Chinascope – Page 1031

Chinese Foreign Minister: China will Continue to Support the EU and the Euro

During his visit in Poland, Chinese Foreign Minister Yang Jiechi told the media that China pays close attention to the sovereign debt crisis in Europe. China supports the measures that the European Union and the International Monetary Fund have taken to stabilize the situation. “China continues to have confidence in the Euro zone and the Euro. In recent years, China has increased its holdings of Euro bonds.” Yang said that China will continue to support Europe and the Euro.

Yang also hoped that “the United States adopt a responsible monetary policy,” and that “the U.S. implement practical measures to insure the safety of other countries’ assets in the U.S.”

Source: China News Service, August 5, 2011
http://www.chinanews.com/gn/2011/08-05/3236891.shtml

Briefings | | August 8, 2011 | Geo-Strategic Trend

China’s Dependence on Crude Oil Surpasses That of the U.S.

According to People’s Daily, the Ministry of Industry and Information Technology (MIIT) has issued data showing that, from January to May 2011, China’s domestic apparent consumption (production plus net imports) of oil reached 198 million tons, an increase of 10.3 percent over the same period last year. The apparent consumption of crude oil was 191 million tons, an increase of 8.5 percent. China relies on imports for 55.2 percent of its crude oil consumption, a proportion surpassing that of the U.S. MIIT warned that China’s oil consumption outpaces its GDP growth, placing tremendous pressure on energy production and conservation, as well as the reduction of emissions. The Chinese Academy of Engineering projects that, by 2030, even under a pessimistic scenario, China’s annual oil demand will reach 644 million tons. Without proper control, China may have to import 70 percent of the oil it consumes.

Source: People’s Daily online, August 4, 2011
http://energy.people.com.cn/GB/15324102.html

Briefings | | August 5, 2011 | Economy/Resources

Xinhua: China Cannot Promise to Give Up the Use of Force in South Sea Conflict

Xinhua published an article by a scholar from Xiamen University, stating that China should not promise to give up the use of force in the South China Sea conflict. The article says, “The essence of the Philippines and Vietnam asking to sign a binding document with China through ASEAN on peaceful actions on the South China Sea issue is that they are attempting to force China to acknowledge their occupation of the South China Sea islands … and to nullify China’s ability to use armed force.” The article claims, “For a long time, China adopted a friendly policy toward its neighbors so as to win time for its economic development. However, in the South China Sea conflict, there is no win-win outcome. China must be prepared for military action. China is the party whose sovereign rights are violated. If China unilaterally promises to solve the conflict only through peaceful means, it will … allow the de facto occupation of the South China Sea islands by the Philippines and Vietnam. The Philippines and Vietnam will not need to worry about being attacked by armed force. Considering the arrogant attitude of the Philippines and Vietnam, the possibility of regaining the occupied islands in the South China Sea through peaceful means is quite minimal.”

Source: Xinhua, August 3, 2011
http://news.xinhuanet.com/mil/2011-08/03/c_121762183.htm

Briefings | | August 5, 2011 | Geo-Strategic Trend

Xinhua Commentary: Japan’s Defense White Paper Deliberately Raises Tension

Xinhua published a commentary blasting Japan’s newly published defense white paper. The article says, “The 2011 defense white paper that the Japanese government released … extensively describes China’s military force in large volumes and even fans the flames to stir up a tense atmosphere. The Japanese action severely damages Sino-Japanese relations.” “This year’s defense white paper not only makes irresponsible remarks about China’s normal development of its national defense but also incites dissension and transmits aggressive and invasive intentions in the text.” “Additionally, what’s ‘new’ in the white paper is the claim that China is starting to show a ‘forceful manner,’ while Japan is starting to display a posture of ‘caring for’ its neighbors.”

The article further states that there are two reasons for Japan to make such comments in the white paper. “First, Japan has been constrained by a cold war mentality for a long time; trapped in the Japan-U.S. ally’s mythology; and embedded in a milieu of ‘China threat’ and ‘containing China.’ Second, Japan has a strong invasive desire to get rid of the restrictions on its defense policy that its peace constitution imposed after the war (World War II).”

Source: Xinhua, August 4, 2011
http://news.xinhuanet.com/mil/2011-08/04/c_121809765.htm

Briefings | | August 5, 2011 | Geo-Strategic Trend

Scholar: Protect the Dollar Value of China’s Holdings of U.S Debt.

Sun Lijian, a Professor of Finance and Vice Dean of the School of Economics at Fudan University, wrote an article in Shanghai Securities News recommending that China should expand Shanghai’s offshore settlement business to control the dollar value of its holdings of U.S. debt. “When they (the United States) threatened to default, we realized how critical it is for China to … internationalize the renminbi.” Sun recommended that China leverage Shanghai as an international financial center and proactively expand the Asian dollar offshore settlement business. This would enable China to get around the bottleneck from the absence of a market mechanism for adjusting the exchange rate and the interest rate, the lack of international finance professionals, and the deficiencies in risk management. That, wrote Sun, would allow China to protect, to the maximum extent, the dollar value of its holdings of U.S. debt, and buy time for China to internationalize the renminbi.

Source: Shanghai Securities News reprinted by Qiushi, August 1, 2011
http://www.qstheory.cn/jj/jjyj/201108/t20110801_98836.htm

Briefings | | August 4, 2011 | Economy/Resources

China’s Defense Minister Promotes Military-Civilian Integration

In an article in Qiushi, China’s Defense Minister, Liang Guolie, a member of Chinese Communist Party’s Central Military Commission, stated that the ultimate purpose of the military-civilian integration strategy is to develop the country’s prosperity and empower the military, both being the cornerstones of the rise of China. The military-civilian integration consists of four major tasks: 1. Establish and perfect scientific research & development (R&D) of military armaments; 2. Establish and perfect a mechanism to train and retain military talent; 3. Establish and perfect information sharing by leveraging civilian information technology; and 4. Establish and perfect the national defense mobility system, including the militia and reserves.

Source: Qiushi, August 1, 2011
http://www.qstheory.cn/zywz/201108/t20110801_98732.htm

Briefings | | August 4, 2011 | Defense/Military

State Think Tank Critical of Secretary Clinton’s Remarks on India

Xinhua reprinted a commentary from Jiefang Daily that Wang Yusheng, the Executive Director of the Centre for Strategic Studies at the China Foundation for International Studies, wrote about U.S. Secretary Clinton’s speech made during the U.S. – India Dialogue. According to Wang, Clinton “encouraged and urged India” to play a role in the east. The title of the commentary was “Hilary: You Cannot Hurt China; You Only Exposed Yourself." Wang stated that the objective of Secretary Clinton’s remarks was to instigate fights and contain China. “Although the U.S. neo-conservative idealists expected tension between China and its neighboring countries, it did not occur. This was not because of the U.S. ‘hard power’ and ‘soft power’ or its much relished ‘smart power’; rather, it was the result of China’s ‘affinity power.’” The negative behavior of the U.S. toward China “cannot hurt China and merely brings to light the dark side and the vulnerability of its international behavior.”

Source: Jiefang Daily reprinted by Xinhua, August 1, 2011
http://news.xinhuanet.com/world/2011-08/01/c_121750738.htm

Briefings | | August 4, 2011 | US-China Relations

China Review News: China’s Stimulus Package Now Hurts Its Growth

China Review News published a commentary stating that, though China’s loose monetary policy quickly stimulated the economy, its residual effect has been to dampen China’s economy. First, a huge amount of loans has built up inflation pressure. The CPI has kept increasing since the fourth quarter of 2010; it reached a peak of 6.4% in June 2011. Since 2010, the People’s Bank of China has been forced to raise the deposit reserve ratio 12 times and the interest rate 4 times. This credit tightening causes economic growth to slow down. The unemployment rate may shoot up as small-and-mid-level businesses face challenging times to get loans.

Second, in 2008, by issuing bonds, local governments financed 70% of the government’s 4 trillion yuan ($US600 billion) stimulus package. By the end of 2010, local government’s debts had jumped to 10.7 trillion yuan ($US1.6 trillion). Local government’s inability to pay back the loans will hurt banks. The large local government debts also hinder the central bank’s ability to fight inflation, as higher interest rates makes it harder for local governments to pay back their loans.

Third, China’s efforts to cool down the overheated real estate market will hurt construction and other real estate related industries.

Source:
China Review News, August 3, 2011
http://gb.chinareviewnews.com/doc/1017/8/3/8/101783832.html?coluid=1&kindid=0&docid=101783832&mdate=0802001129

Briefings | | August 3, 2011 | Economy/Resources

Wu Guoguang: Xi Jinping’s Reversal of the Course, Will China’s Transition be Peaceful or Marked with Bloodshed?

Cheng Xiaonong: U.S.-China Strategic Relations Have Crystallized

Xinhua Commentaries: “Exposing the Three Major Political Deficits of the U.S.”

The CCP’s Performing Arts Troupes in the U.S.