Archive for ‘powerhouse’

22/05/2020

NPC: China begins move to impose controversial Hong Kong security law

Shoppers walking past a broadcast of Chinese Premier Li Keqiang delivering his speech at the opening of the NPCImage copyright AFP / GETTY
Image caption Shoppers walking past a broadcast of Chinese Premier Li Keqiang delivering his speech at the opening of the NPC on Thursday

China’s ruling Communist Party has set in motion a controversial national security law for Hong Kong, a move seen as a major blow to the city’s freedoms.

The law to ban “treason, secession, sedition and subversion” could bypass Hong Kong’s lawmakers.

Critics say China is breaking its promise to allow Hong Kong freedoms not seen elsewhere in China.

It is likely to fuel public anger and may even trigger fresh protests and demands for democratic reform.

The plan was submitted at the annual National People’s Congress (NPC), which largely rubber-stamps decisions already taken by the Communist leadership, but is still the most important political event of the year.

Hong Kong, a semi-autonomous region and an economic powerhouse, was always meant to have introduced such laws after the handover from British control to Chinese rule in 1997.

After last year’s wave of sustained and violent protest, Beijing is now attempting to push them through, arguing “law-based and forceful measures” must be taken to “prevent, stop and punish” such protests in the future.

On Friday, Hong Kong’s government said it would co-operate with Beijing to enact the law, adding it would not affect the city’s freedoms.

What is in Beijing’s proposed law?

The “draft decision” – as it is known before approval by the NPC – was explained by Wang Chen, vice chairman of the Standing Committee of the NPC.

It consists of an introduction and seven articles. Article 4 may prove the most controversial.

That article says Hong Kong “must improve” national security, before adding: “When needed, relevant national security organs of the Central People’s Government will set up agencies in Hong Kong to fulfil relevant duties to safeguard national security in accordance with the law.”

China could essentially place this law into Annex III of the Basic Law, which covers national laws that must be implemented in Hong Kong – either by legislation, or decree.

Addressing the congress, Premier Li Keqiang spoke of the economic impact of the coronavirus and on Hong Kong and Macau said: “We’ll establish sound legal systems and enforcement mechanisms for safeguarding national security in the two Special Administrative Regions.”

What do opponents say the dangers are?

Hong Kong is what is known as a “special administrative region” of China.

It has observed a “one country, two systems” policy since Britain returned sovereignty in 1997, which has allowed it certain freedoms the rest of China does not have.

Pro-democracy activists fear that China pushing through the law could mean “the end of Hong Kong” – that is, the effective end of its autonomy and these freedoms.

Last year’s mass protests in Hong Kong were sparked by a bill that would have allowed extraditions to mainland China.

Media caption Former Hong Kong governor Chris Patten: “UK should tell China this is outrageous”

The bill was paused, then withdrawn – but the protests continued until the virus outbreak at the end of the year.

The US has also weighed in, with President Trump saying the US would react strongly if it went through – without giving details.

It is currently considering whether to extend Hong Kong’s preferential trading and investment privileges.

Why is China doing this?

Mr Wang said the security risks had become “increasingly notable” – a reference to last year’s protests.

“Considering Hong Kong’s situation at present, efforts must be made at the state-level to establish and improve the legal system and enforcement mechanisms,” he is quoted as saying in state media.

Media caption The BBC’s Helier Cheung on Hong Kong’s 2019 protests

Beijing may also fear September’s elections to Hong Kong’s legislature.

If last year’s success for pro-democracy parties in district elections is repeated, government bills could potentially be blocked.

What is Hong Kong’s legal situation?

Hong Kong was under British control for more than 150 years up to 1997.

The British and Chinese governments signed a treaty – the Sino-British Joint Declaration – that agreed Hong Kong would have “a high degree of autonomy, except in foreign and defence affairs”, for 50 years.

This was enshrined in the Basic Law, which runs out in 2047.

As a result, Hong Kong’s own legal system, borders, and rights – including freedom of assembly and free speech – are protected.

But Beijing has the ability to veto any changes to the political system and has, for example, ruled out direct election of the chief executive.

Media caption Uproar on Monday in Hong Kong’s legislature

Source: The BBC

17/04/2020

China’s virus-hit economy shrinks for first time in decades

Train passengers arrive from WuhanImage copyright EPA

China’s economy shrank for the first time in decades in the first quarter of the year, as the virus forced factories and businesses to close.

The world’s second biggest economy contracted 6.8% according to official data released on Friday.

The financial toll the coronavirus is having on the Chinese economy will be a huge concern to other countries.

China is an economic powerhouse as a major consumer and producer of goods and services.

This is the first time China has seen its economy shrink in the first three months of the year since it started recording quarterly figures in 1992.

“The GDP contraction in January-March will translate into permanent income losses, reflected in bankruptcies across small companies and job losses,” said Yue Su at the Economist Intelligence Unit.

Last year, China saw healthy economic growth of 6.4% in the first quarter, a period when it was locked in a trade war with the US.

In the last two decades, China has seen average economic growth of around 9% a year, although experts have regularly questioned the accuracy of its economic data.

Its economy had ground to a halt during the first three months of the year as it introduced large-scale shutdowns and quarantines to prevent the virus spread in late January.

As a result, economists had expected bleak figures, but the official data comes in slightly worse than expected.

Among other key figures released in Friday’s report:

  • Factory output was down 1.1% for March as China slowly starts manufacturing again.
  • Retail sales plummeted 15.8% last month as many of shoppers stayed at home.
  • Unemployment hit 5.9% in March, slightly better than February’s all-time high of 6.2%.
Presentational grey line

Analysis: A 6% expansion wiped out

Robin Brant, BBC News, Shanghai

The huge decline shows the profound impact that the virus outbreak, and the government’s draconian reaction to it, had on the world’s second largest economy. It wipes out the 6% expansion in China’s economy recorded in the last set of figures at the end of last year.

Beijing has signalled a significant economic stimulus is on the way as it tries to stabilise its economy and recover. Earlier this week the official mouthpiece of the ruling Communist Party, the People’s Daily, reported it would “expand domestic demand”.

But the slowdown in the rest of the global economy presents a significant problem as exports still play a major role in China’s economy. If it comes this will not be a quick recovery.

On Thursday the International Monetary Fund forecast China’s economy would avoid a recession but grow by just 1.2% this year. Job figures released recently showed the official government unemployment figure had risen sharply, with the number working in companies linked to export trade falling the most.

Presentational grey line

China has unveiled a range of financial support measures to cushion the impact of the slowdown, but not on the same scale as other major economies.

“We don’t expect large stimulus, given that that remains unpopular in Beijing. Instead, we think policymakers will accept low growth this year, given the prospects for a better 2021,” said Louis Kuijs, an analyst with Oxford Economics.

Since March, China has slowly started letting factories resume production and letting businesses reopen, but this is a gradual process to return to pre-lockdown levels.

Media caption Why does China’s economy matter to you?

China relies heavily on its factories and manufacturing plants for economic growth, and has been dubbed “the world’s factory”.

Stock markets in the region showed mixed reaction to the Chinese economic data, with China’s benchmark Shanghai Composite index up 0.9%.

Japan’s Nikkei 225 jumped 2.5% on Friday, although this was largely due to gains on Wall Street after US President Donald Trump unveiled plans to ease lockdowns.

Source: The BBC

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