Chinascope – Page 767

Cheng Ming Monthly: Wang Qishan Targeting Zeng Qinghong’s “Independent Kingdom”

The Central Commission for Discipline Inspection (CCDI) of the Chinese Communist Party (CCP) has targeted the five largest Chinese enterprises in Hong Kong for corruption. The five enterprise groups are: China Resources (华润集团), the Bank of China (中银集团), China International Trust and Investment Corporation (CITIC, 中信集团), the China Everbright Group (光大集团), and the China Merchants Group (招商局集团). At a CCDI meeting, Wang Qishan, the Commission’s Secretary, stated that their problems have long existed and are very severe. They have created independent kingdoms and their own cliques.

According to the May Edition (439th Edition) of Cheng Ming Monthly, a Hong Kong-based Magazine, of the top executives of these five largest Chinese enterprises and 35 enterprises owned by Provinces or Ministries in China, 75 to 80 percent are the children, grandchildren, or relatives, of government officials. 63 to 75 percent hold a foreign passport or residence card.

On April 11, 2014, the CCDI held a meeting of the “Anti-Corruption and Rectification Campaign” to target those five largest Chinese enterprises in Hong Kong. Wang Qishan stated at the meeting, “The combined work of auditing, checking, rectifying, and anti-corruption for the five enterprise groups have a clear, well-defined, and firm purpose. This work is to maintain responsibility to our people, our country, and our undertaking. For this work, we should never stop in the middle, retreat, or leave something unresolved for the future.”

Wang further listed the major problems that these enterprise groups face:
1. They have been establishing independent kingdoms and cliques in the areas of appointing executives, operations, and auditing.
2. There are powers at certain Central CCP department and local governments protecting these groups, which means that the central government’s over-twenty attempts to rectify and investigate these companies was done in vain.
3. They have changed or abandoned the CCP Central Committee’s regulations on institutions stationed outside China.
4. They have ignored the central government’s fiscal system, financial system, and accounting system, and created multiple versions of accounting books to cheat the government.
5. Top executives of these enterprises, along with their relatives, have conducted individual illegal economic and financial activities in the name of the enterprise.
6. They spend lavishly on salaries, benefits, and bonuses.

[Editor’s Note: Zeng Qinghong (曾庆红), the number two person in Jiang Zemin’s clique, has a strong influence over Hong Kong and Macao affairs. From 2003 to 2007, he was the Chair of the Central Hong Kong and Macao Work Coordination Committee and has continued to maintain a powerful influence. China Resources Chairman Song Lin, who was recently taken down on corruption charges, is considered Zeng’s man. Some media have mentioned that Wang’s targeting of these enterprises is a step aimed at Zeng.

Source: Wenxuncity.com, May 3, 2014
http://www.wenxuecity.com/news/2014/05/03/3236647.html

Briefings | | May 7, 2014 | Grapevine

China’s National Security Commission in Charge of both Domestic and Foreign Security Issues

According to China’s National Security Research Report (2014) released on May 6, 2014, China’s new National Security Commission is the highest decision making body on national security. It is also a chamber and a coordinating agency in charge of both domestic and foreign security issues. It takes responsibility for all of the following:

1) The development and implementation of China’s national security strategy: As the scope of national security is no longer confined to military issues, the national security strategy will be developed in macro and overall perspectives

2) The development of New National Security Law: China’s existing national security law includes counter-espionage laws, but that is too narrow. China’s new national security legislation should encompass military, political, diplomatic, economic, cultural, science and technology, information, ecology, intelligence, and other areas.

3) The development of National Security Policies: It should develop policies on how to deal with major domestic and foreign security crises and emergencies, how to solve social conflicts, how to combat the “three forces” (terrorists, ethnic separatists, and religious extremists) and more.

4) The study and resolution of Major National Security Problems: The National Security Commission is an inter-departmental coordination mechanism at the highest decision-making power. It involves public security, national security, military armies, police; diplomatic, transportation, economic, and intelligence departments, as well as the Foreign Affairs Office, the State Council Information Office and Hong Kong, Macao, Taiwan’s related offices.

Source: China News, May 6, 2014
http://www.chinanews.com/gn/2014/05-06/6137496.shtml

Briefings | | May 7, 2014 | Government/Politics

CASS: China Exaggerated 2012-2013 Export Numbers

The well-known Chinese news website Sina Finance recently reported that the CASS (Chinese Academy of Social Sciences) Institute of World Economy and Politics released a research report in which it examined China’s export statistics. The CASS research revealed that the actual export growth in 2012-2013 was 4 percent instead of the “official” 7.9 percent. The research found that China’s actual export scale was often miscalculated because of the impact of two main factors: (1) The Export-then-Import factor: After cargo was "exported," it immediately got “imported,” so that there was no real export; (2) The Fake Export factor: The exporter incorrectly reported a higher number. The Export-then-Import approach was often used to “cook” export statistics to those preferred by government officials; the 2012-2013 numbers reached US$157.3 billion. The purpose of the Fake Export approach was typically to collect more export tax rebates or to claim higher foreign investments. The number for 2012-2013 was estimated to fall between US$163.9 billion and US$244.6 billion. In the year 2013, China’s total cargo imports and exports surpassed the United States enabling it to become the number one cargo trader in the world.

Source: Sina Finance, April 28, 2014

http://finance.sina.com.cn/china/20140428/170918949225.shtml

Briefings | | May 6, 2014 | Government/Politics

BBC Chinese: Iran Cancelled US$2.5 Billion Contract with China

BBC Chinese recently reported that the Iranian government just announced a decision to discontinue a US$2.5 billion oilfield development contract with PetroChina. The contract required PetroChina to deliver 185 oil wells in the South Azadegan oil field, which is located near the Iran-Iraqi border. However, according to the Iranian government’s official website, PetroChina only delivered seven. The Chinese vendor won the contract when the Western countries jointly sanctioned Iran. Iran claimed that a warning notification was sent to PetroChina 90 days before the contract termination. However, the Chinese company did not take any action. The Iranian government had another contract with PetroChina for developing the North Azadegan oil field. There has been no report on that contract. The Azadegan oil field is one of the largest oil fields in the world, with a crude oil reserve of 420 billion barrels.

Source: BBC Chinese, April 30, 2014

http://www.bbc.co.uk/zhongwen/simp/world/2014/04/140430_iran_china_oil.shtml

Briefings | | May 6, 2014 | Economy/Resources

Xinhua: China Imposes Taxes on EU Polysilicon as Punishment

Xinhua recently reported that China’s Ministry of Commerce announced, at the end of April, that China reached a final decision on taxing solar grade polysilicon imported from the European Union for anti-dumping and anti-subsidy reasons. The decision took effect on May 1 and will remain in effect for two years. The announcement suggested that the EU’s unfair dumping and subsidy behavior seriously damaged China’s polysilicon industry. However the Ministry accepted the pricing adjustment promise that a German company made, as an exception. At the same time, electronic grade polysilicon based semiconductor products such as integrated circuits and discrete devices were excluded from the scope of the investigation and the resulting taxes. Based on the decision that the Ministry of Commerce made, the Customs Tariff Commission of the State Council issued an order to implement the new policy.

Source: Xinhua, April 30, 2014

http://news.xinhuanet.com/world/2014-04/30/c_1110494176.htm

Briefings | | May 6, 2014 | Geo-Strategic Trend

Xinhua: Singapore Has Become the Second Largest Offshore RMB Center

According to data released by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), on April 28, Singapore surpassed London and became the second largest offshore RMB center next to Hong Kong. The statistics showed that the March RMB settlement amount in Singapore accounted for 6.8 percent of the total. It thus surpassed London, which had 5.9 percent. However Hong Kong, which accounts for 72 percent of the world’s total, still remains the largest.

Source: Xinhua, April 29, 2014
http://news.xinhuanet.com/2014-04/29/c_126444131.htm

Briefings | | May 5, 2014 | Economy/Resources

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

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

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

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