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Global Times: Chinese Bank Loan Write-Downs Increased Significantly

Global Times recently reported that the five largest banks in China had a 127 percent increase in loan write-downs last year. This demonstrated a clear slow-down in growth with high pressure in the financial sector. These five banks own more than half of all of the loans in China. They wrote down a total of RMB 59 billion (around US$9.5 billion) worth of loans that would never be paid back. This level of write-downs is also the highest in ten years. In addition to the dramatic number of loan write-downs, in March, the Chinese financial market also suffered the first default in the corporate bond segment, two instances of near-default “shadow bank” investment products, as well as a run on the bank in Jiangsu Province. Data also showed that the first quarter economic slow-down turned out to be more severe than expected, which may indicate the slowest year of growth for the Chinese economy since 1990.
Source: Global Times, March 31, 2014
http://finance.huanqiu.com/view/2014-03/4942861.html

Xinhua: Peruvian Government Called Temporary Halt to CHINALCO Copper Project

On March 31, Xinhua reported that the government of Peru has recently shut down a China Aluminum Corporation (CHINALCO) copper mine development project temporarily, citing environmental violations. CHINALCO controls the Toromocho Copper Mine located in central Peru. The development is to construct one of the largest copper mines in the world, with the level of its capacity at 10-million tons. The Toromocho project is also China’s largest copper project overseas. The Peruvian environmental protection agency OEFA ordered the temporary shut-down due to the fact that the copper waste being discharged into the nearby lakes violated environmental protection codes. This was discovered around mid-March. The CHINALCO spokesperson refused to confirm the news because of the “lack of details.” China Aluminum Corporation is a multinational aluminum company headquartered in Beijing. It is the world’s second largest aluminum producer (and the only producer in China).
Source: Xinhua, March 31, 2014
http://news.xinhuanet.com/fortune/2014-03/31/c_126334845.htm

HSBC’s March Chinese Manufacturing PMI Reached Eight-Month Low

Well-known Chinese news site NetEase recently reported that the newly released HSBC March Chinese Manufacturing PMI (Purchasing Managers Index) number showed an eight-month low, at 48.0. The Manufacturing Output sub-index reached 47.2, which is the lowest it has been in 28 months. The sub-indexes for New Orders, Import Prices, and Export Prices fell to 46.5, 46.8 and 40.7, respectively. Qu Hongbin, the HSBC Chief Economist for the China Region, commented that the Chinese manufacturing PMI confirmed a very weak domestic demand level. He expected first quarter GDP growth to be slower than the annual goal, set at 7.5 percent. HSBC expressed the belief that the Chinese authorities will start economic policy adjustments sooner rather than later. PMI is an indicator of financial activity reflecting the purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline.
Source: Netease, April 1, 2014
http://money.163.com/14/0401/09/9OO4GBUF00253B0H.html

Xinhua: Experts Say China’s New Buildings Last Only 25 to 30 Years

On April 4, a 20-year old residential building in a city in Zhejiang Province suddenly collapsed. The incident draws attention to the many buildings that were built en masse

in the 1980’s in China. Now that these buildings are reaching the age of 20 to 30 years, there have been quite a few accidents:

On August 4, 2009, a two-story building in Shijiazhuang, Hebei, that had been built in the 1980s, collapsed in a rainstorm. On September 5, a five-story residential building in Ningbo, Zhejiang suddenly collapsed. Several other incidents took place in 2012 and 2013, resulting in deaths or injuries.

In 2010, a Ministry of Housing and Urban-Rural Development expert said at a conference, "Our country is the country with the largest number of new buildings constructed each year, but the buildings last only 25 to 30 years." In contrast, the average life expectancy of U.K. construction is 132 years and in the U.S. it is 74 years.

Source: Xinhua, reprinted on People’s Daily Online, April 7, 2014
http://society.people.com.cn/n/2014/0407/c1008-24838390.html

Foreign Ministry Tells U.S. to “Watch Your Step and Mind Your Words” on Hong Kong

Recently the spokesperson for the Office of the Commissioner of the Ministry of Foreign Affairs of the People’s Republic of China in the Hong Kong Special Administrative Region (SAR) answered a question from a journalist regarding U.S. Vice President Biden’s meeting with two heavyweight pan-democrats from Hong Kong and the New York Times’ Editorial "Protecting Hong Kong’s Autonomy."

"Since Hong Kong SAR’s reunification 17 years ago, the system of ‘one country two systems’ has been successfully implemented. The economic, social, and democratic developments in Hong Kong have exceeded expectations. The Hong Kong people enjoy unprecedented democratic rights and freedoms, which has won widespread international acclaim."

The spokesperson continued that Hong Kong affairs are China’s internal affairs. They firmly oppose any country intervening in any way and interfering with its internal affairs. The current political reform in Hong Kong is at a sensitive time. It is hoped that the United States will "watch your steps and mind your words" and not let the issue of Hong Kong interfere with Sino-US relations.

Source: China News, April 6, 2014
http://www.chinanews.com/ga/2014/04-06/6035011.shtml

Qiushi: The U.S. Is the Prime Culprit Endangering Internet Security

On April 4, Qiushi, the Chinese Communist Party’s flagship publication, accused the United States of being the "prime culprit" behind Internet insecurity. The following is an excerpt from Qiushi‘s article.

"Recently, another scandal broke out regarding the U.S. government’s surveillance programs. On March 22, 2014, the German weekly news magazine Der Spiegel and the New York Times disclosed, with documents provided by Edward Snowden, that the National Security Agency (NSA) conducted large-scale surveillance and espionage activities against China’s Huawei. The targets of U.S. intelligence agencies also have included China’s former national leaders, the Ministry of Foreign Affairs, the Ministry of Commerce, banks, and telecommunications companies."

"Frankly speaking, the news was not particularly shocking or unexpected. How could a country be lenient on a ‘highly concerned target’ if it would even tap into its own allies national leaders? Many analysts point out that the United States has been playing the game of a thief crying ‘stop thief.’ For a long time, the U.S. government has been accusing China of ‘organized’ hacking, stealing its government and business intelligence, and posing threats to its national security and economic interests. However, since the PRISM-gate scandal, a series of large-scale NSA domestic and foreign surveillance programs have been made public. Friends and foes have all suddenly become enlightened: the prime culprit behind the Internet insecurity is here."

"Alongside the surveillance scandal is the U.S.’s post-Cold War logic on national security. In short, the U.S. is seeking to achieve ‘absolute security’ both in the real world and in cyberspace. Starting from building the Theater Missile Defense system to today’s PRISM program, the U.S. has been pursuing security against any threat or challenge in an almost paranoid state of mind. Ever since the 9.11 incident, the U.S. has made gathering intelligence one of its top priorities. As the birthplace of Internet technology, the U.S. has a unique advantage in accessing information. Therefore, the U.S. intelligence agencies are heavily dependent on a variety of network tools to get the information that they want. As long as their so-called security is relevant, then privacy, legal restrictions, and moral principles are all left behind. … Its ideal version of network security is one in which the U.S. can monitor any object without any restriction, while any other country cannot do anything similar to the U.S. One strong piece of evidence is that, when the PRISM program was exposed, President Obama repeatedly defended the need for the program in terms of security, but never admitted that surveillance and monitoring are wrong."

Source: Qiushi, April 4, 2014
http://www.qstheory.cn/zz/wwtj/201404/t20140404_337203.htm

What Differences Exist between China’s International Partnerships?

The concept of "partnership" started after the Cold War. China has adopted the name "partnership" to define the bilateral relations. Since 1997 to 1998, China has established partnerships with Russia, the United States, France, and the E.U. Of the 172 countries with which China has diplomatic relations, China has established a formal partnership with 54 of them. Since China implemented a policy of non-alliance, there is no higher position in China’s diplomatic system than the "partnership" bilateral relationship. 

Based on the closeness and intensity of the relationship, China’s "partners" can generally be divided into: Partners, comprehensive partners, strategic (cooperation) partners and the comprehensive strategic (cooperation) partners. "Comprehensive" refers to the broader areas of cooperation, including political, economic, cultural, and military. "Strategic" means a higher level of cooperation and there are common grounds in the overall situation and the country’s core interests. Partnership can be between two countries. It can also be between China and an international organization. 
Partnership between China and the E.U. belongs to comprehensive strategic partnership. The China–U.S. "partnership" is limited to the economy, [only simple partners]. Compared to the United States, China uses a unique word to describe the China-Russia "partnership," which is "comprehensive strategic collaborative partnership." China does not use such a title for other countries. China and Japan have not had "partnership" relations until today. 

Source: People’s Daily, March 31, 2014 
http://world.people.com.cn/n/2014/0331/c1002-24778739.html

Qiushi: China’s Socialism and Its Global significance

Qiushi published an article on the rise of China and its significance for the world. The article stated that China has promised that it will never seek hegemony or compete with the West for the “center.” In the 20th century, the West failed to dominate the world with the Western model. The West cannot do it in the 21st century either. China has proven this point with its own development. "The success of China’s way is the success of socialism. …  The rise of China shows that world socialism has a strong vitality and there is hope for its revival. … Therefore, we are engaged in socialism rather than anything else. This should be very clear. We should be righteous and cannot avoid this point. … As long as a socialist China exists, there is hope that world socialism will revive.” 

Source: Qiushi, April 4, 2014 
http://www.qstheory.cn/gj/zgwj/201404/t20140402_336604.htm