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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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China Is Considering Merging PetroChina and Sinopec

Well-known Chinese News Site Sina recently reported that the Chinese government is considering a merger between the top two largest state-owned oil companies – PetroChina and Sinopec. The goal is to establish a “champion” oil company that can practically challenge ExxonMobil and increase oil production efficiency in an era that’s suffering low oil prices. Unnamed Chinese officials said there are multiple options and there is no final decision or timetable yet. As the Chinese economy is slowing down, the Chinese government is planning significant reforms to major state-owned companies in order to improve their global competitiveness. Although the government has been opening up more and more industries (such as infrastructure, natural resources and banking) to private investment, President Xi Jinping stated last year that the state-owned companies are still “an important pillar of the nation’s economy.” Heavy competition among similar state-owned companies is identified as one of the main problems in developing healthy overseas markets. PetroChina has 550,000 employees globally, which is seven times the employee count of ExxonMobil. However its 2013 revenue was US$361 billion, which was much lower than ExxonMobil’s US$420 billion. 
Source: Sina, February 17, 2015
http://finance.sina.com.cn/stock/usstock/c/20150217/204821572981.shtml
Briefings | | |   Economy/Resources

BBC Chinese: Greece to Participate in China’s New Maritime Silk Road

BBC Chinese recently reported that, during the Eighteenth Chinese Naval Escort Fleet’s four-day visit to Greece, Greek Prime Minister Alexis Tsipras boarded a Chinese Naval warship to attend a Chinese New Year’s reception. Tsipras delivered a speech that suggested the visit and the joint naval exercise represented the start of a new era. He also said his government gave a high priority to supporting China’s investments in Greece and agreed that the country will participate in the New Maritime Silk Road plan. Tsipras emphasized that he expects Greece to become the primary entry point to Europe for Chinese goods. The New Maritime Silk Road plan was first announced by Chinese President Xi Jinping in the fall of 2013. 
Source: BBC Chinese, February 21, 2015
http://www.bbc.co.uk/zhongwen/simp/world/2015/02/150221_tsipras_greece_china_cooperation
http://www.bbc.co.uk/zhongwen/simp/world/2015/02/150219_greece_china_eu
Briefings | | |   Geo-Strategic Trend

China’s Coal Industry Is Facing a Tough Time

China Economy reported that 2014 was a bad year for China’s coal companies. China’s Coal Industry Association issued a release stating that, in the first 11 months of 2014, profits fell by 44.4 percent and losses increased by 61.6 percent when compared to same period in 2013; 70 percent of coal companies were in the red. China completed 3.52 billion tons of coal production, which was a 2.1 percent reduction from a year ago. It was the first decline since the year 2000. On the one hand, coal consumption continues to decline. On the other, the companies have excess capacity and operational difficulties. According to China Economy, this will be the new norm for the future of the coal industry. 

Source: China Economy, February 21, 2015 http://www.ce.cn/cysc/ny/gdxw/201502/21/t20150221_4630603.shtml
Briefings | | |   Economy/Resources

Shenzhen Becomes World’s First Friendship City with Berne of Switzerland

As Switzerland as a nation strengthens its ties with China, China’s Shenzhen has become the first Friendship City for its canton of Berne.
The free trade treaty between China and Switzerland took effect last summer. In late January this year, Chinese premier Li Keqiang visited Switzerland. Then in early February, the Swiss Treasury Minister reciprocated the visit in order to promote bilateral cooperation for the internationalization of the Chinese yuan. After two years of communication and preparation, the Swiss canton of Berne formally became a Friendship City with the city of Shenzhen, the most important industrial and economic city in southern China. Since it is the first Friendship City for Berne globally, the story was widely covered in Switzerland. Berne is the second most populous canton in the country. Its industrial structure bears high similarities with Shenzhen. Products include precision instruments, watches and clocks, medical and life sciences, finance, and technology.
Source: Radio Free Asia, February 20, 2015
http://www.rfa.org/mandarin/yataibaodao/junshiwaijiao/gr-02202015103128.html
Briefings | | |   Geo-Strategic Trend

Qiushi: The Dividends of Hegemony: America’s Source for Reaping without Sowing

Qiushi recently republished a Red Flag Manuscript article with the title, “The Dividends of Hegemony: America’s Source for Reaping without Sowing.” Two researchers, Yang Duogui and Zhou Zhitian, from the Science and Technology Policy and Management Institute of the Chinese Academy of Sciences were the authors. 

The article said, “Since 500 years ago, from Portugal, Spain, and the Netherlands to England, and then to the United States, state ‘hegemony’ has gradually developed from the traditional ‘territorial colonization’ into a modern ‘financial colonization.’ Today, for the U.S., as the world’s only superpower, financial colonization is its core secret for maintaining its hegemony power. For the Americans, financial hegemony has become the cornerstone for the United States to be able to obtain its hegemony dividend. It is the source for reaping profits without sowing.” 
The article summarized the following ten major ways and channels the U.S. uses to harvest its “hegemony dividends”: 1) Seigniorage. The author calculated that “assuming that all of China’s foreign exchange reserves are held in U.S. Treasury bonds and the interest spread between U.S. Treasury bonds and China Treasury bonds is one percent, then each year the United States will get about US$ 23-26 billion in seigniorage at a minimum from China’s economic development without paying any costs.” 2) International inflation tax revenue; 3) Earnings from [issuing] debts; 4) Overseas investment income; 5) Fee income from dollar transactions; 6) Unfair trade gains; 7) Currency manipulation of earnings; 8) Financial derivative gains; 9) Returns from big item Commodity futures; 10) Income from intellectual property.
Source: Qiushi Journal, February 6, 2015 
http://www.qstheory.cn/dukan/hqwg/2015-02/06/c_1114285652.htm

Briefings | | |   US-China Relations

Qiushi: State Owned Enterprises Should Return More Profits to the State

Qiushi published an article advocating that State-owned enterprises should provide “social dividends” by returning more profits to the State and by increasing the amount of funds used for public benefits. 

According to the article, the economy has been experiencing downward pressure. To increase fiscal revenue, state-own enterprises must increase their “social dividends” in addition to their taxes. The article made the following observations.
First, the profits submitted to the central government have not been expended properly. For example, in 2014, only 18.4 billion yuan (US$2.94 billion) went to pay for social security expenses, while 120 billion yuan ($US 19.19 billion) went back to the State-owned enterprises. More profits should be paid into the State coffers. 
Second, currently the maximum amount that enterprises submit to the State coffers is about 15 to 25 percent of their profits. In the West, about 30 to 40 percent of the profits are for dividends to be distributed to shareholders. 
Third, of 5,000 State-owned enterprises, only 799 are included in the national budget and are required to submit their profits to the State. Particularly, the highly profitable State-owned enterprises in the financial sector are not required to submit their profits to the State coffers at all. 
Source: Qiushi, February 17, 2015 
http://www.qstheory.cn/economy/2015-02/17/c_1114398141.htm
Briefings | | |   Economy/Resources

Eight Diseases in China’s Judicial System

According to Song Hansong, Director of the Office of Crime Prevention, China’s Supreme People’s Procuratorate, there are eight “chronic diseases” in the judicial system in China.

1.) Personnel working in the judicial system are crude, arrogant, overbearing, perfunctory, and not responsive.
2.) Procedures and rules are not followed in interrogations and when using residential surveillance. 
3.) Judges do not follow the law and listen to the views of the parties and the lawyers. They intentionally make things difficult, unreasonably delay the process, or unlawfully restrict the rights of the lawyers. 
4.) Illegal coercive measures are used to obtain evidence illegally and to confiscate property in spite of the legitimate interests of the parties. 
5.) In order to obtain a good performance evaluation, cases are handled in violation of the law and with fraudulent treatment. 
6.) investigators engage in ultra vires [activities beyond their legal power and authority] and in illegal economic and business activities. 
7.) Judges have ex parte communications with the parties and lawyers, disclose or inquire about the issues in the case, and intervene in the judicial process. 
8.) Judges take bribes and decide the cases on the basis of relationships and money. 
Source: Qiushi, February 15, 2015 
http://www.qstheory.cn/politics/2015-02/15/c_1114374295.htm
Briefings | | |   Government/Politics

Xinhua: U.S. NSA Installs Spyware on Hard Disks So They Can Eavesdrop on Most Computers Worldwide

Xinhua recently reported, in its International Section’s headline news, that the U.S. National Security Agency (NSA) has made a technological breakthrough. It is installing spyware that will be hidden in Western Digital, Seagate, and Toshiba Corp.’s hard disks enabling them to eavesdrop on most computers in the world. The report indicated that multiple Internet researchers and former agents have acknowledged this. 

According to the report, the Russian security firm Kaspersky Labs, headquartered in Moscow, exposed this spy action on the 16th [of February, 2015]. It further said, “Although Kaspersky Labs refused to disclose publicly the country that was taking this behind the scenes spy action, it said it is closely related to the ‘Stuxnet’ virus. The ‘Stuxnet’ virus was a cyberwar weapon developed under the direction of the U.S. National Security Agency and was used to attack Iran’s uranium enrichment facilities.” 
Source: Xinhua, February 18, 2015 
http://news.xinhuanet.com/world/2015-02/18/c_127506544.htm

Briefings | | |   US-China Relations