Chindia Alert: You’ll be Living in their World Very Soon
aims to alert you to the threats and opportunities that China and India present. China and India require serious attention; case of ‘hidden dragon and crouching tiger’.
Without this attention, governments, businesses and, indeed, individuals may find themselves at a great disadvantage sooner rather than later.
The POSTs (front webpages) are mainly 'cuttings' from reliable sources, updated continuously.
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BEIJING (Reuters) – China’s factory activity likely rose for a second straight month in April as more businesses re-opened from strict lockdowns implemented to contain the coronavirus outbreak, which has now paralysed the global economy.
The official manufacturing Purchasing Manager’s Index (PMI), due for release on Thursday, is forecast to fall to 51 in April, from 52 in March, according to the median forecast of 32 economists polled by Reuters. A reading above the 50-point mark indicates an expansion in activity.
While the forecast PMI would show a slight moderation in China’s factory activity growth, it would be a stark contrast to recent PMIs in other economies, which plummeted to previously unimaginable lows.
That global slump, caused by heavy government-ordered lockdowns, as well as the cautious resumption of business in China, suggests any recovery in the world’s second-largest economy is likely to be some way off.
“The recovery so far has been led by a bounce-back in production, however, the growth bottleneck has decisively shifted to the demand side, as global growth has weakened and consumption recovery has lagged amid continued social distancing,” Morgan Stanley said in a note.
“The expected slump in external demand has likely capped further recovery in industrial production.”
The latest official data showed 84% of mid-sized and small business had reopened as of April 15, compared with 71.7% on March 24.
Hobbled by the coronavirus, China’s economy shrank 6.8% in the first quarter from a year earlier, the first contraction since current quarterly records began.
That has left Chinese manufacturers with reduced export orders and a logistics logjam, as many exporters grapple with rising inventory, high costs and falling profits. Some have let workers go as part of the cost-cutting efforts.
A China-based brokerage Zhongtai Securities estimated that the country’s real unemployment rate, measured using international standards, could exceed 20%, equal to more than 70 million job losses and much higher than March’s official reading of 5.9%.
Sheng Laiyun, deputy head at the statistics bureau, said on Sunday migrant workers and college graduates are facing increasing pressures to secure jobs, while official jobless surveys show nearly 20% of employed workers not working in March.
Chinese authorities have rolled out more support to revive the economy. The People’s Bank of China earlier in April cut the amount of cash banks must hold as reserves and reduced the interest rate on lenders’ excess reserves.
The richest man in China opened his own Twitter account last month, in the middle of the Covid-19 outbreak. So far, every one of his posts has been devoted to his unrivalled campaign to deliver medical supplies to almost every country around the world.
“One world, one fight!” Jack Ma enthused in one of his first messages. “Together, we can do this!” he cheered in another.
The billionaire entrepreneur is the driving force behind a widespread operation to ship medical supplies to more than 150 countries so far, sending face masks and ventilators to many places that have been elbowed out of the global brawl over life-saving equipment.
But Ma’s critics and even some of his supporters aren’t sure what he’s getting himself into. Has this bold venture into global philanthropy unveiled him as the friendly face of China’s Communist Party? Or is he an independent player who is being used by the Party for propaganda purposes? He appears to be following China’s diplomatic rules, particularly when choosing which countries should benefit from his donations, but his growing clout might put him in the crosshairs of the jealous leaders at the top of China’s political pyramid.
Other tech billionaires have pledged more money to fight the effects of the virus – Twitter’s Jack Dorsey is giving $1bn (£0.8bn) to the cause. Candid, a US-based philanthropy watchdog that tracks private charitable donations, puts Alibaba 12th on a list of private Covid-19 donors. But that list doesn’t include shipments of vital supplies, which some countries might consider to be more important than money at this stage in the global outbreak.
The world’s top coronavirus financial donors
How Alibaba compares to the top five. No one else other than the effervescent Ma is capable of dispatching supplies directly to those who need them. Starting in March, the Jack Ma foundation and the related Alibaba foundation began airlifting supplies to Africa, Asia, Europe, Latin America and even to politically sensitive areas including Iran, Israel, Russia and the US.
Ma has also donated millions to coronavirus vaccine research and a handbook of medical expertise from doctors in his native Zhejiang province has been translated from Chinese into 16 languages. But it’s the medical shipments that have been making headlines, setting Ma apart.
“He has the ability and the money and the lifting power to get a Chinese supply plane out of Hangzhou to land in Addis Ababa, or wherever it needs to go,” explains Ma’s biographer, Duncan Clark. “This is logistics; this is what his company, his people and his province are all about.”
A friendly face
Jack Ma is famous for being the charismatic English teacher who went on to create China’s biggest technology company. Alibaba is now known as the “Amazon of the East”. Ma started the company inside his tiny apartment in the Chinese coastal city of Hangzhou, in the centre of China’s factory belt, back in 1999. Alibaba has since grown to become one of the dominant players in the world’s second largest economy, with key stakes in China’s online, banking and entertainment worlds. Ma himself is worth more than $40bn.
Officially, he stepped down as Alibaba’s chairman in 2018. He said he was going to focus on philanthropy. But Ma retained a permanent seat on Alibaba’s board. Coupled with his wealth and fame, he remains one of the most powerful men in China.
Media caption The BBC’s Secunder Kermani and Anne Soy compare how prepared Asian and African countries are
It appears that Ma’s donations are following Party guidelines: there is no evidence that any of the Jack Ma and Alibaba Foundation donations have gone to countries that have formal ties with Taiwan, China’s neighbour and diplomatic rival. Ma announced on Twitter that he was donating to 22 countries in Latin America. States that side with Taiwan but who have also called for medical supplies – from Honduras to Haiti – are among the few dozen countries that do not appear to be on the list of 150 countries. The foundations repeatedly refused to provide a detailed list of countries that have received donations, explaining that “at this moment in time, we are not sharing this level of detail”.
However, the donations that have been delivered have certainly generated a lot of goodwill. With the exception of problematic deliveries to Cuba and Eritrea, all of the foundations’ shipments dispatched from China appear to have been gratefully received. That success is giving Ma even more positive attention than usual. China’s state media has been mentioning Ma almost as often as the country’s autocratic leader, Xi Jinping.
AFP
So far…
Over 150 countries have received donations from Jack Ma, including about:
120.4mface masks
4,105,000testing kits
3,704ventilators
Source: Alizila
It’s an uncomfortable comparison. As Ma soaks up praise, Xi faces persistent questions about how he handled the early stages of the virus and where, exactly, the outbreak began.
The Chinese government has dispatched medical teams and donations of supplies to a large number of hard-hit countries, particularly in Europe and South-East Asia.
However, those efforts have sometimes fallen flat. China’s been accused of sending faulty supplies to several countries. In some cases, the tests it sent were being misused but in others, low-quality supplies went unused and the donations backfired.
In contrast, Jack Ma’s shipments have only boosted his reputation.
“It’s fair to say that Ma’s donation was universally celebrated across Africa,” says Eric Olander, managing editor of the China Africa Project website and podcast. Ma pledged to visit all countries in Africa and has been a frequent visitor since his retirement.
“What happens to the materials once they land in a country is up to the host government, so any complaints about how Nigeria’s materials were distributed are indeed a domestic Nigerian issue,” Olander adds. “But with respect to the donation itself, the Rwandan leader, Paul Kagame, called it a “shot in the arm” and pretty much everyone saw it for what it was which was: delivering badly-needed materials to a region of the world that nobody else is either willing or capable of helping at that scale.”
Walking the tightrope
But is Ma risking a backlash from Beijing? Xi Jinping isn’t known as someone who likes to share the spotlight and his government has certainly targeted famous faces before. In recent years, the country’s top actress, a celebrated news anchor and several other billionaire entrepreneurs have all “disappeared” for long periods. Some, including the news anchor, end up serving prison sentences. Others re-emerge from detention, chastened and pledging their allegiance to the Party.
“There’s a rumour that [Jack Ma] stepped down in 2018 from being the chairman of the Alibaba Group because he was seen as a homegrown entrepreneur whose popularity would eclipse that of the Communist Party,” explains Ashley Feng, research associate at the Centre for New American Security in Washington DC. Indeed, Ma surprised many when he suddenly announced his retirement in 2018. He has denied persistent rumours that Beijing forced him out of his position.
Image copyright GETTY IMAGESImage caption Ma discussed trade with then-President-elect Donald Trump in January 2017
Duncan Clark, Ma’s biographer, is also aware of reports that Ma was nudged away from Alibaba following a key incident in January 2017. The Chinese billionaire met with then-President-elect Donald Trump in Trump Tower, ostensibly to discuss Sino-US trade. The Chinese president didn’t meet with Trump until months later.
“There was a lot of speculation of time that Jack Ma had moved too fast,” Clark says. “So, I think there’s lessons learned from both sides on the need to try to coordinate.”
“Jack Ma represents a sort of entrepreneurial soft power,” Clark adds. “That also creates challenges though, because the government is quite jealous or nervous of non-Party actors taking that kind of role.”
Technically, Ma isn’t a Communist outsider: China’s wealthiest capitalist has actually been a member of the Communist Party since the 1980s, when he was a university student.
But Ma’s always had a tricky relationship with the Party, famously saying that Alibaba’s attitude towards the Party was to “be in love with it but not to marry it”.
Even if Ma and the foundations connected to him are making decisions without Beijing’s advance blessing, the Chinese government has certainly done what it can to capitalise on Ma’s generosity. Chinese ambassadors are frequently on hand at airport ceremonies to receive the medical supplies shipped over by Ma, from Sierra Leone to Cambodia.
China has also used Ma’s largesse in its critiques of the United States. “The State Department said Taiwan is a true friend as it donated 2 million masks,” the Chinese Foreign Ministry tweeted in early April. “Wonder if @StateDept has any comment on Jack Ma’s donation of 1 million masks and 500k testing kits as well as Chinese companies’ and provinces’ assistance?”
Perhaps Ma can rise above what’s happened to so many others who ran afoul of the Party. China might just need a popular global Chinese figure so much that Ma has done what no one else can: make himself indispensable.
“Here’s the one key takeaway from all that happened with Jack Ma and Africa: he said he would do something and it got done,” explains Eric Olander. “That is an incredibly powerful optic in a place where foreigners often come, make big promises and often fail to deliver. So, the huge Covid-19 donation that he did fit within that pattern. He said he would do it and mere weeks later, those masks were in the hands of healthcare workers.”
Image copyright GETTY IMAGESImage caption Ma at an Electronic World Trade Platform event with Ethiopian Prime Minister Abiy Ahmed last year
Duncan Clark argues that Ma already had a seat at China’s high table because of Alibaba’s economic heft. However, his first-name familiarity with world leaders makes him even more valuable to Beijing as China tries to repair its battered image.
“He has demonstrated the ability, with multiple IPOs under his belt, and multiple friendships overseas, to win friends and influence people. He’s the Dale Carnegie of China and that certainly, we’ve seen that that’s irritated some in the Chinese government but now it’s almost an all hands on deck situation,” Clark says.
There’s no doubt that China’s wider reputation is benefiting from the charitable work of Ma and other wealthy Chinese entrepreneurs. Andrew Grabois from Candid, the philanthropic watchdog that’s been measuring global donations in relation to Covid-19, says that the private donations coming from China are impossible to ignore.
“They’re taking a leadership role, the kind of thing that used to be done by the United States,” he says. “The most obvious past example is the response to Ebola, the Ebola outbreak in 2014. The US sent in doctors and everything to West Africa to help contain that virus before it left West Africa.”
Chinese donors are taking on that role with this virus.
“They are projecting soft power beyond their borders, going into areas, providing aid, monetary aid and expertise,” Grabois adds.
So, it’s not the right time for Beijing to stand in Jack Ma’s way.
“You know, this is a major crisis for the world right now,” Duncan Clark concludes. “But obviously, it’s also a crisis for China’s relationship with the rest of the world. So they need anybody who can help dampen down some of these those pressures.”
BEIJING, April 21 (Xinhua) — Chinese President Xi Jinping attaches great importance to poverty alleviation. He has addressed the issue on many occasions. The following are some highlights of his quotes.
— It is an essential requirement of socialism to eradicate poverty, improve people’s living standards and achieve common prosperity among the people.
— No single poor area or individual shall be left behind.
— Genuinely poor people are to genuinely shake off poverty. Poverty must be truly eliminated.
— The measurement for moderate prosperity lies in rural areas.
— Cadres play a key role in helping people shake off poverty.
— Eradicating poverty is a common mission of human beings.
— It will be the first time in the millennia-old history of the Chinese nation that absolute poverty is comprehensively eliminated.
— Being lifted out of poverty is not an end in itself but the starting point of a new life and a new pursuit.
Young people starting out in the jobs market face a hit to their prospects that could endure years after the Covid-19-induced downturn has run its course
A generation of angry youth raises the spectre of political instability
Freelance filmmaker Anita Reza Zein had grown used to jam-packed production schedules requiring her to put in long hours and run on little sleep. Until Covid-19 struck.
Today, the talented Indonesian is suddenly free. With five projects on hold and many more potentially cancelled, she now spends her time working on a personal project, doing research for her work and occasionally going for a ride on a bicycle.
“I feel calm and patient although I’m jobless. Maybe because it’s still the third week [of social distancing] and I still have enough savings from my previous work,” said the 26-year-old, who is from Yogyakarta. “But I imagine life will become tougher in the next few months if the situation gets worse.”
Like her, millions of youths are now part of a job market in Southeast Asia that has been ravaged by the coronavirus pandemic. They are the unlucky cohort of 2020 whose fortunes have changed so drastically, so quickly.
Freelance filmmaker Anita Reza Zein now spends most of her time at home as her projects have all been frozen due to the spread of Covid-19. Photo: Anita Reza Zein
Just three months ago, many eager graduates were about to partake in a strong economy and possibly land decent pay cheques.
Today, job offers are being withdrawn and hiring halted, leading to a spike in regional youth unemployment in the short term. In the long term, the effects on the Covid-19 cohort could lead to wider social and political problems.
JOB MARKETS SHUT
The virus’ impact on economies and the job market in the region has been swift and devastating. Borders have been slammed shut, workers ordered to stay at home, and thousands of companies closed every week.
The biggest problem is the lack of certainty about how long this will last – the longer the governments keep their countries on lockdown, the worse the economic impact.
In Indonesia, for example, the virus has caused almost 2.8 million people to lose their jobs, according to the Manpower Ministry and the Workers Social Security Agency. Likewise, in Malaysia, an estimated 2.4 million people are expected to lose their jobs, going by data from the Malaysian Institute of Economic Research (MIER).
is bracing itself for a 5.3 per cent contraction in GDP for the full year, the worst since the Asian financial crisis in 1997.
“We think about seven million jobs have been lost already, and the figure will hit 10 million if the outbreak drags on for two to three more months,” said Kalin Sarasin, council member and head of the Thai Chamber of Commerce.
Lockdown for 34 million people in capital Jakarta as Indonesia fights surge in coronavirus deaths
For young jobseekers, the outbreak of the Covid-19 pandemic could hurt even more, with companies unwilling to open up new jobs for them.
“My clients who were open to fresh graduates previously have realigned searches [for candidates] who have at least one year of experience, as it’s a lot faster for someone with experience to scale up quickly and contribute,” said Joanne Pek, a recruiter at Cornerstone Global Partners’ Singapore office.
For many small and medium-sized enterprises (SMEs) such as Singapore-based restaurant chain The Soup Spoon, saving jobs – rather than recruiting – is the priority.
“We don’t want to let anyone go during this period, so we’re focused on protecting jobs,” said co-founder and director Benedict Leow, who employs some 250 workers.
THE COVID-19 COHORT
The looming economic downturn could have distinct consequences for the Class of 2020 that will outlast the economic downturn itself.
For one thing, the paucity of jobs could result in the Covid-19 cohort becoming a “lost generation” of sorts, said Achim Schmillen, a senior economist at the World Bank Social Protection and Jobs Global Practice.
“Research from around the globe shows that graduating in a recession can have significant and long-lasting impacts that can affect the entire career. In particular, it can lead to large initial earnings losses which only slowly recede over time,” he said.
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Economics professor Jeff Borland of the University of Melbourne said that international studies showed that what happened to people when they first entered the labour market would affect them for the rest of their working lives.
“Many international studies have shown that trying to move into employment during a major economic downturn cuts the probability of employment and future earnings for a decade or more.
“Why this occurs is less well-established. Reasons suggested include being forced to take lower-quality jobs, losing skills and losing psychological well-being,” he said in a piece published on The Conversation website.
Malaysia sets up Covid-19 test zones in the capital to hunt for ‘hidden’ coronavirus cases
This could create “lasting scarring” on the graduates this year, said labour economist Walter Theseira.
“If their careers start badly, it would affect their earnings for a number of years because they would lack the same experience as peers who started in a more secure position,” the associate professor of economics at Singapore University of Social Sciences said.
Shrinking salaries and the downsizing of companies mean that graduates might have to seek out professions outside their areas of study to survive, said Grace Lee Hooi Yean, head of the Economics Department at Monash University, Malaysia.
She said youth unemployment in the country, which stands at 11.67 per cent, could rise sharply.
“This looming crisis could trap a generation of educated and capable youth in a limbo of unmet expectations and lasting vulnerability if the graduates are not ready to face reality and adapt to the new challenges,” she said.
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This is fast becoming the reality for final-year medical student Rebecca K. Somasundaram, who has been left without a job due to the pandemic.
After being offered a residency programme at a top specialist hospital in Kuala Lumpur, she was notified a month ago that her placement had been made void until further notice. This has thrown the 24-year-old’s plans into disarray as she was hoping to enter the workforce soon to pay off her student debts. Her plans to get married next year have also been put on hold temporarily.
“I am in constant talks with the hospital to see if there is any way I can join them soon but seeing how things are unfolding so quickly, I am slowly losing hope,” she said.
Over in Indonesia, the pandemic will trigger job losses on a national scale. To combat this, the government would need to introduce strong fiscal measures and beef up its social protection policies, said the country’s former minister of finance Muhamad Chatib Basri.
Many people on lower incomes tend to work in the extraction industry, such as mining and palm oil, and these are the first industries hit due to the global slowdown.
“The rich will be able to brave the storm, but the poor have no means to do so,” he said.
Singapore migrant workers under quarantine as coronavirus hits dormitories
SPECTRE OF 1997
With partial lockdowns imposed in the capital of Jakarta, more needs to be done to ensure that vulnerable citizens have access to food and financial support.
Without government intervention, economic woes could soon translate into political instability, a scenario last seen in the Asian financial crisis.
In 1997, waves of discontent sparked racial riots in Indonesia that toppled the country’s long-time strongman Suharto, while in Thailand a political crisis created the conditions for populist leader Thaksin Shinawatra to rise.
Rising discontent could have serious implications at the ballot boxes, warned Basri, who said young voters were a key voting bloc for President Joko “Jokowi” Widodo.
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In last year’s general elections, Jokowi proved a hit among the lower-educated youth who had benefited from the creation of largely unskilled jobs during his tenure.
“With more young people expected to become unemployed in the coming months, things will only get worse from here,” said Basri, who added that the country’s youth unemployment stood at almost 20 per cent in 2018.
Indonesia, which has 268 million people and is Southeast Asia’s largest economy, had 133 million workers as of last August, according to official data.
Close to 10 per cent or about 12.27 million are university graduates but among this group, about 5.67 per cent or some 730,000 were unemployed. This was higher than the country’s overall unemployment rate at that time, which was 5.28 per cent.
‘Ghosts’ deployed to scare Indonesians into staying home to slow spread of the coronavirus
GETTING IT RIGHT
Economists say, however, that all is not lost. Much will depend on policy and how governments focus on battling the virus on the public health and economic fronts. They point to Singapore, which has launched a robust response to the crisis.
On April 6, the Singapore government announced its third budget in two months to help companies and households tide over the crisis. In all, Singapore’s total stimulus package, which aims to save jobs and keep funds flowing to companies, will cost the government a massive S$59.9 billion (US$42 billion).
The Singapore government was also preparing for a labour market that would be reluctant to hire fresh graduates on a full-time basis, said Theseira.
“There are plans to implement large-scale subsidised traineeships, which may be more palatable to companies which are worried about taking on permanent headcount this year,” he noted. “As the economic situation improves, they can be converted to permanent positions.”
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While jobs were being created for fresh graduates, many would still have to temper their expectations, such as taking jobs with lower starting pay, said DBS Bank economist Irvin Seah.
“There are still some jobs to go around. There are still some companies that may need workers. But they will need to be realistic,” he said.
For instance, despite the downturn, Singapore telco Singtel expects to recruit over 300 fresh graduates for various permanent positions this year, according to Aileen Tan, the company’s Group Chief Human Resources Officer. Many of the new hires will be in new growth areas such as the Internet of Things, analytics and cloud.
The Singtel Comcentre building in Singapore. Photo: Roy Issa
Other companies that continue to hire include those in tech across the region, including e-commerce giant Shopee, food-delivery service Foodpanda and Amazon.
In Australia, Borland suggested helping young people to remain plugged into the labour market through government-funded paid internships, or even offering them loans to go for further studies and prevent a spell of unemployment.
For now, while some young jobseekers are taking a wait-and-see approach, the reality is hitting hard for others.
Final-year National University of Singapore student H.P. Tan had all but secured a job at a public relations firm last month, after three rounds of interviews.
The Faculty of Arts and Social Sciences undergraduate was rejected via an email from the agency, which said that they could no longer hire after Covid-19 started to drastically cut business.
“When I got that rejection, it was a turning point. I didn’t think I would be directly impacted,” said the 23-year-old.
“I also applied to a few other agencies but the response has been slow, so I am now freaking out at the possibility of not being able to find a job after graduation.”
Image copyright AFPImage caption A third of the current members of parliament have criminal cases pending against them
“We need to build a consensus on how to prevent individuals with a criminal record from contesting elections.”
A necessary, even obvious fundamental you would think of building the world’s largest democracy.
And when Sonia Gandhi, India’s most powerful politician, uttered those words three years ago, even her main opponent, the leader of the BJP agreed.
Yet since then, things have gone in the opposite direction – with more alleged lawbreakers among India’s lawmakers than ever, a third of the current parliament according to a watchdog called the Association for Democratic Reforms.
By some calculations, politicians with a criminal record are more likely to be elected than those with a clean slate – because, says the ADR, they have more illicit funds with which to buy votes.
And on Tuesday night, India’s cabinet sought to ensure there was even less chance of criminal politicians facing their own laws.
It issued an order overturning a Supreme Court ruling demanding the disqualification of any politician convicted for crimes punishable with more than two years in jail.
This was “to ensure that governance is not adversely impacted“, the government had argued, with no apparent irony intended.
Unusual speed
Arguably, of course, the government is right. Losing tainted local or national politicians – among them many accused murderers, rapists and fraudsters – could upset delicate political alliances and make it even harder to get laws passed.
So often derided for doing nothing, this time round the cabinet acted with unusual speed.
The urgency it appears is the impending conclusion of two cases involving key politicians, due before Prime Minister Manmohan Singh gets back to India from a trip to the US.
Image copyright AFPImage caption There’s been some criticism of criminal politicians
One concerns Lalu Prasad Yadav, a former railways minister and Congress party ally, charged with pocketing millions of dollars in subsidies for non-existent livestock.
Another concerns Congress MP Rashid Masood, already convicted of corruption and due to be sentenced next week. When the BBC asked his office for a comment, his assistant told us “he is unwell”.
“Don’t know whether to laugh or cry” tweeted MP Baijayant Panda in response to the government’s protective move.
He is a rare voice though inside the chamber campaigning against criminals sitting alongside him.
There’s been some other criticism outside, but not much. Indians have become very used to these kinds of shenanigans.
Almost forgotten already are calls in the Verma commission report into the December 16 Delhi gang rape case for all politicians accused of sexual crimes to be barred from office. Instead, six politicians charged with rape remain in office.
The opposition BJP has said it will oppose the cabinet order. But its record is just as murky, with even more accused criminals among its elected members in parliament and state assemblies than the Congress.
And with elections round the corner, none of the parties want to risk real reform right now, whatever they have signed up to in the past.
CHINDIA ALERT: You'll be living in their world, very soon 