CNN cuts 30 jobs in Hong Kong

CNN will lay off 30 journalists at its Asia-Pacific headquarters in Hong Kong, the South China Morning Post reports on Saturday. The original number of jobs will be reduced from 50 to ten after the dismissal. The "redeployment" as it is called by the TV-station, will involve 10 producers and 20 freelancers.
The reduction is part of an unexpected restructering that also involved the Atlanta headquarters of CNN and its London operation. The Hong Kong office was established in 1995 at a time when most other networks had already reduced their international operations or were planning to do so.
Hong Kong has been severely hit, as the number of members of the Hong Kong Foreign Correspondents Club dropped from over 400 in 1997 to 170 at the beginning of last year. But Hong Kong and CNN are is not exception as the number of journalists deployed outside their own country has been falling already since the end of the Cold War at the beginning of the 1990s. While the numbers have gone up slightly in Beijing and Shanghai, the size of the foreign press corps has been reduced everywhere else in Asia.

Internet users go after Beijing officials

Another internet lynch party is on its way as internet users take on the local Beijing officials who are accused of having cause the deadly incident at the Latern Festival that caused the death of 37 people, mostly children and women, reports the South China Morning Post.
The incident was treated differently at different chatroom, the paper reports. The chat rooms of Tsinghua University and of the official newswire Xinhua allowed their users to discuss the issue freely, while the commercial sites, Sohu.com and Sina.com stopped their users from discussing the issue.
Under fire is the newly appointed mayor of Beijing Wang Qishan, who was called in after his predecessor had to resign after the SARS cover up.

Interesting to note is also that articles of the South China Morning Post are available for free again, although through an indirect source. The SCMP has asked money for access to its site over the past few years, making access very hard for incidental visitors of their site.

China panel at UMBS

Co-China blogger Micah from Ann Arbor urges me in one of the comments to attend tomorrow's China panel at the Business School of the University of Michigan. I had been trying to avoid the event, because at first it did not look so interesting. In China you know that most of the key speakers anyway do not show up at those conferences, so I did not look at it again.
Now suddenly they seem to have more interesting guests than originally announced, so I might go there anyway. The key speakers are still diplomats who - when they would give an exciting speech - will have to avoid that in order to keep their jobs. But a panel chaired by Ken Lieberthal seems a good reason to go their anyway. Anyway: it is in the same building where I mostly spend my time.

Preferential treatment discussed - yet again

It is that time of the year again, just shortly before the National People's Congress assembles for its annual meeting in March and the preferential tax treatment for foreign companies is yet again on the agenda, writes the Bloomberg (and many others).
Since I started to look at the Chinese political agenda unifying the tax regime as been on that agenda, so there is not real surprise here. This time even the proposal suggest is might only be due in 2006.
Foreign companies have been profiting greatly from this exception, but Chinese enterprises even more. After China started to open up for foreign investments, from the beginning of the 1980s, Chinese companies have been establishing 'headquarters' in Hong Kong with the main purpose of using the same preferential treatment.
Foreign companies never really had to lobby against changes in the tax regime in the past, since domestic opposition was fierce enough. Maybe I'm becoming an old cynic: I do not expect anything to happen soon.

Wiki!

Only yesterday I learned what Wiki is and today I'm using it. Now weblogs are taking off in China, so I have to increase my technological advantage on you guys, so I'm now participating in a wiki.
A Wiki is an online page where a group of people can work together on a document or a book. Watch my words: by 2005 after the blogs, wiki will be big in China. The subject I'm wiki'ing about might be utterly boring for most of you: it is about RSS-feeds, but who cares: it's my first wiki! How can I explain this to my mother?

Taiwanese business people join politics

A Taiwanese business lobby might organize a mass migration from China to Taiwan to let business people have a vot in the March 20 elections, writes AP. Traditionally Taiwanese business people have kept away from party-politics but that seems to change in the upcoming elections.
Hundreds of thousands of business people work and live in China. Under normal circumstances the estimated 400,000 voters would not return to Taiwan to vote, but the anti-China stance of current president Chen Shui-bian has driven them into the camp of his Nationalist opponent Lien Chan.

Kerry takes on gay marriage and outsourcing

In an effort to move mainstream, Democratic frontrunner John Kerry not only rejected gay marriages, he also took on outsourcing work to countries like China and India, writes the website of NDTV. The story is attributed to the Indian newswire PTI and has been picked up from the 'Contra Costa Times', a very long way for a story to travel.
"Democratic frontrunner in the presidential race, Senator John Kerry, has called companies, which outsource "Benedict Arnolds." The name refers to an American traitor, who defected from the ranks of American revolutionaries to join the British colonists," says the article.
Will try to find the original source.

Update: The story has been copied correctly as I should say, but seems to be an older quote within a larger article.

A WMD-fit

Most of the time I could restrain myself, but there is one general observation I have to get off my chest. The discussion on the reason for the US and Britain to start the war with Iraq, their illusive 'weapons of mass destruction" have caused already many comments. Now even the intelligence community in the US is denouncing the statements of its own administration regarding those WMD. How far does a country have to go that even its own spies lose confidence in their government?
Anyway: all this causes a crisis that touches anything the current US government is telling us. How could be believe that what they tell us is true? I know that almost half of the US citizens think it is not a big deal, but I do think it is.
I will try to ignore possible new lies of the US government, even when it concerns other issues. Trying to make a distinction between facts and fiction should be one of my tasks, isn't it?

A quote from today's mediachannel.org's newsletter:

Former Clinton aide Sidney Blumenthal is saying bollocks to the charge that the CIA did it - or failed to do it - however you want to put it and instead blames the Neo-Cons in the Pentagon. In a column today on Salon.com He writes, in part:

"The truth is that much of the intelligence community did not fail, but presented correct assessments and warnings that were overridden and suppressed. On virtually every single important claim the Bush administration made in its case for war, there was serious dissension. Discordant views -- not from individual analysts but from several intelligence agencies as a whole - were kept from the public as momentum was built for a congressional vote on the war resolution.

"Precisely because of qualms the administration encountered within, it created a rogue intelligence operation -- the Office of Special Plans, located within the bowels of the Pentagon. The OSP was under the control of neoconservatives; it roamed outside the regular interagency intelligence process, stamped its approval on stories retailed by Iraqi exiles that the other agencies dismissed as lacking credibility, and directly piped them into the president through the vice president's office. It was fail-safe in producing disinformation and feeding the impulses of a self-isolated president, but it was not what anyone involved in the craft of intelligence calls intelligence.

"There was no general intelligence failure; on the contrary, there was a successful effort by the Bush administration to intimidate, subordinate and punish intelligence to fit its political objectives.

end of quote

US: China does not fulfill WTO promises

The US administration has yet again accused China of not fulfilling the promises it made when it entered the World Trade Organization (WTO), Dow Jones and other media report.
"China seems to have lost momentum in implementing its commitment," James Jochum, an assistant secretary of commerce, told a committee set up by Congress to monitor China's WTO compliance. Other administration officials delivered similar testimony, describing China's progress as "incremental" and "short of the mark." They said the administration will consider all means to make sure China keeps its promises, writes Dow Jones.
The question is of course what these accussation mean when they come from a country that started a war against Iraq based false assumptions. The US administration seems to do reasonably well among the majority of its own citizens who just seem to believe anything that fits their own mindset, but convincing the rest of the world might not be that easy.

Shanghai plans free email boxes

For a country that was so much used to a planned economy, it is very hard to let things go. Shanghai announced this week a system where one million free e-mail boxes would be provided, writes the Shanghai Daily. That raises a multitude of ambivalent feelings.
As the user of about half a dozen different free email boxes I really do not want another one. Why would the government give us something we do not need? Then, Shanghai has about 20 million inhabitants, when they have only one million available, how would they pick the lucky people. While I do not want a free email box, I also hope they do not leave me out: that would be a nasty thing to do, isn't it?
The government wants to distribute her information in that way, because she is afraid that many of the paper leaflets to not get to its citizens. To be honest: I already get enough spam, I would rather not get the government-induced spam too.
Further we can pay our bills for utilities also online - for free. In most other countries banks offer this kind of services for free, in exchange for the honor of being able to deal with our money. In Shanghai the government offers the kind of services the banks fail to give and suggest we should be happy because it is for free.
Now, perhaps the government should encourage the banks to get their systems in place: this service sounds too outrageous for words.

HK investors want suspension China Life

Angry investors in Hong Kong want a suspension of the trade of the recently listed daughter of China Life. Its mother company in mainland China has been accused by the National Audit Office of fraud and "shareholder activist" David Webb has asked for a suspension of the trade until the company has released more information, writes the Hong Kong Stardard today.
Shares have been coming down, wrote the Financial Times yesterday.
The irregularities showed up during a regular audit of its 2002 activities, China Life said. The listed China Life company, that went for an IPO in Hong Kong and New York last month, only came into existence in 2003. The IPO was oversubscribed 150 times, but the recent disclosures might dampen the eagerness for future listings of Chinese companies. China Life is accuses of having sold policies though illegal channels and attracted customers by promising excessive returns.
The total scam is supposed to be as large as 2.5 billion Rmb (US$ 300 million).

The 'Suzhou' attitude of Singaporeans

The majestic failure of the Singaporean industrial park is a bit of an old story, but since it is now its 10-year anniversary, the Financial Times again tries to summerize its faults.
What was new for me is that the Singaporean failure has integrated that much into the management jargon, that Chinese now even refer to "a Suzhou attitude" when they deal with the Westernized managers from Singapore.

Citigroup takes the plunge

Citigroups has announced 'aggressive growth plans" for China, the Financial Times writes after the launch of the bank's start of its own credit card. Citigroups belongs with a small group of other international banks, HSBC and Standard Chartered, to the ones who intend to bank on China's future on a big scale, but is the first to really announce bigger plans.
Citigroup is the largest financial services company in the world.
Charles Prince, CEO and the group's chairman spoke in Shanghai en had been meeting top-level Chinese administrators in Beijing before that.
Prince indicated he would like to invest in the China Construction Bank, possible take a large chunk of their planned IPO, expected early next year. The plunge will be a jump into a still unknown future and Prince admitted that concrete plans had not been made, as the due diligence process had not yet started.
That will be an interesting process, so shortly after two other famous Chinese financial institutions, the insurer China Life and the other bank ICBC got into trouble last week as the country's auditor discovered large scale irregularities.
Other foreign financial institutions have taken a more careful approach and focus mostly on the customers they take from their home markets outside China.
China's banks are not only technical bankrupt, they have a hard time in delivering a decent service too. Only now transfers between banks are possible in China, reports Wang Jianshuo, while before that people had to walk with cash between outlets of banks, well at least three outlets of the Bank of China in downtown Shanghai.

Internet and censorship

Good backgrounder by the BBC on the way how censorship on the internet in China works: really a must to read (might be blocked in China, so a proxy is needed.)

2004: year of the price wars – the WTO column

(Later at Chinabiz)

2004: year of the price wars – the WTO column

Ann Arbor, MI – You might think that China is a bargain? Well, there is still room for improvement and we are going to see some of that during the upcoming year. Foreign companies that thought they had tapped into one of the most profitable markets of the world will have to readjust their estimations.

The first major change in the economies in China’s big cities people noticed halfway through the 1990s was that no longer supply but demand was directing daily life. Gone were the familiar queues and quota systems to organize scarce food and other resources. By freeing up the price controls system China’s consumer market came into existence, at least for a substantial number of consumer goods.
But important parts of the economy were excluded from this road to a market economy up to today, partly because demand was still higher than supply or because the government had good reasons to maintain a price level exceeding greatly the market value of the products and services. Cars in China have been too expensive compared to their production costs, telecommunication fees and airfares have been higher than really needed.
The Chinese consumers always knew they were paying too much for those cars and other products, but since there was a relative shortage with no alternatives in place, they accepted reluctantly the higher prices. In some cases the consumers benefited in the long run, as for example the telecommunication system in China’s larger cities is better, more transparent and certainly more affordable than those in Europe or the United States.

That artificial barrier to reach market prices has benefited some industries’ profitability in a major way: the airline industry bought time-out to reform before they will face global competition in a few years time. The telecommunication giants could show decent balance sheets to the investors that had to be lured into buying their shares at foreign stock exchanges. The poorly developed automotive industry could maintain a globally unmatched profitability, because they were allowed a margin of over 20 percent on top of the real production costs.
Foreign car companies, airliners and their suppliers had a golden decade as they used domestic protection in the slipstream of China’s policies. When I fly to Europe I regularly take a detour to visits friends in the US and still spend less money than on a direct flight from Shanghai to Amsterdam. While visa regulations would make such a detour hard to take for Chinese citizens, it shows how much the European airlines have been profiting.
Key markets will now lose this government-induced protection as competition increases under liberalization. The Ministry of the Information Industry has already announced that this year’s domestic phone fees will be up for review. Both increased capacity and competition will allow consumers to pay less, putting a dent into corporate profits. Car prices are going down ,dramatically, putting an end to the urban myth that Chinese cars are more expensive than Japanese or German cars. They only were because of the high margins of foreign car producers in China.
Reform is entering a new phase and the consumers seem the main beneficiaries; the golden times for some foreign investors might be reduced to … silver.

Fons Tuinstra

US visa checks halts return Chinese students

Hundreds, maybe even thousands of Chinese students cannot return on time to the US to resume their study after the Springfestival, the Shanghai Daily reveals today. The new US policy imposing new extensive background checks, meant to prevent terrorism, targets especially students working in areas like IT and telecommunication. The new background checks take weeks, sometimes months to carry out, the paper said. The Shanghai Daily was unable to reach US officials for comment.

Weekly chat on Wednesday (BT)

Every week I will (try to) host a chatroom so this whole venture can become a bit more interactive in the long run. I have planned to do this every Wednesday at 9:30 AM Beijing time. Please click here to get connected. It provides your access to the IRC-channel of the China Herald and is for free, although you might need to register if you have never used the system.
Please write to me if you encounter any problems.

Wednesday will be quiet I expect: it is the only time and China is still very much recovering from its holiday. Soon I will be moving this weblog to a domain that is not blocked by the internet censor, making it easier to access if from China. Only then I will start some more serious promotional activities.
Session will be at 8:30 PM EST/5:30 PM PST on Tuesday in the US if my timing is correct and on a rather inconvenient hour for Europe. Depending on the interest we might decide to shift timing.

Try to join me if you can.

China hits the European agenda

The move of president Chirac of France to put the ongoing embargo on selling weapon systems to China on the agenda has put China firmly on the political agenda again. The embargo is in place since 1989, when the Chinese army ended the protest at Tiananmen Square.
That was a long time ago. In December 2003 I met the spokesman on foreign policy of the social-democrat party in the Dutch parliament, Bert Koenders, who was kind enough to receive the first copy of my book on China.
He admitted that countries like Kongo and Ethiopia appear more often on the agenda of the Dutch parliament than China. It must have been four years earlier that the Dutch parliament discussed trade relations with China.
Obvious there is now a new opportunity to discuss the relationship with China. A majority in the parliament was against lifting the ban on weapon trade with China because of its human rights record, but the government decided to ignore that majority decision. Now media are calling me to get a decent opinion on the whole thing.
What I find strange about the whole discussion is that nobody bothers to define 'human rights' more precise: that would also create a nice benchmark for the moment when parliaments and governments might decide to lift that ban.
Guess that the death penalty is no argument, since the US has the same policy, although the number in executions in China might be higher. I'm following the media discussion here in the US right now and - say many Americans - they are controlled by big companies and the interest of the establishment. Still different from China, but not that much. And since the US government has started to arrest journalists without journalist visa at their borders, press freedom should perhaps not be a criterion anymore.
In short: I need benchmarks: what human rights should improve where. Now the discussion is really not a very substantial one.

American retailers flee China

The economy might be booming, 2004 might be the year of the Chinese consumer, but some of the American retail chains are seen packing their bags.
A&W, all American Restaurants has left its eight franchises behind, reports BizJournal, leaving behind over US$ 600,00 in debts.
The famous chain Blockbuster even did not make it into mainland China, counted their losses in Hong Kong and also decided to leave, a large number of media wrote in the past few days, after the Financial Times broke the story.
The year 2003 had been a watershed for many international businesses as even the traditionally gloomy American Chamber of Commerce in China had to admit most of its members did make a profit in China, and some were even wildly profitable.
But on the ground, in retailing, getting access has always been more troublesome.
Michael Wong from Blockbuster says that piracy issues, costs and different habits of video watching (like: only the illegal, affordable DVD's) made them decide to cease their operation.
China is not a place where general observations are very helpful: for every industry, for every region the situation might be different and other experiences might not be valid.

Propaganda boost for domestic stock exchanges

China's domestic stock exchanges have been in the doldrums for the best part of the past three years, so when the China Daily reported on Monday the stocks were going up, I decided to struggle through a lot of unevital bullshit propaganda.
Domestic stocks have been heading south since the central government started to suggest it would try to sell the so-called non-tradable stocks on the stock markets. Traditionally China's state-owned companies only floated about one third of their shares, so they could keep a majority and control into their own hands.
The initial idea of floating all was to fill the empty pension and social security funds, but since the value of the shares melted away under that threat. The plans was shelved, relaunced, shelved and for years its status has been unclear.
Until this weekend when - writes the China Daily - the State council came with reforms everybody had been waiting for.
You have to struggle to about halfway the piece before it starts to elaborate on what actually has been decided - indeed a very bad sign. The guidelines are said to be "comprehensive" and investors would expect futher market rallies. After reading this master piece I still did not know anything: will use have to see what other media are writing.

Iinteresting: even the online edition of the Shanghai Daily did not give attention to this master piece of propaganda. Xinhua has a piece, and the Hindustan Times took a piece from Reuters about the reform, but even nobody else taak the Reuters-dispatch as far as I could see.

Nick Kristof keeps on getting it wrong

The famous New York Times China expert Nick Kristof did get most of his career rather mixed reviews, also in the time he was covering China. US weblogs now have smelled blood as they go after mainstream media that keep on getting it wrong. Kristof is one of their major targets.
In December in wrote in one of my previous weblogs about Kristof. He got blasted for minimizing the Nanjing massacre (Dec. 31). Today his writing about sex slavery has triggered off another row among webbloggers. Mainstream media are being accused of rather following their own agenda in stead of telling their audiences what is really going on. Some of the weblogs are trying to correct that.
Unfortunately, most of the weblogs are hosted on blospot, blocked by the censor in China. In that way China stops information they would actually help her in showing that the way countries like China are being covered could use some improvement. But that argument not change the attitude: originally the internet filters also stopped information on Falung Gong given by the Chinese embassy in the US.

Chicken flu seems out of hand

Casualties among humans have not been reported from China, but tens of millions of chickens have been destroying in an effort to contain the chicken flu in China, write media this morning. Outbreaks of the deadly virus have been seen in eleven separate places in eight provinces, making it harder than ever to contain the disease.
SARS is also appearing again, although in terms of numbers (4) it seems more under control than the chicken flu.
Especially the geographical spread is worrying. Outbreaks have occurred in distant places like Zhejiang, Xinjiang and Hubei Provinces. The official newswire Xinhua reported that local officials said the spread of the disease was under control: not a reassuring sign. Those signals hide equally widespread panic.

Weekly chat on Wednesday (BT)

Every week I will (try to) host a chatroom so this whole venture can become a bit more interactive in the long run. I have planned to do this every Wednesday at 9:30 AM Beijing time. Please click here to get connected. It provides your access to the IRC-channel of the China Herald and is for free, although you might need to register if you have never used the system.
Please write to me if you encounter any problems.

Wednesday will be quiet I expect: it is the only time and China is still very much recovering from its holiday.
Session will be at 8:30 PM EST/5:30 PM PST on Tuesday in the US if my timing is correct and on a rather inconvenient hour for Europe. Depending on the interest we might decide to shift timing.

Try to join me if you can.