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All posts by LKY

Xinhua: Chinese SOEs Are “Big but Not Strong”

According to an article that Xinhua published, in 2002, only 11 Chinese companies made the Fortune Global 500 list, but, in 2017, 115 Chinese companies made the list compared to 132 U.S. companies. Most of the Chinese companies are from the bank, insurance, telecommunication, and electric grid industries while 60 percent of the companies were SOEs (state owned enterprises) and accounted for over 80 percent of the net capital and total income. However the article called these SOEs “big but not strong.” They lacked the ability to be competitive, especially in value creation ability. The article stated that the Chinese companies lagged behind in Internet, information technology, pharmaceutical, automotive, military, semiconductor, and chip industries when compared to the Western companies. Among those 109 Chinese companies on the Global Fortune 500 list, the Return of Asset rate was only 1.65 percent compared to 4.79 percent for the U.S. companies. Chinese SOEs are behind in the high end core technology and the spare parts industry and there are no companies that are even comparable with the Western companies in the pharmaceutical and semi-conductor industries. The article reported that the Chinese SOEs need to make breakthroughs in renovation and resource dependency and to rely less on core product imports while improving on brand position and quality.

Source: Xinhua, January 15, 2018

Aboluowang Commentary: Xi Jinping Is Unlikely to Make a Term Change during the Upcoming Central Committee Plenary Session

Aboluowang published a commentary article in which it reported that any speculation that Xi Jinping might push for a term change during the upcoming central committee plenary session might have come from Jiang’s faction for the purpose of creating negative media trouble for Xi.

According to the article, the second plenary session of the 19th Party Central Committee will be held from Jan. 18 to 19 in Beijing. The major agenda of the meeting will be to make small changes in the constitution. A number of different media outlets, including Deutsche Welle, Bloomberg News, and Mingbao speculated that Xi Jinping might want to incorporate a change in the term limit for the Presidency into the constitution because he has apprehended large number of corrupt officials and, during his term, has touched the core interest of Jiang’s faction. Once his term ends, he and his family could face danger. However, based on Xinhua’s report that there will be a small change made to the constitution during the plenary session, it is unlikely that a change in the term limit will be made this time. It is likely that some additional “Xi Jinping Thought,” which was added into party constitution last year, could be included in the constitution this time. The Aboluowang commentary suggested that the Chinese Communist Party always plays black box politics and there has been no defined rule regarding its succession plan. There can be many different forms if one wishes to stay in power, just as how Deng Xiaoping and Jiang Zemin continued to exercise their influence after they stepped down from their post. Currently Xi’s control over power is not yet complete. It is unlikely for him to push for a term change and invite more trouble for himself. Therefore the faction that Jiang leads could have made up much of the speculation out there in order to create negative media trouble for Xi.

Source: Aboluowang, January 14, 2018

Shanghai Marriott under Investigation for Listing Taiwan, Macau, Taiwan, and Tibet as Countries on its Website

In a recent news report, Duowei stated that the Marriott Hotel chain violated the Internet security and advertising law in China when it listed Taiwan, Macau, Taiwan, and Tibet as countries. The Shanghai Huangpu District Internet Information Office has, currently, placed the Marriott under investigation. According to the report, on January 9, the Marriott issued an apology on its official Weibo account saying it was a system error. On January 10, the Shanghai Huangpu District Internet Information Office issued a notice stating that they have met with the representatives of the Shanghai Marriott twice and requested it to take down the incorrect information from its website and cell phone apps immediately to “eliminate the negative influence.” According to Duowei news, in addition to the Marriott, the official websites of other luxury brands, including Audi, Cartier, Hermes, Burberry, and Armani also listed Hong Kong, Macau, and Taiwan as countries.

Source: Duowei News, January 10, 2018

RFA: Fearing a Spread of the Rights Movement, Chinese Authorities Blocked News Coverage on Iranian Protests

According to an article that Radio Free Asia (RFA) published, the Ministry of Publicity reportedly circulated a notice on the Internet which stated that no media outlet is allowed to report on the Iranian people’s protests. The notice ordered that no media should have news coverage on anything about Iran or on anything about the protests. It also requested that the Office of Cyberspace Affairs launch its plan to monitor Internet activity on any forum discussions about the protests; it should also consider a shutdown of any online discussions, comments, and forwarding functions, if needed, and detain those who violate the order. The article reported that, even though it was hard to verify the authenticity of the notice, it did find that there has not been much news coverage on the protests in the official media. It also appears that any online discussion on this topic has not been widely censored.

The RFA article reported that, since the protests broke out in Iran, over three million people went to the streets to protest. At least two protesters died and over 200 were arrested. The Iranian government also shut down a number of social media platforms, accusing the protesters of using the social media platforms to organize protest activities.

Source: Radio Free Asia, January 1, 2018

VOA Media on China Program: “Big Brother” Has Arrived

The VOA “Media on China program” published an article on China’s surveillance capability. It refers to how China is just like the totalitarian society in the fiction story 1984 written by George Orwell in which “Big Brother” monitors every move, spoken word, and thought of all members of society while it uses the same monitor to broadcast its propaganda. Below is a partial translation of the article:

In the western world the law often prohibits the government from launching surveillance of its citizen. The government is not allowed to arrest or sentence its citizens using information that has been obtained illegally. In China the government can use its resources to monitor or arrest its citizens. To many people, China is best known for its Internet surveillance efforts because the resources that the Chinese government has invested in Internet surveillance surpass those of any other country in the world. China has the capability of monitoring its citizens 24 hours a day because it has the largest surveillance network in the world. In 2017, there was one surveillance camera for every eight citizens; by 2020 there will be one surveillance camera for every two citizens. These camera heads are equipped with the capability of facial recognition. With the help of tech companies such as Ten Cent, the Chinese authorities control and screen a large amount of surveillance information. We Chat, which Ten Cent developed, assists the Chinese authorities in censoring sensitive political information or social media while sharing the customer’s information with the police. Meanwhile people can no longer remain anonymous online. Starting in 2013, when the Chinese authorities required that every cell phone should be under each citizen’s real name, every We Chat account had to be linked to a cell phone number.

Source: Voice of America, January 3, 2018

RFA Commentary: What It Means When China Limits the Outflow of Currency

Radio Free Asia published a commentary reporting that the State Administration of Foreign Exchange recently issued a notice that, starting January 1, 2018, each year, a Chinese citizen, when in a foreign country, will only be able to withdraw 100,000 yuan (US$15,415) cash using a debit card or credit card that a Chinese bank has issued. They will also be limited to a cash withdrawal of 10,000 yuan (USD$1,541) each day and will be prohibited from using other people’s cards or letting other people borrow their card to withdraw the cash. The article said that the tightened cash policy is an indication that the Chinese economy may appear strong from the outside but it is weak on the inside. The article stated that forcing the “low end” population to leave big cities and to limit the cash flowing out of country, are both indications that China’s political climate is far more serious than what has been reported. The article said, “There was a prediction that the bubble in China’s economy might burst soon. Even though it has not happened yet, it could only be a matter of time and will catch people off guard because some of the real issues are being pushed aside and have still not been resolved.”

Source: Radio Free Asia, January 1, 2018

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