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Qiushi: The Unity of Developing the Socialist System and Improving the National Governance Systems

Qiushi reported on a speech that Xi Jinping recently gave at the opening ceremony of the Seminar for Major Provincial Leaders to Study the Decision of the Third Plenary Session of the 18th Chinese Communist Party (CCP) Central Committee. In his speech, Xi stated that "[We] must fully understand the overall goal of comprehensively deepening reforms. It is a unity of two sentences: Improve and develop the Socialist system with Chinese characteristics and advance the modernization of national governance systems and governance capacity."

The Qiushi article discussed how to understand Xi’s statement. It explained the "unity" or the "same goal" of developing the social system and improving governance system: the CCP "should, via improving and developing the Socialist system with Chinese characteristics, implement the institutionalization, standardization, and procedures of governing the Party, the nation, and social affairs," and also "via building up the national governance system, develop the Socialist system with Chinese characteristics."

It further elaborated on the "national governance culture" and affirmed its importance in applying Marxist theory and the "correct political viewpoint and value system" to guide the national governance system.  

Source: Qiushi Online, June 15, 2014
http://www.qstheory.cn/bwtj/2014-06/15/c_1111149821.htm

Briefings | | |   Government/Politics

Global Times: China Can Use the Gun to Solve Territorial Disputes

Global Times, or Huanqiu Shibao, a state newspaper under People’s Daily with a focus on international news, published an article stating that it is perfectly fine for China to "fire a gunshot" when dealing with territory disputes with its neighbors.

The article argued that peaceful development and regional war coexist in the world. "A country should have the right to development, the right to peace, and the right to have a war." "During China’s peaceful rise, to safeguard the sovereignty of its national territory and its ocean rights," China can "selectively choose to use force or peaceful negotiations." There is no need to tie its hand with the notion of "peaceful development."

"China’s renaissance includes economic development, as well as safeguarding its ocean territory and recapturing its lost islands." When the opportunity for recovering its lost territory comes, China should not hesitate to grab it.

Source: Global Times Online, June 10, 2014
http://mil.huanqiu.com/observation/2014-06/5015795.html

Briefings | | |   Government/Politics

China’s Local Governments Are Deep in Debt

China Review News reported that the level of debt that China’s local governments have reached is unsustainably high. According to the China’s National Audit Office, by June 2013, local governments had 10.88 trillion yuan (US$1.78 trillion) in debt obligations, 2.66 trillion yuan (US$429 billion) in debt for which they have provided guarantees, and 4.34 trillion yuan (US$711 billion) in debt for which they bear certain bailout responsibilities. The total is close to 18 trillion yuan (US$3 trillion).

The peak period of the debt payback, which is from 2014 to 2017, is close at hand. However, so far, local governments have put up a total of 320 billion yuan (US$52 billion) as the reserve to pay off the debt.

Facing the mounting pressure of a local debt crisis, in an attempt to resolve this problem, the State Council approved ten local governments to issue local bonds. The ten governments include Shanghai, Zhejiang Province, Ningxia Hui Autonomous Region, and Qingdao City in Shandong Province.

Source: China Review News, May 26, 2014
http://hk.crntt.com/doc/1032/0/4/8/103204872.html?coluid=53&kindid=0&docid=103204872&mdate=0526070321

Briefings | | |   Government/Politics

DWNews: Xi Jinping Uses the CICA to Counter the U.S.

DWNews.com, an New York based Chinese news portal, published an article on the recent Summit of the  Conference on Interaction and Confidence-Building Measures in Asia (CICA) which was held in Shanghai on May 20 to 21. The article stated that Xi Jinping took the CICA as a platform to implement his strategy to reduce the U.S.’ influence in Asia. Xi stated at the summit that Asia’s affairs need to be taken care of by Asians; Asia’s problems need to be taken care of by Asians; and Asia’s security needs to be taken care of by Asians.

The article further explained that the reason Xi picked the CICA instead of the Shanghai Cooperation Organization (SCO) to send this message is because the SCO, which is led by China and Russia, already has a strong anti-U.S. flavor. It would be too sensitive to use the SCO as the platform to send such a message. CICA, which Kazakhstan initiated, has a much wider participation (26 countries, including all six of the SCO member countries).

Source: Dwnews.com, May 24, 2014
http://china.dwnews.com/news/2014-05-24/59473636.html

Briefings | | |   US-China Relations

China Securities Journal: Three Major Challenges for China’s Economic Reform

A China Securities Journal article listed three major challenges that severely hinder China’s economic reform:

1. The lack of protection for legitimate property rights. Local governments expropriate farmer’s land, even when the farmers have the proper contracts for using the land. When there is a need to boost the economy, local governments invite companies to invest. Later, when they try to cool down some overheated sectors, the local governments force them to exit the market.

2. The lack of a formal government budget spending process. The top official can, individually, make a decision on spending. At end of the budget year, government agencies rush to spend funds.

3. The lack of measurements for correct performance and of a reward system for government officials and the heads of state-owned enterprises. Their evaluation is linked to short-term economic achievements instead of long-term performance. This induces officials to pursue temporary results while leaving the major burdens for the public to handle in the long run.

Source: China Securities Journal Online, May 13, 2014
http://www.cs.com.cn/sylm/zjyl_1/201405/t20140513_4388241.html

Briefings | | |   Economy/Resources

China Review News: Xi Jinping’s International Strategy

China Review News published a commentary on Xi Jinping’s international strategy for China. A few points it mentioned follow:

1. China wants a peaceful development path; it also needs other countries to take the peaceful approach. If some country takes China’s restraint and patience as a sign of weakness, and takes advantage of China’s suggestion of solving conflicts via political dialog and the diplomatic approach, it will pay dearly for it. “China is not afraid of conflict, nor does it want conflict. One should not separate peaceful development from safeguarding our national interest. China’s core national interest is not allowed to be attacked or harmed.”

2. China is working on the following international relationships:

– Establishing a new type of relationships with major countries. For the U.S., take the approach of no-confrontation, mutual respect, and cooperation for a win-win situation. For Russia, treat each other as the largest and most important strategic partner. For the Europe Union, focus on the trend of change there and the on development opportunities. For India, take the advantage of the rapid development trend in both countries and engage in cooperation and joint-development.

– Advance the diplomatic relationship with neighboring countries. In the next five to ten years, create win-win situations, push for regional security cooperation, and establish a public opinion base for a sense of community.

– Set up the right view of righteousness and interest in order to strengthen and develop the cooperation with developing countries. For those countries that have been a long-term friend of China but are having a hard time with their own development, China should give greater consideration to their interests.

– Be more active in international affairs.

Source: China Review News, May 7, 2014
http://hk.crntt.com/doc/1031/7/0/1/103170107.html?coluid=151&kindid=11513&docid=103170107&mdate=0507000519

Briefings | | |   Geo-Strategic Trend

Global Times: There Is No Person in the Military That We Can’t Touch

Global Times published an article promoting the anti-corruption campaign in the military. The article stated that, although the public received the Xi Jinping-headed anti-corruption campaign very well, recently some voices have suggested that this kind of anti-graft action will create chaos in the military. The fallacy was even put forth that "the military can lead the spiritual civilization campaign, but not the anti-corruption campaign."

The article rebutted these views by stressing that only a clean army can defend the country well. "There is no person in the military that we can’t touch [with a corruption charge]."

The article acknowledged that the anti-corruption campaign is a tough job and suggested three areas to focus on: (1) the officers, (2) the two fields where corruption is intense – personnel management and military property management, and (3) the cause of corruption – low moral standards and wrong ideology.

Source: Global Times, May 12, 2014
http://mil.huanqiu.com/observation/2014-05/4992407.html

Briefings | | |   Government/Politics

Xinhua: Capital for Real Estate Companies Is Drying up

Xinhua recently reported that, according to the E-House Real Estate Research Institute’s "Report on Real Estate Enterprises’ Capital in the First Quarter of 2014," China’s real estate companies are tight on money.

For the first quarter, the year-on-year increase in the rate of fully-funded capital was 6.6 percent, a significant drop from last year’s 26.5 percent. On the source of capital, year-on-year foreign investment decreased 33.9 percent, while money from domestic lending and self-raised capital increased by 20.4 percent and 9.6 percent respectively.
The year-on-year increase in the rate of money lent domestically, foreign investment, self-raised money, and other sources of capital also dropped by 12.7 percent, 66.7 percent, 11.7 percent, and 30.8 percent respectively.

Unlike the tight money in real estate, the land market was still hot. Ten typical cities’ land transfer fees totaled 269 billion yuan (US$44 billion), an increase of 83.1 percent from a year ago. The total in land transfer fees from first tier cities (Beijing, Shanghai, Guangzhou, and Shenzhen) was 175 billion yuan (US$28.6 billion), which was 35 percent of last year’s annual amount.

As both overseas capital and domestic capital are drying up and as land prices keep increasing, the real estate business faces a severe money challenge. "Mid-level and small companies need to prepare for bad times. Some companies that can only tolerate a low risk may be forced out of the market."

Source: Xinhua, May 13, 2014
http://news.xinhuanet.com/house/bj/2014-05-13/c_1110654420.htm

Briefings | | |   Economy/Resources