a The 16th Session of the 11th National People's Congress Standing Committee

The 16th session of the 11th National People's Congress (NPC) Standing Committee was held in Beijing from 23 to 28 August. The meeting passed amendments to the People's Mediation Law (full text of the revised law in XHNA, 28 Aug.) and to the Reserve Officers' Law. It voted through the Decision of the NPC Standing Committee on Approving the Bill to Amend Annex I of the Basic Law of the Hong Kong Special Administrative Region (HKSAR) (on the method for the selection of the Chief Executive), and approved the amendment bill. It voted on a report by the NPC Law Committee on the opinions about the deliberation of the Draft Amendment to Annex II of the Basic Law of the HKSAR: Method for the Formation of the Legislative Council of the Hong Kong Special Administrative Region and Its Voting Procedures. The meeting agreed to put the draft amendment on record, and it would be promulgated in the form of a public notice. It ratified the “International Convention for the Suppression of Acts of Nuclear Terrorism.” It approved the report of the Credential Committee on the credentials of a number of deputies to the NPC and made a number of appointments and dismissals. Wu Bangguo, Chairman of the NPC Standing Committee, presided over the closing session and made a formal speech summing up the work of the session and the achievements of the NPC in the first half of the year. He noted that attention would now be turning to the drafting of the 12th Five-Year Programme. They had already identified 14 special topics and set up special committees to examine them over the last four months. This had been very useful preparation for the Programme (XHNA, 28 Aug.).

During the session the Standing Committee also discussed draft laws on the application of laws to civil relationships involving foreign interests, draft amendments to the Criminal Law (including dropping the death penalty for some economic crimes, reducing the number of crimes attracting the death penalty from 68 to 55, and introducing tougher provisions on trafficking in human organs), the draft law on intangible cultural heritage, draft revisions of the soil and water conservation law, and amendments to the Law on Deputies to the NPC. The session also discussed reports on the implementation of the national economic and social development, the budget and other subjects (XHNA, 16 Aug.). The amendments to the Criminal Law also contained proposals to protect workers' rights with heavier penalties for those convicted of forcing others to labour through violence, coercion or the restriction of personal freedom, and provisions to penalize employers who deliberately defaulted on wage payments (XHNA, 23 Aug.).

b Party and Political Affairs

The Politburo met on 28 September to discuss its work over the past year to examine the proposal for formulating the 12th Five-Year Programme. It decided that the Fifth Plenum of the Central Committee would be held in Beijing from 15 to 18 October, and to submit the proposal on the Five-Year Programme to the Plenum after making a number of revisions based on discussion at the meeting (XHNA, 28 Sept.).

On 22 July, it was reported that the next Party Plenum, to be held in October, would discuss the formulation of the 12th Five-Year Programme. The announcement was made after a regular Politburo meeting. A statement said that: “[t]he coming five years will be a key period to build a moderately prosperous society in all respects and a period to tackle thorny problems in deepening reform and opening-up and accelerate the transformation of economic development pattern.” The meeting discussed the economy in some depth and noted that “[i]n formulating the 12th Five-Year Programme, there is a need to hold high the great banner of socialism with Chinese characteristics, uphold Deng Xiaoping Theory and the important thinking of the “three represents” as guidance, adhere to the scientific development concept, speed up the transformation of the economic development mode, continuously deepen reform and opening up, earnestly ensure and improve the people's livelihood, secure and expand the results of tackling the international financial crisis, promote long-term, stable and relatively fast economic development, and lay a basis of decisive significance for building a well-off society in an all-round way.” The meeting noted the success that China had achieved in coping with the international financial and economic crisis and held that for the rest of the year China should

The Politburo met again on 23 July for its 22nd collective study session, and General Secretary Hu Jintao expounded on the need to reform the cultural system in China in order to boost its “soft power.” He listed a number of key tasks: accelerating reform and innovation in the cultural system; building a public network providing cultural services; and building up cultural and creative industries for “the enhancement of the guidance of production of cultural products so as to meet the needs of the public.” He said that culture is an important source of national cohesion and creativity, an important factor in the competition for comprehensive national power, and an important supporting pillar for economic and social development (XHNA, 23 July).

China issued a new anti-corruption regulation on 11 July requiring all officials at or above county level to report changes in their marital status, the whereabouts of their spouses and children if they have moved abroad, personal incomes, housing and their family's investments. It also required them to report their ownership of passports or visas, and their children's marital status if they are married to foreigners or residents of Hong Kong, Macau or Taiwan (XHNA, 11 July).

There were a number of new senior appointments at provincial level, mainly reflecting the standard processes of retirement at the age of 65 for senior leaders and their replacement by younger officials. Zhang Yi was appointed Party Secretary of Ningxia Hui Autonomous Region on 24 July, replacing Chen Jianguo, who had passed the 65 age limit for senior officials. Zhang Yi was born in 1950 and had served in the Party Committees of Heilongjiang and Hebei, and had been a Deputy Secretary of the Central Discipline Inspection Commission before his transfer (XHNA, 24 July). Liu Weiping was appointed acting Governor of Gansu on 29 July following the resignation of the previous governor Xu Shousheng, who was transferred to Hunan. Liu had been a Deputy Secretary of the Provincial Party Committee previously. He was born in 1953 and joined the Party in 1974. He had earlier served as a Vice Governor and Deputy Secretary of Qinghai from 2001 to 2006 when he was transferred to Gansu (XHNA, 29 July). Li Zhanshu was appointed Party Secretary of Guizhou province on 21 August, replacing Shi Zongyuan. Li was born in 1950 and had been Governor of Heilongjiang before his transfer (XHNA, 21 Aug.). Following Li's transfer, Wang Xiankui was appointed acting Governor of Heilongjiang on 27 August. Wang was born in 1952 and joined the Party in 1974. He was a Deputy Party Secretary in Gansu from 2003 to 2006 and then a Deputy Party Secretary in Jiangxi (XHNA, 27 Aug.). Zhao Kezhi was appointed acting Governor of Guizhou on 30 August. He had previously served as a Deputy Party Secretary of Jiangsu (XHNA, 30 Aug.). An article in the Hong Kong Ta Kung Pao on 28 July noted that there had been a significant reshuffle of personnel in nine provinces recently, mainly affecting Party posts and in particular the Organization Departments. The provinces involved were Shandong, Guangdong, Guangxi, Hubei, Henan, Gansu, Zhejiang, Tibet and Ningxia. The article noted that a number of the newly appointed officials were born after 1960, showing a new cohort rising to power (Ta Kung Pao website, 28 July).

A number of central government appointments were announced on 18 August. These included the appointment of Gao Hucheng as International Trade Representative under the Ministry of Commerce, Wang Chao as Vice Minister of Commerce, and Chen Qiufa as Head of the China National Space Administration. Ma Xiuhong was removed as Vice Minister of Commerce (XHNA, 18 Aug.).

Several more senior figures were put on trial or arrested for corruption as China's drive against corrupt officials continued. The Supreme People's Procuratorate announced that it had recovered a total of 31.26 billion yuan from 2005 to May 2010, and had investigated 13,192 officials at country level or above. Wen Qiang, former Director of the Judicial Bureau of Chongqing Municipality, was executed on 7 July for corruption and other crimes. He had been one of the most senior targets of Bo Xilai's campaign against corruption in Chongqing (XHNA, 7 July). In Xi'an, former Assistant Minister of Public Security Zheng Shaodong was put on trial for accepting bribes and abusing his position (XHNA, 7 July). He was sentenced to death suspended for two years on 24 August (XHNA, 24 Aug.). Wang Huayuan, former Secretary of the Discipline Inspection Commissions of Zhejiang and Guangdong, was tried in Shandong in July for taking bribes and possessing unexplained assets (XHNA, 14 July). He was given a death sentence, suspended for two years on 9 September (XHNA, 9 Sept.). Chen Shaoji, formerly Head of Guangdong Provincial Public Security Bureau and Chairman of the Provincial People's Political Consultative Conference, was sentenced to death, suspended for two years, on 23 July in the Chongqing Intermediate Court. He was found guilty of accepting bribes worth 30 million yuan between 1992 and 2009 (XHNA, 23 July). The Mayor of Shenzhen, Xu Zongheng, was removed from his post and dismissed from the Party for taking bribes in “severe violation of discipline and the law” (XHNA, 18 Aug.).

Much interest was generated by Premier Wen Jiabao's remarks in Shenzhen on 21 August when he appeared to be advocating substantial political reform. He was visiting Shenzhen in connection with the 30th anniversary of the establishment of the Special Economic Zone. In a long speech that praised the innovatory work that had been done in Shenzhen and the success of the policy of reform and opening up, Wen said:

President Hu Jintao also visited Shenzhen and himself gave a speech on the example Shenzhen had set and its achievements (full text in XHNA, 7 Sept.). He took a much more cautious and mainstream line on political reform:

A mainland dissident, Yu Jie, published a book said to be highly critical of Premier Wen Jiabao in Hong Kong. Its title was China's Best Actor: Wen Jiabao. In a radio interview in Hong Kong he said: “I think China is at a critical turning point. To put it in the words of historian Tang Degang, China is like a boat coming out through the Three Gorges. It's at a dangerous historical junction. If Wen were a real great political leader, with the vision and guts of a great political leader, he would try at this critical historical moment to move political reform forward. But he isn't and he didn't.” Prior to publication he was reportedly detained by police for some hours and advised against proceeding with the book (RTHK Radio 3, 16 Aug.).

c Military Affairs

Hong Kong media reported that China had carried out military exercises in the East China Sea and the Yellow Sea in what was seen as a response to US–South Korea exercises. The PLA held live ammunition exercises in the East China Sea from 30 June to 5 July, within fishery zones forming part of China's EEZ. A Ministry of Defence official stated that the exercises had nothing at all to do with the forthcoming US–South Korea exercises in the Yellow Sea in which it was suggested that the carrier George Washington might take part. The Foreign Ministry had expressed “serious concern” over these reports (XHNA, 30 June). The Chinese Navy announced that it would be conducting live firing exercises in the Yellow Sea from 1 to 4 September, which it described as annual routine training (XHNA, 29 Aug.). The Yellow Sea exercise was held on 17 and 18 July and was a drill to ensure support for troop despatch and weapons transport at sea off Yantai in Shandong (Ta Kung Pao website, 20 July). An exercise involving the testing of new type of long distance multi-launch rocket was reported to have taken place in the Yellow Sea area on 27 July, and another one involving rocket tubes, satellite communication vehicles and other equipment was held near a port in Shandong (SCMP, 28 July). Large-scale air defence exercises were held in Shandong and Henan from 3 to 7 August under the Jinan Military Region, involving over 10,000 troops (ZXS, 3 Aug.). The Chinese Navy announced that it would be conducting live firing exercises in the Yellow Sea from 1 to 4 September, which it described as annual routine training (XHNA, 29 Aug.).

These exercises were held in the shadow of growing tensions between the United States and China related to their uneasiness over each other's military activities and posture. A feature of this was an increasing number of public remarks that were critical of the US, made by serving officers. Rear Admiral Yang Yi of the National Defence University was interviewed by ZXS on 2 August about relations with the US. He said that the development of relations depended in part on the need to deal with the maritime “security predicament.” The Chinese government had been very concerned about the reports that the USS George Washington would join exercises in the Yellow Sea, and the subsequent deployment in the Sea of Japan had not fully calmed things down. He said that the main responsibility for improving matters lay with the United States. It should abandon its traditional Cold War mentality and not see China's naval development as a challenge or a threat. China's military forces would develop and grow and must go out to the ocean. But all the time China would persist in peaceful development and would not be seeking hegemony by sea or elsewhere. It was necessary to build good strategic communication, to avoid increasing strategic mistrust, dispel misunderstandings and avoid strategic misjudgements (ZXS, 2 Aug.). In a similar vein Major General Luo Yuan was interviewed in ZXS on the subject of the US naval manoeuvres with Vietnam involving the USS George Washington. He claimed that the US was holding to its Cold War mentality and wanted to muddy the waters on the South China Sea issue and incite other countries to stand up to China. On the question of maritime rights he said:

He concluded that

The Hong Kong press reported a significant reshuffle involving over 20 senior military officers in July. There were a number of promotions and changes within the Central Guards Bureau; there were also considerable changes within the People's Armed Police at various levels. Other changes mainly affected officers working in the political departments at military region and military district level, including the promotion of Major General Du Hengyan from Deputy Political Commissar to Political Commissar of Jinan Military Region following the retirement of his predecessor. There were no obvious political patterns to the reshuffles (Ta Kung Pao website, 17 July). On 19 July the promotion of 11 officers to the rank of full General was revealed. These included the Commanders of Beijing, Lanzhou, Nanjing and Chengdu Military Regions (XHNA, 19 July). A further promotion of 21 officers to the rank of Lieutenant General was announced in late July. Analysis in the Hong Kong press noted that they had all been born after 1950, and included the youngest-ever officer at this rank (Zhang Yulin, President of the University of National Defence Science and Technology) and the first female officer of this rank (Xu Lili, Vice President of the Academy of Military Sciences). The analysis also noted that many of them had impressive professional qualifications (Ta Kung Pao website, 9 Aug.).

The Japanese news agency, Kyodo, quoted an internal report of the PLA that defence spending in 2010 was likely to reach 788.0 billion yuan (1.5 times higher than the figures given in the budget). Military spending was expected to double by 2020 and triple by 2030 (Kyodo News Agency, 8 July). The Ministry of Defence spokesman said on 30 July that China's defence spending had always been at a reasonable level and was only about 1.4 per cent of GDP, which was considerably lower than many other countries (XHNA, 30 July).

d Economic Affairs

It was reported that China had overtaken Japan to become the world's second largest economy in terms of overall GDP. Yi Gang, a Deputy Governor of the People's Bank of China, made the announcement in an interview on 30 July, but took pains to point out that it was something that was very much expected, and although it was true in gross terms, in per-capita terms China was still far behind many countries. “China is still a developing country, and we should be wise enough to know ourselves” (XHNA, 3 Aug.). The National Bureau of Statistics revised its figure for China's GDP in 2009 from 8.7 per cent to 9.1 per cent on 2 July, with the overall GDP reaching 34.0507 trillion yuan (US$5.296 trillion) (XHNA, 2 July).

The Chinese growth rate slowed somewhat in the second quarter, growing at 10.3 per cent compared to 11.9 per cent in the previous quarter. The National Bureau of Statistics spokeswoman said that this had been expected and would help speed up the transformation of the economic growth pattern and prevent overheating. Inflation was down in June with the Consumer Price Index rising at 2.9 per cent compared with 3.1 per cent the previous month. The Producer Price Index was similarly down rising 6.4 per cent in June compared to 7.1 per cent in May. Industrial value added output rose by 13.7 per cent, again down from the previous month. Retail sales also slowed, down to a growth of 18.3 per cent, from 18.7 per cent the previous month (XHNA, 15 July). The People's Bank of China announced that China's foreign exchange reserves had reached US$2.4543 trillion by the end of June 2010 (up 15.1 per cent from the previous year). The increase in reserves had slowed dramatically from the last quarter of 2009, partly because of the decline in the Euro against the US dollar. China's gold reserves were 33.89 million ounces (XHNA, 11 July). Premier Wen Jiabao, in his press conference with Angela Merkel, described the slowdown as being the result of active government regulation and control. He said that the government would be looking for the maintenance of stability in policy in the second half of the year, and added that “efforts will be made to balance continued steady and fast growth with the restructuring of the economy and the management of inflation expectations” (XHNA, 16 July). China's unemployment rate was 4.2 per cent at the end of June, unchanged over the previous three months. China claimed to have created 6.38 million new jobs in urban areas in the first six months against a target for the year of nine million, and an overall target of an unemployment rate below 4.6 per cent for the year (XHNA, 23 July). Premier Wen Jiabao repeated the essentials of China's policy prescription for its economic development in a speech to the Summer Davos forum in Tianjin (text in XHNA, 13 Sept.). He said that China would focus its efforts in the following areas:

The Central Committee and the State Council held a join meeting on developing the western regions of China on 5 and 6 July. It was attended by all the members of the Politburo Standing Committee, and both Hu Jintao and Wen Jiabao delivered speeches. The meeting marked the tenth anniversary of the launching of the project to open up the west and looked forward to the next ten years. President Hu described the next decade as “a crucial period in building a well-off society in an all-round way and are also a crucial period of inheriting the past and ushering in the future in pushing forward at a deeper level the general development of the western region.” Hu praised the considerable achievement made in the past ten years but noted that “the gap between the level of development of the western region and the central and eastern regions is still very great and the western region remains the difficult point and key point in building a well-off society in an all-round way in our country.” He said that over the next ten years:

The IEA issued a report in July that said that China had overtaken the US to become the greatest energy consumer in the world: consuming 2.252 billion tonnes of oil equivalent in 2009 (compared to the US at 2.17 billion tonnes). This provoked indignant responses from Chinese energy officials who disputed the assertion claiming that the figures were unreliable and that China's energy usage was really only 2.132 billion tonnes oil equivalent. The officials noted that the IEA lacked understanding of China's “relentless” efforts to cut energy use and emissions, and that China had outpaced the US in new energy expansion. (XHNA, 20 July). A further corrective was issued by the National Energy Administration and the National Bureau of Statistics which compared China's figures (slightly revised to 2.146 billion tonnes oil equivalent) to higher US figures from the US Energy Information Administration which put US consumption at 2.382 billion tonnes oil equivalent. They added that China's per capita energy consumption was just one fifth that of the US (XHNA, 11 Aug.). Wang Zhenhua, Vice Minister of the National Development and Reform Commission, said on 29 September that China would probably reach its goal of improving energy efficiency by 20 per cent from 2006 to 2010. Between 2006 and 2009 small thermal power plants with a capacity of 60 million kilowatts, and inefficient production capacity of 87.12 million tonnes of steel, 60.38 million tonnes of iron and 214 million tonnes of cement had been phased out (XHNA, 29 Sept.).

The Ministry of Agriculture announced on 16 July that China expected to produce 115 billion kilos of wheat this year, against an estimated domestic consumption of 105 billion kilos. The report noted that wheat prices had now stabilized as a result of the newly harvested wheat meeting demand (XHNA, 16 July). On 28 July the National Development and Reform Commission ordered local authorities to prevent hoarding and price speculation in grain markets. Some businesses had been buying large amounts of grain then bidding up grain prices following poor weather in some regions (XHNA, 28 July). The Ministry of Agriculture called for increased efforts to ensure a good autumn grain harvest, which makes up about 70 per cent of the annual harvest. The area planted to grain was estimated to have reached 76 million hectares (up 871,000 from the previous year). Summer grain harvest had fallen slightly from 2009 to 123.1 million tonnes (the first fall in seven years) (XHNA, 13 Aug.). The State Council weekly Executive Meeting of 11 August discussed measures for helping the late rice and autumn grain harvests (XHNA, 11 Aug.). The following week it discussed the expansion of vegetable production and supply in the light of an increasingly serious food supply situation in some major cities. Because of severe floods across China, vegetable prices rose 22.3 per cent in July from a year earlier, grain prices were up 11.8 per cent while poultry product prices rose 4.1 per cent (XHNA, 18 Aug.).

It was reported that housing prices in China's major cities rose by 10.3 per cent year on year in July, a decrease from 11.4 per cent the previous month. This was the third consecutive month that prices had risen at a slower pace, following a series of government measures to curb speculation and rein in prices (XHNA, 10 Aug.). Zhang Ping, Director of the National Economic Development and Reform Commission, said on 26 August that the regulation of the property market remained a daunting task despite some initial progress made in cooling prices. In the rest of the year the government would: “stabilize property market regulating policies, further implement the measures meant to curb excessive gains in housing prices, and resolutely restrain speculative property investment” (XHNA, 26 Aug.). On 29 September, the government announced that China would suspend bank loans for third-home purchases in the near future, and that pilot programmes for property taxes would be stepped up as part of measures to control house prices. First-time buyers would have to make a down payment of at least 30 per cent of the purchase price (XHNA, 29 Sept.). The Ministry of Finance said that the introduction of a property tax was necessary to ensure a healthy property market. Pilot programmes would be introduced in certain cities and then rolled out across the country (XHNA, 30 Sept.).

New figures for China's population were released on 3 July. The Director of the National Population and Family Planning Commission said that the population would reach 1.39 billion in 2015, with over 200 million aged over 60. The urban population would exceed the rural population and reach 700 million. In the same period, the ratio of the working age population would peak and then begin to decline slowly, and the dependency ratio would rise for the first time in 40 years (XHNA, 3 July). On 13 July, the National Committee on Ageing released figures to show that the aged population (those over 60) had increased to 167.14 million, 12.5 per cent of the total population (the increase of half a percentage point was the largest increase recorded). An official was quoted as saying this represented an enormous challenge to China: “The economy, the retirement system and services for the elderly are still too weak to handle the challenge” (XHNA, 13 July). China issued a White Paper on Human Resources on 10 September which described the country's human resources situation, related laws and regulations, and the protection of workers' rights and interests (full text in XHNA, 10 Sept.).

Heavy rains fell in early July causing considerable flood damage and persisted through into August. As of 14 July, 118 people had been reported killed and 47 missing in ten provinces in central and southern China. Floods were reported to have affected 32.3 million people and led to losses of 22.2 billion yuan with 101,000 houses and 252,800 hectares of crops destroyed. President Hu Jintao and Premier Wen Jiabao were reported to have taken a personal interest in the floods and ordered local governments to ensure the safety of the public and to minimize property losses (XHNA, 14 July). Water levels were predicted to rise in Yangtze River in mid-July as water flows in the upper reaches well exceeded those in the disastrous floods of 1998 (XHNA, 19 July). Heavy rains were reported in the Northeast as well and by 23 July the Ministry of Civil Affairs reported that floods this year in 28 different provinces had led to 742 deaths and 367 missing. Altogether 120 million people had been affected and 7.6 million hectares of crops had been destroyed, along with 670,000 houses, resulting in losses of 152.4 billion yuan (XHNA, 23 July). The Three Gorges Dam was reported to have kept the situation stable in the lower reaches of the river as the first high level passed (XHNA, 20 July). Premier Wen Jiabao toured Hubei province at a “crucial stage” of the preparations as water levels in the upper reaches of the Yangtze were the highest since 1987, and those in the middle and lower reaches were above warning levels for the first time since 2003. He attended a meeting in Wuhan to take reports on the work of controlling and combating floods along the Yangtze (XHNA, 24 July). The second peak flow reached through the Three Gorges on 28 July. Water levels in the reservoir rose to 158 metres (maximum capacity 175 metres) (XHNA, 28 July). Heavy rains continued especially in northeast China where Jilin province was badly affected. By 4 August, the number of deaths had risen to 1,072 with 619 missing, and altogether 140 million people had been affected with direct economic losses of around 210 billion yuan, 1.1 million homes destroyed and 9.72 million hectares of farmland damaged. Premier Wen went to the Northeast on 3 and 4 August to inspect flood control work, where 74 people had died in floods since 20 July (XHNA, 4 Aug.).

On 7 August torrential rains caused a huge mudslide in Zhouqu County, of Gannan Tibetan Prefecture in Gansu. Three villages were wiped out and about a third of the county affected. Premier Wen travelled to the scene to direct emergency operations and both he and President Hu were reported to have issued explicit instructions on dealing the disaster. By 10 August, it was reported that 702 people had been killed and over 1,000 were still missing. The Politburo met on 10 August, chaired by Hu Jintao, to make arrangements for rescue and disaster relief (XHNA, 10 Aug.). A massive emergency operation was mounted, and Guo Boxiong, Vice Chairman of the Military Commission, visited the area on 11 and 12 August to inspect the relief work being done by the armed forces. The rains continued and further mudslides occurred along the course of the Bailong River (XHNA, 12 Aug.). The scale of the disaster was so great that a national day of mourning was held on 15 August. President Hu went to the area affected to pay tribute, while other leaders participated in commemorative activities in Beijing (XHNA, 15 Aug.). Premier Wen paid a second visit to Zhouqu on the weekend of 21–22 August. The rescue operation had largely ceased and efforts were now turning to restoring people's normal lives. It was felt necessary for the local government to issue an order forbidding any further searching for missing bodies on health grounds. By 21 August the number of known dead was 1,435 with 330 still missing (XHNA, 22 Aug.).

In Sichuan heavy rains caused mudslides on 13 August which killed five people and left many trapped. Areas of Gansu and Shaanxi were also affected by heavy rains and landslides and at least 29 people were reported to have been killed (XHNA, 13 Aug.). One of the areas worst affected in Sichuan was Wenchuan, the site of the 2008 earthquake. More heavy rains, with widespread flooding and mudslides were reported from Gansu (17 Aug.), Liaoning near the North Korean border (21 Aug.) and elsewhere. Premier Wen visited areas in Sichuan which had been badly affected by mudslides (XHNA, 24 Aug.). On 31 August, the Ministry of Civil Affairs announced that 3,185 people had died in floods and landslides across the country in 2010, with 1,060 still missing. About 230 million people had been affected, and direct economic losses were reckoned at 350 billion yuan (XHNA, 31 Aug.). Typhoon Fanapi struck Guangdong province on 22 September causing floods and landslides which led to 75 deaths and 61 missing (XHNA, 26 Sept.).

Labour disputes at Japanese-owned factories continued to be reported by the official media. On 15 July, 100 workers at the Atsumitec Auto Part (Foshan) Co. Ltd. demanded a pay increase of 500 yuan a month in a peaceful gathering at the compound. Management responded by threatening to dismiss those involved (XHNA, 15 July). Later reports indicated that most of the workers at the plant had been on strike since 12 July. After a number of failed negotiations and attempts by management to bring in replacement workers, most workers agreed to a deal on 20 July involving a basic pay rise of 250 yuan and an increase in subsidies of a further 250 yuan a month (XHNA, 22 July). A further strike at another Japanese run plant in Guangdong, the Omron (Guangzhou) Electronics Company ended after one day when management agreed to a package worth 300 yuan in response to workers' demands for a rise of 500 yuan a month (XHNA, 22 July). Xinhua reported that workers had gone on strike at a South Korea run food plant in Beijing on 19 August, after the company had withheld an annual pay rise. The strike was resolved within three days, with the workers winning a pay rise, through the good offices of the area's administrative committee, the federation of trade unions and the company's trade union (XHNA, 20 Aug.).

The spokesman for the Ministry of Human Resources and Social Security said on 23 July that a timely and moderate rise in workers' salaries would spur domestic consumption, improve people's livelihoods and help bring about harmonious labour relations. But he warned against too rapid a rise in wages which could have an adverse impact on companies and undermine their long-term development (XHNA, 23 July). The Hong Kong press reported that the All-China Federation of Trade Unions (ACFTU) had announced that it planned to pilot a collective bargaining system in ten provinces, and to implement it for all enterprises with ACFTU-affiliated unions by 2012 (SCMP website, 28 July). An official of ACFTU said on 30 August that within two years all trade unions across the country would be carrying out collective bargaining on wages. By 2012, 90 per cent of enterprises should have trade unions representing 92 per cent of the workforce (XHNA, 30 Aug.). It was reported that Shenzhen was in the process of drafting new labour laws following the wave of strikes earlier in the year. The law included provision for the negotiation of pay rises on a collective basis at least once a year (XHNA, 1 Sept.).

e Social Affairs

A major national conference on education was held on 13 and 14 July, attended by all the top leadership. President Hu Jintao (full text in XHNA, 8 Sept.) addressed the conference and said that education should be a strategic priority. He promised that finance and resources would be made available for education and human resources development. It was billed as the first national education conference held in the 21st century. It reviewed China's achievements in education over the past 60 years and called for the full implementation of the Medium- and Long-Term National Education Reform and Development Plan 2010–2020. It outlines major goals and policies regarding education in the next decade and, in particular, a goal to increase the proportion of government spending on education to 4 per cent of GDP by 2012. Hu described education as the cornerstone for national revitalization and called for the full implementation of the Plan. Premier Wen Jiabao also addressed the conference (text in XHNA, 31 Aug.). The plan was published in full on 29 July (XHNA, 30 July).

An official of the Ministry of Industry and Information Technology confirmed on 11 July that the operating licence for Google's China website, had been “approved after rectification.” The operator, Beijing Guxiang Information Technology Company, had promised to abide by Chinese law and ensure that the company provides by no law breaking content “as stipulated in the 57th statement in China's regulations concerning telecommunications” (XHNA, 11 July). Liu Yunshan, Politburo member and Director of the Propaganda Department, attended a national meeting on removing pornography from the internet on 23 July (XHNA, 23 July). It was reported that China had shut down or blocked 19,000 websites since launching its campaign against internet pornography in December 2009. China had 420 million people with access to the internet by June 2010 (XHNA, 28 July).

Ma Li, Deputy Editor of People's Daily, wrote a piece on 30 July calling on China's major newspapers to make better use of internet technology. She noted that Chinese people were using the internet in ever-increasing numbers and the newspapers needed to respond to this, be more innovative in the ways they disseminated information, and also try to ensure social harmony. She said that the country should recognize the influence of the new media and pay high attention to internet “construction, operation and management.” She noted that the internet had brought new challenges of trust and credibility. The Party should use the new technology to serve China's socialist democracy and cement its ruling position (People's Daily in English, 4 Aug.). In a similar vein Wang Chen, a Deputy Head of the Propaganda Department wrote an article for People's Daily calling for a much strengthened internet “civilization” and the need to “create network harmony with a strong sense of responsibility and a high level of cultural consciousness, and make great efforts to promote great development and prosperity of our country's network culture” (People's Daily website, 21 Aug.).

Motorola filed a judicial complaint against Huawei for “stealing trade secrets” concerning its cellular network equipment. On 22 July, Huawei made a public statement rejecting the allegations as groundless and without merit (XHNA, 23 July). Chinese internet experts were interviewed to refute the proposition in the US Department of Defence report on China's military power that China was developing cyber intrusion and attack capabilities. The Chairwoman of the Internet Society of China, Hu Qiheng, was quoted as saying: “I have never heard of China's development of cyber intrusion and attack capabilities, let alone organized intrusions and attacks (by China) against foreign computer networks. It is simply preposterous to talk of China's connections to cyber intrusions against other countries.” Xinhua noted that there had been numerous allegations in the Western media in 2010 accusing China of cyber attacks, sourcing them in Hainan, Chengdu, Shaoxing, Jiaotong University and Lanxiang Senior Technical School in Jinan. Xinhua claimed that it was the US that was the main source of attacks, and recorded that more than one million IP addresses in China were controlled from overseas in 2009, and 42,000 websites were tampered with by hackers. The US accounted for 16.61 per cent and 22.34 per cent, respectively, of the IP addresses of overseas host computers that participated in the control of the IP addresses of host computers in China through Trojan horse and zombie programmes, ranking first in both categories (XHNA, 17 Aug.). China was said to have come under attack from a new super virus that had affected more than six million personal computers and 1,000 corporate computers by the end of September. The stuxnet cyberworm could break into computers and steal private information sending it back to a server in the US. It took advantage of a bug in Siemens auto-control systems used in manufacturing (XHNA, 1 October).

The Politburo held a study session on social issues on 29 September. President Hu Jintao was reported to have called on the government to take more pro-active measures to properly address social conflicts and to promote scientific development and social harmony. He said a large number of conflicts and contradictions would inevitably emerge in a society at the primary stages of socialism, due to the transformation of the economic system and the social structure, the realignment of interest distribution patterns, and the profound change of people's ideas and concepts. He called on the government to improve social administration and public services (XHNA, 29 Sept.).

A proposal to use standard Chinese more frequently in news programmes in Guangdong provoked strong local opposition to the extent that even the official news agency noted that it had “sparked a heated debate” and that many believed that it was the first step to the extinction of local culture (XHNA, 9 July). It was reported in the Hong Kong press that provincial leaders had held a meeting on the “cultural development” of Guangdong which would agree a new policy on boosting “Cantonese cultural heritage.” Party Secretary Wang Yang was quoted as having promised that “we won't let Cantonese culture die in our generation” (SCMP website, 17 July). Public protests were held in Guangzhou and Hong Kong on 1 August, following similar demonstrations the week in Guangzhou before. In Guangzhou the protests were deemed illegal and there were some scuffles between police and demonstrators (Hong Kong Standard website, 2 Aug.). The official press reported that three people had been detained for disrupting public order. A police spokesman was quoted as saying that most of the demonstrators had taken part because they believed rumours that Cantonese would be abolished, but a few criminal elements had deliberately sought to make trouble. He added: “[w]e hope citizens and netizens will not believe in such rumours and take part in such a rally, and help us to create a harmonious city.” The report noted that Guangzhou government had made it clear that they would not abolish the use of Cantonese (XHNA, 2 Aug.). The Hong Kong SCMP reported that the Guangdong Party Secretary Wang Yang had told a meeting on 4 August that there was no question of Cantonese being banned, and had claimed to be learning Cantonese himself (SCMP website, 6 Aug.).

The Hong Kong Information Centre for Human rights and Democracy reported that 2,000 workers had attacked the headquarters of Jilin provincial government while protesting about corruption at the factory where they worked. The protestors were staff of the Jilin Deda Company Ltd. (a Sino-Thai joint venture which took over a former state run plant). They accused the manager of corruption and embezzlement and claimed that their protests went unheard as he was too well connected to the system (Hong Kong Information Centre for Human Rights and Democracy, 13 July).

The Hong Kong press reported that thousands of Zhuang ethnic villagers had been involved in fighting with Han Chinese workers at an aluminium factory in Jingxi County, Guangxi. They claimed that the plant was dumping effluent which poisoned drinking water and damaged homes. Official media described the dispute as being over a road leading to the plant. A hundred people were said to have been injured in the fighting, and over 1,000 riot police were sent to deal with the disturbances (SCMP website, 15 July).

The General Administration of Press and Publication came out publicly in support of the rights of journalists to cover and comment on public affairs, following a high-profile case where police had sought to arrest a journalist in Zhejiang who had been accused of defamation by a public company. The Administration said in a statement: “[n]ews organizations have the right to know, interview, cover, criticize and monitor events regarding national and public interests. Journalistic activities by news organizations and their reporters are protected by law” (XHNA, 1 Aug.). The All-China Journalists Association made a similar statement on 7 August: “[i]t is imperative to safeguard journalists' legitimate rights to interview and stop any misconduct that interferes with journalists' legitimate interviews” (XHNA, 7 Aug.).

It was reported in Hong Kong that there had been serious clashes between the inhabitants of adjacent counties in Shaanxi and Inner Mongolia over a land dispute. Both sides had been backed by their local Public Security authorities and over 50 participants had been injured in clashes that involved up to 10,000 people. It is coal-producing region and both sides are seeking to stake out areas for mining which have traditionally been poorly demarcated, although the immediate cause was a dispute over grazing rights (Hong Kong Information Centre for Human Rights and Democracy, 3 Aug.).

f Human Rights

Liu Xianbin was reported to have been arrested on subversion charges on 7 July. He had originally been taken into custody on 28 June when police raided his home in Suining, Sichuan. He was released from prison in November 2008 after being sentenced to 13 years' imprisonment in 1999 for subversion. He had been a founding member of the China Democracy Party, and an activist in the 1989 demonstrations (SCMP, 7 July).

China published a White Paper on Progress in China's Human Rights in 2009 on 26 September (full text in XHNA, 26 Sept.). The Document had seven sections:

It contained a detailed explanation and justification of China's human rights record. It concluded that the overall cause of human rights had been promoted in an all-round way. In 2009 the Government had promulgated and implemented its first national action plan on human rights, and it had been very effective.

g Tibet and Xinjiang

The reincarnation of the fifth Living Buddha Dezhub, who had died in 2000, was chosen in Lhasa on 4 July in accordance with the lot-drawing process favoured by China. The Panchen Lama oversaw the process and drew the lot from the golden urn. The chosen boy was Losang Doje from Shannan Prefecture. He would be formally appointed following the approval of the People's Government of Tibet (XHNA, 5 July).

Jia Qinglin, of the Standing Committee of the Politburo, convened a meeting in Beijing on 7 July to discuss ways to implement the spirit of the fifth central forum on work in Tibet and to find ways to improve the pairing system between parts of Tibet and regions of China. He noted that “[t]horoughly waging a struggle against the Dalai clique is a basic guarantee for realizing leapfrog development and lasting peace and stability in Tibet and Tibetan areas in four provinces. We must uphold the central authorities' basic guiding principle of waging a struggle against the Dalai clique, properly deal with various infiltration and sabotage activities by hostile forces, perfect various measures for safeguarding stability, properly carry out work relating to Tibetan Buddhism, and strengthen Tibet-related diplomatic and external propaganda work in a targeted manner in order to foster a good environment at home and abroad for development in Tibet and Tibetan areas in four provinces” (XHNA, 7 July). He Guoqiang, Secretary of the Central Discipline Inspection Commission, toured Tibet from 13 to 16 August, and said that the government and people of Tibet should make continuous efforts to achieve “leapfrog development and lasting stability” (XHNA, 16 Aug.). Du Qinglin, Head of the United Front Work Department, addressed a conference on the “democratic management” of monasteries held in Shigaze on 14 and 15 August. He said that competent monks and nuns who were politically reliable, extraordinarily learned and widely respected should be selected to be on the management committees through a process of “democratic consultation.” He added that the lawful rights of monasteries, orderly religious practices of monks and nuns, and the normal religious practice of believers should be ensured (XHNA, 15 Aug.). Du said that monastery rules must be in line with laws and government regulations, and monasteries should step up patriotic education and improve the monks' awareness of national unity and social stability (SCMP, 18 Aug.). The Ministry of Public Security held a meeting on security work in Tibet and the Tibetan regions of neighbouring provinces in Lhasa on 18 and 19 August. The meeting discussed public security work in the region from 2001 together with the current anti-secession struggle and work to maintain stability in Tibetan areas (XHNA, 29 Aug.).

The Indian Press reported that the Indian Foreign Secretary, Nirupama Rao, had travelled to Dharamsala for a meeting with the Dalai Lama on 10 July, but no details of the meeting were released. The report noted that the meeting came shortly after the visit of the Indian Prime Minister's special envoy to China (Press Trust of India, 10 July). China responded on 13 July, urging India to honour its commitments and handle issues relating to exile Tibetan affairs cautiously. The Foreign Ministry spokesman said that China had its stance clear to India and added that “[t]he Indian government has repeatedly acknowledged to China that it recognizes Tibet as part of China's territory and does not allow exiled Tibetans to conduct anti-China activities on Indian territory” (XHNA, 13 July). Following Chinese protests at a meeting between the Indian Prime Minister and the Dalai Lama, the Indian Minister of External Affairs said that India considered the Dalai Lama an honoured guest but did not encourage him to engage in political activities. India considered Tibet to be part of the People's Republic of China (Press Trust of India, 21 Aug.). In a press conference during the visit of the British Foreign Secretary, William Hague, Yang Jiechi, the Minister of Foreign Affairs, said that other countries should not provide a platform for Tibetan separatists and that Tibet-related issues were an internal affair of China's and that Tibet was a core national interest. He stated that it was widely recognized by the international community that Tibet had been an inalienable part of China since ancient times (XHNA, 14 July).

The journalist Gheyret Niyaz was sentenced to 15 years in prison by a court in Urumqi for “endangering state security.” He had been detained in October 2009 following his criticism of China's policy towards the ethnic minorities and sending news to foreign journalists of the situation in Xinjiang (Reporters sans Frontières website, 24 July). Radio Free Asia also reported that three Uighur webmasters had been sentenced to jail in Urumqi for publishing politically sensitive material on their sites. Dilshat Perhat, webmaster of Diyarim, Nureli, webmaster of Salkin, and Nijat Azat, webmaster of Shabnam were sentenced to five, three and ten years respectively for endangering state security (Radio Free Asia, 28 July).

There was an explosion on 19 August in Aksu when three people drove an electric tricycle into a crowd and detonated explosives. Six people were killed and 15 injured. There were alleged to have been men involved in the incident, led by Ehmet Kurba. Two of them died in the explosion and the other four were subsequently detained (XHNA, 25 Aug.). Police in Xinjiang issued a notice on 27 August offering rewards of between 10,000 and 100,000 yuan for any information leading to the discovery of illegal weapons or explosives (XHNA, 27 Aug.).

h Hong Kong Special Administrative Region

The annual pro-democracy march was held in Hong Kong on 1 July. Initial reports noted the anger shown against the Democratic Party for supporting the government's reform package, despite the official theme of the march being labour rights. The organizers estimated that around 52,000 people took part (down from 76,000 last year) and police estimates were substantially lower (RTHK, 1 July). The Chinese press reported that 3,000 people, including leading figures from the SAR Government, had attended the flag-raising ceremony to mark the 13th anniversary of the establishment of the SAR and the return of Hong Kong to China. The Chief Executive, Donald Tsang, addressed the reception for the anniversary and said that the city had seen favourable developments in the economy and in democracy over the past year. The economy had picked up following the global financial tsunami and Hong Kong had seized every opportunity arising from its growing economic integration with the mainland, including expanding Renminbi business in Hong Kong. The passage of the reform bill had laid down a milestone in Hong Kong's democratic development and was “the best gift as we celebrate our reunification” (XHNA, 1 July).

The Hong Kong press reported that Wang Guangya, formerly a Vice Minister of Foreign Affairs, would take over from Liao Hui as Head of the State Council Hong Kong and Macau Affairs Office. Liao would remain as Deputy Head of the Central Leading Group on Hong Kong. Wang was born in 1950. He has many years of experience in the Ministry, particularly in dealing with multilateral issues and the United Nations (Hong Kong Standard, 28 Sept.).

a Multilateral Conferences

b Countries, Regions and Territories

c Trade and Currency Disputes

Chinese official sources described the decisions by the EU and the US to impose import barriers on three kinds of Chinese product as a lame excuse to put up protectionist barriers. On 28 June the US Department of commerce had set final antidumping duties on woven electric blankets from China; on 30 June the US International Trade Commission decided to impose anti-dumping tariffs on a Chinese chemical product, and the EU announced an anti-dumping investigation into wireless modems from China (XHNA, 1 July).

On 20 July, the Ministry of Commerce accused the US of protectionism in the light of a proposed investigation into the plans of a Chinese steel maker to invest in the US. The Anshan Iron and Steel Group was looking into establishing a joint rebar venture with a US partner in Mississippi, but 50 Congressmen had asked the US government to investigate the deal (XHNA, 20 July). On 20 August the Anshan Iron and Steel Group said that they were determined to proceed with plans to invest in the United States, following reports that they might give up the plan (XHNA, 20 Aug.). A Xinhua commentary on 27 August complained of numerous instances when the US had blocked investment from China on national security grounds, which the commentary described as a protectionist move that could only harm its own interests. The commentary listed the request by Congressmen that the administration scrutinise a deal between Huawei and Sprint Netzel, and the problems of Anshan Iron and Steel. The Ministry of Commerce spokesman was quoted as saying “[i]t is inappropriate for some US lawmakers to label regular business behaviour as a move that threatens national security” (XHNA, 27 Aug.). The Anshan deal was signed in Beijing on 15 September (XHNA, 15 Sept.).

China announced on 30 August that it would investigate whether EU members subsidized exports of potato starch to China. This was the first anti-subsidy investigation into imports from the European Union (XHNA, 30 Aug.). The Chinese Ministry of Commerce spokesman said that China was seriously concerned by EU anti-dumping investigations into Chinese-made Wireless Wide Area Networking modems (a trade worth US$4.1 billion). He said that the move would disrupt normal trade and hurt the interests of EU consumers. He hoped that the EU would keep its promised opposition to trade protectionism, and warned that China would take corresponding measures, within WTO rules, in due course (XHNA, 16 Sept.).

The Ministry of Commerce announced on 26 September that China would levy anti-dumping duties of between 50.3 per cent and 105.4 per cent on imports of US chicken products. In 2008, imports of US chicken products reached 584,300 tonnes, an increase of over 12 per cent from the previous year (XHNA, 26 Sept.).

Despite China's decision to allow the yuan to become more flexible in June, and some limited upward movement in respect of the dollar, pressure mounted on China to revalue the yuan more comprehensively. Most of this came from the United States, but it was echoed elsewhere. China continued to resist the pressure. A typical commentary concluded: “[p]ast experience shows that global peace and prosperity is impossible without China's participation and as the world's biggest developing country, China cannot develop itself without the help of other countries. Therefore, the US should rein in those Congressmen yapping for Beijing to revalue the yuan and join hands with China to build a positive, co-operative and comprehensive relationship for the 21st century (XHNA, 15 Sept.). As the voices in the United States grew louder, China put its own position more forcefully. At the Foreign Ministry press briefing on 21 September, the spokeswoman put forward China's standard line on the trade deficit with the US and the currency question. She said:

Premier Wen Jiabao took a very similar line in a speech in New York, saying that there was no basis for a drastic appreciation of the yuan. The whole question was an economic one and should not be politicized. China had been highly responsible on the exchange rate and the issue should be considered from a historical perspective (XHNA, 23 Sept.). The Ministry of Commerce complained that the proposed anti-subsidy investigation by the US into Chinese imports on the grounds of exchange rate manipulation was a violation of WTO rules. The Currency Reform for Fair Trade Bill passed by the Congress on 29 September allowed the US to seek trade sanctions against partners for allegedly manipulating their currency. The spokesman said that China was willing to take measures, with the US, to balance bilateral trade, and hoped that all parties in the US would evaluate the facts in an objective way and make the right decisions (XHNA, 30 Sept.).

d Defence Diplomacy and Exercises

The Third Joint Military Exercise, Friendship 2010, between China and Pakistan was held in the Ningxia Hui Autonomous Region in early July for 11 days. The Pakistani Chief of Staff visited to observe the exercises which focussed on anti-terrorist capabilities (Daily Times website, Pakistan, 4 July; XHNA, 5 July).

A Chinese naval flotilla of destroyer and a frigate was observed to have passed through international waters between the Japanese islands of Okinawa and Miyako heading towards the Pacific Ocean on 4 July. This followed an earlier movement in a similar region by two submarines and eight other vessels in March (Kyodo News Agency in English, 4 July)

It was reported that China has sent 15,603 soldiers to participate in 18 United Nations peace-keeping missions since 1990, nine of whom died while on their mission (XHNA, 6 July).

Two Chinese warships, a frigate and a destroyer, visited Egypt from 26 to 30 July. They had been part of the fifth naval flotilla despatched by China to the Gulf on anti-piracy duties (XHNA, 26 July). The ships then visited Italy, arriving in Taranto on 2 August, where they planned to engage in joint exercises with the Italian navy before leaving for Greece on 6 August (XHNA, 2 Aug.). The flotilla arrived in Piraeus on 9 August for a visit lasting to 13 August (XHNA, 9 Aug.). It made its final call in Rangoon, Burma on 29 August. This was the first ship visit to a Burmese port by the Chinese navy (XHNA, 29 Aug.)

A Chinese navy hospital ship deployed to the Gulf of Aden on 30 August. It planned to call at Djibouti, Kenya, Tanzania, the Seychelles and Bangladesh en route, and to offer medical treatment to local people (XHNA, 30 Aug.)

A Chinese frigate and a training vessel made the Chinese navy's first ever visit to Vanuatu on 27 to 30 August. The flotilla had previously visited Papua New Guinea and was going on to Tonga, New Zealand and Australia (XHNA, 27 Aug.).

China announced that it would send more than 1,000 army and air force personnel to Kazakhstan to take part in anti-terrorism exercises, “Peace Mission 2010,” under the auspices of the Shanghai Cooperation Organization. This would be China's largest deployment in 2010 (XHNA, 30 July). The Chinese contingent was commanded by Ma Xiaotian, Deputy Chief of the General Staff, in the exercises which lasted from 9 to 25 September (XHNA, 6 Sept.). Chen Bingde, Chief of the General Staff, attended the opening ceremony on 9 September. Liang Guanglie, Minister of Defence, also went to observe the exercises on 23 September (XHNA, 23 Sept.).

The Turkish press reported that China and Turkey had held a join military exercise in Konya in September, and Turkey tested Russian-built MiG-29 and Su-27 warplanes belonging to China (Milliyet website, 1 Oct.).

The Australian frigate, Warramunga, visited Qingdao and Zhanjiang from 18 to 30 September and the ship took part in joint rescue drills with the Chinese navy. Chinese marines and Australian naval Special Forces also conducted a joint exercise (XHNA, 16 Sept.).