If you have any questions or concerns please respond to toni.zhou@ogilvy.com
The Daily China News Update is produced by Charles Silverman
(02/26/13)
Business & Economics
Newswire
Chery Hires Porsche Designer to Oversee Car Design From Shanghai (Bloomberg)4
Heinz to Sell China Packaged Food Business (Bloomberg) ............................................... 5
China Factory Growth Slips From Recent High (Reuters).................................................. 5
Print
China Shares End Higher Despite Fall in HSBC PMI (The Wall Street Journal) .......... 7
Online
China's Fast-Growing WeChat Shakes Up Weibo. Could It Jump to the US?
(adage.com) ....................................................................................................................................... 7
Hong Kong Notches $84 Million Home Sale (THE WSJ CHINA REAL TIME REPORT
BLOG) ................................................................................................................................................... 9
Is China’s Property Market Topping Out? (THE WSJ CHINA REAL TIME REPORT
BLOG) ................................................................................................................................................ 10
Acer Expects Notebook Shipments Down 10% In Q1 2013 (chinatechnews.com) 11
Will China Ever Get Rich? (chinalawblog.com) ................................................................... 11
Don’t miss a thing with Youku’s new scanner app (Youku Buzz) ................................ 12
The Difficulty of Figuring Out Who Owns What in China (theatlantic.com) ............. 12
China flash PMI: reasons to be down, reasons to be cheerful (The FT Beyond BRICs
Blog) .................................................................................................................................................. 14
Chart of the week: the ups and down of Chinese property stocks (The FT Beyond
BRICs Blog)...................................................................................................................................... 15
China: web games company tests the water for US float (The FT Beyond BRICs Blog)
............................................................................................................................................................ 16
China’s Tencent to Open Office in US Devoted to WeChat App (techinasia.com) .... 17
Why the WeChat vs. Weibo War Will Be the Year’s Biggest Story, and Why Weibo
Needs to Win (techinasia.com) ................................................................................................ 17
Quick profile of China's 564 million netizens across digital, social, mobile.
(resonancechina.com) ................................................................................................................ 19
Foxconn On Menu To Manufacture Vizio's Next Smartphone
(chinasourcingnews.com) ......................................................................................................... 19
Politics & Law
Newswire
Chinese Hackers Seen as Increasingly Professional (The Associated Press) .......... 20
BBC says radio broadcasts being jammed in China (Reuters) ....................................... 22
Print
America's two-faced tirade against Chinese 'cyberwar' (South China Morning Post)
............................................................................................................................................................ 23
China-Japan dispute a powder keg, says US (The Australian) ....................................... 24
A New Cold War, in Cyberspace, Tests U.S. Ties to China (The New York Times) .... 25
'Second Generation Red' fall in behind Xi Jinping (The Age) ........................................ 27
Online
China Austerity Drive Becomes a Joke (THE WSJ CHINA REAL TIME REPORT BLOG)
............................................................................................................................................................ 29
House Intelligence Chairman: U.S. ‘Losing’ Cyber War (THE WSJ CHINA REAL TIME
REPORT BLOG) .............................................................................................................................. 30
China, den of cannibals? (China Media Project) ................................................................. 30
Over half of Chinese officials have Weibophobia (offbeatchina.com) ........................ 33
Miscellaneous
Print
NAB opens farm gate to China (Sydney Morning Herald) ............................................... 34
For China’s Catholics, new pope is a cause for hope (THE WASHINGTON POST) ... 35
Airport tantrum becomes latest symbol of arrogance and entitlement in China
(The Guardian) .............................................................................................................................. 38
Online
DIY Dialysis; In China, desperate patients are forced to innovate.
(thedailybeast.com) ..................................................................................................................... 38
In Praise of @BeijingAir (rectified.name)............................................................................ 39
Taiwan Celebrates Ang Lee’s Best Director Oscar Win for ‘Life of Pi’ (THE WSJ
CHINA REAL TIME REPORT BLOG).......................................................................................... 40
Watch: Chinese Political Adviser Comes Utterly Undone at Airport (THE WSJ CHINA
REAL TIME REPORT BLOG) ....................................................................................................... 41
Ang Lee Best Director Win is Bittersweet for China Film Fans (THE WSJ CHINA
REAL TIME REPORT BLOG) ....................................................................................................... 42
TV Show Host Du Haitao Justifies Spring Festival Weight Gain (chinasmack.com) 43
Blazing a New Path for China’s Intellectually Disabled: Amity Bakery Heats Up on
Weibo (tealeafnation.com) ........................................................................................................ 46
Business & Economics
Newswire
Chery Hires Porsche Designer to Oversee Car Design From Shanghai (Bloomberg)
By Bloomberg News - Feb 24, 2013
http://www.bloomberg.com/news/2013-02-25/chery-hires-porsche-designer-to-oversee-car-design-from-shan
ghai.html
Chery Automobile Co., the state- owned Chinese maker of the low-cost QQ mini car, hired Hakan Saracoglu from
Porsche AG to head its design center in Shanghai in a bid to improve its styling.
Saracoglu, 47, joined Chery as design director in October, according to the Wuhu, Anhui province-based
automaker. The Turkish-born German national worked for 15 years at Porsche, where he helped design the
exteriors for models including the 918 Spyder, Boxster and Cayman.
Chery is the latest among Chinese automakers hiring foreign designers to help boost their brand image and
reverse a loss in market share to overseas automakers such as General Motors Co. (GM) and Volkswagen AG.
(VOW) The hirings are part of a broader hunt for international talent, with salaries for foreign auto engineers in
China reaching three times that in the U.S. and Europe, according to Sanford C. Bernstein & Co.
“Having somebody with a known profile gives you more credibility,” said Bill Russo, Beijing-based president of
auto consultancy Synergistics Ltd. “But it’s going to take a long time to really embed those capabilities.”
Other Chinese companies have also looked abroad for help with styling. Beijing Automotive Group Co., which
traces its roots to producing sidecar motorcycles for use in the Korean War, hired Ferrari Daytona designer
Leonardo Fioravanti as chief design officer last year.
Foreign Designers
Great Wall Motor Co. (2333), China’s biggest maker of sport- utility vehicles, appointed former Mercedes-Benz
designer Andreas Deufel as design director in 2011. Former Volvo Car chief designer Peter Horbury joined
Zhejiang Geely Holding (175) Group Co. the same year as senior vice president in charge of design.
Saracoglu, who said he had never visited China before being approached by Chery, started his career at Ford
Motor Co. (F)’s Cologne offices as part of the team on models such as the Focus and Mondeo. He received a degree
in transportation design from the Art Center College of Design in Pasadena, California.
In Shanghai, Saracoglu will lead a team of 30 to come up with new concepts for models from sedans to SUVs.
“Chery is not just QQ, we’re going to change that,” he said in a phone interview on Feb. 22. “The company is
redefining itself. Chery’s standing for value, for design and gaining customer confidence. That’s where we want to
go.”
Chery has a 50-50 joint venture to produce Tata Motors Ltd. (TTMT)’s Jaguar Land Rover in China. It also co-owns
startup carmaker Qoros Auto Co. with Israel Corp.
Asked how much of a salary increase he was offered to leave Porsche, Saracoglu said, “I cannot comment on that.
Let’s say I’m not unhappy.”
To contact Bloomberg News staff for this story: Alexandra Ho in Shanghai at aho113@bloomberg.net
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net
Heinz to Sell China Packaged Food Business (Bloomberg)
By Bloomberg News - Feb 25, 2013
http://www.bloomberg.com/news/2013-02-25/heinz-to-sell-china-packaged-food-business.html
H.J. Heinz Co. (HNZ), the ketchup maker which agreed to be acquired in a $23 billion buyout this month, will sell
its China packaged food business to Zhengzhou Sanquan Foods Co. (002216)
Zhengzhou Sanquan signed a deal with H.J. Heinz’s subsidiaries, Country Ford Development Ltd. and Heinz
(China) Investment Co., to buy Shanghai Long Fong Co. on Feb. 22, Henan- based Zhengzhou Sanquan said in a
statement to the Shenzhen stock exchange dated Feb. 23.
Zhengzhou Sanquan rose to its highest in 11 months in Shenzhen trading. The company, which sells frozen meals
and snacks such as fried chive dumplings on the mainland, said the purchase will help increase competitiveness
and expand market share. The acquisition will be financed using internal cash, it said, without giving a value for
the deal.
The sale is in line with “Heinz’s global strategy to de- emphasize non-core frozen food businesses outside the U.S.”
the Pittsburgh-based foodmaker said in an e-mailed statement. “The decision to seek a buyer for our Long Fong
frozen foods business in China is unrelated to the merger agreement with Berkshire Hathaway and 3G Capital.”
Heinz agreed Feb. 14 to sell itself to Warren Buffett’s Berkshire Hathaway Inc. (BRK/A) and Jorge Paulo Lemann’s
3G Capital Inc. for about $23 billion.
Shanghai Long Fong is involved in food packaging and frozen food on mainland China. The Long Fong brand sells
products in eight major categories including dumpling, rice ball, dim sum and hot-pot base, according to Heinz’s
website.
Zhengzhou Sanquan, which resumed trading today after being halted on Feb. 22, gained 3 percent to 29.33 yuan,
the stock’s highest close since March 19.
The transaction is expected to be completed in four months or less, Heinz said. Three calls to the main telephone
line of Zhengzhou Sanquan returned a busy signal.
To contact Bloomberg News staff for this story: Liza Lin in Shanghai at llin15@bloomberg.net; Vinicy Chan in
Hong Kong at vchan91@bloomberg.net
To contact the editor responsible for this story: Anjali Cordeiro at acordeiro2@bloomberg.net
China Factory Growth Slips From Recent High (Reuters)
Published: February 25, 2013
http://www.nytimes.com/2013/02/26/business/global/china-factory-growth-slips-from-recent-high.html?_r=0
BEIJING — Growth in the giant China manufacturing sector in February withdrew from the highest point in nearly
two years despite a fourth consecutive month of expansion, a private survey showed Monday, as foreign demand
remained unsteady.
The HSBC flash purchasing managers’ index for February slipped to 50.4, the lowest reading in four months and
down from the January reading of 52.3, which had been the best showing since January 2011. Index readings
higher than 50 indicate expansion, while those lower than 50 indicate contraction.
The flash P.M.I. is the earliest indicator of China’s economic health each month and should not alter expectations
that China, which has the world’s second-largest economy, after that of the United States, is enjoying a gentle
recovery, experts said. That would be a welcome development for China’s new leaders, who take office in March.
“The underlying strength of the Chinese growth recovery remains intact, as indicated by still-expanding
employment and the recent pickup of credit growth,” said Qu Hongbin, an economist at HSBC.
In line with recent trends, the flash P.M.I. showed demand for Chinese exports wobbling in February. A subindex
measuring new export orders slipped to 49.8.
The export sector has been a weak point for the Chinese economy in the past two years, as faltering global
economic growth has caused net exports to drag on growth.
Although export growth surged to a 21-month high in January in a sign that business was picking up, most
economists say that exporters face continued difficulty as demand from Europe and the United States languishes.
Still, the survey did not suggest that China’s factories were re-entering a slowdown. While most P.M.I. subindexes
fell in February, they were pulling back from highs of several months, suggesting that manufacturers were only
taking a breather.
Some economists may attribute the dip in the February data to the Lunar New Year holiday, which began Feb. 10
this year and fell in January last year, although the survey’s publisher, Markit, says the data are seasonally
adjusted.
The output subindex fell from a 22-month high; new orders backed away from a 20-month high; factory
employment edged down from its highest level in 20 months; input prices fell from a 16-month peak; and output
prices slid from a 14-month high.
As in previous months, the February survey showed that domestic demand had held up better than demand from
abroad. The new-order subindex remained comfortably above 50, even after falling from its January level.
China holds its annual full-session parliamentary meeting March 5, when the incoming president, Xi Jinping,
officially takes the reins of state power, while the departing prime minister, Wen Jiabao, presents the
government’s 2013 economic goals.
Most analysts believe Beijing will retain its 2012 goal for gross domestic product growth of 7.5 percent for this
year, giving itself some room to surpass expectations slightly.
The Chinese economy grew 7.8 percent in 2012, about in line with expectations, but still the slowest rate in 13
years. Analysts polled by Reuters expect the economy to grow 8.1 percent in 2013.
The rebound, though gentle, would comfort investors banking on a modest Chinese economic recovery to lift
global growth.
Indeed, February was still the fourth consecutive month in which the flash P.M.I. was above 50, despite the
retreat. Before the turnaround that began in November, the index had languished at less than 50 for 12
consecutive months.
The HSBC P.M.I. survey is based on a poll of purchasing executives from more than 420 manufacturing firms. The
flash P.M.I. is compiled from responses from 85 percent to 90 percent of that pool. The final results will be
published March 1.
Print
China Shares End Higher Despite Fall in HSBC PMI (The Wall Street Journal)
February 25, 2013
http://online.wsj.com/article/BT-CO-20130225-701013.html
SHANGHAI--China's shares ended higher Monday on hopes that the revised rules on qualified foreign institutional
investors will boost the domestic stock market, mostly ignoring data showing a decline in China's manufacturing
activity in February.
The benchmark Shanghai Composite Index, which tracks both A and B shares, ended up 0.5% at 2325.82. The
Shenzhen Composite Index rose 0.9% to 955.79.
The preliminary HSBC China Manufacturing Purchasing Managers Index, a gauge of nationwide manufacturing
activity, fell to 50.4 in February, compared with a final reading of 52.3 in January, HSBC Holdings PLC said Monday
morning, due to weakness in global demand for the country's exports as well as the Lunar New Year holidays,
raising concerns over the momentum of recovery in the world's second-largest economy.
"The Chinese economy is still on track for a gradual recovery," HSBC economist Qu Hongbin said in a statement.
He noted that the February reading still marks the fourth straight month that the index has been above the
boom-bust line at 50, showing that manufacturing still grew in February, just at a slower pace than in January.
Indeed, the markets resumed their uptrend in the afternoon session as investors continued to react positively to
a Xinhua News Agency report over the weekend that China will soon implement revised rules that will allow
qualified foreign investors to invest more of their offshore yuan holdings in China's stock market.
"We think the upcoming (revised) rules on foreign institutional investors is a positive for the market as it will mean
more funds entering the domestic stock market," said Capital Securities analyst Amy Lin.
Under the revised rules, the Renminbi Qualified Foreign Institutional Investors program will allow more types of
investors to join, Xinhua said, citing the China Securities Regulatory Commission.
The revised rules will also remove the limitations on their investment portfolio, Xinhua said. At present, at least
80% of RQFII funds must be invested in fixed-income assets while no more than 20% can be invested in equities.
Brokerages rallied on a media report that an intermediary body set up to expand China's nascent margin-trading
and short-selling market will launch a pilot short-selling business on Feb. 28.
China Securities Finance Corp. will allow eleven securities firms to short-sell 90 stocks, the report said. The stocks
picked have a combined 9.3 trillion yuan ($1.49 trillion) of tradable market capitalization, representing nearly
50% of China's total A-share market capitalization, and offer investors good liquidity, the report said.
The start of a short-selling business will generate another revenue engine for brokerages, analysts said.
Citic Securities (600030.SH) was up 1% at CNY13.84, GF Securities (000776.SZ) rose 1.5% to CNY15.12, and
Huatai Securities (601688.SH) gained 0.6% to CNY10.49.
Write to Yue Li at yue.li@dowjones.com
Online
China's Fast-Growing WeChat Shakes Up Weibo. Could It Jump to the US?
(adage.com)
Brands and 300 Million Users Embrace Asia's New Chat Phenom
By: Anita Chang Beattie Published: February 25, 2013
http://adage.com/article/digital/chinese-mobile-app-wechat-shake-shakes-social-crm/239938/
Move over, Weibo. Here comes WeChat. Weibo, China's microblogging platform that's a hybrid of Twitter and
Facebook, was the hot place to be as recently as last year. Now, marketers are clamoring to engage with WeChat
and the 300 million users it's amassed in just two years.
"Everyone is using WeChat, so marketers are wondering how can they use it in their communications," said
Sophia Ong, the executive at WeChat's parent company, Tencent, who helps marketers navigate the internet
giant's myriad platforms. "They know it's very influential, everyone is using and sharing it. And slowly some
brands are coming out with official WeChat accounts."
WeChat on mobile phone
China's newest digital darling is a mashup of several existing applications, with a few fun features like "Shake
Shake" and "Drift Bottle." WeChat users trade text, audio and video messages with friends over mobile-data
networks. There's a popular group-messaging function and newly unveiled live-chat capabilities. Photos can be
posted on an Instagram-like "Moments" page, while "Look Around" identifies other WeChat users nearby. There's
also a QR-code reader.
"We love to use all the social connections because different people want to connect with us in different ways," said
Ben Wilson, marketing director for Reckitt Benckiser in China, talking about Durex's online-communication
strategy. "On WeChat, you can be a little more personal."
One big reason for WeChat's stellar growth is that contact lists are linked to Tencent's QQ instant-messaging
platform, which has more than 700 million active accounts. But users can also make friends through Drift Bottle
-- picking (and sending) notes at random from mobile cyberspace. Shake Shake connects users who happen to be
shaking their smartphones at the same time. It's a quick way to swap contact details. Pete Blackshaw, global head
of digital at Nestle, recently tweeted about having a major WeChat "shake-fest with friends and colleagues."
Should Twitter, Facebook, Instagram, WhatsApp, Skype and others be worried? Considering that WeChat's stellar
growth has come in large part from QQ, maybe not. But Mark Natkin, a technology analyst in Beijing, says the
West can learn a thing or two from WeChat.
"They can be a little more aggressive in adding more social features more quickly," he said. "In the earlier stages,
any user you mentioned WeChat to would say, "Oh, Shake Shake! I can go out and meet people I don't know.' It
was something interesting and unusual. And that got a lot of buzz going, getting people to try it."
Out of all the Chinese digital products, WeChat is perhaps the best positioned for global expansion. Launched in
January 2011 as Weixin ("way-sheen"), it was rebranded in April 2012 with the globally palatable moniker
WeChat. It's offered in languages from English to Turkish to Arabic. Tencent says WeChat is Apple's No. 1
social-networking app in Southeast Asian countries like Thailand and Malaysia, but also in Saudi Arabia. It's being
promoted in Indonesia, India, Argentina and Australia.
Blog TechNode quoted WeChat Product Director Zeng Ming as saying that Europe and the States is its next
challenge.
Tencent has been picky about who's allowed to do WeChat marketing. "Every time we talk to clients, we say you
have to commit to doing social CRM," Ms. Ong said.
How Marketers in China Are Using WeChat
Durex
Durex uses WeChat in a culture where public discussion about private issues is uncommon. Fans curious about
love, sex and relationships get a response from a real person, even at 2 a.m. "We try to be there when you expect
a friend to be there for you," said Ben Wilson, marketing director for Reckitt Benckiser in China. Each week, a
"newsletter" of Q-and-As is sent to Durex's WeChat friends.
Nike
Tens of thousands flocked to Nike's Festival of Sport last summer, sampling everything from skateboarding to
football to golf.
AKQA created a badge-collection system using WeChat's QR-code scanner, replacing a paper passport. Fans
completing certain challenges could win a chance to meet stars like LeBron James.
Intel
London Olympics competitions largely took place in the middle of the night in China. So Intel hired two celebrity
hosts to provide audio updates three times a day. Each morning, they summarized the previous night's events. At
lunchtime, fans were given an Olympics or Intel-related contest question. In the evening, the hosts announced
winners along with another sports update.
Starbucks
To reach customers through music, Starbucks asked fans: "How are you feeling today?" They responded with an
emoticon, and Starbucks answered with a song to match the mood. The chain added 270,000 WeChat friends over
the four-week campaign. "We don't just push offers at you," said Marie Han Silloway, Starbucks' marketing chief
for China. "We start a personal conversation."
Hong Kong Notches $84 Million Home Sale (THE WSJ CHINA REAL TIME REPORT
BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/hong-kong-notches-84-million-home-sale/?mod=WSJBlog
A two-story house at one of Hong Kong’s swankiest addresses has sold for an exorbitant $84 million, in another
sign of how the government’s efforts to tame the market have stumbled.
According to land registry data, a two-story house at Gough Hill Residences on Hong Kong’s tony Peak was sold
on the secondary market last November, only weeks after the government slapped a 15% tax on any non-local
residential buyers. The sale was finalized this past week.
Fueled in part by cash from mainland Chinese investors, Hong Kong property prices experienced a sharp run-up
in 2012, with home prices vaulting by 25% last year, according to government figures. The government has tried
to adopt wave after wave of cooling measures, including an additional round of measures last week, but to no
avail: property prices have continued to creep up, rising 2% last month.
Property analyst Wong Leung-Sing of realtor Centaline Properties, which has sold various houses in the area, said
that the $84 million sale was evidence of how investors in Hong Kong weren’t taking the government’s cooling
measures seriously.
“All the people have the same thinking—that the government cannot do anything about [home prices],” he says.
As long as there is quantitative easing around the world, Mr. Wong says, “people think the price in Hong Kong will
always get higher.”
Built in 2006 by Wheelock Properties, Gough Hill Residences consists of five opulent homes, all of which were sold
after completion to both mainland Chinese and local buyers, a company spokesman said. The five Peak
homes—described as part of a “limited collection” offering luxurious living—contain individual swimming pools
and are further outfitted with carports able to fit several vehicles, as well as carefully landscaped gardens.
While $84 million price tag eclipses most other sales in cities from New York to London, it still isn’t the highest
record for a home that’s ever been recorded in Hong Kong: in 2011, a three-story house was sold for $103 million.
This week’s buyer was registered as Xing Jian of Lucky Beat Investment Ltd., a company incorporated in the
British Virgin Islands. The home had originally sold in 2006 for $26 million dollars, according to land registry data,
at one-third the most recent selling price.
– Te-Ping Chen. Follow her on Twitter @tepingchen.
Is China’s Property Market Topping Out? (THE WSJ CHINA REAL TIME REPORT
BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/is-chinas-property-market-topping-out/?mod=WSJBlog
China’s economy has only just turned the corner after seven consecutive quarters of slowing growth, but people
are already looking for signs of overheating.
A key worry is the housing market. Unable to easily move their money overseas and distrustful of the stock
market, Chinese households have tended to dump cash into real estate when the economy is doing well.
“People have so much money they don’t know where to put it,” J.P. Morgan’s Jing Ulrich told an audience of
journalists on Feb. 25. “Property prices are a reflection of overall liquidity in the system.”
China’s property cycle is incredibly short, typically lasting only 14 months, Ms. Ulrich said. If the market bottomed
out in May or June of last year, we are nine months into the process.
Property developers have spent the last few months raising funds, buying more land and ramping up construction
and sales, Ms. Ulrich said. It might be time to start looking for a peak.
The exact timing of the cycle’s end will likely depend on the government. It watches the housing market closely
and is quick to step in when things start looking frothy.
Chinese home buyers in tend to put down a lot more cash and borrow less than their Western counterparts, so
interest-rate hikes have less impact on the market. Instead, the government has used requirements for minimum
down payments and restrictions on buying multiple homes to cool things down.
Though they never formally relaxed the rules, Ms. Ulrich said authorities judiciously started taking a more laid
back attitude to enforcement when it became clear the market was stuttering in the second half of 2012.
Now she is on the lookout for renewed signs of zeal in enforcing the curbs, which would be the easiest way to
suppress demand. Buying restrictions could also be extended beyond the 40 or so cities where they are now in
force.
In the long run, Ms. Ulrich said, a property tax now being trialed in Shanghai and Chongqing will surely be
introduced in other cities.
That would be a wake-up call for some buyers. It is not unusual for people to buy flats and keep them empty,
figuring that the premium for selling them in mint condition will be more than the rent. A recurring property tax
would change the economics of that strategy.
“Fundamentally we need a property market that’s more stable than this 14-month cycle,” Ms. Ulrich says. “I think
it’s the right thing to clamp down on rampant speculative buying.”
Aspiring homeowners, gazing up at the bottom rung of the housing ladder, might tend to agree.
– Josh Chin
Acer Expects Notebook Shipments Down 10% In Q1 2013 (chinatechnews.com)
February 26, 2013
http://www.chinatechnews.com/2013/02/26/19148-acer-expects-notebook-shipments-down-10-in-q1-2013
Taiwanese PC maker Acer said that its notebook shipments are expected to decrease by 10% to 15% for the first
quarter of 2013, due to seasonal factors.
According to reports in foreign media, Wang Jeng-tang, chief executive officer of Acer said the sales decline was
also attributed to customers' demands for new product replacements. Some users turned to smartphones, tablets,
and Windows 8 products. In October 2012, Microsoft launched its new version operating system to compete with
Apple; however, demand for PCs running on Windows 8 operating system were currently limited.
Despite the current situation, Wang was optimistic about the future. He said as long as Microsoft continues to
promote its new operating system and Surface tablets, the demand for Windows 8 PCs will definitely be
improving.
Wang predicted that tablet computing business will still be the sales growth point for Acer. Acer recently launched
its new 7-inch tablet Iconia B1-A71 with price of USD168 and the product achieved good sales since its launch.
Acer expected to ship over five million tablets in 2013, while the number was 1.8 million in 2012. Wang said Acer
will launch new Windows 8 products in the second quarter of 2013, which will be a good opportunity for their sales
to rebound.
In addition, Acer plans to ship two million smartphones in 2013, which is four times that of last year.
Will China Ever Get Rich? (chinalawblog.com)
By Dan Harris on February 25th, 2013
http://www.chinalawblog.com/2013/02/will-china-ever-get-rich.html
I don’t think so. Just my view.
Read an article in Forbes entitled, “What Could Derail A Middle Class China?” This article starts out by asking what
could prevent China from becoming a developed country and then sets out what usually prevents countries from
reaching “high-income status”:
The experience of countries that failed to make the jump to high-income status suggest that their inability to
innovate and upgrade can be attributed to three broad factors: (1) macroeconomic, political and social instability;
(2) persistent inefficient allocation of resources; and (3) insufficient support to physical infrastructure and human
capital development.
Though I agree with the above, I completely disagree with the way the article applies (or really fails to apply)
these factors to China. The article lists the following three things as most likely to derail China’s path to riches:
1. Environmental Degradation.
“These problems, if not tackled quickly, are likely to reduce life quality, hamper
productivity, drive away investment and, eventually, dim China’s growth outlook.”
2. Increasing Cost of State-Owned-Enterprises. ”SOEs may also contribute to fiscal risks, as both the state
sector and local governments continue to face soft budget constraints, and become a source of social tension.”
3. Financial Crisis. ”It remains an open question if China’s banks and its financial system more generally could
withstand the shocks likely brought about by financial liberalization and opening.”
I minimize all three of these. Both Environmental degradation and the cost of SOEs can be overcome and even if
that does not happen, I do not see those failures as enough to prevent China from becoming a wealthy nation. Any
financial crisis will have a short-term impact.
No, at this point, what I see holding China back from developed status are far more systemic. I simply have
doubts as to whether China can innovate enough to move from a country based on heavy industry for others to
a country that innovates sufficiently to develop big time products/services/ideas so as to make China a 21st
century economic powerhouse. I also am skeptical of its ability/desire to substantially improve the living
standards of more than half of its poorest 900 million.
For more on China’s chances of escaping the Middle Income Trap, check out the following:
Will China Escape The Middle Income Trap?
China, Malaysia, Korea And The “Middle Income Trap.”
Diversity Is Strength. Where’s China?
What do you think?
Don’t miss a thing with Youku’s new scanner app (Youku Buzz)
Posted on Feb 25, 2013 by eumhoefer
http://buzz.youku.com/?p=1903
Running out the door but can’t tear yourself away from the latest episode of your favorite series? Thanks to a new
application from Youku, you don’t have to decide between being on time and finding out how it ends. Just grab
your mobile phone or tablet camera and scan the QR code provided in the interactive on-screen menu – Youku will
transfer the video to your device and it’ll start playing exactly where you left off. So head for the subway or the
street and don’t miss a thing along the way. You can even use the code to send the video to your friends via SMS,
email, or microblog. Not all videos are enabled with this app yet, but much of Youku’s incredible library of movies
and TV series is ready and waiting to be scanned. Yet another reason why the world is watching Youku.
The Difficulty of Figuring Out Who Owns What in China (theatlantic.com)
FEB 25 2013
http://www.theatlantic.com/international/archive/2013/02/the-difficulty-of-figuring-out-who-owns-what-in-chi
na/273466/
How a seemingly-obscure clerical matter could sink the country's real estate market.
Over the last few days, new regulations on China's real estate information system have provoked another wave
of anti-corruption sentiment. According to the Southern Metropolis Daily (@南方都市报), the government of
Zhangzhou City, Fujian Province instituted a regulation on February 16 restricting access to the
government-maintained real estate information system. The regulation prohibits searches for information about
real estate ownership, unless the search is requested by the property owners themselves or law-enforcement
agencies. Furthermore, searching may only be done using real estate registration numbers or addresses. In short,
it has become tremendously difficult to discover how many apartments a person owns by using the official system.
A similar regulation was also instituted recently in Yancheng City in Jiangsu Province.
Although the news instantly went viral in public Internet forums, follow-up reports from the Oriental Morning Post
(@东方早报) show that in most cities, including Beijing, Shanghai and Guangzhou, it has long been impossible to
conduct name searches in real estate information systems. The newly released regulations in these two cities only
institutionalized a ban that was already an unwritten rule in some places.
Nevertheless, despite its practical insignificance, the news is symbolically important, and has led to a heated
debate. At its core, the debate was not about real estate alone, but the fight against corruption, one of the most
complicated factors in China's state-society relationship.
As suggested in the statement released by the Yancheng City government, the new regulation was meant to
address citizens' desire to protect their privacy. The regulation is indeed in line with standard practices in Western
countries, where individuals are barred from searching for information about others' assets through official
systems. According to the government, the new measure is a legitimate way to enhance protection of personal
privacy.
In contrast, Web users saw the policy in a different light. They believed that instead of protecting ordinary citizens,
the measure primarily benefited corrupt officials. @险峰飞渡, a user of Sina Weibo, China's Twitter, explained how
this was the case: "Obviously, this ban has been proposed in the name of protecting citizens' privacy in order to
buy more time for officials to conceal their illegitimate assets. You can tell they are really afraid. Also, the ban
shows that bureaucrats have already formed a class of solidarity, taking advantage of a variety of policy tools to
defend their collective interests. This is really serious. If all of your income is legal, why are you afraid of a search
by name?"
In an opinion poll conducted by Sina, 87.7% of participants opposed the ban. The sharp contrast between the
government's justification of the ban and Web users' objection to it mirrored the public's long-standing mistrust
of the state, but was also exacerbated by the circumstances under which the regulation was put forward.
The last several months have seen many grassroots anti-corruption campaigns online. Officials and their relatives
whose real estate assets apparently exceeded what their legal income could conceivably acquire were variously
called "house uncle," "house sister," "house wife" and "house grandpa" by Web users as they were identified and
condemned. In most cases, the government caved to public pressure and investigated these individuals. Multiple
officials have been removed and legal processes against them have begun. In the absence of effective top-down
supervision and limited opportunities for political participation, many regard online sleuthing as a last resort for
citizens who want to oversee their civil servants.
Even though it remains unclear how many of these cases began with use of the official information system, many
Web users believe that the new prohibitions are intended to counter the burgeoning sleuthing movement.
Netizens perceive policymakers' denial of this connection as nothing more than a lie.
Online suspicion of the policy is rooted in recent developments. After the 18th National Party Congress last
November, the new Party leaders took a firm stance against corruption on various occasions. Rumors later
abounded that the real estate information system, currently run by local governments independently, would soon
be integrated into a nationwide network, making officials subject to more centralized top-down scrutiny.
As a result, fear rapidly spread among officials. As reported by Economic Observer (@经济观察报), bureaucrats in
major cities have been furiously selling off luxurious real estate properties since last December. By January 19,
when Economic Observer published the news, the Commission for Discipline Inspection of the Central Committee
of the CPC had talked to more than 120 officers, asking their relatives to stop selling real estate and closing certain
relatives' banking accounts. Given this information, the public cannot but assume that officials devised the policy
solely to secure their assets and careers, using the protection of personal privacy as an excuse.
In an editorial published on February 19, Global Times (@环球时报) argued that the ongoing debate reflects a
contradiction between two incompatible goals. According to the editorial, because of their strong contempt for
corruption, a great many people irrationally support fighting against corruption in whatever ways might
work--even if it means sacrificing privacy, which is a basic human right.
But Global Times seriously misinterpreted Web users' main argument. They are not prioritizing the cause of
anti-corruption over the protection of privacy . Instead, they do not believe the ban is meant to protect personal
privacy at all. For them, in an environment of selective law enforcement, administrators and law enforcement
officers would only enforce rules and regulations that benefit themselves. Deeply mistrusting the government,
Chinese citizens think that discourse on privacy protection only serves to mask bureaucrats' self-interest.
The fact that Western Countries have a comprehensive information disclosure system for officials' assets and
effective protection of citizens' personal privacy proves that fighting against corruption and privacy protection are
in fact compatible. The two goals could be achieved at the same time, but only if the state were dedicated to both.
The Beijing Youth Daily (@北京青年报) points out that the existence of an information disclosure system for
officials' assets is a precondition for public support of privacy protection regulations.
What annoys Web users is the very different level of dedication the state shows to the two causes. The
government tends to ignore any voice demanding information about officials' assets, yet is quite devoted to the
protection of privacy. As @ -李凤仪- wrote, "The government processes issues at two speeds. On things like
disclosing officials' assets, they move like turtles, procrastinating as much as possible and pretending they are
deaf. But on things like banning search by name and protecting corruption, they act as quickly as possible."
The snafu over real-estate searches has exposed the continuing gap between Chinese society and the state. In
some ways, China is falling into the "Tacitus Trap": when a government loses credibility, it will be perceived as
dissimulating whether or not it is telling the truth. Nefarious motives will be read into its every move. These
conditions in turn act as a deterrent for any progressive interaction between state and society, and create a
dilemma that may cast a shadow over China's public sphere for some time to come.
China flash PMI: reasons to be down, reasons to be cheerful (The FT Beyond
BRICs Blog)
Feb 25, 2013
by Rob Minto
http://blogs.ft.com/beyond-brics/2013/02/25/china-flash-pmi-reasons-to-be-down-reasons-to-be-cheerful/#a
xzz2Lr7423mZ
What to make of Monday’s China flash purchasing managers index from HSBC, given the distorting impact of the
Chinese New Year holiday?
With a reading of 50.4 (just above the 50 threshold that separates contraction and expansion), there’s something
in it for bulls and bears alike.
The February mark is a dip from January’s 52.3, and the lowest reading for four months (see chart). The new
export orders sub-index was 49.8 – below the 50-mark, showing that China’s exports are still on the softer side.
On the other hand, the overall PMI mark is still in positive territory, having struggled to break 50 for most of 2012.
And then there’s the unknown effect of Chinese New Year – this year it was in February, whereas in 2012 in was
January. The New Year break distorts production patterns and makes reading the monthly economic data rather
tricky. Essentially, the lower February score may just be a temporary pause – in which case, the 2013 recovery
may still be on track.
(See Chart)
Source: HSBC
Hongbin Qu, HSBC’s Chief Economist for China said in the note:
The Chinese economy is still on track for a gradual recovery. Despite the moderation of February’s flash PMI, the
index recorded the fourth consecutive reading above the 50 critical line. The underlying strength of Chinese
growth recovery remains intact, as indicated by the still expanding employment and the recent pick-up of credit
growth.
The flash PMI is an early reading of the index, based on over 80 per cent of the survey responses. It can differ from
the final reading, but is a reasonable indicator of Chinese manufacturing.
Chart of the week: the ups and down of Chinese property stocks (The FT Beyond
BRICs Blog)
Feb 25, 2013
by Stefan Wagstyl
http://blogs.ft.com/beyond-brics/2013/02/25/chart-of-the-week-the-ups-and-down-of-chinese-property-stock
s/#axzz2Lr7423mZ
With premier Wen Jiabao calling for new curbs on house prices, it was no surprise that last week was bad for
Chinese property stocks.
The sector fell about 6 per cent on the week, dragging the Shanghai equity market down by nearly 5 per cent in
its biggest drop in nearly two years. But, as the charts after the break show, Chinese property companies have
weathered the post-2007 global turmoil pretty well, outperforming the overall Chinese equity market.
(See Chart)
The chart above shows last week’s sudden drop, in which property, construction and materials companies figured
prominently. For example, Anhui Chaodong Cement dropped 17.7 per cent and Gemdale, a leading real estate
developer, lost 12.7 per cent. (The Shanghai market was slightly up on Monday, at the time of writing, making
little change to last week’s picture.)
But stand back and look at the property sector in the context of the rally that we have seen in emerging equity
markets, including China, since last autumn:
(See Chart)
The property sector, fuelled by hopes of economic growth and increasing stability in financial markets, has led the
way for Chinese stocks. And if you take a longer view and go back to the pre-crisis months of early 2008, you can
see that over the past five years, property stocks have done considerably better than the rest of the market:
(See Chart)
Of course, property stock investors, are still nursing heavy losses compared to pre-crisis levels, but they’re
smaller than the losses of shareholders in other companies.
What conclusions follow? First, equity investors don’t see any sign of the coming Chinese property crash so often
predicted by China bears. The sceptics might retort that this is normal – there is no reason to expect equity
investors to be ahead of other investors in spotting the disaster that is allegedly going to strike. But the sceptics
have been saying this for five years and more, in some cases.
Next, equity investors clearly have considerable faith in the authorities’ capacity to keep the property market
afloat even as Beijing tries to curb what they see as excessive price rises.
On this, the jury is out. Friday’s official figures, showed home prices rose in Beijing by 3.3 per cent compared to
January 2012, much faster than December’s 1.6 per cent increase. Shanghai prices were up 1.3 per cent, after a
flat December.
The National Bureau of Statistics (NBS) stopped publishing national price increases two years ago, but an index
independently produced by Reuters from NBS data showed that prices rose by an average of 0.7 per cent in
January compared to December, after a 0.4 per cent rise in December. Economists predict a 7 per cent national
price increase in 2013, with another 5 per cent in 2014.
If they’re right there may not be a lot to worry about. But markets rarely move in such smoothly predictable ways.
The Chinese leadership is about to change, with new men taking over from premier Wen and his government. The
new team is widely expected to prefer steady change to radical upheaval in policymaking.
But they will face conflicting pressures. Rich Chinese with money in the markets, will want rising prices; but
poorer people, desperate to climb the first rung of the housing ladder, will want the opposite.
China: web games company tests the water for US float (The FT Beyond BRICs
Blog)
Feb 25, 2013
by Chris Wright
http://blogs.ft.com/beyond-brics/2013/02/25/china-web-games-company-tests-the-water-for-us-float/#axzz2
Lr7423mZ
A web games company is about to test the appetite for Chinese floats in the US in one of the first such deals since
the accounting scandals that rocked many Chinese companies in 2011.
7Road.com is the games subsidiary of Changyou.com, a Chinese online game developer that in turn is
majority-owned by Nasdaq-listed Sohu.com.
While an application for a Nasdaq IPO is not yet publicly filed, it is described by bankers as “potentially imminent”.
One said: ” You’ll have noticed the current volatility in markets, and like all these things there’s a reserve price in
the minds of sellers and they need to be comfortable with valuations. But it’s at a pretty advanced state of
preparation.”
The deal is unlikely to be large – “early triple digits,” according to the banker, meaning something in the range of
$100m-$400m.
But it is significant in being a rare attempt to bring a Chinese company to a north American listing since the
accounting scandals around Sino-Forest, a Toronto-listed Chinese company, and others in 2011. In 2012 only two
Chinese companies were listed in the US, Vipshop and YY.
However, both of those deals have performed extremely well, suggesting there may be selective appetite for
more listings.
The banker said: “There is not a broad market for it. But it is hugely advantageous in this situation that you are
talking about a carve-out from an existing public company, which to an extent is going to mitigate any greenfield
governance concerns.”
He added: “But I’m not going to pretend that the market for early-stage TMT China companies in North America
is a straightforward one. The accounting firm inquiries, SEC litigation, the Muddy Waters instances [a reference to
a fund management company which has alleged many accounting irregularities in Chinese companies] – all of the
above have contributed to a pretty tough operating environment for those types of deals.”
The point about the carve-out is likely to be crucial. Sohu.com is widely held by major institutions including
Wellington, Handelsbanken, Fidelity and Invesco, which may give investors comfort in investing in a subsidiary.
Citigroup and Credit Suisse are managing the IPO.
China’s Tencent to Open Office in US Devoted to WeChat App (techinasia.com)
Feb 25, 2013
by Steven Millward
http://www.techinasia.com/tencent-will-open-america-office-wechat/
Tencent (HKG:0700), makers of the popular WeChat messaging app, is to open an office in America this year as
the Chinese company focuses on taking WeChat global. This was confirmed by Tencent corporate development
group vice president Zhang Xiaolong in an email to employees this morning and which was seen by Caijing.
The paper says that the new US branch will be a customer relations department for WeChat, which has over 300
million users.
WeChat – known as Weixin to Chinese users – first went global in April 2012 when the English branding was
created. As you can see in the graph below, that seems to have accelerated WeChat’s growth even further, though
Tencent has never released figures for the numbers of overseas users. However, Justin Sun, director of
international WeChat operations at Tencent, told us last year that WeChat is seeing a growing ratio of overseas
users and is proving to be a hit in Southeast Asia, America, and across the Middle East.
Tencent already has offices for its gaming operations in San Francisco; it’s not clear if the new office will be nearby
– or precisely when it’ll open. We’ve reached out to Tencent at Shenzhen HQ and will update if we hear back
[UPDATED:] who tell us: “We recently put together a small project team for WeChat to study the US market and
explore future potential opportunities.”
WeChat is up against established messaging apps like Whatsapp, as well as a host of innovative Asian-made rivals.
Aside from messaging, WeChat has a feature called Moments that allows users to share albums of photos and
other things, making it a challenger to Path and Facebook as well. The biggest rival app out of Asia is NHN Japan’s
Line app, which is also expanding aggressively into overseas markets.
Here’s WeChat’s growth in users thus far:
(See Chart)
Why the WeChat vs. Weibo War Will Be the Year’s Biggest Story, and Why Weibo
Needs to Win (techinasia.com)
Feb 25, 2013
by C. Custer
http://www.techinasia.com/wechat-weibo-war-years-biggest-story-weibo-win/
When it comes to Chinese social media, it’s increasingly clear that there are two real players: Sina Weibo and
Tencent’s WeChat. Oh, sure, there are others, but they’re all a bit passé these days. Renren and the other
traditional social media networks are starting to look very outdated. Tencent Weibo and other microblogging
competitors may have big user numbers, but there’s a reason that the big stories always break on Sina Weibo.
And while some Chinese BBS forums still boast massive user numbers, they appeal to a limited demographic —
chances are your grandmother is never going on Tianya.
So it’s down to WeChat and Sina Weibo for the crown of who’s the coolest and who can grow the fastest. Outside
China, WeChat has already won that race, and Sina isn’t even attempting to attract non-Chinese users to its weibo
service. But inside China, Weibo boasts an intimidating 500 million users (although most of them aren’t active).
WeChat broke 300 million users last month, and although not all of those users are in China, the service is growing
fast and poised to overtake Weibo within the next few years.
If you’re not a shareholder in Tencent or Sina or a Chinese social media user, it might seem like this doesn’t really
matter. But because the services themselves are so different, who wins the Weibo vs. WeChat war could have a
significant impact on Chinese society.
As weibo has grown over the past several years, it has also made a dramatic impact on Chinese civil society and
politics. Information spreads very quickly on microblogging services, and because of this Weibo has put a
spotlight on social issues from censorship to corruption to environmental problems. I would argue that Weibo has
quite literally redefined the way many users think about China, as it has taken what were previously understood
to be “local” problems and demonstrated them to be national ones.
Five years ago, for example, you might think that the pollution of a local river was just a problem with a nearby
factory, but thanks to Deng Fei’s weibo campaign and others, it’s easy to see on Weibo that many rivers
nationwide have similar problems. So, what you previously considered a local problem is now a national one, and
when that happens, you’re more likely to try to push for national changes instead of just complaining about your
local authorities.
The access Weibo grants to unfiltered information (if you check it fast enough) from across the country instantly
has already changed Chinese society, forcing both companies and governments to be more transparent, more
responsive, and more willing to interact with the people they affect. Obviously, Weibo hasn’t transformed China
into a representative democracy or anything, and there are plenty of problems with the service itself (starting with
its draconian censorship practices, though they’re often circumventable). But even so, I think Chinese society is
better off with Weibo than without it.
That’s why Weibo’s fight with WeChat is so crucial. WeChat is a totally different service with a very different focus,
but the more time users spend on WeChat, the less they’re spending on Weibo. And while chatting with your
friends and following celebrities is fun, the service just isn’t designed for the swift passing-along of information the
way that weibo is. WeChat’s focus is your circle of friends and your local area, Weibo’s focus is far wider. To return
to our polluted river analogy, on Weibo you share your photos of the river with your followers all over the country,
and they pass it on to theirs; quickly, it can go national. But on WeChat, you bitch with your friends and coworkers
about the river and it stays in your (mostly) local social circles. Even if it does spread, that spread isn’t easily
visible or trackable, which makes it seem like fewer people are talking about it and thus reduces its impact.
WeChat is still an evolving service, and obviously there are ways of using it to move information quickly and
distribute it widely (for example, getting a celebrity to share a message with all of their followers). But because
it’s simply not designed for this kind of information sharing, I fear that the social impact that Weibo has had —
which in my opinion has been mostly positive — could be undone if Chinese social networking users start spending
their social time on WeChat instead of Weibo.
Unfortunately, things are already looking grim, and even Sina has admitted it faces a stiff challenge in WeChat.
2013 looks to be WeChat’s year, but I hope that it doesn’t come at the expense of Weibo and the impact it has had
on Chinese civil society.
Quick profile of China's 564 million netizens across digital, social, mobile.
(resonancechina.com)
On February 25, 2013
http://www.resonancechina.com/2013/02/25/quick-profile-of-chinas-564-million-netizens-across-digital-social
-mobile/
(See Infographic in Chinese)
By the end of 2012, the number of China netizen has reached 564 million, and the number of people who access
the internet through mobile phones hit 420 million, which was 64.4 million more than that number at the end of
2011. Mobile users accounts for 74.5% of the total netizen population, and it is the first time that the number of
people using mobile phones to access internet exceeds the number of people access internet using PCs. (PC users
accounts for 70.6% of the netizens)
The general income level of China netizens is not high as people who earn less than 3000 RMB per month accounts
for 57% of the total and there is only 10.3% of the total netizens that earn over 5000 RMB per month ( by
Tencent )
As of the end of December 2012, the number of Chinese netizens reached 564 million. Phone netizens 4.2 billion,
compared with an increase of 6440 people by the end of 2011. Proportion (70.6%) proportion of Internet users
in the use of mobile Internet users by the end of 2011, 69.3% to 74.5%, over the use of desktop computers
Internet
Chinese Internet users overall low income levels, accounting for 57% of the monthly income of 3,000 yuan, more
than the monthly income of 5,000 yuan accounted for only 10.3%. ( Artesyn Technologies )
Foxconn
On
Menu
To
(chinasourcingnews.com)
Manufacture
Vizio's
Next
Smartphone
February 26, 2013 | By Editorial Staff
http://www.chinasourcingnews.com/2013/02/26/564703-foxconn-on-menu-to-manufacture-vizios-next-smart
phone/
Taiwanese OEM Foxconn may produce the first smartphone product for Vizio, an American LCD HDTV provider, in
2013.
According to reports in Taiwanese local media, the development of this new product will expand the cooperation
between Foxconn and Vizio, and the new product is expected to launch in the Chinese market in 2013. Fujiconn,
a subsidiary of Foxconn, will be responsible for the production of the smartphone. Prior to this, Vizio cooperated
with Foxconn in the launch of 60-inch and 70-inch large TVs in the U.S. in November and December 2012,
respectively.
In 2012, Vizio achieved operating revenue of NTD75 billion, which was about USD2.54 billion. The company plans
to increase its TV shipments to seven million units in 2013. Vizio said that Vizio's cooperation with Foxconn has
been successful and they worked together to turn large-screen TVs from concept to reality in only three months.
At present, Vizio has over 60% share of the above 60-inch TV market in North America. It predicted that its TV
shipments in 2013 will be over seven million units and its operating revenue will reach over NTD100 billion.
Meanwhile, Foxconn predicted that its total operating revenue will be NTD4 trillion in 2013.
Politics & Law
Newswire
Chinese Hackers Seen as Increasingly Professional (The Associated Press)
By AP / CHRISTOPHER BODEENFeb. 25, 2013
http://world.time.com/2013/02/25/chinese-hackers-seen-as-increasingly-professional/
(BEIJING) — Beijing hotly denies accusations of official involvement in massive cyberattacks against foreign
targets, insinuating such activity is the work of rogues. But at least one element cited by Internet experts points
to professional cyberspies: China‘s hackers take the weekend off.
Accusations of state-sanctioned hacking took center stage this past week following a detailed report by a
U.S.-based Internet security firm Mandiant. It added to growing suspicions that the Chinese military is not only
stealing national defense secrets and harassing dissidents but also pilfering information from foreign companies
that could be worth millions or even billions of dollars.
Experts say Chinese hacking attacks are characterized not only by their brazenness, but by their persistence.
“China conducts at least an order of magnitude more than the next country,” said Martin Libicki, a specialist on
cyber warfare at the Rand Corporation, based in Santa Monica, California. The fact that hackers take weekends off
suggests they are paid, and that would belie “the notion that the hackers are private,” he said.
Libicki and other cyber warfare experts have long noted a Monday-through-Friday pattern in the intensity of
attacks believed to come from Chinese sources, though there has been little evidence released publicly directly
linking the Chinese military to the attacks.
Mandiant went a step further in its report Tuesday saying that it had traced hacking activities against 141 foreign
entities in the U.S. Canada, Britain and elsewhere to a group of operators known as the “Comment Crew” or
“APT1,” for “Advanced Persistent Threat 1,” which it traced back to the People’s Liberation Army Unit 61398. The
unit is headquartered in a nondescript 12-story building inside a military compound in a crowded suburb of
China’s financial hub of Shanghai.
Attackers stole information about pricing, contract negotiations, manufacturing, product testing and corporate
acquisitions, the company said.
Hacker teams regularly began work, for the most part, at 8 a.m. Beijing time. Usually they continued for a
standard work day, but sometimes the hacking persisted until midnight. Occasionally, the attacks stopped for
two-week periods, Mandiant said, though the reason was not clear.
China denies any official involvement, calling such accusations “groundless” and insisting that Beijing is itself a
major victim of hacking attacks, the largest number of which originate in the U.S. While not denying hacking
attacks originated in China, Foreign Ministry spokesman Hong Lei said Thursday that it was flat out wrong to
accuse the Chinese government or military of being behind them.
Mandiant and other experts believe Unit 61398 to be a branch of the PLA General Staff’s Third Department
responsible for collection and analysis of electronic signals such as e-mails and phone calls. It and the Fourth
Department, responsible for electronic warfare, are believed to be the PLA units mainly responsible for infiltrating
and manipulating computer networks.
China acknowledges pursuing these strategies as a key to delivering an initial blow to an opponent’s
communications and other infrastructure during wartime _ but the techniques are often the same as those used
to steal information for commercial use.
China has consistently denied state-sponsored hacking, but experts say the office hours that the cyberspies keep
point to a professional army rather than mere hobbyists or so-called “hacktivists” inspired by patriotic passions.
Mandiant noticed that pattern while monitoring attacks on the New York Times last year blamed on another
Chinese hacking group it labeled APT12. Hacker activity began at around 8:00 a.m. Beijing time and usually lasted
through a standard workday.
The Rand Corporation’s Libicki said he wasn’t aware of any comprehensive studies, but that in such cases, most
activity between malware embedded in a compromised system and the malware’s controllers takes place during
business hours in Beijing’s time zone.
Richard Forno, director of the University of Maryland Baltimore County’s graduate cybersecurity program, and
David Clemente, a cybersecurity expert with independent analysis center Chatham House in London, said that
observation has been widely noted among cybersecurity specialists.
“It would reflect the idea that this is becoming a more routine activity and that they are quite methodical,”
Clemente said.
The PLA’s Third Department is brimming with resources, according to studies commissioned by the U.S.
government, with 12 operation bureaus, three research institutes, and an estimated 13,000 linguists, technicians
and researchers on staff. It’s further reinforced by technical teams from China’s seven military regions spread
across the country, and by the military’s vast academic resources, especially the PLA University of Information
Engineering and the Academy of Military Sciences.
The PLA is believed to have made cyber warfare a key priority in its war-fighting capabilities more than a decade
ago. Among the few public announcements of its development came in a May 25, 2011 news conference by
Defense Ministry spokesman Geng Yansheng, in which he spoke of developing China’s “online” army.
“Currently, China’s network protection is comparatively weak,” Geng told reporters, adding that enhancing
information technology and “strengthening network security protection are important components of military
training for an army.”
Unit 61398 is considered just one of many such units under the Third Department responsible for hacking,
according to experts.
Greg Walton, a cyber-security researcher who has tracked Chinese hacking campaigns, said he’s observed the
“Comment Crew” at work, but cites as equally active another Third Department unit operating out of the
southwestern city of Chengdu. It is tasked with stealing secrets from Indian government security agencies and
think tanks, together with the India-based Tibetan Government in Exile, Walton said.
Another hacking outfit believed by some to have PLA links, the “Elderwood Group,” has targeted defense
contractors, human rights groups, non-governmental organizations, and service providers, according to
computer security company Symantec.
It’s believed to have compromised Amnesty International’s Hong Kong website in May 2012, although other
attacks have gone after targets as diverse as the Council on Foreign Relations and Capstone Turbine Corporation,
which makes gas microturbines for power plants.
Civilian departments believed to be involved in hacking include those under the Ministry of Public Security, which
commands the police, and the Ministry of State Security, one of the leading clandestine intelligence agencies. The
MSS is especially suspected in attacks on foreign academics studying Chinese social issues and unrest in the
western regions of Tibet and Xinjiang.
Below them on the hacking hierarchy are private actors, including civilian universities and research institutes,
state industries in key sectors such as information technology and resources, and college students and other
individuals acting alone or in groups, according to analysts, University of Maryland’s Forno said.
China’s government isn’t alone in being accused of cyber espionage, but observers say it has outpaced its rivals
in using military assets to steal commercial secrets.
“Stealing secrets is stealing secrets regardless of the medium,” Forno said. “The key difference is that you can’t
easily arrest such electronic thieves since they’re most likely not even in the country, which differs from how the
game was played during the Cold War.”
BBC says radio broadcasts being jammed in China (Reuters)
LONDON | Mon Feb 25, 2013
http://www.reuters.com/article/2013/02/25/us-britain-bbc-china-idUSBRE91O0OE20130225
(Reuters) - Radio broadcasts in English from the BBC World Service are being jammed in China, the British
broadcaster said on Monday, suggesting the Chinese authorities were behind the disruption.
"The BBC strongly condemns this action which is designed to disrupt audiences' free access to news and
information," the BBC said in a statement.
China, which enforces strict restrictions on its domestic media, has been accused by several prominent foreign
media of seeking to stop their news reports reaching Chinese audiences.
"The BBC has received reports that World Service English shortwave frequencies are being jammed in China," said
the London-based public service broadcaster.
"Though it is not possible at this stage to attribute the source of the jamming definitively, the extensive and
coordinated efforts are indicative of a well-resourced country such as China."
A duty officer at China's foreign ministry had no immediate comment.
It was not the first time the BBC had complained of disruption to its services in China, where its website has been
consistently blocked.
Last year, it accused the Chinese authorities of jamming its BBC World News TV channel when it broadcast stories
regarded as sensitive, such as reports on dissident Chen Guangcheng, who escaped from house arrest and sought
refuge in the U.S. embassy.
Other foreign broadcasters including U.S. state-funded radio stations Voice of America and Radio Free Asia have
also complained of Beijing blocking access to their programs.
The New York Times reported on January 30 that Chinese hackers had been attacking its computer systems while
it was working on an investigative report in October last year on the fortune accumulated by relatives of outgoing
Premier Wen Jiabao.
The BBC said in its statement on Monday that it had experienced jamming of satellite broadcasts over the past two
years, and that while shortwave jamming was generally less frequent, it did also affect Persian-language
transmissions in Iran.
"The jamming of shortwave transmissions is being timed to cause maximum disruption to BBC World Service
English broadcasts in China," said Peter Horrocks, director of BBC Global News.
"The deliberate and coordinated efforts by authorities in countries such as China and Iran illustrate the
significance and importance of the role the BBC undertakes to provide impartial and accurate information to
audiences around the world."
China is listed at number 173 out of 179 countries on the World Press Freedom Index compiled by campaign group
Reporters Without Borders.
(Reporting By Estelle Shirbon; Additional reporting by Lucy Hornby; Editing by Tom Pfeiffer)
Print
America's two-faced tirade against Chinese 'cyberwar' (South China Morning
Post)
Alex Lo
alex.lo@scmp.com
http://www.scmp.com/comment/insight-opinion/article/1158588/americas-two-faced-tirade-against-chinese-c
yberwar
Hey, kettle. It's pot here, calling to denounce you with evidence you are undermining world peace.
The Obama administration is planning to confront the new leadership in Beijing, according to The New York Times,
over the cyberwarfare that the Chinese state is allegedly waging against America and its top corporations.
The evidence? A dubious report by commercial internet security firm Mandiant - which was not peer-reviewed by
any independent experts - and which has generated so much free publicity for them by accusing China of being
the world's worst cyber-rogue state.
According to the company and now the White House, almost every item on a lengthy, confidential list of IP
addresses - linked to a hacking group that has stolen terabytes of data from US corporations - could be traced to
a neighbourhood in Shanghai that hosts the Chinese military's cybercommand. Even Hong Kong's own University
of Science and Technology reportedly had a few addresses on the list.
These attacks were presented as sophisticated and state-sponsored. But how sophisticated?
Strangely, these master hackers from China all forgot to hide their internet traces. In fact, they did the opposite:
they left their fingerprints all over the crime scene so it could all be traced back to a single People's Liberation
Army source in Shanghai! Just how smart could these guys be?
Or perhaps they weren't the real perpetrators. Presumably, any self-respecting hacker or cybercriminal worth his
salt would plant false leads and hide tracks so his crime can't be traced back to him. Who would leave behind a
long list of IP addresses to implicate himself and pinpoint his location to a single postal address?
To date, the only confirmed act of state-sponsored cyberwarfare has been by the United States and its closest ally,
Israel, against Iran's nuclear weapons programme.
Like nuclear weapons (with the Soviets) and weapons of mass destruction (with Iraq), an enemy is needed before
Washington can legitimise the development of new military capability or go to war … or launch drone
assassinations - oh, sorry, I meant targeted killings - that have caused thousands of deaths, many of them
innocent bystanders, in Yemen, Pakistan and Somalia.
Which is the rogue state?
China-Japan dispute a powder keg, says US (The Australian)
BY:GREG SHERIDAN, FOREIGN EDITOR
February 26, 2013
http://www.theaustralian.com.au/national-affairs/foreign-affairs/china-japan-dispute-a-powder-keg-says-us/st
ory-fn59nm2j-1226585443640
THE territorial dispute over the small Senkaku island chain between Japan and China is a "powder keg", according
to the outgoing US assistant secretary of state for East Asia, Kurt Campbell.
Mr Campbell linked the dispute to what he described as an increasingly difficult and dangerous environment for
Australia, and the need for Canberra to maintain a realistic level of defence spending.
"In four years as assistant secretary I've faced many difficult diplomatic situations," Mr Campbell said in an
exclusive interview with The Australian, "but none more difficult than this.
"I've rarely seen diplomats on both sides (Japan and China) more white-knuckled, and on both sides the sense
that no retreat or compromise is possible."
Japan and China both claim sovereignty over the Senkaku islands and in recent weeks have come close to military
clashes at sea.
Last week Japan's Prime Minister Shinzo Abe accused Beijing of having a "deeply ingrained" need to quarrel with
its neighbours over territory in order to stir up domestic support.
Mr Abe also said his top priority was "to make China realise that they would not be able to change the rules or take
away somebody's territorial water or territory by coercion or intimidation".
Mr Campbell believes the dispute is militarily dangerous: "They're comparable powers," he said.
"We worry about unpredictable and accidental events. Both nations have assets -- coastguard and military -- in
place.
"We urge both sides to get back to dialogue and discussion."
Mr Campbell said Washington did not want to act as a mediator in the dispute but was offering "some ideas and
help" to both sides.
He feared the Japan-China dispute was affecting the economies of both nations, and could spill over into concerns
about shipping safety in surrounding waters.
Northeast Asia, he said, was now the "cockpit of the global economy" and this status was based on a sense of
goodwill and compromise between Tokyo and Beijing.
Mr Campbell finished up as assistant secretary on February 8 and has now founded a private firm, the Asia Group,
as well as returning to chair the think tank he founded, the Centre for a New American Security.
He is widely regarded as the most influential assistant secretary for East Asia since the end of the Cold War.
He has been widely reported as being privately aghast at the Australian defence budget cuts.
Mr Campbell was intimately involved in US policy towards Myanmar and was a close collaborator with democracy
activist and Nobel laureate Aung San Suu Kyi, but he believes Myanmar President Thein Sein also deserves a great
deal of credit for the country's democratic reforms.
"There's no doubt Thein Sein is sincere," Mr Campbell said.
"The problem is the type of reform he's embarked on is so hard.
"It's not his sincerity I doubt, it's whether he can maintain the relentless pace."
A New Cold War, in Cyberspace, Tests U.S. Ties to China (The New York Times)
By DAVID E. SANGER
Published: February 24, 2013
http://www.nytimes.com/2013/02/25/world/asia/us-confronts-cyber-cold-war-with-china.html
WASHINGTON — When the Obama administration circulated to the nation’s Internet providers last week a lengthy
confidential list of computer addresses linked to a hacking group that has stolen terabytes of data from American
corporations, it left out one crucial fact: that nearly every one of the digital addresses could be traced to the
neighborhood in Shanghai that is headquarters to the Chinese military’s cybercommand.
That deliberate omission underscored the heightened sensitivities inside the Obama administration over just how
directly to confront China’s untested new leadership over the hacking issue, as the administration escalates
demands that China halt the state-sponsored attacks that Beijing insists it is not mounting.
The issue illustrates how different the worsening cyber-cold war between the world’s two largest economies is
from the more familiar superpower conflicts of past decades — in some ways less dangerous, in others more
complex and pernicious.
Administration officials say they are now more willing than before to call out the Chinese directly — as Attorney
General Eric H. Holder Jr. did last week in announcing a new strategy to combat theft of intellectual property. But
President Obama avoided mentioning China by name — or Russia or Iran, the other two countries the president
worries most about — when he declared in his State of the Union address that “we know foreign countries and
companies swipe our corporate secrets.” He added: “Now our enemies are also seeking the ability to sabotage our
power grid, our financial institutions and our air traffic control systems.”
Defining “enemies” in this case is not always an easy task. China is not an outright foe of the United States, the
way the Soviet Union once was; rather, China is both an economic competitor and a crucial supplier and customer.
The two countries traded $425 billion in goods last year, and China remains, despite many diplomatic tensions, a
critical financier of American debt. As Hillary Rodham Clinton put it to Australia’s prime minister in 2009 on her
way to visit China for the first time as secretary of state, “How do you deal toughly with your banker?”
In the case of the evidence that the People’s Liberation Army is probably the force behind “Comment Crew,” the
biggest of roughly 20 hacking groups that American intelligence agencies follow, the answer is that the United
States is being highly circumspect. Administration officials were perfectly happy to have Mandiant, a private
security firm, issue the report tracing the cyberattacks to the door of China’s cybercommand; American officials
said privately that they had no problems with Mandiant’s conclusions, but they did not want to say so on the
record.
That explains why China went unmentioned as the location of the suspect servers in the warning to Internet
providers. “We were told that directly embarrassing the Chinese would backfire,” one intelligence official said. “It
would only make them more defensive, and more nationalistic.”
That view is beginning to change, though. On the ABC News program “This Week” on Sunday, Representative
Mike Rogers, Republican of Michigan and chairman of the House Intelligence Committee, was asked whether he
believed that the Chinese military and civilian government were behind the economic espionage. “Beyond a
shadow of a doubt,” he replied.
In the next few months, American officials say, there will be many private warnings delivered by Washington to
Chinese leaders, including Xi Jinping, who will soon assume China’s presidency. Both Tom Donilon, the national
security adviser, and Mrs. Clinton’s successor, John Kerry, have trips to China in the offing. Those private
conversations are expected to make a case that the sheer size and sophistication of the attacks over the past few
years threaten to erode support for China among the country’s biggest allies in Washington, the American
business community.
“America’s biggest global firms have been ballast in the relationship” with China, said Kurt M. Campbell, who
recently resigned as assistant secretary of state for East Asia to start a consulting firm, the Asia Group, to manage
the prickly commercial relationships. “And now they are the ones telling the Chinese that these pernicious attacks
are undermining what has been built up over decades.”
It is too early to tell whether that appeal to China’s self-interest is getting through. Similar arguments have been
tried before, yet when one of China’s most senior military leaders visited the Joint Chiefs of Staff at the Pentagon
in May 2011, he said he didn’t know much about cyberweapons — and said the P.L.A. does not use them. In that
regard, he sounded a bit like the Obama administration, which has never discussed America’s own cyberarsenal.
Yet the P.LA.’s attacks are largely at commercial targets. It has an interest in trade secrets like aerospace designs
and wind-energy product schematics: the army is deeply invested in Chinese industry and is always seeking a
competitive advantage. And so far the attacks have been cost-free.
American officials say that must change. But the prescriptions for what to do vary greatly — from calm negotiation
to economic sanctions and talk of counterattacks led by the American military’s Cyber Command, the unit that
was deeply involved in the American and Israeli cyberattacks on Iran’s nuclear enrichment plants.
“The problem so far is that we have rhetoric and we have Cyber Command, and not much in between,” said Chris
Johnson, a 20-year veteran of the C.I.A. team that analyzed the Chinese leadership. “That’s what makes this so
difficult. It’s easy for the Chinese to deny it’s happening, to say it’s someone else, and no one wants the U.S.
government launching counterattacks.”
That marks another major difference from the dynamic of the American-Soviet nuclear rivalry. In cold war days,
deterrence was straightforward: any attack would result in a devastating counterattack, at a human cost so
horrific that neither side pulled the trigger, even during close calls like the Cuban missile crisis.
But cyberattacks are another matter. The vast majority have taken the form of criminal theft, not destruction. It
often takes weeks or months to pin down where an attack originated, because attacks are generally routed
through computer servers elsewhere to obscure their source. A series of attacks on The New York Times that
originated in China, for example, was mounted through the computer systems of unwitting American universities.
That is why David Rothkopf, the author of books about the National Security Council, wrote last week that this was
a “cool war,” not only because of the remote nature of the attacks but because “it can be conducted indefinitely
— permanently, even — without triggering a shooting war. At least, that is the theory.”
Administration officials like Robert Hormats, the under secretary of state for business and economic affairs, say
the key to success in combating cyberattacks is to emphasize to the Chinese authorities that the attacks will harm
their hopes for economic growth. “We have to make it clear,” Mr. Hormats said, “that the Chinese are not going
to get what they desire,” which he said was “investment from the cream of our technology companies, unless they
quickly get this problem under control.”
But Mr. Rogers of the Intelligence Committee argues for a more confrontational approach, including “indicting bad
actors” and denying visas to anyone believed to be involved in cyberattacks, as well as their families.
The coming debate is over whether the government should get into the business of retaliation. Already,
Washington is awash in conferences that talk about “escalation dominance” and “extended deterrence,” all
terminology drawn from the cold war.
Some of the talk is overheated, fueled by a growing cybersecurity industry and the development of offensive
cyberweapons, even though the American government has never acknowledged using them, even in the Stuxnet
attacks on Iran. But there is a serious, behind-the-scenes discussion about what kind of attack on American
infrastructure — something the Chinese hacking groups have not seriously attempted — could provoke a
president to order a counterattack.
'Second Generation Red' fall in behind Xi Jinping (The Age)
February 24, 2013
John Garnaut
China correspondent for Fairfax Media
http://www.theage.com.au/world/second-generation-red-fall-in-behind-xi-jinping-20130224-2ezdn.html#ixzz2
LnO12Rrp
Beijing: Nostalgic and disillusioned sections of the Communist Party’s "red aristocracy” have rallied strongly
behind the new leader, Xi Jinping, in gatherings over the Spring Festival break.
At the largest reunion, held on Saturday at the People’s Liberation Army’s August 1 film studio in West Beijing,
children of revolutionary leaders lauded the Xi administration for “correcting” the Party’s course at its “critical
moment of life and death”, when it was in danger of abandoning socialism altogether.
"There is hope in the snake year now the Party leadership has shown us the content and direction of Socialism
with Chinese Characteristics,” Hu Muying, the daughter of former Politburo member Hu Qiaomu, told the
gathering of about a thousand descendants of revolutionary veterans.
Mr Hu was Chairman Mao’s long time speech writer and the chief ideological authority under both Mao and his
successor as paramount leader, Deng Xiaoping.
“We shall prove by our own actions that we, the children of veterans, are indeed worthy of the name ‘Second
Generation Red’,” said Ms Hu. “Let’s strive together towards The China Dream,” she said, endorsing Mr Xi’s
political motto.
Ms Hu’s affirmation, given as President of The Fellowship of Children of Yan’an, presented a striking contrast to
previous Spring Festival gatherings where she had diagnosed social crises and ideological confusion but given no
credit to the capacity of senior Party leaders to solve the problems.
Mr Xi enjoys natural prestige among the “Second Generation Red” because he is one. His father, Xi Zhongxun,
helped establish the revolutionary bastion of Yan’an in the 1930s.
Mr Xi’s first 100 days in power, which he reached on Thursday, has been marked by high-profile campaigns
against corruption, pomp and conspicuous consumption among the Party and military elite.
He has adopted a more nationalistic and militaristic tone in pursuing territorial claims against Japan and making
repeated high-profile visits to military commands.
Less visibly, in internal speeches and oblique public references, Mr Xi has elevated the prestige and legacy of
Chairman Mao Zedong and held himself out as a leader who has the courage to fight to save the regime - in
explicit contrast to Mikhail Gorbachev in the Soviet Union.
He has simultaneously recommitted to the cause of economic reform by laying a wreath at a statue of Deng
Xiaoping, the paramount leader who succeeded Mao.
“Deng’s success was, after all, the result of his close relations with so many groups in the leadership and the party
rather than any inflexible ideological or intellectual position,” said David Goodman, academic director at the
University of Sydney’s China Studies Centre.
“Like Deng, Xi Jinping has been acceptable because so many groups, including Party conservatives like Hu Muying,
think that they have his ear,” said Professor Goodman, who has authored a book about Deng.
Mr Xi’s leaning towards the Mao-era legacy has dismayed many liberal intellectuals, particularly with December
comments in which he emphasised continuity between the early revolutionary decades under Mao and the reform
era under Deng Xiaoping.
"This is almost like overturning Deng Xiaoping’s rejection of the Cultural Revolution,” said He Weifang, a
prominent lawyer. “It seems Xi is trying to fawn over the Left while not offending the Right."
But previously outspoken liberal-leaning members of the red aristocracy have bitten their tongues.
"I don’t challenge him, openly, because I have to support him,” the son of one of the PLA’s ten great marshals,
told Fairfax Media.
“Other people who don’t belong to hongerdai [Second Generation Red] will say ‘that’s wrong’, that Xi has leftist
colour, but we don’t,” he said.
Other politically active representatives of China’s most powerful families, who hold more conservative views, are
also taking care to avoid complicating Mr Xi’s consolidation of power.
Representatives of three of China’s most powerful families, who grew up together in Zhongnanhai and are known
as strong supporters of their purged colleague Bo Xilai, all pulled out of a small annual Spring Festival on Saturday
night, according to a member of the group.
The absentees included:
·
·
·
Political
Chen Yuan, head of the China Development Bank, who is an alumni of Bo Xilai’s No. 4 Middle School;
Bo Xilai’s entrepreneurial and politically active younger brother, Bo Xicheng; and
Bo Xicheng’s former class mate General Liu Yuan, the son of former president Liu Shaoqi and now
Commissar of the PLA’s General Logistics Department.
Other supporters, however, are continuing to show support for Mr Bo including by visiting the Beijing courtyard
home of his wife, Gu Kailai, who was convicted of murdering Englishman Neil Heywood.
Wang Xuemei, a forensic expert at Supreme People’s Procuratorate who has repeatedly cast doubt on Ms Gu’s
case, spent Chinese New Year’s eve with Gu’s mother in Dongcheng district, according to Gu’s lawyer, Li Xiaolin.
Online
China Austerity Drive Becomes a Joke (THE WSJ CHINA REAL TIME REPORT
BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/china-austerity-drive-a-laughing-matter/?mod=WSJBlog
China’s leaders have been talking tough about graft, greed and gross extravagance again. One sign they’re
serious this time: Their willingness to have a little fun with it.
Up until recently, the austerity campaign was suitably severe. There was tough talk from Communist Party chief
Xi Jinping, who told a gathering of party heavyweights in November that corruption threatened their grip on power.
He called for less pomp and ceremony for officials touring the countryside and urged comrades to make do with
a little less banqueting. They should stick to four dishes and a soup and finish their food or else, he said.
Similar refrains have regularly appeared in the party mouthpiece, the People’s Daily. A recent commentary (in
Chinese) said cadres need to avoid waste, hold only meetings that have a real purpose and observe the New Year
holiday in a simple and modest fashion. “The people are looking forward to this – and they will be watching
critically,” it warned.
But to help spread the party gospel even further, Beijing recently decided to take a more populist approach —
making these themes part of the entertainment on CCTV’s widely watched Lunar New Year’s Eve gala – or the
“Chun Wan Hui.”
In one of the CCTV New Year skits, comic Guo Degang took a swipe at the ex-Shaanxi work safety official Yang
Dacai, dubbed the “Brother Watch” after photos of him appeared on the Internet sporting an array of expensive
watches that normally would exceed a government salary. Mr Guo, who didn’t mention the sacked official by name,
bragged he wore a hefty gold watch on his right wrist and a dozen more all the way up his left arm. Asked if it
wasn’t risky wearing them he said: “I’m not afraid of wearing them and I’m not afraid of letting people see them,”
he said, adding he had shortened his left suit sleeve so he could show them all off (in Chinese).
Still in character, he bragged of splashing out on a wedding banquet, inviting enough guests to fill 100 tables. He
feigned outrage at apparently being upstaged by a banquet next door with 200 tables. On closer inspection, that
banquet was paid for with public money, so it wasn’t a fair contest, he insisted.
In another sketch, TV actor Sun Tao portrayed an upright but harried building security guard who fends off a
stream of self-important people who insist they must gain access to the office building where he works, even
though they don’t have a proper ID. An exasperated Mr. Sun finally explodes in misguided anger, wrongly
accusing an official of trying to bribe him. “You think that you have power and can embezzle state money? You
think you have four ID cards so you can buy houses?”
While the accusation turns out to be misguided in this case, it is a clear allusion to House Sister — an ex-bank
official was taken into police custody after it was discovered she had bought more than 40 homes in Beijing alone,
many of them using borrowed IDs.
The antics were all CCTV make-believe but they had their serious side and they suggest that the party is aware
of public anger just below the surface. Making light of its own dismal track record on fighting corruption – on prime
time television – might convince some viewers the Communist Party is trying to address some intractable
problems.
But it remains to be seen whether this recent show of urgency lasts. If history is any guide, the commitment to
clamping down on excess could turn out to be a bit like sleeve lengths – something that can change with the
season.
– William Kazer and Olivia Geng
House Intelligence Chairman: U.S. ‘Losing’ Cyber War (THE WSJ CHINA REAL
TIME REPORT BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/house-intelligence-chairman-u-s-losing-cyber-war/?mod=WSJ
Blog
The chairman of the House Intelligence Committee said Sunday that recent reports about Chinese hacking show
the U.S. is losing a global cyber war.
Rep. Mike Rogers (R., Mich.), chairman of the House panel, slammed the Chinese military for alleged cyberattacks
on U.S. corporations and attempts to hack infrastructure facilities such as electrical power grids and other
facilities important to the U.S. security.
Mr. Rogers, speaking on ABC’s “This Week With George Stephanopoulos,” called the cyberattacks a war that “we
are losing.”
“We get [hit] every single day by a whole series … of attacks, everything from criminals trying to get into your
bank account or steal your identity, to nation states like China who are investing billions,” he said.
Asked if he believes that the Chinese government and its military are behind cyberattacks against leading U.S.
companies, Mr. Rogers said, “Beyond a shadow of a doubt.”
See more on this at Washington Wire
China, den of cannibals? (China Media Project)
By David Bandurski | Posted on 2013-02-25
http://cmp.hku.hk/2013/02/25/31460/
The trial last week of a man accused of murdering a doctor during the Cultural Revolution has generated some
interesting discussion of this sensitive episode in China’s history, both on social media and in traditional media.
Approved by the 11th Central Committee of the Chinese Communist Party in June 1981, the Resolution on Certain
Questions in the History of Our Party Since the Founding of the Republic offered a review and assessment of the
first 32 years since the founding of the People’s Republic of China. The resolution rejected the Cultural Revolution,
saying it had been “initiated in error by [Party] leaders and manipulated by counterrevolutionary cliques, bringing
grave disaster and internal chaos to the Party, the nation and our people.”
But the resolution’s formal rejection of this painful decade was not an invitation for Chinese to reflect back on its
evils and their political, cultural or institutional causes. The Cultural Revolution has remained a highly sensitive
issue ever since, and coverage by the news media is carefully controlled, particularly around the May anniversary
of its inception.
On February 20, the official China News Service reported that an elderly man in Zhejiang province, identified only
by his surname, Qiu, was facing trial for his alleged murder in 1967 of a doctor accused at the time of being a spy.
The news of Qiu’s trial generated a great deal of discussion on Chinese social media. While some Chinese
welcomed the action, many felt is was too little too late, the petty scapegoating of a helpless old man while senior
Party officials with unclean hands were shielded from responsibility.
[ABOVE: Two among many posts this week dealing with the Cultural Revolution and the recent trial of Mr. Qiu in
Zhejiang province. On top the text leads readers to an important piece by former CMP fellow Zhang Ming (SEE
BELOW), and the Sina Weibo service adds links to news about the Zhejiang case.]
One of the most important recent pieces in the traditional media came the very same day the China News Service
reported news of the Zhejiang trial. On February 20, China Youth Daily published a piece on page two by Zhang
Ming (张鸣), a former CMP fellow and a professor of political science at Renmin University of China. Zhang’s piece
argued China must reflect back openly on the Cultural Revolution if Chinese hope to regain a sense of humanity
and dignity.
[ABOVE: A re-posted version of Zhang Ming's Cultural Revolution article for China Youth Daily at Phoenix Online
drew more than 300,000 visits by February 25. The article is accompanied by an image of the victim of a Cultural
Revolution struggle session. We'll let readers parse the significance of the Buick advertisement to the right of the
coverage.]
The language of Zhang’s piece — printed in China Youth Daily‘s “speaking freely” column — is strong and direct,
not shrinking from brutal characterization of the acts committed during the Cultural Revolution.
Cannibalism is Zhang’s overarching metaphor, built atop very real (and apparently quite common) acts of human
flesh-eating that occurred during the Cultural Revolution. At one point, Zhang writes that if China cannot reflect
back, then “we are still a den of cannibals.”
Below is a partial translation of Zhang Ming’s February 20 piece.
“Without Reflection Humanity Cannot Be Recovered” (没有反思就没有人性的复苏)
China Youth Daily
February 20, 2013
By Zhang Ming (张鸣)
There are many people [in our country] who yearn for a repeat of the Cultural Revolution, for another violent
convulsion. This should send shivers through us all. If we refuse to review and reexamine the Cultural Revolution,
we might still be a society of cannibals. And if we are such a society, it doesn’t matter how bright we might seem
on the outside, or how fully we enjoy the fruits of civilisation — we are still a den of cannibals.
It has been more than 30 years since the end of the Cultural Revolution, but this [historical episode] has never
quite gone from us. In both the real and virtual worlds, those, old and young, who praise and support the Cultural
Revolution can be found everywhere. On a taxi ride recently I was talking with the elderly driver and he said with
profound hatred that if we just had another round of the Cultural Revolution officials wouldn’t be let off the hook
so easily — we would peel them alive, he said.
In official [Party] documents the Cultural Revolution has been thoroughly rejected. But remembering, recording
and reflecting back on the Cultural Revolution remains taboo. Meanwhile, praise and affirmation for the Cultural
Revolution decade [is allowed to] quietly thrive. It’s as though we’ve been able to completely dissociate the
Cultural Revolution [as officially condemned] from the events of that decade. In all of human history
encompassed by the twentieth century, spanning all nations, was there any event like our Cultural Revolution?
The only possible comparison is the Nazi period in Germany. But to this day, we have had no historical
commemoration, no reflection of the kind [Germany has had].
Looking back on that period today, the most ghastly thing was the way the Cultural Revolution trampled on
human beings and their dignity. Humiliation, physical abuse, murder, death through negligence and
maltreatment — these became like a daily meal regimen. Things worked this way during the height of chaos, and
in more or less the same way once normalcy returned.
The popular tyranny of the Cultural Revolution extended through to the public security system once it was
restored. No matter who a person was, once they entered the “police station” (局子), a beating was to be
expected, and being beaten to death was always possible.
During the Cultural Revolution, we had the Guangxi Massacre (广西大屠杀), the Dao County Massacre (道县大屠杀)
and the Daxing Massacre (大兴大屠杀). You might say those were special cases. But during struggles in many
areas is was quite common for one or the other side to use rifles, or even cannons and machine guns, for
indiscriminate slaughter.
Were any places spared the constant struggle, the popular tyranny, the death and persecution that went on
without rest over those ten years? No one, not a person, was given the slightest bit of dignity. So it was for those
in the “five black categories” (landlords, wealthy peasants, counter-revolutionaries, evildoers and rightists, and
their sons and daughters). So it was for the capitalist roaders. . . With my own eyes I saw people struck down and
beaten within an inch of their lives who had the day before murdered others with their own hands. Forced
prostration, “jet propulsion” struggle sessions [in which victims were suspended with their arms out and behind
like wings], “yin-yang head” [humiliations in which half the head was shaved clean] . . . Humiliations and abuses
like these never ceased during the ten years of the Cultural Revolution.
Some people find it strange that an adolescent girl could wield a leather belt and beat her own teacher to death.
Or that red guards could take the elderly, women and children and flog them to death, scald them to death with
boiling water, drown them in toilets, and even cut them to ribbons while they were alive. In some places, like
Guangxi province, after people were beaten to death, their hearts were eaten. In that area, eating people in this
way was actually very common!
There is only one explanation — those people who were persecuted and murdered were all class enemies. The
Cultural Revolution was a war of one class against another, and class enemies were not seen as human beings.
That meant it was reasonable and normal to kill any number of people in any way possible. The problem is that
there was no war at the time, and the time who were seen at the time as enemies were simply living their lives
with their families when they were dragged out, not offering up the least resistance. Regardless of anything else,
these were human beings. No matter what class rationalisations you us, the act of torturing and beating to death
people who offered no resistance was one that decimated the humanity of the perpetrator. No matter what the
revolutionary doctrines and justifications are, a class struggle of this kind is only ultimately violence of the strong
against the weak.
. . . In China today, the abuse of domestic cats is enough to infuriate many people. How is it possible people can
hope for a replay of the Cultural Revolution? But this desire is very real. A person can shed tears of sympathy over
a cat that has been crushed to death, but this does not deter them from wishing for another Cultural Revolution,
in which they imagine skinning those in power.
Of course, many of those who wish for another Cultural Revolution don’t really understand the true horrors of that
decade. They don’t know the real Cultural Revolution. They think the Cultural Revolution was just as leftists now
describe it, a period of great democracy in which there was struggle against pro-capitalists.
One fact cannot be denied — many Chinese, including those experienced the Cultural Revolution, have not
regained their humanity.
One researcher who studied the Guangxi Massacre thought it was very strange that of all those he interviewed
who had cannibalised others at that time none whatsoever said they regretted their actions. They all said that
back then it was a life-and-death class struggle, that those they killed might have killed them. In fact, the vast
majority of those they murdered were of the so-called “five black categories.” Even as they were killed, raped,
gang-raped, they did not put up a struggle. They were abused until death ended their suffering, and then their
hearts were eaten. If their spirits were here today, they would no doubt be surprised to find their persecutors
acting with the same stubborn sense of having been right.
It goes without saying that these people have not yet recovered their sense of humanity. Perhaps it could be said
that these self-righteous murderers are better than many of their fellows in the sense that they at least have
owned up to their deeds. Many people who committed innumerable murders have simply wiped their faces clean
and pretended nothing ever happened . . .
The world has already entered the twenty-first century. Many of those who committed acts of violence during
those years are already old and feeble. If they wish to bear their savageness with them to their graves, that is
their own choice. There are many people [in our country] who yearn for a repeat of the Cultural Revolution, for
another violent convulsion. This should send shivers through us all. If we refuse to review and reexamine the
Cultural Revolution, we might still be a society of cannibals. And if we are such a society, it doesn’t matter how
bright we might seem on the outside, or how fully we enjoy the fruits of civilisation — we are still a den of
cannibals. If having experienced the Cultural Revolution, the people of our nation do not reflect [on that episode
in our history], we will have no way of leaving this den of cannibals. Any one of us might eat others, and any one
of us might be eaten.
Over half of Chinese officials have Weibophobia (offbeatchina.com)
Alia | February 24th, 2013
http://offbeatchina.com/over-half-of-chinese-officials-have-weibophobia
Given the number of corrupt officials who were brought down by exposures on Weibo (such as Brother Watch,
House Sister, etc.), no one would doubt the importance of Weibo, China’s leading microblogging service, in
impacting China’s officialdom culture. And now the assertion is backed by data.
People’s Forum, a magazine under People’s Daily, Chinese Communist Party’s official media, did a survey among
2156 government officials across China. The results showed that over 70% supported the use of Weibo to fight
corruption (surprise, surprise). More interestingly, the survey found that more than half of government officials
have Weibophobia.
The things that Chinese officials fear the most about Weibo are:
Some particular “official in question” may bring down the overall image of all government officials as a group,
leading to negative sentiments tearing apart the society. (92.8% of respondents agree with the statement)
Privacy being exposed. Small problems being magnified. (84.2% of respondents agree with the statement)
Misinformation targeting at “the innocent.” (80.3% of respondents agree with the statement)
Judged guilty by speaking out words that express personality. (77.6% of respondents agree with the statement)
Held responsible for having no good performance on Weibo communication ( 58.3% of respondents agree with the
statement) [Some local governments in China now use Weibo, such as the number of followers, the number of
Weibo posts, etc., to evaluate officials’ performance.]
To the netizens on Weibo, Chinese officials should rightfully be afraid of Weibo. Why? Because like netizen 贵sir
commented: “They fear because none of them is clean.”“They fear because they’ve never experienced people’
s power of supervision in a democracy,” netizen 张敏编辑 went on.
Xinhua News, the official press agency of the Chinese government, also sided with the netizens: “Weibo has made
great contributions to the war against corruption. It helps to check and supervise power abuse. Officials’ fear of
Weibo is at heart a fear of their power being limited. To use power with reverence is the only way to cure
Weibophobia.”
To many Weiboers, the emergence of Weibopobia is a celebration of the power of onlookers. Netizen 老烟鬼qq
hailed: “Officials fear not law but Weibo. What a great news! Weibo has become a key weapon to supervise
power.”
(See Image)
On Weibo, activists used to say that “to be an onlooker is to be a contributor” – not everyone has the ability and
courage to expose corruption, but everyone has the power to retweet and share.
Last week, Sina announced that Weibo passed 500 million users. That is a lot of onlookers. Clicking share is like
casting a vote. Chinese netizens find their own way to get their voices heard. Take the recent case of general Luo
Yuan for instance. Top Chinese military officer Luo opened a personal Weibo account last week, with the hope to
protect the countr’s, as well as the army’s, interests on Weibo. The attempt was cruelly crashed by Weiboers who
showered him with criticism and questions about his credentials of a general and his family wealth.
In the time of Weibo, China’s Communist Party, who used to be the master of propaganda, needs to re-think how
to positively influence public opinions without being backfired, like in the case of Luo.
To rely on a social media platform to fight corruption isn’t a good thing per se for China as a country. But it’s
probably the best and the most effective tool that the Chinese people have so far.
Miscellaneous
Print
NAB opens farm gate to China (Sydney Morning Herald)
February 26, 2013
Peter Cai and Clancy Yeates
http://www.smh.com.au/business/nab-opens-farm-gate-to-china-20130225-2f1zr.html
NATIONAL Australia Bank will target the growing agricultural trade between Australia and Asia as it seeks to push
further into the world's fastest-growing region.
In a rare glimpse into the bank's Asian expansion plans, NAB's executive director finance, Mark Joiner, said the
bank was aiming to bring together Asian investors and Australian producers to develop the country's farming
sector.
While ANZ is bulking up its on-the-ground presence in Asia, NAB will shun the full-service approach, seeking to
build on its position as a key lender to Australian businesses and the biggest lender to farmers.
''With an emerging middle class [in Asia] of this size, I think soft commodities are just going to get stronger and
stronger over the next 20 or 30 years. I see that as a real growth centre,'' Mr Joiner told Fairfax Media.
Advertisement
He said Australia was well positioned to take advantage of Chinese concerns over food security, and suggested the
debate over Chinese investment in Australia had been blown out of proportion on occasions.
''Australia and New Zealand are well-regarded by the Chinese. I think they will like to find people they could
partner with, and direct investment opportunities in Australia,'' he said.
NAB is the latest of the big four to talk up its expansion plans for Asia, after Westpac opened its first Indian branch
last week.
In a further move to bolster its ties in China, NAB on Monday signed a memorandum of understanding with China
Development Bank. The agreement is intended to strengthen collaboration between the banks in capital markets,
trade finance and currency activity.
In targeting agribusiness, NAB is focusing on an industry that is tipped to be a key winner from Asia's growing
middle class. Prime Minister Julia Gillard last year said the government wanted to turn Australia into the food bowl
of Asia.
However, Chinese investment in agriculture has been embroiled in controversy, with last year's purchase of
Cubbie Station by China's Shandong Ruyi reigniting the debate over ''selling the farm''.
Mr Joiner said the debate in Australia had sometimes been blown out of proportion. ''As a nation, we are more
inclined to support it and then resist it,'' he said.
Unlike ANZ and Commonwealth Bank, NAB does not have a large physical presence in Asia. However, Mr Joiner
says the bank's strategy for Asia is centred around its ''core franchise in Australia'', serving the financing and
investment needs of its business clients.
He questioned the approach of his competitors, saying it should not be presumed that Australian banks could
provide better retail services than the existing retail banks in Asia.
For China’s Catholics, new pope is a cause for hope (THE WASHINGTON POST)
BY WILLIAM WAN
FEB 26, 2013
http://www.japantimes.co.jp/news/2013/02/26/asia-pacific/for-chinas-catholics-new-pope-is-a-cause-for-hope
/#.USvJXuteu1k
BEIJING – Of the long list of problems the next pope will inherit once the white smoke rises in Rome, few on the
diplomatic front can rival the bitter, intractable relationship between the Vatican and the Chinese government.
The two powers have long battled for control over Catholics in China, but the situation has worsened in the past
two years to the lowest point in decades. Bishops touted by the government have been excommunicated by the
pope. Meanwhile, China’s government has called the Vatican “unreasonable and rude,” and stepped up its
surveillance and detention of Catholics who remain loyal to the pope in illegal underground churches.
But even as Catholics there responded to the retirement of Pope Benedict XVI with surprise, many took note that
his successor is expected to be named within days of China’s own grand conclave next month, when a new
generation of top leaders takes control of the government.
“It’s an opportunity for the two sides to restart,” said Ren Yanli, an expert on Catholicism at the Chinese Academy
of Social Sciences in Beijing. “Both sides are new. They can move forward without historical burdens on their
shoulders.”
Even those most optimistic, however, acknowledge that any rapprochement would take much time and require a
breakthrough on the conflict at the heart of the rift: which side has final say over who gets ordained in China.
The Vatican maintains that the pope has sole authority in appointing bishops. China’s atheistic Communist Party
— long distrustful of what it considers foreign religions — insists that only China should select its church leaders.
The fight between two of the world’s most hierarchical and authority-driven powers has become so fraught that
Chinese authorities have in some cases resorted to kidnapping bishops sanctioned by Rome, according to the
Vatican, and pressuring them into laying their hands upon government-chosen bishops at their ordinations — a
move meant to lend such ceremonies legitimacy despite Vatican opposition.
To regular parishioners and priests caught in the middle, the choice comes down to obeying their earthly rulers or
their spiritual ones.
Trying to explain the toll of that struggle, one conflicted priest at a state-run church in Beijing quoted this verse
from the Bible: “No servant can serve two masters. He will either hate one and love the other, or be devoted to
one and despise the other.”
Yet that is the daily reality. He, like many Catholics from both camps, spoke on condition of anonymity, noting that
reprisals against those who question the state church have grown more frequent, especially among those
worshiping in churches that aren’t registered with the government.
Nearly half of the estimated 12 million Catholics in China are believed to attend such “underground churches” in
remote buildings or private homes, according to foreign experts. The rest worship in official, state-backed
churches overseen by a government-run body called the Chinese Catholic Patriotic Association.
In doctrine as well as tradition, the association differs little from the Vatican except for one tenet fundamental for
most Roman Catholics — the primacy of the pope. The association was established in 1957 to ensure Chinese
Catholics’ loyalty to their country rather than the Vatican, which party leaders have long seen as a potentially
meddlesome foreign influence. As a result, many Catholics, including some who serve and worship in the state
church, harbor reservations about its leadership.
“I go to the official churches to feel that link between God and me when standing in the cathedrals,” said one
23-year-old parishioner in Beijing, describing the tall Gothic architecture and votive candles missing from the
underground churches. “But I never take communion at the official churches.”
Instead, she receives the sacrament at an underground church. “That’s where I have the feeling of safety, where
I can get pure physically and spiritually.”
One convert baptized three years ago said his recent decision to stop attending official churches came down to the
preaching. State priests seemed to pick their topics carefully, avoiding subjects that could offend the government.
Christianity is about speaking God’s truth, he said. “They just glide over difficult issues.”
The rift and the constant questioning of legitimacy on both sides is one reason, many experts believe, that
Catholicism has stalled in China compared to booming Protestant faiths. The government pegs Chinese
Protestants at 18 million, but foreign analysts estimate them to number 58 million or more. Recruiting Catholic
priests in China is increasingly difficult. In the past year, at least two seminaries have closed.
What has made the current diplomatic breakdown at the end of Pope Benedict’s tenure all the more disappointing
is the momentum he began with in 2005, when both sides seemed to be inching toward compromise.
In a 2007 letter to Chinese Catholics, Benedict suggested renewing negotiations. He also promised that the
church was not looking to overthrow China’s leaders and talked of moving the Vatican’s diplomatic offices from
Taiwan to Beijing, ending a vestige from 1951 when China expelled foreign priests and cut diplomatic ties with the
church in Rome. Beijing responded with enthusiasm, sending the China Philharmonic Orchestra to play for
Benedict at the Vatican.
For China, making peace with the Vatican showed that the country was opening up to the world as it approached
the 2008 Olympics and 2010 Shanghai Expo. At stake for the Vatican was fear that the growing rift could create
a whole new separate church, like the Church of England under King Henry VIII.
After quiet negotiations, the two powers struck a tacit agreement allowing them to save face: They would ordain
only bishops acceptable to both sides.
But the informal truce was shattered without explanation just one month after the Expo ended in 2010, when
Chinese officials ordained a bishop in northeastern China without Vatican approval for the first time in four years.
Other ordinations followed. Then came reports from Catholic witnesses in those regions that papal-approved
bishops were being forced to attend the government-organized ordinations. The Vatican issued a reminder that
any bishop participating in unsanctioned ordinations could face serious sanctions.
Stories of bishops going into hiding and police standing guard outside cathedrals were reported by Catholic news
agencies in Asia. One bishop was described sobbing as authorities dragged him away to an ordination opposed by
the Vatican.
Anthony Liu Bainian, one of the most powerful leaders in the state-backed church who has been singled out for
criticism by the Vatican, blamed Rome for the broken truce. In an interview last week, he praised the pope as a
loving man but criticized the pope’s “working staff on China affairs,” saying they had “an unfriendly, even hostile
attitude toward China.”
He argued that Chinese officials warned the Vatican repeatedly about the 2010 candidate, Guo Jincai, prior to his
ordination, but he alleged that the Vatican refused to approve Guo because of his ties to the Communist Party.
“They just don’t want bishops to support socialism. They hope China becomes like Eastern Europe,” he said, in an
apparent reference to the late Pope John Paul II’s key role in ending communism in Poland.
The Vatican said it made clear its opposition in advance and called Guo’s ordination humiliating, offensive and “a
painful wound upon ecclesial communion.” The Vatican did not explain its objections, but Guo occupied a top
position in the Patriotic Association and was described by the Vatican’s Asia news agency as “pampered by the
regime.”
Many Chinese and foreign experts attribute China’s break from the Holy See to a wave of dramatically more
aggressive diplomacy by China since 2010 — fueled by a new sense of power from China’s rising economy and
military.
Last year, glimmers of hope briefly appeared when a rare candidate acceptable to both Beijing and Rome was
ordained in Shanghai. But those hopes were dashed after Bishop Thaddeus Ma Daqin stunned hundreds by
abruptly announcing at his ordination that he was dropping out of the state church. His words, captured on video,
were met with applause from the audience. Soon after, however, he was detained by authorities and stripped of
his title.
Amid the gloom, Catholics on both sides continue looking for encouraging signs. Many point to a recent article by
a high-ranking Vatican cardinal as a clear sign that Rome wants to re-engage. Acknowledging recent
“misunderstandings, accusations,” Cardinal Fernando Filoni called for the creation of a bilateral commission to
restart dialogue.
The next move, many believe, is China’s to make.
“The Vatican must always open the door to China,” because it is the pope’s job to care for his church, said Wang
Meixiu, an expert in Catholicism at a government-sponsored think tank.
Airport tantrum becomes latest symbol of arrogance and entitlement in China
(The Guardian)
Provincial mining boss suspended after surveillance video of him wrecking equipment appears on the internet
Jonathan Kaiman in Beijing
guardian.co.uk, Monday 25 February 2013
http://www.guardian.co.uk/world/2013/feb/25/airport-tantrum-arrogance-entitlement-china
Anyone could understand Yan Linkun's frustration when he was informed that he had missed his flight. But the
way Yan reacted to the news – banging on doors and smashing computers – has turned him into the latest symbol
of the entitlement and arrogance increasingly associated with China's political elite.
A surveillance video showing the mining company deputy chairman's violent tantrum at Kunming Changshui
airport, Yunnan province, went viral on Chinese microblogs after it was uploaded to the internet this weekend.
The four-minute video, captured last Tuesday morning, shows Yan standing by a check-in counter as an airport
employee informs him that he has missed his flight to Shenzhen.
Yan – who is also a member of a political advisory body in Qujing, Yunnan – responds first with incredulity, then
rage. He destroys two computers and a telephone before dismantling a free-standing poster and using its metal
frame to banged on the flight gate door. A crowd gathers, but nobody attempts to restrain him. The mining
company has suspended Yan, and the political advisory body has threatened punishment.
Since the incoming Chinese president, Xi Jinping, launched a crackdown on corruption last autumn, dozens of
officials have been exposed as crooked by the country's internet users and subsequently reprimanded. The
crackdown has done more to expose the scale of China's corruption problem than validate the high-level efforts
to tackle it.
Yan has expressed remorse for his behaviour. "My irrational actions and rudeness have caused some losses to the
airport as well as bad effects to the public, so I sincerely apologise to the airport and public," he told the airport's
deputy manager, according to the Shanghai Daily.
The tantrum is not the only incidence of high-level misbehaviour that has gripped China during the past week. The
Communist party secretary of a district bureau in Nanyang City, Henan province, drove a government car into a
cinema on Sunday morning, injuring 26 people, according the state news agency Xinhua. Eight of the injured were
hospitalised, two of whom remain in a critical condition.
The official, Liu Xianchong mistook the accelerator in his government-issued vehicle for the brake, reported
Xinhua. The report cited local police as saying that Lie had been off work for seven months because of a cerebral
infarction, a type of stroke. A special group to "handle the incident and its aftermath" was set up by the local party
committee, Xinhua said. Liu has been detained.
Last week party disciplinary authorities said a former official in Shaanxi province had been expelled from the party
for "serious wrongdoing" and "suspected crimes". Yang Dacai rose to notoriety last August after he was
photographed smiling at the scene of a road accident in which 36 people died. He became a symbol of official
corruption when further photographs appeared on the internet of him wearing a number of luxury watches that
many in China believe he could not possibly afford on a public servant's salary.
Online
DIY Dialysis; In China,
(thedailybeast.com)
desperate
patients
are
forced
to
innovate.
Feb 25, 2013
http://www.thedailybeast.com/newsweek/2013/02/25/d-i-y-dialysis-for-some-chinese-good-medical-care-is-el
usive.html
Seven years ago, a 25-year-old Chinese man name Fu Xuepeng was severely injured in a motorbike accident:
paralyzed from the neck down, he was unable to breathe unaided. His family rushed him to Taizhou First People’s
Hospital, where he was kept on a ventilator for four months. But the money soon ran out. Unable to pay their son’s
$1,600-a-week medical bill, the family had no choice but to bring him home. The solution to this desperate
situation? They bought an emergency, hand-powered ventilator and, together with other family members, took
turns pumping in two-hour intervals. Their task eased when one son-in-law rigged an electric motor to power the
pump after dark. “If our son cannot care for us, we will care for him. As long as he’s still here, all is well,” Fu’s father,
a farmer, said in an interview with Zhejiang News earlier this month.
Fu and his parents are not alone. Facing a growing wealth gap and rising health-care costs, China’s poorest often
cannot afford the medical devices that could keep them alive. So more and more are turning instead to their own
ingenuity. In 2009 a group of patients facing late-stage kidney disease pooled funds to buy several secondhand
dialysis machines. And in 2012 Hu Songwen, who had exhausted his family savings on dialysis treatment, posted
a video online detailing how he had survived for 13 years on a homemade blood-filtering device.
“Their actions might be atypical,” says Chinese health expert Yanzhong Huang, “but they epitomize the
helplessness and hopelessness of a significant group of people in China who still cannot afford quality health care.”
Huang, a senior fellow for global health at the Council on Foreign Relations, says the high cost of health care is the
biggest problem facing people like Fu and Hu. For years, health-care costs in China have far outstripped Chinese
citizens’ ability to pay. Until several years ago, few Chinese—less than 30 percent in 2003—had access to health
insurance.
The Chinese government is doing what it can to ease this burden. In 2009 China’s Ministry of Health launched an
ambitious $124 billion plan to increase coverage for the uninsured. By 2011 more than 95 percent of China’s 1.3
billion were covered. At the same time, out-of-pocket health-care costs for the average Chinese citizen have
decreased dramatically, dropping from approximately 60 percent of all health-care costs in 1999 to just over 35
percent in 2011.
Even with these changes, effective health care is still unaffordable for many Chinese, according to Karen
Eggleston, director of the Asia Health Policy Program at Stanford University’s Shorenstein Center. Coverage is
“wide but shallow,” she wrote in a 2012 paper. Despite additional subsidies for the poorest of China’s poor,
advanced health care is often beyond the reach of this segment of the population.
As for Fu Xuepeng, a more sustainable solution to the ventilator problem came from the generosity of strangers:
in January the story inspired Chinese Internet users to donate almost $18,000 to buy him an electronic one. In
addition, local government officials have pledged to provide the Fu household with an uninterrupted supply of
electricity to power their son’s new ventilator. The outpouring of help has been overwhelming for Fu’s parents. His
mother, Wang Lanqing, told a reporter from Taizhou Commercial News: “There are too many good people on this
earth.”
In Praise of @BeijingAir (rectified.name)
Dave Lyons
http://www.rectified.name/2013/02/25/in-praise-of-beijingair/
There's talk over at ChinaFile that the air quality issue has reached a tipping point as a public health crisis in China,
and it's worth taking a moment to remember that the US Embassy played a major role in increasing awareness possibly one of the State Department's most effective public diplomacy moves in years, albeit unintentionally.
According to a 2009 State Department cable released by Wikileaks back in 2011:
At the request of the Ministry of ForeignAffairs (MFA), ESTH Off and MED Off met on July 7 with Mr. WANG Shuai
of MFA's Office of U.S. Affairs to respond to MFA's concerns about recent publicity in international and local press
surrounding an air quality monitor installed on the Embassy compound. MFA registered complaints on behalf of
the Beijing Environmental Protection Bureau (EPB) and the Chinese Ministry of Environmental Protection (MEP),
saying that making this data (which in their view"conflicts" with "official" data posted by the Beijing EPB) available
to the general public through an Embassy-operated Twitter site has caused "confusion" and undesirable "social
consequences"among the Chinese public. MFA asked Post to consider either limiting access to the air quality data
only to American citizens,or otherwise identify a suitable compromise. ... In August 2008 the Embassy began
posting corresponding "real time" air quality index (AQI) numbers,which are generated according to definitions
set by the U.S.Environmental Protection Agency (EPA), to an Embassy-managed Twitter site
(http://twitter.com/beijingair) on an hourly basis. While the initiative originally was primarily geared toward
informing the Embassy community about levels of pollution in immediate proximity to the compound, consular
"no double standard" requirements prompted Post to create the Twitter site as a user-friendly platform so that
private American citizens residing and traveling in Beijing are also able to access the data. ...local and
international press coverage spiked after Time Magazine published a story online about the Embassy's air monitor
on June 19. Since June 19, the site's number of "followers" has increased from approximately 400 to the current
total of 2500+, with at least 75 percent of the new followers being Chinese (judging from the screen names used).
Additional press articles have appeared in the South China Morning Post, China Daily, and other outlets, with
major local online forums like Sina.com ablaze with Chinese "netizens"commenting on this issue.
Twitter was blocked on June 1 2009 in the follow-up to the June 4 anniversary, then Liu Xiaobo was arrested on
June 23 for releasing Charter 08 six months earlier, and then to top it all off the Urumqi Riots started on July 5.
On July 7, China shut down local Twitter clone Fanfou as well as others. Sina Weibo launched in August 2009 after
China put a lid on Xinjiang and cut off its Internet, giving it a big head start over its major rivals Sohu, Netease,
and Tencent, who didn't launch microblogging until the following year. But @BeijingAir had enough Chinese
followers and struck such a chord in a Chinese public afraid for the health and mistrustful of government data, and
as soon as Sina launched the US embassy numbers were being hoisted over the firewall. China began promising
to upgrade reporting to include PM2.5 nanoparticles, which it previously didn't measure.
(See Chart)
With the latest "air-pocalypse" in Beijing, it's not just expats but everyone talking about air purifiers the way that
teen-age boys talk about cars. PM2.5 is basic vocabulary and a key fashion choice is whether to go with a knitted
cloth mask (don't), 3M N90 disposable mask (reliable, cheap, ugly) or the Respro masks that make you look like
Bane from Dark Knight Rises (Expensive, less data on effectiveness). Now you can buy Spaceballs-style cans of
air! As recently as last June, government officials were complaining that @BeijingAir was unscientific and unlawful,
which is not completely unfounded but no longer tenable. It's going take years to clean up the air, and @BeijingAir
didn't create the issue so much as give people information in plain English (literally) that they could use to
articulate what they already knew. But that's actually pretty cool. Bonus: Check out China.aqi.greatnumbers.org,
courtesy of Frederic Blanc-Brude of the EDHEC-Risk Institute, offering a nifty chart and open data on AQI levels
in Beijing, Shanghai, Guangzhou, and Chengdu.
Taiwan Celebrates Ang Lee’s Best Director Oscar Win for ‘Life of Pi’ (THE WSJ
CHINA REAL TIME REPORT BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/taiwan-celebrates-ang-lees-best-director-oscar-win-for-life-ofpi/?mod=WSJBlog
Ang Lee holds the Oscar for best director during the 85th Annual Academy Awards on Feb. 24 in Hollywood,
California.
When Ang Lee won the best-director Oscar for 3-D movie “Life of Pi,” Taiwan was quick to rejoice, with family, fans
and even the president expressing gratitude to the filmmaker for shining a spotlight on the island.
Taking a deep bow as he grasped his award, Mr. Lee thanked author Yann Martel for “writing this incredible
inspiring book” before going on to thank Taiwan, his place of birth.
“I cannot make this movie without the help of Taiwan,” Mr. Lee said in his acceptance speech, which was greeted
with a standing ovation. “We shot there. I want to thank everybody there [who] helped us, especially the city of
Taichung.”
“Xie xie. Namaste,” he concluded in Chinese and Hindi.
In a telegram to Mr. Lee, President Ma Ying-jeou said “everyone in Taiwan shares your most shining and proud
performance. Taiwan is proud of you,” according to a press release from the Presidential Office.
Meanwhile, Taichung Mayor Jason Hu said he plans to make Mr. Lee an “honorary citizen” of the city in central
Taiwan, calling the director “a living testament that Taiwan’s movie industry can have a spot in the international
arena,” according to a report in the state-run Central News Agency.
See more at Scene Asia
Watch: Chinese Political Adviser Comes Utterly Undone at Airport (THE WSJ
CHINA REAL TIME REPORT BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/video-chinese-political-adviser-comes-utterly-undone-at-airpo
rt/?mod=WSJBlog
Passenger meltdowns in Chinese airports typically inspire sympathy from a public all too familiar with the
frustration of flight delays. The unhinged destruction depicted in the video below is an exception.
Reason: The man in the video was late for the flight, not the other way around. And he’s a political adviser.
The official news portal for the government of southwestern China’s Yunnan province said Yunnan Mining Co. Vice
Chairman Yan Linkun had apologized to staff at Changshui Airport in the provincial capital of Kunming and was
suspended from his job (in Chinese).
Mr. Yan and his family arrived too late to board their flight from Kunming to Guangzhou on the morning of Feb. 19
after going to eat breakfast in the airport, according to the report. The family was forced to take a later flight,
which they also missed after misremembering the departure time. As you can see in the video, Mr. Yan grows irate
when he is not allowed through the gate the second time and proceeds to smash the area to pieces while a crowd
– including several security guards – looks on.
(See Video)
Mr. Yan is a member of the Chinese People’s Political Consultative Congress, a legislative advisory body. It was
unclear from either the video or the online report what happened to Mr. Yan immediately following his outburst.
A statement posted to the website of the Fengle Group, which owns Yunnan Mining, said Mr. Yan would pay to
replace the computers he smashed (in Chinese).
The apology and punishment appeared not to satisfy Chinese social media users, who have been inundated with
stories of elites behaving badly in recent months.
“Apology? I strongly demand he be sent to try to smash up an American airport,” wrote one user of Sina Corp.’s
Weibo microblogging service. “A one-way ticket should be enough.”
The airport also came under fire from some commenters for not doing more to control a dangerous situation. “This
is totally a terrorist act. Why didn’t airport security use force?” asked another Weibo user.
Mr. Yan could not be reached. Phone operators at the Changshui Airport did not pick up.
– Josh Chin, with contributions from Yang Jie
Ang Lee Best Director Win is Bittersweet for China Film Fans (THE WSJ CHINA
REAL TIME REPORT BLOG)
February 25, 2013
http://blogs.wsj.com/chinarealtime/2013/02/25/ang-lee-best-director-nod-bittersweet-for-china-film-fans/?mo
d=WSJBlog
Ang Lee’s best director win at this year’s Academy Awards unleashed a wave of pride on Chinese social media sites
Monday, though for some the award – Mr. Lee’s second – was a bittersweet reminder of mainland China’s
frustrated film ambitions.
Mr. Lee won the award for “Life of Pi,” a lushly shot 3D epic based on the book of the same name by Yann Martel
and filmed mostly in the director’s native Taiwan.
He previously took home best director honors for 2005’s “Brokeback Mountain.”
“Congratulations to Ang Lee for winning best director! The pride of Chinese people!” Guangzhou-based journalist
Gu Jian wrote on Sina Corp.’s Twitter-like Weibo microblogging service, echoing a sentiment widely shared across
the site.
Yet some wondered aloud what it meant that Mr. Lee had won two best director awards, while mainland China had
yet to take home one.
“Taiwan has Ang Lee, Hong Kong has Wong Kar-wai – what about the mainland?” asked Paris-based advertising
executive Hua Feng.
“[The mainland] has SARFT,” advertising industry website Madbrief.com replied, a reference to China’s famously
heavy-handed film regulator, the State Administration of Radio, Film and Television.
In his acceptance speech, Mr. Lee said he couldn’t have made the movie without the help of Taiwan and singled out
the coastal city of Taichung, in western Taiwan, where a lot of the filming for “Life of Pi” took place. He concluded
by saying thank you in Mandarin, as well as “Namaste”, a Sanskrit salutation common in India and Nepal.
While many Chinese social media users seemed proud to hear Mandarin spoken in an Oscar acceptance speech,
others cracked wise about how censors would handle it.
“The word ‘Taiwan’ popped up so many times in Ang Lee’s speech. It won’t be taken down, will it?” quipped one
Weibo user.
Parts of Mr. Lee’s acceptance speech in 2005 were censored in China, though the director largely attributed that
propaganda authorities discomfort with the homosexual romance at the heart of “Brokeback Mountain.”
Identity is a tricky topic for global celebrities with roots in Taiwan, which China’s government and many regular
Chinese consider to be a part of China. That tension was on full display in February 2012, when the sudden
emergence of Taiwanese-American basketball player Jeremy Lin launched a social media shouting match between
Internet users in China and Taiwan both eager to claim him as their own.
Mr. Lee’s own relationship with the mainland is complex. He’s had multiple movies banned or censored by Chinese
authorities, and his martial arts epic “Crouching Tiger, Hidden Dragon” earned a lukewarm reception on the
mainland. Yet he’s widely celebrated in mainland media and once told the Wall Street Journal that he considers
himself “like a proud son of China.”
His win inspired a debate over semantics on Weibo, with one popular social media commentator warning others
to distinguish between 华人 (huaren in Mandarin), a term that refers to all ethnic Chinese people, and 中国人
(zhongguoren), which refers to citizens of China.
“Please avoid calling [Mr. Lee] zhongguoren,” wrote the commentator, who posts under the handle Pretending to
be in New York. “The political flavor of this word is too strong. To forcefully impose it on someone overseas is not
only overbearing and disrespectful, it’s also just a fantasy.”
Mr. Lee’s name was among the most searched terms on Sina Weibo Monday. Searches for “Ang Lee” and “best
director” produced more than half a million posts by early afternoon.
– Josh Chin, with contributions from Qi Liyan
TV Show Host Du Haitao Justifies Spring Festival Weight Gain (chinasmack.com)
by Rensi on Monday, February 25, 2013
http://www.chinasmack.com/2013/stories/tv-show-host-du-haitao-justifies-spring-festival-weight-gain.html
“Happy Family” (the hosts of Happy Camp): (From left to right) Wu Xin, Li Weijia, He Jiong, Xie Nam, and Du
Haitao.
杜海涛 Du Haitao is one of the hosts on Hunan Satellite TV’s variety show 快乐大本营 Happy Camp, and is often
teased by the other four hosts Xie Na, He Jiong, Li Weijia, and Wu Xin) for being on the heavy side.
However, on a February 18th Weibo post, it was Du Haitao’s turn to tease people, for not gaining weight over the
Chinese New Year (aka Spring Festival) holiday. His Weibo post received 5,168 likes, 41,854 re-shares, and
16,527 comments.
@杜海涛Hito： Those people who don’t get fat even over Spring Festival, have you done right [are you worthy]
by the chickens, ducks, fishes, and pigs that died for Spring Festival?
Replies on Sina Weibo:
米妮1221:
Sorry, pigs, ducks, fishes, and chickens.
cici-苗:
My weight is a testament of my respect to those chickens, ducks, and fishes that died.
我最初的样子：
Ugh…my facial features have started to feel a little cramped recently when I smile/laugh~~
我是柒丫头:
I did right by them.
nazzna7:
That’s why I shot up 5kg without a second thought. ~
Bunny羙小希：
Let these souls rest in peace, because I was super worthy of them [totally did right by them].
Amylee-23:
Haitao is so insightful!
锐锐悦悦:
Are you happy? If you are happy, you should watch Happy Camp. If you are not happy, you should watch Happy
Camp even more! Jia you! I support you and Happy Camp forever!
柒_SHERLOCKED：
Gained 2.5kg. I’m proud.
我唱的不够动人你别皱眉-:
[Someone who] lost 2.5kg floats by.
凶残的胖子3191387594:
I feel the same! Fiercely ding‘ing.
枚兜：
Likewise it is unfair for us girls who can get fat even by drinking water!
你是奇葩我是怪咖：
[Are you] jealous, envious, and hateful?
允浩oba的翘臀控：
Haitao, stop trying to conceal the crimes you’ve committed.
何小小小小-霞：
[I] know you definitely did right by [were worthy of] them. Sigh.
无数的星空：
This is you looking for an excuse for your fatness.
小仙儿等待小贱:
[I'm] sincerely unworthy, [I got] skinnier.
冰岛的路:
Suddenly feel like all the weight again was worth it!!
破茧成蝶2942502133:
I’ve never had to worry about this problem.
聂章玲orHG:
Sorry, but I happen to be one of those who can eat and never get fat, no matter how much I eat I don’t get fat,
no matter what I can’t get fat by eating. Taotao [referring to Du Haitao] tongxue, do you envy me? Haha @杜
海涛Hito
[Note: 同学 tongxue literally means "fellow student" but is often used as a casual way to address someone
considered a peer.]
Promisedtp:
Tao [referrign to Du Haitao], you should stop eating. You are fat enough.
-王小琦:
Well what can I do…the fat all grew on your body [so it's not my fault I didn't get fat over Spring Festival].
我的奶奶是90后:
Brother Tao! I’m more than worthy of them! Because after this one Spring Festival, I’ve lost 5 kg!
快乐店_静诺529:
…Wuwuwu [crying]…I’ve gotten fatter…
16K独白:
1.5kg fatter every holiday!
[Note: The original Chinese here is adapted from a poem by ancient Tang Dynasty poet 王维 Wang Wei.
李炜不是你想嫁-想嫁就能嫁:
Wow, I now feel hungry.
乖乖的美人兔幸福:
Poor food!
赖雨柔L:
During Spring Festival, I ate six meals a day. I slept after eating, ate after sleeping, and I was too lazy to exercise.
You tell me how could I not get fat?
喵喵优姬zero:
Promote a vegetarian diet, which is conducive to good health and longevity.
明媚的卷心菜:
So true! [Those who] didn’t get fat aren’t human!!
Do you gain weight after holidays? Or are you one of those people who can never put on weight no matter how
much you eat?
Blazing a New Path for China’s Intellectually Disabled: Amity Bakery Heats Up on
Weibo (tealeafnation.com)
February 25, 2013 | by Rachel Wang
http://www.tealeafnation.com/2013/02/blazing-a-new-path-for-chinas-intellectually-disabled-amity-bakery-he
ats-up-on-weibo/
This image appears on Amity Bakery’s page on Taobao, a Chinese buying site. It reads in part, “Committed to
helping intellectually disabled persons find employment.” (Via Taobao)
“There is such a bakery in Nanjing: about one third of its employees are people with mental disabilities; it’s called
‘Ai De Bakery’ [Amity Bakery in English]. They are han han”—the character for “han” means simple and naïve, but
also straightforward and trustworthy—“with about a five or six years old’s level of intelligence, but they are
meticulous about everything…they have three stores in Nanjing already. There is bread and love here!”
This comment, posted on micro-blogging platform Sina Weibo by Tao Ran (@陶然), Vice President of Alibaba
Group, a Chinese Internet company, has attracted more than 20,000 reposts and 1,500 comments over just four
days. Most of the comments have evinced support. User @西瓜妈PK西瓜妹 wrote: “Immediately went to Taobao
and found [Amity’s account] after reading the post, bought five kinds of cookies, all delicious…Charity is different
from giving alms; teaching these kids to be self-reliant and live with dignity is a greater charity than giving money
and gifts. Wish everyone could support them.” Many other Weibo users commenting on Tao Ran’s post also opened
their wallets in support.
Amity appeared a bit overwhelmed by its instant Internet fame. Two days after Tao Ran’s post, the official Weibo
account of the bakery (@爱德面包坊), wrote, “Because of this post, we saw a surge of orders on Taobao. We had
not prepared for this, [and] all inventories of our regular stores are empty. All staff at the bakery are working
overtime …. Thank you so much for all the love from old and new fans, we will work harder!” Amity clarified that
their workers receive overtime pay and alternate days off.
Amity’s existence is not news. As early as in 2009, People’s Daily‘s overseas edition reported on technical
supervisor Kuang Zhenzhong, who teaches Amity employees how to bake. It was a typical state media
hagiography that never attracted national attention. An English-language blog called China Philanthropy has also
written about Amity Bakery. It says Amity Bakery was founded in 2007 by the Amity Foundation, a public
foundation started in 1985 by Chinese Christians in Nanjing. Now, years later, Chinese social media has helped
make Amity famous.
The positive buzz surrounding Amity provides a refreshing contrast to years of accumulated public anger towards
inhuman treatment of China’s intellectually disabled. In 2010, eight intellectually disabled people were found in a
chemical factory in the Western province of Xinjiang. Global Times then wrote that according to local official
reports, those eight people had “allegedly been confined to the factory, toiling for at least three years without
being paid or given any protective uniforms or equipment. And authorities said the workers were forced to live in
shabby conditions, not given showers for years and fed the same food as the boss’ dogs.” In 2011, an undercover
journalist posing as a disabled man found intellectually disabled men held as slave laborers in Chinese brick
factories.
That treatment is not only a moral outrage, but a waste of talent. Amity supervisor Kuang Zhenzhong said in a
2009 interview that his intellectually disabled employees were better at focusing and staying patient. Kuang said,
“Say for stirring, a basic step of baking. If you assigned a healthy person to stir all day, he/she will basically get
fed up with it. But [employees with mental illness] are different; they are very careful and devoted.” Amity bakery
says that their disabled employees work through a designed process, which dissects the whole production process
and assigns each of the employees discrete parts.
Some Weibo users praised Amity, but could not resist adding in an apparent jab at corrupt Chinese officials. Film
director @舒浩仑 commented: “Having a lower IQ does not mean one can’t do good deeds, they just learn more
slowly. In fact they are much better than those with high IQs who do harm to the country and the people.”