Chinascope – Page 1056

Chinese Major General Faults the U.S. for Rocky Military Relationship

Professor and Major General Zhu Chenghu of China’s National Defense University believes that the U.S. is responsible for the vicious cycle in the current U.S.- China relationship, i.e., interrupt, start over, interrupt again and start over again. Zhu states that the U.S.-China military relationship faces three obstacles: arms sales to Taiwan, the 2000 National Defense Authorization Act (NDAA), and U.S. reconnaissance of China’s coastal areas. Zhu does not expect that the recent visit to the United States of Chief of the PLA, General Staff Chen Bingde, will put the relationship on a healthy path. Although the U.S. State Department opposes the sale of the F-16CD to Taiwan, the U.S. Defense Department, which proposed the sale, will eventually prevail, thus creating another crisis in the U.S.-China relationship. Zhu holds that the 2000 NDAA is unfair in that it prohibits military exchanges with China in 12 categories.

Zhu is famous for the comment he made in 2005, in which he warned that his country could destroy hundreds of American cities with nuclear weapons if the two nations clashed over Taiwan.

Source: People’s Daily, May 23, 2011
http://military.people.com.cn/GB/42969/58519/14714651.html

Briefings | | May 26, 2011 | US-China Relations

Guangming Daily: State-Owned Enterprises Should Learn to Avoid Risks in Overseas Investment

A recent Guangming Daily commentary advises that state-owned enterprises should learn to avoid commercial and political risks when making overseas investments. Among the US$18.8 billion worth of contractual projects of Chinese enterprises in Libya, commercial insurance only covered less than 400 million Chinese yuan (US$61.50 million) of the loss. The rest of the investment in Libya has been “left to God’s mercy.”

The article said, “in a country with an immature market, the big hand of government still influences the economy. When the government is stable, the risk is controllable. To make money in such a country, as long as one holds onto the big hand of government, everything – winning projects, making investments, and obtaining loans – falls into place. … Once the big hand of government is crippled due to political changes, all the ‘hands’ holding that hand will inevitably become empty.”

At the end of 2009, the state-owned enterprises had 6,000 branches overseas with total assets of over 4 trillion yuan (US$615.62 billion). From 2010 to the present the period of Chinese companies investing overseas peaked.

Source: Guangming Daily, May 23, 2011
http://politics.gmw.cn/2011-05/23/content_1992697.htm

Briefings | | May 25, 2011 | Economy/Resources

The Eighth Sino-Arab Cooperation Forum Held from May 22 to May 24

From May 22 to May 24, 2011, senior official representatives from China and Arab countries attended the Eighth Sino-Arab Cooperation Forum. Assistant Foreign Minister Saif Muqqadam al Buainain, the Chairman of the Arab side of the meeting, “highly commended” all elements of the Arab-Chinese partnership. He said, “The Forum has become a milestone in the advancement of Arab-Chinese relations, as it provides an appropriate framework and designs effective mechanisms for dialogue and collective action, based on a solid foundation of equality and mutual benefits and interests.”

So far, the Sino-Arab Cooperation Forum, established in January 2004, has held four ministerial conferences and seven senior official level conferences. It has 11 cooperation mechanisms which cover political, economic, cultural, and other fields.

Source: Xinhua, May 23, 2011
http://news.xinhuanet.com/2011-05/23/c_121445068.htm

Briefings | | May 25, 2011 | Geo-Strategic Trend

Baidu and Chinese Government Sued in New York

BBC Chinese News reported that, on May 18, 2011, eight New York residents filed a lawsuit against the Chinese government and China’s biggest search engine vendor Baidu for blocking pro-democracy Internet content. The suit asks for US$16 million in damages. It is believed that this is the first time a lawsuit against a company has also included the Chinese government. Chinese spokesperson Jiang Yu commented on the lawsuit, saying that the Chinese government follows worldwide common rules to manage the Internet and foreign courts do not have jurisdiction over this matter. Baidu, a NASDAQ-100 index company, proactively filters “sensitive words” based on the Chinese government’s requirements. China also blocks popular websites such as Facebook, Twitter, and YouTube.

Source: BBC Chinese, May 19, 2011
http://www.bbc.co.uk/zhongwen/simp/chinese_news/2011/05/110519_baidu_lawsuit.shtml

Briefings | | May 24, 2011 | Information/Technology

RMB Internationalization Faces Limitations

China Review News (CRN) republished a State Information Center (SIC) article on constraints to the process of internationalizing China’s currency, the RMB. The article suggested that this process will be a long one and is constrained by four main limitations: 1) the limitation of the economic development model and structure; 2) the limitation on the degree of the Chinese central bank’s independent decision making power; 3) the limitation of the international financial market’s conditions; 4) the limitation of the cross-border money exchange mechanism. The article expressed the belief that RMB internationalization is an important symbol of China’s movement toward becoming a strong financial power. However, the journey ahead requires heavy work on building a monetary system.

Source: China Review News, May 20, 2011
http://gb.chinareviewnews.com/doc/1016/9/9/5/101699564.html?coluid=53&kindid=0&docid=101699564&mdate=0520063632

Briefings | | May 24, 2011 | Economy/Resources

Potential Security Issue with Chinese Foreign Assets

A recent Xinhua article discussed the security of China’s foreign assets. With the Chinese government’s “Going Out” strategy, many Chinese companies’ sped up their international investment process, resulting in large overseas assets. By the end of 2009, the total amount exceeded 4 trillion yuan. The recent Libyan situation highlighted the issue of the security of these assets. Although the workers returned home, the investment and assets there remain unprotected. Experts suggest that international investments involve two types of risks. One is market risks, such as price changes; the other is non-market related, such as government regulations and terrorist attacks. Many Chinese companies “rushed out” without proper preparation, such as insurance. The article called for improved risk management.

Source: Xinhua, May 21, 2011
http://news.xinhuanet.com/2011-05/21/c_121442871.htm

Briefings | | May 24, 2011 | Economy/Resources

China’s Reaction to Trump’s Election Win

Xinhua Commentary Series: Spotlight on the U.S. Presidential Election

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