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

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

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

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

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NPC Report: Forty Percent of the Online Goods Are Counterfeit

BBC Chinese recently reported that the Chinese National People’s Congress (NPC) Standing Committee published an official report that its Law Enforcement Inspection Team had authored. The Inspection Report was the result of an investigation based on the Consumer Protection Law. According to the Report, the Chinese online shopping market is growing rapidly. However, the Report expressed the belief that over forty percent of the products sold online are counterfeit. These counterfeit products have deeply impacted the health of the e-commerce market. They usually violate the rights of the legitimate original owner of the design or the brand. This issue has been causing major headaches for foreign companies that have wanted to enter the Chinese market. The largest Chinese online retailer Alibaba had to put forth a major effort to lobby the U.S. government to avoid having the United States blacklist it. 

Source: BBC Chinese, November 3, 2015
http://www.bbc.com/zhongwen/simp/business/2015/11/151103_china_counterfeit_goods
Briefings | | |   Economy/Resources

Caixin: Chinese Manufacturing PMI Remains Low

Well-known Chinese financial site Caixin recently released its official Chinese Manufacturing PMI index number for October, which was 48.3. Caixin PMI was formerly known as HSBC PMI, which was a well-respected economic indicator monitored globally by financial institutions. The Caixin PMI has been below 50 for eight consecutive months. The sub-indexes under the Caixin Manufacturing PMI show that the overall Chinese manufacturing industry remains weak. However, the number of new export orders saw a rebound in October. Even so, the total number of orders for Chinese exports for October is still expected to suffer a decline of -3.7 percent, year-over-year. The employment level in manufacturing continued to shrink despite the increase in the services industry. PMI (Purchasing Managers Index) is an indicator of financial activity reflecting purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline. 
Source: Caixin, November 4, 2015
http://pmi.caixin.com/2015-11-04/100869757.html
Briefings | | |   Economy/Resources

Xinhua: Five Unique Features of the Third Round of the Disciplinary Inspection Tour

Xinhua published an article on the third round of the tour that The Central Leading Group for Inspection Work conducted. The article highlighted five key features that are unique to this tour. 1) Among 31 companies or institutions to be inspected, 21 are financial institutions. Therefore the third round of the tour is also called the “Finance anti-corruption campaign.” 2) The head of the team members of the inspection group have extensive experience in both the discipline inspection work area and in their knowledge of finance. 3) The target of the inspection work is the Party organization and Party officials in the work unit and whether they carry out the directions that the central administration has issued. The focus is not on the operational part of the business. 4) Each inspection team will visit two companies and one inspection team will need to visit three companies. The inspection teams are expected to identify common issues and apply serious disciplinary measures to those who fail to deal with problems after they have been given advanced warnings. The effort is to show the determination of the central administration in dealing with disciplinary violations. 5) Those selected companies have expressed full cooperation with the inspection work and have issued statements to show zero tolerance for any violations while the inspection team is on site.

Source: Xinhua, November 6, 2015
http://news.xinhuanet.com/politics/2015-11/06/c_1117067924.htm

Briefings | | |   Government/Politics

Aging Population to Accelerate in China; 70 Percent of Seniors are Empty Nesters

Guangming Daily reported that the National Senior Council published an estimate that, from 2015 to 2035, the senior population will increase by 10 million people each year. Currently 70 percent of the seniors in the middle to large cities are empty nesters. The statistics from the Council also indicated that China will enter into a period in which the growth in the number in China’s aging population will accelerate. The estimated growth from 2015 to 2035 was from 212 million to 418 million.

Source: Guangming Daily, November 9, 2015
http://politics.gmw.cn/2015-11/09/content_17653952.htm

Briefings | | |   Social Stability

The Social and Population Structure in Beijing Needs Improvement

Guangming Daily recently published an article on the results of a survey that was reported in the 2015 Beijing Society Bluebook. According to the statistics in the Blue Book, the social and population structure in Beijing still needs to be improved. The results showed that, in 2010, the middle class accounted for 35.85 percent of the population and the lower class accounted for 61.17 percent. The Blue Book estimated that, in 2015, the middle class grew to 40 percent of the population and could reach 50 percent by 2025. As to the quality of the population, Beijing still sees a shortage in the area of finding and keeping talent in the city. The population also sees an imbalance between the sexes. The Blue Book noted that 60 percent of the college graduates who took the survey, but who have resident status outside of Beijing, indicated that they plan to leave Beijing in the future due to the high cost of living or the lack of professional growth and financial improvement opportunities.

Source: Guangming Daily, November 6, 2015
http://economy.gmw.cn/2015-11/06/content_17627403.htm

Briefings | | |   Social Stability

How Money Flees China

On November 4, 2015, Laohucaijing published a report on how money flees China. The article stated that, typically, the newly wealthy Chinese use seven different ways to transfer their assets from China overseas.

To use a Hong Kong underground exchange for the transfer, the mainland Chinese client first visits Hong Kong and opens a bank account. Then he visits a currency exchange that provides him an account in mainland China. Once this mainland China account receives yuan, the bank account in Hong Kong receives the equivalent in foreign exchange. 
Another method is for the mainland Chinese client first to deposit yuan in a Chinese underground bank which then provides a foreign exchange check drawn on a Hong Kong bank. The client will then visit Hong Kong to cash the check. 
Another method involves local currency exchange agents in China. They secure enough people who will use their residence cards to exchange up to $50,000 per residence card and then remit the foreign exchange directly overseas. Some people just carry foreign exchange in cash when travelling overseas. One of the State-owned commercial banks, Construction Bank, now offers a service that allows clients to borrow foreign exchanges against the yuan deposit at the Construction Bank as collateral. For Chinese tourists, many use credit cards or debit cards to “purchase” high dollar items in a designated store overseas, and then immediate ask for refund. The store will then pay the refund in cash rather than to the card used for the purchase. Import and export trading companies often engage in such money laundering as a side business. 
Source: Laohucaijin, November 4, 2015 
http://www.laohucaijing.com/news/111117/
Briefings | | |   Economy/Resources

Zeng Qinghong’s Niece No Longer Serves as a Government or Party Official

According to an article published in The Paper, on November 3, 2015, Wang Xiaoling, the niece of Zeng Qinghong’s wife, no longer serves as a Guangzhou Municipal Standing Committee member and the Party Secretary of the City Commission for Discipline Inspection. Zeng Qinghong is the Chinese regime’s former vice chair and a member of the Chinese Communist Party (CCP) Politburo Standing Committee. In the 1990s, Zeng was well known as a close ally and the right-hand-man of Jiang Zemin, the former CCP General Secretary and the Chinese regime’s former chairman.

According to Hong Kong Apple on July 22, 2015, Wang Xiaoling was promoted from her position as a nurse in the army and a clerk in a Trade and Industry Bureau to become the Guangzhou Municipal Deputy Mayor. Her position improved in just a few years because of Zeng Qinghong’s high ranking position. In the most recent two years, she was suspected in getting involved in corruption. Zeng Qinghong is also in trouble in the current CCP anti-corruption campaign. The Guangdong Provincial Committee has no intention of promoting Wang any further as she is 60 years old. According to the CCP’s rules, that is the age for a female cadre to retire if no more promotions are given. Zeng advised her to retire completely so as to avoid a “bad ending.”

Sources: The Paper, November 3, 2015; Hong Kong Apple, July 22, 2015
http://www.thepaper.cn/newsDetail_forward_1392473
http://hk.apple.nextmedia.com/realtime/china/20150722/54004420

Briefings | | |   Government/Politics

China’s Financial Institutions Are Being Investigated for Corruption

State media Huanqiu reported that Zhang Yun, president of the Agricultural Bank of China has been taken into custody because of inquiries into corruption. The Agricultural Bank of China is one of the four State-owned commercial banks. The other three banks are the Industrial and Commercial Bank of China, the China Construction Bank, and the Bank of China. 

According to Huanqiu, those in senior management at the four State-owned commercial banks are worried because the number of whistleblowers inside the banks is surging. Following what happened at the Agricultural Bank of China, there will be more “disappearances” in other financial institutions. However, it is certain that those who “disappear” will not be able to flee China. 
Huanqiu also reported that those in mid to high level management in China’s financial institutions have been warned that they cannot resign, retire, or leave China. 
Starting in late October, the CCP’s Central Commission for Discipline Inspection (CCDI) sent inspection teams to conduct investigations into corruption at the China Banking Regulatory Commission, the China Securities Regulatory Commission, the People’s Bank of China, the China Insurance Regulatory Commission, the four State-owned commercial banks, and major insurance companies. A total of 31 financial institutions were to be investigated. 
Source: Huanqiu, November 2, 2015 
http://china.huanqiu.com/article/2015-11/7893276.html
Briefings | | |   Government/Politics