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A Showdown and a Face-off

By Dr. Shizhong Chen

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Many who have been holding their breath over the intense showdown in Hong Kong probably missed a leisure moment of entertainment in Beijing.

They should not, for the event in Beijing gave clues to discern the forces that are trying to direct the outcome of the Umbrella Movement.
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Xinhua: Politburo Meeting Sent Important Economic Signals

Xinhua recently reported that the Chinese Communist Party Politburo met on December 5 to discuss focal economic development plans for 2015. The meeting sent significant signals on next year’s roadmap: China must face “the new norm” of economic development focusing more on quality and profitability; the economy must cut a new balance between growth and structural adjustments; strategic new industries and the services industry should become the two new economic engines; the agricultural development model should improve and modernize; regional economic developments should be more balanced across the country; special attention should be given to unemployment and to helping the poor; economic reforms now must to go deeper; international trade should reach a stable balance.
Source: Xinhua, December 5, 2014
http://news.xinhuanet.com/fortune/2014-12/05/c_1113541805.htm

BBC Chinese: Kenyan Authorities Arrested 77 Chinese Suspects

BBC Chinese recently reported from Nairobi, Kenya that the police arrested 77 Chinese citizens for online criminal activities. The police expressed the belief that this criminal group hacked into bank accounts, mobile banking networks, and ATM equipment and networks. They also accused the group of attempting to break into Kenya’s national communications system. The suspects have admitted wrongdoing and turned in the plan they had to attack the national communications system. The prosecutors have sued the members of the group for illegal residence and illegal use of radio equipment without a permit. The Kenyan government contacted the Chinese Embassy to see if the Ambassador was aware of the group’s activities or not. The Chinese government promised to send investigators to assist in the Kenyan investigation. The Chinese Embassy in Kenya proposed that the Chinese government help find out the identities of these suspects. Based on the local reports, the criminal group was producing bank card chips and ran a “command center.”
Source: BBC Chinese, December 4, 2014
http://www.bbc.co.uk/zhongwen/simp/china/2014/12/141204_kenya_chinese_crime

US Retailers Warned of Alibaba’s Impact on Local Businesses

Well-known Chinese news site Sina recently reported that a U.S. business union named Alliance for Main Street Fairness has asked the U.S. Congress to eliminate the special tax benefits afforded to online retailers such as the Chinese vendor Alibaba. In September, Alibaba drew the attention of the U.S. public when it had the largest IPO in U.S. history. The Alliance has the backing of many famous U.S. retailers who are members such as Best Buy, Target, and JC Penny. They are currently running a TV and radio campaign against obvious targets such as Alibaba. Alibaba’s annual online retail sales volume is larger than the two top U.S. market leaders, Amazon and eBay, combined. The large U.S. retailers in the Alliance warned that if Congress does not “plug the hole” in online taxation, Alibaba and company may pretty soon “end” all U.S. local retailers. Alibaba’s core market is Mainland China. It is currently selling products to U.S. consumers via its Aliexpress website. Alibaba pointed out some time back that its focal point is still the Chinese domestic market. As of now Alibaba has not responded to the advertising campaign that its U.S. competitors have launched.
Source: Sina, December 2, 2014
http://finance.sina.com/bg/juhengwang/20141202/00401170031.html

Zhou Yongkang Expelled from the Party and Under Arrest

On December 6, 2014, People’s Daily reported that Zhou Yongkang was expelled from the Communist Party of China (CPC), and is now under arrest as the prosecutors launched an investigation against him. According to People’s Daily, on December 5, 2014, after reviewing the investigation report of the CPC Central Commission for Discipline Inspection (CCDI) against Zhou, the Politburo of the CPC Central Committee reached the decision to expel him. 

Back on December 1, 2013, the CCDI briefed the Standing Committee of the Politburo of the CPC Central Committee about the indications pointing to Zhou’s disciplinary violations. They made a decision to conduct a further examination. On July 29, 2014, the Politburo filed a case for investigation. 
According to a statement that the Politburo issued on December 5, 2014, the CCDI investigation found “Zhou has been in serious violation of the Party’s political, organizational, and confidentiality discipline. He used his official positions to seek personal gain for himself and others and accepted huge bribes personally and through his family. He abused his power to help relatives, mistresses, and friends make huge profits from business activities, resulting in significant losses of state-owned assets. He leaked the Party’s and State’s secrets. He seriously violated self-disciplinary regulations and accepted a large amount of money and property personally and through his family. He committed adultery with a number of women and traded his power for sex and money.” The statement added that the investigation uncovered leads indicating he may have committed other crimes. 

On December 6, 2014, China’s Supreme People’s Procuratorate issued a statement that it has opened an investigation into Zhou’s suspected crimes and decided to arrest him according to the law. 

Sources: People’s Daily, December 6, 2014 
http://paper.people.com.cn/rmrb/html/2014-12/06/nw.D110000renmrb_20141206_5-01.htm http://paper.people.com.cn/rmrb/html/2014-12/06/nw.D110000renmrb_20141206_3-01.htm

What State Secrets did Zhou Yongkang Leak?

One of the findings that the Communist Party Central Commission for Discipline Inspection (CCDI) made in its investigation report against Zhou Yonkang is that Zhou leaked Party and State secrets. As China’s former security czar, what State secrets did he leak? 

Some analysts believe that it refers to Zhou’s leaking information about the corruption of his opponents to the media. It may also include Zhou’s attempt to create chaos and organize counterattacks against his opponents. It could also refer to his immediately giving information to Bo Xilai about Wang Lijun having sought refuge in the U.S. Consulate in Chengdu. Some others thought that the findings referred to Zhou Yongkang leaking state secrets to North Korea’s Kim Jong-un in order for them to collaborate in creating international tensions. 

Source: Epoch Times, December 7, 2014 
http://www.epochtimes.com/gb/14/12/7/n4312884.html

Huanqiu Assails How Freedom House Ranks China on Internet Freedom

Freedom House recently issued the "Freedom on the Net 2014" report, which states that, around the world, the freedom of the Internet continues to backslide, with China, Syria, and Iran ranked at the bottom of the 65 countries and regions that the U.S. human rights organization monitors. As a routine practice, China’s state newspaper Global Times (Huanqiu) retaliated with criticism against Freedom House. Its response follows.
"Western media reported that most of the funding for the organization (Freedom House) is from the United States government and it has a close relationship with the Department of Defense."
"Now that Transparency International’s recently published 2014 Corruption Perceptions Index dropped China’s rank by 20 places, this is another act of Western organizations to make China sick by using ridiculous rankings. However, because this approach completely disregards the bottom line, the intention of these ideological attacks is easily discernable. Such a negative ranking of China has ruined the reputations of Western organizations among the Chinese People."
"After all, Freedom House’s accusation about China’s lack of network freedom is a reflection of the old-fashioned differences in values and politics between the West and China. Such an accusation can also expand to include ‘lack of press freedom,’ ‘deterioration of its human rights record,’ and so on."
"The U.S. based Freedom House takes a country that has achieved one of the most effective developments of the Internet around the world and ranks it third from the bottom. It’s hard to tell whether this is a real shame of China, or of its own. In any case, the Chinese people’s care for the freedom of the Internet is far more than the ‘concerns’ of some Western organizations. Let’s guess: Freedom House is just a front for the United States to influence China’s own policy."
Source: Huanqiu, December 6, 2014
http://opinion.huanqiu.com/editorial/2014-12/5229589.html

Yuan Peng: Sino-U.S. Relations Have Undergone Four Fundamental Changes

Xinhua‘s international channel conducted an interview of Yuan Peng, Associate Dean of the China Institute of Contemporary International Relations (CICIR) regarding the direction in which Sino-U.S. relations are heading. In the interview, Yuan said that "since China launched a new round of reform and opening up, China-U.S. relations have indeed undergone major changes. The three joint communiqués and three joint declarations that guided Sino-U.S. relations in the past may not be sufficient guidelines for the next 35 years."  

Yuan Peng said, "Sino-U.S. relations have undergone four fundamental changes. The first is the change in the balance of power between China and the U.S. China’s GDP jumped from tenth (in the world) at the beginning of the reform and opening to the current second place. The power shift between China and the U.S. is in transition from a quantitative to a qualitative period."  

"The second is the U.S. strategic change. The U.S. has moved its strategic center from Europe to Asia. Despite the Middle Eastern chaos and the Ukrainian crisis, the U.S. has only made some policy adjustments. The ‘Asia-Pacific rebalancing’ change is not merely a tactical one, but a fundamental, strategic change." 

"The third is the change in the strategic foundation for Sino-U.S. relations. China and the U.S. jointly coped with the Soviet Union during the Cold War. Sino-U.S. relations after the Cold War have consisted of economic and trade interests. Now the issue is that the foundation will change and both sides are still struggling to find a new strategic foundation. As of the present, a similar new strategic foundation has not appeared." 

"The fourth is a change in the strategic environment. The external environment of Sino-U.S. relations has become more complex and varied, subject to the influence of third party factors such as the Diaoyu Islands, the Ukraine, Russia, and others."

Yuan Peng said, "Putting the four changes together, we can draw the conclusion that a major, even a radical change in Sino-U.S. relations, unlike any in the past 35 years, is now emerging. China must make a fundamental strategic adjustment."


Source: Xinhua, November 28, 2014 
http://news.xinhuanet.com/world/2014-11/28/c_127259937.htm