China’s First Nobel Laureate in Science
Posted: October 7, 2015 Filed under: Asia, China, Science & Technology | Tags: Beijing, Bilateralism, China, Chinese language, Communist Party of China, Demographics of China, Economy of the People's Republic of China, Liu Xiaobo, Nationality Law of the People's Republic of China, Traditional Chinese medicine, Xi Jinping Leave a commentMs. Tu won for the discovery of artemisinin, a drug that has significantly reduced mortality rates among malaria patients.
Tu Youyou, awarded the Nobel Prize in physiology or medicine on Monday, is the first citizen of the People’s Republic of China to win a Nobel for a scientific discipline and the first female Chinese citizen to win any Nobel. Imprisoned writer Liu Xiaobo was the first Chinese citizen to win a Nobel while in China in 2010 when he was awarded the peace prize. Chinese novelist Mo Yan won the literature prize in 2012.
Physicists Li Zhengdao and Yang Zhenning, who left China prior to the Communist Party takeover in 1949, shared the 1957 physics prize while working in the U.S. Both men later became U.S. citizens.

Tu Youyou: Conqueror of Malaria
Ms. Tu won for the discovery of artemisinin, a drug that has significantly reduced mortality rates among malaria patients, according to the prize announcement. The 84-year-old retired professor at the China Academy of Chinese Medical Sciences was awarded the prestigious Lasker Medical Research Award in 2011 for the same feat.
The discovery of the drug came in the early 1970s as the result of a program established by Mao Zedong to find a cure for malaria that would help the North Vietnamese in their fight with South Vietnam and the U.S., according to Chinese state media. Ms. Tu led a team that scoured traditional Chinese medicinal texts for remedies that might fight the parasite. They eventually identified artemisinin, a compound contained in a plant known as sweet wormwood that proved unusually effective in fighting the disease.
[Read the full story here, at China Real Time Report – WSJ]
“It is one of the few very truly innovative drugs to come out of China,” said Ray Yip, former China program director for both the U.S. Centers for Disease Control and Prevention, and the Gates Foundation. “The introduction of artemisinin was a major force in containing the scourge of malaria.” Read the rest of this entry »
[VIDEO] China’s Latest Fashion Trend? Beansprout Hairpins: ‘The Highly Sought Illusion of a Plant Protruding from the Head’
Posted: September 6, 2015 Filed under: Asia, China, Entertainment, Global, Mediasphere | Tags: Bean sprout, Brazil, Central bank, China, Economist, Economy of the People's Republic of China, fashion, Glamour, Menglin Huang, Stockmarkets, The Wall Street Journal, United States, video Leave a comment
Men, women, grandmothers and children in China are all donning the beansprout hairpin—a barrette that creates the highly sought illusion of a plant protruding from the head. Photo/Video: Menglin Huang/The Wall Street Journal
China Stock Markets: Sharpest Dive Since 2007
Posted: August 24, 2015 Filed under: Asia, China, Economics, Mediasphere | Tags: Beijing, Caixin Media, China, Economy of the People's Republic of China, Financial crisis of 2007–2008, Hong Kong, International finance, People's Bank of China, Purchasing Managers Index, Xi Jinping Leave a commentChina’s stock markets suffered their sharpest daily fall since the global financial crisis on Monday, with the government withholding support at a time when investors world-wide have been rattled by volatile selling in China and a slowdown in its economy. As WSJ’s Chao Deng and Anjani Trivedi report:
The Shanghai Composite Index’s loss of 8.5% by Monday’s close was its largest daily percentage decline since February 2007. Today’s performance reminded investors of an 8.5% drop on July 27, when worries mounted that authorities were pulling back on measures to prop up the market.
Monday’s performance erased Shanghai’s gains for the year, reverberated across Asia and weighed on global markets at an inopportune time for China. Next week, it will host world leaders for a memorial parade meant to show off its military power and increasing clout on the global stage. In addition, Chinese President Xi Jinping is slated to visit the U.S. next month. But a global selloff was already gathering pace by late afternoon in Asia, with European stocks and U.S. stock futures falling sharply. Read the rest of this entry »
China Just Did What?
Posted: July 9, 2015 Filed under: Asia, China, Economics | Tags: Central Commission for Discipline Inspection of the Communist Party of China, Communist Party of China, Economy of the People's Republic of China, Han Chinese, Industry of the People's Republic of China, John Kerry, President of the People's Republic of China, Qiemo County, Silk Road, Uyghur people, Xi Jinping, Xinjiang 2 CommentsChriss W. Street continues:
…China is about to show its third straight quarter of negative real (after inflation) GDP growth. The nation had been relying on a stock market boom to play a “decisive role” in funding the nation’s “Silk Road” reforms to transition to a consumer economy.
But as Breitbart News warned in “China’s Lehman Brothers Weekend Begins,” the “Red Dragon” has suffered a financial collapse equivalent in degree to the U.S. stock crash in 2008-9. Unlike the U.S., which used a formal government bailout to stabilize markets, the Communist Party instructed the nation’s banks to use their own balance sheets to guarantee the current $8 trillion stated value of all of China’s 2800 listed stocks.
As Stratfor’s John Minnich points out, “market capitalization of Chinese stock markets hovered around $1 trillion to $2 trillion” before the recent stock boom. At its peak on June 12, “China’s stock market capitalization, all the markets across the country, was something in the area of $10 trillion to $11 trillion.”
[Read the full text here, at Breitbart.com]
Minnich comments that people before the boom might gamble some of their personal savings into the stock market, but “it wasn’t critical to financing, corporate financing in the Chinese economy. Almost all corporate finances came through the state-owned banks.” Read the rest of this entry »
‘Not the Only Gorilla in the Jungle’: Japan Overtakes China as Largest U.S. Bondholder
Posted: April 16, 2015 Filed under: Asia, China, Economics, Global, Japan | Tags: Beijing, Economy of the People's Republic of China, Federal Reserve Bank of New York, Federal Reserve System, Financial Markets, Foreign exchange swap, Foreign-exchange reserves, Globalization, Monetary policy, People's Bank of China, United States Department of the Treasury, United States Treasury security Leave a comment
Japan’s purchases will help soothe lingering concerns that U.S. bond prices could decline as China slows its buying.
“China is currently the 800-pound gorilla in the U.S. Treasury market. However, it is not the only gorilla in the jungle.”
In reclaiming its status as the largest foreign creditor to America in U.S. official data, Japan is reasserting itself as Beijing holds its Treasury portfolio steady amid a weakening Chinese economy.
“U.S. debt bears higher yields than government bonds offered in other rich nations, thanks to the perception of stronger U.S. growth prospects and to central-bank bond purchases that have driven yields near zero across Europe and in Japan.”
Private investors and official institutions in Japan owned $1.2244 trillion of U.S. government securities at the end of February, compared with $1.2386 trillion at the end of January, according to the latest monthly data released by the Treasury on Wednesday.
China held $1.2237 trillion of Treasury debt at the end of February, compared with $1.2391 trillion a month earlier.
Over the past year, Japan has boosted its holdings by a net $13.6 billion, while China’s holdings dropped by $49.2 billion.
“The single largest holder of U.S. long-term debt is the Federal Reserve, with more than $2 trillion. The amount has surged from $755 billion at the end of 2007, fueled by Fed purchases of long-term securities in response to the financial crisis”.
The Treasury data, released with a two-month lag, don’t capture all of the Treasury-bond holdings China may have parked at middlemen in places such as the U.K. and Belgium. Many analysts and investors believe China has considerable holdings bought through such intermediaries. The Treasury notes on its website that “it is difficult to draw precise conclusions about changes in the foreign holdings of U.S. financial assets by individual countries” from the capital-flow data.
“The shift also reflects changes sweeping China. The world’s most-populous nation has in recent months largely held its Treasury portfolio in place, reflecting a slowdown in the growth of its $3.73 trillion foreign-exchange reserve, the world’s largest, and an effort to shift those reserves toward higher-yielding assets.”
The Japanese purchases have helped drive long-term U.S. bond yields near record lows despite an economic expansion that averaged 2.7% annually over 2013-14. Those low yields have, in turn, helped keep down interest rates for Americans on everything from home loans to credit cards. Read the rest of this entry »
The Great Wall of Manners: China to Start Keeping a List of Badly Behaved Tourists
Posted: April 8, 2015 Filed under: Asia, China | Tags: Abuse, Beijing, Boao Forum for Asia, Cathode ray tube, Chairman Joint Chiefs of Staff Committee, China, Communist Party of China, Economy of the People's Republic of China, President of the People's Republic of China, Xi Jinping 1 CommentRecent guidelines issued by state media have included gems such as admonitions against wearing clothing items that have images of pigs on them and making off with chunks of coral when diving off the coast of Fiji
Chinese tourists behaving badly abroad are in for a shock when they return to the motherland.
New measures announced this week by China’s national tourism authority mean that misdeeds by wayward Chinese vacationers will now be kept on record for a period of up to two years.
According to the announcement, “tourist uncivilized behavior records” will be compiled for those travelers that behave in an unseemly manner—including getting into fights, defacing public property or historical relics, disrespecting social norms of the host nation, gambling or whoring. Although the notification didn’t specify whether the guidelines were aimed at Chinese behaving badly at home or abroad, the most scandalous tourist behavior has tended to involve Chinese abroad.
“According to the announcement, ‘tourist uncivilized behavior records’ will be compiled for those travelers that behave in an unseemly manner—including getting into fights, defacing public property or historical relics, disrespecting social norms of the host nation, gambling or whoring.”
When necessary, such files – which will be maintained for a period of up to two years — will be shared with Chinese authorities such the police, immigration, banking and transportation authorities, the announcement said, without specifying what kinds of consequences might follow.
[Read the full text here, at WSJ]
If the flow of examples of uncouth behavior by some of China’s 100 million annual travelers in recent months is any guide, China Real Time expects the keepers of such records will be busy.
“Don’t throw water bottles everywhere, don’t destroy people’s coral reefs and eat fewer instant noodles and more local seafood.”
— President Xi
From tantrums involving the hurling of hot water at flight attendants to writing graffiti on ancient monuments in Egypt, Chinese tourists have been making headlines for all the wrong reasons. Chinese authorities in recent years have grown worried about how some of its roving nationals could be damaging the country’s image abroad.
“Why don’t we just learn from Singapore and just cane them?”
— Wisecrack from a Weibo user
On a visit to the Maldives last September, even President Xi Jinping spoke out, saying China needed to teach its citizens to be “a bit more civilized” when overseas. Read the rest of this entry »
Is China’s Communist Party Doomed?
Posted: March 14, 2015 Filed under: China, Global | Tags: 18th National Congress of the Communist Party of China, Beijing, Central Commission for Discipline Inspection of the Communist Party of China, Communist Party of China, David Shambaugh, Economy of the People's Republic of China, Hu Jintao, Jiang Zemin, Ling Jihua, National People's Congress, Xi Jinping Leave a commentIs China’s Ruling Party on the Brink of Collapse?
[With and HO-FUNG HUNG, ARTHUR R. KROEBER, HOWARD W. FRENCH, SUISHENG ZHAO]
“The endgame of Chinese communist rule has now begun,” influential China scholar David Shambaugh wrote in a March 7 article in the Wall Street Journal. “And it has progressed further than many think.”
Is the ruling China’s Communist Party (CCP) on the brink of collapse? We asked several China hands for their take:
Ho-fung Hung, Associate Professor of Sociology, Johns Hopkins University:
I agree with Shambaugh that there are serious cracks in the CCP regime, not only because of his arguments and evidence but also because of his deep knowledge about and long-time access to the party’s elite. Whether these cracks will lead to the end of CCP rule, nevertheless, is difficult to predict. The prediction about a CCP endgame this time might end up like the many unrealized predictions before. It may also be like the story of boy crying wolf: The wolf didn’t come the first two times, but it finally came when nobody believed it would come. The bottom line is, the CCP is facing very tough challenges. Whether and how it can weather them is uncertain.
“Xi’s purges surely make new enemies and make most of the Party elite feel deeply anxious about their fortunes.”
Xi is a leader who came to power with very few sources of legitimacy. Mao and Deng were among the founding fathers of the People’s Republic of China. Deng handpicked his successors Jiang Zemin and Hu Jintao — both of whom got the backing of party elders when they came to power. Xi, despite his princeling background, is the first leader chosen out of a delicate compromise among party factions.
“It won’t be so surprising if some of those anxious elite conspire to depose Xi.”
Amidst Xi’s rise to power, the mysterious Wang Lijun incident occurred, followed by the unusual downfalls of former top leaders Bo Xilai and Zhou Yongkang. What Wang actually told the American diplomats during his sleepover in the U.S. Consulate in Chengdu, and what sensitive information he eventually conveyed to Beijing is still unknown. But the rumor that he revealed a plot by other princelings to get rid of Xi through a coup does not sound too crazy. If this is true, then Xi’s frenetic purge of other factions in his anti-corruption campaign makes sense as a desperate move to whip the disrespectful elite to submission through creating a culture of terror within the Party.
Xi’s purges surely make new enemies and make most of the Party elite feel deeply anxious about their fortunes. It won’t be so surprising if some of those anxious elite conspire to depose Xi. Such internal coup against unpopular leaders is not alien to the CCP — it happened with the downfall of the Gang of Four in 1976, and former party chairman Hua Guofeng a few years later.
Second, the party’s internal rift is unfolding at the worst possible time, as far as the economy is concerned. Yes, a 7.4 percent annual growth rate is an enviable number to many other emerging economies. But with the soaring indebtedness of the Chinese economy and the ever aggravating unemployment problem, the Chinese economy needs higher-speed growth to stay above water.
[Read the full text here, at Foreign Policy]
The debt hangover of the 2008-09 stimulus is worrying. China’s debt to GDP ratio jumped from 147 percent in 2008 to 282 percent now, and is still growing. It is at a dangerously high level compared to other emerging economies. The economic slowdown will lead to profit decline for companies and revenue shortfall for local governments, increasing their difficulty in servicing and repaying debts. A vicious cycle of defaults and further growth deceleration could turn a slowdown into something uglier.
It is possible that the CCP elite, no matter how much they dislike Xi and his anti-corruption campaign, will still prefer not to rock the boat. They are aware that they are nobody without the protection of the party-state, and their privileges will be under far greater threat in the wake of a regime collapse. It is also possible that in the years of pacification and domestication following the 1989 Tiananmen Square crackdown, China’s civil society and dissidents have become so timid and cornered that they are incapable of taking advantage of any cracks in the regime.
Is Xi successfully increasing his grip of power through the anti-corruption campaign, or does his rule still suffer from inadequate legitimacy behind the mask of invincibility? Only time can tell. But besides the endgame of CCP rule, we should also ponder another possible scenario: the rise of a hysteric and suffocating dictatorial regime which maintains its draconian control over a society gradually losing its dynamism. Perhaps we can call this hypothetical regime North Korea lite.
Arthur Kroeber, Editor, China Economic Quarterly:
Neither China nor its Communist Party is cracking up. I have three reasons for this judgment. First, none of the factors Shambaugh cites strongly supports the crackup case. Second, the balance of evidence suggests that Xi’s government is not weak and desperate, but forceful and adaptable. Third, the forces that might push for systemic political change are far weaker than the party.
Shambaugh thinks the system is on its last legs because rich people are moving assets abroad, Xi is cracking down on the media and academia, officials look bored in meetings, corruption is rife, and the economy is at an impasse. This is not a persuasive case. True, many rich Chinese are moving money abroad, both to find safe havens and to diversify their portfolios as China’s growth slows. But in aggregate, capital outflows are modest, and plenty of rich Chinese are still investing in their own economy. Following an easing of rules, new private business registrations rose 45 percent in 2014 — scarcely a sign that the entrepreneurial class has given up hope.
The crackdown on free expression and civil society is deeply distressing, but not necessarily a sign of weakness. It could equally be seen as an assertion of confidence in the success of China’s authoritarian-capitalist model, and a rejection of the idea that China needs to make concessions to liberal-democratic ideas to keep on going. It is also related to the crackdown on corruption, which Shambaugh wrongly dismisses as a cynical power play. Corruption at the end of the era of Xi’s predecessor Hu Jintao had got out of control, and posed a real risk of bringing down the regime. A relentless drive to limit corruption was essential to stabilize the system, and this is precisely what Xi has delivered. It cannot work unless Xi can demonstrate complete control over all aspects of the political system, including ideology.
As for the economy and the reform program, it is first worth pointing out that despite its severe slowdown, China’s economy continues to grow faster than that of any other major country in the world. And claims that the reform program is sputtering simply do not square with the facts. 2014 saw the start of a crucial program to revamp the fiscal system, which led to the start of restructuring local government debt; first steps to liberalize the one-child policy and the hukou, or household registration system (discussed for years but never achieved by previous governments); important changes in energy pricing; and linkage of the Shanghai and Hong Kong stock markets. News reports suggest that we will soon see a program to reorganize big SOEs under Temasek-like holding companies that will focus on improving their flagging financial returns. These are all material achievements and compare favorably to, for instance, the utter failure of Japanese Prime Minister Shinzo Abe to progress on any of the reform agenda he outlined for his country two years ago. Read the rest of this entry »
REWIND: China Rejects Sign It May Soon Be Number One Economy
Posted: April 30, 2014 Filed under: China, Economics, Global | Tags: Asia, Beijing, China, Economy of the People's Republic of China, Germany, The Royal Bank of Scotland, United States, World Bank 4 CommentsChina has rejected a World Bank report that suggests it might pass the United States this year to become the biggest economy measured by its currency’s purchasing power.
China is on track to become the No. 1 economy by sheer size by the early 2020s and possibly sooner. But its leaders downplay such comparisons, possibly to avert pressure to take on financial obligations or make concessions on trade or climate change.
“…the NBS of China does not endorse these results as official statistics.”
— China’s National Bureau of Statistics
The estimate by the World Bank’s International Comparison Program says that based on 2011 prices, the purchasing power of China’s currency, the yuan, was much stronger than was reflected by exchange rates.
“It does bring home the sheer size of the Chinese economy, in the services and goods and that people in China are producing.”
— Mark Williams, chief Asia economist for Capital Economics
By that measure, China’s economy was 87 percent the size of the United States’ in 2011, or 15 percent bigger than the previous estimate, according to a calculation by RBS economist Louis Kuijs. Faster-growing China would pass the United States in purchasing power terms this year, though it still would be about 60 percent the size of the U.S. economy at market exchange rates. Read the rest of this entry »
Why China Wants to Dump the Dollar
Posted: October 17, 2013 Filed under: China, Economics | Tags: China, Chinese, Economy of the People's Republic of China, Japan, Renminbi, United State, United States Treasury security, Washington 2 CommentsChriss W. Street writes: China’s Dagong credit rating agency on October 17th downgraded its United States sovereign credit rating to A- and maintained its negative outlook on America’s solvency. Dagong warned that despite Washington’s last-minute resolution of the debt ceiling deadlock, “The fundamental situation that the debt growth rate significantly outpaces that of fiscal income and gross domestic product remains unchanged.”
China’s official state-run news agency, Xinhua, reiterated its statements that because of the continuing risk of a U.S. debt default, it is “a good time for the befuddled world to start considering building a de-Americanized world.” This language is code for China wanting to abandon the U.S. dollar as the world’s “reserve currency” and move international financial transactions to the renminbi, the currency of the People’s Republic of China.
Want to Understand How China is Doing? Don’t Look at GDP
Posted: October 7, 2013 Filed under: China, Economics, Global | Tags: China, Communist Party of China, Deng Xiaoping, Economy of the People's Republic of China, GDP, Great Depression, Gross domestic product, United States 2 CommentsWhy the classic benchmark statistic is unsuitable to describing the world’s second-largest economy.

Carlos Barria/Reuters
For over a quarter century, the one figure that dominated discussion of China’s economy was this: eight percent. Beginning in 1982, when leader Deng Xiaoping established the percentage as necessary to quadruple the size of the country’s GDP by 2000, China has seldom failed to achieve it—even in 2009, when the world was enduring the worst downturn since the Great Depression. The eight-percent figure became so entrenched that it acquired an almost Talmudic significance, causing speculation that if the economy didn’t grow by that amount, social instability would surely follow. (The fact that the number eight is considered lucky in Chinese culture only added to the mystique.)
These days are now over. China’s GDP has failed to reach the benchmark for six successive quarters, checking in at 7.5 percent for the second quarter of 2013. Though this growth is still robust by global standards, the sub-eight percent figure has raised concerns that a Chinese “slowdown” is now permanent—and will have serious consequences for the rest of the world. Read the rest of this entry »
China launches free trade zone in Shanghai
Posted: September 29, 2013 Filed under: Asia, China, Economics | Tags: China, Economy of the People's Republic of China, Free trade zone, Leadership of the People's Republic of China, Li Keqiang, Shanghai, State Council of the People's Republic of China, Xinhua News Agency Leave a comment
Workers finish off a large sign that reads “China (Shanghai) Pilot Free Trade Zone”, on September 23, 2013 (AFP)
Shanghai (AFP) – China launched a free trade zone in its commercial hub Shanghai on Sunday, state-media reported, with the project seen as a testing ground for much-needed reforms in the world’s second largest economy.
The zone, which covers 29 square kilometres (11 square miles), “started operating Sunday”, the official Xinhua news agency said, adding that it was “a test bed for the Chinese leadership’s drive of deepening market-oriented reforms and boosting economic vigour”.
Reforms in the zone will be closely-watched as a key test of China’s ability to make long-pledged structural changes as it attempts to shift its economic model in the face of slowing growth. Read the rest of this entry »