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Xinhua Commentary Series: Spotlight on the U.S. Presidential Election

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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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People’s Daily: Thailand Resumed Railway Project Connecting China

People’s Daily recently reported that the military government that is currently in-charge in Thailand just approved the resumption of the project to build two high-speed railways connecting Southern China. The project had been halted earlier due to political uncertainties and the Thailand Constitutional Court ruled in March that the entire infrastructure building project was unconstitutional. The new government started reviewing the railway project in May after taking over day-to-day government operations. According to the budget plan, the project is worth around US$23.2 billion. The construction is planned to begin next year. The resumed project plan, however, adjusted the target operating speed from 200 kilometers per hour down to 160. The government is still looking for ideas to bring the cost down further. 
Source: People’s Daily, July 31, 2014
http://world.people.com.cn/n/2014/0731/c1002-25379272.html
Briefings | | |   Geo-Strategic Trend

Seventy Percent of Coal Mining Companies Are in the Red

The level of the inventory in China’s coal mining industry reached a record high in the first half of 2014 in spite of measures to reduce the price and to restructure production. Seventy percent of these companies are in the red.

Recently, the largest 14 coal mining companies agreed on four measures. They agreed that, for the second half of 2014, they would reduce the output of their production by 10 percent; they would reduce the June level of their inventory by 50 percent; they would regulate and standardize coal imports and they would establish a self-regulatory mechanism within the coal mining industry. 
According to the statistics that the China Coal Industry Association released on July 12, 2014, as of the end of June 2014, China’s coal inventory had reached 99 million metric tons. Nine provinces had experienced industry wide losses in coal mining. Twenty out of 36 of the largest coal mining companies are in the red. Nine of those are on the brink of bankruptcy. Seventy percent of the coal mining companies in China are in the red. 
Sources: 
Securities Daily reprinted by People’s Daily, July 29, 2014 http://energy.people.com.cn/n/2014/0729/c71661-25361362.html 
Economic Information Daily, July 28, 2014 
http://news.xinhuanet.com/fortune/2014-07/28/c_126803768.htm
Briefings | | |   Economy/Resources

State Media Link Jiang Zemin with Zhou Yongkang and Bo Xilai

The People’s Daily website published a series of pictures with texts under each of them titled, “Charts: The Mysterious Petroleum Billionaire behind Zhou Yongkang.” 


The charts show that Zhou, the former Minister of Petroleum, has tightly controlled the petroleum industry through extensive and close connections both in and outside of the government. Most of these connections have been prosecuted or placed under investigation.  

The final chart shows the personal profile and rise of Zhou identifying him as part of petrochemical fraction and as someone who “knows Jiang Zemin and Bo Xilai well.” On July 29, Xinhua announced that Zhou was placed under investigation for "serious disciplinary violations.” On September 22, 2013, Bo was found guilty of corruption, stripped of all his assets, and sentenced to life imprisonment. 

The charts are no longer available on the People’s Daily website, although the title remained. 

Source: People’s Daily reprinted by Tencent Financial, July 31, 2014
http://energy.people.com.cn/n/2014/0731/c71661-25379629-5.html (See title of the article listed) http://xw.qq.com/c/finance/20140731076721
Briefings | | |   Government/Politics

What Does the Showdown Between Xi Jinping and Zhou Yongkang Tell Us?

The day after Xinhua announced the downfall of Zhou Yongkang, it published a blog commentary entitled “What Does the Investigation of Zhou Yongkang Tell Us?” 

According to the blog commentary, first, the showdown indicates that the anti-corruption movement is pressing ahead with no return. Second, Xinhua‘s announcement did not call Zhou Yongkang “comrade” indicating a fundamental change in Zhou’s case. Third, it shows that the anti-corruption campaign has no ceiling and will go after anyone who is involved in corruption. Fourth, retirement does not shield corrupt officials from an investigation. Even after a corrupt official retires, he may still be brought to justice. Fifth, there is no scapegoat for corrupt officials. They will be held accountable for their own actions. The fall of other corrupt underlings in the past has paved the way to investigate higher-ranking officials. Sixth, there is no special procedure – even Zhou Yongkang has to be subject to the investigation of the Central Commission for Discipline Inspection of the Communist Party. 
Source: Xinhua Blog, July 30, 2014 http://big5.xinhuanet.com/gate/big5/khyyaaa.home.news.cn/blog/a/0101003E31C10D010E29FE8E.html
Briefings | | |   Government/Politics

More Party Inspection Teams Conduct Corruption Investigations

Within days after July 29, when the announcement was made that an investigation had been instigated against Zhou Yongkang, several inspection teams of the Central Committee of the Communist Party were on their way to conduct investigations in Hebei, Shanghai, Helongjiang, and at the Chinese state-owned automotive, the First Automobile Works Group located in Changchun, Jilin Province. 

For the next two months, the inspection teams will stay in Hebei, Shanghai, and Helongjiang, respectively. They will also spend one month at the First Automobile Works Group. Xinhua has published the inspection teams’ hotline phone numbers and mailing addresses to encourage whistle blowers to contact them and report incidents of corruption and abuse of power. 
Shanghai, one of the inspection teams’ destinations, has been a long time base of the Jiang Zemin faction with which Zhou was aligned. The timing of the dispatch of these inspection teams was within three days of Xinhua’s announcement that the Central Committee of the Communist Party of China had decided to investigate Zhou Yongkang for suspected "serious disciplinary violations." Zhou is a former member of the Politburo Standing Committee of the Central Committee of the Communist Party.
Soho.com has compiled a list of 422 Party officials taken down from July 2012 to July 2014, including Zhou Yongkang.
Sources: 
Xinhua, July 31, 2014 
http://news.xinhuanet.com/politics/2014-07/31/c_1111873238.htm
Soho.com 
http://news.sohu.com/s2014/2832/s395957637/?pvid=470ca54660a1099c
Briefings | | |   Government/Politics

Jin Canrong: A Weak U.S. President Is Not Good for Sino-U.S. Relations

While talking to a reporter from the Global Times about the U.S. political situation and its impact on Sino-U.S. relations, Jin Canrong, Associate Dean of the School of International Studies, Renmin University of China, analyzed the poor economic situation in the United States. In his analysis, Jin said that this situation is a very important reason for the escalation of the American political struggle, as it has led the voters of each party to become more extreme. In addition, psychologically, the Republicans do not accept a minority president. As for the national decline of the U.S, as reflected in the worries that appear in the media, it is mostly due to objective reasons. China’s rise places the U.S. influence in a position of relative decline. However, it is also undeniable that Obama is personally to blame for the situation. Some of his policies often sound good but are unenforceable. This places the U.S. on a sliding trajectory. For [the interest of] China, it is better that the United States has a relatively strong president. In such a condition, it is more likely for cooperation between the two countries to be carried out and for agreements to be executed. Otherwise negotiations might not make sense. Republicans may not really sue Obama, but it would embarrass Obama and make him more vulnerable and weaker. This is not a good thing in terms of Sino-U.S. relations. 

Source: Global Times, August 1, 2014 
 http://world.huanqiu.com/exclusive/2014-08/5092779.html
Briefings | | |   US-China Relations

In the Economic Downturn, Local Governments Increase Tax and Fines

According to Xinhua, the Ministry of Finance recently released statistics showing that China’s national revenue increased by 8.8 percent in the first 6 months of 2014, as compared to the same period in 2013. Of the national revenue increase, tax revenue grew by 8.5 percent and non-tax revenue by 11.1 percent. The national GDP increased by 7.4 percent. 

According to Zhou Tianyong, an official from the Chinese Communist Party Central Party School, the tax rate was 36 percent in 2013, but was increased to 44 percent in the first 6 months of 2014, an increase of 8 percentage points. This increase occurred in spite of slower GDP growth, slower consumption and investment growth, and a negative growth in exports. 
Zhou asked, “What does this tell us? Local governments are increasing taxes and fees right in the middle of the economic downturn. It is, in fact, a fiscal mechanism of local governments based on fines and tax increases.” 
 Source: Xinhua, July 30, 2014 
http://www.js.xinhuanet.com/2014-07/30/c_1111858664.htm
Briefings | | |   Economy/Resources

Zeng Qinghong’s Niece Said to Be Involved in Zhou’s Case

Zeng Qinghong is a retired member of the Politburo Standing Committee of the Communist Party of China, China’s highest leadership council. Between 2002 and 2007, he was a top-ranking member of the Secretariat of the Central Committee. From 2003 to 2008, he also served as the Vice-President of the People’s Republic of China. He is a close ally of then-general secretary Jiang Zemin. Since the fall of security tsar Zhou Yongkang, rumors about Zeng have been surfacing.

On Aug. 1, 2013, a wealthy Sichuan businessman Wu Bing (吴兵), who had close business ties with Zhou Yongkang’s son Zhou Bin, was put in official custody. Wu Bing owned Zhongxu Holding Co., Ltd. (中旭投资公司), which holds shares of stock in Fantasia Chengdu (花样年成都), a corporate subsidiary of Fantasia Holding Group Co., Ltd. (花样年控股), which was founded by Zeng Baobao, Zeng Qinghong’s niece. According to its website, "Founded in 1998, Fantasia was successfully listed on the main board of the Hong Kong Stock Exchange in November 2009 under the stock code ‘1777.’ Its assets amounted to over RMB30 billion (US$4.86 billion)." In the early years, Fantasia Chengdu also worked with Zhongxu to create a Sichuan based joint venture. Sources in mainland China told Apple Daily that the authorities took Zeng Baobao away months ago to assist in the investigation of Zhou.

Because of the close relationship between Zeng and Zhou’s family, as early as May this year, there was speculation that Zeng Qinghong will be the next tiger that Xi Jinping will take down. Zeng Qinghong’s latest public appearance was on May 14 of this year. He visited an art museum in Shanghai, accompanied by Shanghai’s head of the Chinese Communist Party’s Central Committee, Han Zheng.

Source: Apple Daily, July 31, 2014
http://hk.apple.nextmedia.com/news/first/20140731/18817574

Briefings | | |   Government/Politics