MARCHING by the thousands this week in stifling heat through their small coastal village, residents of Wukan carried Chinese flags and shouted out slogans in support of the Communist Party. That was just to protect themselves from retribution by the riot police, who watched them closely but did not intervene. Their real message was in other chants: “Give us back our land!” and “Free Secretary Lin!”
The secretary in question was their village chief, Lin Zulian, whom they elected in 2012 in what was widely hailed at the time as a breakthrough for grassroots democracy. Mr Lin had led Wukan in a months-long rebellion against local authorities. Villagers kicked out party officials and police from their offices in protest against the alleged seizure of some of Wukan’s land by corrupt officials who had lined their pockets with the proceeds of selling it. Police responded by blockading the village, turning it into a cause célèbre—including in some of the feistier of China’s heavily censored media. In the end the government backed down: it allowed Wukan to hold unusually free elections and it promised to sort out the land dispute. The “Wukan model” became Chinese reformists’ shorthand for what they hoped would be a new way of defusing unrest.
They have been disappointed. Villagers did not get their land back, or the money some wanted in lieu of it. Mr Lin, who won another landslide victory in elections two years ago, announced plans on June 18th to launch a new campaign for the return of the land. That was clearly too much for the local government: Mr Lin was promptly arrested on charges of corruption. Angry residents took to the streets again.
Villagers in China often stage protests over land rights; local authorities usually deal with them either with force, or by promising concessions and then rounding up the ringleaders. Restoring calm to Wukan will be tougher. Because of its fame, journalists have poured in, especially from nearby Hong Kong. Local officials may be reluctant to resort to the usual thuggish tactics in front of such an audience.
In an effort to undermine support for Mr Lin, the government has tried blackening his name. On June 21st officials released a video showing him confessing to bribe-taking. But that merely stoked the villagers’ anger. His wife, Yang Zhen, says she is certain the confession was coerced. His halting delivery in substandard Mandarin, she believes, was his way of letting villagers know this. “They are trying to deceive everyone, but no one believes it,” she says. Dozens of furious villagers went to a local school where nervous officials had barricaded themselves behind metal doors and barred windows; they kicked the doors and shouted abuse. As The Economist went to press, Wukan was preparing to embark on its sixth consecutive day of protest.
Many residents say they have lost all faith in the local government, and that only the central authorities in Beijing will be able to find a fair solution. “They took our land. My father and grandfather farmed it, and now I have nothing. No work and no other path forward,” says a 39-year-old villager. “We have a black government, all corrupt. They cannot trick us again with more talk of the ‘Wukan model’. We need our land back,” he fumes.
But the central government will be reluctant to cave in to the protesters’ demands. “Handling the Wukan problem well means much to the rest of China,” said Global Times, a pro-party paper in Beijing. But it warned that if the “drastic actions” of Wukan’s villagers were copied by others, China would “see mess and disturbance” at the grassroots. In a country where many seethe with grievances similar to Wukan’s, officials do not want the village to become a model for revolt.
Source: Unwanted model | The Economist
India has stepped up efforts to sell an advanced cruise missile system to Vietnam and has at least 15 more markets in its sights, a push experts say reflects concerns in New Delhi about China’s growing military assertiveness.
Selling the supersonic BrahMos missile, made by an Indo-Russian joint venture, would mark a shift for the world’s biggest arms importer, as India seeks to send weapons the other way in order to shore up partners’ defenses and boost revenues.
The government of Prime Minister Narendra Modi has ordered BrahMos Aerospace, which produces the missiles, to accelerate sales to a list of five countries topped by Vietnam, according to a government note viewed by Reuters and previously unreported.
The others are Indonesia, South Africa, Chile and Brazil.The Philippines is at the top of a second list of 11 nations including Malaysia, Thailand and United Arab Emirates, countries which had “expressed interest but need further discussions and analysis”, the undated note added.
A source familiar with the matter would only say the note was issued earlier this year.New Delhi had been sitting on a 2011 request from Hanoi for the BrahMos for fear of angering China, which sees the weapon, reputed to be the world’s fastest cruise missile with a top speed of up to three times the speed of sound, as destabilizing.
Indonesia and the Philippines had also asked for the BrahMos, which has a range of 290 km and can be fired from land, sea and submarine. An air-launched version is under testing.
They’d not drunk together since they were in the same army unit, fighting skirmishes with Vietnamese forces in the aftermath of a 1979 border war.
Now in their 50s, they’d come here shortly before an annual parliament meeting in March to fight a different kind of battle – to demand the welfare support that they say was promised to them, and millions of other veterans, on leaving the armed forces years ago.
The four veterans, all from the southern province of Hunan, are an example of the problem facing President Xi Jinping as he prepares to lay off 300,000 out of 2.3 million troops in the biggest restructuring of the People’s Liberation Army, or PLA, since the 1950s.
China already has at least six million PLA veterans on state welfare, thousands of whom have staged well-organized protests in recent years over what they see as insufficient government support. Traditionally the government has offered subsidies to former soldiers and reserved slots for them at state-run companies, though many veterans say officials don’t follow through or that the perks aren’t enough to make ends meet.
Now, with an economic slowdown threatening to cause millions of state sector layoffs, prominent military figures have warned that veterans’ protests could escalate if the government can’t provide jobs or sufficient welfare support for the 300,000 being laid off.
One of the largest veterans’ protests was in June last year when several thousand, mostly veterans of China’s war with Vietnam, wearing uniforms and medals, protested outside offices of the Central Military Commission, which commands the armed forces and is headed by Mr. Xi.
A month earlier, there was another big veterans’ protest outside a Beijing courthouse. Smaller demonstrations occur frequently in other cities, according to experts who monitor them.
Many other veterans have tried to sue the government or lodge formal petitions, as the four in the restaurant did. Before lunch, they said, they’d submitted one at a nearby building that houses the petitions office of the Central Military Commission.
Officials there took the petition and scanned their identity cards, but gave them neither a receipt nor a reply, they said. “They just told us to go back where we came from,” said one of the four, a 54-year-old former worker in a coal-washing plant. “We got the feeling it was useless to go there.”
It’s a small step in the right direction, driven more by necessity than enlightened policy.
That’s the view from economists on China’s move this year to put forward a range for its economic growth target rather than a single number. The head of the National Development and Reform Commission, China’s top economic planning agency, said early this month that the 2016 target is likely to be “6.5% to 7%,” the first time in recent memory that China has used such a band. The target is set to be officially released early next month when China’s parliament convenes.
For decades, Beijing beat its annual growth targets without breaking a sweat. More recently, as growth decelerated faster than expected, it has faced growing difficulty hitting its number, so a range provides more wiggle room.
This follows Beijing’s decision to add an “about” to both its 7.5% target in 2014 and its 7% target last year. The adjective proved handy when the actual growth figures wound up falling short both times.
The risk this year, economists say, is that even a 6.5% to 7% target may be too high, heaping pressure on local officials to artificially stimulate growth in ways that increase debt and blunt reform initiatives.
This is also the year that China sets a growth target for the coming five years that’s expected to be 6.5%, in line with a Communist Party goal of doubling per capita income by 2020 over 2010 levels. This benchmark also may be high, analysts said, given China’s many structural problems and so-far limited appetite for reform.
“If they really stick to the 6.5% target by adopting unsustainable policies, throwing up more credit, they face a bigger problem with debt down the road,” said Fitch Ratings Inc. analyst Andrew Colquhoun. “Many emerging market problems in the past have happened when countries veer off and start to believe their own hype on what growth is possible.”
If this initiative gathers momentum, China will do more for electric cars (and for climate change) than the rest of the world put together!
“The China-focussed consortium that bought bankrupt Swedish automaker Saab – and bet on going all electric – unveiled its first major deal on Thursday, a mammoth $12 billion (8 billion pounds) order for electric cars for a Chinese leasing company.
The single order for 250,000 electric vehicles, including 150,000 cars based on the Saab 9-3 sedan, appeared to be all but unprecedented. There were just 665,000 electric cars in the world and 83,000 in China as of the end of 2014, according to the International Energy Agency.
National Electric Vehicle Sweden (Nevs) said it would swiftly hire hundreds of workers in Sweden to start building cars for Panda New Energy, a Chinese firm it said leases zero-emission vehicles to chauffeur-driven fleets.
Those based on the Saab 9-3 compact sedan will have a new chassis for electric drive, with bodies built and painted in Sweden and sent to China for final assembly. No details were given about the other 100,000 but a company spokesman said they would primarily be built in China.
Nevs bought the assets of the bankrupt 70-year-old Swedish automaker in 2012 with the aim of transforming it into a leading global producer of electric cars. It exited corporate reorganisation procedures in April.
“This is a strategic collaboration for Nevs not only in terms of the numbers of vehicles, but it is also an important step to implement our vision and new business plan,” Nevs Vice Chairman Stefan Tilk said in a statement.
“Cooperating with many chauffeured car service platforms in China, Panda aims to become one of the biggest electric vehicle leasing companies in the world,” Nevs said of its customer.
Nevs, which was created in 2012, has so far sold only a limited number of gasoline-powered cars based on Saab’s latest model. The deal is the first it has signed in line with its plans to go electric.
“It will be a huge challenge to produce that many cars. Their around 800 suppliers will make up a substantial part of that challenge,” said Skovde University business administration professor Mikael Wickelgren.
Nevs is co-owned by a holding company called National Modern Energy Holdings, as well as the Beijing State Research Information Technology Co. (SRIT) and Chinese industrial park Tianjin Binhai Hi-tech industrial Development Area (THT).
Nevs said at the time of the purchase of Saab’s assets that it would convert the Saab 9-3 to electric power, while simultaneously developing an all-new model to produce in Sweden for the European market and in China for the Chinese market.
($1 = 6.4822 Chinese yuan renminbi)”
China will introduce tough controls on ship emissions at three key port areas from January to reduce sulfur dioxide which results in acid rain, causing respiratory difficulties and sometimes premature death, said the Ministry of Transport.
If strictly implemented the move would force oil suppliers to increase the supply of cleaner marine fuel, industry experts said. The ministry gave no details on how the new emissions rules would be enforced or penalties for non-compliance.
The new rules will apply to merchant ships navigating or anchoring in the waters of Pearl River Delta, Yangtze River Delta and the Bohai Bay rim, with a goal to cut sulfur dioxide by 65 percent by 2020 from the 2015 level, according to a document issued by the Ministry of Transport.
Similar emissions control areas exist in the North Sea and the north American coast.
Ships berthed at ports within the three Chinese emissions control zones will start using bunker fuel with a maximum sulfur dioxide (SO2) content of 0.5 percent from January 2016, the ministry said.
Hong Kong made it mandatory in July for merchant ships to switch to fuel with a SO2 content of 0.5 percent from high sulfur fuel. Neighboring Shenzhen port launched a voluntary fuel switching scheme in July this year that is expected to cost 200 million yuan ($31.07 million) in subsidies over three years.
Enforcement of the new emission measures will initially be up to individual ports, but the controls will be toughened in 2017 to cover all key ports in the three control areas.
They will be tightened further from the start of 2019, when ships entering control zones, not just berthed or anchored, will have to use 0.5 percent SO2 bunker fuel or below. Fishing, sports and military vessels will be exempt, said the ministry.
Oil consultancy ICIS estimated that majority of fuel use in China’s shipping sector is currently using fuel with 1-2 percent SO2 content.
The International Maritime Organization (IMO), a U.N. body which regulates merchant shipping, plans to introduce a global cap on ship emissions in either 2020 or 2025.
The IMO will carry out a review in 2018 that will include an assessment of the availability of low-sulfur fuel that will be used to decide the actual implementation date.
The IMF on Monday gave a major vote of confidence to China and its reform efforts, giving the renminbi greater weighting than the yen or pound as it included the currency in its elite basket of reserve currencies.
The vote by the board to make the renminbi the fifth currency in the basket used to value the IMF’s own de facto currency followed months of deliberation at the fund and years of lobbying by a Beijing eager for the recognition.
“The Rmb’s elevation to the club of elite global reserve currencies is a big step for China and a significant one for the international monetary system,” said Eswar Prasad, professor of economics at Cornell University and a former IMF China mission chief.
The renminbi will become the third biggest currency in the “special drawing rights” basket when it takes effect on October 1. The move is largely symbolic but Christine Lagarde, IMF managing director, called it a “milestone” in China’s economic reform “journey” and its integration into the global financial system.
Following the move the currency slipped 0.19 per cent to Rmb6.4374 against the dollar in offshore trading in Hong Kong.
The People’s Bank of China set its daily “fix” — the onshore rate around which the currency can trade 2 per cent either side — at Rmb6.3973 per dollar, its fourth consecutive slightly weaker rate.
Investors generally expect China to allow its currency to weaken gradually but few see much likelihood of a repeat of its 3 per cent August devaluation, which sent shockwaves through global markets.
A slowing economy means keeping the lights on in China is getting a whole lot easier.
The China Electricity Council, a state-backed industry group, is trimming its estimate of just how much power the country needs, after weak third-quarter economic data on Monday reinforced fears about a slowdown of China’s economy. The official Xinhua News Agency on Tuesday quoted Ouyang Changyu, deputy secretary general of the China Electricity Council, as saying the group had revised down its full-year electricity-demand estimate to 1% growth this year, from 2% previously. As recently as 2011, electricity demand had grown by 12% annually.
The revised estimate reflects both a slowdown in China’s overall growth rate—which is struggling to hit the government’s target of about 7% this year—as well as important changes in the type of growth China is experiencing. The government wants to make the country less reliant on the energy-intensive sectors that propelled growth for four decades and instead shift toward cleaner and higher-paying industries and companies, ranging from financial services to web-based startups. In the first nine months of 2015, electricity demand has grown by .8%, down from 3.9% growth in the same period last year.
Electricity demand that is falling far faster than the government’s GDP data is among the reasons economists and investors are skeptical over the accuracy of official growth figures. The government said Monday GDP rose 6.9% in the first quarter. Chinese Premier Li Keqiang said in 2007 – back when he was a more junior official — that he relied on electricity data among other hard figures to get a truer picture of the country’s economic health.
Beyond electricity, other reasons for skepticism over the data include the decline of both imports and exports during the third quarter, weaker-than-expected industrial production and decelerating fixed-asset investment.
The ramifications of China’s slowing demand for electricity are global, and could contribute to weaker bottom lines at big companies such as coal and natural gas producers. Hong Kong-listed coal giant China Shenhua Energy Co. said its coal sales had plummeted by nearly one-fifth this year. The company is exporting far more coal this year than it’s importing — a sharp turnabout from 2014, when it imported four times as much coal as it exported.
The decline in electricity demand growth could also further weigh on natural gas—a cleaner alternative to coal in electricity production—which has suffered from stagnant demand this year.
The continuing crisis is viewed, locally and globally, as a test of China’s control over the economy. The “Beijing put”—a perception that Chinese economy and markets are backstopped by the government—is under threat. That perception has underpinned the widespread belief that Chinese growth won’t fall much below 7%, because that is the government’s desired target and Beijing is omnipotent.
But if Beijing can’t stop the market’s tumble, there could be a sudden shift in the perception of exactly how far economic growth might fall under the weight of too much debt. If that floor crumbles and the Chinese economy spirals downward, it will make the drama surrounding Greece feel like a sideshow. China has been the largest contributor to global growth this decade; Greece’s economy is about the size as that of Bangladesh or Vietnam.