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POLITICS

Labor Pains: Petitioner Freed

Inner-Party Democracy: Behind Closed Doors SCIENCE Atom Boom: Reactors Restarted

US manufacturers are uprooting their China operations and heading elsewhere. Could China’s economy survive a full-blown exodus?

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Volume No. 050 October 2012

SOCIETY


EDITORIAL

Published by China Newsweek Corporation Publisher: Liu Beixian Executive Directors: Liu Beixian, Zhou Jianming Editor-in-Chief: Wang Xiaohui 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: Lisa Gay Address: 5th Floor, 12 Baiwanzhuang South Street, Xicheng District, Beijing, China Post Code: 100037 Tel: 86-10-88395566 Fax: 86-10-88388045 Email: readers@newschinamag.com www.newschinamag.com 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: readers@newschinamag.com Toronto Office Director: Lai Hailong Address: 51 Halstead Drive, Markham, ON Canada L3R7Z4 Tel: 1-905-604-6150 Fax: 1-905-604-6170 Email: canada@newschinamag.com 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, Sun Yuting, Li Yang Washington Office: Wu Qingcai, De Yongjian Los Angeles Office: Zhang Wei San Francisco Office: Liu Dan Houston Office: Wang Huan 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

CN11-5826/G2

NEWSCHINA I October 2012

When You’ve Lost Your Only Child, You Need Help

W

hen the Chinese authorities first for example, each member of the bereaved couple implemented the one-child family receives a 200 yuan (US$32) monthly subsidy and planning policy nationwide in the is entitled to a lump sum of 5,000-10,000 yuan early 1980s, decision-makers probably did not (US$795-1,590) in subsidies when the wife turns expect that it would give rise to one particularly 55 or the husband turns 60. These small sums of grave social problem in later money are simply “betyears – the formation of a ter than nothing,” and can group of people who have hardly be expected to help Many parents who have lost their only children in with bereavement. lost their only children, fatal accidents or to terminal The even bigger challenge now approaching their illness. Bereavement leaves to the government is to prosenior years, are in this group of ageing people vide life-long and compredesperate need of aid helpless and isolated. This hensive care for this group from the government and is a social phenomenon of elderly people. Parents unique to China. with adult children can desociety The family planning polipend on their offspring, but cy has functioned effectively those without children can in terms of slowing down population growth in only count on support from the society and the China. Statistics show that the implementation of government. It is thus imperative for the country’s the policy over the last three decades has made the family planning and civil affairs authorities to take current Chinese population 400 million smaller urgent action to deal with the situation. A social than it could be. Meanwhile, the first generation of welfare and health insurance umbrella covering one-child parents is now stepping into their retire- these parents should be introduced. Meanwhile, a ment. Experts estimate that there are currently at society-wide elderly care mechanism should be put least 1 million families across the country that fall in place for this group of senior people, by mobiinto the category of bereaved single-child families, lizing all social resources including those of charity and each year, 76,000 more are added to this list. and philanthropic organizations, which would be According to statistics from the Beijing Family expected to make up for the limited capability of Planning Association, by May 2012, there were a the government in this regard. total of 7,746 people in the municipality who have Media reports show that in Beijing some atlost their only children, of whom 1,267 are rural tempts have been made by communities to set up residents and 6,477 live in cities. In urban areas, the projects for offering emotional support to bereaved social security and pension systems are relatively parents so that they can begin to cope with grief as complete and effective. The corresponding systems soon as possible. in the countryside, however, simply cannot provide In the final analysis, the responsibility of addressfor this group in their old age. ing this issue rests with the government. Miao Xia, The loss of an only child is a devastating blow. an official at the National Population and Family Providing social security and psychiatric care for Planning Commission, once told the media: “If this kind of family is an unequivocal duty of the we fail to resolve this problem, we are letting the government and society. Thus, in August 2007, the people down.” government launched a special support scheme to Both the government and society at large should help precisely these families. Under the program, face up to the existence of this group of people and which was first put on trial in 10 provinces and cit- perfect various social security systems so that these ies before it was promoted nationwide, a monthly elderly people are well provided for, while their subsidy is given to couples over 49 years old who emotional suffering is minimized. have lost their only child, and the financial support This is a question of social stability, which will will continue until the couple’s death. In Beijing, determine the values of a nation.

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Contents

Reshoring and the lure of cheaper pastures is taking outsourced manufacturing jobs back out of China. Is it time for the world’s factory to knock off?

Editorial

01 When You’ve Lost Your Only Child, You Need Help politics

10 Inner-Party Democracy : Behind Closed Doors

Cover Story

international

society

12 HOME ADVANTAGE: Factory Flight/Play to Your Strengths

P53

22 Diaoyu Dispute : Pride and Prejudice 26 28 30

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Beijing Floods : Freak of Nature? Rape Scandal : Police the Police Index Dispute : Rejuvenation in Progress

P46 NEWSCHINA I October 2012

Photo by CFP

Home Advantage


Contents

P22

P34 32 Business Strike : Shop Cops

ENVIRONMENT

34 Conservation : LAST RESORT economy

38 40

LED Industry : Dusk of a Dawn Finance : Bringing the Offshore,Onshore

SCIENCE

visual report

42 Nuclear Restart : Willing, Yet Unable 46 Mahjong- Vice or Vocation? sports

50 53

Olympic Champions : Whose Medal? 2012 Olympics : Faded Gold

NEWSCHINA I October 2012

P56

culture

56 58

Electronic Music : The China Beat 3D Painting : Illusions of Grandeur

HISTORY

61 Zhumadian Flood Disaster : Dams in Distress

P70

outside in

64 67

Lazy Nanjing : Songs of Indolence and of Experience Flavor of the Month : Curl Up and Dai

04 MEDIA FOCUS 05 What They Say 06 NEWS BRIEF 08 Netizen Watch 45 China by numbers 66 real chinese 68 ESSAY 69 CULTURAL LISTINGS 70 Commentary

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NewsChina Chinese Edition

China Economic Weekly

August 13, 2012

July 31, 2012

Liu Xiang, Still Standing?

Who Pays for Losses?

As in Beijing in 2008, China’s star athlete Liu Xiang fell at the first hurdle in London – this time in the heats – once again leaving Chinese sports fans devastated by the ongoing effect of injuries on the country’s leading figure in track and field. In the wake of his ignominious exit in London, some have questioned the country’s wisdom in continuing to invest in Liu, with some netizens accusing him of deliberately throwing a race he knew he couldn’t win. Others struck back against Liu’s critics, arguing that his failure to perform in London shouldn’t eclipse his success in other international competitions since 2008. Expectations seem to have forced Liu to promise he will go on to compete in Rio, leaving fans concerned that he may risk further injury simply to appease the media and his critics.

Lured by huge profits, the government of Xinyu, Jiangxi Province sank a huge amount of public money into Asia’s largest solar cell manufacturer LDK Solar, only to find the company shackled with US$6 billion in debts due to the collapsing international market for solar technology. On July 12, the government announced a US$73 million subsidy to be paid directly to LDK in a bid to avert the collapse of Jiangxi’s biggest corporate tax contributor and safeguard two million local jobs. However, this temporary solution will only work if a buyer can be found soon, and with investors quitting the solar industry left, right and center, Jiangxi may have to face up to its misguided industrial policies.

Century Weekly August 8, 2012

Appliance Price War China’s three leading suppliers of home appliances, Suning, Taobao and 360buy, launched a price war in August. Analysts attributed the action to China’s sluggish capital market, with all three giants struggling to attract financial backing. Experts claim that 360buy needs money to expand its operations to allow the company to go public, while Suning needs a capital injection into its flagging online business. Customers, however, were allegedly turned off by the price war, with many complaining that they had no way to check prices against those posted by competing stores. Analysts said as e-commerce in China moves incrementally towards a B2C model prioritizing logistics, service and product quality over price, consumer loyalty will be determined by more than price cuts.

Xinmin Weekly July 23, 2012

Chinese Tea Boiling Over A recent report by Greenpeace has revealed that six of 18 samples of Chinese tea taken from nine popular brands have been proven in laboratory testing to contain residue from over 10 types of pesticides, with 11 samples found to contain insecticides banned under international agricultural law. The China Tea Marketing Association responded that the samples tested conformed to China’s domestic standards, arguing that without pesticides, some 70 percent of China’s total tea crop would be damaged by insects. As of 2010, China had banned the use of 42 types of pesticide on tea plantations, but has not yet ascertained these chemicals’ potential impact on human health, leading many farmers to ignore the ban.

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Vista August 13, 2012

Costly Ad Zhang Yimou, the world-renowned Chinese director, drew fire from domestic media after the National Audit Office revealed that a five-minute promotional film the auteur had directed for the Ministry of Railways in 2010 had cost US$2.9 million, a flat rate quoted by Zhang’s commissioned production company that was never opened for bidding. Given that national auditors claim that similar promotional films should cost no more than US$1 million, the Audit Office is investigating whether the extra cash was spent on kickbacks. Although Zhang argued that he only received a fee of US$370,000, and denied knowledge of any kickbacks, he has been roundly criticized for his profit-oriented approach to filmmaking. NEWSCHINA I October 2012


Illustration by Wu Shangwen

“In the Internet era, nobody will stay stupid for five seconds – your competitors will soon wake up.” Ma Huateng, chairman of the Chinese Internet giant Tencent, warning market leaders of a coming surge of interest in his company’s field. “If your car gets stuck in heavy rain … you may be in a‘developing’country which has money to build skyscrapers, but has no intention of improving its sewage system.” Taiwanese writer Lung Ying-tai in her book In Europe.

“What I write on my microblog is pointless, as what I want to write is forbidden. I feel guilty for not speaking from the heart.” Meng Fei, a popular anchor with Jiangsu TV, on the limitations of China’s online environment.

“Liu Xiang is now a son of the country, who will not come back to me until the end of the Olympic Games. If Liu Xiang is someday no longer outstanding, please forgive him.” Ji Fenhua, mother of hurdler Liu Xiang, on her son’s disappointing exit from the London Olympics.

“Being a Party member will inspire Sun Yang to fight on the Olympic battlefield.” Olympic swimming coach Zhang Yadong explaining why China’s 200m freestyle and 1,500m freestyle gold medalist was inducted into the Party prior to departing for the London Olympics. NEWSCHINA I October 2012

“The economic tide has swept away something more essential – it is quite awful that people live for the prospect of riches.” Philosophy professor Li Chenyang from Nanyang Technological University, Singapore, on moral decay in the Chinese diaspora.

“I think the root motivation for corruption is the realization of personal value. People only bribe those in power, so the more you are bribed, the higher your value.” Wang Naiping, former president of the Guangxi University of Chinese Medicine, during his trial. Wang was found guilty of taking bribes worth two million yuan (US$294,000) and was sentenced to 12 years in prison.

“On the world stage, the Chinese government has a loud voice, while the Chinese are kept quiet.” Communications Officer of the United Nations Development Programme (UNDP) China Zhang Wei, during a promotion for the UNDP video 2032, I Hope, in which 232 ordinary Chinese describe their wishes for the future.

“When charitable organizations are neither independent from the government nor open to the public, real charity is to refuse government calls for donations. If the government can make a profit whenever a disaster occurs, it will be inactive in disaster prevention, or even hope for disasters.” Critic Lian Yue’s response to requests from the Beijing government for citizens to donate money to the relief effort after the July 21 storm which killed 77 people in the capital.

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Top Story

Gu Kailai Sentenced Gu Kailai (named Bogu Kailai in Xinhua reports for undisclosed reasons), wife of former Chongqing Party secretary Bo Xilai, was sentenced to death with a two-year reprieve for the murder of British businessman Neil Heywood. The verdict was passed on August 20 by the Intermediate People’s Court of Hefei, capital city of eastern Anhui Province, far from Bo Xilai’s base of power. More than 100 people were in attendance, including family members and friends of the defendants, diplomats from the British embassy and consulates in China, journalists from various State media, deputies from the People’s Congress, (China’s legislature) and members of the People’s Consultative Conference (China’s political advisory body). Legal representatives of Heywood’s family were also present but foreign journalists were not permitted to attend. During the proceeding, which was later televised, Gu Kailai confessed to the murder charge against her, claiming that her crime was perpetrated out of fear for the safety of her son, Bo Guagua. According to Gu, Heywood had “threatened” her son in e-mails after a “conflict” between Bo Guagua and Heywood over a property deal. According to Gu’s testimony, on November 13, 2011, she invited Heywood to a vacation resort in Chongqing, joining him in room 1605, with an “orderly” named Zhang Xiaojun, also standing trial, in attendance. Gu recounted how she and Heywood had drunk liquor together until the British man became severely intoxicated, “slipping and falling” in the suite’s bathroom. Gu called Zhang to help her get Heywood into bed, whereupon, according to her confession, she force-fed him cyanide. Zhang Xiaojun was sentenced to nine years in prison as an accessory to murder. Neither defendant will appeal. Gu pleaded guilty and described the verdict as “just.” The judge decreed that Gu, though capable to assume full criminal responsibility for her actions, had suffered from a “mental disorder” which weakened her self-control. In recognition of her cooperation with the investigation,

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Gu was granted leniency. The court also sentenced four Chongqing police chiefs to five to 11 year prison terms for covering up Heywood’s murder by “counterfeiting, concealing and destroying evidence.” The Chongqing police had initially concluded that Heywood’s death had been due to alcohol poisoning. Heywood’s body was hastily cremated a few days after he died. Allegations of foul play surfaced when Wang Lijun, Chongqing’s former police chief, entered the US consulate general in Chengdu, a city close to Chongqing, “without authorization” on February 6, 2012, four days after he was removed from his post as Chongqing’s police head amid rumors of corruption. On March 15, Wang was removed from his post as Chongqing’s vice-mayor. That same day, Bo Xilai, Wang’s former mentor and Gu Kailai’s husband, was removed from his post as the city’s Party secretary. An inquest was launched into Heywood’s death, and it was announced that he had, in fact, been murdered, with Bo’s wife

named as the prime suspect. With Gu having escaped the death penalty, focus has returned to Bo Xilai and Wang Lijun, both of whom the Party has stated are “under investigation,” though their precise fate and whereabouts remain a mystery. Officials have declined to comment on what charges, if any, the two might face, and the lengthy Xinhua summary of Gu’s trial made no mention of her high-profile husband. According to one report by the Hong Kong-based South China Morning Post, Wang Lijun is expected to face charges of treason in a Chengdu court, though city officials denied any knowledge of such plans.

Business

CNOOC Postpones Nexen Purchase China National Offshore Oil Corporation (CNOOC), China’s biggest offshore oil producer, announced August 12 its intention to postpone confirming details of its purchase of Canadian upstream oil giant Nexen to its shareholders. Notification was scheduled to be given on August 13, 15 days after CNOOC announced its plan to purchase all of Nexen’s circulating ordinary shares for US$15.1 billion. Analysts believe the main reason behind the postponement is opposition from the US, which insisted that CNOOC should not exploit Nexen oilfields located on US soil without paying additional fees to the US government. Insider trading is believed to be another cause. The US Securities and Exchange Commission exposed that Zhang Zhirong, founder of Rongsheng Heavy Industry, a business partner of CNOOC, allegedly made a US$7.2 million profit from the purchase. Yet, according to the media, CNOOC is confident it will receive final approval from the US and Canadian governments by the end of this year. It is estimated that the purchase, if successful, will increase CNOOC’s annual output by 20 percent. NEWSCHINA I October 2012


Reform

Society

Hong Kong-style Hospital Up and Running in Shenzhen

Armed Robber Zhou Kehua Shot Dead

The University of Hong Kong-Shenzhen Hospital, the first Hong Kong-style hospital on the Chinese mainland, was put into trial operation this July. Costing a total of 3.5 billion yuan (US$510m) to build, the hospital is believed to be Shenzhen’s latest effort to offer an alternative to China’s profit-oriented medical system. The trial operation will last one year. What’s Different?

Mainland: No general practitioner. Charges vary between specialists.

Hong Kong: Doctors are recruited with competitive welfare packages (US$150,000 per year at most) in exchange for committing to a strict code of discipline. Mainland: Doctors earn US$14,000-28,000 per year, with some having unknown “gray income.”

Hong Kong: Appointments in advance are designed to reduce lines.

Mainland: Patients have to queue up for registration several hours in advance, or even camp outside the hospital for a night.

Statistics

Blogs Take the Lead on Whistleblowing Online media, including microblogs, Web forums and news portals, have been playing an increasingly important role in exposing scandals, says the Blue Book of Social Opinion – Report on China’s Social Opinions and Crisis Management (2012), issued on August 18. According to the report, compiled by the societal opinion research lab of Shanghai Jiaotong University, of a sample of 471 scandals that happened in 2011, 307 were first exposed by online media, accounting for 65.2 percent of the total, while those first exposed by traditional media only occupied 30.8 percent. The book places particular emphasis on the rapid development of microblogs, revealing that 20.3 percent of scandals in 2011, including the tragic Wenzhou rail crash on July 23 and the corruption scandal surrounding the Red Cross Society of China, were first made public on microblogs. Before 2010, that percentage was zero. NEWSCHINA I October 2012

Online media (including microblogs, Web forums, news portals, etc.)

Scandal Exposure: Who Got There First?

30.8%

Traditional media

65.2%

Others

Top Four Scandalexposing Media: Web Forum: 14.3% (66)

4%

Number of 1000+ Search Hits Relating to Scandals (2007-2011)

Microblog: 20.3% (94)

2007

Newspaper: 24.7% (114)

2008

News Portals: 24.9% (115)

2009 2010

Source: Blue Book of Social Opinion – Report on China’s Social Opinions and Crisis Management (2012)

2011 0

100

200

300

400

500

Zhou Kehua, a 42-year-old serial killer, was shot dead by Chongqing police on August 14, four days after robbing two people outside a local bank, leaving one dead and the other injured. The gun battle broke out in the early morning after the police spotted Zhou in a town near Gele Mountain where he was thought to have been hiding. The police tracked the suspect down and opened fire after Zhou allegedly pulled a gun. Zhou died from four gunshot wounds. A DNA test later confirmed that the dead man was indeed Zhou Kehua. One of China’s most wanted criminals, Zhou Kehua, according to police, had committed 10 cases of violent crime since 2004, most of which involved armed robbery, leaving 10 dead and six injured. China officially banned private gun ownership in 1966.

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Photos by CFP

Hong Kong: Consultation and treatment fees are unified to 130 yuan (US$19) per person. Each patient is sent to a general practitioner for initial diagnosis before being referred to a specialist, if necessary.


What’s Amusing China? A woman was found floating unconscious in a river in Wenling, Zhejiang Province August 12. The woman, surnamed Zhang, reportedly had a fight with her husband before swallowing 20 cold and flu capsules and storming out of their home. The medicine made her dizzy and she apparently stumbled into the river before losing consciousness. Netizens joked that Zhang’s plump physique had saved her life by keeping her afloat, while Zhang herself reported no memory of how she had ended up in the river in the first place.

What’s Shocking China? A boy from Anhui Province allegedly sold a kidney to pay for an iPad 2, in a case which commentators argue highlights both the spread of rampant materialism and commercial organ harvesting in China. The 17-year-old high school student, surnamed Wang, found a middleman willing to purchase his kidney on the Internet in late April of last year. He collected 22,000 yuan (US$3,461) after the surgical removal of his kidney, money which he promptly spent on a laptop and an iPad. Nine suspects, including the middleman and surgical staff, were arrested in connection with the case.

What’s Surprising China? A gang of suspected thieves arrested in Tengzhou, Shandong Province were lauded by netizens for sticking to a “Robin Hood” principle of only targeting government offices and avoiding private households. According to police, the gang had committed 29 burglaries across four provinces over the past six months. Government officials were allegedly reluctant to report thefts from office buildings after a recent series of corruption scandals were exposed when government employees reported the theft of expensive items from their homes which were far more valuable than the victims could have afforded on a government salary.

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Poll the People What do you think of Liu Xiang’s exit from the London Olympics? Respondents: 42,215 0

10

20

30

40

50

Shame! He is supposed to be the champion! 5,098(12.1%) Shocked! Can’t believe it happened again! 3,189(7.6%) Wish him a speedy recovery! 19,686(46.6%) Lots of respect. Medal or no, he’s a hero! 23,841(56.5%) Don’t know. 6,559(15.5%)

Source: www.weibo.com

Most Circulated Post Retweeted 273,283 times

This eerily-prophetic post was released more than 10 hours before Chinese star hurdler Liu Xiang’s disastrous exit from the London Olympics.

In my dream last night, Liu Xiang fell at the first hurdle and got injured. Then, to avoid the criticism he got in 2008, he hopped to the finish line.

NEWSCHINA I October 2012

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Top Five Search Queries On

Over the week ending August 19 Zhou Kehua 2,365,107 Chongqing police claimed on August 14 to have shot and killed a serial killer who had murdered and robbed 10 people in eight years. Liaoning Anthrax Outbreak 329,620 Seven cases of the deadly disease were reported in Liaoning Province.

WHO’S

HOT? WHO’S NOT?

Diaoyu Islands 649,127 14 Chinese citizens were detained and deported by the Japanese government after they landed a boat on an island chain controlled by Japan but claimed by both countries.

Most-Badass Roadster 118,080 Wang Jian, a 28-year-old man from Jiangsu, built his own Lamborghini out of steel pipes and scrap auto parts at a personal cost of 60,000 yuan (US$9,440). Wang will reportedly use the vehicle to transport fertilizer.

Top Blogger Profile Li Chengpeng Follower: 5,913,665 by August 20 Li Chengpeng, nicknamed “Big Eyes Li” is a former soccer journalist. The 44-year-old, from Chengdu, Sichuan Province, is now a popular blogger and satirist, whose career was launched when he reported on the match-fixing scandal in China’s soccer league which saw a huge number of officials jailed and fined this year. His latest novel, Li Kele Fights Demolition, shed light on the sensitive issue of forced evictions during the demolition of homes. An outspoken critic of the government, Li, along with several other activists across China, ran for a seat on his local people’s congress as an independent candidate but, along with all other independent candidates, failed to gain a seat. NEWSCHINA I October 2012

Part of the pictures used in this section are from the internet

Phosphates in Instant Noodles 128,861 Allegations have been made that excessive use of phosphates in the packaging of a number of well-known instant food brands poses a health risk to consumers.

Changsha Nanny Wei Xingyu, a new father from Changsha, Hunan, alarmed by ongoing scandals involving toxic Chinese baby formula, keeps five dairy goats to ensure a safe supply for his baby.

Expressway Boy Wu Xiaofeng, an 11-year-old from Fujian, ran away from home and walked 150 kilometers of highway in 11 days before being found and returned home. Wu allegedly ran away as his father had given him too much homework over the summer.

Poker President Yang Wei, the president of Zhejiang University, was snapped playing poker on his laptop during an official conference.

Plane Stoppers More than 30 passengers sat on a runway to protest the delay of their flight at Kunming airport in Yunnan Province. The protest caused the cancelation of four flights and the delay of another six, drawing criticism from netizens and other travelers. 9


politics

Inner-Party Democracy

Behind Closed Doors As various initiatives to implement inner-Party democracy creep upwards from the village level, many are looking towards this year’s upcoming leadership transition to validate nationwide political reform By Zhao Jie and Yu Xiaodong

I

n the run-up to the 18th Party Congress this fall, where the Party is expected to unveil China’s new leadership, greater democracy within the Party’s 80-million strong membership is seen as the most likely answer to popular calls for political reform. Some even speculate that even the shortlist of candidates for seats on the Politburo, the country’s top political body, could be significantly longer than the list of available positions, a dramatic change in the selection process for the Party’s paramount leaders.

Bottom-up

Considered manageable in scale and incremental over time, inner-Party democracy is widely considered preferable to full-blown multi-party elections by China’s powerbrokers. Officially declaring inner-Party democracy as “essential to the Party’s vitality and survival” during the 17th Party Congress in 2007, the Communist Party of China (CPC) has attempted to introduce a greater level of political participation at its lowest levels. In 2008, Chongqing municipality permitted multiple candidates to run for county-level posts in a number of districts, though only county-level Party officials were permitted to vote. In Nanjing, the city government boasted that it was the first to implement multicandidate elections for all village-level Party posts. According to official data, 11,267 candidates competed for around 2,500 village-level Party posts in 2008. Since then, such experiments have been rolled out at higher levels. In October, 2009, the Zhejiang government allowed multiple candidates to run for the position of Party chief in Changxing, one of the region’s counties. After two rounds of voting, 28-year-old Wang

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Jianfeng won the election with 76 out of 132 votes cast by Party cadres, making him the de facto leader of a county with a population of 600,000, giving an indication of the narrow voting pool even in China’s most “democratic” areas. One year later, in October 2011, the central bureau of the Ministry of Public Security, China’s police force, introduced multi-candidate elections for twelve official posts, making it the first central government agency to formally elect officials. Barely weeks later, on October 29, 2011, Politburo member Xi Jinping, the man expected to be the Party’s next general secretary and the country’s president, urged the Guangdong government, often seen as a trailblazer for political reform in China, to push forward with touted experiments in inner-Party democracy. With the endorsement of central leadership, Guangdong introduced multi-candidate elections to decide the directorship of eight provincial-level government departments in March this year. It has been reported that there are at least six candidates for each post, each of whom is required to withstand four rounds of voting, a right restricted to the 13 standing members of the provincial Party committee. In May, the provincial Party standing committee, which, along with all standing committees in China’s provinces had to undergo a leadership reshuffle before the 18th Party Congress, saw 14 candidates compete for 13 available posts. In August, the Guangdong Party committee issued three decrees “allowing Party committee members at all levels to play a bigger role,” further stipulating that “important matters” and the appointment of Party cadres in “key positions in all provincial agencies” should be done by an anonymous ballot among NEWSCHINA I October 2012


their underlings who to vote for. Most crucially, genuinely influential positions are never opened to competitive voting. For Professor Zhang, the problem lies in the “fundamental differences between election and appointment.” “If there is no change in the investiture of power, it is inevitable that Party leaders will intervene in election processes in one way or another,” he told our reporter. Zhang went on to say that a prerequisite of legitimate multiplecandidate election is a transparent process. All examples of inner-Party democracy have involved closed-door elections presided over by Party leaders themselves. According to the the Organization Department of the Party Central Committee, more than 15 percent of 2,270 Party representatives to the 18th Party Congress are directly elected by cadres, however the details of the election process remain obscure.

Photo by CFP

Wrong Direction?

Party members in Nanshan District, Shenzhen, Guangdong, nominate candidates for the district’s Party regresentatives to the 18th Party Congress on November 19, 2012

extant members of the relevant provincial Party committee. While minute in scale, this experiment marks the highest-level endorsement of any form of election in CPC history. Some now speculate that this is the beginning of widespread adoption of more democratic processes at all levels of the Party, from the grassroots to the highest echelons of leadership. But what would the impact of such reform actually be?

‘Unwritten Rules’

After Guangdong issued its decrees endorsing experiments in inner-Party democracy, our reporter called up the directors of various provincial agencies, including the local publicity department and discipline inspection commission, the Party’s internal regulatory body. When asked about the new decrees, all the officials we spoke to said they were either “unaware” or “unclear” about them. “It is an important step in the right direction, but without a welldesigned system, it may end up a sideshow,” said Zhang Changming, associate professor of the Guangdong Party School. In the past years, almost all pilot programs in inner-Party democracy have claimed to be either “unprecedented” or a “breakthrough.” However, few have led to meaningful political reform, and only the initiated know precisely how these “elections” work. According to Professor Gao Xinming from the Central Party School, the outcomes of inner-Party elections are often influenced by “unwritten rules.” Most pundits believe the selection processes to be effectively rigged, pitting unknown or politically weak candidates against the obvious Party favorite. Party leaders have ample opportunity to voice support for their approved candidates, effectively telling

NEWSCHINA I October 2012

Many have questioned the Party’s whole approach toward innerParty democracy. In his widely-cited article Whence China’s InnerParty Democracy?, published in Singapore’s Chinese-language Lianhe Zaobao on May 29, 2012, Zheng Yongnian, director of the East Asian Institute of the National University of Singapore, pointed out that the fallacy of equating democracy with voting. “Inner-Party democracy means far more than merely casting a vote,” he wrote. Zheng also rejects the notion that bottom-up reform can ever be effective. He claims the CPC actually introduced inner-Party democracy as early as the 1980s. In 1987, during the 13th Party Congress, members of the Politburo were directly elected by officials. Deng Liqun, perceived to be a political hardliner, failed to claim a seat. Afterward, Deng admitted defeat to his peers and quietly bowed out of politics. According to Zheng, this set up a precedent, since until the late 1970s, transitions of power at the top levels of China’s leadership had been awash with purges, arrests and infighting. But since 1987, no top leader in China has been elected by their peers. While lauding the limited development in inner-Party democracy in recent years, Zheng also argues that relevant reforms are both too timid and also headed in the wrong direction. In an earlier article published in 2010, he stressed that inner-Party democracy should begin at the national level, rather than in the provinces and counties. “Inner-Party democracy is a means to boost the Party’s legitimacy,” commented Zheng. “But when political legitimacy of lower levels of government is increased while that of the central authorities remain static, it poses a political challenge to the center… and may lead to populist chaos .” As the 18th Party Congress approaches, and the country holds its breath for the anticipated leadership transition, political observers are wondering if the Party’s most powerful men and women will be selected by their peers, as in 1987, or appointed by powerful patrons, as is the norm. As with all processes by which the Party selects its leaders, the process of determining China’s next leaders will likely remain shrouded in secrecy. At a press conference on August 14, Wang Jingqing, vicedirector of the Organization Department of the Party Central Committee told the media that multi-candidate voting will be applied in the selection of the new members of his office. When asked how the Politburo’s new members would be selected, Wang’s answer was short, and to the point. “I don’t know,” he said. 

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HOME ADV NEWSCHINA I October 2012


VANTAGE NEWSCHINA I October 2012

With costs rising in China, and falling at home, US manufacturers are looking into alternatives to China outsourcing. What happens if the rug is pulled out from under the manufacturing industry, lynchpin of China’s economy?

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cover story Manufacturing Exodus

Factory Flight With American multinationals rethinking their global production strategy, China may no longer be their favored destination By Li Jia

They should take all the uniforms, put them in a big pile, burn them, and start all over again,” US Senate majority leader Harry Reid told reporters, following the revelation that US athletes would wear Chinese-made Ralph Lauren uniforms at the opening ceremony of the 2012 London Olympics. Dayang Group, a manufacturer based in the port city of Dalian, northeast China, made the Ralph Lauren uniforms worn by Team USA at the Beijing Olympics in 2008. The company was happy to pick up the contract for London 2012. The group’s in-house fashion label, Trands, has many prominent American clients including Warren Buffett and George W Bush. With rising political pressure over outsourcing to foreign countries, especially China, companies like Dayang should brace themselves for the loss of at least some of their orders from across the Pacific. “Ralph Lauren promises to lead the conversation within our industry and our government to address the issue to increase manufacturing in the United States. We have committed to producing the opening and closing ceremony Team USA uniforms in the United States that will be worn for the 2014 Winter Olympic Games,” said a July 13 statement on the company’s website. A few days later, US Senator for Ohio Sherrod Brown proposed a bill to revise the Buy America statute so that any apparel bought by the federal government would be made entirely in the US, compared with the 51 percent mandated in the current bill. In his State of The Union Address early this year, President Obama vowed to give tax breaks to businesses, but he said that those moving production out of America shouldn’t get them. Relocation of production from China to the US, or to other cheaper alternatives, actually predates this recent debate. A number of companies in various industries have left China. Although the scale of the trend remains small, and the likelihood that it will grow is debatable, policymakers and industry insiders in the world’s two

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NEWSCHINA I October 2012


major manufacturing powers are paying close attention. Carrots and sticks from US policymakers are not the only forces pushing American production out of China – commercial considerations are more likely to blame.

Photo by Richard Vogel /AP

All Range

Workers at a Nike factory on the outskirts of Ho Chi Minh City, Vietnam, assemble shoes

NEWSCHINA I October 2012

The US industrial multinational giant General Electric announced in a statement on June 27, 2012 that thanks to stronger than expected sales, it wanted more workers than planned for its newly installed production facilities in Louisville, Kentucky. This was part of GE’s US$1 billion investment to “upgrade all its product lines and create new factories for products not previously made in the US,” creating 1,300 new jobs in the US by 2014, according to the statement. One of those products is an energy-efficient water heater previously made in China. Longaberger, a supplier of handmade baskets based in Columbus, Ohio, declared on July 27, 2012 a plan called “Project Eagle,” aimed at making itself a “completely American-made company again” within a few years. From the early 2000s, it began to outsource its production overseas, including to China. “I believe Longaberger can be a beacon [for this reshoring trend],” said the company’s CEO Tami Longaberger, in the press release. The wide range of names said to be bringing their production back home shows that companies across the board are thinking along the same lines. They include, to name but a few, Caterpillar, Starbucks, Chesapeake Bay Candle, and NCR, the world’s leading ATM manufacturer. In 2011, the utilized foreign direct investment (FDI) in China reached a record high at US$116 billion as a result of a 9.7 percent year-on-year rise. Simultaneously, the amount from the US plunged 26 percent. Over the first half of 2012, the utilized FDI from the US was down by a further 3.2 percent, more than the 2.96 percent and 2.79 percent declines in the national total and the total FDI from the 10 major Asian economies, respectively. In addition to those already reshoring, many American companies are moving to other countries. For example, Vietnam replaced China as Nike’s biggest production base in 2010. Brazil, India, Mexico and African countries are also increasingly attractive to American companies seeking to outsource overseas. Jing Xiujuan, a Guangdong-based staff member responsible for sourcing at Foxconn, a Taiwanese company supplying Dell, Apple and number of other international electronic giants, told NewsChina that the company is finding the wild fluctuations in overseas orders difficult to handle. She believes it is because their clients are diversifying their production locations around the world, and facing a more volatile market situation in the current economic instability. A survey by AlixPartners, a consultancy firm

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Change in US direct investment on manufacturing in China on a historical cost basis (US$m, assets and liabilities at their book values) based in Texas, shows that when seeking alternatives to Asian production bases, American companies prefer Mexico to the USA.

Why Leave?

Among all the reasons that have been given by analysts so far, China’s rising labor costs are the main culprit. According to the National Bureau of Statistics, the price-weighted average wage of employees in the urban private sector rose by 12 percent in 2011, and the monthly salary of migrant workers, the bulk of the labor force in the manufacturing sector, soared 21 percent. The China Manufacturing Competitiveness Study 2011 issued by international consultancy Deloitte shows that the cost of labor in some Southeast Asian countries is “only about half of that in China.” The American Chamber of Commerce in China (AmCham China) has also identified rising expenses, including “land, rent, raw materials and transportation.” 89 percent of AmCham China’s members responding to its annual survey in 2012 said that rising costs are undermining China’s manufacturing competitiveness. The AlixPartners report has mentioned that shipping costs of resourcing overseas have been pushed higher by more expensive fuel, making production in faraway places like China less attractive. On top of all these visible factors, there are also invisible ones involved in the calculation of cost structure. Arthur Kroeber, managing director at GK Research & GK Dragonomics, thinks that for brand owners, the shorter-than-ever life cycle of fashionable clothing and certain electronic devices has increased the importance of being closer to customers or suppliers. He explained that proximity to suppliers allows for quick turnarounds on new products. Tim Cook, CEO of Apple, has already mentioned the possibility that more Apple products will be made in the US, according to Reuters. The products that are most likely to return home are complex highend machinery and automated equipment, according to Mr Kroeber. Manufacturing of this kind is in low volume, high value and with much customization – areas in which China’s manufacturing sector is not currently strong. Moreover, the high standards involved in this kind of manufacturing require that brand owners have strong control of the production process, which is very difficult from afar. Local governments in the US are competing to provide favorable treatment to encourage companies back onshore. GE has already received US$17 million in tax breaks from the state and local government. With no lack of choices or incentives, it seems clear that American businesses are not taking made-in-China for granted. Just how much momentum this so-called “trickle” can gather, however, is the subject of some controversy.

Tough Choice

Dr Yu Miaojie at Peking University said that research conducted

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2009 2004 2005 2006 2007 2008

2010 2011

Source: US Department of Commerce

Education level of Chinese job seekers in 2011

25%

34%

41% College and above High school Middle school and below

Source: Ministry of Human Resources and Social Security

with his colleagues showed that reshoring would be only a temporary phenomenon, since US manufacturing had already lost much of its cost-competitiveness after years of offshore outsourcing. An editorial in the overseas edition of the State mouthpiece the People’s Daily on July 31 cited Chinese experts’ arguments that despite rising labors costs in China, forecasts from foreign institutions on China’s weakening labor cost advantage vis-a-vis that of the US or NEWSCHINA I October 2012


Europe were “exaggerated.” The Deloitte survey also concluded that “China’s labor resources can qualitatively and quantitatively satisfy needs arising from the structural change of the industry.” China’s well-established advantages over cheaper alternative countries include infrastructure, lowcost engineers, and a fully-fledged supply chain. Meanwhile, MFG.

Annual wage increase of Chinese migrant workers (%) 25 20 15 10 5 0

2004

2005

2006

2007

2008 2009

2010

2011

Source: National Bureau of Statistics of China

Share of US capital in utilized FDI in China (%) 12 10 8 6 4 2

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: Ministry of Commerce of China

NEWSCHINA I October 2012

com, one of the world’s largest online manufacturing marketplaces, often called “the eBay of manufacturing,” pointed out that American companies are concerned about the possible short supply of capital and skilled workers if they return home. However, there is little doubt that the trickle will gain momentum in the future, even if predicting a “flood” may be somewhat premature. Over the past two years, it has become fashionable for international consultancies and US analysts to interview American CEOs on their interest in reshoring, and all the results show a growing openness towards production relocation. In its report entitled Manufacturing’s Secret Shift, Accenture, a global management consultancy, found that a majority of the North American companies surveyed (61 percent) were “considering shifting their manufacturing operations closer to customers.” It also implies that if more companies took customer service costs, taxes and other indirect costs into their calculations, the trend would likely quicken. A research team at the Massachusetts Institute of Technology led by Professor David Simchi-Levi surveyed the headquarters of more than 100 multinationals in the US, and found that 14 percent of them have plans to bring some of their production back to the US and another third are considering doing so. According to the AlixPartners 2011 US Manufacturing-Outsourcing Cost Index report, all key low-cost countries would see their competitiveness with the US “erode,” with China “experiencing particular negative pressure on landed costs.” According to the Boston Consulting Group in April 2012: “More than a third of US-based manufacturing executives at companies with sales greater than US$1 billion are planning to bring back production,” and that rate is “48 percent for executives at companies with US$10 billion or more revenue.” Politics and industry in the US are egging each other on. A report co-authored by Tom Ridge, former Homeland Security, and Colonel Robert B Stephan, former assistant secretary for homeland security for infrastructure protection, was released recently by the Alliance for American Manufacturing. It warns that too much reliance on foreign suppliers would put national security at risk. It took China’s massive steel and cement production as an example of this. In January 2012, the White House held the In-sourcing American Jobs Forum, where one of the most anticipated speakers was Harry Moser, founder and president of the Reshoring Initiative, a non-profit organization to promote the homecoming of US manufacturing. In May, MFG.com announced a strategic partnership with the National Tooling and Machining Association to “accelerate reshoring and job creation in the United States.” Meanwhile, for China, whose economic rise has largely been underwritten by its manufacturing power, the potential reshoring trend could leave its industry in a radically different position. The question is whether or not that would be a good thing.

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Photo by Zhou Gukai, Li Gen/CFP

I

n the economic climate following the global financial crisis, both the US and China seem to be realizing that while financial markets fluctuate, the smart money always goes with something tangible. Like manufacturing. In a recent report, the US Department of Commerce describes manufacturing as “a source of prosperity, innovation and pride,” and “crucial” to the country’s future competitiveness. The US, birthplace of the assembly line, dominated the world’s manufacturing output for over a century – before being overtaken by China in 2010. On the bilateral and global market, the “Made in China” brand has shown its power ever more clearly. In terms of trade in goods, the US has long been the largest source of China’s surplus, and China the largest contributor to the US deficit. According to the WTO, China has been a larger exporter of manufactured goods than the US since 2006, and that gap is growing by the year. Both countries have set ambitious goals for the future. In July the Advanced Manufacturing Partnership Steering Committee, set up by President Obama one year earlier, made specific proposals on enhancing the US advantage on innovation-oriented manufacturing. China, for its part, has made progress on moving up the value chain towards advanced manufacturing. An important part of the US initiative is to entice its own manufacturers back to American soil. US companies have already begun to re-arrange their global resources. Some have returned home. Some have chosen cheaper places like Southeast Asia and Mexico. More are considering following suit. As this relocation involves their China operations, it may not only affect China’s manufacturing competitiveness, but could reshape the overall competition between the world’s top two manufacturing powers, particularly since China was planning to use US investment to help achieve its goal.

Workers with Rainbow Arts and Crafts Co. in Jiangsu Province produced soft-toy versions of Wenlock, the London 2012 mascot

Manufacturing Exodus

Play to Your Streng Technology transfer from US companies does little to improve China’s manufacturing, but foreign investment doesn’t have to end there By Li Jia

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NEWSCHINA I October 2012


Photo by Eugene Hoshiko / AP

Better Birds

Workers assemble car engines at Shanghai’s General Motors

gths NEWSCHINA I October 2012

Quantitatively, US investment in China has never been as significant as most think. Statistics from the Ministry of Commerce of China (MOFCOM) show that foreign direct investment from the US into China has generally been in decline since 2003. The share of FDI inflow from the US was down to less than 3 percent of China’s total actual use of FDI in 2011, and remains as such. This is not likely to change in the near future. “According to the results of our 2012 Business Survey, our member companies reported a slightly less optimistic vision than a year ago…they have less ambitious plans to invest and expand,” said a representative from the American Chamber of Commerce in China (AmCham China) in an email to NewsChina. That means that even if all US investment were to be withdrawn from China tomorrow, it would be unlikely to cause a big deficit in foreign capital inflow into China. China has secured its position as the largest FDI recipient among developing economies for nearly 20 years. It “continued to be in the top spot as investors’ preferred destination,” states the World Investment Prospect Survey 2010-2012 by the United Nations Conference on Trade and Development (UNCTAD). China’s 12th Five-year Plan states that the country aims to “improve the level of use of foreign investment.” Foreign investment in the hi-tech industries is expected to help China upgrade its industry. The coastal areas of the Chinese mainland hold 85.5 percent of the total FDI in China. Now, these regions are aiming to “empty the cages for better birds,” clearing out labor-intensive foreign-funded companies, mainly representing other Asian investors, to make room for hi-tech American and European companies. Indeed, market-for-technology and capital has always been a deal China wants with foreign “birds.” “Over the past 30 years, we were successful in attracting foreign capital because we only had a potential market; now we are more able to focus on attracting foreign technology because we have a real market and less need for capital,” said Professor Zhang Hanlin with the University of International Business and Economy (UIBE) in Beijing. At a press conference in November 2011, Shen Danyang, the MOFCOM spokesman, acknowledged that the implementation of the US policy of manufacturing reshoring and revitalization has “put some pressure on [China’s goal of] receiving high value-added foreign investment.” In Professor Zhang’s view, the reshoring of some US hi-tech manufacturing in itself is unlikely to become a major trend in the near future. However, he explains, once it combines the ability of US multinationals to mobilize their resources globally with their governments’ pro-manufacturing policies, it could sharpen the US’s highend manufacturing, and lead to China lagging even further behind. Reshoring does not mean any reduction of US operations in the Chinese market. Boston Consulting Group predicts that production in China for export to North America is the sector most likely to return to the US. AmCham’s 2012 American Business in China White Paper shows that 81 percent of its members identify serving the Chi-

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na market as their primary purpose. While rebuilding or expanding their US production, giants like Caterpillar, Ford and GE plan to increase their production in China for the country’s domestic market. That focus on production for the China market may lead to reduced standards of production, as Chinese standards are normally not as strict as those in developed markets, not only in terms of product quality, but also labor and environmental impact.

Cheap

Although the rhetoric that “labor-intensive FDI no longer matters” has gained support in China in recent years, the impact of moving out of China to cheaper pastures cannot be played down. Shen Danyang, the MOFCOM spokesman, said at a press conference in August that emerging economies like India, Brazil and Russia have “become new hotspots for multinationals in their global resources arrangements,” a major contributor to China’s FDI inflow drop since the end of 2011. “As China continues to experience rising wages and production costs, the relative competitiveness of ASEAN countries in manufacturing is increasing,” says the UNCTAD World Investment Report 2012 released in July. Dr Yu Miaojie with Peking University does not believe that moving to cheaper countries would help the US improve its manufacturing power. He is more concerned about the Trans-Pacific Partnership, a de facto intra-APEC free trade pact currently high on the US agenda. He told NewsChina that cheaper products from those areas as a result of lower production costs and zero import tariffs could combine to hit China’s export of low-end products. King’s Wisdom Law Office in Wuxi, Jiangsu Province, focuses on legal services for foreign companies. Its director Jing Wen told NewsChina that local governments in Wuxi as well as Suzhou, a famous base for foreign manufacturers, are reluctant to renew contracts with labor-intensive foreign plants, but are welcoming hi-tech American and European companies. “Some cities in the northeast and poorer areas of the same province have rushed to invite them,” he said. Professor Zhang of UIBE argues that low-end manufacturers should be encouraged to stay within China rather than migrating to other developing countries, since China’s underdeveloped but resource- and labor-rich western regions need them. He found that without the preferential policies coastal cities were allowed to offer to foreign investors years ago, inland cities are not attractive enough to foreign investment.

Men, Not Machines, Matter

There are controversies concerning how much American companies can contribute to China even if they increase their investment in advanced manufacturing in the country. A typical example of China’s strategy of market-for-tech is the auto industry. Nearly all major world brands, including GM, Ford, BMW and Toyota, have joint ventures in China, yet none of these subsidiar-

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Share of FDI inflow in gross fixed capital formation (%, 2011) 10 8 6 4

China US East Asia

2

Developing economies

0

World

Share of inward FDI stock in GDP (%, 2011) 30 25 20

China

15

US

10

East Asia

5

Developing economies

0

World

Source: United Nations Conference on Trade and Development

Top five US exports to China in 2011 Machinery ($12.2 billion), Miscellaneous grain, seed, fruit ($10.7 billion), Electrical machinery

($10.1 billion), Motor vehicles ($6.8 billion), Aircraft ($6.4 billion). Top five US imports from China in 2011 Electrical machinery ($98.7 billion), Machinery ($94.9 billion), Toys and sports equipment ($22.6 billion), Furniture and bedding

($20.5 billion), Footwear ($16.7 billion). Source: US Trade Representative Office NEWSCHINA I October 2012


Value of exports of manufactured goods by China and the US(US$bn) 2000

1500

1000

500

0

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Source: WTO

ies have developed any breakthrough technologies. This is widely regarded as evidence of the strategy’s failure. In addition, US companies are increasingly interested in wholly-funded ventures than joint ventures. Arthur Kroeber, managing director of GK Research & GK Dragonomics, thinks the idea of tech improvement through joint ventures is “flawed,” because partners receiving technologies have no incentive to develop their own. In recent years, local governments in China have developed an interest in R&D centers set up by multinationals, and some such facilities have borne fruit. However, a report by the US Bureau of Economic Analysis in November 2011 showed that US multinationals spend less than 20 percent of their R&D expenditure on overseas affiliates. In addition, Mr Kroeber does not think they carry out cutting-edge research out of worries over intellectual property protection in China. “Despite persistent efforts by the Chinese government to protect intellectual property rights, survey respondents still describe a weak system of protection,” says AmCham in the email. More important, to reach the very top end of manufacturing quality “takes decades of understanding how the industrial process works, and being very careful about eliminating every mistake,” said Mr Kroeber to NewsChina, adding that the real solution is to encourage innovation among Chinese private companies to improve the quality of local suppliers. “Look at Coca Cola or Lee Cooper, are they hi-tech? There is no such thing as high-end or low-end. The key is, you focus on what you do, and do it better than your competitors,” said industrial economics expert Professor Jin Bei from the Chinese Academy of Social Sciences. He dismissed the prevailing belief that by rapidly attaining more hi-tech via massive spending on indigenous tech innovation or on tech transfers, China can sharpen its manufacturing power. What China has to gain from investment from industrialized NEWSCHINA I October 2012

economies, he told NewsChina, is “industrial culture,” which includes discipline, the pursuit of quality, and an obsession with innovation. In this regard, investors from Japan, Germany and the US have different strengths. “The question is not which country we need foreign investment to come from. We need them all, because they bring different cultures,” he said. The problem, he said, is that many Chinese producers concentrate on government relations, forcing them to neglect their production lines. Policies and their implementation change too often and too unpredictably. “When a carrot today may become a stick tomorrow, how can enterprises formulate long-term strategies?” he asked. Operating in the same environment, foreign companies make the same complaint. US and European investors from more developed rule-based market economies find it even more difficult to deal with this issue. “That is exactly why we need more investment from those places,” said Professor Zhang, “we need them to bring their operational culture which, compared with Asian investors, is more based on rules and shows more respect for labor and the environment.” Peng Shunxi, a Chinese engineer with GE, is happy with the added bonuses that come with a job at a foreign enterprise: “We have a lot of training, not only in technical know-how, but on leadership, communication and even finance. I debate with and criticize my bosses over technical issues, without worrying about ruining the relationship. You couldn’t even hope for this in a domestic institution,” he told NewsChina. Before joining GE, Peng had ten years’ experience in a Chinese State-owned enterprise and as a college lecturer. While Chinese worries over a US manufacturing exodus are likely premature, they serve as a handy reality check – foreign investment is helpful, and if China can make use of its real advantages, industry as a whole will benefit tangibly and intangibly. One thing seems certain, though – whether high or low-end, manufacturing dominance is still a big part of China’s game plan.

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NEWSCHINA I October 2012


Diaoyu Dispute

Pride and Prejudice Further feuding over island chains reflects the changing geopolitical landscape in East Asia By Yu Xiaodong

Two Japanese patrol boats try to force a boat carrying Chinese activists off course as it heads towards the Diaoyu Islands on August 15, 2012 NEWSCHINA I October 2012

Photo by AFP

A

ugust 15, the anniversary of Tokyo’s surrender in World War II, has long been a emotionally charged day. One feature has been a routine protest against Japanese politicians who continue to visit Tokyo’s Yasukuni shrine, dedicated to Japan’s war dead, including class A war criminals. This year, the two Japanese cabinet ministers who did visit the shrine barely got a mention in Chinese and Korean media. Instead, people were taking to the streets in protest over a series of sovereignty disputes concerning island chains unilaterally claimed by all three countries. On the day, 14 Chinese activists set sail from Hong Kong and landed on the Diaoyu island chain, a tiny series of rocky atolls known as the Senkaku in Japan, planting Chinese and Taiwanese flags on one of them. The group were promptly detained by Japanese coastguard officials, who are in de facto control of the islands, and repatriated to China. Only days later, 10 Japanese activists from rightwing political groups landed

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international

North Korea on the same islands, arriving on August 19 to plant the Japanese flag. They were among 150 Japanese activists, including nine lawmakers, who sailed to the islands to “commemorate the soldiers killed in World War II.” In China, these actions met with widespread protests, with marches, attempted boycotts and the destruction of Japanesemade cars in city streets.

History

The Diaoyu chain, which lies 120 miles northeast of Taiwan in the East China Sea, has long been a flashpoint for Sino-Japanese tensions. Occupied by Japan after the defeat of the Qing navy and its 1895 occupation of Taiwan, the islands were retaken by the US during their advance on Tokyo in World War II, and transferred the administration of the islands to Japan in 1971. According to China, the islands should have been returned along with other occupied territory, as various international treaties signed by the Allies stipulated that all Japanese colonial possessions seized since 1895 should be returned to their original owners. Japan responded with claims that the Diaoyu chain is an “integral part” of Japan. The situation is further complicated by Taiwan’s claim on the islands, although both Taipei and Beijing have declared them an inalienable part of China. In 1972, when China officially normalized diplomatic relationship with Japan, both parties agreed to drop the dispute and leave its solution to “future generations.” However, nationalist pressure on both sides, which has intensified with China’s economic rise, has seen this agreement come under increasing strain. Nationalists on both sides have attempted to land on the Diaoyu islands on various occasions. While Japan outlaws unauthorized landings, the government also chose not to bring formal charges against detained Chinese fishermen and activists. In return, China refrained from sending government vessels and personnel to challenge Japan’s de facto control of the chain. This uneasy peace

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has proven tough to manage amid a rising tide of nationalistic anti-Japanese sentiment in China and popular concern in Japan over China’s increasing military and economic might, coupled with the US’s “pivot to Asia” policy. In 2010, Japan detained and brought charges against a fishing ship boat captain who ventured into waters just off the Diaoyu islands. Beijing reacted by suspending all toplevel dialog and effectively imposing an embargo on Chinese-produced rare earths crucial to Japan’s hi-tech manufacturing sector. China’s greatest fear is that Japan, by gaining the right to enforce its domestic laws over the Diaoyu, will perpetuate its de facto control over the islands.

Right Turns

Popular protest in China over the Diaoyu sovereignty issue has been fomenting since April, when Tokyo’s governor Shintaro Ishihara, a well-known right-wing politician and the author of Japan Can Say No, a polemic in which Ishihara claimed that the 2011 earthquake and tsunami was a “divine punishment” for the “egoism” of the Japanese people, launched a campaign to purchase the Diaoyu islands from “private owners.” The Japanese government responded by announcing the central government would attempt the negotiation of the “nationalization” of the disputed chain. Chinese pundits have accused mainstream Japanese politicians of “a deviation toward the right,” with Ishihara held up as a leading example. These accusations are not unfounded. Struggling with falling domestic popularity and challenged by the opposition centerright Liberal Democratic party (LDP), which espouses policies that includes amending Japan’s pacifist constitution and making the emperor head of state, Japanese Prime Minister Yoshihiko Noda and his Democratic Party of Japan (DPJ) “has also sought to move his beleaguered party firmly to the right,” in the words of a July 28 Economist article. The same article was subtitled “an unusual militancy is creeping into mainstream politics [in Japan].”

South Korea

China

East China Sea

Okinawa Diaoyu Islands Taipei

China is in no mood to compromise, with the government well aware of a lurch toward nationalism and anti-Japanese sentiment among general population. On July 12, China sent two government boats into the Diaoyu island’s territorial waters as a “countermeasure,” only to be confronted with a much larger Japanese patrol boat. Prime Minister Noda said in a parliamentary meeting on July 26 that he would consider the deployment of Japan’s Self-Defense Forces, the country’s military, in response to “foreign incursion.” On July 31, Japan released its annual defense white paper, stressing China’s increased maritime activities both in the East China Sea and in the South China Sea, while also voicing concern over the lack of transparency in China’s military. “Confronting China will not help Japan assuage its anxiety,” ran an editorial in the State-run People’s Daily. Many argue that Japan’s desire to bolster its NEWSCHINA I October 2012


cling onto islands it seized during colonial times is alarming as it indicates an effort to overthrow the postwar settlement regarding Japan’s role in the international order,” continued Yang. Japan’s recent military cooperation with the Philippines and Vietnam, two other regional powers at odds with China over separate claims Beijing has made on islands in the South China Sea, is also a source of anger for Chinese observers. According to Li Wei, director of the Institute of Japanese Studies with the Chinese Academy of Social Sciences, interviewed by the English-language China Daily, “It is very clear that Japan aimed to follow Washington’s strategy to ‘balance’ China’s military development. Japan also aims to realize its own military independence.”

Japan

Photo by CFP

‘Asia’s Little NATO’

One of the Chinese activists disembarks in Okinawa after being detained by Japanese authorities

military capability is born not out of anxiety, but out of an ambition to become a “normal country.” Japan’s military, like Germany’s, is restricted under the still-binding terms of surrender to the Allies in World War II, which permit the country to develop a military only in a defensive capacity, restricting Tokyo’s ability to maintain a viable first-strike force. The same terms also restrict the constitutional role of the royal family, who were granted immunity from prosecution in exchange for surrendering their political power to Japan’s new parliament. “This is about how Japan will perceive its war history,” Yang Xiyu, senior fellow with the China Institute of International Studies told State broadcaster China Central Television (CCTV). “The fact that Japan tries to NEWSCHINA I October 2012

In its most recent defense white paper, the Japanese government has also chosen to highlight its ongoing claims on a separate island chain, known as the Takeshima in Japan and the Dokdo in South Korea. This chain is effectively under Seoul’s control. Japan also claims the Northern Territories, or Southern Kurils, which are controlled by Russia. In response, the South Korean president, Lee Myung-bak, visited the Dokdo islands on August 10, the first Korean head of state to do so. In a now-familiar routine in East Asian sovereignty disputes, Japan responded by recalling its ambassador, and later threatened to “re-evaluate” bilateral economic ties. The US seems to be calculating its position in this string of increasingly heated regional disputes. Faced with an increasingly assertive China, Washington has long been trying to make its separate defensive alliances with Japan and South Korea into a tripartite alliance, nicknamed “Asia’s little NATO.” Earlier in June, the US, Japan and South Korea held a joint military drill, the first of its kind, near the Korean Peninsula. Backed by the US, South Korea and Japan agreed to sign the General Security of Military Information Agreement, the first military pact between the two countries since Japan’s defeat

in 1945. However, emotions run high regarding the islands dispute as well as historical scars concerning Japanese atrocities in Korea during its wartime occupation. Most sensitive is the question of “comfort women,” sex slaves abducted to serve in Japan’s wartime brothels, women Japan officially claims were prostitutes but that South Korea insists were casualties of war, demanding reparations and official acknowledgement from Tokyo. To keep the peace between its two allies, Washington announced that it would take no sides in the island dispute, and use the terms “comfort women” and “sex slaves” simultaneously in any official remarks on the subject. However, in reference to China’s claims on the Diaoyu islands, military officials have repeatedly stressed that the 1960 US-Japan Treaty of Mutual Cooperation and Security applies to the disputed territory, implying that the US military would step in to aid Japan in the event of a military strike on the islands. On August 21 and 22, the US launched two joint military drills with South Korea and Japan respectively. While the US-Korea drill targeted North Korea, the month-long joint military drill with Japanese forces held around the Northern Mariana Islands and Guam, was believed to target China, as it involved retaking occupied islands. Senior Japanese military officials remarked that the exercises “simulated” the conditions of an attack and occupation of the Diaoyu islands, though the US Navy declined to comment. China’s government and military have remained tight-lipped on any change in Beijing’s strategy regarding the Diaoyu issue. In the meantime, activists have launched a fundraising campaign to pay for another landing in October, and have asked for an armed escort from the People’s Liberation Army. Japanese authorities, meanwhile, claim that Tokyo is setting in place a defensive strategy to protect the islands from “illicit” landings. Both countries are now holding their breath to see if, and when, the first shot will be fired in this heretofore verbal war between two old rivals.

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society

Beijing Floods

July’s flash flood caught Beijing authorities unawares, leaving dozens dead and millions questioning the foundations China’s first city has been built upon By Yuan Ye

Photo by Zeng Hongge

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Deep stagnant water on the Beijing, Hong Kong and Macau Expressway wasn’t cleared until two days after the storm

eginning 10 AM on July 21, a 16-hour rainstorm saw an average 170 mm of water fall on Beijing’s usually arid metropolitan area. Downtown saw an excess of 200 mm, while in the outlying district of Fangshan in the southwest, 460 mm fell in a matter of hours. The biggest rainstorm since China began recording precipitation data in 1951, nearly two million people were affected by traffic chaos and water damage valued at 10 billion yuan (US$1.6bn). Official reports stated that 79 people lost their lives in flash flooding, with the death toll particularly high in outlying rural areas. Though brief rainstorms are known in Beijing, the city is better known for its arid weather and seasonal water shortages. As a result, Beijing’s residents and city authorities were unprepared for a storm of such protracted length and magnitude. Major thoroughfares became torrents of water, with some low-lying residential areas resembling Venice, according to eyewitnesses. When the clouds had receded, the city counted its losses, and people began to ask questions about how the devastation had been so extensive in China’s much-vaunted and ultramodern capital.

Photo by CFP

Drowning

At the Guangqumen underpass in downtown Beijing, floodwaters swallowed several cars and killed one commuter

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Although the city’s meteorological office (BMO) issued a yellow flood warning, which later changed to orange, few heard the warning and many commuters were on the roads when the storm took a turn for the worse. Ding Zhijian, 34, father of a three-year-old and an editor at a children’s magazine, was on his way home as rising water blocked traffic in the underpass under Guangqumen Bridge in the city’s downtown area. By then, hours of heavy rain had already overwhelmed the city’s drainage system. While drivers around him managed to escape their cars, Ding could not get out of his car, which had been submerged by floodwaters, shorting out the electric door locks. Ding’s vehicle and body were recovered two hours later, making him the first of what would prove to be dozens of victims of the storm. Soon, reports trickled in of busloads of commuters swept away while attempting to swim for safety, and of villages in outlying suburbs crushed by landslides. On July 26, Beijing’s municipal government released an official list of 79 victims, 47 of whom were said to have drowned, 11 in their NEWSCHINA I October 2012


cars. Other causes of death were electrocution by downed power lines, building collapses, landslides, falling debris and lightning strikes. Five government rescue workers also died at their posts. Although the city government mobilized more than 7,000 police officers to assist stranded motorists and commuters, and Beijing Drainage Group, the State-owned company in charge of the city’s plumbing, deployed its 18 major rescue units, they were soon overwhelmed. When the BMO upgraded their storm warning to orange at 6:30 PM, most of the city’s roads were gridlocked with paralyzed and abandoned vehicles. In the city’s rural suburbs, flooding was wreaking havoc. In Tongzhou District beyond the east fifth ring road, a “hurricane” was reported to have hit several villages around noon. A large number of houses, trees, cars and other public facilities were destroyed and two people were killed by falling objects. In Fangshan District outside the southwest fifth ring road, flash flooding cut off road access to 12 townships and cut communications with six. In total, 66,000 houses were damaged by rain and wind, of which 8,245 collapsed. 95 sections of road were closed. The brand-new Beijing, Hong Kong and Macao Expressway, running southwest out of the city, saw a half-mile stretch between the southwest fifth and sixth ring roads become torrents six meters deep in some places, submerging dozens of vehicles. Landslides were also reported in mountainous areas north and northwest of the city.

Aftermath

The great loss of life and property in the rainstorm sparked public anger with what people saw as the failure of authorities to adequately prepare the city for extreme weather. The speed at which the city’s mostly-new drainage system had been overwhelmed, a problem familiar from previous, less severe floods in Beijing, was a particular source of criticism. Last year, five people were killed in another summer rainstorm in Beijing which also caused traffic chaos on the city’s roads. However, it seemed little had been done to bolster the city’s flood defenses since then. According to Chen Ming, General Manager of the Beijing Drainage Group, more than 90 concave passes under the overpasses on Beijing’s ring roads and major streets rely only on storm drains during heavy rain. However, most of these stations were built decades ago, and were modeled on those used by largely arid cities in the former Soviet Union. Humiliatingly for the city authorities, areas with Ming and Qing Dynasty plumbing, including the Forbidden City complex, reported little or no flooding. The rapid expansion of Beijing in recent decades to handle a massive influx of workers has led city planners to focus on speedy, economical construction, rather than sound planning. Bloggers mocked the city for prioritizing the “visible” signs of development, such as skyscrapers, while neglecting the “invisible” necessities of urban planning – such as adequate drainage. When Hong Kong was hit by a severe typhoon days later, and the city’s plumbing proved up to the task of keeping

NEWSCHINA I October 2012

the city’s urban areas free of floodwater, unfavorable comparisons were drawn with the devastation in Beijing, the national capital. In the early 1950s, Beijing had a population of 2 million. By 2012, 20 million people were living in the municipal area, which is about half the size of Belgium. Environmental researchers believe this enormous population explosion has caused the capital to settle more deeply into the natural basin it occupies, and average temperatures in the urban area to rise. In 1992, Beijing built its first ring road, paradoxically known as the Second Ring Road, a 20-mile-long stretch of asphalt encircling the city center. 11 years later, the city had completed its 62-mile-long fifth ring road. In 2009, the 119-mile-long sixth ring road was officially opened. Green spaces and waterways falling within these ring roads, some of which were thousands of years old, were rapidly concreted over and allocated for cheap housing for urban workers, luxury apartment complexes, and new industrial districts. Beijing has been at the forefront of the urbanization in China, with provincial cities aping the capital’s urban planning in order to curry favor with the central authorities. As with Beijing, these cities are recording increased instances of rainstorms and flooding each year, leading to a rising national death toll and ever-greater damage. Another problem is the destabilizing effect massive urban sprawls have on the local environment. “The average energy consumption of urban residents is three times that of the rural population,” said Wang Tao, an energy and climate expert from the Carnegie-Tsinghua Center in Beijing, in a recent interview with Sanlian Lifeweek magazine. “Urban populations contribute 70 percent of carbon dioxide emissions,” he continued, adding that in his opinion, this has turned Beijing into a vast heat sink, increasing the likelihood of extreme weather. In June 2009, the largest rainstorm in 27 years hit Wuhan, the capital of Hubei Province, with an average of more than 147 mm falling within the city limits, rendering more than 260 road sections impassable. In 2011, summer rains again flooded the city, with a half-meter of water recorded on 76 sections of road. Two months prior to the rainstorm in Beijing, a number of southern cities also experienced heavy rainfall. Nanning, capital of Guangxi Province, issued a red storm alert in mid-May which was followed by heavy flooding. In Hunan Province, more than a million people were displaced by a rainstorm in May, resulting in estimated economic losses of 840 million yuan (US$133m). Jiangxi, Fujian and Guangdong had also seen attacks of heavy rainfall recently. Just two days after the Beijing storm, a heavy rainstorm also hit Tianjin, a metropolis only 30 minutes from the capital, with precipitation peaking at 147.6 mm in the city center. As the capital continues to calculate losses, its residents are asking whether this was a freak event, or a sign of things to come. If the latter proves to be the case, the authorities will need to re-examine their commitment to urban planning, and start investing in firm foundations, both visible and invisible, for China’s cities, starting with Beijing.

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society

Rape Scandal

Police the Police The gang rape of an 11-year-old girl abducted by a prostitution ring became a national scandal after the victim’s mother was sentenced to “re-education through labor” while attempting to bring her daughter’s captors to justice By Sun Zhe

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ang Hui has spent six years pursuing the death penalty for the men who abducted and repeatedly raped her then 11-year-old daughter. However, Tang may now give up her battle, after having just been granted early release from a labor camp. Now, this 39-year-old mother hopes to start a new life with her child, away from their hometown of Yongzhou, Hunan Province. Re-education through labor is an extrajudicial punishment and a relic of the Soviet justice system which allows Chinese police to send anyone to a labor camp for anywhere from one to four years at a time. Tang had petitioned her local police bureau for six years, demanding her daughter Lele’s captors be brought to trial, before she was slapped with her 18-month sentence, which a public outcry recently forced the police to overturn.

Nightmare

In early November 2006, Lele (not her real name), was raped by Zhou Junhui, a man she met at a roller skating rink. Zhou reportedly coerced Lele into prostitution for three months at a local brothel. Over three months, Lele was forced to have sex with clients over 100 times with the income split between the brothel madam and

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Zhou. She was allegedly injected with unidentified drugs to allow her to see more clients in a single night, according to a report by Xinmin Weekly, a Shanghai-based magazine. Whenever Lele refused to work or was caught attempting to call her parents, she would be cruelly beaten up by the brothel madam, Qin Xing, and her boyfriend Chen Gang. In late December 2006, the girl was gang raped by Qin Bin, the madam’s younger brother, and three other men. Lele’s parents finally managed to locate their daughter after an anonymous tipoff. Tang, her mother, immediately called up Yang Xuejun, the police officer heading up the official search. According to Tang, Yang only “paid a cursory visit” to the brothel and “left without doing anything,” claiming he had more important business to attend to. Tang resorted to calling the emergency police line for assistance, who eventually whisked Lele back home. The next morning, when she went to file the case to the Lingling District Public Security Bureau (PSB), which had jurisdiction over the area where the brothel was based, she discovered it was the same PSB where Yang Xuejun worked. Yang refused her request, and told her to go home.

It was only after Tang threatened to jump off the police station roof that her case was eventually filed. Police waited 19 days before raiding the brothel and arresting the madam, while the other six chief suspects, including the five gang rapists and Chen Gang, the madam’s boyfriend, was left undisturbed. It was later discovered that an officer at the Lingling station, Wei Xiaohui, acted as a “courier,” delivering messages between Qin, the brothel’s detained owner, and other suspects, allowing them to destroy evidence and fabricate alibis. The local police chief was also revealed as a former classmate and good friend of Chen Gang. Lu Qun, an official with the Hunan Provincial Disciplinary Inspection Commission, remarked on his microblog that any brothel could not have functioned without the “protection and connivance” of the local police force. In desperation, Tang petitioned the Hunan Provincial Public Security Bureau that oversees the Yongzhou police department. With a rising tide of public anger surrounding the case, the bureau swiftly launched its own investigation, locating and detaining the remaining suspects, apart from Qin Bin, who remained at large. NEWSCHINA I October 2012


lawyers, publicized Tang’s detention on Weibo, China’s Twitter equivalent, with the post going viral in seconds after being retweeted by Phoenix Weekly’s Deng Fei, a veteran investigative journalist with 2.3 million Weibo followers. The case soon made national headlines, effectively forcing the Yongzhou police to release Tang as well as leading the Hunan provincial government to launch a full investigation into the alleged police misconduct.

Photo by Xinhua

Outcry

Tang Hui in interview after her release from a labor camp, August 10, 2012

Ongoing Battle

In June 2008, the Yongzhou local court formally charged Zhou with statutory rape and kidnapping, and Qin Xing, the brothel madam, with kidnapping. Both were sentenced to death after a brief trial. Qin Xing appealed against her death sentence, asking that it be commuted as, while in prison, she had prevented a cellmate called Zhou Lanlan from committing suicide. However, the prosecution found no evidence of this, though no secondary charges of false testimony were added to Qin’s charge, much to the dismay of Lele’s parents. Four other suspects received sentences of 15 years to life for the rape of a minor, as well as being forced to pay compensation totaling 90,000 yuan (US$14,080) to Lele’s parents. Yang Xuejun, the police officer who had obstructed the investigation, however, received only a “serious warning” for his misconduct. Wei Xiaohui, the police officer who had aided and abetted the perpetrators, received an even lighter punishment. Both men were not charged, and kept their jobs. Tang was outraged, and appealed all six verdicts, demanding that all seven suspects be put to death after paying 1.84 million yuan (US$288,000) in compensation. She also

NEWSCHINA I October 2012

called for harsher punishments for the two police officers implicated in the case. Lele’s case bounced back and forth in the Hunan Higher People’s Court before a final verdict was issued in June 2012. Zhou and Qin received death sentences, while the four suspects of gang rape were sentenced to life imprisonment, and Chen Gang, the brothel madam’s boyfriend, was sentenced to 15 years in prison. It was not Tang’s demands for harsher penalties for the perpetrators which led to her being sent to a labor camp. It was her continued fight to have the police officers who had both protected her daughter’s kidnappers and obstructed the investigation which led to her arrest. The court repeatedly refused to bring either officer to trial, refusals which led Tang to ever-more desperate protests. Her removal to a labor camp, according to a statement released early August by the Yongzhou police bureau, was due to her having “severely disturbed social order, and caused extremely grave negative results.” According to eyewitnesses, Tang had blocked access for official vehicles to the Yongzhou court’s parking lot in an attempt to get court personnel to accept her petition. Gan Yuanchun, one of Lele’s prosecution

The extreme nature of the case, and growing dissatisfaction with the perceived abuses of China’s police force, has led to widespread public anger as well as a strong show of support for Tang and her daughter. “It was extensive media coverage which spurred the higher authorities to act,” commented Ye Tieqiao, a journalist with China Youth Daily, on his microblog. “Who knows how many others like Tang Hui are out there?” “It is media rule. We cannot call it a victory, because we can expect the next Tang Hui to appear soon,” the post continued. Researchers and pundits have started calling for the abolition of the “re-education through labor” system, which effectively allows police to detain and sentence citizens without even the semblance of a trial. The police do not even have to officially arrest someone in order to commit them to a labor camp, making re-education through labor a popular solution to troublemaking petitioners, whose rights to petition the government are enshrined in both China’s constitution and its legal system, but nevertheless are viewed as an embarrassing nuisance by the authorities. Yu Jianrong, a researcher from the Chinese Academy of Social Sciences, said on Weibo that the police are particularly liberal in sentencing the victims of forced evictions and police abuse to re-education through labor. Now, however, the media attention created by Tang Hui’s detention and subsequent release, is making the abolition of re-education through labor a cause célèbre for advocates for social justice.

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society

Index Dispute

Rejuvenation in Progress A report that put a precise percentage on China’s contentious “great rejuvenation” has provoked heavy skepticism on all sides By Yuan Ye

2049, a serendipitous 100 years after the founding of the People’s Republic, China will enter the first world, having achieved the task of “national rejuvenation.” The index drew intense scrutiny and scorn in the media and on the Internet. Finding the index somewhat irreconcilable with the daily experience of most Chinese people, many expressed doubt in the scientific validity of Yang’s conclusions. In recent years, the use of statistical indices has become popular in China’s social sciences and in government reports, but with “rejuvenation,” a concept that elicits interminable clashes over history, philosophy, politics, culture and ethnology, a precise numerical calculation was doomed to be fiercely challenged.

Photo by CNS

Calculation

Yang Yiyong

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his August, while China watched with pride as the country’s medal tally ticked up at the London Olympics, a report entitled The Monitoring and Evaluation Index for the Great Rejuvenation of the Chinese Nation (or simply, “the rejuvenation index”) was released. It declared, to the surprise of many, that China was almost two thirds of the way towards accomplishing its “national rejuvenation.” Yang Yiyong, author of the report and director of the Macroeconomics Institute at the National Development and Reform Commission (NDRC), wrote that the index had now reached 0.6274, in other words, 62.74 percent of a successful renaissance. Yang further predicted that in

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Defiant, Yang claimed his method of calculating the index was “perfectly scientific.” In his system, there are three levels of indicators. The first level is the index itself. The second level includes six factors – economic development, social development, “character quality” of the population, scientific and technological innovation, resources and the environment, and international influence. At the third level are 29 basic indicators, in aspects such as GDP, GNI, urbanization, energy consumption, life expectancy, R&D, air quality and military expenditure. For reasons best known to Yang himself, indicators in the system carry different weightings. At the second level for instance, economic development is worth 25 percent, while social development takes 20 percent, and international influence a mere 10 percent. Figures at the third level contribute to the second level, which are then used to calculate the final rejuvenation index. According to Yang, his figures came from the National Bureau of Statistics as well as credible international organizations such as the World Bank and the World Health NEWSCHINA I October 2012


Organization. Yang and his partner spent a month in early 2012 compiling the report. In fact, it was first published in June in the journal of the Central Party School, yet few took notice until August, when Yang brought it to an academic forum on the theme of “China’s modernization” sponsored by the Chinese Academy of Sciences and Peking University.

Questionable Concepts

Yang has suggested that his “rejuvenation index” could be read as a “modernization index” for China, when he responded to questions from netizens during an online interview following wide media exposure of his report. Most Chinese adults are quite familiar with the word “modernization.” In 1964, then-Premier Zhou Enlai first introduced the concept of the “four modernizations” – in industry, agriculture, defense, and science and technology. Since then, modernization has become a national goal, prominently extolled in school textbooks. Meanwhile, running parallel was another ideal, known as “studying for the rise of China,” a quotation often attributed to a 12-year-old Zhou in another legend often repeated in Chinese schoolrooms. Many Chinese were deeply influenced by these ideas. Yet while China’s national power increased rapidly in the past three decades, the concept has been gradually replaced with a new one – the “great rejuvenation.” According to Chinese media, the new concept is said to have originated from He Xin, a 63-year-old scholar known for his anti-Western inclination, a favorite of many among the Chinese leadership. Since 1997, after the Chinese Communist Party’s 15th National Party Congress, the “great rejuvenation” was gradually adopted into official ideology, being pointedly dropped into official speeches by presidents Jiang Zemin and Hu Jintao. Yang Yiyong, while acknowledging the similarities between modernization and rejuvenation, also warned that the two shouldn’t be fully equated. Holder of a post-doctorate in sociology from the Chinese Academy of Social Sciences, Yang claims to have studied modernization for “many years.” “Modernization is a process. It has a beginning, but no end,” he said. “The great rejuvenation of the Chinese nation is an incremental goal in China’s lengthy process of modernization.”

Coincidence

Yang has been touting his index for quite some time. In 2007, he published his first National Rejuvenation Index Report, which, based on figures from 2005, indicated that China had accomplished 46.44 percent of its rejuvenation. Yet in only five years, the index has seen an increase of 16 percent, a process many Chinese media have called a “light-

NEWSCHINA I October 2012

speed rejuvenation.” “In the past five years, China’s average annual GDP growth reached 11.2 percent. The speed of urbanization was also comparatively fast,” Yang explained. In his opinion, GDP growth and urbanization might slow down in the coming years, and so too will the speed of rejuvenation. However, he also told media that when the first index was released in 2007 “some government leaders thought it was low.” Yang’s words caused doubts that his research was neither independent nor objective, but merely an academic vanity project. “An index should be calculated by the real-life situation instead of according to feedback,” commented Liu Hongbo, a news columnist. “It is inevitable that people might imagine the rapid increase was influenced by power or money.” To defend his innocence, Yang responded that he had not applied for any government sponsorship for the research, claiming the project was “purely a personal interest.” However, this response was further criticized. “Such an explanation only proved the index was unprofessional,” said news critic Pan Hongqi. “Its authoritativeness and credibility were greatly undermined.” Among all the controversies, the most disputed issue may be the definition of rejuvenation itself. As Yang would have it, there are five criteria for China to meet: economically reaching a level of development equal to countries with a “medium level of development;” achieving a globally advanced level in social development including science, education and healthcare; perfection of a socialist electoral and legal system; improved environmental protection; and reunification with Taiwan. However, in Yang’s system, hardly any indicators reflect the development of “socialist democracy” or the process of reunification. “We haven’t found an internationally recognized figure to estimate the development of a socialist democracy,” said Yang. And as for the reunification: “As long as China accomplishes her rejuvenation, reunification will happen naturally.” The quicker-witted among China’s netizens later exposed a curious statistical coincidence. The amount of time that has passed since the founding of the People’s Republic on October 1, 1949 to now is 62.74 percent of one hundred years – exactly the same figure given in Yang’s index. Inevitably, this has led many to suggest that instead of devising a convoluted system of calculations, Yang might have gauged China’s progress just as accurately with a calendar. Nonetheless, Yang Yiyong has insisted that his index was reliable, and that he plans to issue a new index every five years. “Different people might judge things differently. Some thought it was too high, but can they tell me the correct figure? Do they have a concrete number?” he asked.

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society

Business Strike

Shop Cops

An anti-counterfeiting campaign headed by the Shenyang police puts the whole city out of business By Li Guang and Wang Quanbao in Liaoning

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he markets and streets of Shenyang, one of the biggest and most populous cities in northeast China, were desolate on August 5. The capital city of Liaoning Province appeared to have gone out of business, leaving its residents stuck for anywhere to shop, dine, or even get a haircut. Merchants, usually unwilling to take a single day off work, shuttered their stores for fear that police might come to inspect everything from counterfeit goods to business paperwork, and impose heavy fines. Rumors

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had been circulating in the city that the government was badly in need of money to fund its hosting of the upcoming National Games, China’s most prestigious national-level sports competition, and were looking to shake down small businesses. Unable to risk being fined, many small businessmen closed their doors, and their neighboring stores followed suit. More than 80 percent of stores in an electronic goods wholesale hub in downtown Shenyang were closed when the “strike” peaked on August 7.

Rooted in Rumor

The most popular rumor had it that a toothpick seller was fined for being unable to produce a “logging permit”. However, despite the efforts of the media, this specific merchant was never located. The government was quick to deny the rumor. On August 7, the Propaganda Department of the Shenyang Municipal Party Committee posted on Sina Weibo, China’s Twitter equivalent, refuting the existence of an anti-counterfeiting campaign or heavy NEWSCHINA I October 2012


Photo by Li Yang

Shuttered stores at a market, Shenyang, Liaoning Province, July 15

fines, and trying to talk the merchants out of their strike. Some stores rolled up their shutters, though the message conflicted with a notice from the local police saying that a crackdown on counterfeit goods had ended. In the city’s budget report released early this year, it was stated that the upcoming National Games and construction of the city’s economic development zone would need considerable financial support, thus it might be difficult for the government to generate enough revenue to make ends meet. The city still lacks 18 new venues for the sports event, though it is currently renovating 22 old stadiums. The city’s non-tax income revenue over the first five months of this year totaled 7.7 billion yuan (US$1.2bn), or 56.5 percent up from the same period last year. “Since some government departments are in the habit of imposing heavy fines that merchants cannot handle, they might speculate that the money was being channeled into the National Games,” said Chen Haibo, the city’s mayor. Chen said that the rumor probably NEWSCHINA I October 2012

started because the city had been touting its frugality in the planning of the games, which are to be held next fall. Hundreds of stores have remained closed since mid-July, fearing heavy fines and possible arrests. “In the past, when a store was caught selling fakes it would be fined. But this year, a lot of store owners were arrested before they were fined,” said Tang Xiaoyun, who has been running a business in Shenyang for more than 10 years. A home appliance dealer, who asked to remain anonymous, told NewsChina that several of his staff were taken away by the police in order to “assist with further investigation.” He claimed this had happened once a month from May to July, and each time, his employees would only be released after the store submitted a sum of cash. He had handed in a pile of paperwork weighing six kilograms, but that did not stop police picking out issues with product packaging and other small problems, leading to yet more fines. Another store selling bags and suitcases was also inspected, and fined three times in as many months.

Unjust Campaign

Business strikes also occurred in almost all other cities in the province, according to the provincial publicity department. The anticounterfeiting operation was part of a bigger campaign to crack down on economic crimes that began in March this year, according to Wang Huwen, a government official in Shenyang. Early February, Shenyang played host to a meeting called by the Ministry of Public Security to initiate a nationwide crackdown on economic crime, with Liaoning Province held up as a pioneer in the crackdown. After the meeting, the power to deal with economic crimes, limited to county-level police units or above, was devolved to police substations, the lowest level of China’s public security apparatus. Wang Dacheng, head of the economic

crime investigation team with Liaoning police, said at a press conference late March that this year, the police aimed to solve 70 percent more cases of economic crime than in 2011. At a Liaoning police general conference on May 15, it was announced that those who stood out in the campaign would be rewarded and promoted. At the meeting, a bonus pot of 33.5 million yuan (US$5.25m) was established to reward police units who filed and solved major cases, according to a policeman who attended the meeting. Performance rankings in the campaign across the province’s 14 municipal police bureaus were updated on a daily basis, with fines and other penalties imposed for those lagging behind. The campaign saw quick results. Over the first five months of this year, the Liaoning police filed roughly 6,400 economic crime cases, more than in the whole of 2011. About 4,300 cases had been “solved,” around 85 percent of the total number last year. The Shenyang police topped the campaign rankings across the country’s 32 large and medium-sized cities, thanks to their heavy involvement in the anti-counterfeiting campaign, normally the jurisdiction of the Quality Supervision Bureau or the Administration of Industry and Commerce. Xu Wenyou, head of the Shenyang police and director of the anti-counterfeiting efforts in the city, declined to be interviewed, citing that he needed a permit from his superiors to talk to the media. The quotas and pressure placed on the campaign itself could negatively affect its implementation, commented Wang Huwen, the government official. He added that when the police interfere with business, fairness is often sidelined. “It would cause panic in the market if the police took over the duty of market management,” said Wang. “The police are not as professional as the Quality Supervision Bureau or the Administration of Industry and Commerce when it comes to dealing with market issues.”

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Environment

Conservation

LAST RESORT The only remaining habitat in China for migrating red knots is vanishing, due to human encroachment, posing a threat to the very survival of this species

Photo by Jan van de KAM

By Wang Yan in Beijing and Tangshan

Intertidal mudflats are a crucial stopover for migrant birds, the main source of food for resident waders and a major seasonal cash cow for local shellfish harvesters

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NEWSCHINA I October 2012


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he Bohai Bay coastline in northeastern China, a magnet for migratory wading birdlife, is also becoming a playground for China’s largest land reclamation companies. As one of the world’s most important wildlife habitats, Bohai Bay, located in the middle of the East Asian-Australian Flyway (EAAF), has provided a vital stopover for millions of migratory birds, and 6080 percent of the world’s total pass through the region every year. However, Bohai Bay has also become one of the most densely populated and rapidly developing commercial and industrial areas in the world, putting humans in direct competition with the region’s wildlife. Between 1994 and 2010, a total of 450 square kilometers of offshore area, including 218 square kilometers of intertidal flats (onethird of the total area of such flats in the Bohai area), were appropriated by land reclamation projects. Ornithologists Zhang Zhengwang and Yang Hongyan from Beijing Normal University are among the naturalists decrying the destruction of this vital habitat. “[Land reclamation] has forced migrants northward to huddle in an ever shrinking ‘rump,’” ran their recent joint paper on the subject. “Worse still, we predict the population density of waterfowl in these havens… will soon reach the point of collapse, in view of the continued reclamation activities in the Bohai Bay area.”

Shrinking Reserves

The “ever-shrinking rump” referred to by Zhang and Yang is a region that stretches some 20 kilometers along the coastline of Luannan County, Tangshan City, Hebei Province, which plays host to 200,000 migratory waterfowl representing 60 species from March to late June each year. Zhang and Yang have focused their ornithological research in this specific area for a decade, in particular monitoring internationally significant concentrations of sixteen species. Among them are two subspecies of red knot, curlew sandpipers and, most critically, relict gulls, listed as a “vulnerable” species by the International Union for Conservation of Nature (IUCN). In mid-July, our reporter visited this study site. Although most of the migratory birds, such as red knots, have moved to their northern breeding home, NewsChina was able to observe bird species such as the Kentish plover, pied avocet and black-winged stilt nesting and feeding on the tidal flats. Despite the large flocks of waterfowl which are still visible in this area, ornithologist Que Pinjia told our reporter that their presence belies the harsh reality of alarmingly rapid habitat loss. Que, also from Beijing Normal University, was conducting daily tallies and banding of newly-hatched Kentish plovers in the area. Two large industrial development projects have been underway on the western and northern coasts of the Bohai Bay. The Tianjin Binhai New Area located west of Bohai Bay and the Caofeidian New Area to the north were started in 1994 and 2002 respectively, with the former under the jurisdiction of Tianjin Municipality and the latter under the government of Tangshan City.

“The birds have nowhere else to go.”

NEWSCHINA I October 2012

Sitting adjacent to the Caofeidian land reclamation project which covers a total area of 1,943 square kilometers, the limited coastal regions of Luannan are already dotted with dykes, harbors, roads, saltpans, shrimp ponds and construction sites on manmade islands, all evidence of increasing human activity. These projects come alongside petrochemical giant Sinopec’s 1 billion-ton oilfield which now operates on the seashore. Yang Hongyan has done years of research on the area’s two subspecies of red knot, calidris canutus –the piersmai and rogersi subgroups and claims that, in 2010, the area was home to at least 67 percent of the world population of the former and 57 percent of the latter during April and May. “Peak spring numbers of the two red knot subspecies in the EAAF increased from 13 percent of the total global population in 2007 to 62 percent in 2010,” wrote Yang in her research paper. “The increase in red knot numbers in this area comes alongside a decrease in the total flyway population of both subspecies, from 222,000 in 2000 down to 130,000 in 2007, and further down to 105,000 in 2009.” Yang’s calculations confirm that these rare birds have been forced into ever-smaller areas of the tidal flats, and are now concentrated in the core area of Tangshan as land reclamation continues to erode habitats in Bohai Bay. “The birds have nowhere else to go,” Yang told NewsChina. “We can therefore conclude that waterfowl density at the remaining coastal habitats in the Bohai Bay area, especially in Tangshan, will continue to increase as intertidal flats are lost. As a result, instinct has forced the birds to congregate together or to relocate, leading to a decline in their flyway population.”

Human Threat

Intertidal flats in Luannan are so far the only intact haven for the migratory shorebirds along the entire Bohai coastline. Despite this, commercial saltpans and shrimp ponds have occupied much of the coastal territory in the region, and now rumors of a planned sea cucumber farm, an expensive local delicacy, have begun to circulate. “If this project is approved by the local government, another patch of precious mudflats will disappear, which will pose a lethal threat to the birds,” Que Pinjia told our reporter. In early July, local villagers submerged a 200,000 square meter area of tidal flats, a breeding ground for Kentish plovers, for use as shrimp farms, destroying some 60 nests and hundreds of eggs. Que, whose research site happened to cover the area, had to terminate his research. Much to his surprise, he found a number of Kentish plovers had started to nest on the edges of saltpans. “Disruptive human activity is continuing, forcing the birds’ habitats inland,” he said. Relocation of nesting birds is one thing, but migratory wildfowl need a stationary stopover if they are to survive their epic journey. Red knots, for example, fly over 10,000 kilometers each year from Australia and New Zealand, their winter habitats, to their summer breeding grounds in Siberia. Their nonstop six day flight forces them to land in Bohai Bay and feed for up to a month before resuming their flight path and preparing themselves for their breeding cycle in the Arctic. “This bay area is historically a decisive stopover site for migratory red knots, especially now that over 30 percent of the original mudflats

35


Emvironment

have been transformed by human development,” said Zhang Zhengwang. “The limited remaining habitat is therefore crucial to their very survival.” “Red knots only appear in big open intertidal coastal mudflat systems where they can find mollusks,” commented Dutch shorebird biologist Theunis Piersma, the namesake of one red knot subspecies, to NewsChina via email. Theunis Piersma has been cooperating with Beijing Normal University ornithologists in their Bohai projects for years. He expressed his concerns about the survival of local species during a conference held in late May in the coastal city of Tangshan, Hebei Province. “I feel very proud to have these birds named after me, but I fear that they may actually become extinct in my lifetime,” he told delegates.

Dredging the mudflats

China

Gloomy Prospect

Past experience gives conservationists little hope. Along China’s Yellow Sea coastline, another highly developed industrial region, mudflats are vanishing at an astonishing rate, and this habitat loss has been blamed for a sharp downturn in migratory bird populations in Australia and New Zealand over the last 30 years. A land reclamation project comprising 300 square kilometers of mudflats in Saemangeum, South Korea, in the spring of 2006 devastated some local bird species. Saemangeum was once home to 23 percent of the world’s population of great knots, but since the mudflats were closed off in 2008, this population has declined by 20 percent, resulting in the species now being labeled “vulnerable.” “The worst-case scenario resulting from land reclamation is the global extinction of both subspecies of red knot,” Yang Hongyan told our reporter. “This could happen as soon as one or two years, just like the disappearance of great knots in Saemangeum.” “Since most coastal areas in the adjacent regions have been developed beyond recovery we hope the limited remaining habitats can be preserved,” said Zhang. “The ecological benefit, for both humans and birds, of preservation is more than any calculable economic value of land reclaimation. These wetlands have an ecological function as the ‘kidneys’ of the Bohai Sea.” According to Zhang, promoting eco-tourism or setting up a protection zone would be a good start if the region is to be protected. However, he acknowledged that gaining official approval for a National Wetlands Reserve from the central government would take years. “We have tried to contact the Luannan County government and submitted our proposals, but we have received no response,” Zhang told our reporter, “All in all, the county government has its sights set on short-term gain by boosting the local economy.” “WWF Hong Kong would provide initiative funding and I believe it is not a big problem for us to get protection money from overseas, including from the Netherlands and other countries which also host these bird species’ wintering sites or breeding grounds,” said Yang, “All the countries involved on the flyway, including the US and New Zealand, are very concerned about the situation here.” Since 2009, people from the Global Flyway Network, a collaborative global organization of shorebird researchers and birdwatchers, have come to the Luannan coastal mudflat regions every spring to

36

Land reclamation in progress

Oil drilling in Nanpu

A salt plant

NEWSCHINA I October 2012


ro

C.c piersmai

C. c

Northward migration routes of the two red knot subspecies

i

rs ge

salt flats

research zone

land

provincial boundary

reclaimed land

river and channel

Tianjin

Tangshan

Beipu Nanpu

Australia

Zuidong Caofeidian New Area New Zealand

Tianjin Binhai New Area

Bohai Bay

observe and record the conditions of banded shorebirds along the flyway. Wang Huigang, the Luannan Forestry Bureau chief, the government body responsible for environmental protection in the region, refused to comment on any potential development plans for the mudflats.

International Obligation

In 1992, China joined the Ramsar Convention, an intergovernmental treaty on conservation and the use of wetlands initiated in 1971. From then on, the country has set up over 40 Ramsar sites and listed over 170 wetlands as “of national importance.” In the latest National Report on the Implementation of the Ramsar Convention on Wetlands submitted by China to the Conference of Contracting Parties in June 2012, the Chinese government listed a seNEWSCHINA I October 2012

0

10

20

40 KM

ries of nationwide efforts in enhancing wetland protection, including billions of yuan in investment and subsidies for conservation projects, claiming that China is now in the process of promoting the promulgation of national-level legislation to protect its wetlands. Despite the PR, satellite monitoring conducted and published by the Chinese Academy of Sciences, a State organization, in early February this year indicates that in the past 30 years, China’s total wetland areas have shrunk by 9 percent, or 8,152 square kilometers. WWF China’s marine program officer Wang Songlin said the Luannan wetlands already meet international standards for “wetlands of international importance.” “We urge the local government to set up a protection area in the Luannan mudflats and apply for this status as agreed upon by the Ramsar Convention, as soon as possible,” Wang said at a recent press conference.

37


economy

LED Industry

Dusk of a Dawn A shrinking global market, surplus capacity and a domestic market on lockdown has left China’s smalltime LED manufacturers struggling for survival By Sun Zhe in Guangdong

3

6-year-old Zhang Shuihui is now designer, engineer and storeroom manager at his LED company after he downsized his staff from 80 to three – himself and two salesmen. His entire production line was fired after he ran out of space to store surplus stock. Sales have been in free-fall since April of this year, said Zhang, manager of SX, a manufacturer of LED (light emitting diode) lamps in Zhongshan, Guangdong Province, in the longest slump he can remember. LEDs, used for interior lighting as well as in TV and computer screens, use half the energy of an energy-saving lightbulb with a far longer lifespan, and were once tipped to be the next revolution in lighting. Things haven’t worked out that way for Zhang. “I hope I can pull through the worst of it by going into hibernation,” said Zhang, standing in front of a wall of flashing colored LEDs intended for use in karaoke bars and nightclubs. White-light LED lamps for household usage were displayed on an adja-

38

NEWSCHINA I October 2012


cent wall of his store, which now doubles as Zhang’s office. The cheery effect didn’t seem to be doing much for employee morale.

Surplus

Photos by CFP

Zhang’s company is among thousands of others that swarmed into the LED industry in the past three years after the central government announced that it would promote the utilization of energy-efficient LEDs, in line with an apparent global trend. Five years ago, there were less than 100 companies working in China’s LED industry. Now, there are more than 8,000. A majority are former electronics manufacturers from Guangdong’s Pearl River Delta, who could easily shift their business towards catering for the overseas LED market, at the time concentrated in the US and Europe. Cutthroat competition soon brought prices crashing down. Zhang told our reporter that his company’s sales in the first half of 2012 had declined two thirds from the same period in 2011 because of shrinking demand from Europe. Though LEDs account for about three percent of the global lighting market, this percentage is increasing, and is estimated to reach 10 percent by 2014 thanks to multilateral policy support, according to a report

LED lighting assembly line at a factory in Nanyang, Henan Province, April 12, 2012

NEWSCHINA I October 2012

by Display Search, an industry think tank. However, China’s LED manufacturers have been churning out product way in excess of demand, which has contributed to their current slump. The producers of LED chips, the most important component in LED lamps, are suffering from overcapacity. Over the past three years, in a bid to meet central carbon emissions targets, more than 20 provinces rolled out government subsidies to local LED chip makers. According to Reuters, half of the equipment and premises purchased with these subsidies has been standing idle. A blueprint on LED development released early July by the Ministry of Science and Technology demanded that LED lighting comprise 30 percent of all lighting in China by the end of 2015. The Ministry also planned to increase the value of the industry to 500 billion yuan ($79bn) in the same period. A road map to phase out conventional incandescent bulbs was also released. Starting October 1 2012, the sale and import of incandescent bulbs with 100-watt output or more was outlawed. 60-watt bulbs are set to be banned by 2014, and 15-watt bulbs by 2016. However, uptake has been slow, and hundreds of LED manufacturers have shut down since late last year. Insufficient quality control and a lack of technological provision have also meant that a large proportion of LEDs available are of dubious quality. An investigation by the Guangdong government’s trading standards division last year found that more than half of LED lamps produced in the province were of insufficient quality. Those able to offer high-quality products, however, are still enjoying healthy profits. Wu Huaguang, vice president of Shenzhenbased Joho, another LED lighting producer, saw his sales grow 50 percent in the first half of 2012 compared to the same period the previous year. Wu claims that the implementation of his company’s strictest-ever quality control assessment criteria has allowed him to retain clients and re-invest in new product development. Joho LEDs are now a major player in developed and developing markets, in particular Africa and Indonesia. A price advantage over renowned brands like Philips and Osram has also helped. When asked about the domestic market,

however, Wu told our reporter he had not even considered selling his company’s products in China. “We have no connections in the government,” Wu shrugged.

Exclusive Club

For China’s minor LED lighting producers, the home market is the toughest nut to crack. Subsidies are only offered to LEDs provided exclusively for government projects such as public squares, street lighting, hospitals or government office complexes. By the end of 2011, Guangdong had erected 250,000 LED street lights within the province, boosting the total value of the province’s LED lighting industry to over 150 billion yuan (US$23.5bn) in a single year. The provincial government ruled that all new public buildings would be required to use LED lighting exclusively. In early July, the central government unveiled subsidies of 2.2 billion yuan (US$344m) to promote the utilization of public LED lighting. However, just like fat government contracts, only State manufacturers and those with intimate connections with the government will receive any of this money, according to Yang Yifan, executive director of Guangpu, a Foshan-based LED company. The LED bulb is still considered prohibitively expensive for household use, costing around 10 times the price of a conventional incandescent bulb. Although LED lightbulbs boast 20 times the lifespan and twice the energy efficiency of an incandescent bulb, few householders are keen to make the costly switch to LED technology. Yang believes the only hope is a major reduction in manufacturing costs, which can only come from government intervention. The LED chip, which accounts for about 60 percent of the cost of an LED bulb, is still too expensive, with domestic chips manufactured almost exclusively for export. While the government has pledged to significantly reduce the manufacturing costs of LED chips in the coming years, Yang believes it could take around 10 years for that to translate into LEDs becoming a significant feature in Chinese homes. “Few LED manufacturers will live to see that day,” Yang said.

39


economy

Finance

Bringing

Could an all-new take on the Special Economic Zone allow the newly-reclaimed Shenzhen suburb of Qianhai to tap Hong Kong’s vast offshore yuan reserves?

Photo by CFP

the Offshore,Onshore The next Manhattan? A photo of Qianhai taken on July 13, 2012

By Min Jie, Wu Fan and Li Jia

M

uch of the 15 square-kilometer Qianhai area in the southern boom town of Shenzhen is barren, newly-reclaimed scrub land. But on August 2, 2012, Qianhai’s urban planners received their first bank loan of US$3.2 million, earmarked for infrastructure construction. Like most locals, Zheng Hongjie didn’t know where Qianhai was, but that didn’t stop him from being appointed the head of the newly-created Qianhai Administration in 2010. His task – to create “China’s Manhattan,” or, to use the clunky language of central economic planners in Beijing, a “Shenzhen-Hong Kong cooperative zone in the field of modern service industries.”

40

Creating Wealth

According to a blueprint approved by the State Council, China’s cabinet, every one of Qianhai’s 15 square kilometers will generate US$1.6 billion of GDP by 2020, giving the area 20 times the GDP of Shenzhen and twice that of Hong Kong. Early signs are good. Multi-billion-dollar deals have already been signed with nearly 40 foreign investors. On June 29, 2012, Zhang Xiaoqiang, vice minister of the National Development and Reform Commission (NDRC), China’s top macroeconomic planning agency, announced a list of key sectors that will be encouraged in the program during a press conference in Hong Kong. Unsurprisingly, financial services topped the list. Since its return to mainland sovereignty in

1997, Hong Kong has done more than help propel the Chinese yuan to international status. Its openness to foreign investment and a comprehensive legal framework governing the financial industry has served as an example to Beijing.

Same Dream

Still a fishing village in the late 1970s, Shenzhen, China’s first Special Economic Zone (SEZ), has mushroomed into the fourth richest city in China in terms of net GDP. However, the preferential treatment afforded to the country’s SEZs has been gradually eroded by economic development throughout the rest of China, weakening the city’s competitive edge. In the first quarter of 2012, for example, net GDP in the cities of NEWSCHINA I October 2012


Tianjin, Suzhou and Chongqing had already outpaced that of Shenzhen. With 92 percent of its GDP generated by the financial sector, Hong Kong enjoys an international status among financiers equal to those of London and New York. With coffers housing the world’s largest offshore deposits in Chinese yuan, Hong Kong is poised to be the world’s biggest hub for yuan-based international transactions. Hot on its heels are Singapore, Shanghai, Seoul and London. More than 70 percent of the overseas investment that has underwritten Shenzhen’s economic boom originated in Hong Kong. Shenzhen holds the second or third largest financial assets in the Chinese mainland, and is the “mainland’s second stock market, while there is no third,” said Xiao Zhijia, deputy director of the Shenzhen Municipal Financial Affairs Office, during an online dialog with local business owners. Shenzhen’s proximity to Hong Kong, in many ways the city’s spiritual home, has whetted its appetite for becoming an international financial center in its own right. Many hope the two will deepen their relationship, not least their respective governments. Qianhai could be where this long-awaited match is finally made. Xu Qin, mayor of Shenzhen, described Qianhai as a “springboard, which will propel Shenzhen into the international market and Hong Kong into the mainland market.” In an article in Shanghai Securities News in early January 2012, Charles Li, chief executive director of Hong Kong Exchanges and Clearing (HKEx), noted that Hong Kong could improve its core competitiveness as an international financial hub by serving as the “first overseas home” of the “next international currency,” the Chinese yuan.

(HKMA), yuan deposits with the 134 authorized institutions engaged in yuan business in Hong Kong stood at about US$88 billion by the end of May 2012 - 36 percent of the total non-dollar foreign currency deposits in the territory. Currently, the biggest market for any yuan-denominated business is, unsurprisingly, the Chinese mainland. In the same article, Charles Li of HKEx described Hong Kong’s role as “a kindergarten” from where the yuan, now “in its infancy,” will be able to mature before going international in the future. “Offshore yuan has to be invested back in the mainland market from their overseas “kindergarten,” he wrote in the article. However, capital controls on the mainland remain an obstruction to cross-border loans and direct investment. A draconian approval process means only a trickle of capital makes its way legitimately into China’s mainland economy. Qianhai will be the first place on the Chinese mainland to benefit from the liberalization of these controls. Outside of borrowing from Hong Kong banks and bond issuance, the new Qianhai authorities are also being encouraged to explore any and all ways to tap Hong Kong’s yuan-denominated capital, with policies already in place to cope with a back-flow of yuan to the mainland. In this regard, Hong Kong has another attractive ace up its sleeve. The rules governing the Qianhai operation state that Hong Kong’s experience should be drawn upon whenever the Qianhai Administration formulates regulatory framework for market operations. In

short, Qianhai will, in some ways, work from Hong Kong’s rulebook, not Beijing’s. The administration itself is a semi-independent institution established in accordance with specific ordinances (the so-called Qianhai Rules), making it arguably a “statutory body” in Hong Kong or UK law, and an “independent agency” in the US. The Qianhai Administration can recruit its officials from Hong Kong or anywhere it deems appropriate. The Hong Kong government itself is part of the Inter-ministerial Committee for Qianhai Affairs set up by the central government. Controversies have arisen over these unprecedented steps toward financial openness and regulation. Some have warned that it is extremely difficult to control fluid offshore capital once it returns to shore. Professor Zhang Ming at the Chinese Academy of Social Sciences believes that lax regulation in Qianhai could invalidate all China’s national capital controls, destabilizing the money supply. Others have suggested that the liberalizations don’t go far enough, and urge a wholesale adoption of Hong Kong’s financial regulatory framework in Qianhai. While this has been rejected by Beijing’s economic planners, giving greater leeway to international financial practices is a goal of the Qianhai experiement. “Qianhai has to explore innovative mechanisms for public management in a fully open environment,” Wang Jingxia, a senior official with the Qianhai Administration, told NewsChina. 

Monthly yuan deposits held by authorized institutions engaged in yuan business in Hong Kong

Kindergarten

Policy is already one step ahead of practice. Qianhai will be the first region authorized to broker cross-border yuan-denominated loan agreements between Hong Kong and the mainland. As Qianhai has no banks yet, and the cost of borrowing in Hong Kong is lower than on the mainland, this means that enterprises in Qianhai will soon have access to Hong Kong’s immense yuan pool. Lenders in Hong Kong are reportedly champing at the bit. According to data from the Hong Kong Monetary Authority

NEWSCHINA I October 2012

Source: Hong Kong Monetary Authority

41


Science

Xudabao, two sets Hongyanhe four sets, two sets

China’s nuclear units at all stages of completion (as of December 2011)

Liaoning

Haiyang, two sets, two sets Rongcheng, one set

Operational (15 sets) Approved, under construction (26 sets)

Tianwan, two sets, four sets Fangjiashan, two sets

Shandong

Approved, awaiting construction (5 sets)

Qinshan (I), one set Jiangsu

Preliminarily approved (16 sets)

Qinshan (II), four sets Qinshan (III), two sets

Source: SNPTC

Zhejiang

Sanmen, two sets, two sets Ningde, four sets

Fujian

Fuqing, three sets, one set, two sets Dayawan, two sets

Guangxi

Guangdong

Ling’ao, four sets Lufeng, two sets Taishan, two sets

Hainan

Yangjiang, three sets, three sets Fangchenggang, two sets Changjiang, two sets

Nuclear Restart

Willing, Yet Unable China’s civilian nuclear program is edging toward a full restart, ending the moratorium imposed after the 2011 Fukushima disaster. But can the country train enough qualified engineers to operate the dozens of new reactors the government has pledged to build? By Han Yong and Xie Ying

42

NEWSCHINA I October 2012


Photo by Xinhua

Construction begins on the Sanmen Nuclear Power Plant’s second reactor, Zhejiang Province

A

s Japan’s Kansai Electric brought the Ohi nuclear plant back online on July 1, ending a 14-month government-imposed suspension in the wake of the Fukushima disaster in March 2011, China also began to edge towards terminating its own ban. On May 31, the State Council approved its Security Report on China’s civilian nuclear projects along with its 12th Five-year Plan (2011-2015) for the Nuclear Industry, with the latter setting “security and quality” as top priorities for the country’s nuclear engineers. “The approval of these two documents has set the foundation for restarting nuclear power projects,” Zhao Chengkun, deputy chairman of the China Nuclear Energy Association (CNEA) and also the former director of the National Nuclear Safety Administration (NNSA), told NewsChina. “But we’re waiting on a final document to push the door NEWSCHINA I October 2012

wide open,” he added. The document Zhao was referring to was the State Council’s medium-and-long-term nuclear development plan (2010-2020). The government’s failure to release all three documents allowing the nuclear industry to resume normal operations is, in Zhao’s eyes, an indication of the residual climate of fear following the Fukushima meltdown. “Fukushima made nuclear development a sensitive topic. The development plan cannot be made available before we obtain consensus on some issues,” an anonymous insider at the State Council explained to NewsChina.

Suspension

When the tsunami unleashed by the magnitude-9 Tohoku earthquake hit the Fukushima nuclear plant on March 11, 2011, causing a meltdown and leading to the irradiation of a large rural area, world leaders

were quick to curtail what had been a global expansion of the nuclear power industry. On March 16, 2011, five days after the disaster, China’s State Council held a regular meeting at which Premier Wen Jiabao ordered the suspension of existing nuclear power projects in all stages of development pending a comprehensive security investigation, as well as postponing the construction of new reactors until the country’s entire nuclear administration could be overhauled. As the nine-month investigation came to an end, however, calls grew to restart civilian nuclear development. “China has both the ability and technology to continue to build nuclear reactors,” claimed Wang Binghua, chairman of the State Nuclear Power Technology Corporation of China (SNPTC), at a nuclear forum in May. “Our 13 reactors have a 30-year 100 percent operational safety record and have proven the security of China’s

43


Science China to restart its nuclear program, but we have to strike a balance between speed and quality,” He Zuoxiu, a nuclear academic with the China Academy of Sciences, wrote on his blog in February. “The Fukushima disaster has warned us against a ‘Great Leap Forward’ in nuclear development,” he said.

Photo by CFP

Controversy

Two technicians test radiation levels near the Dayawan Nuclear Power Plant, Shenzhen, Guangdong

nuclear power plants.” On June 5, five days after the approval of the State Council’s nuclear security white paper, the Ministry of Environmental Protection approved a preliminary appraisal of China’s National Nuclear Corporation, which reportedly plans to invest over 170 billion yuan (US$25bn) in five new or expanded nuclear projects. Even the country’s first three inland reactors, which had drawn considerable fire from the public and environmental pressure groups, were believed to get approval soon, which resulted in several listed companies increasing their investment in these projects. “China’s nuclear development lives off the profits of existing nuclear power plants. To halt new projects is to waste huge preliminary investments and to bankrupt at least half the country’s nuclear power equipment suppliers, causing unemployment in the hundreds of thousands,” said a report from a July edition of the Century Weekly.

Demand

China’s rapid advancement of nuclear power sector began with the State Council’s 11th Five-year Plan (2006-2010), in which the government pledged to “actively develop nuclear power” as a policy objective. According to the CNEA, China’s leaders have approved the construction of 34 new nuclear reactors since 2005, of which 28 are already under construction, 40 percent of the global total. Yu Zusheng, a nuclear power expert from

44

the Ministry of Environmental Protection, attributed the rapid development of the nuclear industry to China’s high reliance on fossil fuels, particularly coal. In 2011, according to Yu, nuclear, wind and hydropower only provided for eight percent of China’s total power needs, far lower than the average 20 percent recorded in developed countries. “At present, China’s electricity is mostly generated by combustion, which quickens the consumption of coal and causes huge environmental impact,” said Yu. At the UN Climate Summit held in September 2009, China’s President Hu Jintao described nuclear power development as “one of China’s foremost measures to reduce carbon emissions,” adding that the government intended for 15 percent of the national power supply to come from non-fossil fuel sources by 2020. Observers expect the lion’s share of this percentage to come from the nuclear industry. Given that China is expected to consume 1.6 billion kW of power annually by 2020, insiders estimate that nuclear power will need to provide at least five percent of this total, some 80 million kW, effectively doubling targets set by the country’s first mediumand-long-term nuclear power development plan issued in 2007. Some believe that such a commitment could prove disastrous if China’s nuclear industry is building reactors faster than refining its technology and operational practices. “Due to the considerable economic benefits of nuclear power, it is necessary for

According to He Zuoxiu, China’s nuclear technology lags way behind those of developed countries, despite Chinese reactors generating 40 percent of the world’s nuclear power capacity. A report by the Ministry of Environmental Protection shows that of China’s 34 already-approved power sets, 28 have adopted second-generation technology, the same level blamed for the severity of the Fukushima meltdown. He Zuoxiu believes the causal factors behind the Fukushima disaster, such as the plant’s relative vulnerability to the known local hazard of tsunamis, as well as obsolete technology, should spur China to redesign its nuclear security standards to “take causal factors into consideration.” Chinese officials have refuted claims that China’s nuclear reactors are, like Fukushima, disasters waiting to happen. “China’s nuclear power stations are built on stable bedrock far from earthquake fault zones, and tsunamis rarely hit our coastline,” claimed Zhao Chengkun. “It is unlikely a nuclear accident similar to Fukushima could happen in China.” “Chinese power plants were all built after the 1990s, 20 years after the Fukushima plant, meaning that even though they use the same basic technologies, they have adopted more advanced security,” Yu Zusheng told our reporter. “Fukushima was the result of the earthquake and tsunami, factors the plant’s original engineers failed to take into account,” he added. “After the Fukushima accident, we invited our US partners to test whether the Fukushima plant could have borne the accident if it adopted AP1000 (third generation) technology, and the answer was yes.” AP1000 remains controversial technology, however. At present, only four of China’s reactors have adopted it, all of them under construction and none of which will come online prior to 2013. Even Yu admits that it NEWSCHINA I October 2012


will take a long time, and, likely, a lot of trial and error before China can fully absorb, standardize and domesticate AP1000 technology. “Although the government would prefer to use AP1000 technology, they did not mandate its use in the new white papers. That is why experts are still arguing about it,” he said. A shortage of engineering talent is also a cause for concern. According to Zhao Chengkun, of 23 recorded nuclear accidents in human history, 17 could be at least partly attributed to human error. The breakdown of a generator at Fukushima, caused by worker oversight, ultimately led to the failure of the cooling system, triggering a meltdown. “No matter how advanced a technology is, human error can always override it,” Zhao said. According to Yu Zusheng, it generally takes eight to 10 years to produce a qualified Chinese nuclear technician, 1,000 of which are required to operate a plant with a capacity above 1 million kW. Of the country’s 40 educational establishments with disciplines involving nuclear technology, operations, construction and management are often neglected in favor of design. Indeed, the recent government investigation into nuclear safety described a “lack of scientific management” as the main problem in Chinese nuclear power plants, revealing that China’s first nuclear reactor, built at Qinshan in 1991, still has no contingency plan for catastrophic accidents, with the country’s other three major plants only pre-empting a certain range of potential problems and setting protocols in place to deal with them. At the national nuclear power forum on May 10, Zhang Baoguo, the former director of the State Energy Administration, hinted at a reduction in nuclear output targets to a more manageable 60-70 million kW, but nothing concrete has been revealed by the State Council. “Given that plants with a total output of 40 million kW are built or are being built, the country still has to build 20-30 nuclear power units of 1 million kW capacity apiece in the next three and a half years just to meet its targets,” Yu Zusheng told our reporter. “That is between six and nine units per year in a country with the capability of building only four to five units.” He Zuoxiu is even more pessimistic. “Given China’s weak nuclear technology and meager experience in plant operation, I think the threshold should be limited to the current 40 million kW,” he told Beijing Business. NEWSCHINA I October 2012

china

bynumbers US$2.9bn

NPL/total loan ratio in various banking sectors, Q2, 2012 State-owned Big Five: 1%

Newly-added non-performing Chinese bank loans in Q2. The national NPL rate has increased for three consecutive quarters. Source: China Banking Regulatory Commission

52.8%

12 joint stock commercial banks: 0.7% Urban commercial banks: 0.8% Rural commercial banks: 1.6% Foreign–funded banks: 0.6% 0.0

0.5

1.0

1.5

2.0

Change in China’s outward FDI by regions Jan. – July 2012

Year-on-year increase in China’s outbound direct overseas investment in non-financial sectors from January to July. One third of this US$42.2bn was made through mergers and acquisitions.

Australia: -43%

Japan -27%

ASEAN: 36%

US:30%

Russia: 0.2%

EU 1.2%

Source: Ministry of Commerce

US$756m Decrease in China’s individual income tax revenue in July 2012 compared with the same month in 2011. The total income tax volume has declined for ten consecutive months since October 2011. Structure of China’s tax revenue Jan – July 2012

691m China’s urban population by the end of 2011. China’s urban residents now outnumber rural residents (657 million) for the first time in history.

8% 6%

7%

39%

Source: National Bureau of Statistics

24% 16%

Value-added tax: US$239bn Import duties: US$166bn Corporate tax: US$396bn Individual income tax: US$59bn Consumer tax: US$76bn Others: US$72bn

Source: Ministry of Finance of China

25.5% Increase in fixed investment by China’s private sector for the first seven months of 2012. Source: National Bureau of Statistics of China

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visual REPORT

MAHJONG- VICE

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NEWSCHINA I October 2012


The finals of the 2012 National Mahjong Championships on August 18, 2012 in Chengdu, Sichuan Province, held by the Chengdu Chess Association

E OR VOCATION?

Photos by CFP

A natural cave in Pengzhou, Qingdu has been a popular venue for mahjong games for decades

NEWSCHINA I October 2012

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visual REPORT

In Liangyugang, Jiangsu Province, a coastal man-made Dead Sea-style saltwater swimming resort encourages tourists to attempt a “floating game�

On July 13, 2012, despite heavy rainstorms, locals in Ruichang, Jiangxi Province refuse to abandon a tense game

During the Qingming Festival, April 3, 2011, a day traditionally marked by making

In Huaxi district, Guiyang city, schoolchildren often while away their summer vacation with endless games of mahjong

A local real estate project uses different mahjong tiles to represent different levels of housing 48

Halloween night, 2011, and one Shenyang store NEWSCHINA I October 2012 depicts three dead celebrities in a mahjong display-


A

After the Yingjiang earthquake in March 2011, locals in Yunnan Province set up mahjong tables to pass the time amid the ruins of their homes

ugust 18, Chengdu Chess Association held the finals of the 2012 Sichuan Mahjong Championships. The competition lasted three months and attracted a total of 300,000 participants, all fans of what could be China’s most popular game. The final saw 132 players compete for the title of “King of Mahjong” and a 200,000 yuan (US$31,470) grand prize.  Since its creation during the Ming Dynasty (1368-1644), mahjong has grown into a signature cultural phenomenon, and one of the most popular forms of recreation, and illegal gambling, in China and Chinese communities worldwide. People from Sichuan Province in particular are notable aficionados of the game, and the city’s innumerable public parks and tea houses are typically awash with players from dawn till dusk. Mao Zedong himself described mahjong as one of the three most distinctive products of Chinese culture along with Chinese

Michael Jackson stares down Hong Kong actor October 2012 Mei Yanfang LeslieNEWSCHINA Cheung Iand actress

medicine and the Cao Xueqin novel Dream of the Red Chamber. With complex, regionally-specific rules with echoes of poker and bridge, modern China has a troubled relationship with mahjong, with its detractors labeling it a vice and an addiction. In the 1990s, the Chinese government attempted to issue national regulations on mahjong, which some took to be an endorsement of the game as a legitimate sport on a par with chess, go and Chinese checkers. However, public opposition from China’s anti-gambling lobby saw the plans shelved. Novelist Hu Shi even described mahjong as “a poison that might destroy a whole nation.”  Despite China’s rigorous gambling laws, which prohibit all forms of gambling outside the enclave of Macau, mahjong parlors are as ubiquitous in Chinese cities as grocery stores, and under-the-table gambling, sometimes for vast sums of money, is de rigeur in certain circles.

Photos by CFP

offerings to the dead, one devoted relative offers up a winning mahjong hand

In July 2012, under the blazing sun, four Xi’an peddlers gather for a game in a minivan

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SPECIAL REPORT

Olympic Champions

Whose Medal?

The revelation that two Kazakhstani gold medalists at the London Olympics were transferred from China four years ago has led to examination of China’s “Wolf Raising Plan” in competitive sports

Photo by CFP

By Tang Lei in Hunan and Wan Jiahuan in London

Chinese-born Zulfiya Chinshanlo wins gold for Kazakhstan in the women’s 53kg clean-and-jerk on June 26, 2012

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NEWSCHINA I October 2012


Photo by CFP

China has become a major training ground for international athletes, such as Korean ping-pong player Oh Sang Eun

Back at Home

While her profile on the official website of the London Olympics lists her birthplace as Almaty, Kazakhstan, Zhao’s hometown is in Daoxian County, deep in the mountains two hours away from Yongzhou, Hunan

NEWSCHINA I October 2012

Photo by CFP

O

n July 29th in London, 19-yearold Kazakhstani female weightlifter Zulfiya Chinshanlo won gold in the women’s 53kg clean-and-jerk, setting a new world record in the process. Two days later, 26-year-old Maiya Maneza won Kazakhstan’s second weightlifting gold, and set an Olympic record in the women’s 63-kilogram category. In these two events, no Chinese athletes made the top ten. The cheering crowds were likely unaware, however, that both women were born, raised and trained in China. Zulfiya’s Chinese name is Zhao Changling, and Maiya’s is Yao Li.

Cai Zhenhua, former head of the Chinese Pingpong Association and current vice director of the National Sports Bureau

Province. On the night of the weightlifting final, her father Zhao Guisheng and mother Peng Zhuluan sat in front of the television, accompanied by some thirty relatives from the village, waiting anxiously for their daughter’s turn. When she won, the entire village erupted in celebration. Within half an hour after the event, Zhao Changling called home and said to her father: “Dad, I made it! I’m a little busy right now, I’ll call you back soon.” Back in London, she had just received a congratulatory phone call

from Kazakhstan’s president. After her win, local officials from the sports bureaus of both Hunan Province and Yongzhou City came to Zhao’s home to offer their congratulations to her parents. Local television stations interviewed the couple, and repeated the broadcast several times. Zhao Guisheng and his wife run a small bakery in Daoxian. Although their daughter does not live at home, they keep her room tidy and organized. Her furniture was all purchased with the money she earned as an athlete in Kazakhstan. The Kazakh sports authority gives her a monthly salary of 2000 to 3000 yuan (US$314-471). Since going to Kazakhstan, Changling has returned home once a year, and sends tens of thousands of yuan annually to her parents. Each time she comes home, she only stays for one week at a time, before resuming her training in either Yongzhou or Changsha, the provincial capital. On the dressing table in her room at home, there is a photo frame with a picture of Zhao with Yao Li, the other Chinese athlete living in Kazakhstan. “Thankfully Yao Li is also there [in Kazakhstan], otherwise our Changling would be lonely,” Zhao Guisheng said to NewsChina.

Lifted

When it was revealed in the Chinese media that these two Olympians were born in China, domestic audiences reacted with confusion. During the NewsChina reporter’s stay in Yongzhou, even local taxi drivers decreed that no matter how many gold medals an athlete wins, it means nothing unless they are representing their native country. In 2003, aged 10, Zhao Changling was chosen by Yongzhou City Sports School to train as a weightlifter. Gradually, she got used

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SPECIAL REPORT

Doubts

Zhao’s victory aroused significant media attention. Overseas media, including the BBC, began to connect “Zulfiya,” “Maiya” and Li Jiawei (a female ping-pong player recruited by Singapore in 1996, who later became Singaporean and also competed in London) with a so-called “Wolf Raising Plan” initiated

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by the Chinese ping-pong team in 2009. For years, Chinese ping pong players have dominated various world-level competitions, leading to dwindling enthusiasm for the sport outside of China, and the possibility that it could be delisted as an Olympic sport. The Wolf Raising Plan was formulated as a way of assisting the development of foreign teams, in the hope of saving the Chinese team in the long term. In early 2009, Cai Zhenhua, former head of the Chinese Ping Pong Association, came up with a plan to support its global popularity. Taking a “going out, inviting in” approach, the project aimed to improve the skill levels of foreign table-tennis teams, training their opponents to become “wolves.” It was reasoned that through mutual training exchanges with foreign countries, those countries might stand more chance of winning, causing a resurgence in the sport’s popularity. Adham Sharara, president of the International Table Tennis Union, once expressed his support for the plan in principle, but stated that the key was how to adopt it in practice. He suggested that the Chinese team should invite players from other countries to train alongside them, and allow China’s top coaches to train teams overseas. In practice, however, emphasis was placed on inviting foreign teams to take part in Chinese domestic matches. Only a small number of foreign athletes were allowed to join training programs with Chinese provincial teams. Meanwhile, the secrets of the national team’s training program remain closely guarded, and non-Chinese athletes have never been allowed to participate. Several years later, “wolf raising” was showing negligible results – Chinese teams continued to dominate. Cai Zhenhua admitted in 2011 that the plan had been a failure, and since then, it was rarely mentioned. That is, until two suspected “wolves” took home gold medals for another country. However, whether or not Zulfiya and Maiya are indeeed “wolves” remains unclear. Both were transferred overseas in 2008,

long before the plan was officially launched. “There is no record, oral or written, of the plan being mentioned in connection with the weightlifting team,” Yi Jiandong, a wellknown sports researcher, told our reporter. “Women’s weightlifting was adopted into the Olympic Games in 2000, so there was no need for China to consider [the sport’s popularity] at the time.” According to a source inside China’s domestic sports circle, Zhao will return to China after a “five-year contract” between the two countries expires, and will take part in China’s national sports competitions as a Chinese citizen in 2013. When the Xinhua News Agency asked Zhao if she would come back to China after she won her gold medal, she said: “I have no idea.” Li Gui, Hunan Provincial Sports Bureau chief told NewsChina: “It is still not certain whether or not Zhao will return. It is hard to say anything about it now, considering the sensitivity of the issue.” Zhao Guisheng, however, is confident about his daughter’s future: “I have said that if she can come back next year and represent our country, I will expand my bakery business. But I don’t know about the government’s arrangements yet. It all depends on the country’s decision.”

Photo by CFP

to the exacting lifestyle of a young athlete in China: 5:30 AM wake-up calls for earlymorning exercise, before academic classes in the morning and intensive weightlift training in the afternoon. Five years later in 2007, Zhao made the Hunan provincial team, and was noticed by members of a visiting Kazakh weightlifting team. Later, Zhao moved to Kazakhstan to continue her training, eventually becoming a citizen. A report from China’s Xinhua News Agency on April 14, 2007 claimed that during a visit to Kazakhstan, Liu Peng, head of China’s General Administration of Sports, had signed a cooperation agreement with his counterpart in the Kazakhstan Sports Ministry. In another Xinhua report, according to Zhou Junpu from the Hunan Provincial Sports Bureau, Zhao Changling and Yao Li, both from the Hunan weightlifting team, were transferred to Kazakhstan in early 2008. Before the Chinese sports delegation set off for this year’s Olympic Games, Zhou Junpu once again confirmed this to the media. Yet the details of the agreement, including whether or not Kazakhstan paid or continues to pay “transfer fees” to China, have not yet been publicized. Neither the Kazakhstani weightlifting team nor the Hunan side has commented on the matter. “It is a good thing for athletes who can’t get out of the ruck in the domestic sports circle to gain overseas opportunities,” said Li Gui, vice director of the Hunan Provincial Sports Bureau, to the reporter, “yet domestic audiences misunderstand the reasons why Chinese-born athletes are representing foreign countries.”

Maiya Maneza won gold for Kazakhstan in the women’s 63-kilogram category during the London Olympics, despite having been born in China NEWSCHINA I October 2012


2012 Olympics

Faded Gold

Z

After another impressive medal tally in London, China is beginning to perceive a disconnect between Olympic victories and the Olympic spirit

Photo by Image Forum

By Sun Zhe

NEWSCHINA I October 2012

hou Jun, a 17-year-old weightlifter, failed to execute a single successful lift in her event in London, a performance the Yunnan-based newspaper Urban Times described as “a humiliation.” The report led to a furious online backlash and the newspaper was forced to print an apology the following day. Wu Jingbiao, another Chinese weightlifter, broke down in tears after narrowly missing out on a gold medal. “I let down the mother country…the national team…and all those who care about me,” Wu sobbed during an interview with State broadcaster CCTV. On Weibo, China’s Twitter equivalent, more than 56,000 netizens responded to an apologetic post from Wu with words of consolation and encouragement. Such sympathetic treatment of Olympians would have been unthinkable in the 1980s, when anything other than a gold medal was equated with failure, both by the State media and the Chinese population as a whole. This sensitive, supportive treatment of Zhou and Wu would be envied by some of China’s older Olympic athletes. On his way to the 1984 Los Angeles Games, Zhu Jianhua was seated in First class alongside top officials from China’s Olympic delegation. Then 21 years old, Zhu had broken three high jump world records that year, and his home nation had pinned its Olympic gold medal hopes on him. Zhu left Los Angeles with a bronze medal, which made him China’s top track and field athlete of the 1984 Games, but also meant he traveled in economy class on his way home. First class was for the country’s 15 gold medalists and officials only. When he arrived, he discovered an angry crowd surrounding his Shanghai apartment, cursing his family and smashing his windows. Bronze, apparently, wasn’t even close to good enough for his compatriots. Four years later, Li Ning, then China’s national gymnastics star who had racked up six medals in Los Angeles, three of which were gold, slipped from both the rings and the

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SPECIAL REPORT

pommel horse in Seoul, arriving home emptyhanded. The Seoul Olympics was seen as a national embarrassment, with the country’s athletes returning home with a mere five gold medals. Li himself received razor blades and nooses in the mail for months afterwards from fellow countrymen demanding he kill himself for bringing shame on China.

Softer Landings

During the Beijing Olympics in 2008, which saw China spend US$42 billion, expectations of the host nation’s athletes to showcase China to its citizens and the world were even higher. China swept the board with a total of 51 gold medals, making it the first nation other than the US and the former Soviet Union to top an Olympic medals table since 1936. Yet, as Russian and American athletes can attest, with so much gold around, the shine begins to wear off. In the era of the Internet, spectators are increasingly aware of the personal stories behind their nation’s sporting heroes. With all national-level sportsmen and women exclusively on the State payroll, the General Administration of Sport of China (GASC) uses Olympic gold medals as indicators of which athletes are doing their jobs properly. There is little importance attached to participation, unless it leads to outright victory. This attitude at the top has, for decades, bred a similarly workmanlike attitude towards professional athletes from their home crowds. “The country offers you free room and board and excellent training conditions. How is it OK to fail to make the podium?” Liang Xiaolong, a GASC official, told NewsChina. Only China, North Korea and Cuba still adhere rigidly to an entirely State-run sports system modeled on that of the former Soviet Union, consisting of multiple tiers of sports bureaus and State-funded sports schools that attempt to nurture sporting talents from a very young age. The system was designed to identify and train the best athletes capable of winning glory for the country on the global stage. “Some may say we need to de-emphasize gold medals, but how do you think people would react if China fell out of the top three or four in the gold medal rankings?” Liang continued. “Theoretically, any medal should

54

be satisfactory as long as the athlete has tried their best in the sportsmanlike Olympic spirit. But, to be honest, gold is gold.” Indeed, gold can mean life or death for a Chinese athlete born into, and entirely beholden to, the State. Gold medalists are instantly signed up for numerous brand endorsements, with royalties split between the athlete, their coaches and everyone else connected to them in the GASC. Coaches stand to profit the most, with gold medals meaning promotion to the GASC’s highest offices – former bureau deputies include some who started their careers as ping pong and volleyball coaches before leading Chinese teams to Olympic glory. Even a gold medalist’s hometown can bask in their son or daughter’s Olympic glory. After Chinese 10-meter air rifle competitor Yi Siling won the country’s first London gold, her family’s apartment complex in Hunan Province was festooned with red congratulation banners sent by the government, which proceeded to set off an hour-long firework display in her honor. By contrast, Li Xuanxu, also from Hunan, who won bronze in the women’s 400-meter individual medley, was met by her mother and an aunt at the airport, where no bystanders recognized her. This all-or-nothing attitude to sporting achievement has begun to grate with China’s younger generation. The GASC, China’s gold medal factory, has recently been singled out for particular criticism, especially the administration’s harsh treatment of “underperforming” athletes, which usually sees those who have failed to make an Olympic podium forced into a retirement which borders on social and economic exile. Having been effectively raised by the country’s sports administration, retired and injured athletes find themselves on the scrap heap with no formal education and a lack of transferable skills. Zhang Shangwu, a former gymnastics world champion, was photographed performing for money on the streets of Beijing after being forced to retire after he ruptured an Achilles tendon. Zhang’s fate, working as a street performer, could be seen as preferable to the ignominy faced by some of his “retired” peers. Chai Li, a NEWSCHINA I October 2012


Photo by CFP

Liu Xiang sits on the track after crashing out of the 110-meter hurdles, London, August 7, 2012

weightlifting champion who competed at the Asian Games, was working as a security guard at a Liaoning gymnasium when he died from sleep apnea, a side effect from years of extreme weight training, at age 32. According to local media, he had only 300 yuan (US$47) in his bank account at the time of his death. Another retired weightlifting champion Zou Chunlan worked in a public bathhouse, mainly because the job included accommodation along with a monthly wage of 500 yuan (US$78). The pursuit of Olympic glory costs some athletes dearly, particularly when they fail to achieve the top spot on the podium.

Photo by Xinhua

Expensive

Photo by CFP

Chinese weightlifter Wu Jingbiao misses out on a gold medal, London, July 29, 2012

Wang Xiaoli and Yang Yu are disqualified from Women’s doubles badminton, London, July 31, 2012 NEWSCHINA I October 2012

Even though China came second in the medals table in London, with breakout stars in a number of unexpected events, anyone browsing the country’s online forums could well have questioned whether debating the cost of the country’s gold medal hoard was becoming China’s fastest growing sport. With every medal effectively paid for with taxpayers’ money, some attempted to calculate the dollar value of each gold medal. Others took this line of questioning further, to ask if sporting performance was any indicator of a country’s relative strength and worth – an assumption which has driven Olympic fever in China for three decades. According to a report by the Beijing Evening News, training up China’s star swimmer Sun Yang, who won two gold medals in London, cost the Chinese taxpayer 10 million yuan ($1.57m) over two years. Sun, along with China’s second aquatics gold medalist Ye Shiwen, was trained by star coaches in Australia as part of the GASC’s “Project 119,” launched after the Sydney Olympics in 2000 to boost funding in China’s weaker Olympic categories – namely, track and field, aquatics and water sports. Though a majority of the gold medals won by China since the country’s first Olympics in 1984 were won in minority sports like weight lifting, diving, table tennis, shooting, badminton and gymnastics, sports which tend to favor State-supported athletes, Project 119 had allowed China to clinch medals in key categories, allowing it to leapfrog countries like Australia, France and Great Britain to snap at the

US’s heels on the medals table. In contrast with the big money squandered on maintaining the face of sports officials and the country, access to a swimming pool is a rarity for average citizens. According to the latest government statistics, China has 6.58 sporting venues, including gyms, stadiums and sports fields, for every 10,000 citizens. The same number of Japanese have access to 26 venues, Germans 24.8 and Swiss 22. While all these countries have come below China in Olympic performance for a decade, their citizens have four times more opportunities than the average Chinese person to actively participate in sports. According to a GASC survey released last year, the overall physical fitness of Chinese youth below college age has been in steady decline for the last five years. Despite occasional gold medals from the swimming pool and the track, the outcome of a lack of mass participation in “majority sports,” such as swimming, track and field and team sports, which generally require popular participation on a large scale to translate into gold medals, started to show at the London Olympics. China’s failure to enrich its domestic sports teams – particularly the “Big Three” of basketball, soccer and volleyball leagues – due to a lack of young talent is being blamed on the State monopoly on sports administration. China’s soccer and men’s volleyball teams didn’t even make it to London, and all its other teams failed to progress beyond the quarter-final stage of any competition. Despite arguably representing the most popular grassroots team sport in a country of 1.3 billion, the men’s basketball team did not win a single game. After world women’s badminton doubles champions Wang Xiaoli and Yu Yang were disqualified for deliberately trying to lose a match to avoid facing their compatriots in the semi-finals, even Yao Ming, still China’s foremost sports personality, stepped into the debate, commenting that sporting performance mirrors the “values,” rather than the “value” of a people. “If a gold medal carries more weight than our values, then I have to say our values are worth a lot less than gold,” Yao told the Stateowned Xinhua News Agency.

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culture

The China Beat As electronica gains popularity in China’s alternative music circles, the country’s DJs and producers are beginning to turn heads in nightclubs across the world By Alex Taggart

Photo Courtesy of Li Man

INTRO electronic music festival in Beijing, May 26, 2012

Chinese DJ and producer Li Man performs in Cologne, Germany, July 28, 2012

A

t 2 AM on August 12, as Chen Jiesi steps on stage at the Subland nightclub, a dark, noisy venue in the Friedrichshain zone of Berlin, neither she nor the roughly 500-strong peak-time crowd in front of her know quite what to make of one another. Not only is this 27-year-old Chen’s first time outside of China, she is also one of the first Chinese DJs ever to perform in this

56

city, arguably the electronic music capital of the world. “I think they booked me because having a Chinese person on the bill was a novelty for them. But after I’d finished, the promoters tried to book me for another show, and people wanted to take photos with me. They said I was the best performer that night,” said Chen, a neuroscience researcher at Sun Yat-

sen Medical University in Guangzhou by day. Summer 2012 has been something of a watershed for the more globally ambitious of China’s electronic dance music (EDM) DJs. Chen, or “DJ JCC,” is one of several to embark on a European tour in recent months. In mid-August, a “delegation” of the country’s top DJs visited Germany and Switzerland, with some of them performing at the Street Parade in Zurich, an annual outdoor party that this year saw an estimated attendance of 950,000. Since EDM arrived in China’s big cities two decades ago, it has remained a decidedly “underground” affair, hidden away in obscure venues far from the country’s burgeoning mainstream nightlife culture. In the 1990s, while China’s rock bands were busy building the country’s most popular modern subculture, electronic NEWSCHINA I October 2012

Photo Courtesy of INTRO electronic music festival

Electronic Music


music parties in Beijing, Shanghai, and Guangzhou could scarcely attract enough people to cover their equipment rental costs.

Sound of the Underground

“It didn’t really grow very much in the early years, but we formed a very tight-knit group. The people who were around at the very beginning are now in their forties, but even now, they’re still there every weekend, pushing the culture forward,” said Miao Wong, founder of Acupuncture Records, one of China’s first EDM record labels. The dozen past and present members of Wong’s Beijing-based stable of DJs and producers have been involved in almost every electronic music-related project in China’s history. With the advent of the Internet, more Chinese youth began to explore different styles of music, and over the past two decades, the gatherings have gradually grown from a few dozen people to several hundred. Parties have moved from dive bars into respected live music venues, purpose-built nightclubs, converted factories and dedicated outdoor festivals. “Back when we first started, if you grabbed someone on the street and asked them what a DJ was, they wouldn’t have known,” said Wong. “Nowadays, most people in cities are aware of the concept, even if they’re not electronic music fans themselves.” Gradually, fans of “alternative” music styles in China are becoming exposed to EDM, and getting involved in their local music scenes. “Because of how quickly technology is developing, it’s now very easy to start making electronic music,” said Howie Lee, a 27-year-old full-time EDM producer from Beijing. Having released several songs on both domestic and foreign record labels this year, Lee is perhaps China’s most promising electronic music artist. With a degree in sound engineering, Lee had something of a head start on the competition. However, he argues that these days, getting started in the music business isn’t as hard as it used to be: “It’s not like playing a traditional instrument, where you might need to practice for ten years before you can get up and perform. With electronic music, all you need is a computer and an idea. It’s incredibly easy for young Chinese people to NEWSCHINA I October 2012

put down their video games and start exploring their own sound.” However, Lee admits that at least in the short term, Chinese electronic musicians may be limited by their artistic boundaries: “In China, the education system doesn’t encourage creativity. Some children learn piano for 10 years without ever thinking that they could write music for themselves. And of those who do make electronic music, most just copy Western styles, rather than trying to create a Chinese style,” added Lee. Even those who develop a marketable product have little chance of making it big in their home country – in China, being a music producer is an even riskier career choice than it is in the West. With music sales plummeting due to online piracy, China’s EDM world has effectively given up on making money from selling MP3s, and most producers rely on fees from often-restrictive performances in mainstream nightclubs. Many, Lee included, choose to make their music available to download for free online, simply to raise their profile. “When I tour around China, I often play in big clubs,” said Li Man, a flamboyant Chinese producer who performs wearing a headdress made of glow-sticks, “but while the crowds are huge, there will only occasionally be one or two people there who came because they like my music.” Increasingly, however, Chinese electronic musicians are finding ways of making a living without straying too far from music production. “The producers with the most talent and the best connections can now get high-paying jobs making movie soundtracks, doing sound design for advertisements, or producing songs for pop singers,” said Chen Jiesi. On a larger scale, the development of EDM culture faces a more daunting obstacle. While China now sees dozens of largescale electronic music events every year, bureaucratic interference is commonplace. In May this year, Acupuncture Records’ annual 10,000-strong outdoor festival, INTRO, was forced to change its location with less than 24 hours to go. “Our application for a license to hold the event in 798 [an art district near Beijing’s city center] was rejected at the last minute. We

got approval from the Ministry of Culture, but not from the Public Security Bureau, so we had to move the party to a vacation park near the city limits,” said Miao Wong.

Electronomics

Still, despite the jitteriness of China’s authorities when it comes to independent arts, some still see long-term commercial potential in China’s EDM industry. 27-year-old Frenchman Max Bureau has been involved in the independent music scenes in Beijing and Shanghai since his arrival in China in 2005. Having run several successful “underground” electronic music nightclubs in Beijing, his latest venue, Haze, is attracting a wealthier, more mature breed of Chinese consumer to the world of electronic music, right in the middle of Beijing’s CBD. A clean, fashionable club with just a hint of an “underground” motif, Haze hosts one or two well-known international DJs per month, as well as the cream of the local crop. In contrast to the grungy crowds that tended to frequent his previous businesses, Bureau is attempting to change EDM’s image in China with the use of subtle gentrification. “A lot of cosmopolitan, white-collar Chinese workers like to go out at night, but some of them are getting tired of the seedy mainstream nightclubs, so they come over to Haze. Most of them are new to this kind of music, but they keep coming back, and they have money to spend.” While Bureau stops short of predicting that EDM could ever become part of China’s mainstream music culture, he believes there is room for development: “We’re seeing more and more small venues like ours popping up, and investors are interested in our product. It definitely has the potential to become something big here.” For Miao Wong, however, the objective has never been actively to convert Chinese music fans to EDM. “All we’ve ever tried to do is to create opportunities for young Chinese people to hear electronic music, or to experience one of our events. There could be millions of potential electronic music fans all over China, but if they never hear it, they’ll never know. We just want to let people know that this culture exists, and let them decide for themselves whether or not they like it.”

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culture

3D Painting

Illusions of Grandeur

3D street painting, a form of street art that has been gaining popularity in China, has found its way into the State Guesthouse By Tang Lei

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hortly after Chinese New Year 2012, Guangzhou-based artist Wan Yiju took a phone call from the guards regiment of Diaoyutai, China’s prestigious State guesthouse in Beijing. The caller asked if the artist and his twin brother, Wan Yiheng, who have made a name for themselves in recent years with their “3D street paintings,” would be interested in bringing their work inside the hallowed halls of the Diaoyutai. A modern take on the trompe l’œil technique, 3D street painting creates the illusion of a three-dimensional effect on a two-dimen-

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sional plane (usually the ground). This art form originated roughly three decades ago in the West, with artists often crafting their illusions on huge areas of pedestrian streets. The style was introduced to China around seven or eight years ago, and is therefore still foreign to many Chinese. However, Diaoyutai State guesthouse, a place that has hosted visiting foreign dignitaries including Richard Nixon and Ronald Reagan, showed a somewhat surprising interest in the art form. “It did surprise us. I was under the impression that only traditional works, the kind

with flowers and landscapes, were displayed there,” said Wan Yiju, the elder of the twins. “They said they were very interested in our works because our techniques were innovative and different. Eventually, they asked me if we could create a work for them that incorporated Chinese elements.”

Trick of the Eye

Genetically identical, the Wan twins are well practiced in what they call “the art of illusion.” Often mistaken for one another, they say that their paintings create a confusing effect, not NEWSCHINA I October 2012


All photos courtesy of the Wan brothers

The Wan brothers pose with their work Old Summer Palace

unlike when the two stand next to each other. Before arriving in Beijing to discuss the project, the brothers had always imagined Diaoyutai as a palace, akin to the Forbidden City, Beijing’s ancient imperial seat. “These buildings have modern interiors, and are quite different from what we had imagined. The layout and decoration was very comfortable, but it was not the kind of opulence you might expect,” Wan Yiheng told NewsChina. “We were shown their art collections, most of which were in traditional styles.” NEWSCHINA I October 2012

The Wan brothers’ patriotic 3D painting, specially created for the State Guesthouse, on display

During consultations before the work began, the guards made clear their requirement that the Wan brothers’ painting should “reflect the Chinese spirit with a peaceful mood,

while expressing the idea of defending the motherland.” “To begin with, they had no specific ideas about what the content of the paint-

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culture

ing should be,” said Wan Yiheng. “But after we were shown around, we had some ideas of our own. We explained our concepts to them, and they agreed.” The guards proposed that a panorama of Diaoyutai be framed in the picture, but the Wan brothers advised against the idea, saying that the picture should give viewers a general idea of China, not just of Diaoyutai.

Crafting an Illusion

Since the 3D effect in a Wan brothers painting varies according to where the painting itself is placed, every potential angle in the building had to be examined, and given the limited space for the painting in Diaoyutai, it was also necessary for it to be easily removable. Wan Yiju and Wan Yiheng measured a number of locations in Diaoyutai where the work might be placed, and ultimately decided to stretch the painting across a relatively large patch of floor and wall. “After a few exchanges, we found that they liked the style very much, and that they were looking for a change,” said Wan Yiju to NewsChina. Upon returning to Guangzhou, the brothers began drawing sketches on the theme of China’s military might. “Aircraft and artillery certainly demonstrate national strength, but we felt something was going astray. Was this going to be a show of force? China advocates peace, and for this reason, we rejected these elements,” said Wan Yiheng. In their previous creative endeavors, the brothers would bring their respective ideas together, discuss them, and exchange opinions. If a disagreement cropped up and they were unable to convince each other, they would take some time apart, and debate again after having calmed down. Predictably, the Diaoyutai project required even more patience and understanding than usual. While working on sketches, the Wan brothers often exchanged ideas with the guards at the guesthouse. The guards suggested including images of themselves in the painting, a suggestion that the Wan brothers politely declined to incorporate. “We have the right to speak up where our art is concerned,” said Wan Yiju. “They lis-

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tened to us. They would accommodate, as long as our exchanges did not touch upon politically sensitive issues.” The whole painting—100 square meters in area—comprised two parts: one to be hung on the wall and another to be laid on the ground. The part on the wall showed a grand open gate with Beijing’s Tian’anmen Rostrum standing in the center. The part to be laid on the ground was in the form of an unfurling scroll, plunging into a long, deep gorge in the center, through which a golden river weaves its way from the edge of the painting towards Tian’anmen. “Red represents China, and it is the dominant color in the painting. The painting also shows the beautiful rivers and mountains of the country,” said Wan Yiju. “Actually, there are not too many separate elements in the painting, but even at a glance, it is unmistakably China. The rolled-out scroll represents a new chapter, while the open gate allows people of the world to take a look at what China is today.” It took two months for the Wan brothers to complete the painting in their Guangzhou studio, before it was transported to Diaoyutai in Beijing. “The guards were surprised when they saw it for the first time. One guard lay on his stomach on the painting for a photograph, as if he was flying across it. This earned him a telling-off from a colleague, but it was OK with us. People need to interact with a 3D painting like this,” said Wan Yiheng.

Special Environment

Before the Wan brothers went to high school, their artist father forbade them from learning to paint. At the time, their father Wan Zhaoquan, a famous sculptor, believed that art was a thankless job. He did not want his twin sons to follow in his footsteps. Unpersuaded, Wan Yiju and Wan Yiheng made illustrations in their textbooks. However, their parents found out and tore up their textbooks. “Our father was convinced that there were no prospects in art,” said Wan Yiju. “But we began painting on the walls. It was impossible to tear up a picture on the wall. As I was painting one picture, my younger brother would paint another at the

same time, but the two were strung together by the same story line. ” “Because our father didn’t teach us, we didn’t learn art in our childhood. So we were never brainwashed. Since childhood, we absorbed whimsical things from foreign books, and our minds wandered freely. Basic skills can be acquired, but creative ideas cannot,” said Wan Yiheng. Now that he is famous, Wan is invited to lecture at colleges and universities. He encourages young students to rack their brains for creative thoughts and ideas.

Use Your Illusion

So far, the Wan brothers have completed more than 80 3D paintings, and have been commissioned by clients in the Chinese mainland, Hong Kong, Taiwan, Singapore, and elsewhere. The Guangzhou Tower, where a new Wan brothers piece was exhibited at the end of July, looms in the distance behind the art gallery where the rest of their works are on display. The walls and floors of the gallery are covered with 3D paintings, the theme of which changes every year. For 2012, the pair have created a work called The End of the World, which gives the impression of a flooded, shark-infested gallery. 3D painting now enjoys a modicum of popularity in China, but skill levels of painters vary – many stick to imitating popular Western works. The Wan brothers are among a select group of artists who have taken the style into interesting new territory in China. “Some people think that painting is very dull, and art is too esoteric and detached from people’s daily lives. But the art we advocate can be exhibited in galleries and also on the street, making it highly accessible to the public. Our aim is to change their attitudes. As more and more people are attracted to art, we can change a lot of things,” said Wan Yiheng. In the design industry, 3D painting is one of the most time-consuming and lowestpaid jobs, but it is what the Wan brothers love the most. “Artists often abandon their ideals gradually for the sake of survival. But we are led by our love of art. This is of paramount importance to us. ” NEWSCHINA I October 2012


history

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attered by frequent rainstorms and typhoons this summer, many flood-prone regions in China have hastened to drain their reservoirs, for fear that the dams that hold them in could burst at any moment. “In extreme weather, like storms and typhoons, dilapidated dams pose a serious safety risk,” warned Liu Ning, China’s vice-minister of water resources. “Mostly built during the Great Leap Forward [1958-1960] and A dyke is destroyed by the Cultural Revolution [1966- floodwaters 1976], ‘risk dams’ refer to those that fall under national criteria for being vulnerable to floods or incapable of functioning as originally designed,” Xie Huiliang, a retired senior hydraulic engineer, told NewsChina. According to a research project jointly conducted by the Ministry of Water Resources and the Ministry of Finance, about 200 “risk dams” collapsed in China each year between the 1950s and 1970s, the most devastating of which Survivors struggle in the water happened in 1975 – the Banqiao Dam disaster, in Zhumadian city, central China’s Henan Province. In 2005, the Discovery Channel listed the Banqiao collapse as the world’s largest technological disaster, alleging that 240,000 were killed. “The Henan dam burst was no less destructive than the Tangshan earthquake in 1976 [believed to be the deadliest earthquake of the 20th century, with an estimated 242,769 killed], but few Chinese people know about it,” Chen Bin, a witness to the disaster, told NewsChina.

‘Dragon!’

On August 5, 1975, the year’s third-largest typhoon took shape off the coast of the southern province of Fujian, moved northwest and hit Henan Province, bringing with it record rainstorms. “Everything was hazed over by the downpour. We could not see or hear anything several steps away…flocks of birds were knocked out of the sky by huge raindrops,” said Chen. According to meteorological statistics at the time, the precipitation over the 20,000 square kilometers of land struck by the typhoon registered 400-1,000mm between August 5 and 7, with Linzhuang village in

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Zhumadian city seeing the heaviest – 830mm of rain fell within six hours, roughly equivalent to the annual rainfall in an average year. The storm quickly raised water levels of the upper reaches of the area’s rivers, putting immense pressure on reservoirs and causing small dams to collapse one after another. The runaway flood poured over the broken dams and eventually struck the Zhumadian area, the site of the Banqiao Dam, one of the four largest dams in the province. “At 9 PM, August 7, the water level was 2 centimeters below the top of the dam, but it spilled over at midnight,” records the book Henan Flood Disaster in August 1975 by the Post-disaster Shahedian town of Henan Provincial Zhumadian city Water Resources Bureau in 2005. “People were still trying to hold back the mounting torrents by reinforcing the dam [with sandbags]...when suddenly there was an overwhelmingly violent crash. The violent deluge poured down through the collapsed dam,” the book continues. “Some shouted in terror that ‘the dragon’ [local slang for a flood] had arrived.” “The disaster happened overnight. When I woke up, I found the flood water reached up to my knees,” Chen Bin told NewsChina. “We were lucky to have enough time to flee, while many people were drowned in their sleep.” Chen Zhijia, who worked at the Banqiao Reservoir at the time, said it seemed as though “the world was disappearing.” “I didn’t know where I was – just floating around in the water, screams and cries ringing in my ears. Suddenly, all the voices died down, leaving me in deadly silence,” he recalled in a history program by China’s State broadcaster CCTV in 2010. “The flood overran our village, uprooting the trees and smashing the houses to pieces. All the villagers clinging to the trees and perching on the rooftops were engulfed by the mountainous waves…I was surrounded by a vast ‘sea,’ with naked human bodies and dead animals floating by,” recalled Wu Futang from Weiwan village, in World’s Largest Dam Burst – Zhumadian Flood in 1975, a 2005 book by scholar Qian Gang. Two days later, Wu Futang groped his way back to his home village, only to find heaps of ruins littered with human and animal corpses. NEWSCHINA I October 2012


NEWSCHINA I October 2012

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Photos from Henan Flood Disaster in August 1975 by Henan Provincial Water Resources Bureau

Henan Flood Disaster in August 1975, and famine, though no government the government-sponsored book, redocuments or records have ever revealed cords the deadly flood with stark figthis information. ures. “Two large dams, Banqiao and Zhang Hongcai, a medical worker Shimantan, plus two medium-sized and with the rescue team in the Zhumadian 58 small ones were broken down by the area, described in the CCTV program flood. Nearly 10 billion cubic meters of how serious the epidemic was. “Piles of water created 10-meter-high waves and bodies were left in the sun, giving off ravaged the whole Zhumadian area in a an unbearable stench. Branches and matter of hours. More than four million poles were crawling with swarms of flies, The flood basin, located in Xiping County, Zhumadian city people in 30 counties were trapped in looking like thick dark ropes from a disthe water, with five million houses and tance,” he said. one million animals washed away. The “They (flies) were in such huge numrailway section across the area became twisted, cutting off transportation bers that the government had to send in airplanes to spray pesticides. for 16 days.” About 248 tons of pesticide were used,” Kong Fanbin, then rescue commander, told CCTV. Death Toll Their testimony is verified by archival records in the disaster-hit regions. Despite the enormous scale of the disaster, the 1975 dam burst re- For example, a government document from Suiping County revealed mained unknown to the Chinese people at large. The catastrophe was that 240,000 were infected with various diseases, and altogether 12,527 covered up until the 1990s, when books and documents about the inci- received treatment within nine days. A record at the health bureau of dent were made available to the Chinese public. Xincai County also revealed that they found over 630,000 cases of illness “I was told not to make any public reports about the disaster, and to from August 17 to September 15. keep the death toll secret,” Zhang Guangyou, a Xinhua News Agency reporter who covered the disaster, revealed in Witnessing the 1975 Flood, Who to Blame? published in 2002. “My superiors did not tell me the reason until the early The Banqiao Dam was built in 1951, the year after Chairman Mao 1980s. According to him, the government of the time blocked the infor- called for dams to be built to tame the disaster-prone Huaihe River, which mation, for fear the news could trigger public panic, and annoy Chair- flows through Henan Province. man Mao and Premier Zhou Enlai, both of whom were bed-ridden with Zhumadian city had built more than 100 new dams between 1956 serious illnesses.” and 1957. However, since the government placed far more importance To this day, the Chinese government has never confirmed the death on capacity than discharging, many dams were built below the designed toll. The inscription on the memorial built on the dam site in 1987 errs standard of flood prevention, according to Chen Xing, the former general on the side of ambiguity: “The flood swallowed thousands of lives.” engineer of the Henan Provincial Water Resources Bureau. He revealed According to the initial statistics by the Henan provincial government in his memoir that the local government made repeated efforts to reduce in late August, 1975, 85,600 locals were killed in the disaster. Including the number of vents on the sluice gates in order to enlarge the reservoir’s non-locals, the death toll was “likely no more than 100,000.” capacity. The History of Chinese Disasters by Meng Zhaohua and Peng Chuan“Some attributed the dam burst to the delay in opening the sluice rong revealed that over 10 million people were struck by the flood, about gates to release the flood water. But I did three tests and found that even 100,000 of whom “were immediately washed away.” Cai Zeyi and Zhao if we had released the water in time, the flood-relief channels alone were Sixiong, two researchers from the Chinese Academy of Sciences, also gave not enough to discharge all the water,” Huang Mingshuan, then head of a similar figure. the hydrological station of the Banqiao Reservoir, told Southern Metropolis However, in the book Floods in Chinese History by former water re- Weekly in 2010. sources minister Qian Zhengying, published in 2006, the death toll was “The dams built in the 1950s usually adopted the low Soviet standards given as 26,000. Though the figure was later cited by government sources of flood prevention, and due to the lack of hydrogeological data, it was as the official death toll, it has been widely questioned by the public. hard for the designers to correctly foresee the flood risks in the region “I heard Suiping County [an area seriously affected by the flood] alone where a dam was to be built,” explained Xie Huiliang, the senior hydraulic lost 18,000 lives. How could the total death toll stop at 26,000?” Chen engineer. Bin questioned. “Worse still, the over-exploitation of land for the Great Leap Forward A new lead came in the 1980s, when eight members of the National campaign had seriously damaged the vegetation, further weakening the Committee of the CPPCC (the Chinese People’s Political Consultative bases of the dams,” he added. Conference), the country’s politcal advisory body, gave a death toll roughAccording to statistics from the Ministry of Water Resources in 2003, ly the same as that given by the Discovery Channel. In their jointly-writ- China had built over 84,000 dams between 1949 and 1999, among ten report, they indicated that the figure of 100,000 referred only to those which over 30,000 are unsafe. Today, perched over more than 400 cities who drowned, while 130,000 more died in the post-disaster epidemics and counties, they remain a threat to 150 million people.


OUTSIDEIN perspectives from within China

Lazy Nanjing

Songs of Indolence and of Experience The Southern Capital could teach its northern overlord a thing or two about taking it easy By Zach Valenta

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fter thirty years of breakneck growth, China in 2012 is home to a peculiar phenomenon. Formerly industrial regions like the northeast have been revitalized into hi-tech hubs, while former backwaters like Shenzhen have transmogrified into modern international cities. Even age-old hamlets in Yunnan, once discovered, become buzzing tourist Meccas, trampled beneath the marching feet of half a billion serenity-seeking Chinese tourists. In the midst of this sea change, however, certain locales seem to retain a time and place all their own beyond the push and pull of modern China. Nanjing, nestled in the arms of lower Yangtze and home to over 6 million, is just such a place, difficult as that may be to believe. The transportation, architectural and financial accoutrements befitting a big city are all here, but don’t be fooled. Life in Nanjing is a few steps slower, a waltz to Beijing’s foxtrot, and a few decibels quieter than your average metropolis. When you’re wandering in the cool shade of parasol trees on the banks of Yangtze, it all starts to make sense. Upon your arrival to Nanjing, the hardest choice is where to go first. The city sports a cultural legacy second only to the modern capi-

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tal, Beijing. Climb up the city wall and Zhonghua Gate? Ming Palace Ruins? Or maybe the Taiping Rebellion Museum? All worthy choices, but for my money the Drum Tower is an ideal first stop to relax and regroup after your bus or flight. Located in the heart of this ancient city’s oldest extant quarter, you have no excuse not to see Nanjing’s Gulou, or Drum Tower; it has its own subway stop, after all. Take Line 1 and exit at the busy intersection of Zhongshan and Beijing Streets. Occupying the center of a busy traffic circle, Gulou is a quiet oasis of green amidst the autos and office towers. The park’s bamboo shoots and willow trees make it hard to miss. Enter the gate along Beijing Street and into Gulou’s shaded paths. While some public parks in China can feel like massive spaces better experienced via helicopter than a Sunday stroll, Drum Tower is a city sanctuary meant for conversation, a bit of chess perhaps. Truly a park for the people. The district around Gulou provides a study in the contrasts of modern Chinese cities. Unlikely angles abound at the narrow intersection of winding hutongs, but walk further and you may emerge across from Zifeng Tower, the third highest in China and top ten worldwide. Despite commercial development, it remains one of the most NEWSCHINA I October 2012


Getting There: Befitting the economic and cultural might of the Yangtze delta region, and with Suzhou, Hangzhou, and Shanghai all in close proximity, plenty of domestic flights are routed through Nanjing. If you arrive by plane, take the affordable airplane shuttle, as the airport is situated well south of the city proper and a taxi will cost you dearly. Plus, the shuttle stops at the Zhonghua Gate, where you can sight-see before hopping onto Nanjing’s brand-new subway. Both train station and long-distance bus station lie north of the city center. If you’re heading east, take advantage of new high-speed rail to make Shanghai in an hour’s time. Getting Around: Getting around Nanjing is easy. The downtown is plenty walkable, and traipsing the city’s alleyways may make you averse to other, overcrowded forms of transport. Going by bicycle is an even more pleasant option. Nanjing is relatively flat unless you decide to do your best Tour de France impression up Purple Mountain. The bus system is simple enough to use, as is the subway. Although there are only two lines, most popular destinations have a station nearby and a third line is under construction in advance of the 2014 Youth Olympics.

walkable city centers in China. This leafy neighborhood is stitched together by parasol trees, 1930s architecture, and Nanjing University, known locally as Nanda. Walk the grounds for a potted architectural history of the modern city, with buildings dating from the institution’s founding in 1902 until the present. Hankou Street marks a line between the northern and southern halves of the university grounds and proves a haven for foodies. Chinese xiaochi can best be translated as snacks, but with only a few yuan in hand you can eat until stuffed. Sushi, fried steam buns, pastry, and barbecued seafood can all be found at street stalls along this stretch connecting Zhongshan Street and Shanghai Street. Hankou and the adjoining alleyways exude a distinctly international vibe. Nearby the northwest corner of the campus curious travelers will find multiple beer gardens and bars featuring an array of craft brews from as far as Belgium and as near as Beijing. Between Shanghai and Ninghai Street lays an arty cross section of the city’s wares, from Korean-inspired women’s fashion to high-end pottery. The energy here seems to be pushing the city outwards; walk west and gaze across the Yangtze to the satellite development zones that will someday hold Nanjing’s NEWSCHINA I October 2012

Photos by CFP

The peak of Purple Mountain, eastern Nanjing

Marble statue of Sun Yat-sen in the memorial park

future. This time head south on the subway for fuzi miao, or the Confucius Temple. Despite its ostensible old age, the temple area remains spry and is one of the few places in Nanjing to match the hurly burly of China’s first-tier cities. Tour groups mill about snapping photos and peddlers call their wares. The vibe here is roughly akin to Beijing’s Tiananmen Square. In drawing so many travelers, the festive atmosphere of the temple area exists outside the slower and more workaday

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travel

Be sure to pack an umbrella, though, as the shade of the lakeside won’t follow you out to the middle of the water. Abutting Xuanwu Park is the Purple Mountain. Not so much a single peak as a sprawling series of ridges, the park’s rolling features provide a number of recreation areas, smaller lakes and historical sites. Certainly the most famous is the memorial for Dr Sun Yat-sen. Widely revered both in China’s mainland and Taiwan, Sun is considered one of modern China’s crucial political leaders and revolutionaries, an icon for both sides of the Civil War, though the mainland kept his bones. Construction on the memorial began soon after Sun’s death in 1925 and was completed four years later. You might not believe this when taking in the sheer size and grandeur of the burial grounds. The memorial entrance is marked with by an elaborate paifang, or ornamental gate, followed by a long series of stairs. Especially during summer visits to the city, you’d do well to bring a few bottles of water, as the endless steps also double as a short hike. There are plenty of food and beverage options nearby the entrance gate, but nearly all are overpriced. Pack lunch ahead and make it an afternoon; if you linger long, you’ll be in time for a dusky view of the city from lookouts along the mountaintop, even better when the wooded hills turn red in autumn.  Photo by CFP

pleasures of Nanjing. Come at night to watch the boats come and go along the Qinhuai River that divides the temple area. Nanjing salted duck, Pteris shrimp and other local specialties can be found here as well. After a night of fine dining, strike out early for Xuanwu Park. Simply put, Xuanwu Park is huge. Of course, you can see that from a quick look on at a map. But in person, Xuanwu’s lake becomes an ocean, and the Purple Mountain a lofty summit. Located in east Nanjing, Xuanwu dominates the cityscape. Though not as wellknown as some of Nanjing’s other historical landmarks, this public space deserves wider public attention. Enter the park from the more crowded west gate downtown or through the old city wall to the east. Getting around the lake takes Nanjing University about an hour in either direction, enough time to get a taste of Nanjing’s breezy charms. Nanjingers nap in hammocks or tents, rollerblade, steal quiet time by the shore, play cards past dusk. The lake is ringed with red beamed pavilions, and as you round the shore you’ll find nearly all of them filled with some event or another: Chinese opera, the local orchestra rehearsing, maybe a birthday party or two. For those determined to venture onto the lake itself: as a rule of thumb, paddle boats are a bad idea and even worse with kids in tow, but the lake here is big enough that you just might get your money’s worth.

real chinese

tu

cáo

tu cao undermine Tu cao originates from the Japanese word tsukkomi, an expression meaning to “butt in” and jokingly undermine or contradict what someone has just said, a common device in traditional Japanese two-man stand-up comedy. In real life, this often happens between people who are familiar with each other, such as friends or family members. For example, when someone is bragging, someone else might blurt out the truth to make fun of the

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bragger. When read in Chinese, the Japanese characters for tsukkomi sound like tu (“to spit”) and cao (“container”), so the phrase literally means “to spit in someone’s bowl.” It has come to mean exposing someone’s shameful behavior, or complaining about others. Today, the phrase is often used in daily conversation, and has expanded to wider uses. For example, office workers might gather

in bars after work to tu cao their boss’s behavior over drinks. Here, tu cao simply means to vent one’s frustration about something or someone behind their back. In late August, residents in Shenzhen tu cao’d to the media that a 50 million yuan (US$7.9m) government-invested viaduct project had greatly inconvenienced them. Here, the phrase means to complain publicly to elicit media exposure. NEWSCHINA I October 2012


flavor of the month

Curl Up and Dai By Stephy Chung

NEWSCHINA I October 2012

catch with grill baskets, cooking the fish to tender perfection. Eating this creation was certainly an endeavor, with many prickly little bones to pick over. It was worth every effort. The snowy flesh was flaky and juicy from the stuffing and oils, and the salted skin was deliciously charred and well seasoned. With four sets of chopsticks hacking on all sides we devoured the fish in a matter of minutes. The next Dai favorite was the cold, DIY dish, known locally as sapie. A plate of dry, blanched rice noodles, topped with slices of stringy cooked beef and tripe, was served next to a brooding bowl of sauce made from chilies, cilantro, mint, and tart vinegar. This sauce separates fast, so before each dipping session, we were instructed to give it a hearty stir to thicken it up. The dish didn’t win me over. I found the sauce to be too bitter and the noodles tasteless. But, we did see townies voraciously slurping away at these noodles just about everywhere in Yunnan. Particularly on a hot, summer day, the spiciness generates an instant cooling effect. Laonai yangyu, or “Grandma’s potatoes,” was the designated comfort food of the feast. New potatoes simmer in chili oil, scallions, and Sichuan peppercorns, and then are handmashed with sour pickled vegetables. The weighty mass of the potatoes rivals any Thanksgiving variant, and the taste explosion of salty, sour, and hot flavors could knock the socks off any old granny. That said, Yunnanese elders here are quite tough. Nimble foragers, well into their seventies, made the next platter possible. The region’s midsummer rainy season gifts locals with an abun-

dance of wild, edible fungi, so many in fact, that a nearby mountain is now nicknamed junzi shan or “Mushroom Mountain.” A whimsical mix of morels, boletus, and willowy tea plant mushrooms was stir-fried with soy sauce, sweet Yunnan green pepper, and lots of garlic, and tasted much fresher, fleshier, and chewier, than the exported versions one might see in a hometown deli. We ordered bamboo rice to compliment our main courses. Soaked, short white rice is packed into a foot-long bamboo shoot. Its ends are covered with banana leaves, and then the whole contraption is roasted over an open fire. Once the bamboo cools, it is cracked open. The inner bamboo lining protects the rice from burning, and added a nice, faintly woody fragrance to each chewy grain. As we munched happily to the tempo of the light rain that began drumming on our thatched roof, we couldn’t help but admire the stunning scenery. The mountains, rivers, and forests that had shared with us their very best ingre- dients all went down a treat, awash with hearty gulps of the local pilsner. 

Photo Photoby byStephy CFP Chung

Driving through the lush landscape of southwestern Yunnan is an absolutely spectacular experience. In a decisive detour away from the now-overrun Tiger Leaping Gorge, a couple friends and I worked our way northwest to the Baoshan region, an area known for its 90-odd volcanoes. Volcanic land is especially fertile, and ribbons of sun-yellowed tobacco leaves and rice paddies wet with green shoots are a quick reminder that, just about anything can and will grow in such rich earth. Perhaps it’s the guarantee of a vast backyard farmer’s market which makes eating in Yunnan such an enjoyably organic experience, with its eateries a far cry indeed from the ubiquitous dirty hole-in-the-wall joints common to most Chinese cities. In the small town of Tengchong, locals directed our ravenous appetites to an outdoor eatery, Yan Ming Jia, featuring Dai-style cuisine. The Dai are one of China’s 56 official “minority nationalities,” famed for their colorful traditional dress and singsong dialect as well as a culture and religion heavily influenced by those of Burma and Thailand. These influences extend to the culinary, with Dai chefs employing a tremendous variety of herbs and vegetables, working rich, spicy and sour flavors into their fresh-tasting and substantial signature dishes. Eager to try, we were greeted at Yan Ming Jia by an array of pink and blue plastic tubs brimming with fresh vegetables, fish and meat, set down next to the restaurant’s open kitchen. This was our menu – an interactive point-andcook. Unsure of where to start, we ordered several recommended specialty dishes. Served first by a beaming, 12-year-old waitress, was a handsome grilled fish. Freshwater fish are caught in the surrounding rivers and lakes (crystal clear thanks to a paucity of humans and industry) and sold at bustling morning markets. The sides of the gutted fish are slashed before it is generously stuffed with minced garlic, chopped chives, and shredded red chilies, left to marinate until chosen by a ravenous diner. The chefs hunch over long, foot-tall charcoal grills, and are thoroughly versed in flipping the

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essay

Learning to Gawk For me, and for my former Bostonian classmates, the air travel involved in staging a reunion costs a month’s salary. So I don't fly home to see people, and they don’t fly to China to see me. The loneliness of the expatriate is akin to that of the long-distance runner: you can't help but adjust to the speed and variability if you're going to remain competitive. A month ago, my race was interrupted. A college friend called to say he was coming to visit. I was terrified. What could I possibly do with him? Beijing as a location is exhausting. Want a culinary adventure? Every one of China’s seemingly infinite range of cuisines is represented by a myriad restaurants of unpredictable quality. Culture vulture? There’s more than one full-sized city district devoted to the arts. Beijing is an imperial capital that was built to impress and awe from its foundations up over six centuries ago. The options are overwhelming, and I had no idea how to offer Will, my friend, the most comprehensive and enjoyable possible tour. What complicated matters was Will’s character. By his own admission, he only knew China through news broadcasts, kung fu movies and all you can eat buffets. He could barely use chopsticks. I was sure that like many other foreigners before him, he wanted to see my life as a box of picture postcards: rambling temples, mist-wreathed mountains and tranquil lakes, with a dash of Communist kitsch to complete this heady cocktail. The prospect of simply “seeing the sights” was offensive to me. Who wants to push through megaphone-wielding tour guides and their baseball-capped charges to squint through yet more crowds into a poorly-lit temple interior? Just summing my lifestyle up to this newbie was daunting enough. I wanted to take him to whiskey bars, to chow down on unidentifiable meat kebabs in the wee hours. I spent long, careful hours meticulously planning Will’s authentic China experience.

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Illustration by Xiang Zhaohui

By Sean Silbert

He was indifferent to my favorite rooftop bar, preferring to watch my neighbors play mahjongg in an alleyway, much to my chagrin.

My painstakingly-laid plans were for naught. As soon as he arrived, Will told me how his visit would work. He wasn't interested in jaunts and haunts. He just wanted to look at stuff. He was indifferent to my favorite rooftop bar, preferring to watch my neighbors play mahjongg in an alleyway, much to my chagrin. How dare he be enthralled by the quo-

tidian realities of my environment? What’s so special about incense smoke rising from the lap of a Buddhist icon? There are cocktails to be drunk over here! Just as New Yorkers fail to marvel at their own city’s jaw-dropping skyline, so too I had become blind to the wonders around me on a daily basis. With a jolt, I realized that years of amateur sinology had clouded my worldview to the point that to me Beijing had, warts and all, become my home. Will's walks and gawks pushed me far away from the expat experience I wanted to show him. After deplaning for my study abroad program several years ago, I joined the club of the jet-lagged night owl. I would wake up right before dawn and just wander aimlessly through the streets with no guide and only a limited understanding of the language. I didn't know where I was going; I didn't know where I was. I just wanted to rubberneck past the street signs I couldn't read and the salarymen I couldn't talk to. So I found myself doing what I would previously have detested: nothing at all. I meandered around the hutong alleyways and ate in local restaurants. Will came to China to see me, but he also came to see China; and it almost took the duration of his trip for me to recognize when I was the wallflower in our odd three-way. For Will, frustration in getting from place to place was part of the adventure. For me, it was exhausting. I was forced to live like I had just arrived: we ate at little ten yuan noodle stands before drinking cheap bottles of beer on the side of the road, after seeing the tourist attractions that I had willfully neglected for months. The two of us stared wistfully at ancient buildings I regularly pass on my way to work and debated their historical purposes. I saw Beijing through the untrained eye, and enjoyed the regression. I will never know how Will’s trip affected him, or how experiencing China changed his cosmopolitan outlook. I can only hope it had as much of an impact on him as it did on me. NEWSCHINA I October 2012


Cultural listings Cinema

Back into Darkness Born in the 1960s, Cai Shangjun has only ever directed two movies of his own. However, after his debut work The Red Awn won the FIPRESCI Award at the 2007 Pusan International Film Festival, his 2011 work People Mountain People Sea also earned him the Best Director prize at the 68th Venice International Film Festival. Telling the story of a man pursuing his younger brother’s murderer, People Mountain People Sea has been praised by critics for its unpolished reflection of the bottom rungs of society in today’s China. Yet, released in early August on the Chinese mainland, the movie underwent heavy “revision” at the hands of censors, in order to reduce its “social negativity.”

Exhibition

Book

Future Art

Revolution

The young artists of today will shape the art world of tomorrow. But how will it look? The CAFAM (Art Museum of China Central Academy of Fine Art) tries to find the answer for China. From August 8 to September 6, the museum held its first “CAFAM · Future” exhibition, which showcased nearly 200 works from 93 young artists from all over the country. The exhibition aimed to carry out broad field research of young artists and analyze the trends likely to take shape in Chinese modern art. A series of seminars and forums were also held to discuss related themes and issues, and encourage the creativity of young Chinese artists.

By Yang Kuisong

Music

Say “No” to Complimentary Tickets While music festivals in China have seen a burst of growth in recent years, the market is far from being well regulated. After a number of music festivals claiming their ticket sales had been seriously damaged by the obligation to give out free tickets, Big Love, a large-scale music festival held in June in Chengdu, was reported recently to have lost 50 million yuan (US$7.8m), largely due to free tickets given to various government departments and related organizations. InMusic Festival, an influential event in Hebei held every summer since 2009, announced in late July that it would boycott complimentary tickets. Even the local government in Hebei supported the decision, and issued a regulation to enforce the management of the ticket market. Many industry insiders worry that complimentary tickets could destroy China’s nascent live music market, and have given the boycotting their backing. NEWSCHINA I October 2012

Why did China turn to revolution in the first half of the 20th century? Why did the Kuomintang lose and the Communist Party win? A four-volume book titled Revolution by renowned historian Yang Kuisong was published in August to answer these crucial and complicated questions. Born in 1953, Yang Kuisong, director of the Research Group of Chinese Revolution History at the Chinese Academy of Social Sciences, is a veteran researcher of the history of the Chinese Communist Party. Based on rich archive material, the book depicted the lengthy history with analysis of the changing domestic and international background, political strategies of different powers, changes in “mediating forces” and the impact of historical incidents, drawing a broad yet clear map of Chinese revolution for readers.

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Commentary

Political Extremism

The Specter of Political

“Ultra-ism”

Political stagnation in tandem with social upheaval has incubated extremism at the heart of China’s public political discourse. Unless powerbrokers can respond with real reform, an all-or-nothing political schism could be inevitable By Xiao Gongqin

S

ince Deng Xiaoping unleashed economic reforms in the late 70s, and defended them from ultra-leftist opponents in a series of keynote speeches in 1992, public politics in China have transformed beyond recognition. In previous articles and books, I have argued that the top authorities, which I term “the liberal-minded technocratic new authoritarian regime,” had ample opportunity to further liberalize China’s political infrastructure and install a basic democratic system through the combination of economic advancement and the restructuring of civil society. This hasn’t happened. Instead political “ultra-ism,” the polemicization of political discourse both on the left and the right, has made a comeback after both extreme political camps were largely marginalized during the 1990s and early 2000s. This polarization has fed greedily on the increasingly visible corruption inherent in the system, and public anger has allowed political extremists to become increasingly assertive and gain greater prominence in society. China’s system is characterized by a strong

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State and a disempowered society. In the past three decades, China has experienced rapid economic growth, but little progress has been made in the field of self-government. In the absence of effective and universal political participation, which is indispensable to good governance, the negative impact of this structure has taken its toll. Coming hot on the heels of rapid economic growth are a host of profound social problems, including the widening wealth gap between the haves and have-nots, corruption, and the many forms of social injustice. Against this backdrop, the Chinese intelligentsia as well as the masses have become increasingly anxious about the future. “Whence China?” they ask. It is against this background that political ultraism has broken out of the confines of online forums and informal roundtables. Its proponents have gone out their way to proNEWSCHINA I October 2012


Illustration by Wu Shangwen

vide simplistic, attractive explanations of what has “gone wrong,” and prescribe equally simplistic, attractive panaceas. The radical leftists attribute all China’s social maladies to what they term “the resurrection of capitalism” in a nominally communist state. Their prescription is a second Cultural Revolution, a sweeping political movement that would uproot corruption and return the power to the masses, restoring social justice in the process. The radical rightists, conversely, argue that China’s social problems stem from the absence of Western-style democray. For them, the solution lies in the immediate introduction of direct elections and a multi-party system, even if such change would necessitate a “color revolution.” By occupying the moral high ground and pandering to a discontented public, both camps have gained sizable support which could be called the makings of a substantial popular power base. While political ultra-

NEWSCHINA I October 2012

ism flourishes in the wilderness, mainstream theorists have failed to get involved in the debate, let alone provide their own solutions to China’s manifold problems. We must look past plausibility and be made aware of the harm that political ultra-ism can do. The charm of this school of thought lies in the promise of a cure-all solution which can transform society from “bad” to “good” overnight. However, instead of evolving from empirical experience, these “solutions” are only ever rooted in a priori theories, formulas built on what proponents claim are “universal values” or “ultimate truth.” Both the ultra-left and ultra-right argue for democracy, but the very word “democracy” means different things in both camps. For the ultra-left, the point of departure is egalitarianism, and for the ultra-right, it is Western-style multi-party democracy. Political scientists would term these populist political thinkers “constructive rationalists.” Such theoreticians believe it is possible to design a set of social institutions which will instantly create a “good” society. They refuse to acknowledge factors such as path dependence, and the influence pre-existing customs, culture and prosperity can have on any new political institution. Any such institution, if it is detached from the reality of the society it claims to serve, may not only prove unfit for the purpose, it may also destabilize positive aspects of that society. Political ultra-ism is derived from a certain kind of “cultural romanticism.” In their frustration, sometimes desperation, people tend to believe in the existence of a society somewhere in the world or in their imagination that offer all the benefits they believe they lack, and often pin their hopes on recreating these imagined utopias. With social injustice increasingly visible, cultural romanticism has proven to be heady wine for the disenfranchised. But while romanticism is good for arousing people’s

passions, when it veers towards utopianism, as China’s history has proven, it becomes dangerous. We must not be misled by this kind of utopianism. Currently, at the core of public discontent is the unfair distribution of wealth between the rich and the poor, and between the State and society. But as China develops from one of the poorest countries in the world to become moderately prosperous, a certain level of income gap is inevitable. What China needs is not to overthrow the entire system, but to establish a mechanism to rein in this gap, allowing common people to share in the fruits of three decades of economic development. But the problem is that any serious reform was, is and will always be opposed by the powerful interest groups which benefit from the existing political system. This kind of exclusive benefit sharing explains why political ultra-ism is gaining in popularity, as it advocates the overthrow of the current system either through outright revolution or populist social activism. The mob dictatorship of the Cultural Revolution, still etched in many people’s memories, should have left Chinese people more aware than most of the potential outcome of such upheaval. For these historical reasons, the majority of China’s population remains politically moderate and socially pragmatic. They are the silent majority of the Chinese society. However, the radicals are generally providing the loudest voices. The authorities must seize the advantage and carry out serious political reforms before the moderates pass out of their reach. If the authorities fail to systematically address major social problems, most of all, the unbalanced distribution of wealth and power, which are stoking political ultra-ism, China could face yet another disastrous political schism, and chaos which would surely follow. (Xiao Gongqin is a historian with Shanghai Normal University, and author of China’s Big Transitions. This article is adapted from two earlier commentaries published in the July 16 and July 23 issues of the Chinese edition of NewsChina. Edited and translated by Yu Xiaodong.)

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October 2012