Once again, some signs that China is ‘softening’ on contovertial cases. Question is: is it a general policy or only for this year, the year of leadership change?
09/08/2012
* Defects found on 12 rail lines
China Daily: “Seven of the 12 lines have been put into service, including high-speed passenger railways between Wuhan and Guangzhou and between Zhengzhou and Xi’an, according to the document.
The problems were discovered during routine inspections. The construction defects on the seven lines included cracks and leaks on tunnel arches, tilted communications towers and poorly arranged electronic cables, the Chinese news portal eeo.com.cn reported on Tuesday.
Other problems were found on five lines currently under construction, including one linking Lhasa and Xigaze in the Tibet autonomous region, which is an extension of the Qinghai-Tibet railway.
The ministry severely criticized some contractors for building with low-quality materials and not using enough iron bars in reinforced concrete.
Media reports quoted anonymous experts as saying the defects might threaten railway safety.
Cracks on the railway tunnel’s arch could cause concrete chunks to break off when a high-speed train passes, destroying the train’s power supply equipment, they said.
A ministry official who spoke to China Daily on the condition of anonymity confirmed the authenticity of the document, saying it was meant to be circulated inside the ministry and to relevant parties.
He said the ministry is paying great attention to quality issues, and has organized regular inspections on railway construction and operations.”
via Defects found on 12 rail lines |Society |chinadaily.com.cn.
Good news: in the past such information would not have seen the light of day; bad news: too many defects in a key transport and communications system.
See also:
09/08/2012
* China factory output growth at three-year low, spurs easing hopes
Reuters: “Annual growth in China’s factory output slowed to its weakest in more than three years in July, missing market forecasts and increasing expectations that Beijing will take further policy steps to support an economy that has been sliding for six straight quarters.
Official data released on Thursday also showed China’s annual consumer inflation fell to a 30-month low in July, suggesting that the central bank has ample scope to ease policy again after rate cuts in June and July to keep the economy on track to meet an official 2012 growth target of 7.5 percent.
China’s economy faces powerful headwinds as the euro zone debt crisis and a sluggish U.S. recovery keep global growth at a low ebb, the main factor that pushed China’s new export orders in July into their steepest fall in eight months.
“The government underestimated the pace of slowdown and there needs to be more aggressive stimulating policies,” said Alistair Thornton, an economist at IHS Global Insight in Beijing.
“The government has signaled that it’s taking a more aggressive line on stimulus measures … But it’s yet to feed into the real economy, which is why we are seeing such weak activities data for July.”
Hopes of further easing from China boosted riskier assets, with Asian shares rising to a three-month high and the commodity-sensitive Australian dollar testing a 4-1/2-month peak.
China’s industrial output growth slowed to 9.2 percent year-on-year in July, its weakest since May 2009, down from 9.5 percent in June and below the 9.8 percent forecast in a Reuters poll.
Annual growth in fixed-asset investment, in the likes of real estate, roads and bridges, came in at 20.4 in January-to-July, unchanged from the January-to-June period and just below the 20.5 percent forecast.
Growth of retail sales, the biggest driver of the economy’s expansion in the first quarter, eased to 13.1 percent, short of the forecast of 13.7 percent.”
via China factory output growth at three-year low, spurs easing hopes | Reuters.
09/08/2012
* China inflation rate dips to a 30-month low in July
BBC News: “China’s inflation dipped to a 30-month low in July, giving policymakers a bigger cushion to boost stimulus measures to spur economic growth.
Consumer prices rose by 1.8% in July, from a year earlier. That was down from a 2.2% growth rate in June and a 3% rise in May.
China has been looking to spur domestic consumption amid a slowing global demand for its exports.
China’s economy grew at its slowest pace in three years in second quarter.
The drop in prices of pork and meat and poultry products, which fell by 18.7% and 6.1% from a year earlier respectively, were the key drivers of the slowdown in the rate of inflation.
China’s economy grew at an annual rate of 7.6% in the April to June period, down from an 8.1% expansion in the previous three months.
There are fears that growth in the world’s second-largest economy may slow further in the coming months.
As a result, Beijing has taken various measures to spur growth.”
via BBC News – China inflation rate dips to a 30-month low in July.
09/08/2012
* Bo Xilai scandal: Gu Kailai on trial for Neil Heywood death
BBC News: “The first day of the trial of the wife of former high-flying Chinese lawmaker Bo Xilai on charges of murdering UK businessman Neil Heywood has ended.
Gu Kailai is accused of poisoning Mr Heywood in 2011 in Chongqing, where her husband was the Communist party head.
State media has called the case against her and an aide “substantial”.
The country is preparing to install a new generation of leaders, and Bo Xilai had once been seen as a strong contender for one of the top jobs.
He was sacked in March and is currently under investigation for unspecified “disciplinary violations”.
The BBC’s John Sudworth says some Chinese leaders are said to welcome the demise of such an openly ambitious colleague, but the case still needs careful handling for fear it might taint the Communist Party itself.”
via BBC News – Bo Xilai scandal: Gu Kailai on trial for Neil Heywood death.
Related articles
- Bo Xilai’s son defends mother (edition.cnn.com)
- China To Allow British Diplomats To Attend Trial Of Bo Xilai’s Wife For Neil Heywood Murder (freeinternetpress.com)
07/08/2012
* In China’s Power Nexus, a Tale of Redemption
WSJ: “Liu Minghui’s battle to clear his name and save his business, a fight that pitted him against some of the most powerful forces in China, began the day of his company’s Christmas party in 2010.
Mr. Liu was set to leave his 18th-floor office in Shenzhen to cross the nearby border to Hong Kong for the party when plainclothes Public Security Bureau officers arrested him on suspicion of stealing money from the company he ran and co-founded, China Gas Holdings Ltd.
The former managing director spent nearly the next year in a Chinese jail, during which time he was forced to leave his executive and board roles at the company while remaining a substantial shareholder. He emerged from detention in time to see one of the country’s biggest companies launch a hostile offer for China Gas, the first by a state-owned business against a privately controlled company.
Now Mr. Liu’s comeback is nearly complete. He has been exonerated in the embezzlement case and is poised to win his fight with state-owned energy giant China Petroleum & Chemical Corp., or Sinopec, and its partner, ENN Energy Holdings Ltd. The bidding consortium on Monday extended the deadline for the US$2.15 billion offer until early September, saying the bid is still waiting regulatory approval. But with the stock trading at a 22% premium to the offer price of 3.50 Hong Kong dollars a share, the group seems unlikely to attract the shareholder support needed to take control.
…
The case highlights the harsh nature of business in China, where the legal system is opaque and the fate of companies can be decided in Beijing. It remains unclear why Mr. Liu was arrested and then cleared, why Sinopec bid for his company and why a surprising group of white knights came to Mr. Liu’s rescue.”
via In China’s Power Nexus, a Tale of Redemption; Sinpec, China Gas, Liu Menghui – WSJ.com.
In the same issue of WSJ.com, this article shows the positive (though still opaque) side of Chinese criminal justice and another the opposite: https://chindia-alert.org/2012/08/07/chinese-criminal-procedure-at-its-worst/
Related articles
- Beijing Enterprises Raises Stake in China Gas to 20.30% (blogs.wsj.com)
- China Gas Doesn’t Think ENN-Sinopec Takeover Bid Will Succeed (blogs.wsj.com)
07/08/2012
* Chinese Criminal Procedure at its Worst
WSJ: “On July 23rd in Guizhou province, lawyers obtained a partial victory for some of the defendants accused of involvement in organized crime. Not all the accused were as fortunate, and the limited results came with the support of an intense Internet campaign to publicize gross violations of China’s Criminal Procedure Law by police and judges.
This case shows Chinese criminal procedure at its worst. It exposes extensive cooperation between police and court officials in violating Chinese procedural law to obtain convictions in a case brought during a nation-wide campaign with strong political overtones. At the same time, it also provides a glimpse of the work of dedicated lawyers defending their clients and how they have begun to use the Internet to publicize the problems they encounter. The case is reported in great detail in a blog post on Tea Leaf Nation that is well worth reading and is the source of the following account of the events in this case to date.
In March 2010, Li Qinghong, a real-estate businessman, was sentenced to 19 years in prison for alleged involvement in organized crime The case against Li and 16 others had begun in 2008 with a charge of gambling, but escalated in 2010 when a nation-wide “crackdown” campaign against organized crime was launched. In this case, the Guizhou Provincial Coordination Office to Fight Organized Crime organized a meeting to mobilize police, prosecutors and courts to cooperate closely.
The case was remanded by the Guizhou Provincial Court for “lack of factual clarity,” and the Guiyang City District Court reprosecuted the case this year and increased the number of defendants to 57. The defendants’ lawyers took to the Internet to appeal for additional legal assistance, and were ultimately joined by lawyers from outside Guiyang Province. According to the CCP-led Global Times, a total of 88 lawyers formed a panel for the defense.
The defense lawyers say they regarded the case as a test of the entire criminal defense system, because it involved illegally obtained evidence, false testimony and the complicity of police and the courts in these procedural violations. At the trial more than 10 defendants testified to having been tortured, the police were not allowed to testify, and the court refused to exclude evidence that allegedly had been obtained illegally, according to the Tea Leaf Nation account. In addition, during the proceedings the court expelled four lawyers for their aggressive arguments on procedural violations.
The account goes on to say that court officers promised the defendants who were represented by lawyers from outside of Guizhou that they would receive lenient sentences if they fired those lawyers, which some did — only to reveal three weeks later that they had released their lawyers solely because of great pressure on them. Some of those defendants then rehired their lawyers. After these events, one lawyer was quoted as saying “The criminal defense system in China is near its doomsday.”
The defense lawyers took their efforts to the public via the Internet in addition to vigorous arguments in court. They say that at issue was “the last defense, a life-or-death moment for the rule of law and for criminal defense.” They obtained only a partial victory: Although some defendants were found innocent, defendant Li Qinghong was sentenced to 15 years in prison. Li has appealed.
The defense lawyers ascribed their (partial) success to a massive use of microblogs, having posted more than 1,000 tweets, including extensive daily updates via Sina Weibo, during the 47-day trial. They emphasized that their use of social media filled a vacuum created by traditional media’s lack of attention to the case. They are quoted in the blog post as saying that these efforts, in addition to raising netizens’ awareness of the issues at stake in their case, “balanced the voice of the official media,” and helped to protect the lawyers’ personal safety.”
via Chinese Criminal Procedure at its Worst – China Real Time Report – WSJ.
In the same issue of WSJ.com, this article shows the ‘worst of’ Chinese criminal justice and another more ‘positive’ case: https://chindia-alert.org/2012/08/07/wsj-in-chinas-power-nexus-a-tale-of-redemption/
See also: http://unintend-conseq.blogspot.co.uk/2012/08/social-media-triggers-revolutions.html
07/08/2012
* DreamWorks Plans Studio in Shanghai
WSJ: “DreamWorks Animation SKG Inc. on Tuesday signed plans with Chinese partners to build a $350 million movie studio in Shanghai to capitalize on the success of its Kung Fu Panda film franchise as the studio looks to build up its presence in a fast-growing Chinese movie market.
The studio will be 45% owned by the California animation company, with the remainder held by media-related companies controlled by the Shanghai government. The partners also plan an entertainment zone that could bring the total investment to 20 billion yuan (US$3.14 billion) to be largely funded in China.
The foundation of the project is the animation studio, DreamWorks CEO Jeffrey Katzenberg said in an interview. “The talent must exist here in China if only they had the knowledge, training and opportunity,” he said.
The partners said the film “Kung Fu Panda 3″ will be co-produced in Shanghai for a 2015 or 2016 release. The Shanghai studio plans its first film by 2017 and would build toward one to three major films a year, with an aim to build an animation base in China that can produce films for a world-wide market.
The joint venture said on Tuesday that it plans to build a tourism and entertainment complex that it calls the Dream Center with an opening date of 2016 in Shanghai’s Xuhui district. The facility near an abandoned airport will include tourist attractions, restaurants and commercial space, the joint venture said. Mr. Katzenberg said his company will help design that aspect of the business but be a small minority partner in the park, which represents the largest share of the investment plans.
The moves—which were announced in part earlier this year—come as rival Walt Disney Co. also looks to build up its presence in Shanghai. The U.S. entertainment company last year began construction of its own $4.4 billion theme park with Shanghai-government partners that will also include hotels, restaurants and other amenities.
Western entertainment companies are looking for ways to tap the fast-growing Chinese entertainment market. China’s box-office revenue surged 42% in the first half of the year to $1.28 billion as increasingly affluent consumers head to the movies. But the domestic industry is still underdeveloped, with foreign productions dominating the business. Mr. Katzenberg said American movies have represented 70% of the Chinese box office so far this year.”
06/08/2012
* Chinese Consumer Products Get More Competitive
WSJ: “Gone are the days when big multinationals in China could easily dominate every consumer segment from toothpaste to laundry detergent.
For years, companies such as Procter & Gamble Co. PG mainly had to worry about counterfeits, as their brands, such as Crest, were the hot items for the newly expanding consumer market.
That isn’t always the case anymore.
Take for instance a Chinese herbal toothpaste for whitening and sensitive gums. It sells for the equivalent of about $8.60, roughly double the price of Crest 3D White Vivid, one of P&G’s pricier brands. Yet the herbal toothpaste’s market share in China grew to 8.8% in 2011 from 1.1% five years ago, according to market research firm Euromonitor International. Over that same period, P&G’s market share in the toothpaste category fell to 19.7% from 20.8%. Toothpaste market share in China for Unilever NV, which sells the Zhonghua brand there, fell to 9.9% from 12%, according to Euromonitor. (In other markets, Unilever produces Close Up and Signal brand toothpastes.)
Industry insiders say losses of a point or two are small enough in the short term for foreign companies to manage. But the Chinese brand, made by Yunnan Baiyao Group Co., one of many local competitors gaining market share at the expense of foreign giants, is a sign of a changing consumer environment, some people say.
“P&G and Unilever will have to fight harder for shelf space and fight harder to differentiate from domestic brands that are now offering a wider range of products and features,” said Ben Cavender, a senior analyst at China Market Research Group.
Chinese companies like Yunnan Baiyao are gaining as they sharpen their branding.”
via Chinese Consumer Products Get More Competitive – WSJ.com.
Related articles
- What Chinese Consumers Want (alignment.wordpress.com)
- High Street brands head East (bbc.co.uk)
06/08/2012
* China arrests 1,900 in crackdown on fake drugs
BBC News: “Police in China have arrested more than 1,900 people in a crackdown on the manufacture and sale of fake medicine, authorities said.
The country-wide operation began on 25 July, the Ministry of Public Security said in a statement.
Police seized products worth 1.16bn yuan ($182m; £117m).
These included millions of pills made to look like well-known brands used to treat diabetes, hypertension, skin problems and cancer, it said.
Despite the arrests, the problem of fake medicine was ”far from being rooted out”, authorities said.
Drug counterfeiting had become more ”elusive and deceptive” as ”criminals have come up with new methods” despite efforts to root out production and sale channels in recent years, they said.”
via BBC News – China arrests 1,900 in crackdown on fake drugs.
CHINDIA ALERT: You'll be living in their world, very soon 