Archive for ‘Economics’

06/12/2012

* China pledges $56 billion to cut air pollution

Reuters: “China will spend 350 billion yuan ($56 billion) by 2015 to curb air pollution in major cities, the environmental watchdog said on Wednesday.

Visitors to Tiananmen Square shield themselves from the sun with umbrellas on a hot and hazy day in Beijing July 28, 2010. REUTERS/David Gray

Local governments will fund most of the programs aimed at cutting the level of harmful particles in the air in 117 cities by at least 5 percent between 2011 and 2015, the Ministry of Environmental Protection said in a statement on its website.

Doctors warn that the tiny floating PM 2.5 particles, named for their less than 2.5 micrometer diameter, can settle in the lungs and cause respiratory problems and other illnesses.

China began publishing data on the amount of such pollution earlier this year in an effort to address concerns from residents that pollution readings were grossly understated.

Chinese officials have acknowledged that the thick cocktail of smokestack emissions, vehicle exhaust, dust and aerosols that often fills the air in many cities is a growing concern to increasingly prosperous urban residents.

Many Chinese in Beijing refer to an air pollution index published by the U.S. embassy, a move that has drawn the ire of Chinese officials who have called it unscientific.

Those measurements, based on U.S. standards, appear much grimmer than those of the city government’s and often list pollution levels as hazardous at prolonged exposure.

China has cited its ongoing reliance on heavy industry as the reason it failed to meet some of its 2011 air and water pollution reduction targets.”

via China pledges $56 billion to cut air pollution | Reuters.

See also: https://chindia-alert.org/economic-factors/greening-of-china/

06/12/2012

* How Cities Can Save China

We sincerely hope that the author is right and that the Chinese authorities both agree with him and decide to implement his suggestions – soon!

NY Times: “CHINA is experiencing its most severe economic downturn in decades, and revitalizing its economic model is critical to future prosperity — not only in China, but around the world.

Central to that effort is the transformation of China’s cities. By adopting a new approach to urbanization, its leaders can assure more balanced investment, address a major source of debt, achieve a consumption windfall and clean up the country’s environment. Otherwise, China’s economic and environmental problems will worsen, with vast implications for the rest of the world.

China’s success has been built on two pillars: investment and exports. But after decades of growth, this model is delivering diminishing returns. There is little doubt that China must change to a new model, one that relies on consumption to generate growth, while addressing debt and broadening the use of sustainable energy and environmental practices.

Cities, home to hundreds of millions of Chinese consumers, lie at the core of this problem — and offer a potential solution.

A flawed system of municipal finance is driving debt, corruption and dissent, while unsustainable urban planning has yielded polluted cities that are destroying China’s ecosystem. Yet China’s future requires continued urbanization, which, absent a new approach, will only make the problem worse.

Cities can, however, be part of the solution: better urban policies can put China on a healthier path forward, economically and environmentally.

For one thing, municipal financial reform is essential because debt is crushing Chinese cities, leaving mayors with no means of financing the central government’s policy mandates. Mayors have developed creative ways to raise revenues, including appropriating farmers’ land and seizing land on the outskirts of cities to sell to developers. But these practices contribute to urban sprawl and often feed corruption.

Among other changes, China’s cities need transparent budgets and the devolution of more tax authority to cities.

More innovative urban planning and design are also needed. To achieve the country’s goals of raising living standards for a broader share of the population, cities must be better designed to yield energy efficiency and environmental sustainability.

China’s potential is stifled by traffic and pollution. Gazing out my hotel window in Beijing on a recent trip, I saw air that was hazy and polluted — a stark contrast to the sparkling view of Lake Michigan I enjoy from my kitchen window at home in Chicago.

This isn’t just China’s problem. Experts found that dirty air from China contributed up to 20 percent of the ground-level pollution on the American West Coast in 2010. And that is when just one-tenth of Chinese own cars. Imagine what China’s air quality will become when this number triples, as some experts predict it will within the next several years.

Take another example: construction. Within city centers are countless “superblocks” — half-kilometer-square developments interspersed with huge boulevards that create monster traffic jams and skyrocketing pollution.

In response, an approach that featured smaller blocks and mixed-use neighborhoods and accessible public transportation would alleviate these unintended consequences. Such “livable cities” would balance economic development with energy efficiency, improve air quality and reduce congestion.

Getting China’s urbanization right will matter to us all. Fortunately, many in China understand this, and cooperation with the United States government, corporate world and nonprofit sector, including my own research and advocacy institute, is bringing them the tools they need to prioritize design issues in their cities and adapt infrastructure plans now. These tools include instruction in sustainable practices for government leaders, public education in environmental issues and specialized training for the country’s urban planners.

China must adopt this new approach quickly, before vast infrastructure investment makes the current model irreversible. By 2025, China is projected to have a staggering 200 cities with populations over one million. America has just nine.

Global prosperity depends on China’s continuing to be an engine of growth. We all need China to reinvent its economic model. Working together on urbanization creates progress toward joint solutions to the challenges the world faces from overwhelming pressure on natural ecosystems, resources and commodities.

We need Chinese cities to succeed, and we can help ensure that they do so.”

via How Cities Can Save China – NYTimes.com.

04/12/2012

To any thinking person, regardless of nationality, the Chinese unilateral claimed territorial waters (as shown by the red dotted line) look unreasonable. Furthermore, China has, up-till-now, maintained that force should come only after negotiations have failed. Compounding that, for a country who occasionally reminds the rest of the world about unequal treaties and ‘gunboat diplomacy‘, to threaten to board other nationality ships in what is disputed waters is not learning from its own history. This new ‘sabre rattling‘ is a great shame. given the high hopes everyone has for the new national leadership. Let’s hope this is a short term aberration that will soon be corrected.

03/12/2012

* Post transition, China looking to build ties with neighbours

Talking of mixed messages: on the one hand we hev the Indian Navy trying to establish a position in South China Sea to protect its oil and gas interests there; on the other hand we have foreign ministers shaking hands and vowing better ties between neighbours. Which is the REAL message? And who is trying to fool whom?

The Hindu: “Chinese State Councillor Dai Bingguo told National Security Adviser Shivshankar Menon here on Monday that China was looking to forge stronger ties with its neighbours following the leadership transition.

National Security Adviser Shivshankar Menon with Chinese State Councillor Dai Bingguo, his counterpart as the Special Representative on the boundary talks, at the Diaoyutai State Guesthouse in Beijing on Monday. Photo: Ananth Krishnan

Mr. Dai, who is also Mr. Menon’s counterpart as the Special Representative (SR) on the boundary talks, said Monday’s visit had assumed “special and important” significance as it was one of the first visits by a foreign leader to China following November’s Party Congress, which formalised a once-in-a-decade leadership transition.

“You’re one of the first few foreign leaders we are receiving after the party congress,” Mr. Dai told Mr. Menon at their first session of talks. “I’m sure through your visit the Indian side will have a better sense of China after the eighteenth Party Congress and China’s foreign policy, and how best to join forces to further promote the development of China-India relations”.

The first session of Monday’s talks was devoted to briefing Mr. Menon on China’s transition. Two other sessions later on Monday will focus on Sino-Indian relations and are expected to cover a range of topics from the boundary question to wider strategic issues.”

via The Hindu : News / National : Post transition, China looking to build ties with neighbours.

01/12/2012

* Chinese tycoons advised on charity

China Daily: “Western experience sought after to advance China’s development

The newly rich in China are looking to the West for experience again. But this time, they want to learn how to spend money, rather than how to make it.

Zhang Xin, CEO and co-founder of Soho China, a leading real estate developer, said she had no clear strategy when she started her journey into philanthropy.

“In the early days, when I established the Soho China Foundation, we did not have a clear plan. We gave money to build a school here and set up a kindergarten there and rushed to help people affected by a tsunami,” Zhang said.

Zhang said she gradually realized that it is important to discover the pressing social problems China faces and then choose one field that requires a huge investment of money and human capital.

The female billionaire said her foundation started the project Teach for China, which is dedicated to training teachers in rural schools in Northwest China’s Gansu province, one of the most impoverished provinces, six years ago.

“Teach for China is what we learned from an American foundation,” she said.

Zhang made her remarks at the China Philanthropy Forum 2012, which was jointly held on Friday by the China Association for International Friendly Contact, Caijing Magazine and other organizations in Beijing.”

via Tycoons advised on charity |Society |chinadaily.com.cn.

30/11/2012

* China-backed payment processor to accelerate global expansion

Visa and Mastercard beware!

Reuters: “China’s state-backed electronic payment services giant, China UnionPay, launched an international arm tasked with speeding its expansion overseas, heating up competition with rivals such as Visa Inc (V.N) and Mastercard Inc (MA.N).

The logo of the China UnionPay is seen at a bank in Taiyuan, Shanxi province July 20, 2012. REUTERS/Stringer (CHINA - Tags: BUSINESS)

The move underscores UnionPay’s growing global ambitions, and follows a World Trade Organisation (WTO) ruling that China discriminates against foreign card companies by favoring UnionPay in the home market.

UnionPay, China’s dominant payment card supplier, is looking to expand the number of shops and outlets overseas that will accept its cards and also grow the number of partner banks issuing UnionPay-branded cards. The move would increase its business, assist inbound and outbound travelers and is also aimed at promoting the use of the yuan as a global currency.

“UnionPay’s internationalism provides convenience to Chinese residents and companies going overseas. Also it provides a new payment option for overseas residents and companies,” Liu Shiyu, deputy governor of the People’s Bank of China, said at the opening ceremony of UnionPay’s unit.”

via China-backed payment processor to accelerate global expansion | Reuters.

28/11/2012

* China Looks to Increase India Investments

If India allows China to invest in its under-developed infrastructure, then it will be a truly win-win situation.

WSJ: “China, already India’s largest trading partner, is looking to increase its Indian direct investment, taking a page from the playbook of other East Asian nations such as Japan and South Korea.

Zhang Ping, chairman of China’s National Development Reforms Commission, a key policymaking body, was in the Indian capital this week to hold a China-India strategic economic dialog, focused on increasing investments in each other’s countries. He was accompanied by around 200 representatives from government and corporations.

China’s official news agency Xinhua quoted Mr. Ping as saying China would “push forward cooperation in infrastructure including railway, power, telecommunications” with India.

“Economic co-operation between India and China is of relatively recent vintage and still has great potential to develop further,” said Montek Singh Ahluwalia, deputy chairman of India’s Planning Commission. He said China’s co-operation could be valuable in bridging India’s “enormous infrastructure deficit.”

Infrastructure is a particularly attractive sector for many foreign direct investors: India expects to spend $1 trillion on infrastructure over the next five years.”

via China Looks to Increase India Investments – China Real Time Report – WSJ.

28/11/2012

* China considers easing family planning rules

Given that it takes years or even decades for population policies to make a difference, China better get on with any changes; and never mind being gradual about it.

Reuters: “China is considering changes to its one-child policy, a former family planning official said, with government advisory bodies drafting proposals in the face of a rapidly ageing society in the world’s most populous nation.

Proposed changes would allow for urban couples to have a second child, even if one of the parents is themselves not an only child, the China Daily cited Zhang Weiqing, the former head of the National Population and Family Planning Commission, as saying on Wednesday.

Under current rules, urban couples are permitted a second child if both parents do not have siblings. Looser restrictions on rural couples means many have more than one child.

Population scholars have cited mounting demographic challenges in their calls for reform of the strict policy, introduced in 1979 to limit births in China, which now has 1.34 billion people.

Zhang said the commission and other population research institutes have submitted policy recommendations to the government.

Zhang, who serves on China’s congressional advisory body, said any changes if adopted would be gradual.

via China considers easing family planning rules | Reuters.

28/11/2012

* China to tighten laws on land grabs in rural stability push

The new leadership is already taking steps to improve conditions for the rural population of China. That is assuming local authorities take heed of central edicts.

Reuters: “China’s cabinet vowed on Wednesday to tighten laws on the expropriation of farmland, warning that the problem risked fuelling rural unrest and undermining the country’s food security.

“Rural land has been expropriated too much and too fast as industrialization and urbanization accelerate,” state news agency Xinhua reported, summing up a meeting of the State Council.

“It not only affects stability in the countryside but also threatens grain security.”

More reforms need to be put in place and a better legal system set up to resolve the problem, including stricter regulation on farmland expropriation, Xinhua said.

The meeting passed a draft law amendment altering rules on how to compensate farmers whose “collectively owned” land is expropriated, the news agency said, without providing details.

“The government must make efforts to beef up support for farmers and place rural development in a more important position,” it added.

While the comments on land seizures do not break new policy ground, they do underscore government jitters about rural discontent as President Hu Jintao prepares to hand over the running of the country to his successor, Vice President Xi Jinping, named Communist Party head this month.

Farmers in China do not directly own most of their fields. Instead, most rural land is owned collectively by a village, and farmers get leases that last for decades.

In theory, the villagers can collectively decide whether to apply to sell off or develop land. In practice, however, state officials usually decide. And hoping to win investment, revenues and pay-offs, they often override the wishes of farmers.

The number of “mass incidents” of unrest recorded by the e government grew from 8,700 in 1993 to about 90,000 in 2010, according to several government-backed studies. Some estimates are higher, and the government has not released official data for recent years.

Conflict over land requisitions accounted for more than 65 percent of rural “mass incidents”, the China Economic Times reported this year, citing survey data.”

via China to tighten laws on land grabs in rural stability push | Reuters.

27/11/2012

* Starbucks Plays to Local Chinese Tastes

WSJ: “After nearly 14 years of working to persuade China to buy into its foreign coffee culture, Starbucks Corp is aiming to become more Chinese as it plans a rapid expansion in the country.image

Belinda Wong, president of Starbucks China, said in an interview that Starbucks aims to roll out 800 new stores in the next three years to add to its existing fleet of 700. Over that period it will increase the number of employees to more than 30,000 from the current 12,000.

The company aims to capture a larger market by going more local and applying its cultural insights, Ms. Wong said. For instance, whereas kiosk-sized stores work well in the U.S., where office workers grab bacon-gouda sandwiches to go in the morning on the way to work, Starbucks has learned that Chinese consumers value space and couches on which to relax in the afternoons.

The coffee company is adding some stores that are nearly 3,800 square feet and can seat consumers who come with groups of friends and business partners. Starbucks also has discovered that Chinese tastes for coffee go only so far. It plans to introduce new Chinese-inspired flavors, building on existing favorites like red bean frappuccinos.

Localization is a critical factor in the success or failure of foreign companies in China. Yum Brands Inc has thrived in China by adding fried shrimp and soy milk, among many other Chinese items, to its KFC outlets and fresh seafood bacon pizza and Thai-style fried rice to its Pizza Huts.

Businesses that have failed to grasp the local culture, importing alien models, have fallen out of favor. In September, Home Depot Inc closed all seven of its remaining big-box stores in China after years of losses, having discovered that the do-it-yourself home improvement model doesn’t work well in a do-it-for-me Chinese culture. Best Buy Co closed its nine China outlets in February 2011 after discovering consumers needed washing machines, not espresso makers or stereos.”

via Starbucks Plays to Local Chinese Tastes – WSJ.com.

Law of Unintended Consequences

continuously updated blog about China & India

ChiaHou's Book Reviews

continuously updated blog about China & India

What's wrong with the world; and its economy

continuously updated blog about China & India