Chinascope – Page 821

2014 Application Process for Public Servants was Launched

On October 16, 2013, the application process for public servants was launched. The total number of open positions in 2014 is 19,538, which is 1,301 lower than 2013. As of October 17, 80,000 applications had been received and had passed the employers’ verification process. Among the departments with open positions, the Administration of Taxation and Custom had the most applicants. However the most competitive position was with the State Ethnic Affairs Commission where there are 2,033 applicants applying for just two openings. The ratio is 1,017:1.

Source: People’s Daily
October 16, 2013 http://edu.people.com.cn/n/2013/1016/c1053-23219517.html
October 18, 2013 http://edu.people.com.cn/n/2013/1018/c1053-23247273.html

Briefings | | October 21, 2013 | Government/Politics

China Youth Daily: U.S. Debt Crisis Alarms China

China Youth Daily published an article, which was later republished, listing a number of warnings about the effect the U.S. debt crisis has on China:

First, the U.S. debt ceiling dispute once again warns China not to put its debt investments in one basket or excessively concentrate on one financial product.

Second, China’s local government debt crisis is far more worrisome than the U.S. national debt crisis. An audit notice in June [2013] showed that 36 local governments had a total debt balance that neared 3.85 trillion yuan; 16 regions had a ratio of debt to GDP that exceeded 100 percent. The highest debt ratio was as high as 219 percent. The region with the highest debt ratio was concentrated in the Yangtze River Delta region (Shanghai municipality and Jiangsu and Zhejiang Provinces). Their overall debt ratio was over 200 percent, without even including the local government’s debt from its implicit guarantee.

Although the risk of a U.S. Treasury default is worrisome, it at least lets people know where the danger is. However, the debts of China’s local governments are a big mess. If the U.S. Treasury were a person forced to the edge of a cliff, at least he could see clearly that if he walked forward any further, he would fall down. Thus he could stop himself on time. Chinese local governments with debt are facing away from the cliff. They cannot see how far away the cliff is. This is much more frightening.

Third, the governments’ budgets must be open and transparent and they must accept being monitored by the National People’s Congress.

Source: China Youth Daily, October 16, 2013

http://news.youth.cn/gj/201310/t20131016_4031468.htm

Briefings | | October 18, 2013 | Government/Politics

China’s Local Government Debts May Reach 24 Trillion Yuan

Shanghai Securities News reported on October 17 that the national audits of local governments’ debts are coming to an end and that such debts are estimated to be as high as 24 trillion yuan, which amounts to 40 percent of GDP.

Since July 2013, Chinese authorities have quietly conducted an unprecedented national audit of local government debts. It is anticipated that the audit will be completed soon. While the consensus is that the local government debts will be over 10.7 trillion yuan, the China Chengxin (Asia Pacific) Credit Ratings Co., Ltd. estimated the number will be as high as 16 trillion. Others believe the number could be between 21.9 trillion to 24.4 trillion. That would amount for 38 to 42 percent of China’s GCP.

Source: Shanghai Securities News reprinted by Sina.com, October 17, 2013 http://finance.sina.com.cn/china/20131017/021817016037.shtml

Briefings | | October 18, 2013 | Economy/Resources

Liu Yazhou: The Internet Has Become the Main Battlefield of Ideological Struggle

Liu Yazhou, Political Commissar of the University of National Defense, published an article in the military newspaper PLA Daily calling for firm control of the battlefield of ideological struggle—the Internet. Liu started his article by quotating CCP General Secretary Xi Jinping’s statement that the Party’s ideological work is extremely important work that is related to the Party’s future and destiny.

Liu commented, “At present, the overall situation in the ideology [battlefield] is that the West is stronger than we are and the enemy is in offense and we are in defense. The opponents have always been setting the default topic, creating trouble, and keeping us busy in our struggle to defend. If this situation continues, it is inevitable that something may go wrong. Therefore, you must strive to take the controlling position using great wisdom, great vision, and great strategy. … [We] must have counter-measures to deal with the ideological attacks emanating from all of the hostile forces from outside.”

Liu stressed, “[We] must take control of the right to define public opinion (the opinion right). The essence of this ideological contest is the control of public opinion. Whoever owns the right to interpret and define those opinions will be able to guide the people. History shows that, for the country, the government, and the army, the ability to control the air, sea, and information is very important to winning the ‘hard battle.’ However, if one were to lose control of the opinion right, the country might already have split and the regime changed hands even before the ‘hard battle’ occurs. … Entering the new century, whoever controls the Internet, especially micro-blog resources, will have the greatest right to [control] opinions. Today’s Internet has become the main battlefield for ideological struggle. The Western hostile forces seek to advance this ‘biggest variable’ to "topple China.’”

Liu continued, “From a regime’s perspective, to win the ideological battle, the ruling party must … occupy the moral high ground. If this is achieved, no matter how the hostile forces engage in peaceful evolution, it will be in vain.”

Source: PLA Daily, October 15, 2013

http://chn.chinamil.com.cn/jwjj/2013-10/15/content_5591164.htm

Briefings | | October 17, 2013 | Government/Politics

China to Tackle Overcapacity

China’s State Council, the country’s cabinet, recently issued a document to tackle the overcapacity in a number of industries including cement, electrolytic aluminum, sheet glass, shipping, and steel.

The Guideline for Tackling Serious Production Overcapacity lists eight tasks in each sector: forbid expanding the capacity of new projects; clear up illegal capacity; eliminate outmoded capacity in an orderly way; promote mergers and the restructuring of enterprises; develop effective domestic demand; expand the international market and expand foreign investments and cooperation; make breakthroughs in technologies and strengthening enterprise innovation; facilitate innovation in government management and create a fair environment for improvement of the market mechanism.

Source: Xinhua, October 15, 2013
http://news.xinhuanet.com/2013-10/15/c_117726958.htm

Briefings | | October 17, 2013 | Economy/Resources

Wan Gang: The Shocking Abuse of R&D Funds

On October 14, China Daily reprinted an article first published in Beijing Youth Daily about the abuse of R&D funds. On October 11, China’s State Council of Information Office held a press conference at which Wan Gang, China’s Science and Technology Minister, stated that the “dreadful problems” with research and development funding were shocking.

The three year audit of the ministries under the State Council and the provinces revealed that out of several hundred audit reports that were done from 2007 to 2012, 39 involved “problem R&D funds.” The 39 audit reports showed that fraudulent practices could pass the approval processes, that programs could be developed without feasibility studies, that funds could be allocated even when there was no possibility of implementation, and that the completion of projects could be accepted without any inspection.

For example, the 13 institutions of higher education under the Shandong Province Education Department spent 943 million yuan (US$154.61 million) on R&D when they had no projects. From 2010 to 2012 the Transportation Ministry spent 186 million yuan (US$30.5 million) of 1,556 million (US$255.12 million) in R&D funds on salaries and subsidies to personnel, without complying with personnel regulations and pay standards.

In recent years, China’s R&D expenditures have grown about 20 percent annually. In 2012, they accounted for 1.9 percent of GDP, reaching 1.024 billion yuan (US$167.89 billion)

Source: Beijing Youth Daily reprinted by China Daily, October 14, 2013

http://www.chinadaily.com.cn/hqgj/jryw/2013-10-14/content_10314422.html

Briefings | | October 17, 2013 | Information/Technology

China’s System Is a Trap that Lures All Officials to Commit the Crime of Bribery

On October 10, 2013, Chinaweekly.cn published an article on the prevalence of the bribery phenomena among Chinese officials. When a university professor and a deputy Party secretary of the Changsha Municipal People’s Congress were attending a seminar in Germany, the university professor said to the Party secretary, “According to German standards, we are all criminals.” The deputy Party secretary eventually quit his job because he realized that, just based on China’s own policies which the Chinese Communist Party Central Commission for Discipline Inspection had established, many Chinese have committed the crime of bribery.

China’s political system causes all officials from the bottom to the top to be trapped into either giving or taking bribes. It is a hidden rule in China that bribery must be used to initiate projects and to obtain funds. The article concluded that, in order to prevent officials from committing crimes because of their jobs, China must first discipline the officials from the top so as to block any loopholes in the system.

Source: Chinaweekly.cn, October 10, 2013
http://www.chinaweekly.cn/bencandy.php?fid=63&id=6871

Briefings | | October 16, 2013 | Grapevine

China’s Shortcut for Obtaining Core Technology from Foreign Countries: Mergers and Acquisitions

The debt crisis in the U.S. and Europe has given China new opportunities to merge and acquire foreign enterprises. According to China Review News on October 13, 2013, China has become one of the five largest capital exporting countries in the world. In 2012, Chinese investors invested directly in 4425 overseas companies located in 141 countries and regions with accumulated non-financial direct investments of US$77.22 billion, an increase of 28.6 percent over the previous year. In this new situation, China’s future cross-border mergers and acquisitions show the following trends:

Since many countries view state-owned enterprises’ mergers and acquisitions as politically motivated commercial activities, more private enterprises are engaging in cross-border mergers and acquisitions.
China’s demand for energy resources is growing rapidly. Of 45 types of bulk minerals that China needs for its development, by 2020, China will achieve self-sufficiency with only 6 of these types. China’s thirst for resources will drive China’s enterprises to get involved in cross-border mergers and acquisitions in more and more diverse industries (finance, IT, and tertiary industries) on a global scale, with the focus on oil, gas, mining, and chemical industries.
In order to be effective in avoiding the high risks of the cross-border mergers and acquisitions, China has used and will continue to use the world’s leading professional intermediaries and foreign lawyers to provide consulting services throughout all of the acquisition processes.
To merge and acquire advanced technology enterprises in developed countries is a shortcut to using legal means to obtain core technology from foreign countries. Therefore, China’s cross-border mergers and acquisitions will be mainly technology-oriented.
To reduce acquisition costs, China will take full advantage of local capital in the foreign markets through the acquisition of listed companies for financing and will directly or indirectly attract investments in foreign capital markets.
China will send its management teams to the merged companies overseas and will conduct post-merger cultural integration for the purpose of taking corporate control while maximizing the value of the acquired companies.

Source: China Review News, October 13, 2013
http://www.zhgpl.com/doc/1027/9/3/7/102793724.html?coluid=53&kindid=0&docid=102793724&mdate=1013071942

Briefings | | October 16, 2013 | 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.”