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State-Owned Enterprises Warned of Upcoming “Winter Conditions”

Shao Ning, Vice Chairman of the State-owned Assets Supervision and Administration Commission (SASAC), recently attended a management conference at which he stated, “After 30 years of rapid development, the Chinese economy has entered a period of contraction. State-owned Enterprises (SOEs) must prepare for ‘winter conditions’ in the next three to five years.” The first time that the SASAC discussed “winter” was last December when Huang Shuhe, a Deputy Director at SASAC warned twice that SOEs must be prepared for tough winter times in the next three to five years. SASAC Director Wang Yong made similar remarks last March. Wang stated that in a grim economic situation, the SOEs "should identify risk points by improving management and alleviating the bleeding.”

A China Entrepreneurs commentator stated that SOEs are not the only ones that must prepare for a cold winter. “Private enterprises, especially mid to small companies, need to do a better job of preparing for winter. When a cold winter comes, these companies will be the hardest hit as their struggle is in the midst of the market.”

Sources:
Xinhua, June 26, 2012
http://news.xinhuanet.com/fortune/2012-06/26/c_112287187.htm
China Entrepreneurs, July 9, 2012
http://www.iceo.com.cn/column/28/2012/0709/252364.shtml

IHL: China Should Take a Tough Stance to Make up for Its Military Disadvantage

The International Herald Leader published an article advocating that China be aggressive to make up for its weak military position. The article stated that it is wrong for a weak party to avoid confrontation with a strong opponent. “Patience in the face of a powerful and strong-willed combative opponent is useless because the party that wants to avoid resolving the problem by force cannot prevent a war …” The appeasement policy may also encourage the opponent to take a tougher stance and resort to military action. If China were to wait for the time when it is stronger than the U. S. before taking action in the South China Sea, China would be tying its own hands and feet. “China should demonstrate sufficient resolve to confront the U.S. intimidation tactics, such as visits by U.S. warships to sensitive countries and bilateral and multilateral joint military exercises. It should not retreat when both parties are merely exchanging words in the conflict.” The article concluded with a quote from a military strategist, “If your sword is shorter, you should take a step forward.”

Source: International Herald Leader, July 12, 2012
http://ihl.cankaoxiaoxi.com/2012/0712/60019.shtml

China’s Outlook on the Shanghai Cooperation Organization

[Editor’s Note: The Shanghai Cooperation Organization (SCO) had its 12th Summit in Beijing from June 6 to 7, 2012. Chinese media praised the event highly as a milestone for SCO, marking the transition into its second decade. In China’s view, the SCO model, or “Shanghai Spirit,” is China’s way of dealing with international organizations. It differs from the U.S. model in that China focuses more on political results. It fosters political unity by offering economic help to other countries. China contributes more monetarily to SCO but offers each member country the same share of voting power. China also leverages its huge economic engine to promote joint regional economic development. The economic carrots that China has offered have served to keep the SCO united and have played a more and more important role in regional and international affairs. The following are excerpts from three articles that Outlook Weekly published to commemorate the SCO.]

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Forty Three National Enterprises Qualified Finalist of 2012 “Fortune” Global 500

On July 9, 2012. Fortune Magazine published its 2012 "Fortune Global 500" list of companies as ranked by revenue. Seventy-nine Chinese companies made the list, including 73 Chinese mainland and Hong Kong top companies (the other 6 being Taiwanese with the total representing an increase of 12 over the previous year). Of these, 43 were central enterprises (national companies), an increase of five over the previous year.

Of the 43 central enterprises, the China Merchants Bank, the Emerging Jihua Group, the Anshan Iron and Steel Group, China Power Investment, Huadian Group Ltd., and China Power Construction were new companies on the list.

The 2012 "Fortune Global 500" companies required a minimum full-year operating income of US$22.006 billion, an increase of US$2.52 billion over the minimum income for 2011.

Source: Xinhua, July 10, 2012
http://news.xinhuanet.com/2012-07/10/c_112403123.htm

People’s Daily: What is the True Intent of Clinton’s Asian Visit?

People’s Daily published several articles on U.S. Secretary of State Hillary Clinton’s Asian visit, that was due to take place from July 5 to 18, 2012, and cover 8 countries around China. “Looking at the itinerary, it appears that she will visit all of the countries that surround China. Such an itinerary is questionable. Is this a new trick for the United States to win over the small countries and to contain a large country?” On a follow-up commentary, People’s Daily stated that the United States should “exercise restraint over its impulse to preach democracy.” “The reality has demonstrated that it is precisely because some Asian countries copied the American democratic system that these countries now have serious problems, leading to slow development. Even today some of these countries have not yet recovered.”

Source: People’s Daily, July 12, 2012
http://world.people.com.cn/BIG5/n/2012/0712/c1002-18500638.html
http://world.people.com.cn/n/2012/0712/c1002-18498337.html

Sina.com Deleted Miniblog Account of the U.S. Consulate in Shanghai

Epoch Times reported that, in the morning on July 12, 2012, sina.com, a Chinese social media, removed the popular miniblog (weibo) account of the U.S. Consulate in Shangahi. A search by the Epoch Times staff of the weibo account at sina.com returned the following: “Search result cannot be displayed due to relevant law, regulations and policy.” Apparently the weibo account of the U.S. Consulate spokesperson was also deleted. Searches for “U.S. Consulate in Hong Kong,” “U.S. Embassy in China,” “Embassy in China,” and "Embassy” at sina weibo returned errors saying the search results could not be displayed.

Sources:
Epoch Times, July 12, 2012
http://www.epochtimes.com/gb/12/7/12/n3634182.htm
http://t.qq.com/USConsulateShanghai

People’s Daily: Washington Should Restrain Its Impulse to Preach about Democracy

China’s state-run media hit back at U.S. Secretary of State Hillary Clinton for the comments she made calling for greater democracy in Asia. The official People’s Daily ran an editorial, “Washington Should Restrain Its Impulse to Preach about Democracy.” The editorial stated:

“Who gave the Americans the position to comment on democracy in Asia in such an arrogant manner? Americans may not want to dwell on this issue and may even think that this is a question that should not be asked. It is precisely the illusion on this issue that may lead to the failure of the U.S. strategy of ‘returning to Asia.’”

“Some of the U.S.’s recent practices were apparently designed to prove the legitimacy of its dominant position in Asia. Engaging in military exercises and increasing its troops stationed in the region were to shape its role as security provider; holding the banner of ‘democracy’ and ‘human rights’ was to maintain its so-called moral leadership.”

“However, the more the U.S. cannot wait to do this, the more it can be seen that the U.S. is worried about losing something in Asia. There are two issues that caused Washington not to understand the reason why the U.S. feels it has alienated Asia and needs to ‘return’: on the one hand, in a relative sense, the U.S. has reduced its investment in this region; on the other hand, the region’s political and economic structure has undergone significant changes, so the position of the U.S. will be different.”

“If the U.S. moves against the general trend of cooperation in Asia, if it always shows up acting the role of preacher, if it always condescends to find fault with democracy in Asia and even wants to form a ‘team’ to contain the development of China, it will ultimately become marginalized.”

Source: People’s Daily, July 12, 2012
http://paper.people.com.cn/rmrb/html/2012-07/12/nw.D110000renmrb_20120712_1-03.htm

China Faces an Irreversible Population Crisis

On July 10, 2012, Wang Feng, the Director of the Brookings-Tsinghua Center, spoke at the 2012 Future China Global Forum that was held in Singapore. At the forum, Wang stated that China is trapped in a severe, irreversible demographic crisis.

According to Wang, the current ratio between the number of working-age people (age 20 to 59) and older people (60 and over) is 5:1. Wang predicted that the ratio will fall to 2:1 by 2030. More and more elderly families will have only one child. This will not only impact the labor market; it also will also have a political impact. It will require institutional innovation. Wang observed that, although investment in large projects and in infrastructure may bring short term results, the more important and urgent need is for improvements in public health-care and the social security system and for pressing ahead with institutional reform.

Source: Caixin, July 10, 2012
http://economy.caixin.com/2012-07-10/100409420.html