Archive for the ‘China’ Category

Regional Analysis Brief: South China Sea

September 26, 2012 Comments off

Regional Analysis Brief: South China Sea
Source: Energy Information Administration

The East China Sea is a semi-closed sea bordered by the Yellow Sea to the north, the South China Sea and Taiwan to the South, Japan’s Ryukyu and Kyushu islands to the East and the Chinese mainland to the West. Evidence pointing to potentially abundant oil and natural gas deposits has made the sea a source of contention between Japan and China, the two largest energy consumers in Asia.

The sea has a total area of approximately 482,000 square miles, consisting mostly of the continental shelf and the Xihu/Okinawa (Chinese name/Japanese name) trough, a back-arc basin formed about 300 miles southeast of Shanghai between the two countries. The disputed eight Daioyu/Senkaku (Chinese/Japanese name) islands lie to the northeast of Taiwan, with the largest of them two miles long and less than a mile wide. Though barren, the islands are important for strategic and political reasons, as ownership can be used to bolster claims to the surrounding sea and its resources under the United Nations Convention on the Law of the Sea. To date, China and Japan have not resolved their ownership dispute, preventing wide-scale exploration and development of East China Sea hydrocarbons.

Hidden Dragon, Crouching Lion: How China’s Advance in Africa is Underestimated and Africa’s Potential Underappreciated

September 25, 2012 Comments off

Hidden Dragon, Crouching Lion: How China’s Advance in Africa is Underestimated and Africa’s Potential Underappreciated

Source: Strategic Studies Institute, U.S. Army War College

The explosive growth of China’s economic interests in Africa—bilateral trade rocketed from $1 billion in 1990 to $150 billion in 2011—may be the most important trend in the continent’s foreign relations since the end of the Cold War. In 2010, China surpassed the United States as Africa’s top trading partner; its quest to build a strategic partnership with Africa on own its terms through tied aid, trade, and development finance is also part of Beijing’s broader aspirations to surpass the United States as the world’s preeminent superpower. Africa and other emerging economies have become attractive partners for China not only for natural resources, but as growing markets. Africa’s rapid growth since 2000 has not just occurred because of higher commodity prices, but more importantly due to other factors including improved governance, economic reforms, and an expanding labor force. China’s rapid and successful expansion in Africa is due to multiple factors, including economic diplomacy that is clearly superior to that of the United States. China’s “no strings attached” approach to development, however, risks undoing decades of Western efforts to promote good governance. Consequently, this monograph examines China’s oil diplomacy, equity investments in strategic minerals, and food policy toward Africa. The official U.S. rhetoric is that China’s rise in Africa should not be seen as a zero-sum game, but areas where real U.S.-China cooperation can help Africa remain elusive, mainly because of Beijing’s hyper-mistrust of Washington. The United States could help itself, and Africa, by improving its own economic diplomacy and adequately funding its own soft-power efforts.

Country Analysis Brief: China

September 5, 2012 Comments off

Country Analysis Brief: China
Source> Energy Information Administration

China is the world’s most populous country and has a rapidly growing economy, which has driven the country’s high overall energy demand and the quest for securing energy resources. According to the International Monetary Fund, China’s real gross domestic product (GDP) grew at an estimated 9.2 percent in 2011 and 7.8 percent in the first half of 2012, after registering an average growth rate of 10 percent between 2000 and 2011. Economic growth continues to slow in 2012 as the global financial crises unfolds, industrial production and exports decrease, and the government attempts to curb economic inflation and excessive investment in some markets. China mitigated the 2008 global financial crisis with a massive $586 billion (4 trillion yuan) stimulus package spread over two years. The recent global downturn in 2012 has spurred China’s government to begin incremental monetary easing measures and consider a second smaller fiscal stimulus package.

China is the world’s second largest oil consumer behind the United States, and the largest global energy consumer, according to the International Energy Agency (IEA). The country was a net oil exporter until the early 1990s and became the world’s second largest net importer of oil in 2009. China’s oil consumption growth accounted for half of the world’s oil consumption growth in 2011. Natural gas usage in China has also increased rapidly in recent years, and China has looked to raise natural gas imports via pipeline and liquefied natural gas (LNG). China is also the world’s largest top coal producer and consumer and accounted for about half of the global coal consumption, an important factor in world energy-related CO2 emissions.

Coal supplied the vast majority (70 percent) of China’s total energy consumption of 90 quadrillion British thermal units (Btu) in 2009. Oil is the second-largest source, accounting for 19 percent of the country’s total energy consumption. While China has made an effort to diversify its energy supplies, hydroelectric sources (6 percent), natural gas (4 percent), nuclear power (1 percent), and other renewables (0.3 percent) account for relatively small shares of China’s energy consumption mix. The Chinese government set a target to raise non-fossil fuel energy consumption to 11.4 percent of the energy mix by 2015 as part of its new 12th Five Year Plan. EIA projects coal’s share of the total energy mix to fall to 59 percent by 2035 due to anticipated higher energy efficiencies and China’s goal to reduce its carbon intensity (carbon emissions per unit of GDP). However, absolute coal consumption is expected to double over this period, reflecting the large growth in total energy consumption.

Social Security in the BRIC Countries

August 9, 2012 Comments off

Social Security in the BRIC Countries
Source: IMB Center for the Business of Government

Social security is a well-established part of the societal landscape in traditional westernized countries. There are a variety of approaches, and there are substantial differences between the operation of social security under the predominantly insurance-based (or Bismarckian) systems and the social assistance (Beveridge) systems. But both were developed and matured in the context of the industrialization of societies and both reflect the need to provide social protection in mass-scale workforces. It is recognised that (at least historically) the development of social security was seen as a natural complement to the process of economic development. Indeed, they can effectively be characterized as two sides of the same coin.

But what can we draw from the lessons of history and how much do these lessons apply to countries undergoing the 21st century equivalent of the industrial revolution? The so-called BRIC (Brazil, Russia, India, China) countries are experiencing the same kind of growth and rapid change experienced in western economies almost two centuries ago. Certainly, there are similar demands and pressures to balance economic advancement with social protection for those workers who provide the labour to fuel the economic development.

This report examines the existing nature of social security in the BRIC countries in order to consider the likely trajectory of its future development. The report provides a useful reminder that, whilst the underlying pressures are at least to some extent similar,
the starting places and norms are quite different. Also, the globalised world of the 21st century brings new pressures compared with the conditions that applied in the 19th and 20th centuries.

World Cities Culture Report 2012

August 2, 2012 Comments off

World Cities Culture Report 2012 (PDF)
Source: Mayor of London (UK)

The Mayor of London’s World Cities Culture Report 2012 is the biggest international survey of its kind. It has collected an unprecedented amount of data on the scope and impact of the cultural assets and activities that are produced and consumed in 12 major cities:
New York
São Paulo
Using 60 indicators and reports from each of the participating cities, the World Cities Culture Report 2012 shows that culture is seen as important as finance and trade and sits at the heart of public policy.

CRS — China’s Economic Conditions

July 3, 2012 Comments off

China’s Economic Conditions (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Prior to the initiation of economic reforms and trade liberalization 33 years ago, China maintained policies that kept the economy very poor, stagnant, centrally controlled, vastly inefficient, and relatively isolated from the global economy. Since opening up to foreign trade and investment and implementing free market reforms in 1979, China has been among the world’s fastest growing economies, with real annual gross domestic product (GDP) averaging nearly10% through 2011. In recent years, China has emerged as a major global economic and trade power. It is currently the world’s second largest economy, largest merchandise exporter, second largest merchandise importer, second largest destination of foreign direct investment (FDI), largest manufacturer, largest holder of foreign exchange reserves, and largest creditor nation.

The global economic crisis that began in 2008 significantly affected China’s economy. China’s exports, imports, and FDI inflows declined, GDP growth slowed, and millions of Chinese workers reportedly lost their jobs. The Chinese government responded by implementing a $586 billion economic stimulus package, loosening monetary policies to increase bank lending, and providing various incentives to boost domestic consumption. Such policies enabled China to effectively weather the effects of the sharp global fall in demand for Chinese products, while several of the world’s leading economies experienced negative or stagnant economic growth. From 2008 to 2011, China’s real GDP growth averaged 9.6%.

Some economic forecasters project that China will overtake the United States as the world’s largest economy within a few years, although U.S. per capita GDP levels are expected to remain much larger than that of China for many years to come. However, the ability of China to maintain a rapidly growing economy in the long run will depend largely on the ability of the Chinese government to implement comprehensive economic reforms that more quickly hasten China’s transition to a free market economy; rebalance the Chinese economy by making consumer demand, rather than exporting and fixed investment, the main engine of economic growth; and boosting productivity and innovation. China faces numerous other challenges as well that could affect its future economic growth, such as widespread pollution, growing income disparities, an undeveloped social safety net, and extensive involvement of the state in the economy. The Chinese government has acknowledged that its current economic growth model needs to be altered. In October 2006, the Chinese government formally outlined a goal of building a “harmonious socialist society” by taking steps (by 2020) to lessen income inequality, improve the rule of law, enhance environmental protection, reduce corruption, and improve the country’s social safety net (such as expanding health care and pension coverage to rural areas). In addition, the government announced plans to rebalance the economy and boost innovation.

China’s economic rise has significant implications for the United States and hence is of major interest to Congress. On the one hand, China is a large (and potentially huge) export market for the United States. Many U.S. firms use China as the final point of assembly in their global supply chain networks. China’s large holdings of U.S. Treasury securities help the federal government finance its budget deficits and keep U.S. interest rates low. However, some analysts contend that China maintains a number of distortive economic policies (such as an undervalued currency and protectionist industrial policies) that undermine U.S. economic interests. They warn that efforts by the Chinese government to promote innovation could mean that Chinese firms will increasingly pose a “competitive challenge” to many leading U.S. industries. This report surveys the rise of China’s economy, describes major economic challenges facing China, and discusses the challenges, opportunities, and implications of China’s economic rise for the United States.

CRS — U.S.-China Military Contacts: Issues for Congress

June 26, 2012 Comments off

U.S.-China Military Contacts: Issues for Congress (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

This CRS report, updated as warranted, discusses policy issues regarding military-to-military (mil-to-mil) contacts with the People’s Republic of China (PRC) and provides a record of major contacts and crises since 1993. The United States suspended military contacts with China and imposed sanctions on arms sales in response to the Tiananmen Crackdown in 1989. In 1993, the Clinton Administration re-engaged with the top PRC leadership, including China’s military, the People’s Liberation Army (PLA). Renewed military exchanges with the PLA have not regained the closeness reached in the 1980s, when U.S.-PRC strategic cooperation against the Soviet Union included U.S. arms sales to China. Improvements and deteriorations in overall bilateral relations have affected military contacts, which were close in 1997-1998 and 2000, but marred by the 1995-1996 Taiwan Strait crisis, mistaken NATO bombing of a PRC embassy in 1999, the EP- 3 aircraft collision crisis in 2001, and aggressive maritime confrontations (including in 2009).

Issues for Congress include whether the Obama Administration has complied with legislation overseeing dealings with the PLA and pursued contacts with the PLA that advance a prioritized set of U.S. security interests, especially the operational safety of U.S. military personnel. Oversight legislation includes the Foreign Relations Authorization Act for FY1990-FY1991 (P.L. 101-246) and National Defense Authorization Act (NDAA) for FY2000 (P.L. 106-65). Skeptics and proponents of military exchanges with the PRC have debated whether the contacts have achieved results in U.S. objectives and whether the contacts have contributed to the PLA’s warfighting capabilities that might harm U.S. security interests. Some have argued about whether the value that U.S. officials place on the contacts overly extends leverage to the PLA. Some believe talks can serve U.S. interests that include conflict avoidance/crisis management; militarycivilian coordination; transparency and reciprocity; tension reduction over Taiwan; weapons nonproliferation; nuclear/missile/space/cyber talks; counterterrorism; and POW/MIA accounting.

In part of 2010 and 2011, the PLA criticized U.S. arms sales to Taiwan and claimed to “suspend” many U.S.-PRC military contacts. Then, in 2011, the PLA hosted Secretary Gates in January, and the PLA Chief of General Staff visited in May. In May 2012, PLA General Liang Guanglie visited as the first PRC Defense Minister to do so since 2003.

Policymakers could review the approach to mil-to-mil contacts, given concerns about crises. U.S. officials have faced challenges in cooperation from the PLA. The PLA has tried to use its suspensions of exchanges while blaming U.S. “obstacles” (including arms sales to Taiwan, legal restrictions on contacts, and the Pentagon’s reports to Congress on the PLA). The PRC’s harassment of U.S. surveillance ships (in 2009) and increasing assertiveness in maritime areas have shown the limits to mil-to-mil talks and PLA restraint. Still, at the Strategic and Economic Dialogue (S&ED) in July 2009, President Obama called for military contacts to diminish disputes with China. The U.S. military seeks to expand cooperation with the PLA. The NDAA for FY2010 (P.L. 111-84) amended P.L. 106-65 for the annual report on PRC military power to expand the focus to security developments involving the PRC, add cooperative elements, and fold in another report on mil-to-mil contacts. However, the Administration was late in submitting this report in 2010 and in 2011 (not until August). Enacted as P.L. 112-81 on December 31, 2011, the FY2012 NDAA required reporting on cyber threats but did not require a change back to the original title, while adding a requirement for a report from the Defense Secretary before any waiver of a ban on defense procurement from PLA companies. H.R. 4310 and S. 3254, NDAA for FY2013, would strengthen the annual report on military and security challenges and mil-to-mil engagement.

CRS — U.S.-Taiwan Relationship: Overview of Policy Issues

June 19, 2012 Comments off

U.S.-Taiwan Relationship: Overview of Policy Issues (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

The purpose and scope of this CRS Report is to provide a succinct overview with analysis of the issues in the U.S.-Taiwan relationship. This report will be updated as warranted. Taiwan formally calls itself the sovereign Republic of China (ROC), tracing its political lineage to the ROC set up after the revolution in 1911 in China. The ROC government retreated to Taipei in 1949. The United States recognized the ROC until the end of 1978 and has maintained a non-diplomatic relationship with Taiwan after recognition of the People’s Republic of China (PRC) in Beijing in 1979. The State Department claims an “unofficial” U.S. relationship with Taiwan, despite official contacts that include arms sales. The Taiwan Relations Act (TRA) of 1979, P.L. 96-8, has governed policy in the absence of a diplomatic relationship or a defense treaty. Other key statements that guide policy are the three U.S.-PRC Joint Communiques of 1972, 1979, and 1982; as well as the “Six Assurances” of 1982. (See also CRS Report RL30341, China/Taiwan: Evolution of the “One China” Policy—Key Statements from Washington, Beijing, and Taipei.)

For decades, Taiwan has been of significant security, economic, and political interest to the United States. In 2011, Taiwan was the 10 th -largest U.S. trading partner and the 6 th -largest market for U.S. agricultural exports. Taiwan is a major innovator of information technology (IT) products. Ties or tension across the Taiwan Strait affect international security (with potential U.S. intervention), the U.S.-Taiwan relationship, and U.S.-PRC cooperation. While the United States does not diplomatically recognize Taiwan, it is a significant autonomous actor in the world. Today, 23 countries including the Vatican have diplomatic relations with Taiwan as the ROC. Taiwan’s 23 million people enjoy self-governance with free elections. After Taiwan’s presidential election in 2008, the United States congratulated Taiwan as a “beacon of democracy.” Taiwan’s democracy has allowed its people a greater say in their status, given competing party politics about Taiwan’s national political identity and priorities. Taiwan held presidential and legislative elections on January 14, 2012. Kuomintang (KMT) President Ma Ying-jeou won re-election against the candidate from the Democratic Progressive Party (DPP).

Since Taiwan and the PRC resumed their quasi-official dialogue in 2008 under President Ma and cross-strait tension decreased, some have stressed concerns about steps seen as needed to be taken by the United States and by Taiwan to strengthen their relationship. Another approach has viewed closer cross-strait engagement as allowing U.S. attention to shift to expand cooperation with a rising China, which opposes U.S. arms sales and other dealings with Taiwan. In any case, Washington and Taipei have put more efforts into their respective relations with Beijing, while contending that they have pursued a positive, parallel U.S.-Taiwan relationship.

Taiwan’s President Ma Ying-jeou has sought U.S. support for his policies, including U.S. arms sales and Taiwan’s inclusion in the U.S. Visa Waiver Program (VWP). Taiwan also has asked for an extradition treaty. Another U.S. policy issue has concerned whether to resume Cabinet-level visits. The United States and Taiwan have sought to resume trade talks under the Trade and Investment Framework Agreement (TIFA), but there have been U.S. concerns about Taiwan’s restrictions on U.S. beef. Taiwan seeks support for participation in international organizations.

Legislation in the 112 th Congress include H.Con.Res. 39, H.Con.Res. 77, H.Con.Res. 122, H.R. 2583, H.R. 2918, H.R. 2992, H.R. 4310, H.R. 5902, S. 1539, S. 1545, and S.Con.Res. 17. Other congressional actions have focused on arms sales to Taiwan, particularly the issue of whether to sell F-16C/D fighters. (See CRS Report RL30957, Taiwan: Major U.S. Arms Sales Since 1990.)

Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China 2012

June 14, 2012 Comments off

Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China 2012 (PDF)

Source: U.S. Department of Defense

THE PEOPLE’S REPUBLIC OF CHINA (PRC) is pursuing a long-term, comprehensive military modernization program designed to improve the capacity of China’s armed forces to !ght and win “local wars under conditions of informatization,” or high-intensity, information-centric regional military operations of short duration. China’s leaders view modernization of the Chinese People’s Liberation Army (PLA) as an essential component of their strategy to take advantage of what they perceive to be a “window of strategic opportunity” to advance China’s national development during the !rst two decades of the 21st century. During this period, China’s leaders are placing a priority on fostering a positive external environment to provide the PRC with the strategic space to focus on economic growth and development. At the same time, Chinese leaders seek to maintain peace and stability along their country’s periphery, expand their diplomatic in%uence to facilitate access to markets, capital, and resources, and avoid direct confrontation with the United States and other countries. "is strategy has led to an expansion of China’s presence in regions all over the world, creating new and expanding economic and diplomatic interests.

As these interests have grown, and as China has assumed new roles and responsibilities in the international community, China’s military modernization is, to an increasing extent, focusing on investments in military capabilities that would enable China’s armed forces to conduct a wide range of missions, including those farther from China. Even as the PLA is contending with this growing array of missions, preparing for contingencies in the Taiwan Strait remains the principal focus and driver of much of China’s military investment. In this context, over the past year, the PLA continued to build the capabilities and develop the doctrine it considers necessary to deter Taiwan from declaring independence; to deter, delay, and deny e&ective U.S. intervention in a potential cross-Strait con%ict; and to defeat Taiwan forces in the event of hostilities.

To support the PLA’s expanding set of roles and missions, China’s leaders in 2011 sustained investment in advanced cruise missiles, short and medium range conventional ballistic missiles, anti-ship ballistic missiles, counterpace weapons, and military cyberspace capabilities which appear designed to enable anti-access/ area-denial (A2/AD) missions, or what PLA strategists refer to as “counter intervention operations.” "e PLA also continued to demonstrate improved capabilities in advanced !ghter aircraft, as evidenced by the inaugural %ight testing of the J-20 stealth !ghter; limited power projection, with the launch of China’s !rst aircraft carrier for sea trials; integrated air defenses; undersea warfare; nuclear deterrence and strategic strike; improved command and control; and more sophisticated training and exercises across China’s air, naval, and land forces.

Underscoring the extent to which China’s leaders are increasingly looking to the PLA to perform missions that go beyond China’s immediate territorial concerns, over the past year the PLA deployed assets to support non-combatant evacuation operations from Libya, extended its presence in the Gulf of Aden for a third year of counterpiracy operations, took on leadership roles in United Nations peace operations, and conducted medical exchanges and a service mission to Latin America and the Caribbean using the PLA Navy’s hospital ship.

During their January 2011 summit, President Barack Obama and China’s President Hu Jintao committed to work together to build a cooperative partnership based on mutual respect and mutual bene!t. Within that framework, the U.S. Department of Defense seeks to build a military-to-military relationship with China that is healthy, stable, reliable, and continuous. Strengthening the U.S.-China military-to-military relationship is a part of shaping China’s choices by encouraging it to cooperate with the United States and its allies and partners in the delivery of international public goods, including in such endeavors as counterpiracy, international peacekeeping, and humanitarian assistance and disaster relief operations. As the United States builds a stronger foundation for a military-tomilitary relationship with China, it also will continue to monitor China’s evolving military strategy, doctrine, and force development. In concert with Allies and partners, the United States will continue adapting its forces, posture, and operational concepts to maintain a stable and secure Asia-Paci!c security environment.

Reshoring of Some Chinese Manufacturing Jobs Becoming Likely As Cost Gap is Expected to Shrink to Just 16 Percent Next Year

June 1, 2012 Comments off
The tide has begun to turn on the flow of manufacturing jobs from the U.S. to China and other low-cost countries, according to a new study from The Hackett Group, Inc. (NASDAQ: HCKT). Some companies are already reshoring a portion of their manufacturing capacity, and this trend is expected to reach a crucial tipping point over the next two to three years, as the total landed cost gap between the two nations continues to shrink, driven in part by rising wage inflation in China and continued productivity improvements in the U.S.
At the moment, China remains a manufacturing powerhouse, with nearly 75 percent of the companies surveyed having some manufacturing capability in China for at least three years, either directly or through contract manufacturers. The Hackett Group estimates that Chinese manufactured exports to the U.S. currently support between 15 and 20 million jobs in China.
The Hackett Group’s study offered significant hope for the U.S. jobs market. The study found that companies are exploring reshoring as an option for nearly 20 percent of their offshore manufacturing capacity between 2012 and 2014. This repatriated capacity could roughly offset the jobs that will otherwise move offshore, indicating that the great migration of manufacturing offshore over the past several decades is stabilizing.
Free registration required to access full report.

Adult Awareness of Tobacco Advertising, Promotion, and Sponsorship — 14 Countries

May 28, 2012 Comments off

Adult Awareness of Tobacco Advertising, Promotion, and Sponsorship — 14 Countries
Source: Morbidity and Mortality Weekly Report (CDC)

According to the 2012 Report of the U.S. Surgeon General, exposure to tobacco advertising, promotion, and sponsorship (TAPS) is associated with the initiation and continuation of smoking among young persons. The World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC) requires countries to prohibit all forms of TAPS (2); the United States signed the agreement in 2004, but the action has not yet been ratified. Many countries have adopted partial bans covering direct advertising in traditional media channels; however, few countries have adopted comprehensive bans on all types of direct and indirect marketing. To assess progress toward elimination of TAPS and the level of awareness of TAPS among persons aged ≥15 years, CDC used data from the Global Adult Tobacco Survey (GATS) collected in 14 countries during 2008–2010. Awareness of any TAPS ranged from 12.4% in Turkey to 70.4% in the Philippines. In the four countries where awareness of TAPs was ≤15%, three of the countries had comprehensive bans covering all nine channels assessed by GATS, and the fourth country banned seven of the nine channels. In 12 countries, more persons were aware of advertising in stores than advertising via any other channel. Reducing exposure to TAPS is important to prevent initiation of tobacco use by youths and young adults and to help smokers quit.

CRS — U.S. Assistance Programs in China

May 22, 2012 Comments off

U.S. Assistance Programs in China (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

This report examines U.S. foreign assistance activities in the People’s Republic of China (PRC), including U.S. Department of State and U.S. Agency for International Development (USAID) programming, foreign operations appropriations, policy history, and legislative background. International programs supported by U.S. departments and agencies other than the Department of State and USAID are not covered in this report.

U.S. foreign assistance efforts in the PRC aim to promote human rights, democracy, the rule of law, and environmental conservation in China and Tibet and to support Tibetan livelihoods and culture. The United States Congress has played a leading role in initiating programs and determining funding levels for these objectives. Congressionally mandated rule of law, civil society, public participation, and related programs together constitute an important component of U.S. human rights policy towards China. According to the Organization for Economic Cooperation and Development, the United States is the largest provider of “government and civil society” programming among major bilateral foreign aid donors.

Between 2001 and 2011, the United States government authorized or made available $310 million for Department of State foreign assistance efforts in the PRC, including Peace Corps programs. Of this total, $257 million was devoted to human rights, democracy, rule of law, and related activities; Tibetan communities; and the environment. U.S. program areas include the following: promoting the rule of law, civil society, and democratic norms and institutions; training legal professionals; building the capacity of judicial institutions; reforming the criminal justice system; supporting sustainable livelihoods and cultural preservation in Tibetan communities; protecting the environment; and improving the prevention, care, and treatment of HIV/AIDS in China. The direct recipients of State Department and USAID grants have been predominantly U.S.-based non-governmental organizations (NGOs) and universities. Some Chinese NGOs, universities, and government entities have participated in, collaborated with, or indirectly benefited from U.S. programs and foreign aid grantees. Appropriations for Department of State and USAID programs in China reached a peak in FY2010, totaling $46.9 million. Funding decreased by nearly 20% in FY2011, to an estimated $37.7 million. Further significant reductions are expected in FY2012 and FY2013, resulting in the discontinuation of a number of rule of law and environmental programs.

Some analysts argue that U.S. democracy, rule of law, environmental, and related programs have had little effect in China. Furthermore, some policy makers assert that the United States government should not provide assistance to China because the PRC has significant financial resources of its own, some of them obtained through unfair trade practices, and can manage its own development needs. Other observers contend that U.S. assistance activities in China have helped to protect some rights, build social and legal foundations for political change, and bolster reform-minded officials in the PRC government. Some experts also propound that U.S. programs have nurtured relationships among governmental and non-governmental actors and educational institutions in the United States and the PRC, which have helped to develop common understandings about democratic norms and principles. Other programs are said to have reduced environmental and health threats coming from China. Some analysts posit that U.S. programs in China aim to promote U.S. interests in areas where the PRC government has lacked the expertise or will to make greater progress.

Sustainable low-carbon city development in China

May 20, 2012 Comments off

Cities contribute an estimated 70 percent of the world’s energy-related greenhouse gases (GHG). Their locations, often in low-elevation coastal zones, and large populations make them particularly vulnerable to the impacts of climate change. But cities often take steps, even ahead of national governments, to reduce GHG emissions. So it is with China’s cities, which are well placed to chart a low-carbon growth path to help reach China’s national targets for reducing the energy and carbon intensity of its economy. China’s cities will need to act on multiple fronts, in some cases scaling up elements of existing good practice, in others changing established ways of doing business. Actions affecting land-use and spatial development are among the most critical to achieving low-carbon growth as carbon emissions are closely connected to urban form. Spatial development also has very strong ‘lock-in’ effects: once cities grow and define their urban form, it is almost impossible to retrofit them because the built environment is largely irreversible and very costly to modify. Furthermore, cities need energy-efficient buildings and industries. They need a transport system that offers alternatives to automobiles. They need to shift to efficient management of water, wastewater, and solid waste. And they need to incorporate responses to climate change in their planning, investment decisions, and emergency-preparedness plans.

Full Document (PDF)

CRS — Understanding China’s Political System

May 15, 2012 Comments off

Understanding China’s Political System (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

This report is designed to provide Congress with a perspective on the contemporary political system of China, the only Communist Party-led authoritarian state in the G-20 grouping of major economies. China’s Communist Party dominates state and society in China, is committed to maintaining a permanent monopoly on power, and is intolerant of those who question its right to rule. Nonetheless, analysts consider China’s political system to be neither monolithic nor rigidly hierarchical. Jockeying among leaders and institutions representing different sets of interests is common at every level of the system. A test of the political system will come later this year, when the Communist Party plans to usher in a new set of top leaders at its 18 th Congress. China’s last two major political transitions, in 1997 and 2002, unfolded relatively smoothly. This year, the political system has been shaken by the recent ouster of a senior Party leader, Bo Xilai. The unity of the remaining leadership remains unclear.

The report opens with a brief overview of China’s leading political institutions. They include the Communist Party and its military, the People’s Liberation Army; the State, led by the State Council, to which the Party delegates day-to-day administration of the country; and the National People’s Congress (NPC), China’s unicameral legislature. The NPC is meant to oversee the State Presidency, the State Council, the Supreme People’s Court, the Supreme People’s Procuratorate (China’s public prosecutor’s office), and the military. In practice, the legislature is controlled by the Communist Party and is able to exercise little oversight over any of those institutions.

Following the overview, the report introduces a number of distinct features of China’s formal political culture and discusses some of their implications for U.S.-China relations. Those features include the fact that China is led not by one leader, but by a committee of nine; that provincial leaders are powerful players in the system; that the system treats statements by individual leaders as less authoritative than documents approved by committee; and that ideology continues to matter in China, with the Communist Party facing vocal criticism from its left flank each time it moves further away from its Marxist roots. Other themes include the importance of meritocracy as a form of legitimization for one-party rule, and ways in which meritocracy is being undermined; the introduction of an element of predictability into elite Chinese politics through the enforcement of term and age limits for holders of public office; the Chinese system’s penchant for long-term planning; and the system’s heavy emphasis on maintaining political stability. The next section of the report discusses governance challenges in the Chinese political system, from “stove-piping” and bureaucratic competition, to the distorting influence of bureaucratic rank, to factionalism, corruption, and weak rule of law, as highlighted by the case of the blind legal advocate Chen Guangcheng. A text box discusses the case of the disgraced senior leader Bo Xilai.

The second half of the report is devoted to detailed discussion of China’s formal political structures–the Party, the military, the State, the National People’s Congress, a consultative body known as the China People’s Political Consultative Conference, and China’s eight minor political parties, all of which are loyal to the Communist Party. Also discussed are other political actors who are playing a role in influencing policy debates, including the media, big business, research institutes, university academics, associations, societies, and grassroots non-governmental organizations. The report concludes with a discussion of prospects for political reform, noting that while China’s Premier Wen Jiabao has called for undefined political reform, Party policy is to reject vigorously the notion of a multi-party system, separation of powers, a bicameral legislature, or a federal system, on the grounds that all are unsuited to China’s conditions.

CRS — U.S. Solar Photovoltaic Manufacturing: Industry Trends, Global Competition, Federal Support

May 8, 2012 Comments off

U.S. Solar Photovoltaic Manufacturing: Industry Trends, Global Competition, Federal Support (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Every president since Richard Nixon has sought to increase U.S. energy supply diversity. In recent years, job creation and the development of a domestic renewable energy manufacturing base have joined national security and environmental concerns as rationales for promoting the manufacturing of solar power equipment in the United States. The federal government maintains a variety of tax credits, loan guarantees, and targeted research and development programs to encourage the solar manufacturing sector, and state-level mandates that utilities obtain specified percentages of their electricity from renewable sources have bolstered demand for large solar projects.

The most widely used solar technology involves photovoltaic (PV) solar modules, which draw on semiconducting materials to convert sunlight into electricity. By year-end 2011, the total number of grid-connected PV systems nationwide reached almost 215,000. Domestic demand is met both by imports and by about 100 U.S. manufacturing facilities employing an estimated 25,000 U.S. workers in 2011. Production is clustered in a few states, including California, Oregon, Texas, and Ohio.

Domestic PV manufacturers operate in a dynamic and highly competitive global market now dominated by Chinese and Taiwanese companies. All major PV solar manufacturers maintain global sourcing strategies; the only U.S.-based manufacturer ranked among the top ten global cell producers in 2010 sourced the majority of its panels from its factory in Malaysia. Some PV manufacturers have expanded their operations beyond China to places like the Philippines and Mexico. Overcapacity has led to a significant drop in module prices, with solar panel prices falling more than 50% over the course of 2011. Several PV manufacturers have entered bankruptcy and others are reassessing their business models. Although hundreds of small companies are engaged in PV manufacturing around the world, profitability concerns appear to be driving consolidation, with ten firms now controlling half of global cell and module production.

The Department of Commerce and the U.S. International Trade Commission are investigating allegations that U.S. producers have been injured by dumped and subsidized imports from China. If significant duties are ultimately imposed, U.S. production could become more competitive with imports, but the cost of installing solar systems might rise. On the other hand, a number of federal policies that have helped to spur domestic demand for solar PV products have expired or reached their funding limits. These include the 1603 cash grant program and the advanced energy manufacturing tax credit; S. 591, which would extend the credit, has been introduced in the 112 th Congress. Under current law, the Investment Tax Credit for PV systems will sunset at the end of 2016.

The competitiveness of solar PV as a source of electric generation in the United States will likely be adversely affected both by the expiration of these tax provisions and by the rapid development of shale gas, which has the potential to lower the cost of gas-fired power generation and reduce the cost-competitiveness of solar power, particularly as an energy source for utilities. In light of these developments, the ability to build a significant U.S. production base for PV equipment is in question.

CRS — China’s Rare Earth Industry and Export Regime: Economic and Trade Implications for the United States

May 8, 2012 Comments off

China’s Rare Earth Industry and Export Regime: Economic and Trade Implications for the United States (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Over the past few years, the Chinese government has implemented a number of policies to tighten its control over the production and export of “rare earths”–a unique group of 17 metal elements on the periodic table that exhibit a range of special properties, such as magnetism, luminescence, and strength. Rare earths are important to a number of high technology industries, including renewable energy and various defense systems.

China’s position as the world’s dominant producer and supplier of rare earths (97% of total output) and its policies to limit exports have raised concerns among many in Congress, especially given the importance of rare earths to a variety of U.S. commercial industries (e.g., hybrid and conventional autos, oil and gas, energy-efficient lighting, advanced electronics, chemicals, and medical equipment), as well as to U.S. defense industries that produce various weapon systems. Many are concerned that rising rare earth prices could undermine the global competitiveness of many U.S. firms (lowering their production and employment), impede technological innovation, and raise prices for U.S. consumers. Others are concerned that China’s virtual monopoly over rare earths could be used as leverage against major rare earth importers, such as the United States, Japan, and the European Union (EU).

To many observers, China’s rare earth policies are part of a complex web of Chinese government industrial policies that seek to promote the development of domestic industries deemed essential to economic modernization. In the late 1980s, the United States was the global leader in rare earth production. However, preferential policies by the Chinese government and lax environmental standards there quickly enabled China to become a dominant, low-cost producer of rare earths by the late 1990s. Many analysts contend that China’s recent actions to consolidate its rare earth production and restrict exports are intended to promote the development of domestic downstream industries, especially those engaged in high technology and green technology industries, by ensuring their access to adequate and low-cost supplies of rare earths. It is further argued that China’s rare earth export policies are intended to induce foreign rare earth users to move their operations to China, and subsequently, to transfer technology to Chinese firms. China denies that its rare earth policies are political, discriminatory, or protectionist, but rather, are intended to address environmental concerns in China and to better manage and conserve limited resources.

On March 13, 2012, the United States, Japan, and the EU jointly initiated a World Trade Organization (WTO) dispute settlement case against China’s restrictive policies on rare earths and two other minerals. This case was brought shortly after the United States largely prevailed in a similar WTO case brought against China over its export restrictions on nine raw materials. The Obama Administration has also sought to devise strategies to deal with rare earth shortages, including the development of a diversified global rare earth supply chain, the development of alternative materials, and more efficient use of rare earth, including recycling. A number of bills have been introduced in Congress that seek to address U.S. rare earths shortages. A major issue for Congress raised by the rare earths dispute is whether U.S. trade policy can effectively respond to China’s industrial policies that may negatively impact U.S. economic interests, either through the WTO or other means.

This report examines the economic and trade implications of China’s rare earth policies for the United States.

Aging in Asia: Findings from New and Emerging Data Initiatives

May 4, 2012 Comments off
Source:  National Academy of the Sciences
In Aging in Asia: Findings from New and Emerging Data Initiatives, a new compilation of peer-reviewed papers, researchers discuss emerging data about the various aspects of aging in Asia. The papers were presented at conferences held in Beijing and New Delhi during 2011 as part of a collaborative effort by NAS, Chinese Academy of Social Sciences, Indian National Science Academy, Indonesian Academy of Sciences, and the Science Council of Japan to prepare for the challenges of population aging.

CRS — Rare Earth Elements in National Defense: Background, Oversight Issues, and Options for Congress

May 1, 2012 Comments off
Source:  Congressional Research Service (via Federation of American Scientists)
Some Members of Congress have expressed concern over U.S. acquisition of rare earth materials composed of rare earth elements used in various components of defense weapon systems. Rare earth elements consist of 17 elements on the periodic table, including 15 elements beginning with atomic number 57 (lanthanum) and extending through number 71 (lutetium), as well as two other elements having similar properties (yttrium and scandium). These are referred to as “rare” because although relatively abundant in total quantity, they appear in low concentrations in the earth’s crust and extraction and processing is both difficult and costly.
From the 1960s to the 1980s, the United States was the leader in global rare earth production. Since then, production has shifted almost entirely to China, in part due to lower labor costs and lower environmental standards. China now produces about 97% of rare earth oxides, is the only exporter of commercial quantities of rare earth refined metals, and is the majority producer of the world’s two strongest magnets (samarium cobalt (SmCo) and neodymium iron boron (NeFeB) permanent rare earth magnets). An underinvestment in the U.S. supply chain for rare earths has resulted in a situation where, with few exceptions, there is a lack of domestic refining, fabricating, metal-making, alloying, and magnet manufacturing capacity to process rare earths.
In 2010, a series of events and press reports highlighted what some referred to as the rare earth “crisis.” Some policymakers were concerned that China had cut its rare earth exports and appeared to be restricting the world’s access to rare earths, with a nearly total U.S. dependence on China for rare earth elements, including oxides, phosphors, metals, alloys, and magnets. Additionally, some policymakers had expressed growing concern that the United States had lost its domestic capacity to produce strategic and critical materials, and its implications for U.S. national security.
Pursuant to Section 843, the Ike Skelton National Defense Authorization Act for FY2011 (P.L. 111-383) and S.Rept. 111-201(accompanying S. 3454), Congress had mandated that the Secretary of Defense conduct an assessment of rare earth supply chain issues and develop a plan to address any vulnerabilities. DOD was required to assess which rare earths met the following criteria: (1) the rare earth materials was critical to the production, sustainment, or operation of significant U.S. military equipment, and (2) the rare earth material was subject to interruption of supply, based on actions or events outside the control of the U.S. government. The 7-page report was issued in March 2012.
On March 13, 2012, President Obama announced that the United States had joined with Japan and the European Union to bring a World Trade Organization (WTO) joint dispute resolution case against China because of China’s restrictive policies on rare earths and other minerals.
Given DOD’s assessment of the supply and demand for rare earths for defense purposes, coupled with the recent announcement of Molycorp’s proposed acquisition of Neo Material Technologies, Congress may use its oversight role to seek more complete answers to the following important questions:
• Given Molycorps’ purchase of Neo Material Technologies and the potential for the migration of domestic rare earth minerals to Molycorp’s processing facilities in China, how will this move effect the domestic supply of rare earth minerals for the production of U.S. defense weapon systems?
• Given that DOD’s assessment of future supply and demand was based on previous estimates using 2010 data, could there be concern for a possible rare earth material supply shortage or vulnerability that could affect national security?
• Are there substitutes for rare earth materials that are economic, efficient, and available?
• Does dependence on foreign sources alone for rare earths pose a national security problem?
Congress may encourage DOD to develop a collaborative, long-term, well-thought-out strategy designed to identify any material weaknesses and vulnerabilities associated with rare earths and to protect long-term U.S. national security interests.

Old-Age Disability in China: Implications for Long-Term Care Policies in the Coming Decades

April 20, 2012 Comments off

Old-Age Disability in China: Implications for Long-Term Care Policies in the Coming Decades

Source:  RAND Corporation
Old-age disability and long-term care (LTC) have not yet been well studied in China. Using logistic regressions and a prevalence ratio projection model, and considering international practices, this dissertation addresses three research questions:
  1. What are the key risk factors for old-age disability in China?
  2. What are the projected numbers of older adults with disabilities in China in future decades through 2050?
  3. How can China develop a feasible and sustainable LTC delivery and financing system to address projected growth in LTC needs of this population over the next four decades?

CRS — China and Proliferation of Weapons of Mass Destruction and Missiles: Policy Issues

April 17, 2012 Comments off

China and Proliferation of Weapons of Mass Destruction and Missiles: Policy Issues (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Congress has long been concerned about whether U.S. policy advances the national interest in reducing the role of the People’s Republic of China (PRC) in the proliferation of weapons of mass destruction (WMD) and missiles that could deliver them. Recipients of China’s technology reportedly include Pakistan and countries said by the State Department to have supported terrorism, such as Iran. This CRS Report, updated as warranted, discusses the security problem of China’s role in weapons proliferation and issues related to the U.S. policy response since the mid- 1990s. China has taken some steps to mollify U.S. and other foreign concerns about its role in weapons proliferation. Nonetheless, supplies from China have aggravated trends that result in ambiguous technical aid, more indigenous capabilities, longer-range missiles, and secondary (retransferred) proliferation. According to unclassified intelligence reports submitted as required to Congress, China has been a “key supplier” of technology, particularly PRC entities providing nuclear and missile-related technology to Pakistan and missile-related technology to Iran.

Policy approaches in seeking PRC cooperation have concerned summits, sanctions, and satellite exports. On November 21, 2000, the Clinton Administration agreed to waive missile proliferation sanctions, resume processing licenses to export satellites to China, and discuss an extension of the bilateral space launch agreement, in return for another PRC promise on missile nonproliferation. However, PRC proliferation activities have continued to raise questions about China’s commitment to nonproliferation and the need for U.S. sanctions. The Bush Administration imposed sanctions on 20 occasions on various PRC “entities” (including state-owned entities) for troublesome transfers related to missiles and chemical weapons to Pakistan, Iran, or perhaps another country, including repeated sanctions on some “serial proliferators.” Among those sanctions, in September 2001, the Administration imposed missile proliferation sanctions that effectively denied satellite exports, after a PRC company transferred technology to Pakistan, despite the promise of 2000. In September 2003, the State Department imposed additional sanctions on NORINCO, a defense industrial entity, effectively denying satellite exports to China. However, for six times, the State Department waived this sanction for the ban on imports of other PRC government products related to missiles, space systems, electronics, and military aircraft, and issued a permanent waiver in 2007. Since 2009, the Obama Administration has imposed sanctions on nine occasions on multiple PRC entities for missile or other weapon proliferation.

Skeptics question whether China’s cooperation in weapons nonproliferation warrants the U.S. pursuit of closer ties, even as sanctions were required against PRC technology transfers. Some criticize the imposition of U.S. sanctions targeting PRC “entities” but not the government. Others doubt the effectiveness of any stress on sanctions over diplomacy. Meanwhile, in 2002-2008, the U.S. approach relied on China’s influence on North Korea to dismantle its nuclear weapons. Beijing hosted the “Six-Party Talks” (last held in December 2008) with limited results. China’s approach evolved to vote for some U.N. Security Council (UNSC) sanctions against nuclear proliferation in North Korea and Iran. Some still called for engaging more with Beijing to use its leverage against Pyongyang and Tehran. However, North Korea’s second nuclear test in 2009 and military attacks against South Korea in 2010 prompted greater debate about the value of China’s roles. After much diplomacy, the PRC voted in June 2009 for UNSC Resolution 1874 to expand sanctions previously imposed under Resolution 1718 in 2006 against North Korea and voted in June 2010 for UNSC Resolution 1929 for the fourth set of sanctions against Iran. Also, concerns increased that China expanded nuclear cooperation with Pakistan and could capitalize in oil/gas energy deals in Iran as others enforce unilateral sanctions. Relevant legislation include sanctions against Iran in P.L. 111-195 and P.L. 112-81, and S.Con.Res. 12.


Get every new post delivered to your Inbox.

Join 631 other followers