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Huanqiu: Philippine’s Secretary of Foreign Affairs Astonished the Media

Huanqiu reported that Alan Peter Cayetano, the Philippine’s Secretary of Foreign Affairs, held a press conference on August 8, after the ASEAN Foreign Ministers’ Conference. His comments on the South China Sea issue astonished the media.

According to Huanqiu, “Cayetano said that China has played an ‘active role’ in the ASEAN region. China’s rapid economic growth has benefitted all ASEAN countries. The Philippines ‘is proud’ of the current Sino-Philippine relationship.”

A news reporter asked if the Philippines wanted to add tough words towards China in the ASEAN Foreign Ministers’ joint statement on the South China Sea.

Cayetano stated that he didn’t want to add them. “I drafted the statement. (Adding tough words against China) does not reflect the current situation.”

The reporter followed up with asking why he did not want to add those words.

Cayetano cut the question off, asking, “Are you saying that we should embarrass China and then the Philippines should start a confrontation with China?” “Or should we let the South China Sea keep peace and stability and to pass the ‘South China Sea Code of Conduct successfully? … What is your goal?”

A CNN Philippines reporter asked why Philippine didn’t mention the “South China Sea Arbitration’ in the joint statement. Cayetano answered blankly, “Because it has no purpose in the development of Sino-Philippine relations.” “Do you want us to maintain the tough position and thus maintain the tension in the South China Sea, or get the current result via diplomatic channels?” “You tell me, which way better protects Filipinos’ interests and better protects the Philippine’s fishermen?”

“You asked me why I didn’t mention the South China Sea arbitrage.”

“My answer is that it is in the Philippine’s state interest.”

“What we need to do is to establish trust with China via friendly channels. That is in our state interest.”

Source: Huanqiu, August 10, 2017
http://world.huanqiu.com/article/2017-08/11108198.html

VOA: China’s SOEs in Hong Kong Openly Establish Party Structure

Voice of America (VOA) reported that China has recently taken off the veil and is openly establishing the Communist Party structure in its State Owned Enterprises (SOEs) that are listed on the Hong Kong Stock Exchange.

“From 2016 through July 2017, at least 32 of China’s SOEs listed in Hong Kong proposed to adjust their corporate governance structure to include articles that formally establish the Chinese Communist Party (CCP) Committee within the company. It has become particularly obvious in the past few months.”

The Industrial and Commercial Bank of China (ICBC) passed amendments to its by-laws in June 2017, including the following articles:

“According to the ‘Constitution of the Chinese Communist Party’ and the ‘Company Law,’ (ICBC decides to) establish the CCP’s organization (within the company).”

“The CCP Party Committee will have one Party Secretary, two Deputy Secretaries, and a few Party Committee members. The Chairman of the Board and the Party Secretary should be the same person.”

In their by-laws, other SOEs, including CITIC Securities, Sinopec, and other steel and energy companies, also defined the CCP’s leadership role in the company. These 32 companies have a collective market value of over US$1 trillion.

Since it attained power in China in 1949, the CCP has always firmly controlled China’s SOEs.

In 2001, shortly after China joined the WTO, China extended the CCP’s control to private companies. It required that any private company that had three or more CCP members as employees must establish a Party Branch or Committee within the company.

Walmart China and other foreign enterprises in China established CCP Branches around 2006.

Source: VOA, August 15, 2017
https://www.voachinese.com/a/china-firms-in-hongkong-20170815/3986965.html

The Paper: List of Army Commanders Published

A Chinese media, The Paper, published an official list of the commanders and political commissars of each of the 13 Armies of the People’s Liberation Army (PLA).

It also stated, “During this round of military reform, the PLA cut over 1,000 units at the Regimental level or above. It cut nearly half of the non-combat staff and 30 percent of officers. It deployed a few dozen military units and all of them moved out in three days. A few hundred generals were re-assigned to different posts and they all reported to their new office on the same day they received the order.”

Source: The Paper, August 16, 2017
http://www.thepaper.cn/newsDetail_forward_1765430

Since the Start of 2017, Chinese Overseas Real Estate Investment Declined 84 Percent

Hong Kong’s Mainland-backed Phoenix New Media recently reported that, based on an analysis that Morgan Stanley Chase completed, the commercial real estate markets in New York, Sydney, and London may face serious challenges in the next two years. The primary cause of this warning is that Chinese investors have started withdrawing from overseas real estate markets. The Chinese government is tightening up capital control and commercial loans very quickly. Statistics showed that, since the beginning of 2017, the total of Chinese overseas real estate investment has declined 84 percent. The expectation is that an additional 18 percent drop will continue into year 2018. The same 2017 number that the Chinese Ministry of Commerce released was an 82 percent decline. According to statistics that the Chinese banking industry published, in the first half of this year, China’s total direct investment overseas showed a decline of 45.8 percent, to US$48 billion. In the second quarter, real estate pricing in Manhattan had already dropped 25 percent.

Source: Phoenix New Media, August 14, 2017
http://finance.ifeng.com/a/20170814/15580536_0.shtml

China Responded to U.S. Religious Freedom Report: Mind Your Own Business

China Central Television (CCTV) recently published a commentary on its official website responding to the Religious Freedom Annual Report that the U.S. State Department just released. The report pointed out that China, along with six other countries, had a bad record on respecting religious freedom. The Chinese government officially described this Report as “ignoring the facts and being flat out wrong.” The commentary used the recent Charlottesville, Virginia incident as an example of the “chaotic situation” inside the United States. The author suggested that the U.S. really has no moral authority to judge other countries. Even the U.S.’s own industrial leaders in the area of manufacturing resigned from the Trump Manufacturing Council. The commentator urged the U.S. government to give up its attempt to interfere with other nations’ internal affairs in the name of religious freedom and stated that, “Americans should really just mind their own business.”

Source: CCTV, August 16, 2017
http://news.cctv.com/2017/08/16/ARTIUUTVFyYRGdtDpwqJbF44170816.shtml

China Withdraws Industrial Equipment from North Korean Rason Area

The DailyNK, a South Korean news site that focuses on North Korean activities, recently reported, based on its own sources, that hundreds of trucks filled with industrial equipment from the Rason region were lining up outside of Chinese customs, waiting to return to China. This occurred the second day after China banned two thirds of North Korea’s export products based on the UN sanctions resolution. The Chinese government has not yet ordered the evacuation of industrial factories. However, the Chinese factory managers in those factories have been very much concerned about the potential of becoming the target of North Korean retaliation. Locals worried that, if this trend continues, Rason city could quickly become an empty town. At the moment, many Chinese factory owners are still busy looking for trucks. Not long ago, China unexpectedly supported UN Resolution 2371. This move caused quite a few complaints among Chinese investors in North Korea since they were caught unprepared.

Source: DailyNK, August 17, 2017
http://www.dailynk.com/chinese/read.php?cataId=nk00600&num=15705

Duowei: Beidaihe Meeting Ended Quietly – China Is Free of the “Elder Statesman Politics”

According to an article that Duowei published, the outcome from the recent Beidaihe meeting or “summer summit” indicated that Beijing has finished the final stretch of the preparation that has been planned for the upcoming 19th People’s Congress. One unique phenomenon that materialized at this meeting was the “silence” that the elderly members of the Communist Party of China, who held substantial power during the 1980s and 1990s, displayed, compared to the 18th National Congress in 2012 when several of the elderly members made frequent appearances prior to the conference. The article quoted another Duowei article which stated that it was an indication that China (Xi Jinping) is almost free of “elder statesman politics.” However it does not mean that the elderly members are completely out of the picture. One example is Jiang Zemin, who had his 91st birthday on August 17. His health has always been a subject of the public’s attention. The article stated that one of the major agenda items to watch for in the 19th National Congress is the personnel changes and whether Wang Qishan, a member of the seven-man Politburo Standing Committee will still remain in power.

Source: Duowei, August 19, 2017
http://news.dwnews.com/china/news/2017-08-19/60007772.html

State Council Issues Guidelines on Overseas Investments

On August 4, the State Council published a guideline on its website about overseas investments. The Commerce Department of the National Development and Reform Commission, the Bank of China, and the Ministry of Foreign Affairs developed the guideline. The guideline encourages investments that will promote international cooperation, improve research and manufacturing capabilities, compensate for the domestic energy shortage, and improve quality.

The guideline listed investment fields that the State supports: projects that promote the “one belt one road” and infrastructure construction in the region; the export of domestic high quality equipment and technology; the enhancement of cooperation with foreign high tech companies and those with advanced manufacturing technology; the setting up of foreign research centers; natural gas and resources exploration and the development, after careful evaluation, of economic benefits; advances in cooperation in agriculture and the launch of projects that have mutual benefits; and supporting qualified financial agencies to set up branch offices overseas.

The article also listed the areas that are limited in foreign investment: countries with which China does not have foreign diplomatic relations; regions involved in wars; real estate, hotels, movie theaters, or entertainment; sports clubs; investment funds that don’t have a specific project; and technology, environmental standards, energy indexes and safety regulations that do not meet the requirements of the investing country.

The areas that are prohibited in regards to foreign investment include military technology and products that are not approved by the State; technology, skilled products or those that are banned from being exported; gambling and prostitution; and investments banned in accordance with international standards or which endanger the nation’s security interests.

Source: Gov.cn, August 18, 2017
http://www.gov.cn/zhengce/content/2017-08/18/content_5218665.htm