Posts Tagged ‘Beijing’

Move over London, hello Hong Kong-Beijing-Shanghai as the world’s top financial centre?

May 15, 2018

Chris Rowley says the hunt for the city that will take over London’s mantle as the top global financial centre has been unduly focused on Europe, when Asia is the region to watch

There have been fierce debates in the United Kingdom and the rest of Europe since the Brexit vote about what might happen to the City of London in terms of its position as the world’s pre-eminent financial services centre. These arguments by commentators, practitioners, policymakers and academics disappointingly, but not unexpectedly, have been conducted in a simple, narrow, extremely eurocentric, even ethnocentric, manner which treats the subject as a zero-sum game.

Too many commentators seem to think the “best” and “most obvious” – and by implication “only” – competitors to London’s financial crown are in the European Union. To shed some light on this narrowness, we can look at the widely used Global Financial Centre Index, which ranks all the major centres. Its latest report continues to rank London first but the EU’s most commonly mentioned alternatives ranked poorly. Frankfurt was 20th (down nine places), Paris 24th (up two), Dublin 31st (down one) and Amsterdam 50th (down 17).

A trader from BGC, a global brokerage company in London’s Canary Wharf financial district, reacts as European stock markets open on June 24, 2016, after Britain voted to leave the European Union. Photo: Reuters

Interestingly, too many senior bank executives, especially vastly overpaid US ones, fly into various EU destinations on very short visits and naively proclaim how they could do business in city X, Y or Z. Yet, this is more banker rhetoric than reality. Being shuttled around on closely choreographed and micromanaged visits in these cities bears no connection to the everyday realities of living and working in the location being lauded.

The City’s agglomeration effects and benefit of history, scale and scope of financial services will not be easy to replicate

Thus, too often, the unacknowledged costs of relocating financial services to these alternatives are frequently ignored. These include language capabilities, salaries and bonus structures, direct and indirect tax rates, cost of living, requisite housing and schooling provision, skills base and related support staff, and physical infrastructure. For example, employment in the financial sector in London stands at around 729,600, compared to 333,000 in Paris, but just 74,700 in Frankfurt and only 35,500 in Dublin.

To help put these numbers into perspective, we can look at the scale of some US finance institutions in the UK. JP Morgan alone employs about 16,000 people while Goldman Sachs and Morgan Stanley each employ another 6,000. The City’s agglomeration effects, benefit of history, scale and scope of financial services will not be easy to replicate, especially in the short term, by more niche players.

Frankfurt has been touted as a successor to London as Europe’s premier financial centre, but the city employs only 74,700 financial professionals at the moment. Photo: Bloomberg

In contrast, many leading financial centres in the Asia-Pacific region improved their ratings in the Global Financial Centre Index rankings. Tianjin was a new entrant and Qingdao rose significantly in the ranks. Hong Kong and Shanghai were ranked third and sixth respectively, with Beijing and Shenzhen also in the top 20.

Shanghai and Qingdao were the top two centres that finance professionals thought would become more significant in the future

The index also noted that Shanghai and Qingdao were the top two centres that finance professionals thought would become more significant in the future. This view is underpinned by China’s liberalisation reforms, which include state-led ambitions of developing Shanghai into a global financial centre. However, there are some important constraints to this goal, such as the need for the rule of law, robust institutions and reducing the moral hazard of ultimate government rescue.

Of course, Asian rivals face the huge task of matching not only the depth but also the breadth of London’s financial might. In this respect, the network of China’s financial centres may prove to be important. This might involve creating synergy between the different financial centres with each bringing to bear their own strengths, for example.

The obvious trio would first include Hong Kong, as a well-established and highly developed international financial hub and gateway to China, which attracts leading global commercial and investment banks, and wealth management, hedge fund and private equity firms. Second, Shanghai, as a commercial international financial centre with many financial markets, including stock, gold, financial derivatives and foreign exchange, and which hosts foreign commercial, investment and state banks. Third, Beijing as a political-financial centre with major financial regulatory agencies and state-owned banks.

In sum, the UK’s Brexit vote has raised important issues, including the future of the City of London as the world’s top global financial centre. However, the debate seems to have been reduced to just an inward-looking, EU-focused discussion, whereas the big picture requires us to see that we are now in what will be the Asian century, characterised by the region’s growing and dynamic economies and, in particular, China’s rise.

The fact that the Global Financial Centre Index includes several Chinese centres, some of which performed very well, is indicative of the ongoing shift of global economic power and the increasing importance of China in international finance. We may hypothesise that it will be Asian financial centres, such as Tokyo, Singapore, a hub for Southeast Asian financial networks since the 19th century, and cities in China, not those in the EU, that may prove to be potential competitors to London’s pre-eminence in financial services post-Brexit.

Professor Chris Rowley is a visiting fellow at Kellogg College, University of Oxford. He is a leading figure in the study of employment and human resource management, and business and management in Asia


Train believed carrying top North Korean delegation leaves Beijing

March 27, 2018


BEIJING/SEOUL (Reuters) – A train believed to be carrying a senior North Korean delegation left the Chinese capital on Tuesday following a dramatic whirlwind visit that some reports said included the country’s leader, Kim Jong Un.

The conservative South Korea Chosun Ilbo newspaper, citing an unnamed senior intelligence official, said the delegation had included Kim and that he had since left to return to North Korea.

South Korea’s left-leaning press Hankyoreh also reported Kim had traveled to Beijing for meetings with Chinese President Xi Jinping on Monday afternoon before leaving for a “third location” on Tuesday. It did not cite specific sources.

The Hankyoreh did not specify where the “third location” was but said it could be in China.

 Image result for North Korea train leaves beijing, photos

Hong Kong’s South China Morning Post said Kim was on the train that left Beijing, citing two anonymous sources.

South Korea said it was closely watching events in Beijing, where a foreign ministry spokeswoman deflected a question on whether Kim, his sister or some other senior North Korean was visiting. South Korea’s spy agency declined to confirm the report.

“At present I have no understanding of the situation you mention. If there is news we will release it,” foreign ministry spokeswoman Hua Chunying told a regular daily briefing.

Diplomatic sources in Beijing said a senior North Korean official was in town, but did not know exactly who.

Bloomberg, citing three unidentified sources, reported late on Monday that Kim was in Beijing in what would be his first known trip outside North Korea since taking power in 2011.

The unconfirmed visit came ahead of planned summit meetings with South Korean President Moon Jae-in and U.S. President Donald Trump.

“The presidential Blue House is watching things in Beijing very closely, while keeping all possibilities open,” said the senior official in Seoul, who spoke on condition of anonymity.

Improving ties between North Korea, which is pursuing nuclear and missile programs in defiance of U.N. Security Council resolutions, and China would be a positive sign before the planned summits, he said.

A Reuters reporter saw a convoy leave Beijing’s Diaoyutai State Guest House, where senior foreign leaders often stay, and drive north on Tuesday morning. It was unclear where the convoy was headed.

Later, a Reuters journalist saw what was believed to be the delegation’s train pulling out of a Beijing station. The group was reported to have arrived in China on Sunday after crossing from North Korea in the border city of Dandong.

A senior U.S. official who follows North Korea closely said the available evidence suggested that Kim had traveled to Beijing to meet Chinese President Xi Jinping, but stressed that has not been confirmed.

Underscoring the mystery, one senior Beijing-based diplomatic source told Reuters simply: “We just don’t know.”

One source with ties to China’s leadership said it was possible Kim’s younger sister, Kim Yo Jong, was in town. She visited South Korea for the Winter Olympics last month, paving the way for a summit between the two Koreas.

South Korean news agency Newsis reported that Kim Yo Jong and the North’s ceremonial leader, Kim Yong Nam, were visiting Beijing, citing an unidentified North Korea-related source in Beijing.

 Image result for North Korea train leaves beijing, photos

A train believed to be carrying a senior North Korean delegation leaves the Beijing Railway Station in Beijing, China March 27, 2018. REUTERS/Jason Lee

The pair visited South Korean President Moon Jae-in at his office in Seoul during the Winter Olympics in February.

The U.S. official, speaking on condition of anonymity, said it was unlikely Kim Jong Un would have sent his sister on such an important mission, unlike her ceremonial visit to South Korea for the Olympics.

On the contrary, the official said, a summit with Xi would underscore Kim’s standing as a world leader.


Xi and Kim Jong Un had reasons to meet in advance of Kim’s meetings with Moon and possibly Trump, the U.S. official said.

“Xi has met Trump, and in many respects learned how to deal with him better than some people here do,” the official said.

“At the same time, despite the recent tensions, he needs to know what Kim has in mind for dealing with the South and the U.S., and he still has a lot of leverage with the North.”

Japanese media reported on Monday that a high-ranking Pyongyang official appeared to have arrived by train in Beijing.

The Blue House official said South Korea had been aware of “related movements” in North Korea, such as the train, for a few days but he could not confirm whether Kim or another high-ranking North Korean official was visiting China.

Beijing is the main ally of secretive and isolated North Korea, as well as its biggest trading partner.

China has not confirmed any visit by a North Korean but has not totally censored speculation.

There were posts on Chinese social media talking about the possibility Kim Jong Un was in China, some citing family members in Dandong. The rail journey between Dandong and Beijing covers more than 1,100 km (680 miles). It takes at least 14 hours by ordinary service, according to Chinese railway timetables.

The North Korean leader is due to hold separate summits with South Korea in late April and the United States in May.

“The fact that the summits are being held has been beyond our expectations. Right now, the situation surrounding the Korean peninsula is moving very quickly and it would be inadvisable to think with prejudice,” the Blue House official said.

Kim Jong Un’s father, Kim Jong Il, met then-president Jiang Zemin in China in 2000 before a summit between the two Koreas in June that year.

Kim Jong Il was considered at the time to have made the visit to reaffirm close ties with China.

“North Korea likely wants to confirm its relationship with China and believes it has some leverage with which it can ask for things from China,” said Yoo Ho-yeol, Professor of North Korean studies at Seoul’s Korea University.

“If North Korea speaks with the United States on its own, it might feel it is at a disadvantage but, if it has China as an ally, Pyongyang may think it will be able to protect its interests and profits during the summits.”

Reporting by Ben Blanchard in BEIJING and Christine Kim in SEOUL; Additional reporting by Heekyong Yang in SEOUL and John Walcott in WASHINGTON; Editing by Paul Tait and Nick Macfie

West got China wrong, let’s get Taiwan right

March 17, 2018
By Gerrit van der Wees

Recently, major news media in the US and Europe have been awash with analyses on how the West got China wrong. Prominent publications such as the London-based magazine The Economist (“How the West got China wrong,” March 1) argue that since former US president Richard Nixon’s opening to China, the West had hoped that diplomatic and commercial engagement would bring political and economic openness, but that the gamble has failed.

In their seminal article “The China Reckoning” (Foreign Affairs, March/April), Kurt Campbell and Ely Ratner, officials who served in the administration of former US president Barack Obama, write: “Nearly half a century since Nixon’s first steps toward rapprochement, the record is increasingly clear that Washington once again put too much faith in its power to shape China’s trajectory.”

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US President Richard Nixon (L) toasts with Chinese Prime Minister Chou En Lai

“Neither carrots nor sticks have swayed China as predicted. China has instead pursued its own course, belying a range of US expectations in the process.”

In his Washington Post article “We got China wrong, now what?” (Feb. 28), commentator Charles Lane argues that the US needs a long, sober policy rethink, and that it should “reinvest in traditional alliances with democratic nations in the Asia-Pacific region.”

That is where Taiwan comes in: For too long, Taiwan has been a victim of the over-optimism and unwarranted fascination the US and western Europe had with China. In the 1970s it was shunted aside by Nixon and former US secretary of state Henry Kissinger, as it had to make way for the larger “strategic” interests associated with enhancing relations with China.

Little attention was paid to the fact that Taiwan was under authoritarian rule by the Chinese Nationalists of the Kuomintang. Fortunately for the people of Taiwan, the US Congress pushed through the 1979 Taiwan Relations Act, which maintained a semblance of unofficial relations.

Then, in the 1980s Taiwan went through its momentous transition to democracy, and in the early 1990s, former president Lee Teng-hui (李登輝) presided over a vibrant democracy.

This new situation should have brought about a fundamental shift of Western policy toward Taiwan, but unfortunately it coincided with the economic rise of China: Tempted by the lure of China’s market, the West remained stuck “engaging” China at the expense of better relations with Taiwan.

China’s new strength brought about a major expansion of its political and military prowess, which it used to push Taiwan further into the corner of diplomatic isolation, while attempting to use economic ties to bring about political rapprochement, particularly during the administration of former president Ma Ying-jeou (馬英九) of the Chinese Nationalist Party (KMT).

However, this approach was rejected by a Taiwanese populace that increasingly treasured its own unique identity, and valued its new-found freedoms and hard-fought democracy: In local elections in 2014 and national elections in 2016, the Taiwanese overwhelmingly voted for the Democratic Progressive Party, culminating in the 2016 election of President Tsai Ing-wen (蔡英文).

There is a growing sense that Taiwan’s international isolation should be a thing of the anachronistic past.

Thus, as this much-needed rethink about policy toward China is ongoing, the US and western Europe have an opportunity to get their policy toward Taiwan right, and invest in strengthening relations with a strategic beacon of democracy in the region.

Gerrit van der Wees, a former Dutch diplomat, served as editor of Taiwan Communique from 1980 until 2016. He teaches history of Taiwan at George Mason University in Fairfax, Virginia.

Beijing police order limit on foreigners in university district pizza bars and cafes

March 14, 2018

Restaurants in Wudaokou in the capital’s north say they have been told to not to allow more than 10 foreigners in at any one time

South China Morning Post

PUBLISHED : Tuesday, 13 March, 2018, 7:01am
UPDATED : Tuesday, 13 March, 2018, 4:51pm

ecking various popular student hangouts in Beijing’s university district to make sure they have no more than 10 foreigners inside at any one time, as the stability-obsessed authorities ramp up security for China’s biggest annual political gathering.

Security is usually tight in the capital during important political events, with petitioners kept at arm’s length and activists kept under close watch.

But this time, the focus is also on foreign students in Wudaokou, in the city’s north.

Three restaurants and bars in the area said police had told them in the last week to keep out big groups of foreigners until two days after the end of the annual session of the National People’s Congress.

“Until March 22, every Friday night and Saturday, as requested by local authorities, we can only allow a maximum of 10 foreigners in our store at a time,” a notice at one pizzeria said.

“We appreciate your understanding during these challenging times.”

An employee at the restaurant said the police made the request in person before the weekend, and had returned for regular checks since then.

“We were told that if we did not comply, our business would be shut down immediately,” she said.

A similar notice was posted on the wall at a nearby cafe.

A manager said the police issued the notice last Monday, the first day of the NPC.

She said no reason was given for the restriction on foreigners.

But an officer at the Zhongguancun police station, which oversees the restaurants in Wudaokou, denied that it had imposed any limits on the number of foreign customers.

“We’ve never issued such a notice. We merely told bars and restaurants to control the total number of customers during peak hours, without making any specific requirements,” the officer said, adding that such reminders are common.

But he did acknowledge that security had been stepped up during the annual legislative and political advisory meetings.

“[Security control] is definitely normal practice, but everything is stricter during the two sessions,” the officer said.

The three restaurants contacted by the South China Morning Post confirmed that there was a general cap on customer numbers, but added that the restriction on foreigners was also being strictly enforced.

“We can’t let foreigners in our door after 8pm,” said an employee at a pizza shop.

“There are police officers patrolling outside every night. Plus, there are security cameras everywhere in the restaurant and on the street – the feeds are all connected to police stations.”

Fernando, a 23-year-old Master’s student at Peking University who lives in Wudaokou, said he found these measures racist.

“I can understand the party doesn’t want any tumults or incidents to make it ‘lose face’ during such an important time, but it’s a discriminatory measure against foreigners,” he said.

“It’s not that we’re going to be the ones that are starting a revolution to get rid of the party.”

A frequent customer of both the pizzeria and cafe, he added that their customers are predominantly foreigners.

Malcolm Surer, 25, also a student at Peking University, said the measures were in line with the government’s ongoing efforts to clean up Wudaokou and other bar areas in the city.

Before the Communist Party’s five-yearly national congress in October, many bars and clubs in Sanlitun, a nightlife district in eastern Beijing, were forced to close for about 10 days.

China New Year (Year of the Dog) Starts Quietly — Firecrackers, fireworks banned in the name of lessening air pollution

February 16, 2018


© AFP | A man prays with incense sticks to celebrate the Lunar New Year, which has had an unusually subdued start in Beijing
BEIJING (AFP) – Beijing began the Year of the Dog Friday with eerily silent streets, as the usual thunderous bursts of firecrackers and fireworks were silenced by a strict ban that sacrifices tradition in the name of an anti-pollution campaign.Overnight, police patrolled deserted neighbourhoods in the Chinese capital — normally abuzz with excitement as the country welcomes the arrival of the Lunar New Year.

“I never imagined it would be this quiet! It’s usually packed,” said a Beijing resident surnamed Wang who had been out in the city centre following a traditional New Year’s Eve family dinner.

A migrant worker from neighbouring Hebei province surnamed Zhu said that without the firecrackers, “the magic of the New Year is gone”.

The low-key celebrations were in stark contrast to previous years, when the streets were crammed with Beijingers setting off firecrackers and the sky was lit by near-constant firework displays, unleashing a deafening thunder until dawn.

But the tradition, conceived as a way to ward off evil spirits, has this year been targeted by authorities anxious to lower winter pollution levels.

Some 440 Chinese cities have banned the use of firecrackers and fireworks — which are also set off during weddings or when moving house — since last year. Beijing introduced a ban in December.

“Like all Beijingers, I have been lighting firecrackers since I was a child. But times have changed (…) air quality is what matters most to people now,” said a man who gave his surname as Zhang.

The government has launched a huge campaign to reduce pollution during the winter, ordering polluting factories to leave Beijing and its surroundings, and designating “no-coal zones” where more than three million homes have abruptly switched to gas or electric heating.

In 2017, the level of PM2.5 particles — which penetrate deep into the lungs — in Beijing over the New Year was 26 times higher than the level recommended by the World Health Organisation.

But on Friday the sky was a brilliant blue.

“It (the ban) is a good thing, given the disastrous state of the environment,” said Xi, a young student, before adding: “Even if it deprives us of a little pleasure”.

– Peace and quiet –

Safety is another reason behind the ban. Every year there are numerous accidents caused by pyrotechnics, many of which are of poor quality in China.

Dong Weiwei, a resident who had volunteered to patrol his street, stood ready to alert police should he see anyone flouting the new regulations.

“In the past I have seen people wounded, an eight-year-old child whose finger was blown off by a firecracker explosion,” he said.

In southwestern Yunann province, a fireworks explosion killed four people and injured five others Thursday night, state media said.

The ban has made some happy, including Zhu Ye, an elderly Beijinger who took advantage of the peace and quiet to take her dog Xiao Mi for a nighttime walk.

“I no longer liked it at my age… with the fireworks and firecrackers everywhere, we didn’t dare to go out,” she said.

“But this year, there are not many people in the streets and I am finally able to walk my dog.”

Ahead of New Year celebrations, hundreds of millions of Chinese travel back to their home towns, often on crowded trains, making it in the world’s largest annual human migration.

Meanwhile in Hong Kong a spectacular fireworks display scheduled to mark Lunar New Year was cancelled as the city mourns victims of a deadly bus crash.

A speeding double-decker overturned in northern Hong Kong on Saturday evening, killing 19 and leaving more than 60 injured, some critically.

Chief Executive Carrie Lam said residents were grieving and wanted “to express their sombre mood”.

In Shanghai thousands flocked to temples to pray for good fortune.

While in Nepal, exiled Tibetans living in Kathmandu carried images of their spiritual leader, the Dalai Lama, as the community — estimated to number in their thousands — gathered to celebrate Lhosar, the Tibetan Lunar New Year, with traditional music and food.

Migrant worker evictions tear at Beijing’s backbone

January 4, 2018


© AFP / by Ryan MCMORROW, Joanna CHIU | Lin Huiqing moved to Beijing to look for work when his children were still in diapers

BEIJING (AFP) – They fuelled their nation’s dramatic economic rise, toiling in jobs far from home, but China’s migrant workers are now finding themselves increasingly unwelcome as authorities try to cap the population explosions in key cities.Lin Huiqing moved to Beijing to look for work when his children were still in diapers.

For the last eighteen years, he has seen his family just once a year, the rest spent doing the hard labour most Beijingers would prefer to avoid.

The 50-year-old is one of hundreds of millions of migrants who moved from the countryside to the cities, a colossal demographic shift that made China’s ascent possible.

But last month Lin was evicted from the village where he lived on the capital’s outskirts, another victim of a city-wide demolition plan to limit Beijing’s population to 23 million by 2020 — a target that could come at the cost of its economy.

“If I go home, I have no way to support my wife and kids,” Lin lamented.

According to the Communist Party mouthpiece People’s Daily, the city plans to demolish 40 million square metres of “illegal” structures.

Many are the homes and shops of low-income migrants like Lin.

When he first arrived in Beijing, Lin and his friends pooled their money and took out loans to purchase delivery trucks.

He made a living hauling the wares of small-scale shopkeepers and traders, but the moving business has taken a hit as the city condemns buildings en masse, evicting tens of thousands into the winter cold.

“Our customers are commoners like us,” he said. “With their small businesses shut down, there’s no stock for us to move. We’re basically unemployed now.”

– ‘Can’t make it here anymore’ –

Authorities say the campaign, which kicked into high gear after a fire in an illegal structure killed 19 in November, is needed to clean the city up once and for all.

But it is also removing vibrant chunks of Beijing’s economy, such as retail and small scale manufacturing, and throwing into chaos other sectors like delivery, the bedrock of the booming e-commerce trade.

Relegated to the periphery, migrants have kept China’s economy humming, handling the difficult, dirty and sometimes dangerous work that the city’s permanent residents won’t do.

Urban industries like construction, domestic work and sanitation are almost completely staffed by migrants.

Eli Friedman, associate professor of international and comparative labor at Cornell University, said China’s biggest cities “simply cannot function without migrant workers”.

“If every non-local were to actually be removed from cities like Beijing, Shanghai, and Guangzhou, these economic engines for the whole country would completely collapse,” he told AFP.

But that is exactly what is happening, said Li Ning, one of the 60,000 delivery drivers who criss-cross Beijing’s streets.

Li was recently evicted from a village on the city’s outskirts, forcing him into an apartment where the rent quadrupled.

Then authorities came for his delivery company’s warehouse, forcing staff to sort packages on the sidewalk and sending his income plummeting.

“In Beijing all the migrants are leaving. We can’t make it here anymore,” he said, adding he plans to leave for good during the upcoming spring festival.

Another delivery franchise owner surnamed Wang said she will “give up” if authorities knock down her current warehouse, which they marked in black paint with the character “chai” — (demolish) — in mid-December.

She had just moved in December 1, after she had to close two other delivery hubs this year, forcing her to cut her work force from 240 couriers to 60.

“There’s no stability. I don’t know what I’ll be facing tomorrow,” she said, tears welling in her eyes.

– ‘Now we have to start over’ –

The demolitions have also hit Beijing’s retail sector, decimating once affordable mom and pop shops and pushing consumers online or into high-end malls.

Two years ago, Ge Guoxiang moved with his wife from their home province of Jiangsu to take over his brother’s textiles stall.

It had thrived for over 20 years in Beijing’s Tuanjiehu Tianyu market. But three months ago, they received notice that authorities will shutter the market.

Dozens of small-scale community markets have been forced to shut down this year — including the iconic Beijing Zoo market, where hundreds of merchants organized rare street protests against the evictions.

Officials said they have designated certain areas in the neighbouring Hebei province where merchants can move their businesses to.

But Ge is unconvinced.

“It takes years for businesses like ours to build up clientele. Now we have to start over,” he said.

“Our clients are mostly older people who don’t know how to shop online. Where will they go?”

by Ryan MCMORROW, Joanna CHIU

China’s Chongqing gas exchange aims to be Asia price benchmark

December 29, 2017

Above, a resident stands next to a newly installed gas meter in Xiaozhangwan village at the outskirts of Beijing. China is also struggling to build the infrastructure needed to freely distribute gas supplies. (Reuters)

CHONGQING, China/SINGAPORE: China plans to launch a natural gas exchange in Chongqing in early 2018, aiming to create an Asian price benchmark as the nation’s use of the fuel surges amid its shift away from coal.

China is the world’s third-biggest consumer of natural gas behind the United States and Russia. An exchange in its fast-growing market would be a strong contender for an Asian gas marker off which other supplies in the region could be priced.
The Chongqing Oil and Gas Exchange — supported by state energy majors, and private and local government-backed gas distributors — would provide a trading platform for domestic output, pipeline imports from Central Asia and Myanmar, and imports of liquefied natural gas (LNG).
Chongqing is China’s second attempt to develop a traded gas market, having set up a similar exchange in 2015 in Shanghai.
An Asian gas price benchmark to stand next to those of the United States and Europe is seen as a key missing piece in establishing a truly global market for natural gas.
“The exchange is a product of the government’s reform push — to hand the pricing power to the market,” Exchange Chairman Zhang Bowen told Reuters.
“The long-term goal is to build the exchange into a benchmark for Asia and to win China its deserved pricing power,” said Zhang, who was previously president of PetroChina Kunlun Energy.
The exchange, led by a board of nine directors including a former PetroChina executive and an ex-senior state planning official, expects to launch electronically-based spot trading of pipeline gas and LNG imports in the first half of next year.
Registered in Chongqing municipality in July with 1 billion yuan ($150 million) in capital, the exchange has a team of 30, including former market developers at state-owned energy giants CNOOC and Sinopec.
“A China gas hub certainly looks attractive from a supply/demand and infrastructure perspective,” said Jeff Brown, president of consultancy Facts Global Energy (FGE).
Chongqing exchange is appraising around 200 potential members, mostly from the consuming hub of eastern China, and will be open to foreign participation in the longer run, said exchange executives.
Still, there are several challenges to overcome, for Chongqing or any other exchanges hoping to establish an active gas trading platform.
“The biggest would be that the government is still heavily involved in ‘guiding’ prices. Access to pipelines and import terminals can also be difficult,” said Brown.
China’s National Development and Reform Commission (NDRC) currently sets wholesale or city-gate gas prices by linking them to alternative fuels such as liquefied petroleum gas (LPG) and fuel oil.
Investors fear China could be as heavy-handed with gas as it has been with coal. Authorities have repeatedly intervened whenever coal prices have risen sharply, contributing to the virtual death of coal futures in Asia.
China is also struggling to build the infrastructure needed to freely distribute gas supplies. An inadequate pipeline grid and insufficient storage helped to trigger a supply crunch this winter after millions of households were switched from using coal to gas for heating.
“Pipelines need to be more connected and greater access allowed for third parties to the grid and terminals. More investments are needed to boost gas storage,” Song Dacai, chairman of the Chongqing exchange’s supervision committee and formerly a pricing official with the NDRC.
The exchange, though, is confident rising demand and slowly expanding gas infrastructure will help it succeed.
Chongqing, with its population of more than 30 million and proximity to Sichuan province’s large gas basin, already has a relatively well-developed gas grid, and distributors there are keen to participate on the exchange.
“As an investor, we are keen to become a market maker, provided that suppliers are ready to post meaningful volumes for us to trade,” said Luo Jing, deputy head of gas development at China Gas Holdings, a piped gas distributor.
State majors are expected to nominate available volumes on the exchange annually or bi-annually, said Zhang, the exchange chairman.
Others that are trying to develop regional gas exchanges as the basis for an Asian benchmark include Shanghai Petroleum and Gas Exchange and the Japan Korea Marker (JKM) by S&P Global Platts.
The Shanghai exchange, launched in 2015, has so far failed to attract much trading interest. China’s financial hub, though, is seen as a potential oil and gas trading center and likely home of China’s long delayed crude oil derivatives contract.
In many way, the JKM, an LNG price assessment, is seen as the strongest contender to become a regional gas benchmark.
“JKM seems to be gaining steam as an Asian gas price … Since LNG is the most commoditized gas in Asia, it seems best placed to emerge as the Asia price marker,” FGE’s Brown said.

10,000 killed in China’s 1989 Tiananmen crackdown: British archive

December 23, 2017


© AFP/File | Beijing residents gather around the smoking remains of over 20 armoured personnel carriers — burnt by demonstrators during clashes with soldiers near Tiananmen Square — on June 4, 1989


At least 10,000 people were killed in the Chinese army’s crackdown on pro-democracy protesters in Tiananmen Square in June 1989, according to a newly released British secret diplomatic cable that gives gruesome details of the bloodshed in Beijing.

“Minimum estimate of civilian dead 10,000,” the then British ambassador Alan Donald said in a telegram to London.

The document, made public more than 28 years after the event, was seen by AFP at Britain’s National Archives.

The estimate, given on June 5, 1989, the day after the crackdown, is almost 10 times higher than estimates commonly accepted at the time, which generally reported a toll ranging from several hundred to more than a thousand dead.

But French sinologist Jean-Pierre Cabestan said the British figure was credible, pointing out that recently declassified US documents gave a similar assessment.

“That’s two pretty independent sources which say the same thing,” said Cabestan, a professor at Hong Kong Baptist University.

The British ambassador’s report was “not particularly astonishing considering how crowded it was in Beijing, the number of people mobilised” against the Chinese government, said Cabestan, who was in the Chinese capital in the days leading up to the crackdown.

Donald’s account gave horrific details of the violence unleashed on the night of June 3-4 when the army entered Beijing to end seven weeks of protests on Tiananmen Square, the symbolic heart of Communist power.

During their advance, armoured personnel carriers “opened fire on the crowd (both civilians and soldiers) before running over them in their APCs,” wrote the ambassador, who said his source was a person who “was passing on information given him by a close friend who is currently a member of the State Council”, the Chinese cabinet.

Once the soldiers arrived in Tiananmen Square, “students understood they were given one hour to leave square but after five minutes APCs attacked,” Donald wrote.

“Students linked arms but were mown down including soldiers. APCs then ran over bodies time and time again to make ‘pie’ and remains collected by bulldozer. Remains incinerated and then hosed down drains.”

At the end of June 1989, the Chinese government had said suppression of the “counterrevolutionary riots” had killed 200 civilians and several dozen police and military.

Nearly three decades after the crackdown, the communist regime continues to forbid any debate on the subject, mention of which is banned from textbooks and the media, and censored on the Internet.

China police detain artist who documented migrant evictions — China cleans up its society — “Sweeping away undesirables”

December 18, 2017


© AFP/File / by Joanna CHIU | Doors sealed by authorities after residents were evicted from a migrant village on the outskirts of Beijing

BEIJING (AFP) – Beijing-based artist Hua Yong has been detained by police after documenting the mass eviction of migrant workers from the Chinese capital, his friends said Monday.”His current situation is unknown. We have contacted his family and lawyer and legal formalities are being processed,” according to a handwritten statement posted to Hua’s Twitter account and signed by artists Ji Feng and Guo Zhenming.

In the weeks before he disappeared, Hua uploaded dozens of videos on YouTube and Chinese social media platform WeChat documenting the destruction of migrant neighbourhoods on the outskirts of Beijing.

Since setting up a YouTube account only two weeks ago, his videos have been viewed tens of thousands of times and some have been translated by others into English.

Hua was taken from a friend’s home in the northern city of Tianjin in the early hours of Saturday after fleeing Beijing to evade police, other friends told AFP.

“Police grabbed him. Didn’t you know? Nobody is able to contact him,” one of them said on condition of anonymity.

The Tianjin public security bureau could not be reached for comment.

– ‘Ruined in an instant’ –

Hua’s videos, usually shot with a selfie stick, brought viewers into recently demolished migrant neighbourhoods and recorded his conversations with displaced low-income workers.

In one he walks between heaps of rubble, gesturing around him and saying, “The sky is very blue today. But look at what’s behind me, all ruined in an instant.”

On Friday night Hua posted several videos on his Twitter account entitled, “They’re here”. In the videos he said police were at the door and he would soon have to leave with them.

“Daddy is using these last minutes to sing you a song, ‘Happy birthday to you’ … Daddy wants our country to be better; It should be just, fair, free and democratic with free speech,” Hua said, addressing his three-year-old daughter.

Hundreds of millions of migrants who moved from China’s countryside to its cities fuelled the country’s dramatic economic boom in recent decades.

But some are no longer welcome in overcrowded Beijing, which seeks to cap its population at 23 million by 2020 and demolish 40 million square metres of illegal structures — mostly shops and homes for migrants — by the end of the year.

Authorities argue that they need to clear dangerous buildings after a fire killed 19 people last month. A blaze in another migrant area killed five people last week.

Fire safety is a major problem in the city’s cheap migrant housing, which often has jerry-rigged electrical wiring and an absence of emergency exits.

But the brutal efficiency of the demolitions and mass evictions has provoked an unusual public outcry that has put officials on edge.

Amnesty International China researcher Patrick Poon said authorities are “very concerned” that discussions about the topic will harm China’s image.

President Xi Jinping has led a sweeping crackdown on civil society since taking power in 2012, targeting everyone from human rights lawyers to celebrity gossip bloggers.

In recent years activists have been jailed on charges such as “picking quarrels and provoking trouble”, “subversion of state power” and defamation for spreading “false rumours” online.

“Ironically, by targeting Hua Yong, it further hurts China’s image when even documenting what happened could be justified as a crime,” Poon told AFP.

by Joanna CHIU

Stark Reality of Chinese Communism — Bustling Beijing migrant area turns into ghost town — closed with concrete and barbed wire

December 15, 2017


© AFP | Dead leaves litter the pavement after authorities swept through the area in a controversial city-wide eviction campaign

BEIJING (AFP) – The narrow alleyways of the Beijing migrant neighbourhood were once crammed with men cooking on outdoor stoves, women hanging clothes to dry and young children playing games.Now dead leaves litter the pavement as a bitterly cold wind blows through empty lanes after authorities swept through the area in a controversial city-wide eviction campaign.


It is one of the myriad migrant neighbourhoods in the capital of 23 million people that have been turned into ghost towns as the government shuts down and demolishes illegal or unsafe structures.

Authorities stepped up the controversial expulsions last month, arguing that they have to clear dangerous buildings after a fire killed 19 people. A blaze in another migrant area killed five people on Wednesday.

The harsh tactics sparked uproar as rural migrants who had been seeking a better life were suddenly given hours to vacate homes in the shivering cold.

When AFP journalists visited Houchang Cun — “the village behind the factories” — in the summer, residents in one densely populated section had been warned that evictions were looming.

This is the scene of desolation the reporters found when they recently returned to the single-storey brick homes.

– Taps off –

In August, shirtless men washed vegetables, brushed their teeth or cleaned themselves in the only facility with running water in the urban “village”.

Today, litter is strewn around the empty space under its tin roof.

The tables that people used to place their bowls or toiletries on are gone.

Even the silvery spigots have been ripped off the walls.

– Movers moved –

Many of the residents were movers. Zhang Zhanrong, a mother in her early 30s, ran her own moving business.

She lived in a one-room dwelling with her husband and son. Wearing a blue dress, she served dinner on a small table, next to a bed and tall armoire.

The mattress now rests diagonally against the wall while the makeshift stove which she shared with her neighbour outside their brick homes is gone.

– Sealed doors –

As the homes were so small, much of life took place outside in the lanes whose entrances have been closed with concrete and barbed wire.

A large grease stain is left on a brick wall where a woman used to cook meals outside her home.

A poster of Chairman Mao Zedong surrounded by officials that hung on a wooden storage space is gone.

An abandoned sink lies on the pavement in front of a home where a woman once hung shirts while another woman washed clothes in a green plastic bucket.

A nail remains on a wall where a woman used to hang garlic.

Purple and flowery sheets are still draped over some entrances in the deserted alleyway.

A mop still hangs from a window next to where a man held his baby in his arms months ago.

The green and brown doors are all shut and bear an official white seal with different dates of evictions in November.

– ‘No use to protest’ –

One couple remained behind, spending days sitting on blankets on a corrugated metal rooftop.

“There’s no heating where we are so it’s warmer out here in the sun,” the husband said, declining to give his name, on a below-freezing day.

The man plans to leave Beijing after he receives his last paycheque from his job as a maintenance worker.

Many residents hailed from the same hamlet in Pengshui, a mountainous region in southwestern Chongqing province, and relocated to Beijing to work menial labour jobs or to start small businesses.

Evictees said they received no compensation and feel forced to return to a place where they have no way of making a living.

“There is no use to protest,” said a woman surnamed Wang. “It will all be gone sooner or later.”