Posts tagged ‘China’


China’s New Nobel Laureate: New Attention to an Old Science Problem – China Real Time Report – WSJ

Chinese pharmacologist Tu Youyou, who won a share of the Nobel Prize for medicine on Monday for her discovery of a game-changing malaria treatment, did her seminal work when China was in the midst of the radical movement known as the Cultural Revolution. Her pathbreaking Nobel win is renewing discussion of the way China’s scientific community does research.

The award to Ms. Tu ticks a number of firsts: She’s the first citizen of the People’s Republic to win a science Nobel, the first Chinese citizen to win a Nobel for medicine and the first female Chinese citizen to win a Nobel of any kind.

In marveling at that feat, Chinese media have dwelled on Ms. Tu’s lack of academic credentials. The 84-year-old chief professor at the China Academy of Traditional Chinese Medicine is without a PhD, without an overseas education and without the title of yuanshi (or academician) given to the country’s top scholars. For that reason, she has been referred to as China’s “three withouts” scientist. Prior to her winning the prestigious Lasker Prize for Medical Research in 2011, she was an obscure figure.

That a future Nobel laureate could be ignored for her lack of traditional accomplishments has renewed attention to an academic system already criticized by many as bureaucratic and unimaginative.

“It seems like every headline I’ve seen today says ”Three-Withouts’ Scientist Tu Youyou Wins Nobel for Medicine.’ That’s not a headline, but a question we should all ponder,” cinematographer Wang Peishan wrote in one of many similar comments on the Twitter-like Weibo social media platform.

Source: China’s New Nobel Laureate: New Attention to an Old Science Problem – China Real Time Report – WSJ


China’s Xi says to commit 8,000 troops for U.N. peacekeeping force | Reuters

China will contribute 8,000 troops for a United Nations peacekeeping standby force, China’s President Xi Jinping told the United Nations General Assembly on Monday, a move that could make it one of the largest players in U.N. peacekeeping efforts.

Xi’s pledge comes as China is trying to show it is a responsible international player amid concern over its growing military might and territorial disputes in the Asia-Pacific region. During a state visit to Washington on Friday, Xi agreed with U.S. President Barack Obama that both countries would increase their “robust” peacekeeping commitments. They are among leaders from more than 50 countries who pledged some 40,000 troops and police, as well as equipment or training for U.N. peacekeeping missions during a U.N. summit chaired on Monday by Obama.

“China will join the new U.N. peacekeeping capability readiness system, and has thus decided to lead in setting up a permanent peacekeeping police squad and build a peacekeeping standby force of 8,000 troops,” Xi said. He also said China would provide $100 million in military assistance to the African Union in the next five years to support the establishment of an African standby force and to boost its capacity for crisis response.

At the later summit, Xi said part of a new 10-year, $1 billion China-U.N. peace and development fund set up by China would be used for peacekeeping operations. China would give “favorable consideration” to future U.N. requests for more Chinese engineering, transport and medical staff, but operations’ “exit strategies need to be timely formulated and executed”, Xi said.

Obama, who held tense summit talks with Xi last week in Washington, shook his hand vigorously as he left the podium on Monday.


The U.S. military told dozens of U.N. ambassadors and military advisers in New York in July that the U.N. needed rapid response forces, equipment and training. Washington pays more than 28 percent of the $8.2 billion U.N. peacekeeping budget, but Beijing says it contributes more personnel to peacekeeping missions than each of the other four permanent members of the U.N. Security Council: the United States, Russia, France and the United Kingdom.

The top five troop- and police-contributing countries are Bangladesh, Ethiopia, India, Pakistan and Rwanda, according to August data from the U.N. website. China now provides around 3,000 of the more than 106,500 U.N. troops, police and advisers deployed by all countries, making it the ninth biggest contributor of peacekeeping personnel. Its largest contingent is in South Sudan, where it has played a growing diplomatic role and is a major investor in the oil industry.

Experts have noted that China’s expanding peacekeeping role in recent years parallels its desire to expand its military’s capabilities farther abroad and could provide logistical and operational experience. “They clearly want to create a more international armed force so they can operate in more challenging environments,” said Douglas Paal, director of the Asia program at the Carnegie Endowment for International Peace.

During his earlier address to the General Assembly, Xi tried to allay concerns that his country’s growing influence was a threat. “We are committed to peaceful development. No matter how the international landscape may evolve and how strong China may become, China will never pursue hegemony, expansion, or sphere of influence,” he said.

Source: China’s Xi says to commit 8,000 troops for U.N. peacekeeping force | Reuters

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Cisco joins flurry of U.S.-China tech partnerships | Reuters

Cisco Systems Inc (CSCO.O) said Thursday it would form a joint-venture with Chinese server maker Inspur to sell networking and cloud computing products in China, where the Silicon Valley firm faces political pressure and declining sales.

Chuck Robbins, incoming CEO of Cisco, listens a question from media during a news conference in New Delhi, India, June 18, 2015. REUTERS/Adnan Abidi

Cisco and Inspur said they would invest $100 million in the project, although they offered few other details.

The partnership is one of a growing number of tie-ups between Chinese and U.S. technology firms announced during or ahead of Chinese President Xi Jinping’s visit to the United States this week.

Microsoft Corp (MSFT.O) said on Thursday it would partner with Baidu Inc (BIDU.O) and Chinese state-owned private investment firm Tsinghua Unigroup on cloud technology, while Dell Inc announced last week it would invest $125 billion over five years in China.

Earlier this year, IBM (IBM.N) pledged to help develop China’s advanced chip industry with a “Made with China” strategy, while chipmakers Intel Corp (INTC.O) and Qualcomm Inc (QCOM.O) are developing chips with smaller Chinese companies.

Similar to its dealings with the foreign auto industry in decades past, Chinese officials have made clear to foreign technology firms that market access depends on their sharing technology and cooperating with Chinese industry.

Like many of its peers, Cisco’s market share has retreated in recent quarters in China, where its products have been labeled a cybersecurity threat by state media and government-affiliated experts.

U.S. business lobbies have said the Chinese allegations amount to protectionism, while China has pointed to the experience of Cisco’s Shenzhen-based rival Huawei Technologies Co Ltd [HWT.UL], which faced similar accusations from Capitol Hill when it sought to enter the United States.

Source: Cisco joins flurry of U.S.-China tech partnerships | Reuters


Boeing to sell 300 jets to China firms, set up China plant: Xinhua | Reuters

Boeing Co has signed deals to sell 300 aircraft to three Chinese firms and set up an aircraft plant in China, becoming the first U.S. firm to clinch a business tie-up in the country since Chinese president Xi Jinping began a U.S. state visit, the official Xinhua news agency said.


The aircraft deals, potentially worth tens of billions of dollars in total, are collectively the largest order the aerospace firm has received from Chinese companies.

China’s ICBC Financial Leasing Co, a unit of the Industrial and Commercial Bank of China, on Wednesday separately confirmed it will buy 30 of Boeing’s 737-800 jets, worth $2.88 billion at list prices.

China Aviation Supplies Holding Company and China Development Bank Leasing are the other two customers for the aircraft, said Xinhua.

Boeing, which is locked in a fierce battle for plane orders with European rival Airbus, will build its first aircraft completion plant outside the United States in China in order to gain a foothold in that important market, say industry observers. Boeing raised its forecast for China’s aircraft demand by 5 percent in August, saying that the country will need 6,330 planes over the next 20 years.

It signed a cooperation document with Commercial Aircraft Corporation of China (Comac) to build the aircraft completion center for its 737 passenger jet in China, added Xinhua. The agency didn’t disclose further details.

An aircraft’s interiors and some systems are usually installed, and the plane is painted in the customer’s livery, at completion centers. The final flight trials are then completed before the aircraft is delivered to the customer.

Boeing executives and officials from the Chinese firms could not immediately be reached for comment. Xi, who arrived in Seattle on Tuesday, is set to visit Boeing on Wednesday.

The number of air passengers traveling to, from and within China is set to nearly triple by 2034 to some 1.3 billion, surpassing an expected 1.2 billion for the United States, according to official estimates.

State-owned airlines like Air China, China Eastern Airlines and China Southern Airlines, and privately-owned budget carrier Spring Airlines, are growing fast and adding new planes to meet this demand for both short and long haul air travel.

Boeing’s plans for an aircraft completion center comes after Airbus signed an agreement in July to set up its second Chinese plant.

Source: Boeing to sell 300 jets to China firms, set up China plant: Xinhua | Reuters


Command and lack of control | The Economist

IF THE People’s Liberation Army (PLA) were a company, it would be about to lose its position as the world’s largest corporate employer. When troop cuts recently announced by Xi Jinping, China’s president, are completed in 2017, the ranks of China’s armed forces will have shrunk by 300,000 to 2m, putting it just behind Walmart, a retailer (see chart). It would still be by far the world’s largest military outfit.

When the downsizing was announced, at a big military parade on September 3rd, the cuts seemed no more significant than a round of corporate redundancies. Mr Xi’s own explanation—that they would help the PLA to “carry out the noble mission of upholding world peace”—also seemed to come straight from the gobbledygook of corporate obfuscation.

But recent commentary in China’s state media suggests that the reductions may presage something more: a long-overdue reform of the command structure of the PLA and a shift in the balance of the main military services. If so, one of the most important subsidiaries of the Chinese state is in for a shake-up.

The army has long been the senior service. Almost three quarters of active-duty personnel are soldiers. The navy and air-force chiefs did not have seats on the main institution for exercising civilian control over the armed forces, the Central Military Commission, until 2004. It was only in 2012 that an officer outside the ranks of the army became its most senior military figure. The army’s dominance is a problem at a time when China is expanding its influence in the South China Sea and naval strategy is looming larger.

Moreover, there has long been a split within the PLA between combat forces (which kill the enemy) and other operations (logistics, transport and so on) which are regarded as secondary. But in modern, high-tech warfare, non front-line services such as those responsible for cyberwarfare and electronic surveillance often matter more than tanks and infantry.

Embodying these outdated traditions is a top-heavy, ill-co-ordinated structure with four headquarters and seven regional commands. Many Chinese analysts argue that, as now constituted, the PLA would not be able to conduct modern information-intensive military operations which integrate all the services properly.

China has long talked about military reform. In late 2013 Mr Xi told fellow leaders that the command system for joint operations was “not strong enough”. It was duly announced that China would “optimise the size and structure” of the armed forces. China Daily, an English-language newspaper, said that a “joint operational command system” would be introduced “in due course”.

It now appears that these changes are under way. Mr Xi was recently quoted in PLA Daily, a newspaper, saying that “we have a rare window … to deepen [military] reform”. It is possible that Mr Xi’s anti-corruption purge, which has taken aim at two men (one now dead) who were once the country’s most powerful military figures, as well as 50 other generals, may have weakened opposition enough for change to begin.

The South China Morning Post, a newspaper in Hong Kong, recently published what it described as a radical plan devised by military reformers. This would scrap three of the four headquarters, reduce the number of regional military commands to four and give a more prominent role to the navy. It remains to be seen whether Mr Xi will go that far. But there is no doubt that, in order to fulfil what he calls China’s “dream of a strong armed forces”, he wants a leaner, more efficient PLA. To China’s neighbours, that would make it even more frightening.

Source: Command and lack of control | The Economist


How Modi’s Win Helped Boost India’s Ranks of Millionaires – India Real Time – WSJ

The ranks of the millionaires grew at a faster rate in India than anywhere else around the globe in 2014 thanks to the election of Prime Minister Narendra Modi and falling oil prices, according to a report on worldwide wealth.

After only marginal growth in 2013, India’s tally of high-net-worth individuals increased by 26.3% in 2014 compared with the previous year and with 17.5% in China and 8.2% in the U.S. over the same period, the data from consultants Capgemini and RBC Wealth Management, said.

High-net-worth individuals are defined as those with investible assets of more than $1 million.

The report says that the election of “a popular reform-minded prime minister” in May 2014 “had a positive effect on the economy and equity markets, boosting [high-net-worth-individual] gains.” More In Narendra-Modi

Mr. Modi’s win “helped to boost investor confidence and contributed to strong performance in the stock market,” the report’s authors said.

“Lower oil prices helped reduce the country’s budget deficit and retail inflation fell considerably,” they added. Still, in absolute numbers of very wealthy, India continues to lag behind. It had 1,975,000 people with $1 million to invest in 2014, compared with 4,682,000 in the U.S. and Canada and 8,901,000 in China.

The Asia Pacific region as a whole though, including India and China, had a higher number of millionaires than North America in 2014.

Source: How Modi’s Win Helped Boost India’s Ranks of Millionaires – India Real Time – WSJ


Leaving Las Vegas: Chinese state railway companies to build US high-speed link from ‘Sin City’ to LA | South China Morning Post

Work on joint venture for 370km high-speed line linking Las Vegas to Los Angeles could start in 2016 and is part of mainland’s pursuit of overseas high-speed rail deals

A consortium of Chinese state rail companies has teamed up with an American company to build a high-speed rail line in the United States, with work possibly starting as early as September 2016.

It is the latest push by Beijing to export its high-speed rail technology and tap lucrative offshore markets.

China Railway International USA and the private rail venture, XpressWest, said in a joint statement on Thursday that they would form a joint venture to accelerate the launch of a high-speed rail linking the western cities of Las Vegas with Los Angeles.

The deal marks the latest attempt in China’s increasingly aggressive pursuit of overseas high-speed rail deals after the country built the world’s longest network in less than a decade.

Beijing recently clinched contracts in Russia, although it has faced hurdles in Mexico and Indonesia because of bureaucratic reversals of decisions in those countries.

XpressWest, a private venture of a Las Vegas-based hotel and casino developer, was given approval in 2011 to build and run the 370km high-speed line, according to its website.

The project has US$100 million in initial capital, the companies said in the statement, released at a government-organised forum before President Xi Jinping’s forthcoming visit to the US. China Railway International USA is owned by a consortium made up of subsidiaries from the mainland state companies China Railway Group, CRRC Corp, China State Construction Engineering Corp and China Railway Signal & Communication Corp.

Gary Wong, an analyst at Guotai Junan Securities, estimated that the XpressWest project was worth US$5 billion, which he said would likely offer the many Chinese companies involved little financial benefit.

However, it was significant as a deal because it would help open the undeveloped US high-speed rail market, Wong added.

“If this opens up the United States market for them, opportunities for future expansion will increase,” Wong said. “And if [their technology] is used in the United States, it will be easier for them to sell to other countries.”



China’s top graft-buster breaks taboo by discussing Communist Party’s ‘legitimacy’ | South China Morning Post

Open discussion by top graft-buster Wang Qishan about the legitimacy of the ruling Communist Party – a topic long deemed unquestionable – has raised the eyebrows of some commentators. Graft-buster Wang Qishan has raised some eyebrows with his comments on the Communist Party's 'legitimacy'. Photo: AFP

“The legitimacy of the Communist Party of China derives from history, and depends on whether it is supported by the will of the people; it is the people’s choice,” Wang said when meeting some 60 overseas attendants of the Party and World Dialogue 2015 in Beijing on Wednesday. ADVERTISING Analysts said the aberration was a step forward but some disagreed with Wang’s interpretation of “legitimacy”.

Zhang Lifan, a Beijing-based commentator, said Wang’s remarks reflected a shift of attitude in the party as a result of intensified social conflicts and increasing pressure from an underperforming economy.

“In the past, the issue was not allowed to be discussed, because the [party] thinks [its rule] is justified unquestionably. As the old saying goes, ‘political power grows out of the barrel of a gun’. They fought their way into the ruling position, instead of being elected into it,” Zhang said. [The Communist Party’s] legitimacy was maintained by relying on economic growth, but now economic growth is facing problemsZHANG LIFAN, COMMENTATOR

“Its legitimacy was maintained by relying on economic growth, but now economic growth is facing problems. In the past people thought [the party] could continue governing and did not have strong opposition to it because they still had money in their pocket. Now the size of their pockets have shrunk,” he said.

Zhang Ming , a political scientist with Renmin University, applauded Wang’s courage, but disagreed with his use of “legitimacy”. “You can’t talk about legitimacy merely from a historical perspective. How to let the people express their approval or disapproval [of the government]? The ballots are the most obvious way,” he said.

Steve Tsang, a senior fellow at the China Policy Institute of the University of Nottingham, said the “legitimacy” Wang mentioned did not mean democratic accountability.

“The will of the people, in China’s political reality, is collected and reorganised into something in line with what the party wants,” he said.

“Then [it] uses the powerful propaganda machinery to ensure the people embrace the newly reformulated views as their own.”

Source: China’s top graft-buster breaks taboo by discussing Communist Party’s ‘legitimacy’ | South China Morning Post


From ‘Made in China’ to ‘Innovate in China’ – International Finance Magazine

In the West, people often opine that Chinese are not innovators but just copiers who can make a product at a cheaper rate. If somebody mentions inventions, like gunpowder and printing press which were invented by the Chinese, the argument often ends up with ‘they have not really followed through with their innovations and have since then made little progress in this department’.

From ‘Made in China’ to ‘Innovate in China’But the Chinese are ready to transform themselves from the factory of the world to the generator of innovation. Companies like Alibaba Group and Xiaomi among others are making a mark in the world.

“I understand that the China market is characterised by some significant weaknesses when compared to a highly mature Silicon Valley, but the investment power and determination of the Chinese government, along with its appetite to transition away from ‘Made in China’ to ‘Innovated in China’ leaves no doubt in my mind that China will become a leader when it comes to building ecosystems for growth of startups and other innovative organisations,” says Lars Lin Villebaek, co-founder of, a platform for startups. He has 10 years of personal entrepreneurship experience in China.

Last year, China gave birth to a massive 1.9 million new businesses (across all sectors) and saw some record breaking IPOs in the global market.

And unlike the US, which has Silicon Valley and the area around Boston which are known for their startup ecosystems, China has several dozen ‘Silicon Valleys’. “Most of these are in the embryonic stage. Silicon Valley has a long history of success while the Chinese ones are new. The oldest — Zhongquancun in Beijing district — dates back to the ’80s,” says Zhang Chia Hou, China & India analyst and a board member of and author of

According to Wan Gang, China’s minister of science and technology, the district last year birthed 49 startups daily. As of March 2015, 129 high-tech zones had been approved by the State Council. These are designated areas in different cities where entrepreneurs are supported by different policies and benefits, such as fast Internet connections, government assistance in funding, and access to talented and educated human resources from nearby universities.

“Zhongquancun is also home to several universities like the prestigious Tsinghua University which churns out PhDs and computer scientists by the thousands. So there is no shortage of people who understand technology and the investment tap is flowing quite readily,” says Erik Roth, an entrepreneur, lecturer, serial innovator and lead for McKinsey & Company’s Global Innovation & Growth Practice.

Apart from Zhongquancun, Shanghai and Chengdu are also home to several startups.

According to Villebaek, there are several other factors which will help China achieve the ‘startup capital of the world’ status. There is ample access to funding even for high-risk projects. As long as projects replicate proven business models and products, the financing is usually done very quickly.

Additionally, successful companies like Alibaba, Tencent and Baidu have taken upon themselves to nurture the startup system in the country.

Says Alibaba Group spokeswoman: “Our founders started Alibaba Group to champion small businesses, in the belief that the Internet would level the playing field by enabling smallenterprises to leverage innovation and technology to grow and compete more effectively in the domestic and global economies. Alibaba supports innovative entrepreneurs who are able to create products and services that benefit the end user and society as a whole.”

Also, some Chinese are going for international exposure. “Most of the emerging class of entrepreneurs and venture capitalists, including Alibaba’s founder Jack Ma, studied at leading US universities, and worked for great corporations and investment firms. Most Chinese who can afford it (foreign education) decide to have an experience abroad,” says Christoph Tutsch, founder and CEO of ONPEX, a company which provides white-label cloud-based payment technology.

Tutsch adds that China is going in the right direction and people are educating themselves to achieve their goals. “They are trying to think out of the box for solutions that will help the local problems. Even now, they are many successful tech companies in China that no one has heard of because they are kept in the local market, which is good for self-improvement. In the next few years, we will start hearing of more Alibabas who venture West,” says Tutsch.

Where they need to improve

Historically, the Chinese do not have a culture of risk taking. “In a long time, I have not noticed any disruptive business model from China,” remarks Roth. The educational system in the country will have to focus on research and offer education in entrepreneurship to address the needs of entrepreneurs.

“The young in general are following the old path of secure jobs in government or established industry. But with 1.3 billion people, there are enough youngsters interested in innovation and entrepreneurship for them to be a real force,” says Zhang.

Source: From ‘Made in China’ to ‘Innovate in China’-International Finance Magazine


What if the China Panic Is All Wrong? – China Real Time Report – WSJ

China’s stock-market routs and economic deceleration are widely cited as the major trigger for the latest round of global market volatility. But what if the dominant narrative about China—that the world’s No. 2 economy is on the verge of falling off a cliff—is wrong?

It would mean the global market turmoil hitting equities, commodities and currencies is an overreaction. “We may have seen overshooting,” said Hung Tran, executive managing director of global capital markets at the Institute of International Finance, an industry group representing around 500 of the world’s largest banks, funds and other financial institutions. Even the head of the International Monetary Fund indicated as much earlier this week.

One of the chief problems is that it’s difficult to gauge China’s black-box economy. The country’s true growth is a guessing game given a number of statistical factors. That’s why growth forecasts show a range spanning several percentage points. Lombard Street Research, for example, estimates the economy will only expand by 3.7% this year, nearly half Beijing’s official growth forecast. Even if China’s economy is healthier than many now fear, uncertainty is oxygen for market volatility.

More clarity from Beijing about growth prospects and crisis-management plans would likely prove fruitful. That’s why the U.S. plans to press Chinese officials for greater details on their policy plans at a meeting of finance ministers and central bankers from the Group of 20 largest economies late this week. Here are some of the arguments that might moderate market fears:

• China’s stock market valuation is a bad indicator of Chinese growth. “Investors should not get carried away by the collapse of the Shanghai Composite Index,” warns Melanie Debono from Capital Economics in note to clients, “not least because its performance often bears little relation to that of the economy, primarily due to wild swings in its valuation.” The market run-up in advance of the selloff was out of step with reality, says Nick Lardy, a China expert at the Peterson Institute for International Economics. That’s why he says there’s likely more to come in the Chinese market correction. Even after the rout, “The market was still trading at 39 times earnings. Give me a break, it’s still too high.”

• The devaluation of the renminbi likely isn’t Beijing scrambling to save the economy through competitive devaluation. Beijing’s depreciation was likely more about addressing a key concern for the International Monetary Fund as it considers whether to include the Chinese yuan in its basket of currencies that comprise its lending reserves than it was about reviving economic growth by juicing exports. On Aug. 11, Beijing changed the way it values the yuan, allowing markets to play a greater role in the exchange rate. Market pressure has long been for depreciation, so allowing the currency to be more market-determined would, in the near-term, naturally see the yuan move lower. Against a basket of global currencies, the yuan has appreciated over the last year by nearly 15%, accounting for inflation. That’s despite Beijing intervening for months to prevent the yuan from losing value. “So the fact that the yuan came down 3% to 4% is not going to make much difference,” said Ted Truman, a former top international finance official at the U.S. Treasury and the Federal Reserve.

GDP growth may not be nearly as bad as suspected. Economists such as Clare Howarth at Oxford Economics say that beyond official industrial production figures, data on car and cell phones sales are jacking up the risk that China’s growth stalls. But “critics are really overlooking the fact that the growth model has changed in China,” Lardy says. “The service sector is now the driver of growth. So the fact that industrial growth has slowed down quite a bit does not mean, as it would have meant 10 years ago, that the economy is falling off a cliff.” Based on electricity consumption, “I just don’t see any signs that the Chinese economy is experiencing a hard landing,” says Torsten Sløk, Deutsche Bank’s chief international economist. Joe Hockey, treasurer for an economy that is intimately tied to China, Australia, says market reactions have been overblown. “We’re confident about our understanding of the Chinese economy and we see over time huge opportunities for growth,” Mr. Hockey told the Journal.

• Rather than regressing to policies of old, China’s government has actually been showing signs of moving ahead with market reforms.

Source: What if the China Panic Is All Wrong? – China Real Time Report – WSJ


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