Government/Politics - 178. page

People’s Daily carried an article which Outlook Weekly had originally published. The article stated that, recently, the Central Leading Group for Comprehensively Deepening Reforms passed two opinions on State Owned Enterprise Reform. One is called the “Opinion on Being Persistent in the Party’s Leadership and Development during State Owned Enterprise Reform.” The other is called the “Opinion on Strengthening and Reform of State Owned Enterprise Asset Supervision and the Prevention of State Owned Enterprise Asset Loss.” The article stated that these two Opinions have set the tone from the central administration and provided a timely guarantee to ensure the smooth progress of State Owned Enterprises reform.

According to the article, of the two opinions, the Opinion on “Party Must Assume Responsibility for Managing SOEs” attracted the most attention but it was not the first time that it was brought up. The article listed similar proposals made in the Fourth Conference of the 16th Congress of the CCP in 2004 and the National Party Development within State Owned Enterprise Conference in 2009. Based on the comments from the research experts quoted in the article, defining the Party’s legal position within the company is very sensitive because the current company structure has a board of directors as the core leadership team. Therefore company policy may need to be modified to define the Party’s legal position within the corporation. It is expected that more policies on this subject will be introduced in the near future.

Source: People’s Daily, June 14, 2015
http://politics.people.com.cn/n/2015/0614/c1001-27150930.html

Voice of America carried an article that quoted comments that He Yafei, Chinese diplomat and current Vice-Minister of the Ministry of Foreign Affairs, gave at a recent talk. He spoke at a “China and External Communication Forum” held in Chongqing on June 11. The article said that He called on the media in China to break the barrier of foreign media. According to He, even though China has made a large investment in building its propaganda team overseas, China’s voice is too weak and is limited in disseminating its story. Close to 50 Western media outlets account for 95 percent of the world’s media market and only 20 percent of the people from foreign countries have gotten to know China through Chinese media. He said that the Western media initiated propaganda promulgating the China Threat and the China Collapse theories. They constantly impose its own value system on others. As to the attacks and negative comments on China, He said that China needs to have an open dialogue and clarify the facts.

Source: Voice of America, June 12, 2015
http://www.voachinese.com/content/media-watch-20150612/2819105.html

On June 11, 2015, Xinhua reported that China’s ex-security chief Zhou Yongkang was sentenced to life in prison. He is the most senior Communist official to face corruption charges. Zhou is 72 years old.

On June 7, 2015, Hong Kong Oriental Daily published a commentary titled, “The CCP Deceived the World about the Yangtze River Shipwreck Rescue.” On June 1, 2015, a Yangtze River Passenger Cruise Ship, “The Eastern Star” capsized. Of the 456 people on board, only 14 people survived. Seven swam ashore; five drifted to other places where local residents saved them, and “rescue teams” saved two more. The other 444 people either died or were missing. This shipwreck caused the most deaths since 1949, the year when the People’s Republic of China was established. From June 2 to June 5, the Chinese Communist Party (CCP) Propaganda Department issued 5 orders to restrict and ban media coverage.

On June 2, the CCP Propaganda Department notified all media that no reporters were allowed to visit the shipwreck area or conduct interviews. Many reporters ignored the ban and still interviewed some survivors and witnesses. Their articles could not be published. A 2nd notice from the Propaganda Department stated that all media in China could only publish relevant Xinhua News articles or broadcast the China Central Television (CCTV) footage. "The news must highlight the CCP Central Committee’s attention to the incident, to the rescue efforts, and to the treatment of the victims. Do not describe the details of the tragedy. Whoever violates the rules must be held accountable." 

Chinese Premier Li Keqiang chaired a State Council Executive Meeting on June 4, 2015. To facilitate innovation and entrepreneurship in China, the meeting decided to cancel the household register restrictions and academic diploma requirements for entrepreneurs. However, residence restrictions in Beijing, Shanghai, Guangzhou, and Shenzhen will not be canceled within a short period of time due to the limited capacity of these first tier cities. The 2nd and 3rd tier cities will take the lead to attract new entrepreneurs from outside, who may or may not have academic diplomas. “As long as you have the will and ability to start a business, no matter where are you from, and regardless of your educational level, the policies will support you.”

Source: People’s Daily, June 7, 2015
http://politics.people.com.cn/n/2015/0607/c1001-27116255.html

 Liu Shan, deputy editor-in-chief of China Business Times, reported on an interview of an anonymous "authoritative insider" on the Chinese economy. People’s Daily published the interview on its front page on May 25. Then on May 26, the Hong Kong based Phoenix Television’s website carried an analysis of the interview.

One of the things that People’s Daily indicated in the interview, according to Liu, is that "China’s bull market is a long term necessity."

People’s Daily‘s interview of the "authoritative insider," when commenting on China’s economic downturn, acknowledged the vital effect of investment on economic growth, "At this stage of China’s development, whether savings can be transferred to investment will be the key to stable economic growth. Given the high rate of household savings, the Chinese people are having trouble getting a sustainable return on assets. At the same time, the real economy and key construction projects lack sufficient funding. More financing channels need be explored to tap into the potential of private capital and to transfer more savings into investment."

It is clear from the "authoritative insider" that the public needs sustainable income from savings and the real economy need financing. The most straight-forward approach is to increase direct financing. This can only be done through the capital market; that is, by directing savings into the pre-IPO market, the equity market, and the bond market so as to generate income based on people’s cash assets. As a result, sustaining a healthy bull market should have been a strategic decision of the central government, rather than a short term expediency.

The central government would also like to achieve the dual effect of stabilizing growth while reducing leverage. Again this approach would effectively increase direct financing. Through direct financing, banks’ loan-deposit ratio could be lowered. We consider that reducing leverage on equity financing by the regulatory authorities is not meant to suppress the equity market. Instead, it is meant to prevent the bubble from growing too fast to lead to a sudden burst. If regulatory measures are appropriate, we expect this round of bull market will last at least three years.

Source: Pheonix TV Online, May 26, 2015
http://finance.ifeng.com/news/special/xiaobg74/