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Lei Feng: Portrait of a Paragon ECONOMY

Food Security: Grain Grab SOCIETY

TCM & Animal Rights: Bear Necessities

How the architectura ancient civilization b l wonders of an ecam of a modern natieothn’es victims success $4.99

Volume No. 045 May 2012





Published by China Newsweek Corporation Publisher: Liu Beixian Executive Directors: Liu Beixian, Zhou Jianming Editor-in-Chief: Wang Xiaohui

It is time to make the People’s Delegates for real


ith the development of social me- formulated into concrete legislature and governdia in recent years, the “two meet- ment policy, “progress” is an illusion. ings,” the National People’s Congress Under the current arrangement, delegates meet (NPC) and the Chinese People’s Political Consul- once a year for only two weeks, where few of their tative Conference (CPPCC), have become ever opinions can be discussed at length. For example, more entertaining, with in the discussion session of many influential celebrithe CPPCC, each memHowever, without a ties, academics and ofber is given just five minficials among the four utes to have their say, with mechanism through which thousand delegates. Many no established agenda. these opinions can be refer to March as “carnival Individual views are so formulated into concrete season” for China’s media. diverse that they are easlegislature and government While celebritiesily submerged in a sea of policy, “progress” is an turned-delegates strut their opinions. In total, 6069 illusion. stuff outside the Great proposals were submitted Hall of the People, many to the CPPCC this year, officials-turned-people’s which works out to 3 prorepresentatives have apposals per member. None peared more outspoken and critical of government of these have any prospect of becoming policy. policies than in previous years. The same is true for the NPC, to which 489 For example, Li Jiange, head of the China In- proposals were submitted this year. Without ternational Capital Corporation, fervently criti- carefully structured discussion and debate, as cized Finance Minister Xie Quren’s comment that well as the establishment of institutions for delthe 24 percent increase in government revenue in egates to interact and coordinate with each other, 2012, several times the increase in per capita in- these proposals also fail to coalesce into political come, was “reasonable.” Guangdong Party Secre- will. Delegates have long complained that their tary Wang Yang also openly complained that his proposals have not been taken into serious condecentralization reforms in Guangdong have met sideration. with legal barriers “from the top,” and declared that As the country’s two most important political he would petition higher authorities like a regular events, the two meetings are supposed to solve citizen. Wang Nanjian, head of the Guangdong tax China’s most urgent problems. But the fundamenbureau, lambasted the current tax policy. tal mechanism of the meetings is undermining It seems that this year, delegates and consultants their purpose. are full of complaints, suggestions and advice on As China is confronted with a variety of changes, how the nation should be governed. It is certainly it is time to restore the power granted to the two a sign of progress that delegates now have more meetings by China’s constitution, so that they can freedom to speak their minds. However, without contribute to much-needed economic and political a mechanism through which these opinions can be reform.


Editorial Office Managing Editor: Zheng Zhonghai Advisor: Liu Dizhong Senior Editor: Yang Yi Copy Editors: Jack Smith, Alex Taggart Lead Writer: Yu Xiaodong Editors: Wang Yan, Yuan Ye, Xie Ying, Sun Zhe, Li Jia First Reader: Wesley Jacks Address: 5th Floor, 12 Baiwanzhuang South Street, Xicheng District, Beijing, China Post Code: 100037 Tel: 86-10-88395566 Fax: 86-10-88388045 Email: Art Department Art Director: Wu Shangwen Art Editor/Designer: Zhang Dawei Marketing Office China Newsweek Corporation President: Wang Xiaohui Chief Executive: Fred Teng Tel: 1-212-481-2510 Fax: 1-212-481-2503 Address: Suite 1101, 15 East 40th Street, New York, NY 10016, USA Email: Toronto Office Director: Lai Hailong Address: 51 Halstead Drive, Markham, ON Canada L3R7Z4 Tel: 1-905-604-6150 Fax: 1-905-604-6170 Email: Marketing Director: Wang Chenbo Account Manager : Ren Jie Tel: 86-10-88388027 Circulation Manager: Yu Lina Tel: 86-10-88311834 Advertising Director: Gao Weiwei Tel: 1-212-481-2510 Marketing Promoter: Jerry Meng Tel: 1-212-481-2510 New York Office: Jing Xiaolin, Wei Xi, Sun Yuting Washington Office: Wu Qingcai, De Yongjian Los Angeles Office: Zhang Wei San Francisco Office: Liu Dan London Office: Wei Qun Tokyo Office: Sun Ran Paris Office: Wu Weizhong Bangkok Office: Yu Xianlun Kuala Lumpur Office: Zhao Shengyu Moscow Office: Tian Bing Legal Advisor: Allen Wu ISSN 1943-1902




Chai Society



02 It is time to make the People’s Delegates for real 10 The Two Meetings : Chorus For Reform

32 36 38

Educational Disparity : The Great Divide Educational Videos : Know Your Rights Slum Clearance : Out With the Old


12 THE PRICE OF PROGRESS : Making History, History/When Commerce Kills Culture Wang Shu: Struggling Against Suburbia

40 44 46


24 26 28

Cover Story


Household Registration : Route to Roots Hepatitis C : A Chronic Problem Animal Rights : Too Much to Bear

Food Security : Carving up the Crops E-commerce : Bring it Online iPad Battle : Golden Apples

50 Water Pollution : Protection Money history

53 Lei Feng : Man or Myth?

Photo by CFP

Despite consistent public and official opposition to the demolition (chai) of historic buildings, nothing short of a total realignment of government priorities can truly protect even national-level landmarks from the wrecking ball


56 Peking Opera : Resetting the Pace

visual report

60 Mao Lives

outside in

64 67

Surprising Dandong : Looking North Flavor of the Month : Counting Cartoon Sheep

04 MEDIA FOCUS 05 What They Say 06 NEWS BRIEF 08 Netizen Watch 49 China by numbers 66 real chinese 68 ESSAY 70 CULTURAL LISTINGS 72 Commentary



Vista February 28, 2012

The March of Hollywood In late February, China and the US sealed a new deal, whereby China agreed to import 14 more 3D or IMAX movies from the US per year, on top of the previous quota of 20. Some domestic directors worry a flood of Hollywood movies will push local movies out of the market, while others think it might urge the government to loosen censorship on Chinese movies, and step up the crackdown on piracy. Given that China retains the final say on which movies to import and when to screen them, analysts believe the agreement will still allow the government to protect domestic movies when necessary, while at the same time meeting China’s growing demand for foreign 3D and IMAX pictures.

Oriental Outlook February 28, 2012

Airport Tussle According to the Civil Aviation Administration, China will invest 425 billion yuan (US$62.5bn) in airport construction in the next five years, building or expanding over 160 airports. Yet, official statistics have revealed that over 70 percent of the country’s airports suffered losses last year. The aviation authority argued that the statistics paint an incomplete picture, claiming that new airports revitalize local economies and create jobs. Responding to the controversy, the State Council has issued a new regulation which for the first time defines airports as public facilities, in an effort to eliminate the profit-loss debate and allow airports to focus on improving service.


NewsChina Chinese Edition March 19, 2012

So Long, TV TV shows, once a highly popular form of entertainment among Chinese people, are falling out of favor with the country’s younger generations. Discussions on the popular Internet message board “Wave Goodbye to TV” regularly center around the idea that the content of most TV shows is of such low quality that it could actually be harming viewers. Experts attribute declining ratings to the dominance of online video websites, which are attracting droves of young people with the latest high-quality programming, including TV series from the West, popular Taiwanese talkshows, and international sports coverage. In order to boost their popularity, these video sharing websites are now working on producing their own content, potentially forcing State TV even further out of the market.

China Economic Weekly March 13, 2012

More Poverty Since 1986, when China launched its anti-poverty program, 679 counties nationwide have been listed as eligible for financial assistance and privileged policies for industrial development. But while the government is increasing its investment in the program year by year, the list is becoming longer. On the one hand, counties not yet listed are trying to manipulate growth figures in order to qualify for assistance, while on the other, many listed regions have been unable to wean themselves off the handouts. Experts say that failures in the system are due to a lack of coordination between the authorities and the inability of local governments to make optimum use of funds, and that anti-poverty measures should focus on helping each county develop its own core industry.

New Economics March 1, 2012

Huge Profits for Banks Data from China’s Banking Regulatory Commission have revealed that domestic commercial banks earned a net profit of 1.04 trillion yuan (US$164bn) in 2011, the highest since records began. In addition to commission and service fees, the huge profits mainly came from the large difference between interest rates on deposits and loans, since a shortage of funds in the finance market has given the banks the advantage over borrowers. Analysts have urged the government to remove the lower limit on loan interest, warning that unreasonably high rates are forcing enterprises into bankruptcy. Meanwhile, bankers are worried that full marketization would push the banks into a vicious price war. NEWSCHINA I May 2012

“Having local governments defend farmland from misuse is like putting a mouse in charge of protecting the cheese. When there’s a chance for profit, it’s impossible to ensure there won’t be misused by supervisors.” Illustration by Wu Shangwen

Wang Dongjing, a professor at the Central Committee Party School, on the danger of local governments selling farmland to construction firms. “Since the public’s tolerance of corruption has been pushed to the limit, the fight against corruption has become a do-or-die task for China.” Writer and Chinese People’s Political Consultative Conference (CPPCC) member Liang Xiaosheng in an interview with China Central Television.

“For years, motions to increase taxes have been approved with the speed of [Olympic hurdler] Liu Xiang, but reforms to reduce them are carried out at a pace slower than a snail.” Zhang Guojun, partner at PricewaterhouseCoopers and a member of the Chinese People’s Political Consultative Conference (CPPCC), on the plight of the Chinese taxpayer.

“Leftover women are a false worry. Leftover men are the real problem.” Li Jianxin, a sociology professor at Peking University, believing that men have a harder lot than women in the relationship market.

“Without your gaokao [the national college entrance exam], how will you compete with the rich kids?” A slogan displayed in a middle school in Zhejiang Province encouraging students to focus their efforts on the notoriously difficult exams.

“Outlaw the use of public funds to buy Moutai? Tell me, what type of alcohol should public funds be paying for?” Liu Zili, general manager for Moutai, China’s most famous alcohol brand, responding to his product being listed as a luxury good in February. NEWSCHINA I May 2012

“There are two simple reasons behind China’s rapid development since Reform and Opening-up: one is that we have stabilized [economically], the other is that we have regained part of our freedom.”

“The greater the problems, the tighter the government control. The tighter the government control, the greater the problems. It is a vicious circle that is intensifying toward a deadend.”

Yuan Weishi, a philosophy professor at Sun Yat-sen University, on China’s development.

Economist Wu Jinglian in an interview with Southern Weekend magazine.

“The strongest resistance to reform lies in various vested interest groups. Without the courage and determination to make them the target of revolution, these interests will never be broken.” Zhu Xiaodan, governor of Guangdong Province, on political reform.


Top Story

Controversial Revisions to Criminal Procedure Law Approved The National People’s Congress, China’s official legislature, approved revisions to the country’s Criminal Procedure Law during its closing session on March 14, the first major amendment to the statute since 1996. Set to be enacted on January 1, 2013, the latest revision made nominal concessions to “respecting and protecting human rights” in its wording on “basic principles.” The new amendments also explicitly rule evidence or confessions obtained through torture as inadmissible in a court of law, stating that “no-one will be forced to admit guilt.” Conversely, the new revisions allegedly expand police powers in certain areas, most prominently in prosecuting cases relating to terrorism, grand larceny and “subversion of State power.” Clause 73 of the revised statute grants police the power to detain those sus-


pected of such activities “for supervision in an appointed place,” while also absolving them of the requirement to inform a detainee’s family, a new power critics have claimed sanctions the “disappearing” of troublemakers. Xia Lin, a Beijing-based criminal lawyer told NewsChina that the country’s first amendment to the Criminal Procedure statute, approved in 1996, had officially abolished the detention of suspects outside of prisons or detention centers, whereas the new Clause 73 has reinstated the practice as legal. While detaining any citizen outside a prison or detention center for interrogation violates their rights under China’s Constitution, it remains a common method of keeping politically sensitive cases away from public scrutiny. “Detaining someone in an ‘appointed place’ is neither detention nor arrest,” said Xia. Wang Mingwen, a law professor who

spoke out against the amendments, published a criticism of the new provisions on his blog. “Clause 73 makes no effort to restrict ‘detentions in appointed places,’ thus keeping the torture option open,” he said. “It might nullify all efforts to remove illegal evidence submissions from court cases.”



Real-name Blogging Begins

Private Planes by 2015

Starting March 16, Beijing’s millions of Web users have had to register with their real names before using blogs to “deliver, forward or comment on information.” The new policy comes as part of new regulations on “blog management” issued by the Beijing municipal government, which also states that real names are required in the registration phase only, and will not be displayed on websites. Major portals like Sina and Tencent cautiously support the policy, claiming real-name registration reduces rumormongering and spam. However, Internet users have criticized the policy as intrusive, with some claiming it is designed to make it easy to identify people debating sensitive political issues.

China will tentatively begin to open low-altitude airspace to civilian aircraft, with a view to establishing a comprehensive private aviation network by 2015, according to Li Jiaxiang, chief executive of China’s Civil Aviation Administration. Li told the Legal Evening News that Guangdong, Guangxi and Hubei provinces would be pilot areas for the reforms, which are expected to go national within four years. However, he did not reveal whether Beijing would also engage in trials. The airspace over the capital is among the most restricted in China, often leading to the mass grounding of commercial aircraft during peak travel times. Analysts believe the reform will also trigger a boom in China’s huge untapped private aviation market similar to those in Russia and the Middle East. China’s potential market for private aviation is worth an estimated 40,000 billion yuan (US$5,882bn) in annual revenue.


Commerce Business

Video Merger China’s top two video websites, Youku and Tudou (listed on the NYSE as Yoku and on the Nasdaq as Tudo) announced a merger on March 12. The merger will result in a new company named Youku Tudou Inc., with the former holding a 71.5 percent stake and the latter 28.5 percent, and has meant that Tudou will be delisted from the Nasdaq, though it will continue its normal business operations. For years, Youku and Tudou have been involved in fierce competition to secure content, only to find neither of them could dominate the market. Both found they were pouring funds into securing the rights to the same content as their competitor, undermining their capital base as a result. Analysts predict the merger will secure a 35 percent market share for the new partners.

Market Share of Chinese Video Websites



13.7% 6.0% 6.5%

Youku Tudou Sohu iQIYI

13.3% 6.9%

PPTV Thunder Other

Source: Analysys International


Nuclear Power Programs Reinstated China will resume approving nuclear power projects within the year, revealed Wang Binghua, president of the country’s State Nuclear Power Technology Corporation, at an energy industry press conference held in Beijing March 10. China was among the first countries to halt all new nuclear projects after the Fukushima disaster on March 11, 2011. According to Wang, China launched a comprehensive safety inspection of all its existing nuclear facilities during this period, and identified a total of 14 “problems” which he pledged to resolve within three years. Wang has denied academic accusations of pushing for a “Great Leap Forward” in the nuclear industry, saying it is necessary for the mainland, including inland areas, to ease energy pressures by developing the country’s nuclear power capacity. By March 3, 2011, China had six operational nuclear plants and 13 nuclear generators with a total capacity of over 10.8 million kW. The government has pledged to increase this capacity to 40 million kW by 2020, with the intension of easing national dependence on coal.

Luxury Service Luxury brands enjoyed more than 60 percent growth in 2011 after their vigorous expansion into China’s second and third tier cities, according to a report released at the fourth Prestige Brands Forum organized by the China Europe International Business School (CEIBS) in March. China’s luxury market had an estimated value of 110.8 billion yuan (US$17.5bn) in 2011, making it the fifth-largest globally. “China is still supply driven, new store openings create new demand,” said Bruno Lannes, Partner of Bain & Company, one of the world’s leading consultancies. However, with Chinese consumers now refining their tastes in the boutiques of Paris and Dubai, luxury brands are having to up their game in terms of customer service and product quality. Lannes warned that with the rapid expansion of online media, luxury brands, many of which have been criticized by consumers for poor after-sales services, need to “proactively manage” negative media exposure in the much-coveted market.


China Mobile, China’s leading telecommunications provider, announced at the World Mobile Conference on February 28 that the company plans to commercialize its TD-LTE technology nationwide next year. Featuring high speed Internet (reportedly 10 times faster than 3G), 4G has been in development in China since 2004, and on January 18 this year, TD-LTE was authorized by the International Telecommunications Union as one of the two international 4G standards. Li Yue, president of China Mobile, told media that the company has expanded trial areas to nine cities, including Beijing, and aims to take up 30 percent of the global market share in the coming years. By the end of 2011, China was home to 128 million 3G users. However, few are truly using 3G services, which are notoriously patchy in China, according to China’s Ministry of Industry and Information Technology. 4G will have to work hard to convince consumers that their services are worth paying a premium for. NEWSCHINA I May 2012


Photos by CFP

4G to go Commercial

What’s Making China Angry?

Poll the People

Four public servants from Anhui Province were caught stealing life vests from an airliner during a tour funded by their work unit. They explained that it was their first time traveling by plane and that they wanted to take the life vests home to use in their local pool. The four women were given 10 to 15 days’ detention for their “misbehavior.”

Chi Susheng, a lawyer and a deputy to the National People’s Congress, proposed to legalize the sex industry during the annual conference in early March. Do you agree? Respondents: 43,943 by March 19 2.8%

What’s Shocking China? Villagers from Bingzhou, Shandong Province, were photographed collecting natural gas from a local oil well and taking it home. Workers at the well have attempted to dissuade villagers from engaging in this dangerous practice, but with gas prices rising, few are taking heed.

What’s Amusing China? A Wuhan administration official confiscated a line of portable gas stoves branded “iPhone Apple” apparently produced by the “Apple China Corporation Ltd.”

Who’s Moving China? A thief from Zhanjiang, Guangdong returned his spoils when he found the victim was an unemployed recent graduate. After snatching the girl’s handbag as he passed by on his motorcycle, the robber found a diploma inside it and contacted the victim with her own cell phone to tell her that “he would not like to see her future affected” before asking her to “forgive a homeless robber.” He left her belongings in a nearby trash can for her to find.



Yes 29,833 (67.9%) No 9,580 (21.8%)



Don’t care 3,280 (7.5%) None of the above 1,250 (2.8%)


Most Circulated Post Retweeted 103,605 times by March 19 A Beijing woman posted a picture of a man she claimed molested her on a bus: I was just molested by this man on the No. 715 bus, but nobody came to my aid after I spotted him. The conductor suggested I “take it easy” as I have no evidence at all. I wanted to call the police so I asked the driver to stop the bus, but other passengers started blaming me for wasting their time. The harasser was left sitting there proudly. I cried, more for the coldness of this whole busful of Chinese than for the harassment itself. NEWSCHINA I May 2012

Huang Jianxiang

W ho ’s Ho t?

Top Blogger Profile Followers: 9,831,939

Top Five Search Queries On

RoadSweeping Inventor

A road sweeper from Dangyang, Hubei Province, invented a road sweeping device with 16 brooms that can do the work of 20 laborers.

Shen Jilan, a 73-yearold woman, has never cast a “no” ballot in 58 straight years as a deputy in the National People’s Congress.

Over the week to March 19 Wang Lijun incident 2,060,739 The ongoing drama surrounding the former deputy mayor of Chongqing and his alleged attempt to seek asylum in the US consulate in Chengdu continues to grip netizens. Wen Jiabao press conference 205,380 Premier Wen Jiabao’s unusually direct comments about political reform have further raised his public profile. Youku-Tudou merger 118,970 China’s top two video sharing websites joined forces. Expired McDonald’s 34,711 A McDonald’s outlet in Beijing made national news for allegedly selling expired food, as well as food salvaged from garbage cans. Micro-blog real-name registration 24,332 All China’s millions of micro-bloggers had to register with their real names starting March 15.


Yes Woman

Flying Beggar

A 20-year-old beggar commuted between his favored cities by airplane, allegedly earning more than 1,000 yuan (US$158) on a good day.

Whale Cutters Local residents of Yancheng, Jiangsu Province butchered several beached sperm whales for food.

W ho ’s No t?

The 44-year-old is one of the best-known sports commentators in China, renowned as much for his sharp-tongued comments on current affairs as for his commentary. Huang quit his job with China Central Television (CCTV) after clashing with his employers over an incident surrounding an impassioned outburst part-way through commentary on a soccer match between Australia and Italy during the 2006 soccer World Cup, which went on for several minutes. The outburst proved a little too colorful for the taste of China’s State TV commissioners, but ensured Huang’s status as an eccentric national personality.



The Two Meetings

Chorus For Reform

In the last year of his tenure, Chinese Premier Wen Jiabao again reasserted the importance of political reform. This time, various departments of government and State media have joined the calls for real changes.

Photo by Xinhua

By Yu Xiaodong

Premier Wen Jiabao during a national press conference on March 14, 2012


n March each year, the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) convene in Beijing, in an event known as the lianghui, or “Two Meetings.” In China’s political calendar, these annual meetings are perhaps the most prominent window into discourse on government policy and its implementation. This year’s meetings attracted an unusual amount of attention as they came shortly before a reshuffle in the top leadership of the ruling Communist Party of China, with a new Politburo expected to be unveiled during the 18th National Party Congress this fall.


Traditionally, the highly charged political atmosphere during a year of leadership change tends to be very carefully airbrushed from public view, allowing the Party to present an image of calm unity, regardless of possible power struggles behind the scenes. However, observers noticed a change in the air during this year’s meetings. Voices pressing for change were getting louder from both inside and outside the Party. Even more remarkably, they seemed to be being listened to.


Standard bearer for reform, as he has been during previous congresses, was Premier

Wen Jiabao, long-time advocate of change in China’s political system. During the NPC session, Wen, in his role as Premier, delivered his final annual government work report, his most important announcement of the year. Although government work reports over the years have consistently included language seeming to push for political, economic and social reforms in one way or another, Wen chose much stronger wording for his final report, with a significant part devoted to laying out specific targets for reform in various sectors, seeming to set long-standing pledges in stone. One major change in the work report this NEWSCHINA I May 2012

Concerted Efforts

Unlike the premier’s previous calls for political reforms, this time his final work NEWSCHINA I May 2012

report has enjoyed support from various branches of government and, crucially, the State media, which has in several occasions declined to broadcast Wen’s pro-reform speeches. On February 20, two weeks prior to Premier Wen’s address, the official Xinhua News Agency published a long article commemorating the 20th anniversary of Deng Xiaop-

Photo by Xinhua

year is that the government adjusted its target GDP growth rate down to 7.5 percent, the first time GDP targets have dropped below eight percent in eight years. For a long time, a GDP growth rate of eight percent was seen as China’s paramount national policy, widely touted as an important shield against mass unemployment and social unrest, and a target to guarantee at all cost. When the global financial crisis threatened the sacred eight percent figure in 2008 and 2009, the government launched a 4-trillion yuan stimulus package to offset the impact. With the State Council adjusting this decade-old core policy, many believe that the political will to conduct broader systemic reforms is beginning to appear amongst the country’s top leadership. Traditional thinking in Party circles has it that a slower growth rate means greater social conflict and instability, and will thus increase the pressure for political reform. Premier Wen Jiabao’s 2012 work report used the word “reform” 70 times, most frequently during the recitation of a list of issues and areas in need of “deepened reforms,” ranging from the financial markets to farmers’ land rights. “While it is imperative for China to resolve the problems posed by unbalanced, discordant and unsustainable development, whose causes are institutional and structural, China is now challenged by a host of new problems such as slowing economic growth, a high rate of inflation, problematic real estate industry, potential agricultural instability, mounting employment pressures, financial difficulties faced by small and medium-sized enterprises, industrial overcapacity and sharply rising energy consumption,” reads the work report. During a high-profile press conference on March 14, the last day of the NPC session, which was broadcast twice on national TV, Wen warned that the nation risked a return to the chaos of the Cultural Revolution unless the ruling Communist Party overhauled its leadership structure and cleared the way for economic reform. “No force will be able to keep China from democratization,” Wen proclaimed.

Wen Jiabao’s high-profile press conference on March 14, 2012

ing’s Southern Tour, when China’s former paramount leader made a series of speeches defending market reforms against leftist criticism from within the Party. Deng’s strong-arm tactics in shouting down critics of economic liberalization saved his reform program and opened the way for China’s economic boom. Twenty years later, claimed the Xinhua commentary, China is facing a similar situation, with development threatened by institutional stagnation, and is therefore in need of a new, vigorous leadership to push the nation to the next level. “China’s earlier reforms have been chiefly economic. What we need now are comprehensive reforms in all four fields - economic, political, social and cultural,” reads the commentary. Three days later on February 23, CPC mouthpiece the People’s Daily weighed in with an editorial entitled “Criticism Is Better Than Crisis.” The editorial warns that vested interests have hijacked the direction of China’s reforms, and are a major reason why the national trajectory has slowed in recent years. Four days later on February 27, the Development Research Center (DRC), a government think-tank, endorsed a 468-page World Bank report entitled China 2030. Calling for change in a wide range of policies across the financial, economic and political fields, the report warns that without these reforms, it is

very likely that China could fall into what the report called a “middle income trap.”

Winds of Change

These well-orchestrated efforts to synchronize reformist action in line with a hardening of rhetoric seem rather counter-intuitive given the political culture of China, which publicly prioritizes smooth transitions in its leadership. “This administration will duly finish what it started, and will not postpone work on what needs to be done,” said Premier Wen during an earlier meeting with NPC delegates, defying the established practice that non-action is preferred during any transfer of power. Instead, Wen pledged to complete “five major tasks” within his tenure, including drawing up a roadmap for re-distribution of wealth, stipulating compensation for farmers who have had their land appropriated for development, setting up new national poverty alleviation standards, and expanding national investment in education to account for at least four percent of annual GDP. Observers believe that these concerted efforts are meant to exercise influence on the incoming leadership, which will be officially unveiled at the Chinese Communist Party’s 18th National Congress this fall. It seems that the new leaders are listening. On March 19, Li Keqiang, who is expected to succeed Wen as premier said in the China Development Forum 2012 that “China’s reform has entered the period of taking ‘fortification positions,’” echoing Wen’s earlier speech. However, no workable formula has been provided for dealing with what Wen described as “vested interests” within the system, or even revealing what, or who, these vested interests are. “Whenever a reform is proposed, someone will oppose it, and whenever a reform meets opposition, it is dropped,” remarked the People’s Daily editorial. This scenario has become a longstanding feature of China’s political culture, and the source of much hand-wringing. For the incoming leadership to genuinely further the reform agenda, its members require both the political will and the strength to take on vested interests, most prominently powerful State-owned enterprises and their executives, while struggling to uphold the status quo may yet prove too much to resist even for the most reform-minded of politicians. 


cover story


While officials, celebrities and the public decry the widespread practice of “protective demolition� of historic landmarks, few have been able to suggest a realistic alternative to a phenomenon buttressed by national development policy


Protective Demolition

Making History, History Numerous historical sites across China are being indiscriminately torn down to make way for modern high rises at the same time the government is attempting to celebrate national culture By Yuan Ye

Photo by CFP



hiang Kai-shek had a number of command headquarters and residences in Chongqing, the city which served as China’s wartime capital during the Japanese occupation of large parts of the country (1937-1945). From these often luxurious headquarters, China’s first and last generalissimo directed his troops in their campaigns against the Japanese. One of these edifices, which served as a residence for Chiang following the loss of the former capital Nanjing to the Japanese in 1937, stood neglected following the Kuomintang retreat to Taiwan in 1949. The building, designed to incorporate both traditional Chinese and fashionable Western esthetics, stood in quiet obscurity until 2008 when it was “rediscovered” during a national survey of cultural relics. By then, the building was in desperate need of repair, having for decades served as a crowded dormitory for both low-income locals and migrant workers. The building was promptly listed as a “cultural relic site under city-level protection” in 2009 amid widespread media coverage. However, surrounded on all sides by Chongqing’s forest of skyscrapers and modern apartment blocks, it wasn’t difficult for city officials to forget about this silent witness to history once again.

The 2008 national survey of cultural relics coincided with Chongqing’s campaign to “reconstruct the old city,” an ambitious undertaking aimed at relocating 460,000 residents from old and decrepit housing boasting a total floor space of 12 million square meters. The title of the campaign was somewhat deceptive. “Demand for 25 million square meters of housing will be created by this campaign,” read a contemporary report by a local real estate agency. Bystanders marveled that the city could double the capacity of the area’s housing, until they witnessed the bulldozers approaching old buildings. Every day the houses surrounding the “cultural relic site” of Chiang’s former residence were torn down. Finally in early January 2012, a cocoon of scaffolding and green safety nets had completely obscured the three-story villa. One month later, local resident Du Zhou walked past the site, and saw what had been going on behind the scaffolding. That night, a simple post appeared on Du’s microblog. “The command headquarters of Chiang Kai-shek is being pulled down,” it read, and was accompanied by a photo of the gutted building, flanked by an array of carbon-copy high rises. An arts editor working for a local magazine, Du enjoys wandering his home city in


Photo by Zou Fei/CFP

Photo by CFP

cover story

Above: The command headquarters of Chiang Kai-shek in Chongqing surrounded by modern high rises prior to its demolition Below: The Chongqing mansion of Liu Xiang, a warlord who ruled Sichuan in the 1920s and 1930s, was demolished in early 2009 and rebuilt in a nearby park

search of surprises. “I love to visit old buildings in the city. You make fresh discoveries about both them and their former residents,” Du told our reporter. However, he added, nothing had prepared him for this surprise. “We were told the building would be wellpreserved. But this is the reality. It’s unbelievable,” he said.


Local authorities, however, didn’t seem to see the contradiction in demolishing a building classed as a cultural relic. After Du’s microblog post was quickly picked up by reporters in other cities and circulated nationwide, the public outcry elicited a response from the Chongqing city government. According to Wu Hui, vice director of the Bureau of Culture, Radio, Television and Press of Chongqing’s Yuzhong District, Chiang’s field headquarters was currently “undergoing protective demolition” and would be “rebuilt according to its original form and appearance.” “Protective demolition,” the vice director


further explained, was “rebuilding demolished architecture on its original site and making the new building look identical to its original.” Unsurprisingly, the official explanation served only to further incense the public, who drew parallels with a similar case that had occurred in Beijing less than a month previously. In late January, the former Beijing residence of Liang Sicheng (1901-1972), in the capital’s Dongcheng District, was demolished overnight at the height of the Spring Festival celebrations. Liang was one of the most famous architects in 20th century China, and earned worldwide admiration for unsuccessfully opposing the Party over the issue of the demolition of Beijing’s Ming Dynasty city walls. Liang had also submitted a plan to the Politburo to preserve Beijing’s ancient city, and focus new industrial construction and housing outside the city walls. While his plan was rejected, he remains a respected figure in Chinese architectural circles. Liang’s Beijing residence was once a typi-

cal Chinese courtyard dwelling, where he and his wife lived for seven years in the 1930s, their home an informal salon for cultural icons and celebrities from all walks of life. It was unceremoniously demolished as part of a wider municipal program of “maintenance demolition,” with the officials responsible pre-emptying Chongqing’s city planner by claiming the building would be “rebuilt according to its original appearance and shape.” Netizens across the country have offered other examples of the intentional demolition of historic buildings, revealing a nationwide problem. The unofficial government program of “protective demolitions” has led to the destruction of dozens of existing historical sites and districts and their replacement with modern replicas, many of which are specifically designed for the tourist market. Larger interior spaces, gaudy decoration and photogenic landscaping are hallmarks of these “new for old” projects. Later reports revealed the “new” Chiang Kai-shek headquarters would be built 30 metres away from NEWSCHINA I May 2012


All photos by CFP except the second from above by Sun Xiaoxi

its original location, and would be “redesigned” to house a museum of the War of Resistance against Japan. “Say you have a dinosaur, a real living one. Why kill it and make it into a specimen?” Du asked our reporter. Despite the public outcry, however, the damage has already been done. In Chongqing alone, a large number of designated “cultural relic sites,” mostly dating from the Qing Dynasty (1644 – 1911) and the subsequent Republic of China era, have been torn down, “rebuilt” or requisitioned. The residence of Liu Xiang (18881938), a warlord who ruled much of Sichuan Province in the 1920s and 1930s and was another combatant in the struggle against the Japanese, was demolished in early 2009 and “rebuilt” in a nearby park, side by side with many other buildings from the same era. The mansion of Gao Zijian (1892-1961), a Sichuan educator and a high-ranking official of the Republic of China, was one such rebuilt neighbor. “In May 2010, Gao’s mansion was relocated to its current site, due to the needs of urban development,” reads the introduction board to the newly-built residence. The residence of Chen Cheng (18981965), one of the Kuomintang’s top leaders, also relocated to the park, has even become a luxury restaurant charging an average of 800 yuan (US$127) per head. According to Xinhua News Agency, a recent report from Chongqing’s Cultural Relics Bureau indicates that of the 767 historical sites in Chongqing dating from the war years, 372 have already “disappeared,” 48.5 percent of the total. Of the remaining half, nearly onethird are “in bad states of repair.” Chongqing has been at the forefront of urban expansion in China’s boom years. “Development does bring much convenience to my life,” said Du Zhou, “Yet cityscapes

Top down: Qianmen Street in the early 1900s. It has been one of Beijing’s busiest thoroughfares for centuries Reconstruction work on Qianmen Street in 2008 In April 2008, the newly rebuilt Qianmen Street opens to reporters before its official launch

everywhere have begun to look the same.” In 2007, Bo Xilai, then Party secretary of Chongqing, announced that in the following three to five years, the municipal government would invest 100 billion yuan (US$15.8bn) to “reconstruct old and dilapidated houses” in the city’s nine districts. “Construction sites are everywhere in the downtown area these days,” Wu Li, a manager of a trading company in Chongqing, told NewsChina. Wu regularly goes shopping in the city’s old quarter, but has found herself increasingly annoyed by the scale of unsightly construction sites and the accompanying noise. Wu told our reporter she has a particular hatred for flyovers, many of which have cast entire neighborhoods into perpetual shadow. “Once upon a time, these neighborhoods used to be quiet,” she said. “Old buildings are beautiful and unique. It’s meaningful to preserve them.” Du Zhou still loves to walk around the city but complains that new buildings hold few surprises. “They don’t have stories,” he said, adding that stumbling across unknown old buildings and neighborhoods on his regular expeditions is now a rarity.

Demolishing Culture

Architect Liang Sicheng was an old-school preservationist. After having failed to persuade the new government of the People’s Republic of China to preserve Beijing’s ancient city, Liang would likely have expected his own residence to suffer the same fate. The ancient city of Beijing consisted of thousands of crisscrossing alleyways known as hutong, which were lined with traditional courtyards as well as smaller, crowded areas of poor housing. The first round of major demolition of these hutongs started in the era of Reform


Photo by Li Jiangshu/Fotoe

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Photo by CFP

Hutongs and courtyards are seen as intrinsic to the fabric of Beijing’s local culture. Residents in hutongs typically favor a slower pace of lifestyle despite often primitive facilities


and Opening-up in the late 1990s, and was carried out piecemeal, carefully maneuvering around areas of historical importance. Starting in 2000, however, demolitions began picking up speed in tandem with a rampant construction boom triggered by the run-up to the Beijing Olympics. In 2005, large scale demolition of hutongs became a daily occurrence. According to a report by the Shanghaibased Xinmin Evening News, there were only some 1,200 hutongs left in Beijing by 2005, which were then being demolished at a rate of one every two days. A major casualty was the historic Qianmen area, just south of the Forbidden City, which for generations had been home to some 100,000 residents. First built in 1439 during the Ming Dynasty (1368 – 1644) around the all-important southern gatehouse of the emperor’s palace. Qianmen, literally “Front Gate,” became a focal point for Beijing’s cultural life. The streets further south prospered following the construction of the Qianmen tower, and for centuries the area remained one of Beijing’s busiest shopping areas, where hundreds of old and famous-brand stores drew visitors from across the world. In March 2005, a renovation scheme for the Qianmen area was issued by the Beijing municipal government. According to the new schematic, the north-south stretch of Qianmen Street was to be reconstructed, and parts of the hutongs behind the street were to be torn down. The scheme claimed to be designed to “restore the scenes of the 1920s and 1930s as depicted in contemporary photographs.” However, when construction was completed in time for the Olympic opening ceremonies in 2008, only nine buildings dating from the 1920s and 1930s remained on Qianmen’s main thoroughfare. 52 new buildings were constructed “according to their former appearance,” as well as seven buildings “blending historical elements and modern style.” A further seven were entirely modern. “I dare not look at those things,” said Li Yanhao, a local resident born in 1983 who grew up along the old Qianmen Main Street. Most of the old mom-and-pop stores and restaurants he knew as a child have disap-

peared since the new high rents were introduced, with the few that lingered on doubling their prices to keep pace with Starbucks and H&M. Li remarked to our reporter that he “loathes” the “artificial ambiance” of the new Qianmen, which now throngs with tourists. “Every time I walk past that main street I speed up,” he said. “And when I wade through the crowds, I wonder what on earth they are looking at.” “I would never go there,” said Zhang Na, a local freelance photographer who specializes in documentary photography of Beijing’s remaining hutongs. “Why should I visit those fake buildings?” she asked. The greatest loss in the eyes of local residents has been what Lu Yi, a 24-year-old who grew up in a hutong half a mile away from Qianmen Street, calls the area’s former “folksy culture.” “The neighbors living in the hutongs are really close to one another. It feels like one big family,” Lu told our reporter. “Beijingers value personal loyalty, which strengthens the bond between good neighbors. Money used to be a low priority. People would prefer a slow, comfortable life to a rich, busy one.” Many of Lu’s close friends in the Qianmen area have moved away since the demolition. Ordinary Chinese people, young and old, now claim that the whole of China is losing her memory. A great number of historical sites and old communities, with buildings rooted deep in the country’s turbulent history have been or are being torn down to make space for shopping malls and gaudy, faux-Western apartments. Architect Wang Shu, who in late Febuary was named the first Chinese winner of the Pritzker Prize for Architecture, made an appeal at a March press conference for the government to curtail any and all demolition of old buildings. “The Chinese seem to be gripped by amnesia,” he said. “They are turning folk culture into commercial culture,” Qianmen resident Li Yanhao told NewsChina. “My elementary school has disappeared. And my middle school is gone, too. I now feel no sense of belonging.” “You feel as if you have been deprived of certain rights. The right to maintain your memory.”  NEWSCHINA I May 2012

Protective Demolition

When Commerce Kills Culture Rapid urbanization and a national growth model prioritizing material wealth at all costs is sounding the death knell for China’s few remaining historic buildings

Photo by CFP

By Yu Xiaodong

Several nationally protected historic buildings in central Shanghai that were built in the 1920s were demolished in February 2012


hile the country may claim the world’s longest established living culture, visitors often search many of China’s modern cities in vain for any trace of this millennia-long legacy. Much of China’s architectural splendor has been lost to foreign invaders, civil war and more recently the iconoclastic Cultural Revolution. A traditional penchant for building in perishable wood also hasn’t helped. But, paradoxically, it is modern urban development, China’s other pride and joy, that is now destroying countless historic buildings and a nation’s cultural heritage alongside.

Legal Loopholes

The late Liang Sicheng (1901-1972), who famously dissuaded Allied commanders from bombing Japan’s historical capital Kyoto during WWII, failed to convince his


own country’s leaders not to destroy their capital’s ancient city wall in the 1950s. Liang has been co-opted as a figurehead for modern campaigners wishing to save China’s retreating historic areas from the developer’s wrecking ball, a position further cemented after the architect’s former Beijing residence, despite being placed on a list of “irremovable cultural relics” under the protection of the city authorities, was covertly demolished by a local real estate developer in February 2012. That same month, one of former generalissimo Chiang Kai-shek’s headquarters and residences in Chongqing was also demolished. Both buildings were leveled as part of what developers have termed “protective demolition,” a claim which has led to a considerable public outcry. The State Administration of Cultural Heritage (SACH) quickly condemned both

demolitions, pointing out that the term “protective demolition” has no grounding in law, with the agency pledging to “punish guilty parties according to the law.” However, under China’s Law on the Protection of Cultural Relics, the maximum punishment for the willful demolition of historic buildings is a 500,000 yuan (US$78,600) fine, a negligible sum in comparison to the one million yuan plus price tag of the average city center apartment in China. Although the SACH also demands that real estate developers “restore” demolished buildings, few believe the company will oblige as the SACH has no legal power of enforcement. According to preservationists, both weak government bodies and weak laws and regulations are hastening the eradication of China’s tangible history despite consistent media exposure and public condemnation of such


Photo by CFP

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Yongding Gate pictured in the early 20th Century, one of Beijing’s Ming Dynasty city walls. It was demolished in 1957

Preserve or Profit?

Photo by CFP

The new Yongding Gate, restored in 2004

projects. There’s simply nowhere for campaigners to turn. According to a SACH report, some 44,000, or 8.2 percent, of the nation’s 536,001 registered “untouchable cultural relics” had “disappeared” by the end of 2011. In Beijing, the nation’s historic and cultural capital, the ratio stood at 25 percent, with 969 of 3,840 registered cultural relics demolished in a single year. If nationally protected buildings are under threat, the situation for historic buildings not under any form of official protection is even more dire. In 2005, for example, the Beijing municipal government identified 308 former residences of important historical figures, of which only 119 were certified as cultural relics under government protection. By the end


of 2011, 97 of the unprotected residences had been demolished. It is worth noting that Beijing is seen as a city which takes the preservation of historic buildings more seriously than most, which gives some indication of how wanton the destruction of China’s architectural heritage has become. Many provinces simply have no idea how many historic buildings fall under their jurisdiction. For example, Guangdong, one of China’s most prosperous provinces, has never kept a record of its historic buildings. As a result, the provincial government is rushing out a “list of irremovable relics” which it pledged to have completed by late March 2012. All these accounts have led to concerns that the already-rampant wave of demoli-

tions cutting a swath through China’s cultural heritage may be far more extensive than even the most pessimistic of observers have suggested. According to Ruan Yisan, an expert on the preservation of historical architecture from Tongji University, China needs to legislate for the protection of historic buildings. “Currently, the law on the protection of cultural relics is the only law related to cultural conservation, and the result is no protection for buildings that do not obtain official certification,” said Ruan, “China needs to follow the example of other countries like France and the UK to universally place all historic buildings under State protection.” However, Ruan did not comment on the fact that even official protection has failed to save historic buildings from being flattened to make way for apartments or shopping malls. Critics argue that the fundamental problem is a government specifically aligned to promote economic growth over everything else. Under such a power structure, the agencies that can make money are given almost limitless power, easily stepping over agencies are net spenders, including the cultural conservation and the environmental protection departments, expensive agencies that do little to line the pockets of government. “The fundamental reason is the overall policy in urban planning that champions GDP growth and profit maximization, under which the historical and cultural value of historic buildings tends to give way to profit, leading to their destruction,” commented an editorial in the People’s Daily. As the government as a whole tends to view historic buildings as obstructing financial gains, with any cultural or esthetic value largely irrelevant, efforts designed to preserve or renovate existing historic sites are often hijacked by profiteers seeking to turn them into money-spinning tourist attractions or commercial centers. The so-called “renovation” of Shanghai’s 80-year-old Jianyeli community is a case in point. Identified as a city-level “historical and cultural zone” in 2009, the Shanghai government pledged to retain this old neighborhood’s original style and to preserve its NEWSCHINA I May 2012

“historical and cultural spirit.” Now, as the project nears completion, it is apparent that the whole community has been turned into a high-end real estate property, with its 3,000 original residents relocated, and many of its old buildings demolished and replaced with modern-style townhouses. The local government has persisted in refusing to disclose any information relating to the Jianyeli project. However, it is estimated that residential space will go on sale at 130,000 yuan per square meter (US$2,270 per square foot). The same story has been repeated time and again throughout China – if historic communities aren’t demolished outright, they are “renovated” beyond recognition, their original residents displaced to make room for China’s top earners.

New for Old

While existing historical buildings are being destroyed, many historic ruins are being rebuilt brick-for-brick. For example, the Nanjing city government has announced plans to reconstruct the Great Bao’en Temple in the city center. Once home to an immense Ming Dynasty (1368-1644) porcelain pagoda, the temple was razed to the ground during the Taiping rebellion in the mid-19th century, and has lain in ruins ever since. Now, the government and a local real estate company have sunk 8 billion yuan

(US$1.26bn) into rebuilding the ruined temple, with its landmark tower rebuilt on a far bigger scale than in its heyday. The project, according to a government press release, is designed to “commemorate Nanjing’s historical glory.” However, many locals are less than enthralled. It is no secret that the Great Bao’en Temple project is actually aimed at profiting from China’s soaring domestic tourism industry. The phenomenon of rebuilding long-lost historic sites takes its model from the reconstructed Chongsheng Temple of the ancient Nanzhao Kingdom (738-902) in present-day Yunnan. A 150 million yuan (US$23.6m) investment saw this ruined temple complex rebuilt in 2004. The attraction now generates more than 100 million yuan per year. Few tour guides take the trouble to mention that this “historic site” is built almost entirely from modern materials, making its impressive architecture in effect less than ten years old. Now, local governments across China are looking to cash in on similar schemes – reconstructing long-destroyed or ruined buildings and marketing them as originals. This could serve to make preservationists reluctant to flag up buildings threatened by urban development, for fear that they may be rebuilt as tourist traps. Shortly after the demolition of Liang Si-

cheng’s residence, the Beijing government announced on February 23 a project to “renovate 100 historical and cultural relics” and to “restore certain historical landmarks of imperial Beijing.” This announcement has alarmed historians and preservationists, disturbed at the prospect of reconstructed, photogenic replicas of the city’s Ming dynasty gatehouses and towers, most of which were destroyed during the Mao era, which gutted Beijing’s ancient city, flattened its city walls to make way for its first ring road, and even at one point threatened to demolish the Forbidden City. “Ancient buildings embody an invaluable cultural heritage. Without culture, ‘restored’ architectural landmarks are worthless piles of bricks,” said Fang Zhenning, a well-known art critic. “Instead of replicating a destroyed ancient landmark, the government should overhaul its approach to urban planning to respect China’s historical and cultural heritage,” commented architect Wang Gang. For Wang and his fellow architects, if preservation and culture continue to simply act as a front for commerce, with no value attached to historical preservation for its own sake, China’s tangible cultural heritage will simply become a Disneyfied replica of the products of a civilization that once stood as the envy of the world.



Photo by CFP

Chai is the Chinese character for “demolition.“ Whenever an old neighborhood is scheduled for demolition, authorities will paint this character on the walls to identify the buildings to be demolished. Inspiring a perplexing feeling of pain, excitement, and bewilderment, the character has gained rich political and cultural connotations in recent years, becoming a symbol for China’s rapid urbanization and the industrial-scale destruction of historic buildings.


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Protective Demolition

Wang Shu: Struggling Against Suburbia During his first press conference after being named the first Chinese winner of the Pritzker Prize for Architecture, architect Wang Shu spoke to NewsChina and other media about recycling, cultural protection and how the old ways may have always been the best By Yuan Ye



Photo by CFP



rchitect Wang Shu’s success in an the eradication of an area’s historic footprint industry famously dominated by or esthetic culture. Instead, he chooses to reforeign names has been widely at- incorporate local “memories” into his own tributed to his “stubborn” pursuit of a per- designs, fusing the past with the present. sonal vision. Distancing himself from peers However, Wang is having to search inwho put profit becreasingly hard for fore pride, Wang has the remnants of hiscreated a series of toric architecture. avant-garde projects The urbanization of redolent with both China has steamtraditional Chinese rollered over the past esthetics and modwith a thoroughness ern functionality. unprecedented in Few Chinese the country’s long architects have athistory. “The old tempted to find a should be compregenuinely workhensively protected,” able middle way said Wang during his between traditional first press conference architecture and the in China after winubiquitous skyscrapning the prize. “Not ers demanded by one historic building China’s corporations should be demoland government ished.” bodies, and it is pre- Pritzker-winning architect Wang Shu Wang Shu’s works cisely Wang’s success aim to remind ordiin offering a more nary Chinese people responsible alternaof a past that urbantive to the purely ization might othmonumental that “I wonder whether one day erwise make them has secured him the someone will suggest having forget. Wang is one Pritzker, architecof the few architects ture’s equivalent to a the Forbidden City ‘protectively working in China Nobel Prize. who believes there demolished.’ That’s the best A professor of is an alternative to architecture at the place to build a CBD, isn’t it?” the gargantuan, imChina Academy of personal architecArt (CAA) in Hangture dominating the zhou, Zhejiang, country’s skylines. Wang Shu’s portfolio “Today’s buildings includes the Ningbo are a reflection of the Museum and the architecture school of the desire for power,” said Wang. “My works are CAA’s Elephant Hill mountain campus, my resistance to all such buildings.” which utilized tiling and other materials discarded from nearby demolition sites to both What inspired you to use materials salreduce construction waste and preserve a lo- vaged from demolished old buildings? cal flavor. Wang Shu: An acquaintance from a conWhen asked about the thinking behind struction company in Ningbo told me that his recycling of waste materials, Wang re- they had found bricks from the Tang dynasty sponded: “I learned from China’s rural tradi- (618 – 907 AD) during the demolition of a tions.” Wang argues that the demolition of common residential building. I realized that condemned buildings doesn’t have to mean there was something more to this, and started


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Wang Shu’s China Academy of Art Elephant Hill campus in Hangzhou

to do research. Later I found that many traditional Chinese buildings had incorporated something which I call “recycled construction.” When you demolish an old house, you may find materials from the Tang, Song, Ming and Qing dynasties. Saving materials is a traditional Chinese virtue. Every time a house was demolished, people would recycle the old materials. Meanwhile, the poetic value of time is highly respected in traditional Chinese culture. All old materials have a very high value due to the “time” attached to them. People cherished culture through recycling. In the process of urbanization and modernization, it seems that replacing old buildings with new ones is unavoidable. What is your view on this? WS: The problem is not only to do with the speed, the “old” or the “new.” After decades of rapid development, there is too little of the “old” left in China. We can’t demolish the old anymore. In my point of view, all the old should be comprehensively protected. No more demolitions. We should have self esteem. At the very least we should treasure our own culture. Otherwise, how can we expect others to treasure and respect our culture? We often say that we Chinese lack creativity. Yet we have created this so-called “protective demolition.” That’s pretty creative! What is the relation between architecture and the environment? WS: This is one of the most important issues of all. Of all the conflicts in today’s world, the most serious and profound is between modern man-made constructions, no matter if they are cities, mines or roads, and nature. All my works touch upon this issue, and reflect my basic understanding of traditional Chinese architecture. When you look at a Chinese shanshui (mountain and water landscape) painting, you find mountains, water, trees and houses.


Many people would call the houses “architecture” and the surrounding mountains and rivers “the environment.” This is not how ancient painters understood their compositions. To them, the entire canvas was architecture. Usually the houses in the painting are small and their position is relatively indistinct. They don’t have pride of place. This is the basic ancient concept of environment. What’s more important, urban architecture or nature? When I designed the Elephant Hill campus, I preserved its natural areas. We even have some farmland on campus. The project was an exploration of how to maintain a good relationship with nature in a modern city. The Elephant Hill mountain campus is not only an architectural complex, it’s a new form of urban planning. What do you think of our modern cities such as Shanghai, Beijing and Hangzhou? WS: Shanghai is very lucky. Its dense street grid from the colonial era has been preserved. It’s still a city. It still has city streets. However, Shanghai is not China. In Shanghai, I don’t feel that I’m in China. Hangzhou is China. Frankly, I think Beijing is not a city anymore. The width of city streets should not exceed 12 meters (39 feet). Otherwise, they overstep the scale people are comfortable with. The streets in a city are for people to walk, not for cars to monopolize. Highways are not city streets. Beijing only has wide thoroughfares for transportation. The newly developed areas in Hangzhou have the same problem. Many modern cities in China have been constructed by blindfolded people. Planners lacked an understanding of what a city is meant to be, what it is for. They build wide roads everywhere, studded with supermarkets and apartment complexes. That’s not a city. It’s suburbia. I often joke that in the past decades the Chinese have worked incredibly hard to turn our cities into huge suburbs. That’s not “urbanization,” it’s “suburbanization.” NEWSCHINA I May 2012

Wang Shu’s Ningbo Museum

WS: It might be one of the most serious and profound problems that Chinese cities are facing. It’s not just an issue of the building, the space and style, of tradition or modernization, but more importantly, it concerns the existence of the original local culture. Urban residents in China have all become migrants – migrating around their home cities. Old communities formed by history have most all disintegrated. Newly-built complexes haven’t become communities. They don’t have the structure of even basic communities. I wonder whether one day someone will suggest having the Forbidden City “protectively demolished.” That’s the best place to build a CBD, isn’t it?

What is China’s traditional model for city planning? Aren’t high rises a necessity to house today’s population? WS: Take Hangzhou as an example. Hangzhou is very important in the history of Chinese city planning. It has the most beautiful model of all Chinese cities – half the city is a lake and a mountain. A city should be half natural landscape, half human construction. Such a feature was common in China, in the south and the north, in the past. The cities we used to have were so beautiful that they stood above all others in the world. Today we have lost all understanding of what a city should be like. Do we need high rises? Once, we did a calculation for Hangzhou. Basically, there would be no need for high rises if the city’s buildings were about seven to eight floors high and built comparatively densely within the local landscape. When you do the research, you realize that the issue is not about whether we need high-rises or not, it’s about human desire. High rises are a reflection of human desire, which desires taller and taller buildings, the tallest in China, the tallest in the world! That’s the desire to express power and wealth. It has nothing to do with beauty or happiness!

It is said that you give a lot of freedom to the workers building your designs. Is that true? WS: Many architects wonder how I accomplished the very complicated and irregular parts of my works, such as the external wall of the Ningbo Museum. The arrangement of the materials seems to at once follow rules, but also follow no rules. I was enlightened by traditional Chinese architecture, which taught me how to establish simple and easily understandable principles while leaving enough freedom and space for workers’ creativity. Establishing this balance is the biggest secret of Chinese traditional architecture. I follow this principle in bringing all my works to life. There are some limited preconditions which we experiment with. Then you must leave space for the free expression. The results have often astonished even me!

The demolition of old communities like Beijing’s hutongs, as well as so-called protective demolition, destroys not only buildings but also culture. What do you think of this phenomenon? NEWSCHINA I May 2012

Photo by Xinhua

Could you give us some examples of the buildings you dislike? Does your Elephant Hill project oppose a certain building? WS: I come out in goosebumps when I see those lofty, powerful, monumental buildings in China’s modern cities. I dislike them all. My Elephant Hill project was my opposition to them all. I feel my work reflects the current state of Chinese traditional culture – weakened, but in ascendance. I simply don’t believe that there is only one way for us to live.

Is this principle also suitable for the future development of cities in China? WS: Yes, indeed. And it also suits the structure of Chinese society. Chinese society in the past was based on rural autonomy, in other words, it was a laissez-faire system with a basic central structure.



Household Registration

Route to Roots Photo by CNS

The release of new central government guidelines has shed light on reform of China’s notorious household registration system. Can migrant workers sleep easier? By Yu Xiaodong A migrant family arrive at the Beijing West Railway Station on March 6, 2012


f one were to list the social management systems most desperately in need of reform, China’s hukou, or household registration system, would be a good bet to top the list. That’s why guidelines on its reform, issued by the State Council on February 23, 2012, drew wide support. While the document is far from a panacea, it can be considered the first sign of changes to what is perhaps China’s most discriminatory institution.

Urban vs. Rural

Introduced in the 1950s, the hukou system divides China’s population into urban and rural residents, tying people to specific localities. While those fortunate enough to be born into the urban category are entitled to benefits such as medical care, pensions and better educational resources in major cities, their rural counterparts who have chosen to move into the cities are left out with very limited entitlements. In recent decades, China has witnessed massive internal migration,


with millions of rural people moving into urban centers, as well as large numbers of citycity urban migrants. Given the rigidity of the hukou system, millions of migrants, both rural farmers and urban residents from other cities, are denied many benefits and public services where they live, simply because they are registered elsewhere. For example, among Beijing’s 20.2 million residents, over one-third, or 7.4 million, are not registered as local residents. Their access to a wide range of social benefits including childcare subsidies, free compulsory education, certain medical benefits and social security are limited. More recently, a migrants’ right to apply for local vehicle registration and to own local real estate in Beijing has been further tightened to include only those who who have paid local taxes for more than five years. According to official data, 16.5 percent of China’s total population, or 221 million people, are living away from where they are

registered. It is estimated that 300 million rural people will become urban residents in the next 30 years. Efforts have been made, mostly in small cities, to loosen up the system in various localities. The results have been mixed. The central government guidelines, entitled Notice on Pushing Forward Household Registration Reform in an Active and Steady Way, is the first national policy document to feature concrete measures, providing a roadmap for the future of the hukou system. The guidelines adopt a graded approach. For example, different solutions are prescribed for cities of different sizes. For smaller county-level cities which offer minimal public services, migrants who have a stable job and own or rent a local house are allowed to relocate their household registration to become local urban residents, along with their spouses, children and parents. For midsized, prefecture-level cities, migrants and their families will be allowed to relocate their NEWSCHINA I May 2012

household registration to become urban residents after working there for three years. For big cities, the most attractive destinations, the guideline upholds the current policies with regard to hukou management, to keep the already huge populations from exploding further. To many, the guideline is more an endorsement of existing local practices in small and mid-sized cities rather than a policy breakthrough. Small cities have been loosening their household registration management systems for years. Moreover, the guidelines went into effect over one year ago on February 23, 2011. Analysts have speculated that the State Council was simply biding its time to publicize the guidelines, publishing them one day before the World Bank released its report China 2030, which set out a wide range of policy suggestions, including abolition of the hukou system.

Small Cities

However, the guidelines do act against certain practices, mostly regarding government appropriation of rural land owned by migrants who are allowed to re-register their residence in urban areas. According to experts and activists, local reforms of the hukou system are often economically driven, targeted at obtaining rural land from migrants for real estate development, rather than bettering the migrants’ wellbeing. For example, in Shaanxi Province, a prerequisite to enjoying urban benefits is that migrants give up their family farms. In Chongqing, a scheme of “rural housing for urban apartments” has been introduced, under which migrants are offered urban residences in exchange for their, usually much larger, rural homesteads. “Now that various stimulus packages for real estate development and subsidies for electronic appliances have gone some length toward spurring economic growth, turning rural people into urban residents is now considered an effective way to stimulate the economy,” Professor Wang Taiyuan from the Chinese People’s Public Security University told NewsChina. The new guidelines stipulate that when relocating their household registration to urban areas, migrants’ rural housing, farmland, woods and grazing land may not be taken


forcefully by local governments. While many welcome this clause, others warn that it is impossible to uphold without financial support from the central government. Local governments have long argued that they need additional revenue sources, such as rural land acquisition, to cope with the increasing burden on social services incurred by new migrants-turned-urban residents. Moreover, these practices are in accordance with China’s land law, which prohibits residents with urban household registration from owning rural land. “Reform of the hukou system will only be possible through synchronized and well orchestrated efforts by both central and local governments, along with various functional departments,” Professor Wang Taiyuan told NewsChina. “It would be unrealistic to expect local governments to implement in all seriousness a guideline that goes beyond their financial resources.”

Big Cities

Such a lack of synchronization is also crippling reforms in big cities, which would require the coordination of more than a dozen government agencies and substantial financial input from either the central or city government. However, given the conflicting interests of different departments and localities, as well as a fear that the social welfare system in big cities may be overwhelmed, the central government has been reluctant to streamline the responsibilities of all relevant departments. Instead, it has adopted a gradual approach. Instead of an overall reform of the hukou system, the guidelines urge big cities to introduce a “residence permit” to replace the much-criticized “temporary residence permit.” More than a dozen big cities, including Shanghai and Shenzhen, have already made this switch. However, the new residence permit actually appears to be little more than a nominal change. For example, while the residence permit in Shijiazhuang, Hebei Province, a city with one of the most liberal hukou policies nationwide, grants migrants entitlement to free medical checkups, and allows them to apply for the right to buy an apartment under the Affordable Housing Program, it shows little progress in more ur-

gent areas such as education, housing subsidies and social security. “If the residence permit is not linked to the distribution of social resources, it is no different from the temporary residence permit,” said Professor Wang Taiyuan. “What people really care about is not so much where their household is registered, but whether they have access to local public services and various kinds of benefits.” The central government has been pushing individual departments to launch incremental reforms in their respective fields. For example, in 2009, social security authorities launched a scheme to allow migrants to transfer their social security funds between different cities following their migration, but again, results have been mixed. In early March, shortly after the release of the guidelines, the Ministry of Education announced that it would require provincial education departments to establish programs that allow high school graduates from migrant families to take college entrance examinations in cities where they attend high school and where their parents work. Under the current policy, students can only take these exams where their hukou is registered, even if they are enrolled in high schools elsewhere. In China, minimum exam scores required for college entry vary widely between provinces, and those in huge metropolises like Beijing and Shanghai are drastically lower than in remote rural regions, meaning that for students from big cities, the path to higher education is considerably smoother than for their rural peers. On March 1, Shandong Province announced that high-school graduates from migrant families were allowed to take the college entrance examination locally, the first province to do so. However, with the province’s minimum required score for college credit among the country’s highest, this announcement can hardly be considered a breakthrough. While celebrations over the new guidelines are perhaps premature, the document at least shows that this urgent issue is not being ignored. However, given the lengthy process of finding common ground between vested interests within the social system, as well as conflicting local and central interests, any real breakthrough is likely to come slowly.



Hepatitis C

A Chronic Problem While China’s public health battle with a hepatitis B epidemic continues to receive wide publicity, the lesser-known strain of viral hepatitis C is quietly taking its toll By Wang Yan


ate February, over 200 people were diagnosed with hepatitis C (HCV) infection in Zijin, a town in south China’s Guangdong Province. Last November, a similar outbreak was reported in Woyang, Anhui Province, with 76 infections in a one small town. The two separate cases, though occurring some 1,000 kilometers apart, had one thing in common: the infection was transmitted in hospitals.

Photo by Liu Liting/CFP


A mother weeps after her child is diagnosed with HCV after receiving an injection with an unsterilized needle in Woyang in late 2011. The high cost of HCV treatment places a heavy burden on poor local farmers.


HCV is a blood-borne pathogen first identified in 1989. Most new infections worldwide occur through unsterile medical procedures, blood transfusions, unprotected sex and mother-child transmission during pregnancy or breastfeeding. Left untreated, HCV infection can lead to cirrhosis of the liver and some liver cancers which can ultimately prove fatal. After conducting initial research, the Guangdong Provincial Health Bureau made an announcement February 27 that ruled out intravenous drug use, blood donation, blood screening and other factors as the root cause for the Zilin outbreak. On March 2, a follow-up announcement traced the infections to a single town clinic – the Chengdong Health Center – which was found to have re-used hypodermic needles. However, Zhuang Hui, from the Peking University Health Science Center, told NewsChina during a recent interview: “These were not new infections. As far as I could ascertain from local doctors, most of NEWSCHINA I May 2012

the patients had been known to be HCV-positive for several years.” which can easily be spread by casual contact, hepatitis C has never According to Professor Zhuang, the indefinite incubation period been a priority of China’s health policy. According to the latest ofof hepatitis C, ranging from six months to years, ficial statistics, there are some 93 million people means that symptoms in infected people are slow infected with HBV in China, accounting for 27 to appear, meaning that most newly-infected papercent of the global total of 350 million. Ac“In many remote areas, tients are unaware they have the disease. cording to Professor Zhuang Hui, the figure of A 2010 report issued by World Hepatitis Al- unsafe medical procedures domestic HBV carriers used to be 120 million in liance (WHA) states, “Globally, 57 percent of are still fairly widespread, 2006. “The percentage of HBV carriers among cirrhosis and 78 percent of primary liver cancers the total national population has dropped from are attributed to hepatitis B and C infections. a situation that has 9.75 percent to 7.18 percent over the past five Hepatitis B causes 30 percent of cirrhosis and years,” said Zhuang to the reporter. remained basically 53 percent of primary liver cancers, and hepatitis The Ministry of Health initiated a nationwide C 27 percent of cirrhosis and 25 percent of pri- unchanged since the HBV immunization program in 1992, and all mary liver cancers.” newly-born babies are required to be vaccinated. 1950s.” Starting June 1, 2005, the vaccine became free of HCV in China charge for infants. This was followed up in 2009 A total of 120 million to 170 million people by a nationwide routine immunization program are infected with HCV worldwide. Egypt and for people under the age of 15. Mongolia have the highest prevalence rates Rising awareness of hepatitis B has led to an (around 10 percent -20 percent of the total increased voluntary testing for the disease in the population). In China, it is estimated that over past decade. In addition, pre-school and pre10 million people, alittle less than one percent employment blood tests have begun to include of the country’s total population, are hepatitis C carriers, down from routine screenings for hepatitis B. However, testing for hepatitis C 40 million in 2006. remains rare, with less than 50 percent of the population likely to “Blood transfusions were until recently a significant route of trans- be given the option to be tested in their lifetime. Professor Zhuang mission, and unhygienic vaccinations and needle sharing are current- told our reporter that some county-level hospitals even lack the equiply the main cause of new HCV infections,” Professor Zhuang told ment to conduct HCV testing. “The general public’s high awareness NewsChina. A lack of sterilizing equipment and a constrained supply of HBV, plus the national immunization program has made HBV of syringes in poor rural clinics are a major contributor to the ongoing much more preventable than HCV,” he said. prevalence of HCV in China, and the authorities also point to needle A hepatitis B vaccine has existed for almost 30 years, but no hepasharing among intravenous drug users as another factor. titis C vaccine currently exists, partly due to the virus’ high viability, Field research conducted by Zhuang and his team found that large similar to that of HIV, making the virus hardy enough to survive outnumbers of rural people in Hebei and three northeastern provinces side the body for days, even weeks. Interferon and ribavirin are the of Liaoning, Jilin and Heilongjiang were infected with HCV due to main treatments for HCV infection, with 70-80 percent of patients injections which were not medically necessary. going on to make a full recovery. “In the 1980s and 1990s, farmers in these northeastern provinces In 1993, blood donors in China were screened for HCV for injected themselves with animal tranquilizers to attain temporary the first time, a measure which has substantively reduced the cases highs,” Zhuang told our reporter. “Imagine how unsafe these self- of infection via blood transfusions. However, public awareness of administered, non-sterile injections were.” the virus remains low. Research done by the Centers for Disease In southern China, especially in the coastal regions, consumers Control and Prevention (CDC) indicates that 41 percent of the keen to get their money’s worth often submit themselves to injec- Chinese population is unaware of the existence of HCV, with only tions in unlicensed drugstores and local clinics, typically conducted 6 percent having any rudimentary knowledge of preventative meain unsanitary conditions. In a telephone interview with NewsChina, sures. Ding-Shinn Chen, professor at the National Taiwan University ColThe use of unsterilized needles remains widespread in China’s rural lege of Medicine and chair of the Coalition to Eradicate Viral Hep- hinterland, with many clinics lacking the resources to sterilize equipatitis in Asia Pacific (CEVHAP), told our reporter that hepatitis C ment. Zhou Kuiqing, vice director of project management at the Chiis also a problem in Taiwan’s rural areas. “In southeastern Taiwan, a nese Red Cross Foundation, said in a recent TV interview: “As far as region similar to coastal regions on the Chinese mainland, fishermen we know, in many remote areas, unsafe medical procedures are still often accept saline drips or pure vitamin injections to recover quickly fairly widespread, a situation that has remained basically unchanged from exhaustion, he said. “Without adequate sterilization procedures, since the 1950s.” HCV spreads quickly through entire villages.” According to statistics released by China National Training Center for Rural Doctors, of 1.05 million people serving in medInsufficient Measures ical institutions in 600,000 villages across China, less than 20 Compared with its more virulent counterpart hepatitis B (HBV), percent are professionally qualified. NEWSCHINA I May 2012


Photo by CFP


Animal Rights

Too Much to Bear Traditional Chinese medicine giant Guizhentang’s application to be listed on the stock market has led to an outcry from animal rights activists over the company’s support for moon bear farming By Xie Ying and Xu Zhihui




Photo by CFP

uizhentang, based in bears. “Once the incision becomes Fujian Province, is one infected, the bear will definitely of the world’s largest die,” he said. manufacturers of traditional ChiAAF director Zhang Xiaohai told nese medicine (TCM). This vast NewsChina his organization has rescompany has come under fire for cued several hundred bears from the controversial use of bear bile, factory farms after witnessing the obtained from live moon bears, animals chewing their own paws in its products. China’s burgeonand banging their heads against the ing animal rights movement has cages. There have even been docuspearheaded attacks on the commented cases of moon bears comGuizhentang shows reporters their “painless” extraction procedure, pany since Guizhentang began to mitting suicide, either by refusing February 22, 2012 move toward a public listing. food or by intentionally braining The Ta Foundation, China’s first themselves. animal protection organization, wrote a letter to China’s Security RegulaEven the CATCM has acknowledged the “cruelty” of some forms of tory Commission, warning that to allow Guizhentang to go public would bear bile extraction, but emphasized that the techniques depicted in conbe to formally approve animal torture. The letter was cosigned by 72 ani- troversial Internet videos had been prohibited since 1990. At a press confermal rights activists and celebrities. ence called in response to the AAF allegations, Fang Shuting detailed the The Ta Foundation’s move was met with widespread support from latest “free drip” technique: a thin, compressed tube is inserted into the bear other animal protection organizations, leading to a public exposé of the and enlarges within the body. This form of extraction reportedly takes 10 extraction techniques involved in the bear bile trade at a press conference in seconds, after which the tube is “painlessly removed.” Beijing organized by the Animals Asia Foundation (AAF), a Hong Kong“The bears feel nothing, and they can even play during the procedure,” based animal protection organization. Fang said. “No matter what technique is applied, the bears suffer severe infections Fang’s claims resulted in a furious rebuttal from AAF, who insisted that in their bones, spinal cords and teeth, not to mention experiencing severe even “painless techniques” cannot prevent infection. According to AAF, distress,” AAF’s foreign affairs director Zhang Xiaohai told reporters. nearly 100 percent of the 181 bears they have rescued from painless extracThe China Association of Traditional Chinese Medicine (CATCM), tion were suffering from severe gall bladder infections, many of them fatal. which has for years been under scrutiny for their approval of the use of animal parts in certain medicines, quickly denied that Guizhentang’s meth- Ban ods were cruel. “We have adopted painless ‘free drip’ techniques which are The AAF has been calling for an Asia-wide ban on moon bear farming harmless, and even enjoyable to bears,” said director Fang Shuting, com- since the 1990s. Vietnam ended the practice in 2002, and South Korea anments swiftly derided by the AAF and Internet users. nounced its own ban in January 2012. China, homeland of TCM, has resisted following suit, but has made Painful some concessions to animal rights The extraction of bear bile was groups, signing an agreement with not a prominent issue for animal the AAF in 2000 to relocate 500 rights activists in China until grueendangered bears to a rescue center some footage of the extraction techin Chengdu, Sichuan. niques was released online. Netizens China’s Forestry Ministry, the witnessed captive bears strapped government body in charge of wild down in tiny “crush cages,” wearanimal protection in China, has ing iron vests to prevent movement, refused to comment on the potenwhile yellow bile from their gall tial introduction of specific animal bladders flowed through a tube inrights legislation. The CATCM serted directly into their abdomen. even accused “Western groups” of Introduced from North Korea in attempting to “cripple TCM’s comthe 1980s, bile extraction, accordpetiveness in the global market,” Animal rights activists protest against bile extraction outside a branch ing to Zhou Ronghan, a medical despite the fact that the majority of Guizhentang, February 27, 2012 professor of China Pharmaceutiof opposition to the use of bear bile cal University, is very dangerous to has originated within China. NEWSCHINA I May 2012



Photo by CFP

China that since the introduction “Bear bile has been used in 150 of farmed bear bile, demand for its medicines for 2000 years, and remore valuable alternative - wild bear mains irreplaceable,” Lang Guanzi, bile - has in fact risen. a TCM expert working for China’s Moon bears are classed as Catbiggest TCM retailer Tongrentang, egory Two animals according to told NewsChina. China’s wild animal protection However, the active ingredient laws, meaning they are legally appresent in bear bile, ursudeoxyproved for “reasonable developholic acid (UDCA), has long been ment and use.” Legal expert He obtainable from slaughterhouses, Hairen of the China Academy of with pharmaceutical-grade UDCA Social Sciences believes any animal approved for use in medicine by protection law that explicitly apthe USFDA. The Chinese governproves the domestication of wild ment, under pressure from domesanimals is paradoxical. tic TCM lobby groups, has contin“’Development’ in this case, ued to drag its feet in developing should mean actual protection, alternative sources despite having not factory farming,” he told Newsapproved a program to develop efChina. fective substitutes in 1983. Since launching clinical trials of humane herbal and animal substitutes for Humans vs. Animals As China has continued to bear bile in 1992, the Ministry of open its markets to the world, Health has resisted approving alteranimal protection has become natively sourced UDCA for human a major barrier to the export of consumption. Over 1000 dogs in a truck bound from Chongqing to a Guangzhou domestically manufactured con“Generally speaking, a new drug slaughterhouse were freed by activists on January 16, 2012 sumer goods. The US governwill be approved after the second ment, for example, has banned phase of clinical trials,” Gao Yimin, imports of shrimp products from a researcher of alternative sources of UDCA, told NewsChina. “It is rather perplexing why ‘artificial’ bile is an China since 1995 after discovering that Chinese shrimp fishing vessels used nets that regularly ensnared endangered sea turtles. The EU has exception.” also banned imports of many Chinese-made cosmetics after shocking evidence of cruel animal testing was revealed in the media. In 2009, Protectionism Some believe the reluctance of the Chinese government to recognize more than 10,000 Swiss signed a joint letter calling on the Chinese internationally-approved, humane substitutes for bear bile is due to the government to stop permitting the slaughter of St Bernard dogs for lucrative bear farming trade. According to the CATCM, 183 TCM en- food. With more widespread exposure to photographs and footage of animal terprises in China, some of which earn hundreds of millions of dollars in cruelty in the domestic media, and with pet ownership at a record high, profit a year, are reliant on bear bile extraction. Kaibao Pharma, another major user of bear bile, revealed to the media members of the Chinese public have also joined the crusade for animal that sales of a serum made from bear bile earned the company 800 million rights. Celebrities such as Yao Ming and Jackie Chan have appeared in prime-time TV commercials speaking out against the continued use of yuan (US$126m) in sales revenue last year alone. With the introduction of bans on bear farming in some other Asian controversial ingredients such as shark’s fin and tiger parts in both food countries, China’s TCM enterprises have benefited from an ever-increasing and medicine. slice of the international market share, supplying TCM manufacturers and In June 2011, over 200 animal rights activists intercepted a truck conclinics across the world. taining 500 dogs bound for a Harbin slaughterhouse, leading to a tense There are an estimated 20,000 moon bears living on around 70 licensed standoff between activists and supporters of the dog meat trade. While farms in China. Farmers argue that a government ban would simply lead activists freed the animals and dispatched them to veterinary clinics for to the resumption of wild bear hunting to satisfy market demand for their treatment, others distributed free dog meat to the truck drivers and their bile. “Bear farming is the best way to protect wild bears. Given the market supporters. demand, how could we prevent wild bear hunting?” argued Fang Shuting “These well-fed young people just view animal protection as a fashion,” at the CATCM press conference in February. This contradicts an Oxford Yin Baojun, one of the truck drivers told NewsChina. “But we might lose University report, according to veterinarian Sun Quanhui, who told News- our jobs because of this ‘rescue.’”



Welfare or Rights

Animal rights groups argue that what China needs is a universal animal protection law. While laws exist for the protection of wild animals, with penalties for violators ranging from hefty fines to life imprisonment or even the death penalty, the factory farming of formerly wild animals remains legal. A putative animal protection law drafted three years ago still remains mired in debate. Zheng Chu, a Beijing-based journalist, is one of the many activists fighting the legislation. “The point is not protection, but to define which animals deserve protection, and in what circumstances,” he told NewsChina. “I don’t think animal protection organizations have the right to stop Guizhentang extracting bear bile, since the captive bears are the company’s property – people have the right to dispose of any animal they own, in whatever way they see fit,” he said. “For example, people should be able to maltreat their pets in their own homes, as long as their behavior does not disturb or offend other people,” he added. “Animals cannot be subject to any laws. What lawmakers seem to be considering is people’s affection for animals, how much they love them.” Such ideas are met with howls of outrage from China’s growing legions of animal lovers. The Chinese mainland remains the only Chinese territory that has yet to introduce animal protection legislation, or even define


to which creatures such legislation should apply. In contrast, under Hong Kong law, animal cruelty is classed as any injury or torture unnecessarily inflicted on “any mammal, bird, insect, fish or invertebrate,” while Taiwanese law extends protection to “dogs, cats and other pets or farm animals.” Chang Jiwen, the man behind the drafting of China’s first attempt at an animal protection law has repeatedly emphasized that the law focuses on animal welfare, not animal rights, and is simply aimed at stopping unnecessary cruelty, not offering animals legal status comparable to that of human beings. Critics, led by the TCM and food industries, have responded by challenging legislators to classify “cruelty.” Legislators consequently struggle to appease an increasingly angry public as well as the wealthy and powerful industries that profit from animal products. When Chang Jiwen’s group began drafting the animal protection law in 2009, he revealed to the media that they were working on two versions of the law, with one focusing on eliminating animal cruelty while the other focused more generally on animal welfare. “I think the former will be approved in two to three years, with the latter having to wait five to 10 years, or even longer,” he said. Three years have passed, and neither law has progressed beyond the draft stage. When NewsChina attempted to contact Chang Jiwen for comment on the bear bile case, he refused to be interviewed, telling our reporter: “It is not the right time to talk about this issue.”



Educational Disparity

The Great Divide With education low on the central government’s list of budgetary priorities, China’s urban-rural literacy gap shows no sign of narrowing By Chen Wei and Pang Qinghui




heard of the popular boy wizard. According to the National Education Spending Statistics for 2010, issued by the Ministry of Education, the annual public funding available to elementary school students in Beijing was 5836.99 yuan (US$925) per student, more than 10 times the 579.26 yuan

(US$91.8) earmarked for each elementary school student in impoverished Guizhou Province. Critics argue that the Ministry of Education is focusing most of its resources on the children who need it the least. In his government work report delivered to the Fifth Plenary Session of the 11th National People’s Congress on March 5, Premier Wen Jiabao announced that the central government was working on the 2012 fiscal budget, in which educational spending would comprise four percent of national GDP. This four percent target for education spending was first pledged in the central government’s 1993 budget, and was supposed to be met by the year 2000. While defense and internal policing have enjoyed exponential increases in funding, education has remained a low priority, with the central government preferring to delegate responsibility to provincial authorities, most of which prefer to boost GDP growth, a major factor in determining promotion for provincial officials, rather than the literacy rate, which isn’t.

Photo by Getty Images

If I were Harry Potter…” begins a third-grade composition exercise used by a Beijing elementary school. With urban students increasingly cosmopolitan in their reading material and outlook, city schoolteachers in China are constantly having to adapt to the fast pace of cultural change in the country’s affluent metropolises. Their rural peers, however, struggle to impart even a basic level of learning to their students, few of whom are likely to have



Photo by Zhen Hongge

“Less than five percent of elementary school teachers in underdeveloped western regions have had a college education.”

Photo by Zhuang Yixie/CFP

A volunteer teacher leads her class in Dasi Middle School, Lincang, Yunnan

A classroom in Gaoyuan Primary School in Enshi, Hubei Province

Widening Disparity on Education Spending (unit: yuan) 20000 16143.85 15000

13016.14 7940.77

10000 5340.96 5000

12.21 0


448.2 796.77




1256.66 2005



Comparison of annual per capita education budget for elementary school students in wealthy Shanghai (red) and impoverished Shanxi (blue) Source: Ministry of Education


Poor Schooling

Apart from doing chores like feeding pigs, picking walnuts and plucking tea leaves, Shi Fuping, 13, a middle school student in the mountainous Dasi village of Lincang city, Yunnan Province, is fond of watching TV in his spare time. His favorite program is the weather forecast, which he closely follows to learn the names of unfamiliar cities. Shi’s parents work in urban areas of neighboring Guizhou Province, along with most of his classmates’ parents. His mother calls him once a week on the telephone in his grandparents’ rickety wooden house, where he lives for most of the year. The Shi family property includes a half acre of pasture, four pigs and a donkey. Shi has never crossed the mountains that encircle his hometown. Despite being in first grade, he still cannot write the Chinese characters for “grandma” correctly. “I want to continue my schooling, but I’m not doing well,” Shi told our reporter. His grades are poor, even by village standards, which means that his chances of making it to college are virtually zero. Of the 53 students in his class, according to Shi, almost half of them expect to drop out after completing junior middle school. Dropout rates remain high in China’s rural regions, with most students pulled out of school by parents in need of their labor. For example, of the 216 students who enrolled in Mengtong Middle School in Mali County, Yunnan in 2006, only 77 were still in school by the end of 2009. The percentage of rural students who finally enter the college is also in decline. Peking University’s recruitment records suggest that between the early 1960s and mid-1980s, the recruitment of rural students hit a record high, with the percentage amounting to 40 percent. In the mid-1990s, however, the figure began to drop, hovering around 10-15 percent at the turn of the century and falling further to 9.8 percent in 2010. “Knowledge Changes Life, Hope Lies Ahead,” reads the banner above the blackboard in Shi Pingfu’s classroom. Shi, and most of his classmates, can’t read it. NEWSCHINA I May 2012



China’s Teachers’ Law, enacted in 1993, clearly states that “teachers’ salaries should not be lower than those of other public servants.” Twenty-five years ago, Gao Qingyu’s monthly pay was 100 yuan, 20 yuan more than that of the average public servant. Today, the average monthly salary of a teacher in Fengqing County is 2,000 yuan (US$317), way below the salary of the average local public servant, and even lower than that of a migrant laborer in a big city. In 2009, an investigation carried out among 360,000 middle and primary school teachers in Shaanxi Province showed that 73 percent of junior middle school teachers in urban areas had college diplomas, but the figure was only 42.19 percent in rural areas, a difference of 31 percent. Photo by Zhen Hongge

According to the National Regulations for Implementation of the Compulsory Education Law which was issued by the State Council, China’s cabinet in 1986, township and village-level authorities are responsible for the construction, renovation and expansion of public schools in their areas of jurisdiction. If these places are too poor to bear the financial burden, county governments are obliged to provide aid. However, these regulations are rarely enacted at the local level, largely because it falls to county governments, the people who must sigh the checks, to enforce them. Statistical analysis of the disparity in education spending between urban and rural areas produces some alarming figures. In 2000, each elementary school student in Shanxi Province was allocated 17.71 yuan (US$2.8) from the provincial education budget. Their Shanghai counterparts were allocated 448.2 yuan (US$71), 25 times more. In May 2001, the State Council issued the Decision on Basic Education Reform and Development, which stipulated that the primary responsibility for compulsory education policy rested with county governments, in turn overseen by provincial and central authorities. It went on to state that rural compulsory education was to be financed by a system of public-finance guarantees, with both national and local-level finance bureaus contributing to funding. The white paper initially led to a boom in funding for rural education, relieving many school principals of the burden of scraping together a school budget by going panhandling to public officials. “For our school, this was a real solution that tackled the problem of funding at the root,” said Zheng Huamin, a school principal in Shilou County, Shanxi, who had had to beg for funding from the local authority merely to keep his school open. The benefits were also felt by Gao Qingyu, the current director of the Education Bureau of Fengqing County, Yunnan. In 1985, fresh from school himself, Gao went to teach in a Fengqing elementary school. Without sufficient salary to rent his own house, Gao had to sleep in his classroom, improvising a bed from bamboo poles. In 2007, however, over

Chen Tao, a student at Dasi Middle School struggles to recite a poem

50 million yuan (US$7.9m) in school construction and renovation funds was allocated to his county.

Losing Ground

The injection of capital into education allowed many rural schools to survive into 2012. However, educators like Gao Qingyu remain less than optimistic about rural education drawing level with the schooling available in China’s increasingly affluent cities. As more funding has trickled down to the provinces, the cities have seen a torrent of spending on education, allowing urban youngsters to pull even further away from their rural peers. In 2010, the average primary school student in Shanxi Province was allocated 4049.34 yuan (US$642) per year. In Shanghai, the figure had surged to 16,143.85 yuan (US$2,558). “We are driving tractors on dirt tracks, while they are driving automobiles on expressways. How can we narrow such a gap? It is impossible.” Gao Qingyu told our reporter, banging his fist on his desk.

Increase the Flow

“Less than five percent of elementary school teachers in underdeveloped western regions have had a college education,” said Liu Zepeng, a member of the National Committee of the Chinese People’s Political Consultative Conference, in an interview with NewsChina. “Despite government support and newly constructed school buildings, the hidden reality is primary or middle schools in poor rural areas cannot attract highly qualified teachers,” Liu added. “I went to college in the 1960s and many of my classmates came from rural regions.,” Liu continued. “But things have changed. While nine-year compulsory education has been promoted, and higher education has made great headway, the disparity between urban and rural education has been widening.” In recent years, an increasing number of college graduates, retired teachers and foreign volunteers are going to rural areas to work as volunteer “barefoot” teachers. This wave of voluntary teaching has supplemented educational resources in rural regions, but critics like Liu argue that this reliance on charity is not sustainable in the long term. “Voluntary teaching is a tributary of the great river of resources that the government should provide,” said Liu. “The solution lies in the importance attached to the issue by the government.” 



Educational Videos

Know Your Rights A series of viral videos that educate Chinese people on their basic legal and fiscal rights aim to expose a lack of “basic knowledge” By Li Jia and Wang Chen

Zhao Jiaxu (Right) and his colleague Gao Ning in their studio in Beijing, March 9, 2012

These are the thrillers of the year!” read famous Chinese film director Lu Chuan’s review of a series of five-minute web videos on issues including inflation and taxation in China. The short animations, with titles like Everyone is a Taxpayer and Where Do Our Tax Payments Go?, went viral when they were posted online last year. Videos about such mundane subjects as the taxation system may seem unlikely to cause a stir on the Internet, but to many Chinese people, who have very little knowledge about the basic systems on which the country runs, they were a goldmine of vital and sometimes shocking information. Dressed up with flashy manga-style graphics and references to ancient Chinese literature, the series has become a must-watch. Main Media, the firm that produced the films, is a very small company founded in 2009 by graduate Zhao Jiaxu, now in his mid-twenties. The firm has only three full-time employees, including Zhao himself. While he has admitted that his goal was at least partly to drum up support for his struggling start-up, Zhao believes the success of the videos has exposed a much wider issue: the urgent need to propagate basic knowledge about the way China’s social systems work.



In July 2011, when China’s consumer price index hit a 37-month high, the three-letter abbreviation “CPI” was splashed across media headlines almost every day. After a bout of intense research and an in-depth discussion on the subject with a friend in the financial sector, Zhao was still confused. But he also sensed opportunity. He figured that, in the microblog era, a clear, concise explanation of the topic could potentially be very popular. Two months later, his video Who Moved Our CPI? was published on Main’s microblog feed. In just one day, the video was re-tweeted more than 2,000 times, and the company’s microblog followers soared from a few hundred to more than 4,000. In just under five minutes, the video explains the concept of CPI with the example of a bank deposit whose face value doubles over 30 years, but whose real value drops drastically, going from a family’s entire yearly expenditure to less than the cost of a single dinner. Comments left on the video speak for themselves, with the majority of viewers elated that they finally understand the popular buzzword. With its next two videos, both about China’s taxation system, the company set its sights not only on jargon-busting, but also on filling what they percevied to be a vacuum of knowledge about the rights of NEWSCHINA I May 2012

a comment on Where Do Our Tax Payments Go? Continuing in the vein of rights education, Main’s latest video is about controversial revisions to China’s Criminal Procedure Law, which, among other things, legalize secret detentions. The video uses a “rock-paper-scissors” metaphor to explain the power that public authorities wield over the rights of the individual.

Fog of Information

Photo by Zhen Hongge

In China, the issues of tax, public spending and the legal rights of the individual have taken center stage in public debate over recent years, and attempts to popularize basic information about them have been welcomed by the public. In 2008, a brochure on the rights of the taxpayer issued by the Transition Institution, a Beijing-based NGO, attracted hundreds of thousands of readers. For organizations like Transition and Main, the challenge is to explain these incredibly complex issues to people who have no academic background in such areas, up to a level at which they are able to engage in informed debate. Expert knowledge is not the only barrier to progress, however, as even academics claim to have difficulty understanding the inner workings of government operations. Professor Jiang Hong from Shanghai University of Finance and Economics, a member of the Chinese People’s Political Consultative Conference (CPPCC), China’s advisory body, has refused to vote to approve local or even national budget reports for the last ten years. He has told the media that delegates have not once been given sufficient time or information to give the reports a proper appraisal. For example, budget figures in the category of “infrastructure” can include the “I hope we can clear construction of rural school buildings as well away the fog surrounding as shiny new local government offices. Main’s video shows that these offices often cover an the individual in society. information, and make area eight times that of the White House. Zhao saw on the news that the Wangfujing more people understand The root cause for public ignorance seems to bookstore, one of Beijing’s largest, used to list lie in a lack of basic education, and pervasive clearly the amount of tax on books, a common their own rights” manipulation of the public’s perception of cerpractice in many countries. Lacking a basic untain issues. In terms of taxpayers’ rights, for exderstanding of the tax system, however, Chiample, the declaration that “paying taxes is the nese consumers erroneously accused the store obligation of every citizen” is an all-too-familiar of lumping them with tax costs the store itself propaganda slogan, but little is ever mentioned should have been paying. The bookstore soon about the rights of taxpayers. Similarly, most stopped displaying the information. Once again, Zhao hit the books, eventuChinese people’s awareness of criminal susally producing two new videos, Everyone is a pects’ “right to remain silent” comes from imTaxpayer and Where Do Our Tax Payments Go?, ported movies and TV shows. showing viewers how tax is calculated on everything from an apartThe explosive popularity of Zhao Jiaxu’s videos is evidence that the ment to beer. So far, the company has reached more than 50,000 demand for “basic knowledge” is increasing in China. Thanks in part microblog followers, and its videos, which directly criticize the opacity to public opinion, the level of taxable income has been increased, and and profligacy of public spending, have been watched more than 6 abuses of police power, such as torture and secret detention, have bemillion times. come a topic of popular debate. “As taxpayers, we don’t have the right to supervise the use of our “Using this visual medium, I hope we can clear away the fog surmoney. How do we not even have the right to ask how our money rounding information, and make more people understand their own has been used?” said Hung Huang, a famous media commentator, in rights,” Zhao told NewsChina. NEWSCHINA I May 2012



Photo by Xinhua

Vice-premier Li Keqiang (center), then Party secretary of Liaoning Province, visits the city of Benxi, August 9, 2006

Slum Clearance

Out With the Old A slum reconstruction project that began in Liaoning in 2005 has gathered momentum across the province By Liu Yanxun in Liaoning


ounds of ash stood high in front of ramshackle homes, and when it rained, lava-like rivers of dark grey sludge flowed in all directions, eventually settling into a filthy bog. Just 10 years ago, this was the slum district in Fushun, a coal production base in Liaoning Province. The city of Fushun prospered in the 1950s when its rich coal reserves saw it designated


one of the country’s most important industrial bases. By the late 1980s, however, overextraction had taken its toll. The city’s fortunes had declined enormously, due to the sharp drop in coal reserves. The coal mining industry had virtually disappeared, dragging related sectors down with it. Coal mines and factories closed down one after the other, leaving huge swathes of the city’s popula-

tion unemployed. Slum districts, where these workers and their families lived, were falling to pieces. There was no gas supply, no running water, no sewage system, and, it seemed, no hope. On December 26, 2004, the temperature in Fushun was minus 29 degrees centigrade. After less than two weeks in his position as Party secretary of Liaoning Province, Li NEWSCHINA I May 2012

Keqiang, now China’s vice premier, visited Modigou, one of Fushun’s largest and most destitute slums. He was shocked at what he saw. The temperature inside the shacks in the slum was virtually the same as the frozen air outside, forcing residents to sleep wrapped in all the padding they could scrounge. Bathroom facilities were practically non-existent, with 700 people sharing a single latrine. Li said to Zhou Zhongxuan, then Party secretary of Fushun, “We must help these people move out of here, whatever the cost.” His remarks triggered a massive slum reconstruction project that now, just over seven years later, is bringing real benefit to the community. Modigou, an area covering 3.5 square kilometers, sits seven kilometers from downtown Fushun. The slum began to take shape in 1959, when open cast coal mines went into operation in the east and west. The original plan put the life span of the makeshift houses, built to shelter the miners and their families, at 15 years. Half a century later, the slum is still in use. Before reconstruction began, Modigou was home to 3,094 people across 1,146 households, 80 percent of whom were employed in the mining industry. It was the epicenter of poverty in Fushun. Modigou is only one of 55 slums and “slag heap” neighborhoods in Fushun, according to Shi Youcheng, director of the Fushun Housing Administration. With no infrastructure, an impoverished population, and no natural advantages with which to attract commercial property developers, the slums and their residents were on a fast track to oblivion before reconstruction was launched.


The reconstruction project in Modigou kicked off on April 5, 2005. Upon its completion, 106 newly-constructed apartment buildings opened, with a total floor space of 348,000 square meters. 16,018 people in 6,407 households moved into the new homes, including many who used to live in other slums in the region. The slum reconstruction project begun in Modigou was designated as the province’s top priority project, and responsibility for overseeing it rested with Party secretaries from the provincial level down, rather than their depu-


ties or heads of the departments involved. In addition, all city governments signed slum reconstruction responsibility contracts with the provincial government, and progress with the project became an important performance indicator for city governments. Zheng Li, a 63-year-old resident in Beihoutun, another slum in Fushun, used to live in a 28.5-square-meter shack with her husband and two sons. She remembers that the biggest problem with living there was a lack of drinking water. There was not one water tap in the entire district, forcing the residents to dig wells for themselves. Many, including the elderly, had to walk a long distance to and from their nearest well, carrying heavy buckets. The slum’s “public toilets,” essentialy holes in the ground, were predictably overcrowded, and the absence of a sewage system was also a problem. Residents had to pour their household’s waste water, including human waste, onto the open ground. While this quickly froze in winter, the situation was insufferable in summer, with maggots and flies everywhere.

Biting Cold

Heating in winter was another enormous problem. Ma Lihua, now 72, used to live in Modigou with her two sons, both laborersfor-hire. In winter, they collected firewood, but the heat produced was too weak to keep the house warm. The stock of cabbages, which fed the family for the whole winter, had to be covered with padded quilts so the vegetables would not be ruined by the cold. In winter, firewood and cabbages were a family’s most prized possessions. Living in a slum was an obstacle to any young man looking to get married. The stigma of poverty meant that prospective brides shied away. The eldest son of Zheng Li, the 63-year-old slum-dweller, had suffered repeated rejection on account of his lowly digs. But in 2006, when he was allotted a 65-square-meter apartment, it wasn’t long before Zheng’s son felt the benefit of the project. He got married the same year.


Many wondered whether the poor slum residents would be able to afford the new

apartments, even with heavy government subsidies. In order to work around the funding shortage, a plan was devised. The land on which the shanty town sat was to be sold through bidding. Winning bidders were supposed to be responsible for the construction of new apartment buildings, which were ultimately to be purchased by the government after calculating the construction costs. Dong Xiuqin, 49, is a beneficiary from the program, who now runs a small laundry business on the first floor of an apartment building in Beihoutun. The family – Dong, her husband and their son – were previously packed into a 22-square-meter dilapidated shanty in Beihoutun. Aside from the discomfort of living in a leaky shack, Dong and her husband, a sufferer of heart disease and tuberculosis, had to eke out a living by selling vegetables. A typical day would begin at 3 AM, when the couple would hurry to the wholesale center, before riding their creaky tricycle-truck back to the market – no easy task on the often boggy dirt roads. After the reconstruction project was completed, Dong asked for a first-floor apartment which could be converted to a shop, while also serving as living quarters. Her request was granted, and with the help of the community committee, she opened her laundry business. Dong Xiuqin is not alone. According to Bai Yanjie, Party secretary of the Beihoutun community committee, more than 70 percent of the residents in the reconstructed Beihoutun community are still in great need of help and support. Bai said that the reconstruction project aims to help develop ways for residents to make a living, as well as improving their housing conditions. Behind Bai’s words lies a guideline for improving the housing conditions of the poor in the course of the reconstruction project. Issued by the Liaoning Provincial Coordination Group for Slum Reconstruction, the document states clearly, “All city governments should see that jobs are created and training programs are offered for slum residents, in labor-intensive sectors such as construction, construction materials manufacturing, and the service industry.”



Food Security

Carving up the Crops A new grain processing policy purportedly designed to reduce foreign dominance may have cleared the way for State monopolization of a formerly private sector. Is the policy more about profiteering than protectionism? By Li Jia


ommercials for Arawana, an edible oil and grain brand owned by Singaporean conglomerate Wilmar, are inescapable on China’s buses, subways and State-run television broadcaster CCTV. Like most food commercials in China, Arawana’s offerings flaunt the new middle class lifestyle sought after by China’s young professionals, with happy, healthy white-collar families sitting down to dinner in an implausibly pristine kitchen that few Chinese homeowners could afford. The Chinese market continues to embrace foreign food brands, with most consumers seeing them as safer, more reliable, and of better quality than local equivalents. The increasing affordability of foreign brand name products, engendered by rising domestic food production costs, has sweetened the pot. Policymakers, however, have panicked at


the prospect of the total dominance of foreign brand names on mainland Chinese dinner tables. As a result, a new knee-jerk policy has been rolled out to protect mainland businesses from bankruptcy. The government aims to bolster the competitiveness of the State food sector by means fair or foul, with prohibitions on foreign investment a tried-and-tested method of edging out competition in the domestic market. However, market analysts have voiced concerns that widely professed worries over China’s food security are merely a smokescreen to allow State giants to establish the very monopolies the new legislation is supposedly designed to prevent.


Starting January 30, 2012, foreign investments in the processing of almost all kinds

of grains and edible vegetable oils were made subject to stricter application reviews, with foreign majority shareholding in any such business prohibited. This extends restrictions on foreign investment beyond soybean and rapeseed oil processing to cover most of China’s grain and oil market. The new legislation is a reflection of the Chinese government’s ongoing sensitivity to the issue of food security. Claims that foreign capitalists are conspiring to control China’s food supply have permeated domestic media reports in recent years, a paranoia triggered by foreign dominance in China’s soybean sector. The concern is that foreign players, having secured a monopoly over the Chinese food market, will manipulate prices before shifting to an export-oriented operational model, endangering the domestic supply. Arawana has remained China’s most NEWSCHINA I May 2012

popular edible oil brand since 1996. ADM, Bunge, Cargill and (Louis) Dreyfus, the four largest global grain traders based in the US and Europe, popularly known as ABCD, all have a big presence in China’s soybean market, which ceased to be self-sufficient decades ago. These companies have forged alliances to further reinforce their dominance in China’s domestic market. ADM, for example, holds a 16 percent stake in Wilmar, as well as a 13 percent stake in the company’s China operations. A Morgan Stanley report in October 2011 stated that that Bunge and ADM are also expanding capacity in order to export more goods to China. More than 60 percent of China’s edible oil consumption is sourced through imports or domestically processed imported soybeans. Although the ABCD companies generally do not disclose business information, a widely

cited figure in the industry is that about 60 to 70 percent of China’s soybean oil processing capacity is controlled by foreign players. Soybeans are the main source of China’s edible oils, as well as a staple protein and crucial component of animal feed. Nearly 80 percent of China’s soybean supply is imported, with worldwide soybean cultivation, transportation, trading and pricing all dominated by the ABCD companies. In 2003 and 2004, about 70 percent of Chinese soybean processing companies collapsed or were acquired by foreign concerns after they suffered huge losses resulting from sharp price fluctuations at the Chicago Board of Trade (CBOT), the world’s most important agricultural futures trading floor. Monthly reports on the soybean market by the USDA and ABCD’s speculation in the commodity are thought to have played a crucial role.

China’s imports and exports of rice and wheat (10,000 tonnes) 1000








2001 2002 2003

2004 2005


2010 2011

Photo by CFP

Source: Ministry of Agriculture of China

2006 2007 2008

Since 2008, foreign investors have been prohibited from having a controlling interest in Chinese soybean oil and rapeseed oil processing concerns. The government also encourages production and marketing of other edible oils like cottonseed oil and peanut oil. Despite these restrictions being made in the name of food security, the decision to boost soybean imports was made by the Chinese government, which sought to increase the volume of arable land available for grain cultivation. Now, the government seeks to oust the foreign companies it welcomed into the edible oil market by curbing their business in China. However, it may be too late to do so. “These policies can hardly challenge foreign capital’s leadership in China’s edible oil market,” said Guo Qingbao, a senior analyst with the China Grain Network. “Soybean and palm oil, both dominated by foreign capital, make up at least half of China’s edible oil consumption.” Indeed, the new restrictions on soybean processing coupled with rampant overcapacity in the Chinese industry spurred foreign giants to corner a new sector – grains. Wilmar, for example, more than doubled its rice and flour business volume in China in 2010. Like other foreign ventures in China’s agriculture, such as Goldman Sachs-invested pig farms and incursions made by Japan’s Asahi Corporation in vegetable production, Wilmar focused on the higher-end grain market. “More farmers have become net consumers, and the policy on land transfers is getting more flexible,” Lei Wei, Senior Investment




Officer of the International Finance Corporation of the World Bank Group, told our reporter. “This makes more industrialized and technology-intensive agricultural operations both necessary and more feasible than ever. Besides, the growing middle class in China means growing demand for quality farm products,” he added. The role of international speculators in China’s future food security is a legitimate concern to policymakers. In his 1995 book Who Will Feed China?, Lester Brown, a US environmental analyst, asserted that China would have to resort to grain imports to guarantee domestic supply, pushing up world grain prices and starving poorer countries. The debate over how China will continue to feed its 1.3 billion people remains of concern to international observers and the Chinese government. With foreign corporations making inroads into China’s grain sector, conservative policymakers once again began to mutter about “conspiracy” and “threats” to China’s food security. While there is little evidence of the “international conspiracy” darkly whispered about in the mainstream media, there is evidence that ABCD companies pose a significant threat to China’s future food supply.


At least 95 percent of the domestic supply of rice and wheat, the staple carbohydrate for Chinese people, is produced in China. Moreover, Chinese-owned enterprises dominate grain processing. According to the 10-year Plan of the Grain Processing Industry (20112020) issued by the Chinese government in February, Chinese companies registered 75 percent of sales revenue in the grain sector, and produced 99 percent of the rice, 95 percent of the flour, and 72 percent of the corn products consumed in China. In spite of the bullish figures, however, the same document warned that “Chinese companies are facing a survival crisis due to the faster expansion of multinationals into the domestic wheat and rice process-


ing business.” “It reflects the government’s concern over the prospect that the soybean story could be repeated in the grain sector, a sector much more important to China’s food security than soybeans,” said Guo Qingbao. There is evidence that the Chinese government is also worried about foreign dominance in grain production. With only 15 percent of processed grain output coming from State-owned enterprises, the government’s new legislation is perhaps designed to break the back of private grain concerns and funnel more revenue into State coffers. Small-scale, localized operations account for most of the grain processing industry – easy targets for the larger State processors to bring down. The government’s 10-year Plan speaks of “nurturing an array of grain processing giants” by 2020, each having an average sales revenue of US$1.6 billion. “Major grain processing companies” are offered financial support to upgrade technology and engage in “acquisitions” of smaller enterprises. The document’s complementary Five-year Plan for Grain and Edible Oil Processing (20112015) has set expensive capital requirements for market access and states clearly that the central SOEs and other big companies are the focus of the strategy. The plan, if successful, amounts to a wholesale takeover of the domestic grain market by SOEs, boosting government revenue from food sales and giving the authorities more leverage to stabilize grain prices, a key flashpoint for social unrest. However, the plan’s purported aim, to increase competitiveness, seems to be hamstrung by the explicit focus on a handful of State giants. Guo Qingbao told NewsChina that the strategy is likely to put private companies in a disadvantaged position, as “foreign companies, with the edge in both capital and technology, will probably speed up the exploitation of their current competitive advantages to offset the restrictions, exerting a greater pressure on private companies.” “Meanwhile, SOEs will be better posi-

tioned with even more State support,” he added. Professor Li Guoxiang, a specialist on rural development at the Chinese Academy of Social Sciences, also believes that relinquishing an industry entirely to SOE control is a recipe for disaster. There is no guarantee that State monopolies would behave more responsibly than ABCD speculators with regard to grain prices. “[SOEs] have a track record of manipulating grain prices,” he told our reporter. Li alleges that the new policy is more a response to lobbying on the part of grain SOEs rather than a shrewd move designed to protect food security. SOEs already have a monopoly on capital, talent and technology, but tend to use these rich resources far less efficiently than private enterprises. A report by China Enterprise Confederation on 2011’s top 500 Chinese enterprises shows that SOEs lag behind their private counterparts in economic efficiency and investment in innovation. In a more open market, Chinese private companies have shown both profitability and potential. The New Hope Group, for example, has become the world’s second largest animal feed producer. Company founder Liu Yonghao has repeatedly urged the government to give private businesses the same increased corn import quotas already enjoyed by SOEs. His calls, so far, have been ignored. Professor Li is also worried about sending mixed messages to both foreign investors and the Chinese public. While the media may be dominated by conspiracy theories, local governments thirsty for foreign investment continue to shunt domestic private enterprises aside for the easy profits offered by well-established foreign corporations. Professor Li cautions against dividing China’s food supply between State and foreign interests alone. “We should protect food security by preventing foreign companies from gaining or abusing monopolies and at the same time improve our competitiveness by supporting private companies,” he said.  NEWSCHINA I May 2012





Bring it Online As investors lose interest in Chinese e-commerce, high street retailers are seeking to expand their online presence. However, unpredictable profit margins and market saturation make engaging in this cutthroat field a risky business By Sun Zhe


Photo by CFP

Indeed, Yihaontil redian’s recent growth c e n t l y, since its launch few major in 2008, has outChinese retailers saw stripped even that online commerce of its home indusas a legitimate way try. Sales grew 20to make money. fold in 2010 to total Despite skyrocket800 million yuan ing high street rents, A bus stop billboard advertising Yihaodian, the online retailer acquried by Walmart (US$126m), before statically low levels more than tripling of consumption and over 2011 to reach rising labor costs, 2.7 billion yuan having brick-andmortar storefronts remained the most reliable ple dollar-backed funding could mean major (US$427m). By contrast, the company had way to get a return on investment. Online re- gains for this heretofore modestly successful failed to scrape together 100 million yuan tail was for start-ups and cottage industries. retailer, says Chen Shousong, an industry (US$15.8m) in revenues before 2010, when However, major retailers have recently begun analyst with Beijing’s Analysys International. Chinese State insurer Pingan purchased a Online retailers in China have seen soar- stake in the company, offering enough capital to make inroads into this potentially lucrative ing growth since 2003, with their total sales to mount an assault on China’s e-commerce but notoriously risky marketplace. In late February, Walmart, the world’s almost doubling year-on-year, in contrast to market. number one retailer, announced that it had the mainstream retail industry which sees topurchased a controlling stake in Yihaodian, tal sales double every five years or so. Revenue Digital Dominance a Chinese B2C web portal. Though it is un- from e-commerce totaled 774 billion yuan Walmart’s Chinese competitors may have likely that Yihaodian, even with Walmart’s (US$122bn) in 2011, with the sector set to inspired this change of tack, with many rebacking, can catch up with top domestic e- become the world’s largest by 2015, accord- tailers having made their fortunes online. The commerce portals such as Jingdong or Dang- ing to the Beijing-based IT research institute country’s two major home appliance retailers, dang in the near future, the injection of am- iResearch. Suning and Gome, have become well-estab-




Photo by CFP

lished in e-commerce since launching B2C websites in 2010. Both retailers sped up penetration of online markets after last year’s dip in home appliance sales caused by a slump in the real estate market. Suning’s B2C portal Yigou recorded revenue of 8 billion yuan (US$1.3bn) in 2011, quadrupling its sales from a year earlier to become China’s third largest B2C retailer. Suning’s public statements made references to the company becoming China’s Amazon, though its sales still lag far behind the nation’s second biggest online retailer - 360buy, owned by Jingdong, whose 2011 sales totaled 30.9 billion yuan (US$4.9bn) or 13 percent of the country’s entire B2C market, a threefold increase on 2010. Tmall, China’s eBay, an Alibaba-owned platform that houses and services thousands of small B2C retailers remained unbeaten in the number one spot, enjoying a market share of 36 percent in 2011. Gome’s, which it acquired in 2010, along with a second portal launched last year, made more than 3 billion yuan (US$474m) over the same period, accounting for less than 5 percent of Gome’s total sales, though the company has pledged to double this figure in the coming years. Despite their impressive cornering of a section of the online retail market, Gome and Suning have largely built their success on establishing a widespread network of stores throughout China’s cities and townships. The two companies collectively own more than 1,200 outlets nationwide, accompanied by a comprehensive logistics network. It is this infrastructure, according to Ding Liguo, CEO of industry website, that has allowed both companies to flourish in the B2C arena, getting products to consumers faster than most competitors. “Being equipped with a complete logistics chain means less investment in infrastructure than, say, their major rival Jingdong, which is spending lavishly to build up a delivery network,” Ding told NewsChina. With collective annual sales of more than 100 billion yuan (US$16bn) over the past few years and long-established marketing strategies, Gome and Suning are likely to continue to gain ground over smaller retail-

“The question is whether the market is still worth battling for, as the potential profits, if any, are so low.”

ers in the online sector which, in China, has embraced major brands and their immense reserves of capital, often at the expense of small and medium-sized enterprises.

Size Matters

Between 2010 and 2011, China’s B2C market grew about 130 percent with total revenues of 240 billion yuan (US$38bn), thanks to aggressive marketing tactics such as blanket advertising and widely-publicized discount promotions boosting sales on major portals such as Tmall, 360buy, Suning and Vancl, according to Analysys International. Industry observers anticipate a slowing down in growth this year in tandem with the capital markets that funded many of these expensive publicity stunts. According to Zero2IPO, a private equity

and venture capital research firm based in Beijing, investment in China’s e-commerce industry totaled US$47bn in 2012, double that recorded in the previous five years combined, however the torrent slowed after the first six months of the year before bottlenecking in August. Venture capital-loaded players had burned through money with expensive advertising campaigns while also slashing prices in the hope that such actions would secure a share of the market. However, with all players engaging in the same tactics, consumers were split between companies, resulting in losses. “Most of the time, prices were so low that you could be sure that the companies were losing money,” Ding Liguo told our reporter. Analysys International has remarked that rarely, if ever, have major B2C portals broken even, due to the excessive cost of logistics and marketing splurges undercut by price wars with competitors. As the capital market has continued to lose interest in e-commerce, smaller B2C portals have been dying out en masse since late 2010 from a combination of capital strain and the increasingly ferocious price wars among major retailers like 360buy, Yigou and Dangdang. Chen of Analysys International believes that the market will likely enter a phase of mergers and consolidation, a phase which is unlikely to be favorable to small retailers. Even big players like Jingdong and NYSElisted Dangdang have felt pressure on their cash flow, since both companies began charging additional fees for orders priced below 29 yuan (US$4.60) to offset growing logistics costs, angering customers who had previously enjoyed free delivery services. Jingdong received an investment of US$1.5bn (US$237m) in early 2011 from a group including the Tiger Fund, Digital Sky Technologies (a Russian internet investment group) and four other investors, the largest single capital injection ever into China’s IT industry. “The good news is that the expansion of traditional retailers online will provide new momentum to the B2C market,” Ding told NewsChina. “The question is whether the market is still worth battling for, as the potential profits, if any, are so low.”



iPad Battle

Golden Apples The David and Goliath struggle between Proview and Apple over the rights to the iPad is about more than just money By Li Jia


mall is beautiful, like Apple’s iPad. Numerous consumers around the globe are obsessed with the market’s leading tablet computer. Small can also be powerful, like Proview, a Chinese company teetering on the brink of bankruptcy. The weapon that has enabled it to challenge Apple is something intangible - the iPad trademark. On March 8, 2012, Tim Cook, Apple’s new CEO, unveiled the long-awaited “new iPad” in San Francisco and announced that it would hit shelves on March 16. The same day, lawyers of the Shenzhen-based Proview Technology declared they had filed an application with the Chinese customs agency for a ban of imports and exports of all iPads. The feud, popularly described as “a fight between an ant and an elephant” in the Chinese media, caught Apple, no stranger to litigation, unusually off-guard. In a lawsuit filed by Apple in May 2010, a Shenzhen court upheld Proview’s claim on rights to the iPad trademark on the Chinese mainland. Apple appealed, and the case was passed to the People’s High Court of Guangdong Province. Industrial and commercial authorities in some cities have already pre-empted a ruling in favor of Proview by ordering iPads off the shelves. According to Apple’s 2011 Q4 business report, the Asia-Pacific market, led by China, has become the third largest global market for Apple in terms of sales after the US and Europe. More iPads are sold in China than in technology-mad Japan. Demand for Apple products, seen as status symbols among young Chinese, has led to a new nickname - “guofen,” or “Apple fan.” Statistics from Analysys International, a leading IT information provider, show Apple has secured more than 70 percent of the tablet computer market in China despite strong competition from Samsung and Lenovo.


The Chinese media have been quick to paint Apple as the bad guy in the muchhyped legal battle. Some outlets took the opportunity to attack Apple’s “slow response” to media inquiries and consumer complaints, warning that Apple will “finally have to pay for its arrogance.” Some have called the case a “lesson” for Chinese companies on how important it is to secure adequate protection for their trademarks. As Chinese companies are more usually the target of IP infringement lawsuits, “It would be rum indeed,” remarked a blog post on the website ofThe Economist attributed to author V.V.V, if Apple lost the case and faced the consequences of changing the name or halting iPad exports “simply because intellectual property rights and the rule of law are, in fact, upheld.” NEWSCHINA I May 2012

The Bite

Prior to the 2008 global financial crisis, Proview had secured a strong position as one of the leading manufacturers of computer monitors worldwide. According to company founder Yang Long-san, speaking at a press conference in Beijing in February, its Taiwan subsidiary Proview Electronics registered the iPad trademark in a number of countries around the world in 2000. In 2001, Proview’s Shenzhen subsidiary had two iPad trademarks registered on the Chinese mainland. Yang said that Proview produced and sold computers under its iPad brand in early 2000 around the world. However, the company’s iPads failed to charm consumers, and were later withdrawn. In December 2009, a London-based company called IP Application Development Limited (IPAD, but known as IP) reached an NEWSCHINA I May 2012

agreement with Proview Electronics to buy the global rights to their iPad trademark for 35,000 British pounds (US$55,000). In early January 2010, Apple launched its iPad. One month later, IP Ltd sold the iPad trademark to Apple for 10 British pounds (US$15). Proview had failed to discover that IP Ltd was simply a front company for Apple. Proview’s stock value plunged in the same period. Share trading of Proview International, the parent company of both Proview Shenzhen and Taiwan, was suspended on August 2, 2010. The Hong Kong Stock Exchange announced that Proview would be delisted in June 2012 if the company could not “provide a viable resumption proposal.” Confirmed outstanding bank loans of Proview Shenzhen reached US$180 million. The fight with Apple is in fact the only hope for Proview’s survival and for its creditors to recoup their losses, though the company has yet to make any compensation claims. Proview insisted that the rights to the iPad trademark in China are still held by its Shenzhen subsidiary, and were not part of the company’s deal with IP Ltd. In May 2010, Apple and IP Ltd sued Proview in Shenzhen. The Guangdong Provincial Court has yet to decide whether the deal reached by IP Ltd/Apple and Proview Electronics included rights to the iPad trademark on the Chinese mainland. Proview has also filed a separate lawsuit in the US against Apple and IP Ltd, accusing them of fraud in the process of buying the trademark. With their only alternative being bankruptcy, Proview are clearly in this legal battle for the long haul.


Under Chinese law, trademark ownership transfer is not effective until the transfer is approved, at the request of both parties, by the Trademark Office of the State Administration for Industry and Commerce (SAIC). That approval, according to the verdict of the Shenzhen court, had not been secured when Apple and IP Ltd sued Proview. In addition, Huang Yiding, vice president of Hejun Vanguard which acted as coordinator for the eight banks extending credit to Proview Shenzhen, told media that the trademark had been held in trust by all eight banks in 2009, even before the iPad deal was signed. That means no trademark transfer contract would be legally effective without consent of the all eight banks. Huang told NewsChina that Apple had negotiated with both Proview and these eight banks before the iPad debuted on the Chinese mainland market, showing Apple was aware of all facets in the



Photo by CFP

Photo by CFP

deal. Few give credence to the notion that a January, told NewsChina. Several others told company as well-established as Apple would “I will ask my friends to bring us they didn’t care what the iPad was called, fail to do due diligence when purchasing so long as it was an Apple product. trademarks from competitors. However, me a new iPad from abroad if Chen Naiwei, vice chairman of the Shangsome claim this is precisely what happened. imports are banned.” hai Bar Association and an IP expert, ex“Do not rely on assumptions or represenplained that IP is a domain which is defined tatins from the other sides, always conduct as a private right but at the same time has a your own due diligence,” said a report on the direct impact on the public interest. That is iPad case by Mayer Brown JSM, a US-based why the protection of this private right and global legal service organization. the prevention of its abuse are both reflected Some analysts have obin basic intellectual property served that IT companies law worldwide. The Apple prioritizing state-of-the-art case, he argues, is unusual as innovation with a view to it involves two kinds of pubgain a swift lead in the marlic interests. ket often do not invest as Both consumers and the much in legal compliance market have a stake in Apas manufacturing or more ple’s success. Any obstacle “traditional” IT companies. to the import and retail of While this risky strategy can Apple products will hurt often pay dividends, in an both. In addition, Analysys increasingly complex global International has claimed economy, hi-tech products, that if the launch of the new including thousands of iPad in the Chinese maincomponents developed or land is delayed because of innovated by dozens of inthe trademark dispute, iPads ternational companies, are sold through unauthorized likely to be awash with copy- A witness for Apple chose not to discuss the case with reporters during the hearing at dealers could become the the People’s High Court of Guangdong Province, February 29, 2012 rights, making it extremely norm. Domestic sales would difficult to identify a single suffer, with China’s consumproprietor. The Proview deal, ers heading offshore for their merely involving a few thoupurchases, a phenomenon sand dollars, was easily overalready familiar to domestic looked by a company like market observers. Apple, valued in the billions. More important, any rulEven in the US, where first ing will influence the counusers of a trademark have try’s innovation strategy. traditionally been privileged Chen Naiwei voiced his conover “first-filers” to prevent cerns that Chinese media at“brand squatting,” the systacks focusing on the “blow tem is changing. Facebook, to Apple’s arrogance” smack which has yet to have a tangiof gloating. Some are conble presence on the Chinese cerned that a tit-for-tat IP market due to a government war pitting Chinese compaban, has already registered nies against the world could more than 60 Chinese tradeensue. marks to avoid any possible A man holds up his iPad outside the People’s High Court of Guangdong Province Several high-profile tradeduring the hearing of the Apple/Proview case, February 29, 2012 disputes in the future. mark disputes between foreign and Chinese brands Consumer Choice have been heard in Chinese “I will ask my friends to bring me a new iPad from abroad if im- courts. Hermès lost a lawsuit against Chinese clothing brand Aimashi ports are banned,” one customer at Beijing’s crowded Apple Store in over use of its Mandarin-language brand name. The Shanghai court Sanlitun, scene of rioting during the release of the iPhone 4S debut in will hear Michael Jordan’s case against a Chinese sportswear company



which uses the Mandarin transliteration of the basketball star-turned-businessman’s name, Qiaodan, later this year. There is evidence that foreign companies are also engaging in questionable practices when it comes to IP infringement and Chinese companies. Some Chinese brands targeted by foreign critics for IP infringement such as home appliance manufacturer Hisense and IT giant Lenovo have seen their trademarks registered by foreign companies overseas to undercut their future global reach. Many have already been forced to pay huge amounts of compensation, or change their branding. Some media have called for further attempts to damage the influence of foreign brands on the Chinese mainland by using the same unsavory tactics. If these become the “lessons” Chinese companies take away from the iPad trademark dispute, Chen warns, it will simply further erode domestic innovation in China. Chen argues that a product’s “real value” is not its trademark, but its quality and reputation. Apple is regularly held up as an example of allowing products to speak for themselves. Even media criticism in China has not claimed that Apple produces inferior products and uses its branding to foist them on unwitting consumers. “The foundation and purpose of IP protection is to create substantial innovation,” said Chen. Jack Chang, chairman of Quality Brands Protection Committee of the China Association of Enterprises with Foreign Investment, does not subscribe to the idea that trademark fights between foreign and Chinese companies have been rising in China. He does, however, concede that some small and medium-sized Chinese companies tend to use brands with similar-sounding names to well-respected foreign brand names, a practice not tolerated abroad. “These free-riding tactics may work in the short term, but do not help build a lasting brand,” he said. “That ideological difference is one of the important factors behind trademark disputes between foreign and Chinese entities.” The iPad dispute and other recent trademark disputes are different by legal definition. But the lessons are the same. Trademarks matter most when attached to a product that the market, and consumers, have embraced. NEWSCHINA I May 2012


bynumbers Rate of return on investment for the NSSF

2001 - 2011




Percentage of the US$45bn of investment yields in the National Social Security Fund coming directly from the stock market in the period 2001 2011


40 30

30 20

20 10

10 0 -10

2001 2002






0 2008 2009

20 US$27.8bn 50 40 30 20 10 0 -10






2008 2009



Source: National Council for Social Security Fund 2005



2008 2009



30 20

10 Short-term capital inflow 0 into China in February, leading-10 to a US$4bn increase in -20 outstanding for foreign funds -30 exchange, although China also-40logged a record 10Oct.2011 Nov.2011 Dec.2011 -50monthly year trade deficit of US$31.5bn 2001 2002


2001 2002





10 0 -10 -20 -30 Jan.2012

-40 -50









Change in funds outstanding for foreign exchange (bn)

Source: People’s Bank of China 20

Change in short-term capital flow (bn)



0 -10






15.2% 1.6% 23.4%

3.5%rev-1.6% China’s budget deficit in 2012, accounting for 1.5% of GDP. Total fiscal 1.4%was US$1.84tn and total spending 6%was US$1.97tn enue

-40 -50







1.4% 1.5% 10.4% Education 5.2% Sci-tech

5.2% 3.3% 23.4%

15.2% 3.5%

7% 9%

1.4% 1.5% 5.2%





3.3% 3.5%

7% 9%


Source: Ministry of Finance

19 Designated areas in northwest, central and southwest China which, according to the country’s first national strategy, must produce 6.5 billion cubic meters of shale gas by 2015 Source: National Energy Administration

6% Urban and rural commu-

3.5% Culture, 3.3%media and sport



Treasury debt servicing Defense


Social security

nity affairs 10.4%





Energy conservation and

Agriculture, forestry and

environmental protection


Other (foreign affairs,


supervision over land and finance, etc.)

25 million Urban unemployed in 2012, including this year’s 6.8 million college graduates. This number is 1 million more than the annual average for 2006 and 2011 Source: Ministry of Human Resources and Social Security



Water Pollution

Protection Money China’s first inter-provincial environmental compensation system has just been launched to cover a river basin spanning Anhui and Zhejiang provinces, protecting the area against pollution while improving the local economy. Will it genuinely improve life at the water’s edge? NewsChina investigates By Wang Yan in Anhui and Zhejiang


o the naked eye, the Xin’an River seems to have gushed forth from an ancient scroll painting. Straw-hatted farmers putter back and forth in tiny boats, while verdant mountains erupt from its banks, their peaks obscured in the morning mist. Time seems to stand still. The river basin, an area covering nearly 11,674 square kilometers (4507 sq miles) has held onto its lush beauty despite the country’s sweeping modernization and development process, which has caused some major waterways to dry up, and others to fill with toxic pollutants. “However, due to industrial restrictions implemented in the name of river protection, Huangshan, the river’s source, has sacrificed both urban development and improvement in the livelihoods of local people,” said Liu Yulong, a researcher from the China Institute of Water Resources and Hydropower Research. “No one has the right to thwart a city’s economic growth, that’s why a sound system of ecological compensation is vital to achieve harmony in a watershed ecosystem,” he continued.

to China’s eastern seaboard, passing through Zhejiang Province, merging with other tributaries and finally forming the Qiantang River before being embraced by the ocean. As the major source for Xin’anjiang Reservoir, or One-Thousand-Island Lake (see “Sunken Treasures”, NewsChina, July 2011) in Chun’an, which provides drinking water for people of Zhejiang and is a strategic reserve for the whole Yangtze River Delta re-


The Xin’an River originates in mountainous Huangshan, Anhui and runs all the way




Photo by Shi Guangde/CFP

The total length of Xin’an River is 359 kilometers (223 miles) and the upper two thirds lie within Anhui Province

gion, the river’s water quality is critical for the health of millions. Thanks to the Huangshan regional government’s continued environment protection efforts in the past decade, including restricting the construction of riverside chemical and textile factories, and restrictions on the usage of pesticides and fertilizer in farming, the river’s water quality is far better than most all other major rivers in the country. Listed as a “first-class drinking water reserve,” the One-Thousand-Island Lake reservoir, which many believe to be naturally formed, enjoys a nationwide reputation for its crystal clear waters. With government estimates indicating that some 70 percent of China’s water sources have been contaminated, mainly due to the mining (see “Finding the Source,” NewsChina March, 2012), chemical, textile and power industries, Xin’an has come to be known as one of China’s last environmental oases. Slow industrial development is the tradeoff for ecological protection, particularly true of waterways. Official statistics indicate that Huangshan’s per capita GDP in 2011 was 27,873 yuan (US$4410), around 32 percent of that of Hangzhou, the capital of Zhejiang Province. Large numbers of people in three major riverside counties including Shexian, Xiuning and Qimen live below the provincial poverty line. The Huangshan government responded to our enquiries with a statement that: “In the past ten years, apart from efforts including spending over 4.08 billion yuan (US$646m) relocating 70 companies and 9.95 billion yuan (US$1.57bn) upgrading industrial equipment, the city ordered closure of a total of 150 enterprises which were causing pollution, and in the past three years, a total of 160 projects amounting to 16 billion yuan (US$2.53bn) in total investment which could not meet minimum environmental standards were rejected by the municipal government.” Some might call this an exemplary record. However, in a country where a region’s success is measured in hard currency and not in the clearer water or green hills, failure to maximize industrial productivity can raise hackles at higher levels. Wang Fuhong, Party secretary of Huangshan city, admitted to the reporter that “ef-

fective practice on environmental protection and pollution management has prevented ecological damage, but our city has also sacrificed a lot of development opportunities.”


In the past two decades, deforestation, soil erosion and the over-extraction and pollution of water in many parts of China have done irreparable damage to countless ecosystems. In order to avoid further entrenchment of the “pollute first, recover later” mindset taking hold in the provinces since the early 2000s, the central government and research groups started to explore more effective patterns of protecting waterways, with the official listing of the Xin’an River seen as a pilot program. The concept of “ecological compensation” or the internationally-adopted Payment for Environmental Services (PES), which requires enterprises, households or government agencies to pay for any cleanup operations necessitated by commercial activity, was rapidly introduced and accepted in China. According to a report entitled Chinese Practices of Ecological Compensation and Payments for Ecological and Environmental Services and its Policies in River Basins submitted to the World Bank in 2006, “the PES model is developed from initial subsidies of environmental protection to the current compensation for the limitation of development rights and payments for ecological services.” On April 17, 2006, at the sixth National Conference on Environmental Protection, Premier Wen Jiabao stated that the policy and mechanisms of PES must be established and improved based on the following principles: “Users should protect, destroyers should restore, and beneficiaries and polluters should pay.” Liu Yulong told our reporter that research on the implementation of the Xin’an River basin eco-compensation program was completed as early as 2005, and the report was presented to both the Anhui and Zhejiang provincial governments. Following years of negotiation, the compensation mechanism finally began trials in 2011. “This is the first inter-provincial water ecosystem compensation attempted either inside or outside of China,” Liu told our reporter. According to the trial eco-compensation



The 300 million yuan promised by the central government was first allocated to Anhui in 2011. According to the Huangshan government, the money was spent on ecoimprovement projects such as rural garbage collection, fish cage dismantling along the river, riverboat sewage collection and treatment, the construction of water treatment and garbage incineration plants, flood control and environment monitoring, among other projects. The Huangshan government also plans to spend five years and a total of 40 billion yuan (US$6.3bn) on 500 key water treatment projects to fulfill the stated aims of the Xin’an River water quality control program. 725 fish cages have been dismantled and 370 fishermen banned from breeding fish along the river’s main stretch to lower the level of organic content in the river, which can lead to algal blooms and other problems. “By the end of 2013, all the fish cages along the trunk river will be eliminated, and tributary fish feeding will be regulated,” said Wang Fuhong. In Zhangtan, a small riverside village on the southern bank of the river, a few concrete garbage pits were constructed in 2011. The local village authorities appointed villager Zhang Haisheng to transport the garbage to a nearby incineration plant. Zhang receives a monthly salary of 500 yuan (US$79) to collect refuse from each village household and transport it to the local incineration plant. “Before 2011, villagers



The main goals of the eco-compensation scheme were to improve quality of life for the millions of villagers living along the banks of the Xin’an River. However, due to the limited compensation, other than a few minor improvements such as refuse collection, few are feeling the benefit, and others have found themselves thrust deeper into poverty. A lack of local industrial jobs has left local young people with few employment options. An estimated 80 percent of rural villagers under 30 work in the cities, with the few re-

Photo by Wang Yan


would just throw garbage in the street, or in a pile near the riverbank. When it rained or there was a flood, the garbage was washed into the river,” said Zhang. All four villages our reporter visited had already adopted the same garbage disposal system as Zhangtan. However, the impoverished communities along the riverbank have bigger problems than where to throw their garbage.

Lacking better infrastructure, boats are the only transportation method for local farmers

Photo by Wang Zhiqiang/CFP

agreement, the central government will allot an annual 300 million yuan (US$ 46m) to Anhui Province to pay for protection of the river; in addition, both Zhejiang and Anhui will set aside 100 million yuan (US$15m) as mutual compensation funds, with payouts dependent on the water quality at its point of entry into Zhejiang. Fang Zhaoxing, vice director of the regional Chun’an Environmental Bureau told NewsChina that since early February, Anhui and Zhejiang have commenced joint monitoring at Jiekou, the border between the two provinces. “Some issues, including water quality standards, remain unsettled.”

Happy with their loquat harvest, local farmers long for more convenient transportation, so as to sell their fruit for a better price

maining families dependent on growing tea leaves, rapeseed and loquats. Once grown, these goods are hard to transport due to the almost medieval levels of local infrastructure. Only a handful of bridges span the river, and there are barely any passable local roads, with bamboo rafts acting as ferries between villages the principal mode of transport. “Since we do not have convenient transportation on this side of the river, our loquats and tea leaves sell for much less than those from villages on the north bank,” local farmer Zhang Haisheng, 51, told NewsChina. He added that each year his family loses 3,000 to 4,000 yuan (US$474 to 632) due to its isolation. With a total annual income of barely 10,000 yuan (US$1,581) per year, a 40 percent loss of income is devastating. “If they just built a road, things would be different,” he added. Farmers have attempted to carry their fruits on the cross-river bamboo ferries to try for a better price on the northern shores. However, even this rickety form of transport can vanish in the event of a flood. “It is a chaotic situation during the harvest season in May or June when all the villagers cram onboard carrying heavily-loaded bamboo baskets,” said Zhang. “Some villagers fall into the water, and lose their goods.” Zhang’s septuagenarian mother showed our reporter a scar on her left shin, attributing it to a boating accident. The new prohibitions on fish breeding have hit local fishermen hard. 4,000 yuan (US$ 632) in compensation from the government is nowhere near enough to cover the losses of a fishing family which may have fished the Xin’an River for generations, suddenly put out of business. Even the Huangshan government has admitted that it is hard for such families to survive. “This is still a pilot program, and it could be a good opportunity for the upper and lower regions to create a dialog,” said Liu Yulong. “Whether it will encourage legislation on ecological compensation, or be promoted in other river systems, still remains unclear. The government needs to see this mechanism mature before implementing it across the country.” “I am afraid that when it finally becomes mature, most of the country’s rivers might have been irreversibly polluted,” he added. NEWSCHINA I May 2012

A widely-used poster of Lei Feng


n March 5, 1963, Chairman Mao Zedong issued a simple directive, calling on the whole nation to follow the example of Lei Feng, a Chinese soldier who, the story goes, devoted his life to altruism before being killed in a freak accident. March 5 thus became “Lei Feng Day.” Relegated to little more than a kitsch image of communist nostalgia in recent decades, “Lei Feng spirit” was officially exhumed in early 2012, when the government attempted to re-hash the moral instruction campaign that Lei had fronted half a century ago. “As a model of socialist and communist ethics, Lei Feng has set a good example for all Chinese people. Behaving like Lei Feng should be the norm, rather than a yearly activity,” claimed an official document issued by the Central Committee of the Communist Party of China. While the authorities’ onedimensional effort to use Lei as a NEWSCHINA I May 2012

Photo by Xinhua


Lei Feng

Man or Myth?

The government’s attempt to revive the image of Lei Feng is serving only to fuel curiosity about the man behind the model citizen By Xie Ying

moral standard has met with predictable ambivalence, the campaign has given impetus to a recent wave of curiosity about the truth behind the man on the posters. As more and more historical records and publications surface depicting a decidedly alternative profile to official records, a growing number of people are questioning the so-called hero’s heavily propagandized image, and whether there really is anything left to learn from Lei Feng.

Image of a Hero

Born in 1940, Cao Wenling, a retired school headmaster in Beijing, still remembers the nationwide campaigns that used Lei’s image to guide Chinese people’s moral values. “Lei Feng fever” began in 1961, when the Shenyang Military Zone, where Lei served as a soldier, began a political education campaign in which soldiers and officers were asked to recall the miseries and evils of the “old society” (the era before the founding of the People’s Republic of China in


Photo by fotoe

1949), so as to heighten their consciousness of class struggle. Though having joined the army just one year earlier, Lei Feng was highly and publicly praised for his revolutionary zeal and loyalty to the Party. He effectively became the campaign’s spokesmodel, often made to deliver speeches to units across the armed forces. According to his official biography, Lei Lei Feng on a borrowed motorcycle beside the Tian’anmen Rostrum, November 1958 died the following year, when an army truck he was directing accidentally struck a telephone pole, which fell on Lei’s head. His death conveniently made him the perfect martyr to altruism, adding powerful emotional weight to the pro- ever, it appears to be daytime. paganda campaign he had fronted. The Shenyang Military Zone A post widely circulated on the Internet hints at the possibility of a went on to launch a new campaign centered around Lei: the famous darker story behind the Lei Feng legend: “Photography was a luxury “Learn from Lei Feng” effort. in the 1960s, but Lei Feng, supposedly a lowly soldier, could some“Lei Feng was around us constantly in those days. Posters bearing how afford to take over 200 photos within one year. Could it be that his image were everywhere, and newspapers the government anwere full of stories of people who had learned ticipated he would from his example. Learn from Lei Feng songs die young, so they were on constant rotation on the radio,” Cao took so many picrecalled. tures of him in ad“At that time, all communities and schools vance?” were asked to organize ‘doing good’ activi“It is said that Lei ties, such as helping the elderly with houseFeng made regular hold chores and cleaning public places,” he donations to the continued. “In our school, pupils had to needy, sometimes go door-to-door, promoting the Lei Feng as much as sevspirit.” eral hundred yuan, All this helped establish a cult of personwhile his soldier’s ality around Lei Feng – at once the perfect allowance was only six yuan a month. soldier, the ideal communist, and a paragon How could he afof self-sacrifice. With perfect posture, a spotford it?” the post less uniform, and a submachine gun, as the Lei Feng (back row, right) with his fellow soldiers in an art performance, continued. story goes, Lei spent his non-soldiering time Shenyang, March 13,1960 Lei’s paradoxirepairing army trucks, washing clothes for cally famous desire his fellow soldiers, helping the elderly cross to remain anonymous has also been the subject of many a raised eyethe street, and donating his humble savings to those in need. brow. Another web post jibed: “Lei Feng never ‘left his name’ after doing good deeds, so we’re lucky he recorded his every move in his Doubts Over the years, though, doubts have surfaced over the authenticity diary.” Zhang Jun, an army photographer who shot most of Lei Feng’s of Lei’s impossibly squeaky-clean image. Perhaps the earliest piece of evidence to come to light is a photo of Lei reading the works of Mao pictures, confirmed suspicions in an interview with NewsChina in Zedong by flashlight. Outside the window in the background, how- 2009: “After the army launched the Lei Feng campaign, we organized



Photo by Anoymous


a photography team. To achieve the desired effect, we staged some photos, and edited some others.” A good example is a photo showing Lei Feng standing in front of Beijing’s Tian’anmen Gate, holding a basket of flowers. When the photo was made public, the flower basket had conspicuously been removed. Zhang explained that, at the time, flowers were a symbol of the bourgeois lifestyle. One anonymous online critic went one step further, probing the root reason for Lei’s deification: “March 5 is neither Lei Feng’s birthday nor the date of his death, but the date he was immortalized by Mao Zedong. So, it is more a memorial for Mao. Just like Mao, Lei Feng has been deified for political reasons.”

Real Lei Feng

In 1996, a new book, entitled Lei Feng (1940-1962), showed the public a never-before-seen side of the hero. In one photo, a beaming young Lei in fashionable clothes sits atop a motorcycle beside the Tian’anmen Rostrum. “It was a fashionable thing to be photographed by the Tian’anmen Rostrum in the 1950s and 60s, not to mention riding a motorcycle,” Cao Wenling, the retired headmaster, explained. “This image is totally different from what we saw in the posters.” In March this year, Huawen Publishing House released its Lei Feng Collections (Lei Feng Quanji), featuring a large number of photos of the young man, in addition to pages of diary entries, speeches, letters, essays, poems and stories purportedly written by Lei, most of which had never been seen before. The book taught the public about Lei Feng, the man. It contained first-hand accounts of his personality and behavior, as told by his photographers, former colleagues and comrades-in-arms. With the plethora of new material, Lei Feng’s stiff image is gradually being transformed. The general consensus is now that Lei was a fashionable, charismatic young man, whose generally amiable personality was exploited for political means. “Lei Feng loved taking photos, and he cared about his appearance so much that he would check his hair every time he passed by a mirror,” recalled Feng Jian, Lei Feng’s former colleague. A particular area of interest has been the revelation of Lei’s love for literature. His bookshelf was stocked not only with the ubiquitous works of Mao Zedong, but also with many Russian novels, which were very popular among the Chinese youth in the 1950s and early 1960s. He even wrote romantic poems and stories. According to the book, in 1958 he composed two works of fiction, two essays and nine poems. Perhaps most shockingly to a public used to Lei’s image as a celeNEWSCHINA I May 2012

bate communist hero, recent research on Lei has revealed a treasure trove of outlandish love-letters written in his hand. “I wish you a floral youth, spreading fragrance over the motherland,” read a goodbye message to Wang Peiling, his first love. “Wang was a girl who worked with Lei on a farm in his native Wangcheng County, Hunan Province. When Lei was about to leave the farm for the steelworks in Anshan, Wang gave him a diary as a keepsake, saying he was like a brother to her,” reads a note in Lei Feng Collections. According to Xing Huaqi, the book’s chief editor, he and his team searched for Wang for years before tracking her down in 1996. When asked why she had chosen to remain in obscurity, Wang said that Lei Feng was a national role model, and she was “too ordinary to stand side-by-side with him.” With Lei’s exaggerated image gradually deflating, Wang’s worries may now be obsolete. Zhang Jun, the photographer, recalled that “Lei Feng was an ordinary guy in everyday life. He would show off his medals, show up late for training, and even sneak into the mess for snacks.”

Lei Feng Today

Busting the myth of Lei’s superhuman capacity for altruism, the books have actually brought him a modest boost in popularity. According to media reports, the first batch of 200,000 Lei Feng Collections reportedly sold out within a month. “Lei Feng was just a regular young guy, following the same trends as everyone else,” Zhu Xiaopei, a grad student living in Beijing, told NewsChina. “It is not self-contradictory to follow fashion whilst at the same time being a role model,” Shi Yonggang, the author of the book Lei Feng (1940-1962), has been quoted as saying. “Lei Feng can be both trendy and morally influential.” However, not everyone has bought into the rebranding of the communist legend. For some, Lei continues to represent the use of a false ideal in order to manipulate the collective consciousness. On a Lei Feng-themed forum on China’s largest web portal, Lei Feng’s fans come under heavy criticism: “He is not a man, but a God-like ideal. We can worship him, but we can’t learn from him,” said one poster on the forum. “In today’s world, where goodwill is often seen as malice in disguise, isn’t it outdated and naive to talk about doing as Lei Feng did 50 years ago?” questioned another. These conflicting ideas, in Cao Wenling’s opinion, are rooted in modern social values. “What society needs today is neither a real nor a deified Lei Feng, but a revival of faith in the good.”



Peking Opera

Resetting Peking Opera, itself originally a product of experimentation, has had its canon shaken up by the injection of new ideas and styles. However, maverick directors seeking to innovate have faced a less-than-positive public reaction By Wan Jiahuan




Debut of the revised Farewell My Concubine on February 28, 2012. By adopting the latest stage technology and new art forms, the “new Peking opera” has caused much controversy

Courtesy of Reignwood Group, excpet noted otherwise

the Pace




hen the new edition of the classic opera Farewell My Concubine, a masterpiece made famous by China’s biggest opera star Mei Lanfang (1894 – 1961) and popularized by Chen Kaige’s film of the same name, premiered in late February, it shook opera-loving conservatives to their core. What had been an hours-long original tale of a defeated ancient general bidding a tearful and protracted farewell to his concubine before breaking through the enemy lines had been compressed to 50 minutes. Handmaidens surrounding the general dressed in elegant ancient costumes eschewed the rigid contortions of Peking Opera in favor of looser, more contemporary forms. Pipa (Chinese lute) players were arranged in the aisles to give a more “stereo” accompaniment. Fighting between soldiers supplanted stylized stage fighting with modern kung fu. A 3D screen provided vivid and lightning-quick scene changes. Finally, a live war horse was even brought on stage. While performers stuck to the (abridged) script, “the structure and form are closer to today’s audience,” according to Chen Shizheng, the opera’s New York-based director. Diehard fans of traditional opera, however, reported the opposite sensation – feeling alienated. In the western-style theatre, audience members were reluctant to cry “hao!” – “bravo!” after particularly stirring recitations. Cheering a good performance is par for the course in the often raucous atmosphere of a traditional Chinese opera house. However, for the new production of Farewell My Concubine, the auditorium remained eerily silent. “We are considering hiring some ‘applause leaders,’” said producer Wang Xiang. The company is going to great lengths to secure a global and domestic market position. Local Peking opera stars Meng Guanglu and Ding Xiaojun have been given leading roles in a cast and crew largely comprised of members from Germany, America, England and Italy. After the opera’s debut in Beijing on February 28, the company was signed for performances during Chinese Culture Week in the run-up to the London Olympics in July and August.

Gaining Access

Few modern Chinese can understand tra-


The general and his concubine display their new color scheme

ditional opera lyrics by ear alone. The gorgeous makeup and costume, the hallmark of the genre, has remained as unchanging as the lyrics of most classical operas. While TV, movies, popular music and the Internet have continued to be the nation’s preferred forms of entertainment, Chinese opera has struggled to find a place, even with widespread promotion through its own dedicated State TV channel, and in several patriotic movies. “This project needs to be seen as brand new. Otherwise it’s not worthy of production. [The old style] has lost its vitality,” said Chen Shi-zheng in October 2010 during a roundtable with production companies and other key industry figures. In 2010, Wang Xiang proposed a list of directors to investor Yan Bin, chairman of the board of Reignwood Group, who planned to stage a Peking opera in the group’s dedicated theater in Beijing. As one of the most wellconnected advocates of Chinese opera, Wang Xiang has successfully produced “traditional” versions of classical Kunqu opera The Peony Pavilion and the more populist Peking opera compilation Mei Lanfang Classics (see: “Road to Rebirth,” NewsChina 042, January 2012). Chen Shi-zheng, who has directed a fulllength 20-hour long stage production of The Peony Pavilion as well as China’s first “rockopera” Journey to the West was the obvious person to place at the helm. “Chen has a broader international vision and esthetic. He might help this opera enter

A real horse is brought on stage

the international market,” said Wang Xiang. “He’s also more likely to be innovative, as he hasn’t worked previously with the Peking opera genre.” Both Chen and Wang were united in their desire to stage a completely new version of Farewell My Concubine. They deemed that producing a “copy of the past” was “meaningless.” In November 2010, Chen’s international team, with foreign staff largely restricted to costume design, multimedia and visual effects, started work. However, the international staff, most of whom had cut their teeth in avant-garde drama, found Peking opera difficult to access. According to Chen, NEWSCHINA I May 2012

Photo by Bai Yu/CFP

The two leads in a traditional production of Farewell My Concubine, June 2009

they watched Mei Lanfang’s version and read plenty of books and visual portfolios on Peking opera and its production design, but “couldn’t understand or be attracted by it. Instead, they felt bored,” said Chen. Chen needed to conquer the “strangeness and distance” between centuries-old operatic style and a modern, internationalized audience. “I was wondering how I could bring a foreigner with no prior experience of Peking opera to feel and understand its meaning,” said Chen. What resulted was a dramatic volte-face in terms of both narrative and visual effects. The play’s leading man, a gallant and stubborn general, loses a decisive battle and has to NEWSCHINA I May 2012

commit suicide after killing his favorite concubine to save her from the approaching enemy. The traditional narrative is slow-burning, the significance of the dialog subtle. In the new version, Chen added visual cues to hint at the general’s fate. Maids in white dresses, symbolic of mourning, a broken mast and an eclipse of the moon were all used as harbingers of death and loss. Meanwhile, the incorporation of kung fu and 3D visual effects also added pace and panache to the narrative. Chen admits, however, that he remained “conservative” when it came to the opera’s core. “We didn’t want the changes to go too far,” said Wang Xiang, revealing that an investor had rejected a much bolder vision when Chen had submitted it. “Farewell My Concubine could be a ‘new Peking opera,’ but still had to be a ‘Peking opera.’”

Hard Landing

Despite his acknowledgement of tradition, Chen couldn’t avoid continuous resistance and criticism of his vision. Often his harshest critics were the performers themselves. Typically trained from a very young age in a very strict way, with punishments meted out for any deviation from an opera’s scripted movement or intonation, few Peking opera performers are open to experimentation with their art. Indeed, some train for a lifetime simply to perform a single role, so minutely specific are the actions and methods of singing.

Chen was unapologetic about gutting the original operatic style to fit with his ideas. He removed many of the gong and drum strikes which typically act as percussive cues for performers as much as music. The strikes that remained had their volume lowered in order to create an orchestral musical atmosphere more akin to European opera. This crippled many performers’ ability to sing their parts. Chen remembers the typical protest: “We haven’t sung this way before, we were not taught to sing this way.” Chen Shi-zheng said that fixed patterns leave little that is fresh for an audience to enjoy. He hoped that performers would let the characters adapt to the new composition. “Following a set pattern is easy and quick,” he said. “Ding Xiaojun, who plays the concubine, said that performing was now exhausting. That’s how it should be.” “Rigid patterns are a disadvantage of Peking opera,” said Wang Xiang. “Performers should have a certain amount of freedom. Mei Lanfang himself created some patterns of his own.” Some of the press were less than enchanted. “The director has only a superficial understanding of Peking opera,” wrote one critic in the Shenzhen Economic Daily. “Where was the novelty? The story is still the same. The meaning and content haven’t really changed. All the so-called ‘creation’ is superficial.” “Next time, when they adapt Wu Song Fights a Tiger, will they bring a real tiger on stage?” quipped a blogger in an online Peking opera forum. In November 2010, Peking opera was listed on UNESCO’s Representative List of Intangible Human Cultural Heritage. To many, the genre is already a thing of the past. “It has become a hobby,” said Wang Xiang. “There should be tolerance for change. There should be pluralism.” Guangming Daily, a Beijing-based State newspaper, supported Wang’s viewpoint. “Greatness lies in capacity,” ran a recent commentary. “A more open attitude should be adopted to facilitate the progress of our culture.” Chen Shi-zheng agrees. He admits that his version might not be perfect. Yet, “when there are a hundred different versions of an opera from a hundred directors, people can expect a breakthrough.”


visual REPORT


angnan County in southeast China’s Zhejiang Province is famous for its cotton recycling industry, valued at US$150 million to the local economy. When the mechanical cotton gin was introduced to the area, family-run looms mushroomed in an unregulated cotton boom. Cotton dust, a byproduct of the industry, finds its way through ventilation systems and into every local ecosystem, from farmland to waterways. Cotton tumbleweeds blow across local roads, and floating clusters of red-dyed cotton waste frequently terrify visitors. In workshops, flying dust particles clog workers’ mouths, noses and ears, causing serious respiratory diseases. Despite all this, the industry remains a popular employment option in this impoverished region.

This exhibition, by photographer Su Qiaojiang, won this year’s China International Press Photo Contest (CHIPP).




Photo by Su Qiaojiang/CFP


visual REPORT




Photo by Su Qiaojiang/CFP


OUTSIDEIN perspectives from within china

Surprising Dandong

Looking North Despite initial appearances, the port city of Dandong, Liaoning, offers much to the tourist and even more to the student of Chinese language and culture. Of particular interest is the city’s unencumbered reflection of China’s relationship with North Korea

Photo by Zhen hongge

By Zach Valenta


n a country with over 100 cities of 1 million or more citizens, travelers might wonder why Dandong (pop. 740,000) continues to prove a reliable draw for domestic and international tourists. Situated on the Yalu River in northeastern China’s Liaoning Province, the city boasts neither a balmy climate nor breathtaking natural wonder. However, this often overlooked city boasts historical significance that belies its modest size. Directly across the Yalu sits the North Korean city of Sinuiju, giving the citizens of Dandong a front row seat for the Korean War, and keeping the city at the heart of SinoNorth Korean relations ever since. The area is also home to the Hushan stretch of the Great Wall, constructed during the Ming Dynasty (1368-1644) as the easternmost rampart of China’s most venerable fortification. A likely first stop for visitors should be the museum to commemorate the Korean War or, as it is officially known in China, the War of Resistance against US Aggression in Aid of Korea. Whatever title you prefer, the museum has much to offer the intellectual tourist curious about history as told from the other side. After scaling a long and imposing staircase from street level, the museum’s antechamber greets guests with statues of Mao Zedong and North Korean founder and Eternal President Kim Il-sung, locked in a stern leftist handshake. Interactive exhibits are nonexistent and the layout simple, but the profusion of news clippings, photos, and war memorabilia (or Maomorabilia) are worth seeing. If you’ve ever had the desire to dress in era-specific Korean garb (and let’s face it, who hasn’t?), head to the massive battlefield panorama upstairs and strike a suitably heroic pose.




Ocean Fresh

Photo by Da Liwa/CFP

Dandong’s most significant landmarks are two bridges with an intimately linked past but divergent present. The older of the two is the duanqiao (Broken Bridge) and the name fits; out of service since the Korean War, its foundations stretch across the Yalu River but the bridge deck terminates halfway. The Communist parties of Korea and China were drawn together after WWII with present-day Dandong (literally, “red east”) established as a vital supply link, making its bridges a prime target for US bombers. These days the only traffic across the Broken Bridge comes in the form of tourists who’ve paid 20 kuai (US$3) to stroll to the edge of the bridge to get a closer look at inscrutable North Korea and inspect shrapnel marks left from the war. Few Chinese cities can claim a non-functioning bridge as a tourist attraction. While zhongchao youyiqiao (The ChineseKorean Friendship Bridge) also sustained damage during the war, it remains intact and continues to connect China with Pyongyang. Army trucks and tour buses roll across at regular intervals, though if you want to take your trip a step further and visit North Korea itself you are advised to arrange travel in Beijing, especially if you are American, and be prepared to pay handsomely for the privilege. The ongoing use of the Friendship Bridge means security is tight, but look out for vendors hawking North Korean currency. Normally it pays to steer clear of big-city souvenirs (Mao watches) but the kitschy fare available here is too hard to pass up—where else can you buy a false passport stuffed with (fake) North Korean money graced with the craggy visage of Kim Il-sung? The best spot, however, to feel as if you’re standing astride both China and North Korea is undoubtedly Jinjiang Park. A few blocks from the city’s main square, the park occupies a small artificial hill. Head up to one of the two pagodas on the peak and get a lay of the land; the eastern view illustrates the gap between Dandong’s newly risen skyline

The Broken Bridge (left) and the ChineseKorean Friendship Bridge (right)

Dandong Korean restaurant

Coming in from the Yalu River, use the park’s pathways to wander downtown; blocks north of the train station feature high-end shopping and cuisine, while Dandong’s older quarter lies due south, concealed behind a gaudily developing waterfront. Not exactly picturesque, the 60s and 50s-era housing nonetheless offers a cozy, more accessible urban setting for those accustomed to the wide boulevards which sever the feng shui arteries of most modern Chinese urban centers. With English speakers a rarity, getting around on foot also offers chances to practice your Chinese or, predicably, Korean. From billboards to local TV programming, Korean phonetics are ubiquitous, as is Korean cuisine, from kaorou (barbecue) to small, gummy Korean pastries. A must-see for foodies is the famous Pyongyang Restaurant, recently relocated to the waterfront, which offers a jaw-dropping aquarium of ultra-fresh seafood served by waitresses in traditional Korean hanbok gowns.

Photo by CFP

River Town

and the low-lying factories of Sinuiju. To the west the Chinese city retreats towards a backdrop of snowy mountaintops. There are more great views along a winding bike trail, and Jinjiang even has an amusement park open during the summer months complete with a small zoo featuring endangered Amur tigers, one of Asia’s largest and rarest predators. Owing to the park’s central location and Dandong’s relatively small size, your best bets for a visit are early morning or dusk; I showed up at 8 AM to find the city’s legions of seniors out in full force. Crowds or no, the park is a worthwhile place to relax, and the trails wind enough to find a moment of quiet, however fleeting, a rarity in China.

Photo by Zhen Hongge

When you’re finished inside, the parade ground behind the museum is dotted with rusting artillery and tanks, their sights somewhat alarmingly trained on a nearby playground.

Statues by the side of the Yalu River commemorating the Korean War

Wall of Fame

The last and most historic sight to see in Dandong is the Hushan Great Wall. Only 30 minutes outside the city proper, getting there is a cinch with a regular bus departing every half hour from the long-distance bus depot; return trips from the wall share the same schedule and fare. In general it’s best to ignore the taxi drivers shouting for your business as you wait for the bus, but keep an eye out for groups of Chinese tourists taking a taxi and you can carpool and get a colorful history lesson from the driver thrown in for free. Upon arrival, leave Hushan’s main gate



Getting Around Denizens of larger cities will be thrilled to find that Dandong’s taxis are plentiful and cheap, with rides during the daytime starting at five yuan (US$0.80). Unlike so many other cities, drivers are friendly and knowledgeable, so if you’re a Chinese speaker be sure to pick their brains. If not, make sure your destinations are written down in Chinese characters, Korean at a pinch, as English is basically non-existent in Dandong’s service industry.

behind for yi bu kua or “one step across,” the narrowest border between North Korea and China, with the two nations separated only by 10-odd meters of languid running water. Resist the temptation to hop across (you never know who might be watching), and instead watch for ragged farmers tilling the earth on the Korean side. From yi bu kua, travelers can follow a path adjacent to the stream or take a short hike up to the wall itself. Bear in mind that the trail requires a bit of stamina and flexibility, though there are handrails the entire length. When you make it up, Hushan’s towers feature excellent views of the North Korean countryside and the river valley. In addition to the wall itself, sightseeing boats can be found a few minutes beyond the roadside exit for Hushan. Boats are also available for rental downtown, but heading upriver gives the traveler the pick of an array of smaller craft able to bring passengers within arm’s reach of North Korean fishing villages. Taking photographs up close is discouraged but seems to be tolerated, but as always, exercise caution and listen to local advice. Be particularly mindful to pick up one of the military-issue full-length coats offered piled up on the dock, especially in winter when the temperature out on the water can drop rapidly as the boat picks up speed. Dandong’s proximity to the Hermit Kingdom makes it a city whose fortunes shift with that of its neighbor. News of broadened eco-

nomic reforms in the DPRK emerged late last year, and a shift in domestic economic policy will have serious ramifications for Dandong. If North Korea plans to emulate Chinese successes with special economic zones like the one currently underway in Rason (bordering China’s Jilin Province), Dandong is in a unique position to take advantage. But more trade means more tourists and a new relationship between Dandong and Sinuiju. Travelers would be best served getting to one of the world’s unique border towns before a third, much wider bridge is constructed across the Yalu, and the city shifts up a gear from third-tier Stalinist charm into secondtier commercial mediocrity.

for any particular store, a code of courtesy is observed to the letter. China’s equivalent to eBay, Taobao has formed an entire culture around its online retail world. The website’s independent lexicon, now known as “Taobao-nese,” and some of its catchier words, such as qin, have even infiltrated common parlance. An example can be found in a suspected attempt at humor in a recruitment advertisement for China’s Ministry of Foreign Affairs in July last year. The ad, posted on its official microblog, ran thus:

“Qin, have you graduated? Any good with office software? Got a driver’s license? We’re recruiting, come check it out!” The style has since been used in a “wanted” post issued by the police, as well as in an automated text message service from a university admissions department. While public approval of offline use of Internet slang varies, with critics bemoaning it as the systematic destruction of language, the popularization of Net-speak reflects how online interaction is a powerful force in the development of China’s cultural trends.

Photo by Zhen Hongge

Getting There Dandong is widely accessible by bus from all major metro areas in the northeast, the closest being the provincial capital Shenyang. There are also daily flights to Dandong serving the city’s out-of-town businesspeople, but these are generally limited. Train and bus travel are the most convenient ways in and out and the respective depots are close to the major hotels.

A Chinese tourist looks across the Yalu River

real chinese

qin dear In China, don’t get your hopes up if a stranger calls you qin, a cutesy contraction of qin’ai de or “my dear”. Lamentably, the saccharine greeting has become an acceptable way for adults of both sexes to address one another, and is no different to saying “hi.” The blame for the popularity of this hot new slang word lies squarely with online retailers. Sellers on Taobao, China’s largest online marketplace, are entirely at the mercy of buyer feedback, and began to use the word as friendly gesture to curry favor with customers. Since a passing comment taken the wrong way may spell doom



flavor of the month

Counting Cartoon Sheep


mong a certain group of friends, the word “hotpot” is routinely used as a sort of casual synonym for winter, an example of which might be, “Ah it’s going to be a real hotpot day tomorrow!” or “Better buy a new coat, it’s almost hotpot season!” Much as people in the US might discuss the onset of a chill winter in terms of “soup weather.” At first, this confused me. Growing up around Taiwanese relatives, I’d always considered hotpot to be light and tangy, something that could be enjoyed all-year round. Then I lived through my first Beijing winter. In northern China, hotpot really is a winter dish. It’s ferociously spicy – the most common variant is the ultra-hot Sichuan style; the atmosphere in restaurants serving this variant are like saunas – you can usually spot one at some distance thanks to the condensation on the windows; the steamy ambience added to by tight huddles of locals with streaming eyes, dipping goodies into sweltering salvers of broth. With this winter relatively mild by Beijing standards, however, the allure of the city’s most-vaunted seasonal winter warmer has inevitably lessened. Mention the idea to friends, and the answer is always the same: “It’s not cold enough yet!” Evidently, a new approach was needed. Step up the ever-present but consistently overlooked “Little Sheep.” Little Sheep is quite literally everywhere. Such is the restaurant’s ubiquity that, like traffic warnings and anti-smoking signs, it often goes virtually unnoticed. Neither is this non-image helped by its choice of signage. It’s hard to take any place too seriously when it employs a cute anthropomorphic lamb as its mascot. It also puts off the squeamish to think they might be digging into some equally adorable animal. But maybe that’s the point. Like other predominately US fast-food chains, Little Sheep isn’t intended to be taken seriously. It’s fun, affordable, and most importantly, not only NEWSCHINA I May 2012

for the harsh winter months. Founded in 1999 in Batou, Inner Mongolia, Little Sheep’s stock (pun intended) has risen steadily in recent years, and now has over 300 outlets throughout China and a further 7 in the US, with its first New York branch opening later this year. In 2011, its revenues accounted for an estimated 2 percent of all dining-out receipts in China. According to a company spokesman, Mongolian hotpot was the forerunner to the modern fondue (although no doubt many Swiss would argue otherwise), and both dishes celebrate the fun in sharing. At Little Sheep, communal eating is central to the restaurant’s layout and branding, and as such the chain is popular with large families and work parties. During my own visit, it was packed to the rafters with young excitable kids and crowds of tipsy twenty-something cubicle zombies. Clean and well-lit, it reminded me of any number of theme restaurants from my childhood. Fortunately, however, that’s where the similarity ended. Little Sheep has placed an emphasis on healthy eating, and unlike many of the regular (read: winter) hotpot restaurants, the main soup or broth (which the ingredients are cooked in) remains light, fresh and non-oily. As too does much of the meat; prime cuts are of noticeably higher quality than those offered in many similarly-priced competing establishments, and as would be expected of a chain featuring the word “sheep” in its title, the mutton and lamb are exceptionally tasty. Seasoned with cilantro and pepper and shredded wafer-thin, the mutton was neither too chewy nor too brittle. The best part of eating hotpot remains the choose-your-own-adventure style setup. With a near limitless plethora of vegetables and accompaniments, everybody is free to select their own menu choices before adding them to the communal broth for simmering. On this occasion we collectively chose a broad variety of green leafy vegetables, spinach,

Photo by Xinhua

By Stephy Chung

cabbage and kale; an assortment of mushrooms, including my favorite needle mushrooms, perfect for soaking up sauces; some staple root vegetables; and an array of fresh white tofu. There’s more fun to be had with the dipping sauces. Promising that all ingredients are MSG-free and using a base of light soy sauce, diners can add an assortment of chilies, minced garlic, roasted peanuts, cilantro and scallions, as well as other savory ingredients to their side dish. The affordability of Little Sheep (a family of four can eat out for under $US30), coupled with its unpretentious, bright, airy and clean décor, will likely see its popularity increase in countries such as the US, where this type of communal dining experience remains something of a novelty. Yet if the company’s owners wish to see the chain really take off, they might want to try and transfer something of the chain’s unique joie de vivre. While noisy and chaotic, one thing it will never be is too closely tied to the long darkness of a northern Chinese winter, reason enough to celebrate.



Expat – or Exile?

Illustration by Xiang Zhaohui

By Robert Foyle-Hunwick

Why are we all here? That’s not an existential question; it’s simply something asked by every single one of those of us who choose (or not, as the case may be) to live abroad. Granted, it’s normally only asked after an exceedingly foul day – beginning with zero-visibility air and ending with a glass of baijiu being hurled in your face – when it’s hard to figure out a decent answer and the question is often couched more in terms of “Why am I here, God – why?” But clearly, it’s one of those questions people need to figure out a proper answer to, like when strangers ask “and what do you ‘do?’” What makes a good answer? The truth, you may think, is fine – unless what do you do is a bottom-of-the-barrel suit job you don’t wish to be “represented” by. Nobody wants people to think they’re an estate agent at heart. The only thing worse, possibly, is a title that roughly approximates your half-imagined dream job – freelance writer, say – but the actual job itself – freelance writer for Concrete World magazine (“When it comes to facts about granite, we’re rock solid!”) – is less than dreamy. In those cases, you can buttress the description with a lame prelude (“At the moment, I’m…”) or epithet (“It’s just for cash, while I’m working on my documentary about the homeless”). Because you are about more than concrete; at least, you hope you are. Therefore what you really need is an askno-further-questions response. President of


the Bundesbank, for example. Embassy attaché. Spy. These “I could tell you, but then I’d have to kill you, or at least sleep with you first” titles have worked wonders for me in the past – with the added bonus that you don’t get tied down to hour-long conversations about work: no one wants to die (or sleep with me, for that matter). For expats, there���s an added annoyance, similar to the “Where are you from? And what do you study?” conversation starter which serves as the ad nauseam bread and butter of every college student in the world. “What brings you to China?” It has to be asked, which makes it doubly annoying. It would be the easiest thing in the world to lay down a smokescreen, yakking about the financial crisis and woeful employment opportunities overseas. Even the most cursory glance at a British newspaper would illuminate the decision to abandon my homeland like the sinking ship it appears to be to all but the most illinformed of outsiders. But although media reports did indeed drive a lot of people, such as me, to emigrate/change career/chew off their fingertips with their relentless, sadomasochistic campaign to convince the world we were all doomed, that’s not the whole story. There were other factors at play – not all, in my case, related to gloomy British weather. It’s simply not possible to give a succinct, interesting answer to the question of why I do what I do here. Thus a convenient answer is required to, at best, neatly segue into more interesting subject matter; at worst, throw the questioner off balance and prevent further discussion. This need was best demonstrated during a bizarre conversation with Roger, a gimleteyed quinquagenarian who’d cornered me at a hotel bar during a night out in Beijing’s Central Business District. As often happens when two people are defensive about their failure to realize their starry-eyed dreams of

Next time someone asks why I’m in Beijing, I’ll simply say it’s for the skiing and the clean air.

exotic and vital work in the Orient, we entered into a strange kind of conversational jousting – our questions and answers barreling into one another like armored knights, each trying to unseat the other and claim our lady’s favor. Roger was trying to outpace me on the bourbon when he pitched a sudden and unwarranted curveball. “Why are you here?” Not, “What do you do?” Not, “How do you find China?” His question went straight for the throat: Why was I here? I should have paused, considered, and responded carefully. Instead I fumbled: “I’d long been fascinated by Chinese culture…” “Exile?” “What?” “Are you an exile?” “No. Nothing like that, in fact. What actually happened was, I’d just finished a job at–” “Exile,” he nodded, a victorious smile appearing upon his wrinkled face. “Can’t go back. Screwed things up at home: now you’re here.” He had me exactly where he wanted me: a conversational cul-de-sac. It wasn’t that I didn’t want to be in China, but it also wasn’t the case that I desperately wanted to be here and nowhere else. I simply was. As, I suspect, he was too. I wish I could say I have come up with a foolproof-ended response to his question to use the next time I’m fenced into a corner. But it haven’t. Next time someone asks why I’m in Beijing, I’ll simply say it’s for the skiing and the clean air. NEWSCHINA I May 2012

Middle Way Management

Illustration by Xiang Zhaohui

By D.V. Verde

“He was young. He was rash. He never learned how to look into men’s hearts, least of all his own.” So said Merlin about the father of a young King Arthur in the seminal 1981 movie Excalibur. It’s a description I could equally use to describe myself when I first entered the mystifying bullpen that is a modern Chinese office. I had no concept of how to build relationships, and often dealt with difficult situations by attempting to bulldoze or blindly argue my way through them, as if I could influence decisions through sheer force of personality. Put mildly, it was not a successful technique. In an office where even relatively nonsensitive topics were discussed in the privacy of MSN messenger, my attempts to make everything an issue that concerned everyone, as if the office was some kind of Roman forum, soon had my position as an outsider cemented. I was by degrees ostracized, until I found that decisions directly concerning my role in the company were being made over my head. In retrospect, this likely seemed a lot simpler than dealing with troublesome me. I was then forced to digest these changes as they were presented as fait accompli, with little or no feel for how they came about. Eventually, I took matters into my own hands and insolently decided to blog about what I viewed as the various failings of the internal workings of the company. These views were then published on an external industry webNEWSCHINA I May 2012

site. In a near perfect realization of the saying “what goes around comes around,” my superiors discovered the blog, which in a fit of hotheaded righteousness I had declined to publish under a pseudonym. I was promptly fired with immediate effect. Even in later roles, where I was given the hazy responsibility of mentoring junior Chinese colleagues, I still had not learned my lesson. I was again too quick to anger, and often called people out publically on their perceived shortcomings, mistakenly believing it would galvanize them. Instead, as is fairly obvious away from the heat of the moment, it made producing the good work we were all striving for more difficult. Older and wiser heads thankfully had the patience to pass this on, and I slowly set about the task of rebuilding some of these relationships. As a Westerner, I was also used to the notion that there are various bureaucratic processes in place, and one should simply be able to slot oneself into these arrangements without too much difficulty. I viewed employer responsibility for my visa being issued in a timely manner as one such process, but soon found I was mistaken. When I demanded some kind of investigation into incompetence in the human resources department, my boss made it clear the matter was out of his hands. I now know I should have invested the time and energy to build a relationship with the person in charge of handling visas to make sure mine was done properly. Or just listened to my boss, who told me that it was unwise to make an enemy of the person responsible for making sure you are paid on time and furnished with the documents that allow you to remain in the country. Given this unenviable track record, it was with some surprise that I found myself catapulted into the kind of mystifying job change that seemingly only occurs in China. Almost instantaneously, I moved from sitting in my underpants wringing my hands about the

Government by consensus – that tried, true and very Chinese approach to office politics.

above litany of schoolboy errors to managing a team of 10 people, both foreign and Chinese. While it has not been an easy transition, my anxiety to avoid the kind of embarrassing face-offs that plagued my earlier career appears to be paying dividends, at least so far. I now operate under a tripartite leadership. The two bosses directly above me both have different spheres of influence, and are honorbound to communicate as little as possible. Both compete for the ear of the supreme leader, who cunningly plays them off against each other to ensure that point-scoring is made as difficult as possible. I am told it has always been thus, and consequently have little desire to try and change the arrangement. Instead, all my energy is ploughed into trying to get things done while avoiding argument and conflict, conceding small defeats so as to have the ammunition and the political goodwill in hand to take a stand on issues that really matter. Government by consensus – that tried, true and very Chinese approach to office politics. Luckily, my day of reckoning has yet to come, but when it does and the dust has settled, I’ll make sure the first thing I do is treat my HR rep to a suitably expensive lunch. 


Cultural listings Cinema

Sweet Simplicity Hong Kong is facing increasing pressure from an aging population. Though veteran director Ann Hui’s latest work A Simple Life is set in one of the city’s crowded retirement homes, she chooses not to focus on the topic, instead narrating plainly the mother-child relationship between an elderly servant and the young “master” (Andy Lau) she has raised. During the short time the old woman spends in the home, the two rediscover their relationship and the beauty of the simple life. One of the most important figures in Hong Kong cinema’s “new wave” of the late 1970s and early 80s, Ann Hui has touched upon a range of important social issues in her movies. Despite their distinctly modest box office income, her works have received strong praise from academics and critics.




Barbed Birds

With the simple title Beijing Post-Rock, an album featuring music by six Beijing-based bands was released in mid-March by local indie label 1724 Records. One of the most popular genres in China’s underground rock scene, post-rock was first introduced to Chinese fans in the early 2000s by pioneering local bands such as Chengdu-based Sound Toy, and Plum Ferry from Taiwan. A rare compilation reflecting the genre’s recent history, Beijing Post-Rock has caught the attention of fans and critics alike, receiving largely favorable reviews so far. However, some pundits have pointed out that despite obvious improvements in technique, Chinese post-rock still suffers from a lack of originality and creativity, a criticism often leveled at bands across China’s rock scene.


River Town (Chinese Edition) By Peter Hessler

One decade after the US release of River Town, American journalist Peter Hessler’s maiden work on China, a Mandarin-language version finally reached readers on the Chinese mainland in early 2012. Depicting his two-year stay in Fuling, a small, remote and undeveloped county along the Yangtze River, the book provides a close-up on the life of ordinary Chinese people, and their mentality when faced with great societal change around the turn of the 21st century. “The real China in Hessler’s book was the China that many young Chinese didn’t really know, or refused to know,” commented the Guangzhou-based magazine Southern People Weekly. Chinese readers have welcomed Hessler’s vignettes of their homeland, giving the book an average rating of 9.3 out of 10 on, China’s largest culture-focused social networking site.


When one of Chinese painter Ye Yongqing’s clumsy, childish drawings of birds sold for 250,000 yuan (US$39,680) in 2010, the artist’s style came under fierce criticism online. Yet Ye continued to draw birds, working his unique barbed wire-like strokes into different compositions, including traditional Chinese landscape paintings and abstract minimalism. The renowned artist’s 2012 solo exhibition, entitled Sparrow God Funky Bird, runs from early March to late May at Longmen Art Projects in Shanghai, and has caused a stir among art critics and collectors. NEWSCHINA I May 2012




On the Chinese Model The Chinese model is not sustainable and liberalization is the only option for China By Liang Xiaomin


f I were to tell you there was a country that maintained an Moderate leftists don’t go quite so far, but they still believe that annual GDP growth of 11.4 percent for six years, a huge poor- the Chinese model, characterized by a powerful state, is the key rich income gap, and a powerful government with no political to solving the existing problems, as the model has brought China opponents, which country would you think I was talking about? three decades of rapid economic growth. Many would probably say China. But the correct answer is Brazil Liberal economists, on the other hand, hold that the Chinese in the 1960s. Back then, this was called the “Brazil model.” China’s model is not sustainable, and China needs to drastically liberalize economic rise shares many similarities its economy. with Brazil in the 1960s, and predictWhat the left fails to acknowledge ably, has become known as the Chiis that China’s economic growth has What the left fails to acknowledge nese model. The question is whether been achieved not through strengthis that China’s economic growth or not the model is sustainable. ening the role of the government, has been achieved not through The Brazilian model did not last but through de-centralization, and strengthening the role of the long. In the decades following the transfer of power to the people. boom of the 1960s, Brazil experiAs a matter of fact, a powerful government, but through deenced serious political turmoil and government is the root of many centralization, and transfer of power economic difficulty. Its total GDP of China’s problems. For example, to the people. growth during the entire 1980s was widespread corruption is a direct almost nil, and the period is known in result of officials wielding too much academic circles as “the lost decade.” power. The lack of innovation in It appears that there is disagreement China’s enterprise is caused by mowithin China regarding the sustainability of the Chinese model. nopoly powers enjoyed by many State-owned enterprises. The funSome laud it, believing it can provide insight to other developing damental reason behind the rising social tensions is that the govcountries. More people, however, believe it is only a transitional ar- ernment has become too powerful, and is infringing upon people’s rangement, and not sustainable. rights. Both the left and the right agree that China is now faced with seThe leftist argument for returning to a socialist planned economy rious problems, such as corruption and a huge wealth gap. But they is backed more by a sentimental nostalgia than rational reasoning. differ on the solutions. Currently, there are three major arguments, Those who argue in favor of the Chinese model tend to be benefiwhich can be found in Crossroads: Where Should China Not Head ciaries of the status quo. The methods they prescribe will lead China To?, a collection of essays written by China’s leading economists, to stagnation, degeneration, and potential disaster. edited by Wei Sen, an economist from Fudan University. The only way forward for China is further reform to bring about China’s radical left (conservative) argues that China’s current a true market economy under meaningful democracy and the rule problems are the result of economic reform and over-commer- of law. cialization, and they claim that China must return to the planned economy era. (The author is an economist from Tsinghua University.)







May 2012