Chinascope – Page 797

Study Times: China’s Dream Includes a Stronger Army and an Outgoing Military Strategy

On January 27, 2014, Study Times, a journal of the Party School of the Central Committee of the Chinese Communist Party, published an article on how China’s dream includes a stronger army. Up until now, China’s basic military strategy has been self-defense, to defend China’s mainland. According to the article, as China rises, China’s military strategy should be more and more outgoing. “(We) should not only be effective in deterring and defeating any aggression against our native mainland; we should also be effective in deterring and stopping any country that is against our vital interests abroad and deterring and stopping any neighboring countries that play with fire and intensify conflicts.”

As for China’s vital interests, the article particularly mentioned the Nansha Islands (Spratly Islands), the Diaoyu Islands (Senkaku Islands), and outer space.

Source: Study Times, January 27, 2014
http://www.studytimes.com.cn/shtml/xxsb/20140127/3852.shtml

Briefings | | February 5, 2014 | Defense/Military

Xinhua: HSBC January Chinese PMI Hit Six-Month Low

Xinhua recently reported that the newly released HSBC January Chinese Manufacturing PMI (Purchasing Managers Index) number showed a six-month low, at 49.5. This is the first time since August 2013 that the number fell below 50. Qu Hongbin, HSBC Chief Economist of the China Region, commented that the Chinese manufacturing industry demonstrated a very weak start in 2014, mainly caused by the low volume of new export orders and the low level of domestic business activities. Companies surveyed suggested that some primary export markets are seeing a lower demand. Qu suggested that the decision makers should pay attention to the risks, which may require policy adjustments. PMI is an indicator of financial activity reflecting purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline.

Source: Xinhua, January 30, 2014

http://news.xinhuanet.com/fortune/2014-01/30/c_119192408.htm

Briefings | | February 4, 2014 | Economy/Resources

China Daily: ICBC to Take over the International Branch of Standard Bank

China Daily recently reported that the Industrial and Commercial Bank of China (ICBC), which is the largest commercial bank in China, will acquire 60 percent of the International Market Division of the Standard Bank of South Africa for US$765 million. The International Market Division is headquartered in London. If approved, ICBC’s control will make it the first large Chinese state-owned bank to have large-scale operations in London. The British authorities used to refuse Chinese banks wanting to establish branches in London. Standard Bank of South Africa is the largest commercial bank in Africa. In 2008, it sold 20 percent of its stock to ICBC. In recent years, the Standard Bank has been shifting its focus to high growth regions in Africa. The latest deal will also give ICBC a five-year right to acquire an additional 20 percent of the International Market Division from Standard Bank.

Source: China Daily, January 31, 2014

http://www.chinadaily.com.cn/hqgj/jryw/2014-01-31/content_11143594.html

Briefings | | February 4, 2014 | Geo-Strategic Trend

Xinhua: HK Government Announced Phase One Sanction against the Philippines

On January 29, Xinhua reported that the Hong Kong government announced a phase one sanction against the Philippines. The sanction is in response to the refusal from the Philippines to apologize for the Manila Hostage Incident which occurred on August 23, 2010. It caused the death of eight Hong Kong residents during the rescue mission. The latest sanction will remove the 14-day visa waiver for Philippine’ official passport holders. The Chinese Ministry of Foreign Affairs immediately announced its official support of the Hong Kong government’s position. The Philippines Ministry of Foreign Affairs responded on January 30 that the Philippine’ government regretted seeing the outcome of the Incident, but did not intend to issue an official apology.

Source:

Xinhua, January 29, 2014

http://news.xinhuanet.com/gangao/2014-01/29/c_126080168.htm

China Radio International (CRI), January 31, 2014

http://gb.cri.cn/42071/2014/01/31/6071s4410562.htm

Briefings | | February 4, 2014 | Geo-Strategic Trend

State Council to Introduce Merger and Acquisition Plans for State Owned Enterprises

China National Radio reported that, according to an inside source from the Ministry of Industry and Information Technology, the State Council will soon introduce the “State Council’s opinion on further optimizing the market environment for the merger and acquisition of State Owned Enterprises.” The opinion will provide merger and acquisition guidance mainly to the steel, cement, vessel, photovoltaic, and baby formula industries. The article said that the current structure of these industries is in small scattered locations. There is no centralized planning; they often are deficient; and they have a serious excess production capacity. In these industries, these issues have been a major obstacle to reform. However, mergers and acquisitions in these industries also face serious difficulties, including heavy merger and acquisition taxes, financing, and a lengthy approval process. The opinion requires that the state should simplify the approval process while instituting policies that will provide optimized solutions on these issues.

Source: China National Radio, February 2, 2014
http://china.cnr.cn/ygxw/201402/t20140201_514778867.shtml

Briefings | | February 3, 2014 | Government/Politics

More Securitization of State-Owned Enterprises to Come

China Securities reported that local governments may securitize state-owned enterprises in amounts up to 20.7 trillion yuan in their efforts to raise funds for local expenditures. In the past, local governments resorted to borrowing and the sale of government land in order to raise funds. The central government has recently made the local government’s debts a focus of attention.

According to a statement that China’s Ministry of Finance made last week, in 2013, the proceeds from government land sales reached 4.1 trillion yuan, a 44 percent increase over 2012. Statistics released by the National Audit Office last month showed that, in 11 provinces, 316 cities, and 1,396 counties, the debts guaranteed by the sale of government land accounted for 37 percent of outstanding local government debts.

The stated goal of some local governments is to securitize 40 percent of the enterprises that they own by the end of 2015. More provinces, particularly those with a large number of state-owned enterprises, are expected to push beyond 40 percent. Based on a 40 percent securitization rate and a 10 percent asset increase of state-owned enterprises, it is estimated that such securitization of state-owned enterprises will reach 20.7 trillion yuan by the end of 2015.

Source: China Securities reprinted by Xinhua, January 30, 2014

http://news.xinhuanet.com/fortune/2014-01/30/c_126081679.htm

Briefings | | January 31, 2014 | Economy/Resources

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

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.”