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Xinhua: China’s Foreign Relations Entering Golden Stage

As part of the theme to celebrate the achievement of the open door policy adopted 30 years ago, Xinhua has been publishing a series of articles focused on the subject. On December 1, in its international section, Xinhua published a talk given by Wu Jianmin, a commentator for Xinhua, former Chinese ambassador to France and President of the China Foreign Affairs University who summarized the major changes that China’s foreign relations have gone through in the past 30 years ago.

Wu summarized the major changes in the following three areas: worldwide environment, policy adjustment, and the focus. He said that the world has transitioned from war and revolution towards an era of peaceful development. From 1949 to 1978, China’s foreign policy was focused on surviving the embargo from the western countries led by the US which was aimed at eliminating China. But since 1978, as China has adopted an open door policy and the Party has shifted its focus to economic development, there has been a need to maintain a good relationship with other countries. As a result, the guiding principle of foreign policy has changed to seeking the common ground with other countries. The focus of the policy has also shifted from fighting for survival towards building mutual cooperation since China has a need for it.

“Currently China’s foreign relations are entering a golden stage”, Wu said, “we have formed dynamic relationships with 172 countries that are the giants, neighboring countries, developing countries and maintained the multilateral foreign relations with them.”

Source: Xinhua, December 1, 2008
http://news.xinhuanet.com/world/2008-12/01/content_10436728.htm

Financial Risk Transfer – U.S. Kills Buddies

International Herald Leader under Xinhua published an article on October 6 on the U.S. economic policy under the situation of the world financial crisis. [1]
On October 3, the U.S. Congress passed the $850 billion financial rescue package. President Bush was relieved with a smile on his face, but led Chinese experts to worry.

US Assets Melting Down

 “The United States has always asked the whole world to bear the U.S. difficulties. It won’t be an exception for this time.” Zhou Shijian, Senior Research Analyst of the US-China Research Center of Qinghua University, told the reporter in an interview. Since the World War II, the United States has been issuing large amount of U.S. dollars (cash) and issuing national debt to resolve its economic crises. However, these methods, to certain extent, amount to transferring the risks to other countries including China.

Lu Qianjin, Associate Professor from Department of International Finance of Fudan University, said the main source of the rescue package issued by the United States was increasing national debts; it would make the financial deficit even worse, consequently, increasing the deficit in trade. It could hinder the growth of U.S. dollars and potentially force the dollar back to the depreciation track.

 “If the dollar depreciates, the price of the future oil products will remain high, and it poses the risk of asset melting down for the countries that hold U.S. assets.” Lu Qianjin said. At the same time, Lu said: “these countries will also face the same risk of asset melting down if the United States is to reduce its debt by depreciating the dollars.”

 “$850 billion rescue package is like purchasing medicines from the world to cure the U.S. disease.” Zhou Shijian told International Herald Leader. Currently, there is only one third of the U.S. dollars circulating within the United States. According to the report from the U.S. Treasury Department, China is the second largest holder of the U.S. debts.
   
Companies in China Are Suffering “US Default”

In reality, since the financial crisis started, the U.S. has been transferring its crisis to others. Zhou Shijian is using word of “killing buddies” to describe the U.S. behavior. “Europe has the best relationship with the United States, now Europe is in a crisis. The next is Japan, and then China” Zhou Shijian said.

Lu Qianjin said, China is not only facing the risk of dollar depreciation and bankruptcy of the U.S. financial institutes, it also faces the risk of the U.S. companies transferring their losses by defaulting on payments.

Currently, there are thousands of companies in Zhejiang Province facing default of the U.S. companies. The financial crisis has caused the decline in consumers’ spending in the United States.  Importers could not get their cash collected and the cash flow fell short. In addition, banks have tightened up their loans. Importers could not get their loans easily. Some importers announced bankruptcy after their cash flow broke, as a result, the companies in China could not get their payments for goods exported to the United States.

 “The U.S. companies have actually transferred their losses [to Chinese companies].” Lu Qianjin said.

Psychological Impact Could Not be Ignored

Tan Yaling, from the China financial research center of Beijing University, said in this financial crisis, through proactive adjustment, the U.S. has moved from reaction mode to pro-action mode and has transferred its loss to others.

 “The United States has a mature economy.  Many of its actions are strategic and foreseeing.  Sometimes, it uses the psychological factors to influence countries like China and to transfer its risks.” Tan Yaling said that  the U.S. stock market is going downward, however, the U.S. dollar index is going up.  “It is very abnormal. Therefore, you could see the U.S. strategies coordinate very well as planned.”

Tan Yaling said further that the dollar strengthening is to meet the need of inbound asset flow to the US. “It satisfies the market need in this special period,” at the same time, the U.S. is using the fluctuation of its stock market to throw the world into crisis. Even on the same day of the rescue package approval, the stock market dropped.

“Why it could be this way.  October 3 was Friday and the Chinese market closed for that week. On Monday before we open the market, we must check the U.S. market.” Tan Yaling said.

Tan Yaling told International Herald Leader, “by self-adjustment, the U.S. is using the psychological factors and policies to influence the market development in other countries.” The U.S. is not stronger than others, but rather behaved worse than others.

Or to Expand the Export of the Military Products

Because the rescue package costs $850 billion, the U.S. has to pay a huge amount of interest in the future. Lu Qianjin said that to make up this big hole, the U.S. could expand its export in military products.

 “There would be strong opposition if the U.S. government wants to tighten up the belt of its own people to solve the problem by increasing the taxes. One may have seen the opposition during the process of negotiating the rescue package.” Lu Qianjin said that another way of improving the economy and lessening the financial pressure would be to expand exports to increase income and tax revenue. “Especially expanding the export of military products is a fast and effective way of relieving the financial pressure in the US.”

Currently, the U.S. government has started to sell military products to Taiwan and the total amount will be $6.46 billion. “In the future, the United States may use future geo-political conflicts or the alleged potential military threats to expand exports of military products to certain countries and areas, hoping Exports of Munitions would alleviate domestic economic problems.” Lu Qianjin predicted.

Endnote:
[1] International Herald Leader, October 6, 2008  http://news.xinhuanet.com/herald/2008-10/06/content_10154827.htm

International Herald Leader: The U.S. Fabricated the Chinese ‘rospace Spy

On October 6, 2008, the International Herald Leader, a subsidiary of Xinhua News Agency, published a respondent to the arrest and lawsuit against the Chinese-American physicist, Shu Quansheng, Ph.D., by the U.S. Federal Bureau of Investigation (FBI) [1]
LOS ANGELES, BEIJING — While the Chinese around the world joyfully celebrated the launching of Shenzhou VII, the news of "The Chinese Aerospace Spy Arrested," came out from the other side of the Pacific Ocean, the United States. On the early morning of September 24, 2008, the FBI arrested the Chinese-American physicist, Shu Quansheng, Ph.D., the President and CEO of the U.S. AMAC International Inc., in Norfolk, Virginia.

The FBI filed three indictments against Shu Quansheng: Illegally provided the defense service to the foreign agents in violation of the U.S. "Weapon Export Control Law," exported defense goods, and bribed or attempted to bribe foreign government officials in violation of the U.S. "Foreign Corruption Law, respectively." If all of these charges were convicted, Shu Quansheng would face up to a 25-year of imprisonments.

The Chinese-American Scientist Was Accused of Selling Technology

The FBI indictments indicated that Shu Quansheng provided professional technology to the aerospace plans; assisted the purchase of foreign technology, and the improvement of the aerospace and the satellite abilities of China. The FBI official stated that Shu Quansheng was suspicious of providing the technology that "will be used to implement the plans for future lunar landing and the new generation rocket fuel for its space station plans of China." The indictments indicated that since 2003, Shu Quansheng has sold the technology of developing the liquefaction hydrogen rockets to China, and provided the low-temperature pump, the low-temperature valve and the refrigeration equipment related to the liquefied hydrogen technologies for the construction of astronautics launch station in Hainan Province, China, all of them violated the "Weapon Export Control Law."

After the turmoil 1989-political movement, the U.S. implemented the weapon embargo against China, and it is prohibited to sell the high-tech products to the Chinese military departments. This prohibition is still effective and has become the prosecution legal basis for the law enforcement authority to investigate the Chinese-American espionage case.

At NASA, A Person of Great Merit, Earns High Prestige in the U.S.

The 68-years-old Shu Quansheng was born in Shanghai, China. He is a well-known scholar at the areas of accelerator, superconductivity and cryogenics, and has earned high prestige in the American scientific community. On October 5, 2008, the International Herald Leader called the office of AMAC Beijing branch, but nobody answered. According to the website of the AMAC Beijing branch, Shu Quansheng was the Chairman of the U.S. Applied Superconductivity Conference in 2001, and was a member of the Commerce Committee for President Bush

During the college years, Shu Quansheng majored in Physics. In 1970, after graduated and earned his Ph.D., he started teaching at Zhe Jiang University in China, and was engaged in the cryogenic technique research. In the mid-1980s, Shu Quansheng immigrated to the U.S. and was engaged in the scientific research at Washington University. In 1998, he became an American citizen. In the same year, he founded AMAC in Newport News, Virginia, and became the CEO of the company. 10

AMAC had been granted $4.7 million for research and renovation from the U.S. Department of Energy and NASA because of its outstanding achievements in the areas of superconductivity accelerating cavity, the radio frequency power coupler, the magnetic suspension cryogenic system and the astronautics low temperature. Shu Quansheng had led and completed six projects related to low temperature and superconductivity. According to the website of the AMAC Beijing branch, he developed the first prototype of Cryogenic Transfer Line with Magnetic Suspension in the world from 2001 to 2004. This magnetic suspension technology would improve the launch quality and lengthen the flight life span of the vehicle.

The U.S. Media Implicated the FBI Abused Its Power

The analysis of the aerospace plan of China from an American scholar may explain the intention of the FBI’s publicity of this so-called, "the Chinese Aerospace Spy Case," at the launch of Shenzhou VII. Charles Vick, a senior analyst for GlobalSecurity.org research group, a think tank in the defense information and aerospace research, which is headquartered in Washington, D.C., indicated during the interview that although the military power of China in outer space falls far behind the U.S., China possibly would threaten the leadership position of the U.S. in 15 years as a result of the its fast economy development and the support in aerospace plan of its government.

In fact, the U.S. Department of Justice launched the "The National Anti-Expansion Plan," in 2007, with the main purpose of prohibiting the export of sensitive military or military-civilian technology to China, Iran and so on. However, as early as in 2005, the FBI official publicly declared China as the biggest espionage threat. By now, the U.S. government has already filed at least 20 espionage cases that involved exporting sensitive technology to China. With incessant Chinese spy cases emerging, even the U.S. media, which always pursue sensation, started to suspect the authenticity. When "Forbes" magazine reported the Shu Quansheng case, it mentioned the Li Wen He case in 1999. It pointed out that Li Wen He finally sought the justice and obtained the compensation from the government and the media. It implied that the FBI abused its power during the investigation of the so-called Chinese spy cases.

An anonymous retired Chinese aerospace engineer told the International Herald Leader that the FBI and the other U.S. law enforcement agencies are still keeping the mindsets of the cold war. Their first impressions are that most Chinese technical personnel could be the Chinese spies of which made these Chinese-Americans impossible to protect themselves. The fundamental reason of these "the Chinese Espionage Cases" is the ideology conflicts between the different political systems of the U.S. and China, particularly the U.S. authorities still regard the rising China as the potential enemy. Under the present circumstance that both countries have close ties on economics and technologies, it could be predicted that more so-called "the Chinese Espionage Cases" would emerge.

Endnote:
[1] International Herald Leader, October 6, 2008
http://news.xinhuanet.com/herald/2008-10/06/content_10154808.htm

Hubei Taxi Drivers on Strike to Protest New Government Fee

Since November 24, no taxi has been running in Suizhou City of Hubei Province. The city’s 500+ taxis are parked, with some drivers petitioning in front of the city government.

The strike is said to be caused by a city government directive issued on November 15. It asked for an annual 4,000 yuan “operation fee” from each of the 550 taxi cabs running in the city. The fee is levied for a four year term. If the driver does not pay the money by the end of 2008, the city police will confiscate his license.

Burdened by multiple administrative fees and charges, the taxi drivers are left with a meager disposable income off of which to live. The newly added government charge has become the last straw. The strike has been going on for two days. There is no effective dialogue between the city government and taxi drivers.

Source: Civil Rights and Livelihood Watch, November 25, 2008
http://www.msguancha.com/Article/ShowArticle.asp?ArticleID=1608

Expert: AIDS in China Heading Out of Control

A medical expert in Guangzhou warned on Nov 24 that AIDS in China has entered a stage of being uncontrollable.

An 18-year-old college freshman was recently diagnosed with AIDS in a Guangzhou hospital. According to the doctor, the male student was infected through sexual intercourse.
 
In China, transmission of the deadly disease through sexual activities has dwarfed every other channel of contagion, according to Cai Weiping, an AIDS expert from Guangzhou No. 8 People’s Hospital, in a media interview.

While the liberal attitude toward sex among the younger generation is one of the major reasons for the disease being out of control, migrant workers and the elderly are also vulnerable populations. Although the government has started the AIDS education, the sex workers at the bottom of  society are usually not targeted. Cai said that due to their extremely low income, they cannot afford the cost of condoms.

Source: Nanfang Daily, November 25, 2008
http://www.nanfangdaily.com.cn/nfjx/200811250032.asp

Phoenix TV CEO Receives International Emmy Directorate Award

On November 24, the U.S. Secretary of Labor Department Elaine Chao handed the Directorate Award from the International Emmy Awards to Hong Kong Phoenix TV’s CEO Liu Changle, as a compliment to his work of bringing Phoenix TV to the TV network of more than 150 countries and areas.

[Chinascope note: Pheonix TV has received the nickname of ‘little CCTV’ in some circles, as it shares similar reporting principles on many topics. Because it is based in Hong Kong, viewers in mainland China may regard it as an overseas TV station that is more independent though it follows the Party line on many topics.]

Source: Xinhua, November 25, 2008
http://news.xinhuanet.com/newmedia/2008-11/26/content_10414412.htm

People’s Daily: U.S. New Star Wars Plan Points to China

A blogger of the “Great Nation Forum” from the People’s Daily website published an article discussing the intention of a U.S. plan for developing a space missile defense system. The article says, “U.S. Congress granted five million dollars recently to fund independent research for developing a space missile defense system. The analyst here believes that once the plan is started, it means the "Star Wars Plan” from the 1980s is coming back. This time, the Pentagon’s putative enemies are not only Russia, or Korea and Iran, but also China."

Source: people.com.cn, November 25, 2008
http://military.people.com.cn/GB/42969/58519/8403479.html

Russian Natural Gas and Oil Industrial Company Will Ship 1.2 Million Tons of Oil to China

Deputy General Manager of the Russian Natural Gas and Oil Industrial Company said the company is planning to export 1.2 million tons of oil to China while he was interviewed by Siberia Oil magazine. He said that the company will increase oil exports to China in the future through Kazakhstan, and the Siberia-Pacific Ocean pipeline.

Source: people.com.cn, November 25, 2008
http://world.people.com.cn/GB/57507/8402100.html