 15, 2012

Beijing (CNN) -- China on Thursday unveiled the elite group of leaders who will set the agenda for the country for the next decade, the culmination of months of secretive bargaining and a carefully choreographed performance of political pomp.

The seven members of the powerful committee that sits atop the Chinese system strode out onto a stage in the Great Hall of the People in Beijing. They were led by Xi Jinping, who takes over from Hu Jintao as head of the Communist Party, which has ruled China for more than 60 years.

Xi is joined on the new Politburo Standing Committee, the party's top decision-making body, by Li Keqiang, who is expected to replace Wen Jiabao as premier early next year, and five other veteran party officials.

Although the committee's lineup is new, analysts said it appeared to be predominantly conservative and unlikely to bring about meaningful political changes in the world's most populous nation and second largest economy.

Xi also succeeded Hu as head of China's powerful Central Military Commission, which oversees major national security and military affairs. That makes for a cleaner transition than in the past two power handovers, when the former party chiefs held onto the key military role for years afterward, using it to keep exercising considerable power and influence.

A far cry from the relentless media campaigns and frequent public appearances of U.S. presidential candidates, the efforts to determine who ended up in China's most powerful posts have taken place behind closed doors, part of a once-in-a-decade leadership transition.

(...) [article here]

Tuesday 13 November 2012

CHINA’S REFORMS HIT A WALL

cnn-logothumbnail

IDEOLOGY, VESTED INTERESTS: WHY CHINA'S REFORMS HAVE HIT BRICK WALL

Willy Lam

CNN.com , November 13, 2012

Editor's note: Willy Lam is Adjunct Professor of History at the Chinese University of Hong Kong and Senior Fellow with the Jamestown Foundation in Washington D.C. He is also a regular contributor for CNN on Chinese affairs.

(CNN) -- There is only one thing that Chinese and foreign observers of China are looking for at the 18th Chinese Communist Party (CCP) Congress: signs of reform, especially political liberalization.

The chances of meaningful political changes, or those that dovetail with global norms, however, are getting increasingly slim.

The reason may be simple. Until around about the time of the Tiananmen Square protests in 1989, to reform or not to reform belonged in the realm of ideology.

Even before the birth of the People's Republic in 1949, factions within the party had fought over the future direction of the country.

When Mao Zedong was running the show, there was the celebrated "struggle between two lines." This referred to the fierce competition between the Maoists -- who claimed to uphold unadulterated Marxism -- and the "capitalist roaders," led by then-president Liu Shaoqi and Deng Xiaoping.

(...) [article here]

Sunday 11 November 2012

HU AND THE MILITARY

Bloomberg_logo

HU MAY KEEP XI WAITING TO TAKE CONTROL OF CHINA’S MILITARY

Bloomberg News

Bloomberg, November 12, 2012

Xi Jinping may have to wait two years to gain control of the world’s largest army after he takes the Communist Party’s top job this week, a delay that may weaken China’s ability to address tensions with Japan and the U.S.

In China’s past two transitions of power, the departing leader kept hold of the military for about two years. That pattern would keep President Hu Jintao atop the party’s Central Military Commission, which has direct oversight of the armed forces, even after he steps down as party general secretary.

Hu could complicate Xi’s efforts to consolidate power and create new room for political jockeying after China’s leadership transition was roiled by the downfall of former Politburo member Bo Xilai. A confused chain of command may muddle China’s handling of territorial disputes with Japan, at a time when the U.S. is concerned that Chinese leaders are using nationalism to paper over domestic tensions.

“When the party leadership is united, it’s obvious the party controls the gun,” Huang Jing, a political science professor at the National University of Singapore who expects Hu will stay on as military chief, said in a phone interview. “But when the party is divided or weak, whoever has the gun has the last say.”

(...) [article here]

XI JINPING’S HARD TASKS

The Japan Times

LEAVING HARD TASKS TO NEW LEADER

The Japan Times, November 11, 2012

China is now in the final stage of preparation for its leadership transition, as the once-every-five-years national congress of the Chinese Communist Party (CCP) is in session with some 2,300 delegates attending.

Under outgoing President Hu Jintao, who led China for the past 10 years, the country has achieved rapid economic growth, surpassing Japan in 2010 to become the world's No. 2 economy. During Mr. Hu' tenure, China's economy grew nearly four times in size and its per capita gross domestic product in 2010 was 3.2 times the 2002 figure. Current per capita GDP is estimated at $5,000. This is a great achievement.

Mr. Xi Jinping, expected to be elected China's new leader at the end of the party congress, will inherit enormous side effects caused by China's economic development as well as its achievements.

To maintain its legitimacy, the CCP must continue to increase the economic fruit for people. But this process has produced problems such as a growing gap between rich and poor, widespread corruption, and environmental disruption. China, with a population of 1.34 billion, has significant ethnic problems. China's new leadership clearly will confront great challenges.

(...) [article here]

Saturday 10 November 2012

CHINA: REFORMERS’ HOPES

The Washington Post

LI KEQIANG, CHINA’S NEXT PREMIER, CARRIES REFORMERS’ HOPES

Keith B. Richburg

The Washington Post, November 10, 2012

BEIJING — Li Keqiang, the man slated to become China’s next premier, is described by several former classmates and associates as a cautious political climber who moved up slowly through the Communist Party’s bureaucracy while quietly maintaining friendships with pro-democracy advocates.

Li’s ties to known reformers have given some people here hope that once installed in the Chinese government’s No. 2 position — a promotion that is expected to be formalized at the conclusion of the party congress next week — he might become an inside advocate for changing the country’s autocratic, Leninist system.

But friends and former associates also said that Li was always reticent when speaking, rarely revealing much about his personal views — leaving them to only guess that he shares the reform agenda. “He’s the kind of person whose mind you can’t really read,” said Dai Qing, a democracy activist who was jailed for nearly a year after the 1989 student protests.

China’s outgoing premier, Wen Jiabao, also was seen by many here as a reformer who in recent years began publicly advocating for more accountability and less corruption in China’s Communist-run government. But without allies, Wen became an increasingly isolated voice for reform, unable — or unwilling — to push through his agenda. Some of Li’s friends and associates now wonder if he will suffer the same fate.

Li is described as an extremely intelligent self-taught speaker of English and a loyal Communist Party member who gave up a rare opportunity to study abroad when the party asked him to stay in China to work organizing students at Peking University as a top official in the Communist Youth League. It was at the university that Li made friendships with many outspoken pro-democracy advocates, some of whom were jailed or went into exile after the 1989 military crackdown at Tiananmen Square.

(...) [article here]

Friday 9 November 2012

CONSERVATIVES IN CHINA

The Times of India

THE CHINA SYNDROME:  CONSERVATIVES TO THE FORE

Saibal Dasgupta

The Times of India, November 9, 2012

BEIJING: A cursory look at the names of the likely candidates for top positions in the Communist Party's Politburo standing committee suggests it's going to be packed with conservatives. There's also speculation that the size of the committee, which governs the country, would be reduced from nine to seven.

With vice president Xi Jinping elevated as party general secretary, he is on course to replace PresidentHu Jintao. Vice premier Li Keqiang replacing premier Wen Jiabao is a foregone conclusion. But a conservative standing committee is bound to inhibit Xi's plans for greater liberalization, sources said.

Reports seeping out of the party's closed interiors indicate that two of President Hu's supporters, earlier considered for the committee, have been axed. They are Wang Yang, the party boss of Guangdong province, regarded as a liberal towards political dissent, and Li Yuanchao, director of the party's organization department.

The first time Xi signaled his rising clout and showed signs of independent thinking was at a party event in 2008. He said the CPC had matured from a party of revolution into one which "holds the power to rule the country in the long term". He called on all party members to adapt themselves to this fundamental change.

(...) [article here]

Thursday 8 November 2012

HU JINTAO’S SPEECH

Reuters DEF

HIGHLIGHTS - EXCERPTS OF HU JINTAO'S SPEECH TO CHINA PARTY CONGRESS

Reuters, November 8, 2012

BEIJING (Reuters) - China's ruling Communist Party began a congress on Thursday at which President Hu Jintao will give up his position as head of the party to his designated successor, Vice President Xi Jinping.

In a speech at the Great Hall of the People, Hu lauded three decades of growth, which have elevated China to the world's second-largest economy after the United States and lifted hundreds of millions of Chinese citizens out of poverty, and laid out priorities and challenges for the future.

Below are highlights of Hu's speech:

POLITICAL REFORM

"The reform of the political structure is an important part of China's overall reform. We must continue to make both active and prudent efforts to carry out the reform of the political structure, and make people's democracy more extensive, fuller in scope and sounder in practice."

FIGHTING CORRUPTION

Hu said the party must make unremitting efforts to combat corruption, promote integrity and stay vigilant against degeneration.

"If we fail to handle this issue well, it could prove fatal to the Party, and even cause the collapse of the Party and the fall of the state."

RULE OF LAW

"We must never let words act in place of the law or (personal) power replace the law; nor will we allow disregard for the law for personal benefit."

ECONOMIC TARGETS

"On the basis of making China's development much more balanced, coordinated and sustainable, we should double its 2010 GDP and per capita income for both urban and rural residents (by 2020).

"We should firmly maintain the strategic focus of boosting domestic demand, speed up the establishment of a long-term mechanism for increasing consumer demand, unleash the potential of individual consumption, increase investment at a proper pace, and expand the domestic market."

(...) [article here]

Wednesday 7 November 2012

HU JINTAO

associated-press-logo

HU JINTAO'S LEGACY: A STRONG BUT STRAINED CHINA

Charles Hutzler

Associated Press, November 7, 2012

BEIJING (AP) — As Hu Jintao steps down as head of China's Communist Party after 10 years in power, he's hearing something unusual for a Chinese leader: sharp criticism.

In media commentaries, think-tank position papers and the less censored blogosphere, Hu's reign is being portrayed as a missed opportunity to tackle longstanding problems grown more deep-seated, from a yawning rich-poor gulf and worsening environmental degradation to stiffly authoritarian politics. One commentary has referred to the period as a "lost decade."

"We didn't realize Hu would turn out to be so conservative," said Wu Jiaxiang, a former party researcher-turned-businessman and avid blogger, summing up the disappointment of many in China's chattering classes. He dates his own disappointment with Hu to the closing of liberal-minded websites in 2005.

Some of the criticisms are designed to influence Xi Jinping, who will begin taking over from the technocratic, ultra-reserved 69-year-old Hu at a party congress that opens Thursday.

Mainstream state media, which answer to the party and dominate what most Chinese see, read and hear, have been praising the Hu era, calling it a "Glorious Decade."

(...) [article here]

Tuesday 6 November 2012

CHINA’S LEADERS

DNA

CHINA'S LEADERSHIP TRANSITION PROCESS BEGINS THIS WEEK

IANS

DNA, November 6, 2012

The world's most populous and one of the most economically powerful nations, which is also one of the world's most secretive countries, will see the beginning of a crucial leadership transition during the 18th National Congress of the Communist Party of China (CPC) in Beijing on Thursday.

The new leader of the world's second largest economy that is increasingly influencing the global discourse and was one of the few countries that figured repeatedly in the bitterly fought US election campaign will be, in all likelihood, Vice President Xi Jinping, who will succeed President Hu Jintao as general secretary of the all-powerful Communist Party after being elected to the new Central Committee which will in turn "elect" the new Politburo.

Li Keqiang is likley to be the premier in the next leadership, succeeding Wen Jiabao, according to reports, though there has been no official communication so far. It is also not clear if Xi will also head the all-powerful Central Military Commission, replacing Hu as China's commander-in-chief. Xi will be elected as the country's next president in March next year by the National People's Congress, China's rubber-stamp parliament. He is likely to remain as such for the next ten years before the next big leadership change.

The Communist Party is the sole party in power in China and has nearly 70 million members in more than three million grassroots organisations.The CPC has established formal and informal organizations within the Chinese government and various levels and walks of life in the country, according to people.com.cn.

(...) [article here]

Sunday 4 November 2012

CHINA: HARDLINERS AND THE ECONOMY

The Canberra Times

LEADERSHIP CHANGE THREATENS CHINA'S ECONOMIC DESTINY

Ambrose Evans-Pritchard

The Canberra Times, November 5, 2012

If reports from the Hong Kong press and China's blogosphere are correct, a remarkable upset has occurred on the eve of the ten-year power shift next week -- the greatest turn-over of top cadres since Mao's revolution.

The South China Morning Post says the new line-up of the Politburo's Standing Committee is "packed with conservatives". The succession deal agreed over the summer has been scuppered.

The 86-year Mr Jiang -- who rose to supreme leader on the bones of Muxidi and Tiananmen in 1989 -- has placed his accolytes in charge of the economy, propaganda, as well as the Shanghai party machine.

The hardliners seem poised to snatch control of the seven-man Committee, tying the hands of incoming president Xi Xinping and premier Li Keqiang. If confirmed, long-term investors may have to rethink their core assumption about the future course of China.

This power struggle going into the 18th Party Congress matters more in the sweep of history than the run-off two days earlier between a centrist Barack Obama or the centrist Mitt Romney, though the stage drama is less compelling.

Mr Jiang's rear-guard coup should give pause to thought. It was he who instituted the Patriotic Education movement in schools in the 1990s, whipping up nationalist fervour to replace the lost mystique of Maoism. The effect was to nurture revanchist hatred against Japan, creating a monster that now requires feeding.

(...) [article here]

THE WUKAN MODEL

Bangkok Post

CHINA'S NEW LEADERS TO FACE EMBOLDENED CRITICS

A year ago, the villagers of Wukan in China forced their corrupt local leader to flee in a rebellion that shook the Communist Party and which serves as a warning to the country's incoming leaders

AFP

The Bangkok Post, November 4, 2012

At a congress starting Thursday, the party will anoint a new chief for the next 10 years, whose regime will have to address growing anger over graft as well as challenges from a vocal band of dissidents and rights activists.

In the Wukan revolt, villagers defied the usually iron-fisted police and forced their long-standing party chief to flee after angry demonstrations denouncing shady land deals during his decades-long tenure.

The crisis was defused in December when provincial authorities in Guangdong stepped in, agreed to untangle the complex web of land transfers to private developers, sacked the party chief and allowed villagers to hold elections.

The newly elected deputy head of the village has a message for Xi Jinping, the 59-year-old vice president who is widely expected to be promoted to Communist Party general-secretary this week and then state president next year.

"If they don't wipe out and punish corruption, then things are only going to get worse," Yang Semao told AFP in Wukan, a small fishing and farming village of about 12,000 people.

"If they don't crack down on graft, then you are only going to encourage more people to be corrupt (and) the new government leaders will become corrupt," he said in an interview in his office.

(...) [article here]

Saturday 3 November 2012

POLITICAL STAKES IN CHINA

WashPost logo3

IN CHINA, A GUESSING GAME

David Ignatius

The Washington Post, November 3, 2012

As Election Day approaches, it’s useful to look at the murky political transition taking place in China this month. It’s a reminder of the benefits of America’s sometimes chaotic democracy.

The Chinese are facing a once-in-a-decade political shift as President Hu Jintao prepares to transfer power to Xi Jinping, his long-designated successor. But beneath this pre-cooked surface, many key issues are still bubbling, with a decisive Communist Party congress scheduled to start Thursday.

Imagine if the United States were deciding Tuesday not just on a president and members of Congress — but on the size and scope of the executive branch, oversight of the military and new constitutional rules. China’s leaders are still thought to be haggling over all these issues on the eve of the party congress and behind a curtain of secrecy that feeds rumors and gossip.

The coming political transition will replace most members of the country’s two key executive bodies — the standing committee of the party’s Politburo and the Central Military Commission. What’s amazing is how little even the best-informed U.S. experts know about how these personnel decisions will be made.

Given China’s lack of transparency, this arcane subject is left mostly to China-watchers in and out of government. But the political stakes in Beijing this month may be as important for the world as are those in the U.S. election. Here are some of the big “ifs” that experts are following:

(...) [article here]

Friday 2 November 2012

CONSERVATIVES IN THE CPC

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CONSERVATIVES DOMINATE LATEST LINE-UP FOR NEW COMMUNIST PARTY LEADERSHIP

Conservatives show they still hold sway as reform-minded candidates lose out in the latest line-up for Politburo Standing Committee

Shi Jiangtao

South China Morning Post, November 2, 2012

Conservatives appear poised to dominate the Communist Party's new leadership as furious horse trading continues ahead of next week's transfer of power in Beijing.

The latest consensus among outgoing leaders, their immediate successors and influential party elders is that the party's innermost circle may still be subject to last-minute changes ahead of the 18th congress starting on Thursday, according to sources close to the inner workings of the once-a-decade generational transition.

However, the sources said that the Politburo Standing Committee's likeliest line-up was now packed with conservatives including vice-premier and Chongqing party chief Zhang Dejiang , 65, propaganda chief Liu Yunshan , 65, Shanghai party boss Yu Zhengsheng , 67, and Tianjin party chief Zhang Gaoli , 65.

They said the biggest surprise was the omission of two reform-minded protégés of party general secretary Hu Jintao - party organisation department head Li Yuanchao , who turns 62 this month, and Guangdong party chief Wang Yang , 57 - mainly due to their relative youth and opposition from conservative party elders, including former premier Li Peng .

(...) [article here]

Thursday 1 November 2012

TIME TO END ONE-CHILD POLICY

associated-press-logo

CHINA THINK TANK URGES GOV'T TO END 1-CHILD POLICY

Alexa Olesen

Associated Press, November 1, 2012

BEIJING (AP) — A government think tank is urging Chinese leaders to start phasing out China's one-child policy immediately and allow two children for every family by 2015, a daring proposal to do away with the unpopular policy.

Some demographers see the timeline put forward by the China Development Research Foundation as a bold move by the body close to the central leadership. Others warn that the gradual approach, if implemented, would still be insufficient to help correct the problems that China's strict birth limits have created.

Xie Meng, a press affairs official with the foundation, said the final version of the report will be released "in a week or two." But Chinese state media have been given advance copies. The official Xinhua News Agency said the foundation recommends a two-child policy in some provinces from this year and a nationwide two-child policy by 2015. It proposes all birth limits be dropped by 2020, Xinhua reported.

"China has paid a huge political and social cost for the policy, as it has resulted in social conflict, high administrative costs and led indirectly to a long-term gender imbalance at birth," Xinhua said, citing the report.

(...) [article here]