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1 Talking Point 6 Week in 60 Seconds 7 Internet and Tech Week in China 8 Economy 9 Property 11 China Consumer 12 Shipping 13 Energy and Resources 15 February 2013 14 Society and Culture Issue 182 17 And Finally www.weekinchina.com 18 The Back Page Votes for the proletariat? m o c . n i e t s p e a t i n e b . w w w

News that Foxconn will allow its 1.2 million workers to

vote for union representatives causes stir Brought to you by Week in China Talking Point 15 February 2013

A proletarian revolution? Does Foxconn’s union vote mark a new departure for labour politics?

Anyone seen our union rep?

his time last year Foxconn’s worker who told him there could be complaining about low pay and Tmanagement faced an unex - industrial action if the newly im - poor working conditions for its pected twist in its labour relations. posed 49-hour limit on working workers. Under pressure from its interna - hours is not lifted. In part due to pressure from its tional customers – principally Apple That’s created an “unusual sce - clients, Foxconn has sought to im - – the world’s largest manufacturer nario” says Auret Van Heerden of prove its labour relations. Indeed of consumer electronics had prom - the Fair Labor Association. Bizarrely, the big news last week was that the ised limits to the overtime de - it’s now possible that Foxconn’s firm’s workers will soon be able to manded of staff each week. But far workers might go on strike to force elect their union representatives –a from welcoming the new restric - management to let them work groundbreaking change not just for tions, Foxconn’s million-plus army longer. What would Karl Marx make the company but China. of workers were soon demanding of that? the right to work more hours. It would also pose a strange How do unions work in China to - “We are here to work and not to quandary for Foxconn’s mostly day? play, so our income is very impor - American clients. In terms of numbers, China’s trade tant,” a 25 year-old worker told As WiC reported as far back as unions are gigantic. Nearly one out Reuters. issue 63, the Taiwanese firm has of every five Chinese is a paid-up P h o t

o The dispute rumbles on. A radio long struggled with a litany of bad member, the China Daily reported

S o u r reporter from America’s NPR vis - PR – from staff throwing them - in January, with total membership c e :

R e ited Foxconn’s Shenzhen factory selves off its factory rooftops to in - now reaching 258 million, more u t e r s last month. He interviewed another ternational labour activists than all the other unions put to - 1

Week in China Talking Point 15 February 2013

gether worldwide. municipal union told the Southern But the huge number of Metropolis Daily at the time that unionised workers doesn’t equate 163 other enterprises in the city to proportionate power for the would have similar votes when rank-and-file. Despite their title as their own union officials came up “the nation’s leading class” (as per for re-election. the constitution no less), China’s None of these cases has the sym - workers have generally trailed other bolism of more open union elec - sections of society in economic tions at Foxconn. In part that’s due progress since the early 1980s to scale: Foxconn is China’s largest (when the market reform era began private sector employer (it has well in earnest). over a million staff). But it’s also be - In fact, there is only one union in cause the Taiwanese firm has be - China, the All China Federation of come an unwilling crucible for the Trade Unions (ACFTU), below which wider sense of grievance felt by stretches a lengthy chain of sub- many Chinese workers, following a unions set up by province, industry, Riot control at a Foxconn site series of unofficial strikes (main - municipality and district all the way land media reported on the latest in down to the workplace. it will push for worker demands in Beijing at the end of January) and The ACFTU has been awarded its specific instances (especially, it even a factory riot (in Taiyuan last monopoly for a reason. While it has seems, if foreign-owned enter - year, see WiC166). been pushing more keenly for leg - prises are involved) it won’t do so if Also, although it has no con - islation and dispute resolution it means that the higher priorities sumer brands itself, Foxconn gets favouring workers in recent years, it of maintaining social stability and the spotlight because it plays a cru - doesn’t represent their interests in fuelling economic growth are com - cial role in the global supply chain, the adversarial way often associ - promised. most famously making products for ated with unions in other parts of Apple but also for other brands like the world. But the talk of Foxconn’s workers Dell, HP and Sony. In fact, it pro - Instead it serves much more as a having more of a say is new? duces an estimated 40% of the government agency, with loyalty to Not completely. Projects with more world’s consumer electronics, the Party taking precedence over of a grassroots vote have been tri - which makes what happens in its the interests of its members. The alled on a piecemeal basis in the factories more telling from a media setting up of independent, alterna - past. The most recent was in May perspective than for more non-de - tive unions is illegal and although last year, when workers at Japanese- script Chinese SOEs. That’s also why there is no legislation specifically owned Ohms Electronics in Shen - news of its union elections has gar - banning stoppages, the right to zhen elected a new union chief. This nered so many headlines. strike was removed from the Chi - wasn’t a direct election in the sense nese constitution in 1982. Grass - of “one member, one vote”. After a Isn’t Foxconn an unlikely candi - roots worker representation in strike over pay, the municipal union date as a reformer? union roles is limited, with the sen - agreed to a vote that would see It does look like an awkward role ior places usually taken by com - workers elect a committee of 70 by model, especially with Terry Gou at pany management or apparatchik secret ballot. The committee was the helm of Hon Hai, Foxconn’s Tai - appointees. In many cases workers then allowed to nominate candi - wanese parent. don’t even know who their union dates and vote for them. And ac - Gou leads Hon Hai in a paternal - representative is. cording to Elaine Sio-ieng Hui, a re - istic style in which employee opin - That means that industrial con - search assistant at the City ion hasn’t in the past seemed to be a frontations like the National Union University of Hong Kong, trade major priority (see WiC67 for a pro - of Miners’ bitter clash with the union officials retained the right to file of Gou). British government in the mid- nominate candidates for the top The company’s regimented ap - P h o t

o eighties or the periodic general roles of union chair and vice-chair, proach to managing its staff has of -

S o u r strikes that bring France’s trans - although the committee then got to fered easy column inches to its c e :

R e port system to a standstill are un - choose between them. critics for some time. For instance, u t e r s thinkable for the ACFTU. Although A senior figure at Shenzhen’s in the wake of the suicide epidemic 2 Week in China Talking Point 15 February 2013

at Foxconn factories two years ago, reports that workers were being asked to sign contracts promising not to kill themselves were widely credited as accurate, despite denials from the company. This said some - thing for its reputation at the time. Then there was the account of Gou calling in the head of Taipei’s zoo to speak to his senior executives because he thought they had some - thing to learn from zoo keeping techniques. “Hon Hai has a workforce of over one million worldwide and as human beings are also animals, to Foxconn has 1.2 million workers making products like iPhones manage one million animals gives me a headache,“ Gou was reported to So the move is significant, then? people, and many thousands more have said at the corporate gathering. The early reports in the Financial than the votes held at other unions What was intended as a light- Times at the beginning of February in the past. But Xinhua’s description hearted remark resonated uneasily seemed to think so, calling the plans of the electoral process at Foxconn with allegations of sub-standard “nothing short of revolutionary” also suggests something similar to working conditions at Foxconn’s and “paving the way for the first- the Ohms vote in Shenzhen last year, factories. ever competitive elections among rather than a genuinely new depar - So is Foxconn now pushing for a 1.2 million workers”. ture. A “special team” is to be given more responsive union to counter But in contrast to the interna - responsibility for organising the its reputation as a harsh employer? tional press, the Chinese media has vote, the newspaper said, anony - An alternative view is that it had lit - made little mention of the Foxconn mously selecting candidates for tle choice, after Apple grew fearful initiative, including no obvious ref - union roles “after discussing with all that its own brand might be tar - erence in the Workers’ Daily, the workers” (which might take a while, nished alongside that of its key sup - ACFTU’s own newspaper. if all 400,000 are to be asked). This plier. Accordingly, Apple pressured There are different conclusions list will be circulated for public opin - Foxconn to undergo review by the that might be drawn here. One is ion, after which the union panel will Fair Labor Association (FLA), a non- that the measures won’t be as “eventually be elected among the profit network that monitors labour groundbreaking as the international candidates”. standards. The FLA then identified a coverage suggests. An alternative That doesn’t sound like a demo - lack of proper union representation view is that the elections are signifi - cratic vote. Nor is there much sign of as a key failing, alongside lengthy cant enough for the Chinese press to the ACFTU ceding wider control. Ac - working hours, low pay and safety be told not to say much about them cording to Gu Cheng, head of the concerns. for now. municipal union in Shenzhen, “Fox - Apple and some of its multina - On balance, WiC leans more to conn has established a detailed pro - tional peers have taken a lot of crit - the former view than the latter, al - gramme on the election process icism for appearing to care little beit with caveats. under the instruction of the federa - about the low-wage workforce that Xinhua’s English-language edi - tion. Every process, from candidate assembles their products. But the tion was one of the few Chinese news election, public notification to final sense is that much of the impetus sources to mention the story, but it vote, has been clearly regulated sub - for a wider union vote came less seemed fairly underwhelmed by the ject to Chinese laws and regulations.” from disgruntled workers or even news. First it pointed out that the Foxconn too is emphasising the the union bosses promising a current plan applies to the 400,000 continuity of its approach, high - P h o t

o greater effort to represent them, staff on the production line at Fox - lighting that the elections are part

S o u r and more because of demands from conn’s Shenzhen plant, not the full of a process that began with the es - c e :

R e Foxconn’s customers that the work - 1.2 million workforce. Of course, tablishment of the Foxconn Federa - u t e r s ers get more say. that’s still a significant number of tion of Labor Unions, in 2007. 3 Week in China Talking Point 15 February 2013

into any collective bargaining process going on at lower level, rele - gating local union representatives to the sidelines. Jackie Sheehan, an associate pro - fessor in Contemporary Chinese Studies at Nottingham University, was a little more optimistic, telling CNN that the move might be signif - icant if it means that more of Fox - conn’s workers understand that they have a union that is supposed to represent their interests. But Sheehan warned that worker ignorance is a major obstacle and acknowledged the difficulties in getting the message across: “Trying to educate hundreds of thousands of workers in Foxconn’s case will take months, and many of them only stay six months. It’s like run - ning up the down escalator.” Never a sweatshop: Terry Gou, the tycoon who owns Foxconn How about the bigger picture for Yet there is also the suggestion ing works out for positions on the labour relations? that more is being done than might union committees coming up for Foxconn would hardly have an - have been the case without the in - election this year and in 2014. nounced its plans without getting volvement of the Fair Labor Associ - Of course, there is also the ques - approval from the authorities first. ation (and implicitly, in the absence tion of whether having more work - Government officials would have of pressure from Foxconn cus - ers in union positions will end up known that any mention of a more tomers like Apple). with the rank-and-file getting a representative vote was likely to For instance, Foxconn is increas - greater say over pay and conditions. cause a stir, not only because of ing the number of junior em - For now, there seems to be a de - Foxconn’s involvement but also by ployee representatives on union gree of scepticism among the inter - stimulating wider debate about the committees, which was one of the national onlookers. “Foxconn is not longer-term implications for FLA’s recommendations. It has the first company in China that has labour relations. also promised that management tried ‘democratic’ elections,” Anita But policymakers are being won’t be involved in the election Chan, professor at the China Re - pulled in different directions on process, a more specific commit - search Centre at the University of union reform. Clearly they won’t ment than before. Technology in Sydney told Reuters, want to see the ACFTU’s position And it is trying to position itself citing similar moves by Reebok, Wal - undermined. Nor are they likely to as more of a pioneer, presumably in mart and Honda. “They all caught a show much enthusiasm for votes search of a reputational boost. “Our lot of international attention at the in which Party authority is eroded hope is that our efforts in imple - time of the union elections but all or that leads to calls for more open menting these reforms will not only came to nought. It is all PR.” elections in other areas (see WiC123 benefit Foxconn, but also help lift Geoff Crothall, a spokesman for for speculation that a TV talent the standards and practices for our Hong Kong-based China Labour show was pulled on concerns industry in China,” a spokesman Bulletin, a longstanding Foxconn about viewer voting via mobile suggested. critic, was also guarded in his re - phones). Yet there is also aware - P h o t

o sponse, pointing out that there is ness that China’s unions need to

S o u r That sounds like more of a voice still no scope for union member - do more to represent their mem - c e :

R e for the workforce? ship other than the ACFTU. Addi - bers’ views, especially in a context u t e r s Much will depend on how the vot - tionally, ACFTU bosses can still step in which the working population is 4 Week in China Talking Point 15 February 2013

shrinking, the economy is growing bosses grows too wide, and that signs that the Honda dispute was more sluggishly, and millions frustrated workers take their griev - triggering walkouts at other facto - more rural Chinese move to towns ances to the streets rather than rely ries, and the domestic media ran a and cities to work. on the formal channels. number of stories hinting at a “Foxconn’s offer reveals less Something similar happened in bolder, angrier mood on the fac - about the development of workers’ the summer of 2010 when there tory floor. rights in China than it does about was unrest at a Honda component The day after the altercation, the pragmatism of Communist plant in Guangdong province. Wild - union bosses called for calm, issu - Party leaders when faced with the cat strikers scuffled with enforcers ing a qualified apology for their social pressures of urbanisation, brought in by their own union heavy-handedness. labour shortages and a slower econ - bosses (see WiC63). “We pay union But there was also a reminder omy,“ a Financial Times editorial fees every month. You should rep - that workers should toe the official observed a few days after its first re - resent us, so how come you’re beat - line. ports on events in Shenzhen. ing us up,” the pickets cursed, “Please trust the union,” it di - Here, the danger for the govern - according to reports in the South rected. “Trust each level of Party of - ment is that the gulf between the China Morning Post. ficials and government. We will rank-and-file and their union Union executives had acted after definitely uphold justice.” n

Abe’s a Dragon, not a Snake

We screwed up. In last week’s article about the Year of the Snake we listed some famous politicians born in a ‘Snake’ year, including Abraham Lincoln and John F Kennedy. This week we discovered we’d made a mistake. Out of curiosity we had decided to check whether a lot of US presidents were Snakes. Then we realised that we couldn’t just look at the year of their birth, but also needed the exact dates on which China’s Lunar Year fell (it changes every year). It turns out there are two presidents who were born very close to the Chinese New Year period and, accordingly, on the cusp of two zodiac signs. One is William McKinley (he’s a Tiger, but had he been born a day later he’d be a Rabbit). The other is Abraham Lincoln. He was born in the numbering of presidents, as 22nd and 24th). on February 12, 1809; the Lunar New Year fell that We weren’t alone in our confusion about who year on February 14. That means he was born at the qualifies for Snake status. The Shanghai Daily tail end of the Dragon year. So we were wrong to reports on a vibrant debate among Chinese categorise him as a Snake. netizens on the subject, based on the idea of when In total five US presidents were Snakes. Aside from ‘Lichun’ falls. This denotes the commencement of JFK, these were Franklin Delano Roosevelt, William spring and in ancient times was the date often Howard Taft, Henry Harrison and his grandson used for determining the sign of the zodiac. Benjamin Harrison. And it turns out that Snakes are in Normally Lichun falls a few days before the official a dead heat with Rats and Pigs as the most common date of the Lunar New Year. This year it fell on Chinese zodiac for American commander-in-chiefs (at February 4 (while the actual new year was five each). celebrated on February 10).

I The first president, George Washington, was a Rat. l “Netizens are all at sea over whether children l u s t r a Representatives of all twelve signs of the Chinese born between February 4-9 this year come under t i o n :

w zodiac have resided in the White House, but there has the zodiac sign Dragon or Snake,” the newspaper w w . b only ever been one Rooster: Grover Cleveland (unique suggested. Incidentally, if the Lichun system is e n i t a too as the only president to serve non-consecutive e used, Abraham Lincoln does count as a Snake. So, p s t e

i terms and therefore the only one to be counted twice in WiC’s defence, we were at least partly right… n . c o m

5 Week in China The Week in 60 Seconds 15 February 2013

Trading places The major news items from China this week were...

China has passed the US as the world’s biggest trad - 1ing nation as measured by the sum of its exports and imports in 2012. The US held the position for over six decades. US trade in goods totalled $3.82 trillion last year while China’s customs administration reported a trade in goods amounting to $3.87 trillion.

While the Chinese often celebrate the Lunar New Year 2with fireworks, Kim Jong-un (pictured) took things a step further with a nuclear test. The president of North Korea oversaw the country’s third such test this week, surprising even China, his closest ally. Beijing expressed Mr Kiss-kiss Bang-bang: Kim wows the crowds “firm opposition” but reiterated calls for restraint. In a commentary, the Xinhua news agency said the explo - outside the banking system, including corporate bonds sion was an attempt by a “desperate DPRK” to keep a per - and loans by trust companies, expanded far quicker ceived external threat at bay. But there are signs China is than ordinary bank loans, said China’s central bank. The losing patience. The editor of the Global Times wrote: rise underscores the importance of informal lending “North Korea is walking down the wrong path.” channels in China, which are much less transparent than bank lending, and often termed ‘shadow banking’. There Tokyo wants to move ahead with the creation of an are increasing fears that the rise in shadow banking vol - 3emergency hot line to China after accusing Beijing of umes poses a risk to the financial system. using weapons-targeting radar against its naval forces (an allegation that China has denied). “A hot line may not be The Committee on Foreign Investment in the US has enough. We’d also like to consider creating a framework 5also approved CNOOC’s $18 billion bid for Canada’s where vessels of both parties can directly communicate Nexen, paving the way for the completion of China’s on-site to avoid such incidents,” said Japan’s Parliamen - largest foreign acquisition to date. The deal was subject tary Secretary for Defence Sato Masahisa. to US approvals because Nexen controls oil and gas as - sets in the Gulf of Mexico. China recorded a sharp rise in new loans and other 4forms of financing in January, which suggests strong Shares of Hong Kong jewellery chains Chow Tai Fook, demand for credit as the economy recovers. Lending 6Chow Sang Sang and Luk Fook lost 6-7% over the sec - ond half of last week. Two watch retailers did even worse with Oriental Watch down more than 8% and Emperor Watch & Jewellery down almost 13%. The sell-down is said to be a result of Beijing’s order for an end to adver - tisements that suggest giving gifts to bosses (see page 8).

Fiscal revenue from personal income tax in China 7dropped 3.9% year-on-year in 2012, sharply down from the 25.2% growth seen during the previous year. P h o t

o The government’s tax reduction measures, including

S o u r hikes in exemption thresholds for personal income tax c e :

R e and adjustments in taxation rates, have affected rev - u t e r s Jewellers in Hong Kong: losing their sparkle? enues, said an official from the Ministry of Finance. n 6 Week in China Internet and Tech 15 February 2013

Success in a flash How US investors fell in love with China’s Vipshop

hat was the best performing from $8.4 million in 2010. Wforeign company to go public But the company narrowed the in the US last year? You may be sur - gap quickly last year, doubling sales prised to learn it was Vipshop. More to $630 million and showing posi - eye-opening still: it achieved this tive adjusted net income in the third feat even though its share price ac - quarter for the first time since the tually dropped 15% on its first day of business started in 2008. ventory risk because products that trading in New York last March. That’s no small feat given that weren’t sold could be returned to After that shaky start, its stock Dangdang recorded Rmb320 million vendors too. went on a rip. The Chinese company, ($51.3 million) in losses in the same The business model also tapped which only raised $71.5 million in its period. Similarly, 360buy, one of the into the Chinese obsession for bar - IPO out of a hoped-for $117 million, most successful e-commerce stories gain hunting. As sales are limited- saw its shares surge 174% to $17.84 in China, is reckoned to have lost time only offers, customers feel by the end of last year, leading Rmb2 billion in 2012, according to pressure to purchase as they know Bloomberg to declare it the best IPO Money Week (360buy isn’t listed). they are shopping against the clock, rally of 2012. When a reporter at Money Week Shen also told Money Week. And there’s seemingly no stop - asked Vipshop’s chief executive Perhaps more importantly, Vip - ping it this year, either. It was trad - Shen Ya if he felt vindicated about shop tapped customers in China’s ing at $25.19 as of this Tuesday, al - the surge in the company stock, second and third-tier cities that have most quadrupling its IPO price. That Shen was nonchalance personified: decent purchasing power but less ex - gives it a market capitalisation al - “This is only normal. When we went posure to foreign brands. In fact, Shen most four times that of better- public our stock was being underes - says these cities contribute over 60% known Dangdang, the internet timated. Up or down it’s just a num - of its sales. Sales from trendsetter bookseller that went public in 2010. ber, I’m not too hung up about that.” cities like Beijing, Shanghai, Shen - Based in Guangzhou, Vipshop The road to profitability was zhen and Guangzhou accounted for bills itself as China’s leading online hardly straightforward. Initially Vip - just 13% of revenues, while fourth-tier discount retailer. It offers brand shop adopted a business model sim - cities contributed the rest. name fashion goods via online ilar to Gilt, which sells primarily lux - The company now has 1.5 million “flash sales” or deeply discounted ury designer products. But it quickly active customers, and processes offers valid for only a limited period found out that the luxury goods 10,000 transactions a day. (often stretching across several market in China was not mature But Vipshop’s success has roused days). It’s a business model made enough to generate sustained de - competition. 360buy recently popular by Gilt, the US flash sale mand and the site received insuffi - launched its own flash sale site. But site, but Vipshop says it now carries cient orders. Shen reckons that his new rival more than 5,000 labels, ranging So Vipshop changed tack, focus - doesn’t have the merchandising ex - from Nike to Calvin Klein. ing on mid-tier brands that appeal pertise to threaten Vipshop’s lead. At the time of its IPO analysts more to the mass market. The tim - “Selling apparel is different from were worried that Vipshop, like ing was also good. In 2008 many de - selling a TV. If you want to buy a TV many internet start-ups, was strong signer labels were struggling with it doesn’t matter whether you buy it on growth but weak on profit. In - excess inventory amid weak con - from 360buy or Suning,” Shen P h o deed, there were reasons to be con - sumer sentiment in the US and Eu - warned. “But apparel is different. If t o

C r e cerned. While revenues surged sev - rope. They eagerly shovelled unsold the style doesn’t look good no mat - d i t :

R e enfold in 2011 to $227.1 million, net goods to Vipshop, says 21CN Busi - ter how much discount you give, no u t e r s losses widened to $107.3 million ness Herald. The site had little in - one is going to wear it.” n 7 Week in China Economy 15 February 2013

Ghosts at the feast Takings at hotels and restaurants are down. Blame Xi Jinping

ast week Zhou Shaoqiang was ness. One hit is to hotel and restau - newspaper also reports that the two Lsuspended from his post to rant bottom lines. A report released leading baijiu distillers have seen allow for a period of ‘self-reflection’. last week by the China Cuisine As - their share prices decline 21% and As punishments go, it doesn’t sociation reported that upwards of 19.3% respectively since last No - sound too harsh. But in the current 60% of restaurants have seen ban - vember (although an industry scan - climate it could prove a devastating quet bookings cancelled since the dal involving Jiugui Liquor and plas - blow to his career. Zhou is general austerity campaign was launched. ticiser agent won’t have helped, see manager at the state-owned firm The Beijing Youth Daily re - WiC174.) Zhuhai Financial Investment Hold - ports that one five-star ho - Food and booze purveyors ings and his transgression was to tel in the capital saw almost are not alone in feeling the host a banquet – a rather lavish one, Rmb10 million in can - chill. Jewellers and watch it seems. Unfortunately for him, celled reservations for Chi - sellers have also been feel - photos of the event then appeared nese New Year dinners, ing the pinch. The South online, as well as estimates that the while the Securities Times China Morning Post re - dinner had cost the public purse estimates that foregone ported that Emperor Watch around Rmb80,000 ($12,831). dinners in the holiday sea - & Jewellery saw its stock fall A subsequent investigation by son would see restaurant 7.14% last Thursday as it be - Zhuhai’s anti-corruption body put takings fall 20%. The Wall came evident that the usual rush the final bill at a lower amount: Street Journal also reported that of Lunar New Year sales was unlikely Rmb37,517 to be precise. caterers in Tianjin feared a 30% fall to materialise. It gave a drop in pur - But the probe confirmed that in takings compared to the same chases of showy gifts for bureaucrats Zhou and his colleagues got through period last year. as a contributing factor. Xinhua had a dozen bottles of rather select Anecdotal evidence of the earlier noted that TV and radio sta - French wine, including a Mouton squeeze has also come out on Sina tions have been ordered not to air Rothschild, a Chateau Angelus and a Weibo too, with a disgrun - the usual ‘gift-giving’ ads to Cos d’Estournel. tled state employee noting discourage the practice. It was a photo of these bottles that the staff’s Lunar New Year ban - But another article from the lined up that proved Zhou’s undoing. quet had been moved to KFC. state news agency reported that His timing could not have been Another industry that is feeling old habits die hard as far as the worse. While bureaucrats have rou - the pinch: the liquor business. As dining practices of many local of - tinely gorged themselves in years we have reported on prior occasions ficials were concerned. The prob - past, new leader Xi Jinping has pub - (see WiC172 for an example), there is lem, it ruminated, was the “cohort licly attacked such cases of govern - a strong correlation between official of pussyfooters” who have been ment waste. He has sought to set a banquets and the sale of high-end trying to avoid detection by bring - personal example. On an official trip baijiu , (strong, distilled grain wines). ing in top chefs to deliver ban - to Hebei late last year it was an - But the China Daily is reporting that quets surreptitiously in their staff nounced that Xi had eschewed a ban - sales of top liquors such as Kwei - canteens, or splitting their feasts quet in favour of a simple meal of chow Moutai and Wuliangye have into smaller get-togethers, which four rustic dishes and a soup. “plummeted” in recent weeks, down are harder to track. The new piece P h o There are signs that Xi’s new pol - about 50% on last year. Prices have of advice “to eat quietly, to take t o

S o u icy is restraining some of the more fallen too, the newspaper says, with gently and to play secretly” is now r c e :

S lavish spending. In fact, for some a single bottle of Feitian Moutai commonplace among China’s h u t t e r segments of the economy the cut - dropping from Rmb1,900 to more extravagant officials, Xinhua s t o c k backs are taking a heavy toll on busi - Rmb1,400 as demand sags. The noted disapprovingly. n 8 Week in China Property 15 February 2013

Long property, short honesty Why a new real estate database has government officials nervous

hy has capitalism worked best Win the West but often had more mixed outcomes elsewhere? For Hernando de Soto (not the Span - ish conquistador but a Peruvian aca - demic hailed by Bill Clinton as “the world’s most important living econ - omist”) the answer is simple and universal: build a property database. In his 2000 book The Mystery of Capital , de Soto pointed to the im - portance of developing formal prop - erty rights within the legal system, most notably through a proper land registry. Formal ownership rights then bring huge advantages in un - How many units are owned by corrupt officials? leashing capital and spurring growth, the Peruvian believed. like the UK, there won’t be a full have been demonstrating what the It turns out de Soto’s ideas have record of prior ownership. Instead a newspaper terms euphemistically not gone unnoticed in China, where more primitive database is planned, “higher political awareness” in show - policymakers first floated the idea of although still enough to offer poli - ing a stubborn reluctance to handle building a national homeownership cymakers more complete market such a “high-risk task.” database in 2010. “Speed up the con - data and give the tax collectors a Nonetheless, frustration is grow - struction of the housing information clearer idea of real estate ownership. ing at the delay. “If our mobile pop - system” is also included as an objec - Is that the issue? You’d think a ulation [of migrant workers] could tive in the 12th Five-Year Plan, cate - proper land registry would be pop - be properly surveyed, why not fixed gorised in fact as ‘a key information ular in China, giving middle class assets?” economist Ma Guangyuan infrastructure project’. homeowners a greater sense of se - told the Southern Metropolis Daily. So why the delay? With State Coun - curity. But the principle may not “The resistance lies in municipal of - cil backing, Jiang Weixin, the housing seem as alluring to those owning a ficials who don’t want to declare minister, announced in a webcast in number of properties. One group their multiple property holdings.” October 2011 that a homeownership with particular concerns will be the Unsurprisingly, Chinese web database covering 40 cities would be government employees who have users are proving keener on the un - put in place by early 2012. More than amassed large property portfolios dertaking than many of those a year on and after repeated post - in spite of meagre salaries. charged with implementing the ponements, China’s pilot land reg - Put simply, the planned housing scheme. Also riled by the delay, ne - istry is still not up-and- running. database could bring some pretty tizens have embarked on a home - To be fair, it took a century of re - dreadful exposure of illicit wealth. ownership database of sorts, by ex - form before Her Majesty’s Land Reg - Investigating the sluggish progress of posing some of the most glaring P h o t

o istry – now in its 150th year – saw the land registry, the Economic Ob - instances of bureaucrats accumu -

S o u r British real estate get centrally server reported last month that the lating multiple properties. c e :

R e recorded. But China’s ambitions are initiative is being met with sustained The endeavour began thanks to a u t e r s a bit more limited in their scale. Un - resistance at local levels. Officials cadre dubbed ‘Uncle House’. Since 9 Week in China Property 15 February 2013

October last year, the nickname has jing properties also acquired using that the rumour was the work of become one of the most popular an illegally obtained Beijing hukou short-sellers looking to drive down keywords in internet search en - or residency permit, sparking fur - the SOHO share price. gines. The label arose after Cai Bin, ther fury. As WiC has reported be - Despite the frantic bouts of accu - a low-ranking bureaucrat from fore, hukou reform is a hot topic. sation and denial, netizen efforts to Guangdong province, was exposed The permits give holders access to expose illicit property wealth are be - for owning 22 homes. Cai was social services in cities, but deny ing hailed as a successful anti-graft sacked but s imilar cases are now be - them to millions of migrant work - campaign. Even Xinhua reckoned ing reported online with furious ers. So how the cadre Gong got hold that the bottom-up approach would regularity. Much as the Watergate of a Beijing hukou was soon being pressure the authorities to launch scandal made the suffix ‘gate’ pop - seized upon as an example of abuse the planned homeownership data - ular for subsequent debacles, ‘Uncle of power, fuelling speculation about base and, earlier this month, the House’ has entered popular usage, how many officials had obtained housing ministry seemed to up the spawning derivatives of a similar ilk, multiple hukou to game property ante. It announced that the State such as ‘Auntie House’ and more. restrictions. “China doesn’t really Council wants the database to cover Many cities have tried to restrict have 1.3 billion people if so many 500 cities by June this year. homebuyers from acquiring more people are getting multiple hukou Is it for real this time? Quite pos - than one apartment, in a bid to cur - so easily,” quipped one user at an sibly. According to official figures, tail price rises. But corrupt cadres internet forum. secondary transactions in Beijing’s have found ways of breaching the The scandals have also proven residential market more than tripled administrative ban, few more cre - uncomfortable for real estate devel - year-on-year in the first two weeks of atively than Zhao Haibin, nicknamed opers, lifting the curtain on shady January – a telling sign that wayward ‘Grandpa House’. He’s an official in sales practices. They’ve confirmed bureaucrats were dumping flats. Lufeng city’s police bureau, who has widely-held suspicions that govern - Citing an internal report by the been caught forging identities to ac - ment officials constitute a key part Communist Party’s anti-corruption quire at least 192 apartments. of the ‘VIP client base’ to whom de - body, the Economic Observer also re - Police have also detained Gong velopers sell multiple properties. ported that fire sales by officials or Aiai, now better known as ‘Sister In an unexpected twist to the un - executives at state firms had been House’, and seven people associated folding saga of ‘Sister House’, it was spotted in 45 cities in total. with her case. A former vice presi - then alleged online that Gong ac - “The housing ministry is essen - dent of a county-level commercial quired many of her own properties tially leaving a short window for bank in Shaanxi province, Gong was in the primary market from SOHO officials to unload their property caught owning more than 40 prop - China. That meant that the Beijing holdings,” the Southern Weekly erties. Most of her holdings – worth developer’s chairman Pan Shiyi was wrote. “Once the property data - $160 million according to whistle - soon taking flak, although he told base is in place, their nappies will blowers and state media – are Bei - his 14 million Sina Weibo followers be undone.” n

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10 Week in China China Consumer 15 February 2013

The Wanda wager Alibaba’s Ma turns down bet with property boss

teve Jobs and Bill Gates traded But Wang wasn’t in the mood for Splenty of barbs over the years humour. His retort? Even at a his - (Jobs said that Gates’ firm had “ab - toric high of Rmb1 trillion in online solutely no taste”, while Microsoft’s sales in the first eleven months of founder described Apple’s software 2012, e-commerce still only com - Fancied a flutter: Wang Jianlin as nothing more than “warmed- prised 3% of total retail spending. over Unix”). Then the property developer went could come at the expense of more But to the surprise of onlookers, through the top 10 US e-commerce conventional shopping channels. when the two industry titans made businesses one by one, noting that The story seems a similar one in a rare joint appearance at the All almost all had their roots in bricks- more developed markets. In the UK, Things Digital conference in 2007 and-mortar businesses (the excep - for instance, high street mainstay their exchange was marked more by tion is Amazon). HMV went into administration in respect than bitter rivalry. To prove his point, Wang then January. In the US, the property In fact, Gates said he’d “give a lot made a bet: if online consumption group Savills told the Financial to have Steve’s taste… The way he had surpassed 50% of China’s total Times that 200 American shopping does things is just different, and I retail volume by 2022, he’d give Ma malls are also set to go out of busi - think it’s magical.” Rmb100 million. But he was to re - ness (out of a national total of about A similarly convivial tone wasn’t ceive the same amount if online con - 1,300, defined by Savills as shoping in evidence when Jack Ma and Wang sumption fell short of that ratio. (Ma complexes larger than 450,000 Jianlin took the stage together in De - didn’t agree to the wager: gambling square feet). cember. The tycoons – who founded is illegal in China, so that may have By contrast, the race is on to make Alibaba Group and Dalian Wanda re - been a wise course.) e-commerce a more integral part of spectively – appeared at CCTV’s 2012 But beneath Wang’s dramatic China’s retail industry, so much so Economic Figures of the Year event. gesture is a genuine worry in the that Wen Jiabao, the outgoing pre - Within minutes their exchange was property sector that e-commerce mier, specially invited Ma to one of a feisty one, escalating into a will undermine the rental yield at his final government meetings in late Rmb100 million ($16 million) bet. traditional retailers. Wang has a lot January to ask about how to stimu - It started with Ma challenging at stake. Dalian Wanda, which late consumer spending online. Wang, chairman of one of China’s claims to be the world’s second During the session, Ma suggested largest commercial property devel - largest property developer by floor elevating e-commerce to the status opers, about the need for physical area, is one of the biggest landlords of a ‘national strategic industry’ (join - storefronts. Bricks-and-mortar re - in China. Last year its malls gener - ing the ranks of sectors like biotech - tailers were a dying breed, the chair - ated customer traffic of around 1.1 nology and new energy), says Beijing man of China’s largest e-commerce billion shoppers. Business Times. company argued. Its business model relies heavily Although he didn’t take Wang’s Ma was in provocative mood. “I’ll too on mall throughput to drive wager, Ma has been professing his tell people like boss Wang that the sales for adjacent office and resi - confidence that he would have been good news is that e-commerce will dential developments. the winner. P h o t o not completely replace bricks-and- China’s e-commerce sector is ex - “E-commerce is not a business

S o u r c mortar. But the bad news is that e- pected to overtake the United States model, it is a lifestyle change. It is a e :

I m

a commerce will essentially replace to become the world’s largest online kind of social progress and it is irre - g i n e

C bricks-and-mortar,” Ma warned, in retail market this year. If it contin - versible,” he told CCTV Dialogue, a h i n a

a joking tone. ues at current growth rates, the gain current affairs show. n 11 Week in China Shipping 15 February 2013

Man the lifeboats Why investors want to throw Cosco’s ‘Captain Wei’ overboard

oseph Conrad’s novels often in - Companies with this designation Jcluded a nautical theme. But he have limits on their daily price was under no illusion about the movement cut to just 5% from 10%, dangers of the deep, warning in The reports Bloomberg. If Cosco’s loss Mirror of the Sea : “The sea has never for 2012 comes out as expected, it been friendly to man. At most it has will also have the unenviable dis - been the accomplice of human rest - tinction of being the largest A-share lessness.” This might ring true for company singled out for special Wei Jiafu, the chairman of China’s treatment, reports the China Times. largest shipping firm, China Cosco. If the situation does not improve Its Shanghai and Hong Kong dual- and there is a loss for a third year listed subsidiary, China Cosco Hold - straight, things become more seri - ings, has issued another profit ous still, with the possibility of warning that investors should fuller suspension in Shanghai or brace themselves for a “significant even a delisting. net loss” for the full year, amount - Not sure why he’s smiling: Wei Any silver lining for the Old Cap - ing to about $1.5 billion. tain, then? One analyst speaking to This would be Cosco’s second give a reasonable explanation to in - Bloomberg said that the threat of consecutive annual loss, coming af - vestors,” he told CBN. suspension makes it “highly likely” ter a hefty $1.66 billion shortfall in Cosco operates a wide range of that the shipping firm will get state 2011. The company made a loss in shipping businesses, including con - support to avoid such an outcome. 2009 as well, and Wei, known as the tainers, logistics and terminals. But In the meantime, Wei has said that “Old Captain” in the domestic press, it is weakness in the dry bulk busi - Cosco is doing everything that it can is now facing a mutiny from minor - ness that is pulling the company to reduce its losses, especially in cut - ity shareholders determined to oust into the red. Accounting for 80% of ting spending. But he also refutes him, reports the shipping publica - the company’s income, difficulties the view that the company’s poor tion Trade Winds. in dry bulk have seen Cosco make performance is due to anything Last year, the same magazine headlines before (reneging on char - other than weak market demand, ranked Wei as the fifth most impor - tering contracts, for instance, see complaining darkly of “a domestic tant person in world shipping. But WiC120). The problems have per - wave demonising state-owned en - this reputation now seems to count sisted, with an industry insider, also terprises”. for little in the campaign against him, speaking to CBN, blaming the com - For all the talk of cost-cutting, which is being led by Zhang pany’s “aggressive expansion strat - Cosco doesn’t seem ready to tie up Yuanzhong, a partner at Beijing Went - egy” at the top of the industry cycle the purse strings completely. ian law firm and a minority share - in 2008. That has left Cosco high- Last month, Reuters reported that holder in Cosco. and-dry financially, with a large, un - the shipping company was mulling Cosco’s management blames the der-utilised fleet in a period of low a €1 billion investment in Piraeus, losses on weak global demand in an demand, when the costs of main - Greece’s largest port, which is cur - industry already suffering from ex - taining ships remain high. rently up for sale as part of Athens’ P h o t o cess shipping capacity. But activist Hence the annual losses, too. Ac - privatisation plan.

S o u r c Zhang thinks there is more to the cording to the rules of the Shanghai Cosco already has a stake in the e :

I m

a story. “If there is a serious problem Stock Exchange, any company that port. But the cost of increasing its g i n e

C in business management and risk posts two consecutive losses is put holding could incite Captain Wei’s h i n a control, the management should on a list for “special treatment”. critics further. n 12 Week in China Energy and Resources 15 February 2013

Pioneering move Sinochem heads to the US to further its domestic shale ambitions

ocated in southwestern Texas, relationships with several of the ma - Lthe Spraberry Trend is a large oil jor oil-producing countries. As of field in the Permian Basin, an area the end of 2011, it enjoyed oil and rich in oil and natural gas. First dis - gas interests in a wide range of loca - covered in the 1940s, as an oil field tions including Brazil and Colom - it was soon subject to a flood of bia, the United Arab Emirates, In - speculators. Promoters went to ex - donesia and (more trickily) Syria. travagant lengths to attract new in - China is thought to have the vestors. One source interviewed for world’s largest shale reserves but the the book Wildcatters: Texas Inde - industry has been slow to take pendent Oilmen describes how Shopping for shale shape. More recently the pace has some of the salesmen “had a whole picked up and the Ministry of Land bunch of models come out to the Sinochem has fewer domestic oil and Resources held its second auc - rig, every one of ‘em nude… I sup - and gas reserves to exploit, making tion for licences in December. A to - pose they sold a lot of interests [in the move to expand overseas a tal of 83 companies made 152 bids, the well].” more pressing choice. An additional reports the broadcaster Al-Jazeera, Half a century later and the advantage to working with a foreign with the more attractive plots draw - Spraberry Trend is still attracting se - partner is the opportunity for tech - ing bids of Rmb1 billion ($160.4 bil - rious interest, although this time for nology transfer. Wan Xuezhi, an en - lion) and more. shale resources. One of the largest ergy analyst at CIConsulting, told The government has ambitious recent investments came from National Business Daily that the targets for shale oil and gas produc - China, as Sinochem Corporation an - deal will allow Sinochem to bring tion: 6.5 billion cubic metres by nounced that it would pay $1.7 bil - advanced US shale gas know-how 2015, with a further goal of 100 bil - lion to acquire a 40% interest in the and equipment back to China. A lack lion cubic metres by 2020 (by com - Wolfcamp shale gas field in the of experience has hindered the de - parison America produced 151 bil - south of Spraberry Trend, reports velopment of the Chinese shale gas lion cubic metres in 2010, according National Business Daily. industry to date, Wan suggested. to the website of the US Energy In - The Chinese energy and chemi - The international push is not formation Administration). cals conglomerate is purchasing the atypical for Sinochem. Its relatively Whether the target can be stake from Pioneer Natural Re - sparse resources within China achieved is open to question, al - sources, and it bears mention as the mean that it has often had to look though deals like Sinochem’s pur - firm’s first overseas acquisition of a abroad for opportunities. For exam - chase of Pioneer in Texas are clearly shale oil and gas field. Pioneer will ple, in the 1980s, it was a very early designed to help Chinese firms get stay on the scene, handling drilling, investor in the US fertiliser indus - up-to-speed as quickly as possible. operations and sales. try, at the time China’s largest over - “This is not going to be as easy as The deal is part of Sinochem’s ef - seas investment, reports the China everybody thought three years ago,” fort to catch up with its domestic ri - Economic Times. Chris Faulkner, chief executive of vals. PetroChina has already started In fact, Sinochem’s original man - Brietling Oil and Gas told Al-Jazeera. developing its shale gas business in date was the import and export of “I think it is starting to sink in that is the provinces of Sichuan and Yun - chemicals and fertilisers (for more a huge challenge for China.” (For nan, for instance, while Sinopec has background on the firm and its more on China’s shale resources, drilled five wells in Guizhou, Anhui push into oil refining, see WiC7). and the challenges of extracting and likewise in Sichuan. China Economic Times also them see our Talking Point in Compared to its larger peers, points out that Sinochem has good WiC151.) n 13 Week in China Society and Culture 15 February 2013

Monkeying about (yet again) Stephen Chow returns to familiar territory with new blockbuster

un Wukong is one of China’s Smost enduring literary charac - ters. Better known as the Monkey King, he has supernatural powers, including an ability to travel 108,000 li (about 54,000km) in a single somersault. And over the years, many of the actors playing this mischievous figure from Jour - ney to the West have been cata - pulted into film fame too. But few have proven as popular in the role as Stephen Chow. Back when his career was beginning, Hong Kong’s king of comedy starred in A Chinese Odyssey Part One and Two (both released in 1994), playing the Monkey King. Both films were hits, propelling Chow to become one of Chinese cinema’s biggest stars. So one might have expected Chow to reappear as the Monkey King in his latest cinematic take on the tale – Journey To the West: Con - quering the Demons. Not so . This is a film that Chow wrote, produced and directed – but he doesn’t feature in it himself. In - Cheeky guy: Stephen Chow gives leading lady Shu Qi a peck stead, actress Shu Qi and actor Wen Zhang lend their star power to the scenes are so disjointed that you al - then got his film break in All For the updated version of the Ming Dy - most feel like every scene is a stand - Winner (1990) and has appeared in nasty epic. alone story… It is very disappoint - more than 50 films since then, “It was Chow himself who had ing,” is the verdict of Hong Kong’s sometimes at a rate of six or seven a asked not to act, because he only Ming Pao Daily. year. Several of these have become wanted to be the best director he No matter, the movie still took local classics, including Fight Back could possibly be,” says Wang Zhon - Rmb78 million ($12.5 million) on its to School (1991), Royal Tramp (1992) glei, president of Huayi Brothers, first day in China on Sunday, beating and God of Cookery (1996). Nearly the film’s China distributor. Painted Skin II for the best opening all of them did well at the box office. So far, reviews of the film have for a Chinese film. Industry ob - “Chow is one of the funniest co - been mixed. “Even though the silly, servers say it could easily reach medians in cinema,” says the lover P h o t

o slapstick parody is unquestionably Rmb600 million in the domestic of Hong Kong films Quentin Taran -

S o u r Chow’s signature, character devel - box office. tino. “Add to that the fact that he’s c e :

R e opment and the plot never came to - Chow got his start as a host of also Hong Kong’s best actor.” u t e r s gether in Journey To The West . The children’s shows in Hong Kong. He However, since Chow’s humour 14 Week in China Society and Culture 15 February 2013

is largely verbal (a nonsense patter production company Bingo has also curities Times says it is unclear how known as mo-lei-tau in Cantonese, seen its share price soar in Hong much Huayi Brothers has invested says TIME magazine, relying heav - Kong, by 80% since the release date in the production or what its antici - ily on Cantonese slang and puns), was set. pated return will be as a distributor. few were expecting that Chow One reason for all the excite - could become a star in the Western ment? As we reported in WiC177, the hemisphere. huge success of the comedy Lost in But in 2001, he wrote, directed Thailand . In December it became and starred in Shaolin Soccer , the the first local production to break Don’t be a tale of a team of misfits and losers Rmb1 billion at the box office. The bad sport who start to win when they bring studio that made the film, Enlight their kung-fu skills to bear on the Media, subsequently experienced State backlash hits swimmer’s pitch. The film broke out of the an almost doubling in its Shenzhen- finances, after he fires coach Asian market and proved a success listed shares. In part that was be - in Europe. Chow then went on to cause Lost in Thailand cost just ack in 2004, Tian Liang, an direct (and star in) Kung Fu Hustle , Rmb30 million to produce, leading BOlympic gold medallist, saw his which is set in Shanghai in the to speculation there would be a career come to an abrupt end when 1930s. The film, co-financed by Co - huge profit for the studio. he was kicked out of the national div - lumbia Pictures and released in Sceptics say investors should ing team. His fans were shocked. 2004, was Chow’s first attempt to show caution about using back-of- After all, it wasn’t long before that win over US audiences. It did well the-envelope calculations to esti - China’s diving prince – only 25 at the locally but wasn’t a huge success mate studio profits using the box time – had returned triumphantly in America. office takings of a single movie. For from the Athens Olympics, where he After that he entered a creative example, Enlight later disappointed picked up gold and bronze medals. lull. Chow produced a few films, but investors when it released results The diver had offended China’s was largely absent from the big that fell well short of the estimates. sports tsars for “taking part in too screen himself. One exception: he National Business Daily reported many commercial activities”. Local wrote, directed and starred in CJ7 , that some analysts reckoned the media reported that Tian wasn’t which he released in 2008. After the film would take its full-year profits showing up to practice on time, after critical and commercial success of above Rmb460 million, but it only hiring an agent for his commercial Shaolin Soccer , this was also a rela - reported Rmb281 million. endeavours (China’s sport bodies tive let-down. In the case of Journey To the West: frown on these Jerry Macguire types). But given Chow’s talent and star Conquering the Demons forecasting Top diving official Zhou Jihong said power, it was only a matter of time the financials becomes even more at the time: “China’s diving team before he returned with a hit movie. complicated. For instance, China Se - would be destroyed if it included an Indeed, his return to the Monkey King franchise looks to be a savvy move, having caused a stir among his fans. In fact his latest film has attracted so much attention that even the Chi - nese brokerage firms are taking heed. Guotai Junan, a stock broker, raised its price target for Huayi Brothers, which is distributing the film and is listed on Shenzhen’s ChiNext. Huayi Brothers hit a 52- week high last Thursday of Rmb19.14. P h o t

o Another broker, Hong Yuan Secu -

S o u r rities, was also bullish, predicting c e :

R e that the film could collect over Rmb1 u t e r s billion in ticket sales, and Chow’s Sun Yang: currently conducting an “in-depth self-examination” 15 Week in China Society and Culture 15 February 2013

undisciplined player like him.” Tian tried but failed to win his place back on the national team (he was relegated to the Shaanxi provin - cial squad, instead). So in 2007, he bowed to the inevitable and an - nounced his retirement from the sport. His experience was taken as a lesson by others to avoid confronta - tion with the sporting authorities. Fast forward to now, and China’s sports world is wondering whether Sun Yang might become the next Tian Liang. That’s because the ath - lete – last year the first Chinese man to win an Olympic gold medal in swimming – has been rebuked for “breaking a series of team Tian Liang: after 2004 Olympic high, his fortunes have since dived rules”. As a result, Sun won’t receive his training allowance for a month, “Sun should be grateful,” says the burden of being a ‘civil servant’ and worse, will be “provisionally Zhang, adding that Olympic winners because the athlete programme is suspended” from all commercial cannot behave as they like. “They state funded. So when tension be - activities, including personal en - have to bear in mind that it is the tween the officials and the athlete is dorsements. system that made them win and high, the sports administrators can “There are only excellent athletes there are many people providing threaten to expel them from the in our college, no special ones,” them with services.” team; the public, too, feels like they warned Li Jianshe, president of the China’s netizens also appear to have a say in demanding that the Zhejiang College of Sports, where think that Sun needs to be disci - athletes put in more effort for the Sun has been training. plined. In a survey conducted by country,” says the internet portal. So what happened? The swimmer Sina, an internet portal, 68.6% of Sun will have to tread carefully if is said to have skipped practice for 17,000 respondents said they were he wants to avoid the same fate as over 40 days, says the Beijing Times. supportive of the sports authority Tian. There are major financial im - Sun has also acknowledged publicly and only 16% thought the punish - plications too, as the swimmer is con - that he has a girlfriend, which has ment too harsh (the remainder were sidered one of the most commer - led to grumblings that he must be undecided). cially successful athletes in China, neglecting the pool as a result. But Last week authorities at the Zhe - having signed endorsement deals his worst offence in the eyes of jiang College of Sports said Sun has with brands like Yili Dairy and Coca- sports authorities was reportedly “conducted an in-depth self-exam - Cola. The China Daily forecasts that demanding the replacement of Zhu ination,” and had vowed to behave Sun’s endorsements could be worth Zhigen, his coach of more than a better. As yet, he hasn’t appeared as much as $20 million this year. decade. The two seem to have been for any public activity. Tencent Perhaps Sun could take a cue estranged for some time with Sun Sports says Sun’s recent troubles are from former diver Guo Jingjing, accusing his coach of “outdated” emblematic of the problems with who was also barred from the na - methods. Zhu, 56, was so upset that the government-funded sports sys - tional squad for becoming too com - he suffered a relapse of high blood tem, which is still mired in old-style, mercial (see WiC93). To safeguard pressure, Xinhua reported. socialist thinking – expensively her own place on the team, Guo The Chongqing Economic Times training athletes from childhood made a tearful plea to the public, quoted Zhang Yadong, a former but then treating them like state saying that her former selfishness chief coach of the national swim - property. was unacceptable because “I belong P h o t

o ming team, as saying that it would “Other than athletes like Ding to the nation”.

S o u r be impossible to replace the coach, Junhui and Li Na [who both broke That kind of attitude, it appears, c e :

R e despite the tensions between the away from the state sports adminis - is what’s required to survive in u t e r s two men. tration], China’s sportsmen all carry China’s sports system. n 16 Week in China And Finally 15 February 2013

Finnegan wakes James Joyce classic becomes an unlikely bestseller

n the first page of Finnegans shops not run out of copies. OWake , James Joyce creates a Its publisher Gray Tan is now hur - word to describe the sound made riedly printing a second edition. when the heavens opened and Dai explains the book’s popular - Joyce: now in Chinese Adam and Eve fell to earth. ity thus: “My translation is lucky This is it: Bababadalgharagh - enough to appear in a period when she always tried to stay true to their takamminarronnkonnbronnton - more Chinese readers have high ed - original meaning. nerronntuonnthunntrovar - ucation and want to read serious, “I chose the most difficult but the rhounawnskawntoohoohoorde- enlightening and challenging works. most convincing way to translate, nenthurnuk . People living in big cities such as that is, to list all possible meanings Now imagine having to trans - Beijing, Shanghai and Shenzhen are that I knew of most words used in late that into Chinese, a language not satisfied with popular culture Finnegans Wake , instead of only in which each word is an estab - and want to learn new things. choosing one or two meanings. I lished character (or a combination Finnegans Wake is said to be a book think many Chinese readers were of two or three characters) and in that could inspire new ideas.” moved by my hard work.” which sounds tend to be percus - Dai adds that she also benefitted And hard work it was. Professor sive and short. from Gray Tan’s decision to run a bill - Dai admits she often quarrelled That was one of the many chal - board campaign publicising the with her husband by staying up late lenges faced by Dai Congrong, a pro - novel – called Fennigen de Shouling Ye to work on the translation. She says fessor of English literature at Shang - in Chinese – as well as to print the her eyes and looks have suffered as hai’s Fudan University. Little wonder book in the classical style with char - a result of the undertaking, too. Dai spent eight years translating the acters running down the page . Dai In many ways that echoes the ex - first book in Joyce’s four-part, thinks this adds to its esoteric quality. periences of Joyce himself who stream-of-consciousness novel. Finnegans Wake is notoriously spent 17 years writing the book, dur - But it seems Dai must have done hard to translate (and tougher still ing which his mental and physical something right, because her trans - to read, many would say) with the health deteriorated. lation has become a surprise hit. By German version taking 19 years to But unlike Joyce, who died two the end of January it had risen to appear, and the French version 30. years after he finished the work, at number two in the sales rankings in Dai told WiC she had to break up least Dai is able to enjoy the fruits of Shanghai and might even have dis - some of Joyce’s long, dream-like her labours. Oh, and start on trans - lodged the book in first place – a bi - sentences so they would make more lating the remaining three books in ography of Deng Xiaoping – had sense to the Chinese reader but that the Finnegans Wake saga . n

Easy as 123

“You just need to understand the rules, follow the rules, be transparent and let them make the decision”

* Pin Ni on getting US government approval to acquire A123, an American car battery maker. Pin is president of the American operations of Wanxiang, a Chinese firm (see WiC92).

17 Week in China The Back Page 15 February 2013

Photo of the Week In Numbers 8.2% The year-on-year increase in China’s retail sales in the first week of the Chinese New Year, a holiday period of peak shopping activity.

50% The drop in Chinese tourists travelling to Japan over the Lunar New Year holiday P h from a year earlier amid heightened o t o

S territorial tension between the two o u r c e countries. Instead, Thailand and South :

I m a Korea were China’s top international g i n e

markets for the weeklong break, C h i n a according to Ctrip, one of China’s biggest travel websites. Titanic performance: Celine Dion sings to 700 million viewers at the Spring Festival Gala show aired on CCTV last Saturday evening 1.2 billion The number of text messages sent by mobile users over the Lunar New Year holiday, according to estimates from Where is it? China’s three major telecoms providers. Some of the places referred to in this issue Sina Weibo, a leading microblog, saw over 34,000 posts in the first second of the Year of the Snake. Beijing Hebei 60 China The number of different toxic chemicals Shaanxi that can be detected by a new at-home Anhui Shanghai testing kit. The kit, developed by Tianjin Sichuan Zhejiang University of Science and Technology, lets Chongqing consumers know within minutes if a food Guizhou sample contains harmful substances. Guangdong Xinhua reckons the kit will be in high Shenzhen Zhuhai Hong Kong demand given rampant food safety concerns in China.

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