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China’s Reaction to Trump’s Election Win

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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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MIIT: Five Categories of Apps Banned from Smart Phones

Xinhua recently reported that the Ministry of Industry and Information Technology (MIIT) announced on its official website that five categories of software are not allowed to be preinstalled on any smartphone sold in China or connected to China’s networks. The five categories are: (1) Apps that collect or modify users’ personal information without permission; (2) Apps that quietly make use of the communication capabilities of the device, causing unauthorized traffic; (3) Apps that block normal use of the smartphone functions or network functions; (4) Apps providing information banned by the government; (5) Apps causing other damage related to information security and network security. The new rules are set to take effect on November 1, 2013. In addition to rolling out new rules, it is widely expected that, between April and December, the MIIT will launch a campaign against “junk text messaging.” 
Source: Xinhua, April 20, 2013
http://news.xinhuanet.com/info/2013-04/20/c_132324341.htm
Briefings | | |   Information/Technology

CRN: Local Government Debt May Be over RMB 20 Trillion

China Review News (CRN) recently reported the news that both Moody’s and Fitch downgraded Chinese currency and bond ratings. The news caused widespread concern in the international market, particularly about the scale of the debts accrued by China’s local governments. According to China’s former Treasurery Minister, Xiang Huaicheng, at present, local government’s debts are estimated to be over RMB 20 trillion. However, government officials are downplaying the risk level of this debt. Some have suggested that the debt is mostly domestic – it will not directly impact the global market. Some have expressed the belief that “the government has not yet seen any extremely damaging situations.” However, the central government has been paying significant attention to local government debt. The State Council had a meeting on April 17, focusing on the risk control of the local debt issue. New administrative rules are being designed. The general approach for future risk management is to stop bank loans to local governments. Instead, local government bonds will be the primary borrowing channel, which will require a market orientation. 
Source: China Review News, April 19, 2013
http://www.zhgpl.com/doc/1025/0/8/1/102508157.html?coluid=151&kindid=0&docid=102508157&mdate=0419094137
Briefings | | |   Economy/Resources

Xinhua: Close to 60 Percent of Underground Water in 198 Regions Rated Poor

On April 20, 2013, the Ministry of Land and Resources issued the 2012 China Land and Resource Communique. It disclosed that close to 60 percent of China’s underground water was rated poor. Of the sites tested, 16.8 percent were found to have extremely poor water quality. The study was conducted by checking the underground water quality at 4,929 testing sites in 198 regions.

Source: Xinhua, April 20, 2013
http://news.xinhuanet.com/local/2013-04/20/c_115468685.htm

Briefings | | |   Economy/Resources

Xi Jinping: Learn from Historical Experiences and Lessons

Xinhua reported that, on April 19, 2013, the Political Bureau of the Central Committee held its fifth group study session on the topic of “combat corruption and build a clean government.” Xi Jinping hosted the meeting. According to Xinhua, Xi stressed that the party needs to “pay attention to historical experiences and learn from historical lessons,” while improving the leadership skills of Party members so that the Party can maintain a strong core leadership in the current socialist development with Chinese characteristics.

Source: Xinhua, April 21, 2013
http://news.xinhuanet.com/2013-04/20/c_115468016.htm

Briefings | | |   Government/Politics

The Information Office of the State Council Published the 2012 US Human Rights Record

Xinhua reported that the Information Office of the State Council released the "2012 US Human Rights Record." It was created in response to the “distorted claims” made in the 2012 Human Rights Report that the U.S. State Department published. "According to the ‘2012 Human Rights Record,’ the U.S., the so called ‘Human Rights Defender,’ pointed fingers at over 190 countries about their human rights issues while it kept silent about its own record. … The ‘2012 US Human Rights Record’ was meant to disclose human rights violations that took place in the U.S. in areas including life and personal safety, civil and political rights, economic and social rights, racial discrimination, woman and children’s rights, and the U.S. rights invasions of other countries." According to Xinhua, this is the 14th time that the State Council has published the "US Human Rights Record."

Source: Xinhua, April 21, 2013
http://news.xinhuanet.com/politics/2013-04/21/c_115472314.htm

Briefings | | |   US-China Relations

Huanqiu Editorial: Welcome Kerry; Hope He Is Different from Hillary

On April 13, 2013, Huanqiu (Global Times) published an editorial on new U.S. Secretary of the State John Kerry’s visit to China. Below are some highlights: 

“This secretary is familiar with diplomatic affairs and is moderate in style, which is different from the former secretary Hillary Clinton.” “To Chinese people, the cold face of Hillary Clinton is hard to forget. [However,] ‘Moderate Kerry’ is only one of the many symbols of the United States. Even though his ‘moderation’ is true, he will not be able to lead the U.S. to reduce its suspicion toward China.” 
"What Sino-U.S. diplomacy is has become a blurred and serious problem. In the past, we considered it to be diplomatic visits by the leaders of the two countries, Sino-U.S. trade, and military talks. Today even ordinary Chinese people can realize that matters such as the friction over the South China Sea, the Diaoyu Islands conflict and the Korean Peninsula chaos all contain ‘Sino-U.S. diplomacy.’ This makes a lot of Chinese people feel uncomfortable whenever the U.S. comes to mind." “Today, a considerable number of Chinese people believe the overall goal of the U.S. toward China is to overthrow the current political system and to ‘crush China’ in a way similar to what U.S. did to the Soviet Union. Therefore, China needs to be extremely vigilant while developing relations with the U.S.” 
“Mutual trust between China and the U.S. cannot reach the same level as the trust among the U.S. and its allies. If the two countries allow each other’s strategic suspicion to go unchecked, the maintenance of "normal relations" between China and the U.S. can only rely on ‘common commercial interests.’ Such a relationship is not as strong as some people believe. It is very clear by just looking at the relationship between China and Japan.” 
“It should be emphasized that the nature of suspicion in China and the United States is different. The U.S. worries that the rise of China is a challenge to its dominant position. Its preventive measures against China are offensive, such as the implementation of the ‘Asia-Pacific re-balancing strategy,’ deploying troops around China, and encouraging China’s neighboring countries to be aggressive in the island dispute with China. On the contrary, China’s precautions against the U.S. are an instinctive protection of the country’s current political and security interests. China’s approach is defensive.”  
Source: Huanqiu, Aril 13, 2013 
http://opinion.huanqiu.com/editorial/2013-04/3828126.html
Briefings | | |   US-China Relations

2013 Hurun Report: The Growth of the Super-Rich Slowing Down

According to the 2013 Hurun Report released on April 15, 2013, the number of super-rich Chinese, defined as individuals with a net worth of 100 million yuan, grew two percent to 64,500 individuals, the slowest growth in the past four years. Beijing is home to more millionaires than any other city in China, accounting for 475,000 millionaires (in US dollars), followed by Shanghai with 390,000.

Eighty percent of these people are business owners, 15 percent are real estate investors, and five percent are day traders in the stock market.

These estimates of the 2013 Hurun Report are based on the macro-statistics from the National Bureau of statistics of China and on micro-statistics, including ownership of luxury homes and automobiles, income tax returns, sales of other luxuy items and registered capital of businesses.

Source: Xinhua, April 18, 2013
http://news.xinhuanet.com/overseas/2013-04/18/c_124595059.htm

Briefings | | |   Economy/Resources

ShineWing: Local Government Debt is Out of Control

Zhang Ke, Vice President of the Chinese Institute of Certified Public Accounts and chairman of the Beijing based ShineWing (HK) CPA Limited said during an interview with Financial Times that due to concerns about risks, his firm has ceased its audit businesses relating to local governments’ issuance of bonds. “The situation is out of control.”

“We have audited the bonds that some local governments have issued. We found they were very high risk, so we withdrew.” Zhang continued, “Most local governments do not have the ability to pay back the principal or service the debt. Things could become very serious.”

Zhang also said, “The situation is out of control. There may be a crisis. However, because the due dates on these debts keep getting extended, they have become long-term debts. Therefore, the timing of the burst is uncertain.” He indicated that, from public squares to road improvements, many local governments have put money into investments and received mediocre returns. Now they can do nothing but borrow new money to pay old debts. Zhang said, “This approach will not survive much longer. … When that time comes, it will not be the government but CPA firms and banks that will bear the ultimate responsibility.”

The Beijing based ShineWing (HK) CPA Limited claims that it is the largest domestic CPA firm in China.

Source: Caijing.com, April 17, 2013
http://economy.caijing.com.cn/2013-04-17/112682959.html

Briefings | | |   Economy/Resources