FosteringC Businesshina and Cultural HarmonyInsight between China and the U.S. VOL. 9 NO. 8 www.chinainsight.info SEPTEMBER 2010 Chinese Consul General makes Community his inaugural visit to Minnesota By Greg Hugh, Staff Writer pleased to be visiting Minnesota since it authentification to both local Chinese and is one of the nine states that his consulate non-Chinese people.” covers which also includes Illinois, Iowa, The meeting continued as an open Kansas, Colorado, Michigan, Missouri and forum with the group interacting in round Wisconsin. He noted that during recent robin fashion discussing a variety of topics times there have been many meaningful con- with Consul General Yang that ranged from tacts between China and the midwest region education, business and culture. Several Jane Wilson, Honorary Chinese of the United States. Thus he states, “My members of the group asked how the Con- Minnesotan of Note consulate is committed to further promoting sulate could help to establish relationships cooperation and exchanges between the two between local professionals that could pro- Arts sides in various fields, protecting the legal vide their services to businesses in China. rights of Chinese citizens in the consular He responded by stating that anyone can districts and providing consular services send requests regarding any specific ideas related to passport, visa, notary public and or project directly to the Consulate thru the Consul General Yang Guoqiang appropriate channels. ewly appointed Consul General Yang Guoqiang for the Con- Nsulate General of the People’s Republic China in Chicago recently visited with representatives of the Chinese com- munity in Minnesota at a meeting organized by community leader, Vincent Mar. Making his first visit to Minnesota, Consul General Yang traveled with his wife along with sev- eral other staff Consul members based at the Consulate in Chicago. In his opening remarks to the gathering, Consul General Yang (center) with members of the Twin Cities Chinese community. Consul General Yang stated that he was Photo by David Cheng Consul General continues on Page 3 Awash in Cash Why do Chinese banks, swimming in savings, invest in U.S. Treasury bills when rates of return are far higher at Delicate balance is shown in home? The answer may lie in disparity among Chinese firms in productivity and access to credit ‘China in Transition’ By Douglas Clement, Editor, The Region flow to where it can be used most profitably; A theory of structural change if rates of return are higher in productive In “Growing Like China,” forthcoming country A than in low-productivity country in the American Economic Review, with B, capital will flow to A. The same thought coauthors Zheng Song of Fudan University applies to companies: Lenders will invest in and Fabrizio Zilibotti of the University of productive firms that promise higher returns. Zurich, Storesletten proposes a “theory of But in reality, fast-growing, highly pro- economic transition” that accounts for both ductive China sends an enormous amount of the growing foreign surplus and the high resources to other countries—most notably growth/high return to capital that China has by buying U.S. Treasury bills, though they experienced in recent decades. pay very little interest—when companies “What motivated this work,” said Store- within China could put those resources to sletten in a recent interview, “was that we Master Lei’s happy reunion with use by investing in profitable domestic firms were totally puzzled by two observations. his artist friends in St. Paul with far higher rates of return. Surprisingly, Number one: The rate of return from capital within the nation, bank loans tend to flow to in China is very, very high. That has been Culture firms that are relatively unproductive—an shown to hold true if you look at aggregate inefficiency that is one of the few apparent data or micro data. And number two: At brakes on China’s otherwise unrelenting the same time, China is building up a huge economic expansion. surplus [of savings]. So why on earth would What explains these anomalies? Political a country buy low-paying T-bills instead n recent decades, few phenomena commentators often argue that the foreign of exploiting the high rate of return on have been as globally significant as surplus occurs because China manipulates capital?” IChina’s astonishing economic trans- exchange rates, holding the yuan at an arti- According to neoclassical theory, a formation. Over a matter of years, it has ficially low level to the dollar so as to curb country with a high domestic return to transitioned from a poor nation dominated spending on imports while flooding foreign capital should attract large capital inflow by small farmers and enormous, plodding markets with underpriced Chinese exports. from investors in other nations. But China Rare World Map of 1602 state-owned enterprises into a dynamic But recent research by Minneapolis Fed has manifested the opposite. Indeed, foreign economy where private companies shape senior economist Kjetil Storesletten and reserves soared from [US]$21 billion in ALSO IN THIS ISSUE international markets and annual GDP his colleagues provides a simpler explana- 1992 to [US]$2,130 billion in 2009. growth surges past expectations. As this is tion, one that relies on disparities among Of course, China’s economy grew at a Events...... 2 written, economists predict that China will China’s firms in their relative productivity blistering pace during those years; perhaps Commentary...... 3 soon eclipse Japan as the world’s second- and access to credit. Their story, fashioned the rapid growth in foreign reserves simply Arts...... 4 & 8 largest economy, and it is arguably only a into a mathematical model, provides a close represents a constant share of growing eco- Sports...... 5 matter of time before the United States, too, match to the data patterns seen in China’s nomic output. No, the surplus grew faster Education...... 6 places second. economy over the past 20 years and suggests than the economy itself; in 1992 the surplus/ Also remarkable is how China’s growth that China’s growth experience and grow- GDP ratio was 5 percent, but by 2009 it was Finance...... 7 patterns have usurped several core predic- ing surplus must be understood in light of 46 percent (see Chart 1). Community...... 9 tions of conventional economic theory. the structural change the country is going Culture...... 10 & 14-16 Standard models suggest that capital will through. Awash in Cash continues on Page 12 Economy...... 11-13 PAGE 2 > SEPTEMBER 2010 events www.chinainsight.info CAAPAM will host 2010 annual ChinaInsight ChinaInsight is seeking conference: Publisher: Production Editor “Rising Above Uncertain Times!” Gregory J. Hugh Must be passionate about The Chinese American Academic & their body works, how interference to their [email protected] our mission: in addition to being Professional Association in Minnesota nervous systems affects their health, and success-oriented, self-motivated, (CAAPAM) will host its 2010 annual con- ways to improve their health starting today. Editor: resourceful, creative, disciplined ference, “Rising Above Uncertain Times!” Jennifer Nordin The event will include four presentations, “Uncertainty Here; Opportunities There – and community-minded. [email protected] Responsibilities include layout dinner and an open discussion. Looking at China from a Medical and design of 10 issues per year Technology Perspective” Presentations Paul J. Gam Manager of Operations/ using Adobe InDesign and Photo- Circulation: shop, some proofreadiing, must be “Make Your Heart Smile” Paul J. Gam is Vice President of Inter- Richard He Internet savvy. Jon Pojasek national Development at St. Jude Medical, Jon Pojasek is a personal trainer, life Inc. (NYSE:STJ), a Fortune 500 medical [email protected] This is a part-time, coach, and motivational speaker, with a technology company based in St. Paul, volunteer position. smile. Jon is often heard saying “Life is MN. He leads mergers and acquisitions, Marketing Director: short and the time is right to start writing strategic alliances, and other international Will Ahern Contact Greg Hugh at your book of life and happiness” Jon will business development activities. Paul has [email protected] 952-472-4757 or share his passion and experiences with some been the interim Managing Director and General Manager for Asia-Pacific, based in simple strategies to help train and condition Production Editor: [email protected] yourself to live a fullest life. Hong Kong; and started the wholly-owned subsidiary in China, for which he continues Dawn Murphy [email protected] “A Life with Few Options” to serve as Chairman of the Board. hina nsight C I Kao Kalia Yang, Keynote Speaker The conference will be held on Saturday, Artist/Intern: Kao Kalia Yang is a writer from the Sept. 25 at Jun Bo Chinese Restaurant, Lauren Hugh SEEKS ADVERTISING Hmong community. Her first book is The 7717 Nicollet Ave., Richfield, MN 55423. REPRESENTATIVE… Latehomecomer: a Hmong family memoir. All speakers will present in English. There It is the first book to have ever won two Staff Writers: will be a dinner of authentic Chinese cuisine Greg Hugh Must be passionate about our mis- Minnesota book awards as well as nine after the presentations and open discussion [email protected] sion: in addition to being success- other national awards in literature. Kao following the dinner. oriented, must be self-motivated, Kalia Yang is a graduate of Carleton Col- The fee to register for the conference resourceful, creative, disciplined lege and Columbia University in New York only (no dinner) is US$15. The fee to reg- Elizabeth Greenberg and community-minded. City. She is serving as a writer-in-residence ister for conference and dinner is US$30. [email protected] at the University of Wisconsin-Eau Claire. Student can register for the conference Generous Commission Schedule and dinner is US$15. To register for the Anthony James “Knowing Chiropractic Care” CAAPAM 2010 annual conference, send a [email protected] Contact: Greg Hugh Dr. Gary Kiekhoefer check payable to “CAAPAM” to P. O. Box Dr. Gary Kiekhoefer will give an 25767, Woodbury, MN 55125 before Sept. (952) 472-4757 overview of the philosophy and science of Albert Leung 20, 2010. [email protected] chiropractic. He will show how chiropractic E-mail: [email protected] for E-mail: [email protected] fits into the wellness paradigm. Attendees additional information.  will leave with a basic understanding of how Jennifer Nordin [email protected]

Mike Xiong [email protected]

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Editor, ChinaInsight 6520 South Bay Drive Minnetrista, MN 55331 ChinaInsight Insight Tel: 952-472-4757 SUBSCRIPTION ORDER FORM Fax: 952 472-6665 Guaranteed [email protected] 10 issues - $24 for a domestic subscription and $40 for international. YES you could run to the Letters to the Editor become the property of ChinaInsight and may be edited for Please make check payable to ChinaInsight, 6520 South store and pick up a copy, but length and published. Articles will not be Bay Drive, Minnetrista, MN 55331 did you know you can have published without the express consent of the author. Name______ChinaInsight delivered directly Address______to your mailbox? NOTICE TO READERS: The views epressed in articles are the author’s and City/State/Zip______A subscription costs a mere not neccesarily those of ChinaInsight. Phone______$24 and brings a full year (10 Authors may have a business relationship issues) of new understand- with the companies or businesses they Email______discuss. Company______ing about today’s China, from language to business oppor- Title______tunities. Copyright 2010 ChinaInsight, Inc. All Rights Reserved. www.chinainsight.info commentary SEPTEMBER 2010 > PAGE 3 Is China Growing Advertisers Your potential customers are Too Big? reading ChinaInsight. Op/Ed Commentary: Chris Devonshire-Ellis Shouldn’t you be bringing Aug. 23 – For many years now, as dong New Area. them in the door with an ad? I’ve traveled China on business, I’ve been skeptical of the GDP growth figures. From Zhengdong New Area Contact Greg Hugh Shenzhen to Changchun and from Wuhan * 115 square kilometers – double that of 952-472-4757 to Kashgar, via Chongqing, buildings have Manhattan Island [email protected] been going up, rather like mushrooms after * 60 new office skyscrapers a rain storm, as signs of the new prosperity * 280 meter hotel and office tower, higher and growth of China. than the tallest building in Britain Consul General In fact, every single Chinese city, large * Cost: RMB115 billion (US$16.94 billion) and small, seems to have acres of new devel- continued from Page 1 opments – but all lying empty. The giveaway Zhengdong New Area Residential One topic that was of mutual inter- is a quick evening tour of residential and est to the group was the desire to have business blocks. If no lights are on, why Property * 300,000 homes built visa officers come to the Twin Cities to were they built? Entire development zones handle Chinese passport renewals as was 100 square meter house purchase price – North American Translations with no businesses. Blocks upon blocks of arranged by CAAM several years ago. high rise apartments for tens of thousands of RMB500,000 to RMB1 million (US$74,000 Your one-stop source for pre- – US$147,000) Consul General Yang said he would look families – all unused, empty shells instead of into accommodating the wish for such a cise technical translations be- the dream homes the advertising hoardings * Minimum wage in Zhengzhou: RMB9,600 per annum (US$1,411) service and after the meeting, indicated tween Chinese and English. proclaim they are. to Vincent Mar that this could take place Local governments and real estate * Time required to save entire salary and We specialize in legal, financial, buy property: 104 years as soon as October, 2010. engineering and medical trans- developers have been working together to At a separate meeting during this “improve the value of the land,” and reap The race to develop as the preeminent lation work. central China hub is on it seems. Similar trip, Consul General Yang also met with income and gain growth credits for doing the Board of Directors of U.S.-China so, but how is the land improved if no-one projects are underway in the other five central China cities, and the situation is re- Peoples Friendship Association-Min- Our high-quality serice is com- is using it? In fact, land in which money has nesota Chapter. During this meeting been spent to build a block of high-rises may peated, over and over again in other second petitively priced. Contact us and third tier city groupings, all looking to Board Member Linda Mealey-Lohmann today to get your free quote. show an increase in value on paper, but until introduced Consul General Yang to two those units are sold or rented out they have become their respective regional center. Most of the development is funding by proposed Chinese garden projects in- Phone: 612-799-5415 been erected at a loss. Value of land is a key volving resources from the Minneapolis- indicator in China’s GDP growth figures, yet government borrowing. The vast major- ity of these will become white elephants, Harbin and Changsha-St. Paul sister Fax: 612-643-3498 if no one is utilizing it, obviously those fig- relationships. Email: ures are wrong. Traveling from the airport to unused, expensive to maintain, while the construction debt will have to come back Consul General Yang was born [email protected] downtown Chongqing for example, there are in Shanghai in 1954 where he received masses of expensive, premium apartments and be counted at some point. One wonders also about the transparency of the funding. most of his education and spent most and villas for sale. Chongqing’s minimum of his career in various business and wage level is US$1,221 per annum. But Collusion between local government and local real estate developers is rumored to government positions except from Accounting Institute and W. P. Carey priced at US$1 million each, who is going to 1992-1996 when he lived in Los An- Business School of ASU, with an MBA buy them? Adding value to land only works be rife. The developers buy the land and build while the government pockets the cash geles while he represented several degree. if you have a market for the property, oth- state-owned businesses. He attended Addition information about The erwise the valuation is just a paper exercise and can point to a job completed; yet the funds come from state and not local coffers. EMBA China-Euro International Busi- Consulate General of the P.R. China in representing no real financial asset or gain. ness School from 2002-2004 and earned Chicago can be found at The central China cities of Changsha, With state-backed loans estimated at some RMB11.4 trillion (US$1.68 trillion) for the an MBA degree and from 2005-2008 www.chinaconsulatechicago.org/eng/ Hefei, Nanchang, Taiyuan, Wuhan, and attended EMBA, Shanghai National Zhengzhou for example, are all part of provision of such loans, it’s the scale of the the governments “Go Inland” campaign – issue in China that causes serious concern. China may be getting too big for even the Top photo: Vincent Mar (l) and Consul General Yang (2nd l) interacting with members encompassing these cities specifically to of the community. encourage foreign investment and to jointly central government to afford, and with real promote them as alternatives to the country’s national GDP growth rates (once property influences have been stripped out) of about Bottom photo: Consul General Yang (back row, center) with USCPFA-MN Chapter coastal cities. Yet what has happened is that Board Members these cities have taken this mandate to ac- 4 percent to 5 percent per annum, that may tively compete – not just in growth figures not be enough to keep China completely on to make their GDP look good, but also with the projected growth track until that debt each other. Accordingly, we have situations can be absorbed. like those occurring in Zhengzhou, an inland While China looks a great investment city of five million. It’s a typical Chinese play, and the developments look amazing, city, reasonably modern, yet somewhat quiet it is also time to be cautious and choosy and unassuming. FDI is present, but the about the extent of corporate investment logistic costs of manufacturing in Zheng- exposure to China, especially in real estate. zhou and then shipping globally render it For business looking at inland locations unsuitable for most international exports. for regional development and expansion, For Chinese domestic sales, Zhengzhou is great care needs to be taken and proper op- in a great location, but it will always remain erational due diligence conducted over the a relatively small player when it comes to inherent logistics and transportation links. pan-Asian or global trade. The geographical Geographical suitability, strategic locations positioning of the city dictates this. How- and access to markets both real and prom- ever, the city government has built Asia’s ised need now, more than ever, to be taken largest exhibition and conference site there, into consideration. and the statistics are impressive: Chris Devonshire-Ellis is the principal and founding partner of Dezan Shira & Associates. The firm has 18 years of foreign Zhengzhou’s New Exhibition and investment experience throughout China Conference Center and maintains 10 offices in the country. * 69 hectares – twice the size of Vatican City For assistance and advice over foreign * 34,000 square meters – five times the size investment laws, taxes and incentives and of Old Trafford, the home of Manchester conditions throughout China please contact United the firm at [email protected].  * Cost: RMB2.2 billion (US$324 million) Zhengzhou is not content with that. It’s Reprinted by permission of China building an entirely new city – the Zheng- Briefing. (http://www.china-briefing.com) PAGE 4 > SEPTEMBER 2010 arts www.chinainsight.info Master Lei’s happy reunion with his artist friends in St. Paul By Mike Xiong, Staff Writer t was over fours years before Master Lei famous poems. Master Zhu Xunde, Dean Yixin, commissioned artist for Martin of Art Institute of Hunan Normal Univer- ILuther King Jr. sculpture to be installed sity. He is skillful in Chinese painting with at the National Mall of Washington, DC, the theme of tranquility and world peace. was able to meet, hug and toast with his Master Hu Liwei, Vice President of Hunan artist friends again in the newly remodeled Art Institute, Chinese painting painter fo- Tea House restaurant during the welcome cusing on the harmony between people and dinner hosted by Public Art St. Paul on July natural environment. Master Cao Mingqiu, 18, 2010. National first class artist specializing in both Four years ago, Lei left St. Paul with painting with mixed Western and Chinese a stunning sculpture “Meditation” and a techniques and modern fashion design with strong candidacy for the commission to Chinese traditional artistic patterns. sculpt the likeness of Martin Luther King, Jr. All those artists have gained national During these four years, many things reputation in their own artistic fields. happened. Prominently, Lei’s candidacy Master Lei displayed his new creation: provoked serious criticism from some of Two sculpture replicas 1) General Chen- American artists who, although they did nault 2) Chiang Kai-shek and Mao Zedong not argue much about Lei’s artistic skills, in the pose of toasting. General Chennault wanted to deny his qualification by citing led the Flying Tiger to fight the Japanese more racial and political reasons. The selec- invaders during the Second World War. He tion committee of the Martin Luther King, built an ammunition freight airport in west- Master Lei Yixin with his fans in front the sculpture “Meditation” on July 18, 2010 at Jr. National Memorial Project, on the other ern Hunan province during the war years. Phalen Lake, St. Paul hand, insisted the decision of choosing Lei Mao, a Hunan native, and Chiang were Kimball of CVA and many others. They all art exhibition would proceed smoothly and was solely based on artistic criteria. The archenemies. Their toasting happened at the volunteered time and efforts to work col- successfully.  negative voices gradually faded. Lei moved dawn of China’s last Civil war. Lei might laboratively so that Master Lei’s visit and on with the confirmation as the commis- want to remind people that even between sioned sculptor and executed the sculpture archenemies, there exists a moment of har- project in China. Right now DC’s National mony. If people can grasp that harmonious Mall is getting ready for the installation. moment, war might be avoidable. Besides More foreign films are in the offing? Another thing is an incident that hap- the replicas, Lei also displayed the printed pened to Lei’s sculpture “Meditation” dis- images of woodcut of Hunan’s famous art- By Liu Wei, China Daily played in St. Paul’s Phalen Lake. Two years ists in recent history. Opening the Chinese movie market will them with another local company, Huaxia. ago, some local gangs and racists defaced The art exhibition and visit was spon- benefit both China and the United States, a The country’s box office revenue con- the sculpture with hate symbols and racial sored by four organizations: St. Paul May- top U.S. film industry leader says. tinues to soar this year, grossing 4.2 billion slurs. Local police, artists groups and the or’s Office, College of Visual Art, Public Art Robert Pisano, president of the Mo- yuan (US$615 million) in the first five Chinese community who loved the sculpture St. Paul and US-Chinese People Friendship tion Picture Association of America, told months. But nearly one fourth of it is at- worked together and removed the dirty Association (USCPFA)-Minnesota. China Daily that discussions are ongoing tributed to James Cameron’s Avatar, which marks. They eventually totally recovered July 18 was a day that impressed Lei and between the Chinese and U.S. government earned more than 1.2 billion yuan. to the statue’s original beauty. his delegation. This day was packed with on whether to further expand the fastest As to the gap between local productions During these four years, Lei’s reputation activities from the morning to the night. The growing film market in the world. and Hollywood blockbusters, Pisano insists in China and the world has risen as people first trip was to the site of “Meditation” in The World Trade Organization rejected on the importance of letting the market start to realize the significance and influence Phalen Lake. Christine Podas-Larson, Chair China’s appeal last December and upheld decide. of the sculpture that will become a must see of Public Art St. Paul, met the delegation at an earlier decision to break China’s State “Avatar was a unique phenomenon,” spot in DC by visitor from all over the world. the site and guided the tour for the delega- control of the distribution of imported he says. “I don’t hold Avatar as the stan- The happy endings to those major events tion to St. Paul’s scenic spots. The lunch films, books and other copyrighted cultural dard against which all other films should deserve much toasting and cheering and was hosted by Mary Warpeha, co-chair of materials. be measured. Good stories compete in the that was exactly what had happened during USCPFA-Minnesota. Then there was af- The Ministry of Commerce said in its marketplace. the dinner. ternoon reception at the CVA gallery. With defense that it had made foreign entry into “In a competitive market, well-done Prior to Master Lei and his delegation’s honor and privilege, I introduced each del- China’s publication, film, and audio- and Chinese films will compete head-to-head visit, there had been an art exhibition en- egate at the beginning of a brief reception. video-products markets very smooth, and with well-done Hollywood, French and UK titled “Harmonious Hunan” at the gallery St. Paul Mayor Chris Coleman, CVA presi- that cultural products should be treated dif- films. The key to success is to tell the stories of the College of Visual Art (CVA) in St. dent Ann Ledy, USCPFA Mary Warpeha and ferently from other goods. people want to see.” Paul. More than a dozen of Hunan’s art- Public St. Paul’s Christine Podas-Larson China has one year to comply with the Restrictions and quotas, he says, have ists in painting, sculpture, calligraphy and each made a welcome speech to the delega- ruling, which can no longer be appealed. proved unsuccessful worldwide. photography displayed their award winning tion. Artistic gifts brought from China were Pisano says he has not observed any “There is a history of government seek- works for more than a week. presented to the sponsoring organization by specific implementation of the ruling so far, ing to put restrictions on the importation However, restriction of visa granting al- the delegation. Calligrapher He Manzong but points to on-going discussions, adding of movies or to implement screen quotas,” lowed only 4 artists to visit the Twin Cities donated 8 scrolls of Tang Poems in cursive that he hopes for the best. he says. besides Master Lei. Master He Manzong, script to CVA at the reception. St. Paul “It is not a win-lose situation,” he says. “What we find around the world is that it President, Calligraphy Association of Hunan Mayor Coleman also sent gifts to the artists. “As more non-Chinese films enter the is the consumers who decide which movies Province, specializes in Tang Dynasty’s Dinner was followed immediately after market, people have greater choice, which are going to be successful. the reception in the evening hours. All makes the pie bigger and movie-going habits “You cannot force someone to go watch local sculptors who participated into the increase. That helps all participants of the a movie they don’t want to watch. Today in International Sculpture Symposium in 2006 industry including local filmmakers.” a connected wired world, it is even more were invited for a reunion with Lei. Songs, China’s box office has seen annual difficult to tell someone we only want you music and dance went on with toasting and growth of more than 20 percent since 2002. to watch the movies we produce.”  cheering at the dinner. But the country allows only 20 foreign films After the delegation returned back to to be released in theaters every year. Only Reprinted by permission of China Daily China, Lei wrote an e-mail message to me: the State-owned China Film Group is enti- www.chinadaily.com.cn. “The day in St. Paul was very busy but so tled to import foreign films. It co-distributes impressive that every delegate will remem- ber for life. That is the best day during the whole trip to America.” Hunan Artist Delegation Leader Mr. Jiang Advertisers Many people made valuable contribu- Your potential customers are reading ChinaInsight. Shouldn’t you be Heping left, and Master calligrapher He tions to the success of this art exhibition bringing them in the door with an ad? Manzong right with Mike Xiong center in and visit. Among them are Li Ning of the gallery of College of Visual Art at the Seagate, Christine Podas-Larson of Public Contact: Greg Hugh reception on July 18, 2010 Art St. Paul, Demeri Mullikin and Rosemary (952) 472-4757 www.chinainsight.info sports SEPTEMBER 2010 > PAGE 5 PAGE 6 > SEPTEMBER 2010 education www.chinainsight.info Students from Loudi China attend summer cultural camp in Minnesota By Greg Hugh, Staff Writer

Group from Loudi at the Minneapolis-St. Paul airport The long flight originating in Shanghai nesota. Part of the day was devoted to an to Minneapolis-St. Paul didn’t dampen the English Seminar and a discussion on history spirits of nine students along with a Vice and faith of America. The students also had Principal and two teachers from Loudi No. a chance to visit downtown Minneapolis and 1 Middle School as they were enthusiasti- the Minneapolis Institute of Art. cally greeted at the airport by a welcoming There were no activities scheduled committee lead by their host families. for the weekend so that they could spend The group was here to attend a Summer it with their host families and experience Cultural Camp in Minnesota so that they exactly what an American family does on could experience a bit of American culture a weekend. and learn more about how America works, A farewell dinner and celebration was plays, learns and basically lives. held on Sunday at Grand City Buffet in St. Their week here was filled with tours of Louis Park, MN, which was also attended the University of Minnesota, shopping at the by several students and teachers that had just Mall of America, a visit to St. Cloud State returned from a visit to China including a University and a stop at the Outlet Mall in visit to Loudi. Certificates of Achievement Albertville. The students also toured Eden were presented to the students by Richard Prairie High School which has established a He, President of China Insight and Janet sister school relationship with their school. Pladson, Ed.D., Director of Teaching and They also attended classes on broadcast and Learning for Eden Prairie School District. other media that were held by Asia Media Certificates of Appreciation and a token Access (AMA) an organization that had just gift from the students were presented to the Loudi Student Interviews had a group of students that returned from a host families. Loudi student: Li Yang “They become like my real family,” says visit to China. AMA also spent a day with The students from Loudi then continued Interviewer: Fartun Abukar Betty. Betty and the group went to Mall Of the Loudi students on Lake Calhoun with their visit of the U.S. by flying east where swimming, canoeing plus a BBQ lunch. they visited Boston, New York, Philadel- Li Yang was born in May 24, 1994. America, the University Of Minnesota and Another day was spent at the Hospital- phia and Washington, D.C. before they She is 16 years old. Her American name some Middle schools. Betty learned English ity Center for Chinese which is an outreach returned to China. is Betty. She is the only child in her family when she was in Elementary school. She  organization that primarily serves students Editor’s Note: See below for interviews and she feels special about that because studied English when she was 3rd grade. from China attending the University of Min- of the Loudi students by AMA students. her parents can put their full love on her. “But this generation learns English earlier,” Sometimes she feels like she needs a brother says Betty. She studies from Monday to Sat- but Li Yang says, “it’s ok”. She has been in urday, morning to evening. On Sunday she the United States for three days only. Her spends most of the time doing homework, school gave her and other Chinese students sometimes shopping or playing sports. She Teaching in China, One Perspective the opportunity to come to America. It is likes to play tennis. By Loretta Minet, Asian Media Access an Educational Exchange. They are going When there is a celebration or holiday to be in the United States for only 15 days. all the families gather and have a big family Asian Media Access had the opportunity in the evening. It is hard to image American After that they will go back to China. After dinner. After they are done with the dinner, to visit and get to know nine students visit- students keeping such long hours. When nine days in Minnesota, they are going to they light fireworks with their grandparents. ing from Hunan China and three teachers. asked about her thoughts of Eden Prairie New York, Washington and Boston. They They celebrate for seven days. Girls stay AMA youth sat down with the students to High School, Ms. Chang thought the school are nine students and three teachers. home with their family on the first three find out about the youths lives in China and was beautiful with lots of computers. She When asked what the difference between days. The other days they can hang out the students got to learn a little bit about said that many Chinese students would like China and America is, Betty said, “China with friends and hold a party. Betty climbed being a teen in America. Despite some to come to America to study because they has 5,000 years of cultural history”. The the Great Wall before but her mom didn’t language barriers, everyone was able to would not have to work so hard. Study is Beijing Opera has kind of a song that ex- because she got scared. In China they have communicate with each other. difficult in China with an emphasis on math, plains China’s history. China is becoming something called QQ.com and MSN. It’s I had a chance to sit down with Liu physics and chemistry. Students in the U.S. an international country. America has less like Facebook. You can chat with anyone Chang (Angel) who is an English teacher are much more physically active than in history than China. America developed very around the whole world. at the High School. This is the group’s China. The students in Chine get one half quickly. America is open, the environmental first trip to America. They are part of an hour after class each day for sports or other is great, it’s better than China. The weather Loudi student: Grace Educational Exchange, visiting their sister physical activity. is cool especially at 6:00pm. Betty goes to Interviewer: Paly Yang school, Eden Prairie High School. Their Mr. Cai Xiang Rong, the Vice Principal High School. Her school starts at 7:00am Grace, one of many students at her school in Hunan is ranked number one in of the school and physics teacher also visited to 6:00 p.m., after 6:00 p.m. she goes to school in China got the chance to come to the province and is very competitive. The with us. There are approximately 5,000 evening school and she does her homework. the U.S. She was born in Hunan, Loudi teachers and students work very hard with a students in their school and 300 teachers. I In China everything is about learning, prac- China in the year of 1994. Being the only day that begins at 7:30 a.m. every morning asked him if it was difficult to manage such ticing and studying. When Betty grows up, child in her family she gets a little free and they have classes until noon, when they as large school. He said the students are she wants to be a lawyer. Her parents want time to hang out with her cousin. Often go home for lunch. The students return to very diligent. They do not have discipline her to be a teacher or a doctor but she doesn’t she feels very lonely not having siblings. school at 3:00 p.m. – 6:00 p.m., when they problems or problems with drugs or gangs. want that. Betty is planning to attend col- But the rest of her time is spent studying go home for dinner. But their day does not To go to their school, the students must pass lege in Europe or America. and going to school. She says she wants to end there. The students return to school at an entrance examination, so they get some Betty said people in America welcomed be a doctor when she grows older. So she 7:30 p.m. for “study time” until 10:00 p.m. of the best students in their school. her very well. People in America are studies very hard to succeed and get into a open, friendly and happy to talk to them. The family that hosted her are very nice. Loudi Student continues on Page 15 Editor’s Note: Read all of the Loudi student interviews online at www.chinainsight.info www.chinainsight.info SEPTEMBER 2010 > PAGE 7 PAGE 8 > SEPTEMBER 2010 arts www.chinainsight.info Delicate balance is shown in ‘China in Transition’ Local artist Priscilla Briggs showcases work in St. Paul By Anthony James, Staff Writer arrow hallways of the were ing cultures. As one of the fastest growing packed on a sweltering Friday economies, the ever-changing sociological Nevening in the IFP headquarters, landscape can be seen as a direct result of a local non-profit that supports local artists. the economic blurring of communism and On one of the painted white walls hung a capitalism in modern day China. photo of a brassiere billboard within one Briggs, who also holds an associate pro- of China’s largest factory district. While fessor position with Gustavus Adolfus Col- the juxtaposition and tone of the ad signify lege in St. Peter, was able to travel to many modernity and life, the streets below it were areas of China including Guangzhou, Shan- stained with shoddy shantytowns along a tou, and Hong Kong to observe and draw trash-ridden highway. compelling questions within the dynamic business structures. Priscilla noted these characteristics, “My ob- servation is that Chinese culture and business is only consistent in its inconsistency. The rules change depending on where you are, who you are, and who you are dealing with.” That could be said “My observation is that Chinese culture and business is only most any of country consistent in its inconsistency.” with as much diverse -Priscilla Briggs ethnicities and cultures For the photo’s creator, local Minnesota as China does, but what makes her case portunities for fast growth, but not without expectations and ideas of what is possible. artist Priscilla Briggs, the work is significant compelling is the rise of commercialism that its side effects: “A lack of manufacturing I think Chinese culture will be very affected in reflecting the unique balance that plagues overshadows the rich traditions that were regulations has created areas, such as the one by the one-child policy in that it will soon China’s rampant industrialization. “China in prevalent within the many communities. in Shantou that I photographed, of extreme be a country full of only children (who Transition”, which is a exhibit of both recent One of Briggs’ photos stood out for many pollution and living conditions.” have a tendency to think they are the most Briggs’ photographs and the photographs of of the viewers, a dirty waterway plugged by This is not new territory for Priscilla, as important person in the room) and men. Dan Dennehy, purposely drives to show a piling amounts of garbage. Priscilla agreed her work mainly deals with building self- The ramifications of these conditions have delicate equilibrium of the old and emerg- that with unfettered dealings there are op- consciousness of how economic systems yet to be seen.” shape the everyday life. In a previous work For the economic growth in China, entitled “Global Market”, Priscilla took there are two sides to that coin. Priscilla photographs from the Mall of America, hopes viewers walk away for her work re- Thailand, and Cuba in hopes of resonating minded that “urban China is very modern the connection between “cultural identity, and industrialized China is very polluted… the nature of merchandise for sale, and the country is very complex and also that advertising images.” How China fits into Capitalism and Western materialism have become integrated into Chinese culture and made their own.” For China, the future holds no implications of the consequences of such cultural affliction and financial opportunity. “China in Transition” is currently exhib- ited in the IFP Minnesota Center until Sept. 24, 2010 at 2446 University Ave. West, Suite 100, St. Paul, MN. (IFP will be closed on Labor Day, Sept. 6). Visit www.ifpmsp.org for more information about IFP Minnesota. Priscilla Briggs’s Web site can be viewed at that picture is quite an easy task. Many re- www.priscillabriggs.com.  searchers of economic systems would agree that if there were one place in the world All photos by Priscilla Briggs that stood as the epitome of consumption and growing consumerism in the current geographic economic structure, the PRC would most certainly make the list. This change might be frightening to some that realize that since the major remodeling of China’s economic infrastructure the world’s oldest anthropological artifact could be inadvertently lost forever. For Briggs, as with many others who have traveled to China, the extremes are not only in an economic context, but also in a social one: “I personally experienced extremes in hospitality. Many people went far out of their way to assist me when I needed help, but I was also robbed in the middle of a busy street and no one lifted a finger to help me.” Two sides were often found within generational gaps: “there is definitely a huge gap between the morals and values of younger and older generations as well as www.chinainsight.info community SEPTEMBER 2010 > PAGE 9 Ming Li Tchou & Pearl Bergad: Bridging China and Minnesota The road to Minneapolis for Ming Li Tchou and Pearl Lam Bergad took various unexpected detours. By Saje Mathieu way to the United States, coming to Min- sight of how immigration could also be an Pearl is most proud of how their work and nesota for undergraduate studies at Carleton isolating experience for some others. generosity introduces students to Chinese College. When she began classes, Pearl Service has always been central to both heritage and creates opportunities for young embraced the wonderful gift of college Pearl’s and Ming’s lives. While neither Chinese scholars starting their careers at the seemingly unaware that as a young Chinese could quite remember how they first became University of Minnesota. woman and a budding scientist, her place friends, they both emphasized that their And while Pearl and Ming share their en- at Carleton challenged assumptions about commitment to giving back solidified their thusiasm with young Chinese Minnesotans, her belonging on three fronts. But there, in bond. Early on, the two women, who share they are also very mindful of another com- country she still recalls as being “astonish- an easy, sisterly rapport apparent to anyone munity in need of their care: aging Chinese ingly flat,” Pearl welcomed what college fortunate to know them, made it a point in Minnesota. Pearl and Ming are longstand- L to R: Dean Jim Parente, Ming Li Tchou life—and Minnesota writ large—had to of wedding their philanthropy with their ing charter members of the Chinese Senior and Pearl Bergad offer. passion for Chinese culture. That vision Citizens Society, Ming having served as the I had the pleasure of meeting Pearl and brought the lifelong friends closer together association’s president for 10 years, and they Ming over lunch one beautiful fall after- understand older Chinese Americans’ par- orn in Guangzhou, China, noon. Between sips of soup and bites of ticular cultural needs. The women explained Ming recalls how she learned salad, the two ladies told of their experiences how Chinese elders, some of whom may her grit from her mother who B in Minneapolis, a city where few Chinese not speak English, are experiencing a new encouraged her daughter to explore the could be found during the 1960s. When form of isolation in their advancing years. world and ask bold questions along the way. asked about those early days, Pearl broke With them passes important memories of Ming hails from a family of prestigious at- into her infectiously warm smile and said, life in mid-century Minnesota, tales of their torneys and accomplished scholars of arts “I mean it was all corn. And they fed it to travails as migrants from distant shores and and letters. World War Two interrupted animals!” In China, that corn might have stories of their successes, sometimes in the Ming’s plan to study law and set her on a been much needed sustenance for people. face of tremendous adversity. Pearl and path that eventually landed her in the Twin Minnesota’s abundant landscape quickly Ming’s Chinese Heritage Foundation works Cities. After meeting Dr. Mien Fa (James) Pearl Bergad (left) and Ming Li Tchou imprinted itself on Pearl’s heart and became for these men and women too and encour- Tchou, whom she wed in 1946, Ming lived her new home. and paved the way for the Chinese Heritage ages University of Minnesota students to in Shanghai, Vietnam; Paris; Ohio; and in Pearl forged the first of many new fami- Foundation, created in 2004 in honor of Dr. connect with the wealth of resources in East Texas before eventually coming to lies at Carleton with young women from Tchou, Ming’s husband of 25 years. Pearl Chinese communities across Minnesota. Minnesota in 1961. While Dr. Tchou began New Jersey, Utah, and other parts of North best captured the Foundation’s philosophy: This marriage of old-timer and newcomer, a residency in anesthesiology at the Univer- America who, like her, were setting off on “We are not big. Our aim is not to be big but young and old, is Ming Li Tchou’s and Pearl sity of Minnesota, Ming launched her career their own. After completing her undergradu- rather to do what we can do at its best.” That Bergad’s gift back to the University of Min- as a medical technologist. An entrepreneur ate work, Pearl completed her Master’s of best has included providing an endowed nesota and to the state that so generously and scholar, Ming spent many years sharing Biology at the University of Minnesota, fellowship for Department of History gradu- welcomed them decades ago.  her love of China with Minnesotans, as a where she then enjoyed a successful 25 ate students working on 20th century East Editor’s note: This article appeared in store owner, tour operator, restaurateur, and year career as a molecular biologist at the Asia, with a particular focus on China. The “Bridging Past and Present: History at the through her work with organizations like the U’s Medical School. And while Pearl and Chinese Heritage Foundation’s stated mis- University of Minnesota”, Department of U.S. China People Friendship Association. Ming each report having felt the touch of sion is also to inspire a passion for Chinese History Newsletter, Winter 2010 issue; and Born in Hanoi, Vietnam and raised in Minnesotans’ generosity, they never lost art, culture, literature, music, and history. it is reprinted by permission of the author. Hong Kong, Pearl Bergad also found her Jane Wilson, Honorary Chinese Minnesotan of Note By the Advisory Committee of the Chinese Heritage Foundation, with Sherri Gebert-Fuller of the Minnesota Historical Society or many years following World got involved and organized a Chinese became for these and subsequent families, She is effusive in her praise as yet another War II, Jane Wilson was the super- Sunday School for them and their children. in addition to a place where they could learn child becomes a physician, an attorney, or an Fintendent of the Chinese Sunday The School met on Sunday afternoons after English, an anchor and important social ha- engineer. And these families have responded School at Westminster Presbyterian Church the morning church service. In addition to ven where they could meet each other in an to her devotion in kind. She is invited to all in downtown Minneapolis. regular Sunday School teachings, the teach- accepting environment and share common family celebrations, graduations, weddings, Westminster had a long history of in- ers taught English and other social skills. concerns. It was essentially the only support birthdays, and traditional holidays and so on. volvement with Chinese immigrants in the Soon it became a tradition for subsequent system they had. Her proudest possessions are the numerous Twin Cities. Dating back to 1882 when the Chinese immigrants to send their families photo albums, all carefully dated and anno- first Chinese men started arriving in Min- to the Westminster Chinese Sunday School. tated, that document these family passages. nesota, the men of the Westminster con- When Wilson joined Westminster In addition to attending these family gregation had responded promptly to their Church in 1946 she heard about its Chinese events, Wilson has been an astute observer needs: help in language and business skills. Sunday School. Never having met a Chinese of the feelings of different family members During the 1920s as a few Chinese women person before in her life, she signed on to at different times. She shares their ups and began to arrive, the women at Westminster be one of its volunteer teachers. downs and goes about offering support and In 1947 a dozen or more Chinese war seeking solutions, all the while remaining brides, mostly from Guangdong Province, unobtrusive and without fanfare. Over time arrived. Merely teenagers, they had been these long-standing concerns for individual married to Chinese U.S. veterans by their members have deepened her relationships families. They spoke no English and knew Jane Wilson (center) with several of the with the entire families. no one in town. Wilson was one of the teach- early war-brides and their daughers at a The Chinese Heritage Foundation hon- ers who greeted them at Sunday School and recent luncheon ors Jane Wilson for her openhearted com- her heart went out to them. With no common passion for the Chinese immigrants in need, language between them she and other teach- After the Sunday School closed in the her abiding faith in the resiliency of the im- ers proceeded to teach these brides, on a one 1960s, Wilson, or 珍姑 (zhēngū, Chinese migrant spirit, and for bestowing the bless- on one basis, practical language skills such for ‘Aunt Jane’), as she was, and still is, ings of the Chinese ideal of a kind, loving as counting money, getting around on street- affectionately addressed, kept up her friend- and caring mother, 慈母 (címǔ), on so many Jane Wilson (2nd Row, 1st left) attending cars, or answering simple questions about ships with all her Chinese families. In the who are not her kin. For more than 50 years, a Chinese Sunday School with Chinese their names and addresses, or whatever ensuing 40 years, she wrote many letters she has been a trusted advisor and confidant wives of Chinese-American servicemen after situation, such as an illness, that arose. This for their immigration problems and tracked to numerous Chinese immigrants and their World War II at Westminster Presbyterian was teaching English as a Second Language their growing families meticulously, giving families. Her unwavering optimism in their Church, Minneapolis. at its best and gut level, before it became an English names to the newborns and follow- potentials has contributed greatly to their Photo by Bing Wong courtesy of Minnesota academic discipline. Things got lively when ing each child’s path through schools and becoming constructive members of the Historical Society. babies began to arrive. The School soon professional careers with glowing pride. Minnesota community at large.  PAGE 10 > SEPTEMBER 2010 culture www.chinainsight.info Chameleon: How Chinese food has The making of a Mother Tiger adapted to its surroundings By Sophie Liu-Othmer It was dark with only a few distant stars Now I am an adult with a happy family. No worldwide in the sky. Shadows of mountains protruded worries about food and shelter. Did I keep Peruvian chifas into the sky like menacing ghosts. My fa- my promise? ther was pulling our wooden cart. I could I see images of misery from China dis- By Elizabeth Greenberg, Staff Writer hear my father’s breath in front and his feet played, reported, and portrayed in American stumping through the mud. The wooden media. They are chosen to deliver a message Welcome back! Last month I gave you axle on the two wheels made a sharp squeak, of suffering, and are used to draw sympathy a taste of the ways that Chinese cuisine like an excited mouse. and charity. Are there other purposes? To could change worldwide and told you about Mommy murmured from under thick contrast that misery with American comfort, India’s Chicken Manchurian and date pan- covers, “Darling, move closer to me.” so Americans will feel lucky that they are cakes: this week I hope you’ll take an extra I was wrapped in a black cotton coat. I not one of those unfortunates? helping of information about Peru’s chifas. sat at the head of the cart to block wind for For me, those images are representa- In 1850, the first Chinese immigrants Mommy. She had just given birth to my tions of my parents as I witnessed on that came to Peru from Macau to work at younger brother. stark night. They delivered a different sugar plantations, followed soon after by Dou Dou (Struggle Struggle) was message to me. Suffering? Yes. But there immigrants from Guangdong Province. As born on January 4, 1969 in the Shan Xi is no self loathing and no plea for help. In in the United States, the new immigrants (Mountain West) province of China. Our addition, there are also sublimity, courage, proceeded to open up restaurants and laun- A sample of dim sum at El Restaurante great leader Chairman Mao had decided to and humility. That night instilled in me a dries. Peru now boasts the largest Chinese Royal. start a political movement called Cultural profound respect and love for my parents population in South America and is famous and sour sauce with vegetables, meat, and Revolution two years before. During the and millions of others like them. I don’t for its Chinese cuisine. Peruvian Chinese pineapple or peach slices) the ever-present first stage of this movement, the goal was to think the American media is conscious of restaurants, or chifas, are ubiquitous in chaufa, a soy-drenched fried rice whose remove power from any bourgeois leaders the full implications of these images when the country-- one writer describes seeing a name comes from the Chinese for “fried in the country. The national slogans were they decided to use them. A respect for those chifa about once a block. The word chifa rice” (we in the States use this corruption “Suspect Everything,” “Down with all of people is often missing and ignored. derives from the Chinese word for ‘to eat,’ too-- “chow mein” comes from the Chinese them,” and “Civil War,” to turn a “bourgeois My younger brother is the fifth and the 吃饭 , or chīfàn. word for fried noodles), and the charmingly dictatorship to proletarian dictatorship.” All last of our siblings. He is now an accom- named Aeropuerto, or Airport, made of was to ensure that China not move toward plished film maker. He has made five films, noodles and rice. capitalism. all winning some sort of award, with one There was chaos in the local Teachers winning both the Best Director and Best film Influence Training School where Mommy and my in the Tribeca Film Festival. His most recent Peruvian Chinese cuisine is so famous father worked. No one knew who would be film was a finalist for the 2009 Cannes Film throughout Latin America that it has been accused as an antirevolutionary the next day. Festival. Mommy died at an early age of 56. exported to several other countries, in- The revolutionary who was in charge today Perhaps she can rest in peace now, knowing cluding Ecuador, Argentina, and Chile. could be a leader of the bourgeois class the her hardship that night had not been wasted. However, typical Chinese cuisine in those next day and deserved to be “trampled on On August 15, 1987, I came to the U.S. countries is slightly different from that. by a thousand feet.” on a student visa. Now I am 45 and hold One of the most popular Chinese dishes in Mommy lay on the cart in a pool of an American passport. Being a Chinese im- Buffet at El Restaurante Royal in Lima, Peru Ecuador, for example, is chaulafan, which sweat and old blood under a pile of damp migrant has been a bittersweet experience. as the name might suggest is another version quilts. Cold wind buffeted my face. Car- A Chinese would describe the feeling as Authentic Chinese cuisine can be found of fried rice. However, this dish is heavier casses of harvested corn stacks sporadi- having tipped over a five spice (sour, sweet, in the Chinatown in Lima, Peru. However, on the meat and is spiced with burnt sugar. cally covered the fields on both sides of the bitter, hot, numb) bottle. Among the mixture like virtually all Chinese cuisine worldwide, In Argentina, Chinese supermarkets can be narrow dirt road. For some reason I knew of emotions, one stands out as betrayal, most Chinese cuisine in Peru has adapted found every other block, but restaurants are I needed to be very obedient that night. I and subsequently anger. It was detected to local flavors and ingredients. Peruvian comparatively rare. was only four, but I could tell something during our dinner conversations with my Chinese food shares some staple ingredients out of the norm had happened. I had seen American husband and two children over such as soy sauce, garlic, ginger, and scal- Best Restaurant Worldwide? pigs slaughtered for The Chinese New Year; issues involving China and Sino-American lions (in Spanish called cebollita china, or bellies cut open, insides yanked out. I now relationship. I often feel very protective of “little Chinese onion.”) The similarities end The most famous chifa in Peru is El Restaurante Royal in Lima, where, accord- recognize that same steamy bloody odor. A China. So much that I could be described there, though. In fact, American blogger protective instinct rose in me. I made sure as a mother tiger. Fiercely defensive, hair Tom Pellman wrote, “...the food at most ing to Jennifer Lee of The Fortune Cookie Chronicles fame, “you can rub shoulders the quilts were shut tight, so wind would not standing up, teeth showing, claws shining chifas tastes more similar to Chinese res- get to Mommy, who was so dependent on with sharpened nails. taurants in the US than in China (i.e. more with Peru’s television personalities and politicians.” The restaurant opened in 1995, me now. My father asked if I was falling I have worked hard to be an American meat, less vegetables, sweeter, less oily, and, asleep. I said no. and I am an American now. But when of course, fortune cookies).” and features high-end dishes such as shark’s fin and pigeon alongsidechifa classics. Like He sighed, and said, “Mommy didn’t people I want to be with have no respect Despite Pellman’s words, chifa dishes plan to have a little brother for you. We for people like my parents, I feel it is such a have a distinctive Peruvian twist: for most chifas in Peru, its desserts are primar- ily Peruvian standbys like tres leches cake. actually went in a few months ago to have an betrayal to my memories of them. It is as if example, many recipes for the popular abortion, but the hospital was out of power.” I had left them out there in the open, vulner- Chicken Chijaukai include a breading made Restaurante Royal also has dim sum and a lunch buffet. Sweat ran down his face and neck. I felt able on the cold and desolate mountain road. of harina de chuños, an indigenous flour like crying. I was scared of this darkness As a Chinese American, I realize I live made from freeze-dried potatoes, or a sauce Hope you’re hungry next month for more, because we’ll be heading to a country around me and Mommy’s helplessness. on a margin in this society. I don’t mind made partly from pisco, a liquor made in My father’s tenderness only intensified my yielding glory and spotlight to the main- Peru. Other popular dishes include Kam Lu whose cuisine is more famous for Weet-Bix than woks: Australia.  fear. We had started out early that day, but stream, but to sell out my parents is not my Wantan (deep-fried thick-wontons in sweet we still had more than 10 miles to go, and plan. Choosing to live in duality requires the road had turned bad. Whoosh, whoosh, reconciliation between my Chinese past and my father’s broken shoes made such a big American present. I have reduced salt and sound in the silent night. Wolves howled at soy sauce in my cooking and increased di- a distance. There were large pot holes on ary in my diet. From walking on a dirt road the dirt road. Ruts from previous carts were in China to driving a SUV in Twin Cities, treacherous. My father had a strap on his Minnesota, then reverse to walking and shoulder to help keep balance. He pulled biking, I changed from an obedient ‘good and pulled. little Chinese girl’ who always respected Rain turned into snow later that night. and believed in authority to a woman whose Flakes floated like flower buds scattered faith is grounded in hard work, knowledge, by a fairy. Very gently and elegantly they and intelligence. The transformation has touched the old dirty cotton warmers on my been arduous, yet enlightening. Strangely feet. My whole body was covered with a enough it is my American present that has thin shell of ice. Icicles drooped from my brought out the Chinese mother tiger inside eyebrows. In the distance, I could see the me. I will always stand by values of that lights of town. night. With integrity, I roar.  Mommy was so weak that night and so helpless. At that moment I swore I’d never cause any pain for my parents, and when The most famous chifa in Peru is El Restaurante Royal in Lima I grew up I would protect them forever. www.chinainsight.info economy SEPTEMBER 2010 > PAGE 11 Exports Bounce Back: Increase of 17 percent in the first quarter exports by around US$158 million. Sales • The only major industry to decrease • Electrical Machinery: Expanded op- to China (including Hong Kong) jumped exports during this period was the mis- portunities in electrical machinery resulted 67 percent to US$395 million, fueled by cellaneous (including medical) products in export gains of 24 percent (up US$103 strong gains in machinery, paper and chemi- industry. These exports dropped mainly million) during this period. The primary cal products. Export gains to Canada were due to decreased demand in Ireland (down driver of growth was integrated circuits driven by strong growth in transportation from US$220 million to US$62 million). products (up 165 percent to US$138 mil- equipment, as well as chemical products. However, sales of these goods performed lion), based mainly on increased demand strongly to China, Japan and Germany. in the Philippines, but also in Canada and Minnesota export trends turned around Taiwan. in the first quarter of 2010, gaining 17 per- • Plastic: Dynamic demand for plastic cent from the same period a year ago – the products – particularly self-adhesive ma- first year-over-year quarterly increase since the third quarter of 2008. The state exported US$3.9 billion in manufactured exports in the first quarter of 2010, representing a gain of US$569 million from the first quarter of 2009. • After China and Canada, Japan, Tai- Minnesota’s exports grew slightly less wan, South Korea, Thailand and the Phil- than U.S. manufactured exports, which ippines contributed the next largest gains gained 20 percent during the same period. in exports. The state’s exporters increased their sales by more than US$50 million in each of these Asian countries. Computers Booming Exports to Asia Jump 75 and electronics, miscellaneous products Percent and chemicals contributed the most to ex- terials (up 122 percent to US$115 million) • The state’s manufactured exports to port growth in Japan, while machinery and – fueled US$115 million in export gains Asia jumped 75 percent (up US$577 mil- transportation equipment contributed the between the first quarters of 2009 and lion) to US$1.3 billion, exceeding U.S. most to growth in Taiwan. 2010. Nine Asian markets accounted for 60 growth to this region of 41 percent. Minne- percent of plastic exports from Minnesota, sota exports to North America increased 20 Exports from Most Major Industries and most grew by more than 100 percent. percent to US$1.2 billion and to the Middle Increase Sharply, Except for Note: Some of these products are found in East gained 22 percent to US$89 million. the paper sector under NAICS. However, exports to other regions fell – Miscellaneous Products • Vehicles: Canada drove much of the • Demand for the state’s computer and particularly the European Union (down Strong Export Growth in Four of Top Five export growth in vehicles, accounting for 17 percent), mainly due to Ireland, where electronics products gained US$139 million US$225 million of these exports.  exports plunged 61 percent. (or 18 percent) – the largest gain among all Industries (in the Harmonized System) industries, largely due to stronger exports • Machinery: Exports of machinery Minnesota Quarterly Export Statistics is the most cur- to the Philippines (up 181 percent to US$81 were valued at US$882 million, up US$87 rent resource available for tracking the state’s manufac- million), Thailand (up 735 percent to US$45 million. The strongest growing product tured export trends and is prepared for the Minnesota segments were office machine/computer- Trade Office (MTO) by the Department of Employment million) and Malaysia (up 157 percent to and Economic Development’s (DEED) Analysis and US$57 million). related parts, sand or liquid dispersing Evaluation Office (Thu-Mai Ho-Kim, 651-259-7180). • Minnesota’s sales of chemical prod- machinery, and centrifuges and filters. Of- Past issues may be viewed on DEED’s Web site at www. ucts also performed well, jumping almost fice machine/computer-related parts were PositivelyMinnesota.com/Data_Publications/Data/ up 120 percent to US$117 million, based Export_Statistics/index.aspx. Exports by state (and by US$100 million to US$264 million fueled North American Industry Classification System indus- by opportunities in Canada (up 63 percent on strong performances in Malaysia and tries (NAICS) are collected by the U.S. Department of to US$64 million), China (up 174 percent Thailand. Sand or liquid dispersing machin- Commerce (USDOC) and are distributed by the World Institute of Social and Economic Research (WISER). • Between the first quarters of 2009 and to US$32 million), Japan (up 96 percent to ery exports were up 18 percent to US$108 million, with particularly strong gains in Other export data based on the Harmonized Tariff 2010, the state’s top two markets had the US$27 million) and South Korea (up 229 System (Schedule B) are collected by the USDOC and largest gains in export value, each increasing percent to US$19 million). Canada and China. distributed by the Global Trade Information Services.

China tops Japan as world’s No. 2 Call for Articles economy Concerned about misconceptions about China? China surpassed Japan as the world’s trast, the export-oriented Japanese economy second-largest economy last quarter, cap- is being adversely impacted by an appreciat- ChinaInsight is a local newspaper fostering U.S.-China cultural and business harmony. ping the nation’s three- decade rise from ing yen. An ageing population is also cause We are interested in publishing articles that engage audiences in America. Potential Communist isolation to emerging super- for concern. [The Economic Times] topics range from understanding daily life in China (or for Chinese in America) to power. The Japanese economy sputtered in the discussions of business markets from both an American or Chinese viewpoint. Japan’s nominal gross domestic product second-quarter, with GDP growing by a for the second quarter totaled US$1.288 tril- measly 0.1 percent quarter-over-quarter - If you have an article on a topic that might be of interest to our readers, please contact lion, less than China’s US$1.337 trillion, the far below expectations -- amidst fears of Greg Hugh at (952) 472-4757 or e-mail [email protected]. Japanese Cabinet Office said [Aug. 16]. Ja- a strengthening yen which is hurting the pan remained bigger in the first half of 2010, key export sector and weakening domestic the government agency said. Japan’s annual demand. [International Business Times] hina nsight GDP is US$5.07 trillion, while China’s is Economic growth in Japan weakened C I is seeking more than US$4.9 trillion. significantly in the last financial quarter, Production Editor China led the world out of last year’s official figures show. Must be passionate about our mission: in addition to being suc- global recession with an economy that’s Between April and June this year gross cess-oriented, self-motivated, resourceful, creative, disciplined and more than 90-times bigger than when leader domestic product - the sum of the nation’s community-minded. Deng Xiaoping ditched hard-line Commu- goods and services - grew by 0.1 percent, nist policies in favor of free-market reforms much lower than expected. Analysts say the in 1978. The country of 1.3 billion people country’s export-led recovery appears to be Responsibilities include layout and design of 10 issues per year will overtake the U.S., where annual GDP is faltering as the value of the yen appreciates. using Adobe InDesign and Photoshop, some proofreadiing, must be about US$14 trillion, as the world’s largest World Bank figures show that in the first Internet savvy. economy by 2027, according to Goldman eight years of this century Japan’s economy Sachs Group Inc. chief economist Jim expanded by just 5 percent while China’s O’Neill. [Bloomberg] grew by 261 percent. [BBC News]  This is a part-time, volunteer position. Bolstered by strong exports and a huge Contact Greg Hugh at 952-472-4757 or population, China has been growing at a Source: World Bank [email protected] staggering pace in recent quarters. In con- PAGE 12 > SEPTEMBER 2010 economy www.chinainsight.info Awash in Cash 0 percent interest. Nonetheless, the Chinese managers, so they always choose centralized output. In addition, the model’s math shows continued from Page 1 save at incredibly high rates; some estimates organization. This makes them less efficient that as resources are reallocated toward put the figure as high as 40 percent of dis- in exploiting their resource inputs. more efficient entrepreneurial firms, the posable income. Storesletten suggests that How realistic are these assumptions— growth rate of GDP per worker accelerates, the reasons lie in China’s huge structural that firms differ in productivity and in access and the average rate of return to capital transition that removed the social safety net to credit markets—with regard to China? increases as well. on which many had relied. In their discussion of this question, the And finally, the model simulates a grow- “People are saving like crazy in China. economists note that the natural empirical ing foreign surplus—the starting point for An important reason is that the environment counterparts of the model’s entrepreneurial much of this exercise. As investment in is much riskier than in the 1980s.” Why companies and financially integrated firms financially integrated firms declines, banks riskier? Because state-owned firms began to are, respectively, China’s private firms and see less demand for domestic loans. The shed workers, and private companies who its state-owned enterprises. government’s prohibition of bank lending hired them provided fewer benefits and less The latter are large, historically domi- to privately held firms—a key friction built job security. nant companies that have achieved their into the mathematical model—means that “When you look at these numbers, it’s supremacy through explicit government entrepreneurs must use retained earnings, just stunning,” said Storesletten. “In manu- policy. Highly bureaucratic, they grant little not bank loans, to finance expansion. facturing, for example, the share of the labor autonomy to management; incentives are At the same time, the nation’s savings “That puzzled us,” said Storesletten, force employed by private employers was largely unconnected to productivity. “This rate increases because entrepreneurs get “and motivated us to write down a model less than 10 percent as late as 1994, and it’s feature is well documented,” report the richer and they save a large share of their that asked, ‘What if China’s savers just above 60 percent now. For the urban sector economists, referring to research showing income. “Both forces contribute to the cannot get the good investments?’ That idea as a whole, the growth is even larger. So that profit-linked compensation schemes are growing foreign surplus during the transi- pushed us in a certain direction, and along we’re really seeing a very rapid change from rare in state-owned enterprises. Evidence tion,” the economists write. And indeed, the way we discovered a bunch of other very state-owned firms toward private firms.” In also supports the easy access these enter- even though economic output is increasing interesting facts.” less than 15 years, firms change ownership, prises have to loans from state-owned banks. rapidly, the foreign surplus climbs even companies close down and more are created. In contrast, private firms in China have faster, leading to a rising foreign surplus/ Very interesting facts “Workers find themselves shifted from safe little access to credit from government GDP ratio. The economists document a number of jobs in state-owned firms to a highly uncer- banks and so rely heavily on self-financing. Thus, at least in a qualitative sense, the intriguing empirical realities about China, tain environment with private employers.” Why so little access to bank credit? While model successfully mimics much of China’s trends that contrast strongly with economic And while workers’ wages grew during their paper isn’t an empirical investigation, actual growth experience: The rate of return growth in most other nations. For example, this time span, they didn’t increase at the the economists refer to numerous studies from capital doesn’t fall, entrepreneurial in the United States and Europe, wages have same pace as labor productivity or per capita documenting that “private firms are subject firms are less capital intensive than finan- tended to grow at about the same rate as GDP (for low- to medium-skilled workers, to strong discrimination in credit markets.” cially integrated firms, factors of production output per worker, Storesletten observes, but real wages grew about 6 percent annually The historical and political traditions reallocate from integrated firms to entrepre- in China, the wage rate has increased far less from1992 to 2004 compared with 9 percent that guide relationships between state- neurs, the economy runs a long-term foreign than the value added by workers. So “it is real GDP per capita growth. Moreover, en- owned enterprises and the Communist Party surplus and inequality increases between very clear that the pattern of growth is very trepreneurial earnings grew far faster than are decisive in lending judgments made by workers and entrepreneurs. different from anything that we’ve seen.” wages did, resulting in growing inequality— state-owned banks, and the latter control the The economists point out that the model Of course, this pattern grows out of another salient feature of China’s economy.) vast bulk of China’s banking sector assets. also sheds light on the experience of other another set of very special circumstances. “Suddenly, people have very risky wages; As Loren Brandt and Xiaodong Zhu wrote in recent “economic miracles.” “In spite of im- Until the early 1990s, virtually all industry pensions become highly uncertain. People The Region several years ago, “The overrid- portant differences,” they write, “the 1980s and all economic activity in cities were state needed to save a lot more. You would see ing objective of the state banking system has experiences of Korea and Taiwan share owned. Private industry was essentially increased savings rates, not only for the been to provide resources for the state sec- some commonalities with the recent devel- absent. But in the aftermath of the Tianan- young, but also for the old.” tor.” (See “What Ails China?” in the Decem- opment of China. All featured a pronounced men Square uprising in 1989 and following As a result, banks began to accumulate ber 2003 Region online at\ minneapolisfed. reallocation within the manufacturing sector Deng Xiaoping’s Southern Tour in 1992, the more and more savings deposits, while org.) In addition, the economists write, “the characterized by a strong growth of credit- Chinese government began to let private their primary borrowers, state-owned firms, assumption that monitoring is easier within constrained high-productivity firms. The enterprise emerge in every aspect of the were taking out fewer loans as their share of flexible organizations—and most notably in reallocation was accompanied … by an economy other than the financial sector. (See production rapidly declined. “So the banks family firms—seems natural.” acceleration in productivity growth and for- the Focus on China articles in the December then become awash in cash,” observes In any case, “the essential feature of our eign surplus. These features are consistent 2003 Region online at minneapolisfed.org.) Storesletten. “And what do they do? They model’s reallocation mechanism is that fi- with the predictions of our theory.” As a result, investment rates have been buy T-bills.” nancial and contractual frictions obstruct the exceptionally high, nearly 40 percent. One flow of capital towards highly-productive would expect that over time rates of return And do the numbers match? entrepreneurial firms.” Were this not the It’s impressive when a mathematical on that investment would begin to fall as A Chinese model The facts are striking, and at odds with case—if productive entrepreneurs had easy model can follow the general qualitative the most profitable opportunities become conventional wisdom regarding capital access to credit in China—“the transition outline of an empirical reality—when the saturated. Yet in China, “the rate of return flows both to and within China. How then would occur instantaneously. … The fact laboratory formulas operate consistently to capital in manufacturing has been in- can theory be refined to explain China’s that entrepreneurs must rely on their own with the world itself. But to truly prove creasing since the early 1990s,” write the economic transition? savings implies a gradual transition.” its worth, a model must account for the economists, citing an estimate close to 35 The economists devise a model with quantitative facts—that is, once calibrated percent in 2003. two types of companies. Both use capital to resemble the economy in question, the Ironically, while corporate rates of return A mechanism with friction and labor to produce output, of course, but The rapidity with which China has theoretical model should be able to gener- are very high, bank savings accounts have they differ starkly in their access to financial transformed suggests that “gradual” is a ate numerical values close to those seen in yielded little for individuals, just above markets and their levels of productivity. The relative term—the upheaval of the economy reality. IN BRIEF first type of company, termed “financially and society has been breathtaking. But the Here the economists’ model also largely integrated,” has access to funding from economists’ model, with credit constraints succeeds. In particular, it captures well - Though their funds could earn banks that are closely linked to international binding entrepreneurial activity, faithfully the rise in private employment, the rise in much higher returns if invested domes- financial markets. The other type, the “en- follows the outlines of the country’s actual foreign surplus and the time trends seen in tically, Chinese banks invest overseas trepreneurial” firm, does not have access historical trend. China for investment rates, aggregate sav- in low-yield investments like U.S. to bank credit but does have superior skills In the model, entrepreneurs can’t borrow ings rates and overall productivity. Treasury bills. Recent research sug- and operates more productively than the freely, so they’re limited in the amount of They begin by calibrating the basic gests the explanation to this paradox financially integrated firms do. capital they can acquire. Instead, they hire model to match China’s overall economic may lie in firms’ differential access to The fact that the entrepreneurial firms labor that is readily available at a low price structure over the past 15 years. The most bank credit, as well as different levels are credit constrained allows the less both from the Chinese agricultural sector important aspect of the quantitative model of productivity. productive financially integrated firms to (witness the massive rural-to-urban migra- is to set parameters so that the model rep- - The economists theorize that fi- survive, at least for a while. But it involves tion in recent years) and from state-owned licates the empirical differences in rates nancial constraints limit credit access an assumption about how firms are man- enterprises. With easy access to workers but of return to investment and the capital use of productive entrepreneurial firms, aged. In entrepreneurial firms, the owner restricted from borrowing, entrepreneurs in entrepreneurial firms versus financially while large but unproductive firms have achieves greater productivity by delegating operate at far lower capital/labor ratios than integrated firms in China. access but don’t need funds. Lacking authority to a manager and pays the manager do financially integrated firms. The calibrated model is then put through viable domestic opportunities, banks a higher wage to deter the manager from As the model’s entrepreneurial firms hire repeated computer runs to generate values invest overseas. stealing output. workers, their share of the total employment at different points in time for four key - The economists’ empirical simula- “The key assumption is that entrepre- pool rises, as in Chinese reality. At the same variables: tions largely support this theory, with a neurs are better at monitoring their man- time, investment in financially integrated • the fraction of the (urban) labor force close match between model predictions agers,” write the economists. Financially firms slows, since the highly productive employed by entrepreneurial firms and actual data trends over the past two integrated firms are assumed to be weak at entrepreneurial firms accumulate capital • the aggregate savings rate decades. corporate governance and supervision of and account for more and more economic Awash in Cash continues on Page 13 www.chinainsight.info economy SEPTEMBER 2010 > PAGE 13 Awash in Cash empirical estimates. The model generates The economists suggest that this weak- large state-owned enterprises leak their continued from Page 12 an annual TFP growth rate of 5.9 percent; a ness may be due to their model not account- workers to private firms and entrepreneurs • the net foreign surplus 2008 study estimates the figure at about 6.1 ing for reallocation within each type of firm; are prohibited from borrowing from banks. • the aggregate rate of productivity (re- percent, and 2009 research provides a range that is, average profitability of private firms If, however, the Chinese government were ferred to as TFP, or total factor productivity) between 4 percent and 7.7 percent. or of state-owned firms should grow as less to instruct state-owned banks to start lend- The accompanying graphs indicate that productive companies of each type exit their ing to private firms, this would reverse the the model does indeed generate values that respective industries. Indeed, an extension foreign surplus position and increase both closely match trends in actual data, suggest- of the model in a later section of the paper wage and GDP growth as labor and capital ing that the theory behind the model may does just this for financially integrated (or become allocated more efficiently. well explain China’s otherwise puzzling state-owned) firms. “We do explore some While the policy implications seem economic transition. heterogeneity within financially integrated clear, the political reality is far different, The first empirical fact is that workers firms,” observes Storesletten. “But that’s an as Storesletten well knows. Still, China has have shifted in increasing numbers from important limitation that we need to explore seen massive political as well as economic state-owned enterprises to private firms. In further.” transformation over the past 20 years, and Chart 2, the [solid line] represents the results Even with these limitations, the model liberalization of bank lending—though far from the model over a long time period; the and the theory that underlies it have clear from the current trend in Western nations— [dashed line] shows a very similar rising implications. China’s foreign surplus, is a conceivable reality for the world’s most trend in actual data from 1998 to 2007 in driven by imperfect domestic financial dynamic economy.  the share of total employment in private markets, will continue to grow as long as firms. The model successfully matches the data—or as the economists put it: “The Far Afield? calibrated economy generates a speed of employment reallocation comparable to its Capital flows and China haven’t been central to Storesletten’s empirical counterpart.” research agenda. That could change and labor were allocated more efficiently in China, manufacturing productivity would climb between 30 percent and 50 percent. (For a broader look at Klenow’s work, see “Price Signals” in the September 2003 Re- gion online at minneapolisfed.org.) Song, Storesletten and Zilibotti’s re- search was also influenced by an important body of economics literature examining capital flows between rich and poor coun- tries. In a famous 1990 paper, Robert Lucas Weaknesses and future work asked, “Why Doesn’t Capital Flow from The model doesn’t succeed in all re- Rich to Poor Countries?” as neoclassical spects. While it matches some empirical theory predicts. “This is a central question estimates on the proportion of this TFP Second, the model does “remarkably for economic development,” wrote Lucas, growth due to reallocation of resources well” at matching data trends in China’s and four possible answers he discussed from inefficient financially integrated firms overall savings rate. Chart 3 shows a briefly have formed a research agenda for to efficient entrepreneurial firms (about 4.2 [solid line] for the model’s predictions and many economists. percentage points, or 70 percent of the 5.9 a [dashed line] for actual data on savings percent TFP figure), it is far higher than rates. The data indicate that early in the Capital allocation another estimate. Notes Storesletten: “The 1990s savings rates actually decline for a An influential article in this literature biggest shortcoming is that it looks like we while and then rise beginning in 2000 or by Pierre-Olivier Gourinchas and Olivier get very high TFP growth due to realloca- so. The model generates a similar U shape, Jeanne suggests that capital flows among tion, perhaps a bit more than is believable.” Kjetil Storesletten with a decline and then a sharp rise that is poor countries themselves are also quite The model also misses in estimating (Photograph by Marc Norberg) driven by the rapid reallocation of resources puzzling. “[A]llocation across developing average rates of return in both state-owned to the entrepreneurial firms whose owners International capital flows are a depar- countries is the opposite of the predictions and private firms. The model generates a and managers have high savings rates. ture for Kjetil Storesletten, to some extent. of standard textbook models,” they wrote. decline in the rate of return from investing Most of his research has focused on labor “Capital does not flow more to the coun- in, for example, financially integrated firms economics, risk sharing and asset pricing, tries that have a higher marginal product (see Chart 6), but the data indicate that rates and with Jonathan Heathcote and Giovanni of capital.” of return actually increased substantially Violante, he has explored the importance of It’s “a beautiful paper by Gourinchas from 1998 to 2007 for both state-owned heterogeneity to quantitative macroeconom- and Jeanne, a twist on the Lucas puzzle,” enterprises and private firms (see Chart 7). ics. (See “We Beg to Differ” in the June observed Storesletten. “[They] show that 2009 Region online at minneapolisfed.org.) the countries that have fast TFP growth But in 2006, he met co-author Zheng are precisely the countries that are running Song when teaching a short Ph.D. course surpluses. And developing countries that in economics at China’s Fudan University. have low TFP growth are running deficits. The two then collaborated with Fabrizio They call that the capital allocation puzzle.” Zilibotti of the University of Zurich on Song, Storesletten and Zilibotti turn the “Rotten Parents and Disciplined Children,” focus on China precisely because it is one developing a theory of government expendi- of the world’s most productive develop- ture and public debt that merges politics and ing countries yet runs one of the world’s Third, the dramatic climb of foreign economics. Later, the three began to explore largest surpluses by sending capital to the reserves as a fraction of GDP, seen in Chart the puzzles behind “Growing Like China”— world’s richest nation. And while none of 1 […] is duplicated as the [dashed line] in wondering why a country with such a profit- Storesletten’s other research to date has dealt Chart 4 along with the model’s values as a able but credit-constrained entrepreneurial with China, it’s clear he’s been hooked since [solid line]. The match is close but not per- economy was investing enormous sums in he began to learn more about its economy. fect, note the economists; the model runs a low-yield U.S. Treasury bills. “Honestly, I find it very difficult not to be bit higher than reality until 2002 and then In this, the economists were guided interested in China,” he said. underestimates from 2003 to 2007. “Inter- by the research of others. “One paper that And as China grows as an economic, estingly,” they observe, “the model predicts we have been very much inspired by was cultural and political power, that’s likely to an acceleration in the foreign surplus from done by Chang-Tai Hsieh and Peter Kle- be true for us all. 2007 onwards,” due to a sustained increase now,” noted Storesletten. “In some sense, in savings rates paired with a declining rate our whole model started with [their work, —Douglas Clement of domestic investment. which] looked at micro data and computed A fourth measure of success for the mod- TFP [total factor productivity] for each firm Editor’s Note: “Awash in Cash” orignally el regards growth in productivity, or TFP. and how constrained each firm is in terms appeared in the June 2010 edition of The Chart 5 shows a solid line to represent the of capital. They found, for example, that Region, a publication of the Federal Re- model’s estimates for TFP growth over the state-owned firms have much easier access serve Bank of Minneapolis. Visit the Web time period. While precise trend data aren’t to credit and private firms that are very site of the Federal Reserve Bank of Minne- available, the economists write that their efficient have little access to credit.” The apolis at www.minneapolisfed.org to view results are broadly consistent with recent Hsieh-Klenow paper estimated that if capital The Region online. PAGE 14 > SEPTEMBER 2010 culture www.chinainsight.info China’s ethnic minorities We continue our series on China’s 55 ethnic minority groups. This month features the Xibe ethnic minority

abandoning their land to the Xianbeis. to Xinjiang to consolidate and reinforce the Between A.D. 158 and 167, the Xianbei northwestern border defenses. For this gar- people formed a powerful tribal alliance risoning assignment which was to last 60 under chieftain Tan Shihuai. Between the years, 1,016 Xibe officers and soldiers were third and sixth centuries, the Murong, dispatched, and they took along more than Tuoba, Yuwen and other powerful tribes 2,000 family members. In one year and five of Xianbei established political regimes in months, the poorly-equipped Xibes scaled the Yellow River valley, where they mixed mountains and forded rivers, eating in the with Han people. But a small number of wind and sleeping in the dew, trekking across Xianbeis never strayed very far from their deserts and grasslands in Mongolia to the native land along the Chuoer, Nenjiang faraway northwestern border. With striking and Songhua rivers. They were probably stamina and tenacity, they endured starvation, the ancestors of the Xibe people. drought, diseases and difficulties brought Before the Ming Dynasty (1368- about by Qing officials, big and small, who 1644), the Xibe ethnic group lived in a embezzled army provisions and goaded them vast area centering around the present-day on. This was how the Xibes came to live far Fuyu County in Jilin Province and reach- apart in northeast and northwest China. The ing as far as Jilin in the east, Hulunbuir in heavy toll taken by the trip sharply reduced the west, the Nenjiang River in the north the originally small Xibe population. and the Liaohe River in the south. In the The ancient Xibe people lived by fishing late 16th century, the Manchu nobility rose and hunting generation after generation. By to power. In order to expand their territory the mid-16th century, the social organizations and consolidate their rule, the Manchu rul- of the Xibe ethnic group had shifted from ers repeatedly tried to conquer neighbor- blood relationship to geographical relation- Source: commons.wikimedia.org ing tribes by offering them money, high ship. The internal links in the paternal consan- The Xibe ethnic minority are trimmed with laces. Men wear short position and marriage, and more often by guineous groups became very loose. In each armed force. Various Xibe tribes submitted Xibe village lived members with different Population: 172,900 jackets with buttons down the front, with themselves one after another to the author- surnames. Because of the low productivity, Major areas of distribution: Xinjiang, Jilin the trousers tightly tied around the ankle. ity of the Manchu rulers. By the end of the collective efforts were required in hunting and Liaoning They wear long robes in winter. The Xibe 17th century, the Xibe tribes in different and fishing. Members of the same village Language: Xibe costume in northeastern China is basically areas had all been incorporated into the maintained relatively close links in productive Religion: Polytheism, Shamanism and the same as that of the Han people. Rice “eight banners” of Mongolia and Manchu. labor, and basically abided by the principle Buddhism and flour are staples for the Xibes. Those in Xinjiang who raise cattle and sheep like According to the “eight-banner system,” of joint labor and equal distribution. By the soldiers in the banners worked the land mid-17th century, the “eight-banner system” The Xibe ethnic minority, with a popu- tea with milk, butter, cream, cheese and in time of peace and went to battles dur- had not only brought the Xibe people under lation of 127,900, is widely distributed other dairy products. April 18 on the lunar ing wartime, shouldering heavy military the reign of the Qing Court, but also caused over northern China from the Ili area in the calendar is the festival of the Xibes, who and labor services. In less than 150 years drastic changes in their economic life and Xinjiang Uygur Autonomous Region in the would make flour or bean sauce on this day after the Qing Dynasty (1644-1911) was social structure. west to the northeast provinces of Jilin and to mark the successful conclusion of their founded, the Xibe people were removed The Xibes are a hard-working and cou- Liaoning. ancestors’ westward move. In autumn, they would pickle cabbage, leek, carrot, celery from their native land in northeast China rageous people. Although geographical and hot pepper. The Xibes enjoy hunting to various other places as far as Yunnan isolation has given rise to certain differences Customs and Xinjiang. The Qing court also gave between the Xibes in northeast and northwest The Xibe people in northeast and north- and fishing during the slack farming season. They also cure fish for winter use. different treatment to various Xibe tribes China in the course of history, they have west China have each formed their own according to the time and way of their all made contributions to developing and characteristics in the course of development. There are usually 100 to 200 households in each Xibe village, which is enclosed with submission to show varying degrees of defending China’s border areas. The Xibes The language and eating, dressing and liv- favor and create differences in classifica- in Xinjiang in particular have made great ing habits of the Xibes in the northeast are a wall two or three miles long. A Xibe house usually consists of three to five rooms with tion among them. contribution to the development of farming close to those of the local Han and Manchu In the mid-18th century, the Qing and water conservancy in the Ili and Tacheng people. Living in more compact communi- a courtyard, in which flowers and fruit trees are planted. The gates of the houses mostly government quelled the rebellions in Jung- areas. Since the Qing court stopped supply- ties, those in Xinjiang have preserved more gar and other localities of Xinjiang, and ing provisions to the Xibes after they reached of the characteristics of their language script face south. Xibe women are good at paper cutting, and windows are often decorated moved Xibes and people of some other Xinjiang, they had to reclaim wasteland and and life styles. The Xibe language belongs to ethnic minorities from northeast China cut irrigation ditches without the help of the the Manchu-Tungusic branch of the Altaic with beautiful paper-cuts. Language Family. Legend has it that the In the past, each Xibe family used to Xibe ethnic group once had its own script consist of three generations, sometimes but has lost it after the Qing Dynasty (1644- as many as four or five generations, being 1911) was founded. A growing number of influenced by the feudal system. Marriage Xibe people came to learn the Manchu was, in most cases, decided by parents. and Han languages, the latter being more Women held a very low status and had no widely used. In Xinjiang, however, some right to inherit property. The family was Xibe people know both the Uygur and governed by the most senior member who Kazak languages. In 1947, certain Xibe had great authority. When the father was intellectuals reformed the Manchu language living, the sons were not allowed to break they were using by dropping some phonetic up the family and live apart. In family life, symbols and adding new letters of the Xibe the old and the young each had his position language. This Xibe script has been used as according to a strict order of importance, and an official language by the organs of power they paid attention to etiquette. “Hala,” a in the autonomous areas. council formed by male clan heads, handled The Xibe ethnic minority in Xinjiang be- major issues within the clans and enforced lieved in Polytheism before China’s national clan rules. liberation in 1949. In addition to the gods of insect, dragon, land and smallpox, the Xibes History also worshipped divine protectors of homes The Xibes think they are descendants and animals. Besides, some Xibe people of the ancient Xianbei people, and there believe in Shamanism and Buddhism. The are many versions of the origin of this Xibe people are pious worshippers of ances- ethnic group. Xianbei was a branch of the ancient Donghu ethnic group in northern tors, to whom they offer fish every March Journey to the west:Young men from the Xibe minority perform the “Samen” ethnic dance China, roving as nomads over vast areas and melons every July. in Shenyang, capital of Liaoning Province. The ceremony in 2004 marked the 240th an- between the eastern slopes of the Great In clothing, the Xibe women in Xinjiang niversary since 5,200 Xibe people moved to the Xinjiang Uygur Autonomous Region from Xinggan Mountains in northeast China. In like close-fitting long gowns reaching the Liaoning during the Qing Dynasty (1644-1911). Source: China Daily instep. Their front, lower hem and sleeves A.D. 89, the northern Xiongnus, defeated by the Han Dynasty troops, moved westward, Minorities continues on Page 15 www.chinainsight.info culture SEPTEMBER 2010 > PAGE 15 Minorities continued from Page 14 into the “Eight Banners” of the Manchus, Ancient art with a modern twist government. They first repaired an old canal under which the banner’s land was owned “publicly” and managed by the banner of- and reclaimed [1647.5 acres] of land. With One young man set on preserving his cultural heritage is battling the increase of population, the land became fice. Irrigated land was mostly distributed insufficient. Despite such difficulties as lack among Banner officers and soldiers in armor growing influences from the West to keep an ancient opera alive. of grain and seeds and repeated natural di- according to their ranks as their emolument. sasters, the Xibe people were determined to The rest was leased to peasants. This system By Li Xinzhu, China Daily turn the wasteland on the south bank of the of distribution from the very beginning Wearing a punk hairdo and a rhinestone- the Hall of Floral Elegance. Ili River into farmland to support themselves deprived the Xibe people of the irrigated studded denim jacket, 36-year-old Zhang Since then, his troupe has performed in and benefit future generations. After many land which they had opened up with blood Jun looks more like an aging rock star than Taiwan a traditional play with contemporary failures and setbacks, they succeeded in and sweat. an opera singer harboring a burning ambi- lyrics by a Shanghai writer. Zhang says his 1802 after six years of hard work in cutting In the 1880s, the “banner land system” tion to revitalize Kunqu Opera. performance received encouraging reviews on mountain cliffs a [124-mile] irrigation for the Xibe people in northeast China began Zhang is a graduate of business admin- by critics in Taiwan. channel to draw water from the Ili River. to collapse, and the banner land quickly istration from Shanghai Jiaotong University, But his daring exploits in modernizing With the completion of this project, several fell under the control of a few landlords. but he talks passionately about his efforts in Kunqu has drawn the ire of purists on the Xibe communities settled along the channel. Although the banner system stipulated that the past decade in “imbuing an element of mainland who criticized Zhang for being Later, the Xibe people constructed the banner land could not be bought or sold, modern marketing into an ancient art form”, a crowd-pleaser by arbitrarily debasing another canal to draw water from the up- cruel feudal exploitation gradually reduced which is facing the threat of extinction. the art. per reaches of the Ili River in the mid-19th the Xibe people to dire poverty and deprived Kunqu is widely recognized as the mother “What he is doing right now is obviously century. In the 1870s, they cut two more them of their land, and an increasing number of all operas in China. not mainstream Kunqu. He’s just selling the irrigation channels, obtaining enough water of them became farmhands and tenants, “We must act now before Kunqu is stunt,” a Kunqu actor, who declined to give for large-scale reclamation and farming. The leading a very miserable life. completely buried by the avalanche of his name, says. local Kazak and Mongolian people learned Western influence mak- a lot of farming techniques from the Xibes. Life After 1949 ing irreversible changes While building irrigation channels and The founding of the People’s Republic to the Chinese cultural opening up wasteland, the Xibes also joined of China in 1949 ushered in a bright future landscape,” Zhang soldiers from other ethnic groups in guard- for the Xibe people, who have since enjoyed says. “As a performer, ing the northwestern border. In the 1820s, political equality as one of the smaller I consider it my duty to more than 800 Xibe officers and soldiers ethnic minorities in China. In March 1954, preserve our heritage.” fought alongside Qing government troops the Qapqal Xibe Autonomous County was In doing so, he and on a punitive expedition against rebels established on the site of Ningxi County other Kunqu perform- backed by British colonialists. In a decisive in Xinjiang, where the Xibe people live in ers are walking the fine battle they wiped out the enemy forces and compact communities. line of achieving wide- captured the rebel chief. Since 1949, a series of social reforms spread appeal with- In 1876, the Qing government decided have been carried out in the Xibe areas. out compromising the to recover Xinjiang from the Tsarist Rus- Industrial and agricultural production has artistic essentials that sian invaders. The Xibes stored up army grown tremendously and people’s living were never meant for provisions in preparation for the expedition standards have gone up accordingly. The Zhang Jun stars in a Kunqu play. the crowd. despite difficulties in life and production economic and cultural leaps in the Qapqal Evolving from the Kunshan melodies “I don’t like his way of performing my inflicted by the marauders and cooperated Autonomous County are a measure of the of Central China, Kunqu gained popularity favorite art with so many commercial ele- with the Qing troops in mopping up the great success the Xibe people have achieved. among the mandarin intellectuals of the ments. He is ruining the art,” a fan posted Russian colonialists south of the Tianshan As a result of their hard work, grain output Ming (1368-1644) and Qing (1644-1911) in a popular Kunqu forum on Mountain and recapturing Ili. in the county in 1981 was nearly four times dynasties and dominated theaters in 16th to www.douban.com. The Xibe people in Xinjiang staged the pre-liberation average, and the number 18th century China. But Zhang says he is just as keen as his an uprising in support of the Revolution of cattle three times as big. Small indus- In traditional Kunqu Opera, there are critics in defending the purity of Kunqu of 1911 soon after it broke out. Those in trial enterprises including coal mines, farm only a few singers performing in simple from being adulterated by the attempts to northeast China joined the Han and Manchu machinery works, fur and food processing costumes on a rather bare stage with hardly sell more tickets. The lyrics may be new, people in anti-Japanese activities after that mills, which were non-existent before, have any props. The music is subdued and the he says, but he has painstakingly adhered part of the country fell under Japanese rule been built for the benefit of people’s life. performance ethereal. Purists love Kunqu to the authenticity of the performance. “We in 1931. Many Xibes joined such patriotic There are in the county 12 middle schools for the spiritual experience, compared to the are traditionalists,” he insists. forces as the Anti-Japanese Allied Forces, and 62 primary schools enrolling 91.3 per more sensual enjoyment of watching Peking Any departure from tradition, he says, the Army of Volunteers and the Broad cent of the children. The Xibe people have or Cantonese operas. is in the marketing and promotion part of Sword Society. Quite a few Xibes joined always been more developed education- Kunqu began its gradual decline in the the shows. Instead of looking to the State the Chinese Communist Party and the Com- ally. Many Xibe intellectuals know several 19th century when Peking Opera won the for subsidies, “we are actively soliciting munist Youth League to fight for national languages and work as teachers, translators hearts of courtesans of the decaying Qing corporate and other sponsorships”. liberation. In September 1944, struggle and publishers. Horse riding and archery are Dynasty. The Empress Dowager was a His major backers, so far, include Zendai against Kuomintang rule broke out in the two favorite sports among the Xibe people. famous fan. Group, a Shanghai real estate developer, Ili, Tacheng, Altaic areas in Xinjiang. The Since 1949, endemic diseases with a high In recent years, only a small group of and Shanghai’s Jingan district government,

Xibes there formed their own armed forces mortality rate such as the Qapqal disease

aficionados, mostly intellectuals on the which provides him with premises in an and fought along with other insurgents. have been stamped out, and the population mainland and Taiwan, have kept the flicker- historical building at subsidized rental. “We Before 1949, the feudal relations of of the Xibe has been on the increase. ing Kunqu flame alight. welcome corporate sponsorship,” Zhang production in Xibe society emerged and de- Source: People’s Daily Online Zhang learned Kunqu in high school as says. veloped with the incorporation of the Xibes http://english.peopledaily.com.cn/ part of his extracurricular activities, urged When he was still at the institute, he Loudi Student continued from Page 6 and encouraged by his parents. The love accepted an invitation by a French liquor and that’s good.” She doesn’t get to see the affair did not start immediately, and he ini- importer to stage a Kunqu performance for good university. Grace plans to go to col- fire works in real life, but she doesn’t mind tially attended classes merely to please his a sales promotion in Xintiandi, Shanghai’s lege but struggles with not knowing which much. What she really loves about her parents. It was not until he was in university swanky entertainment district. college she wants to go to. She may even culture is the very colorful traditions and its that he started performing regularly for his “Such commercial support has enabled go to college in America. rich history. “That’s only some things but fellow students and the passion was ignited. us to promote the art to the public.” The biggest difference between America there is so much more,” Grace said. “I was the first person to bring Kunqu to The survival of Kunqu cannot be assured and China is the schools and how many “America is nice” says Grace. Since the university campus,” he recalls. He was unless the public is willing to pay to go to students there are in one class. In China being in America for only three days she has also the first person to stage an entire play the theater, he adds. they have about 50 students in one class, been to MOA and Eden Prairie High School. of Kunqu Opera in English for a foreign “We used to play for free at universities,” said Grace. School goes from 7:30 a.m. to She and her classmates still plan to do many audience. Zhang says. Now, “the universities pay us 12:00 p.m. and night school from 7:30 p.m. other things for the next 14 days. They all After graduating in 2000, Zhang became to perform there. At least, we have made to 9:30 p.m. They have to learn English at plan to go swimming and go to other states a full-time contract actor at the government- some progress”. school too. All Grace does is go to school, than just Minnesota. She loves the sweets funded Shanghai Kunqu Institution. He The debate may go on, but Zhang is not she doesn’t spend much time on her and her and the food is alright. Grace really likes was later promoted to deputy director of waiting around to hear the final verdict. For hobbies. School is very important and is how the environment is clean and there is so the troupe. him, the passion to preserve Kunqu shouts held very high in their community. much space compared to China. In China, Frequent stage performances gave him louder than any dissenting views and he is I asked Grace what she does during the they have really tall buildings, little grass, sufficient confidence to question the com- sticking to his beliefs.  Chinese New Year. She answered, “Playing and little choice she said. She still wants mon belief that Kunqu could only survive on cards and spending a lot of time with my to see much more of America. Grace and government subsidies. In September, he re- Reprinted by permission of China Today. family eating and watching the programs her classmates are very excited for more of signed from his cushy job to prove his point www.chinatoday.com.cn on TV. I also get money after the New Year what America holds.  by forming his own troupe, Huayatang, or PAGE 16 > SEPTEMBER 2010 culture www.chinainsight.info Rare World Map of 1602 viewed by Chinese Heritage Foundation group By Greg Hugh, Staff Writer group of Chinese Heritage Foun- is popularly called, will eventually reside at “Ricci’s map uniquely captures the exciting, astronomy. Yet the best reading may be dation (CHF) members and in- the James Ford Bell Library at the Univer- strange, and contradictory world of the Age his colorful accounts of various regions of Avited guests were fortunate to sity of Minnesota. of Exploration, when the earth seemed both the world. For instance, he described the attend an exhibition at the Minneapolis “Presenting Global Positioning gives us to expand and to shrink. Cultures virtually rhinoceros of Africa with some accuracy as Institute of Arts (MIA) before it ended on a great opportunity to place the Ricci map in unknown to one another were thrust togeth- “a beast with a head like a horse, a horn on August 29, 2010. The special tour was the context of our own strong collection of er, new lands and seas were meticulously his forehead, and an extremely thick hide.” arranged by CHF Board Member, Yin Asian art, as well as provide our audiences mapped and catalogued, yet despite this Other descriptions rely on legend, such as Simpson that featured a lecture by our own with insight into East and West world trade explosion of knowledge, the fantastical, the the crane-fearing dwarves “only about 1 foot docent (specially-trained volunteer of MIA), in the seventeenth century,” said Kaywin legendary—giants and dwarves, satyrs and high” in Russia, the humans “with the feet of Charlie Ellias, followed by a special dinner Feldman, Director and President of the MIA. dragons—were still believable.” oxen” in Turkey, and “the one-eyed people” at the Tea House on University Avenue in “We are honored to have this magnificent Ricci was born in Macerata, a small who inhabited the region of Kazakhstan. Minneapolis coordinated by CHF Board document at the Minneapolis Institute of town in the Marche region in Italy in 1552; Although our personal docent, Charlie member, Margaret Wong, with a special Arts before it goes to its home at the James he traveled to China as a Jesuit missionary was not able to read the Chinese text that menu recommended by Tea House owner, Ford Bell Library.” in 1582 and remained there until his death was included by Ricci, quite a few of the in- Yolanda Wang. Museum visitors were able to gain a in 1610. His religious devotion was matched quisitive group were able to do so and were by his intellectual curiosity. A professor of fascinated with the commentaries. As a rhetoric with interests in science, astronomy, matter of fact, one of the group detected that and geography, Ricci first gained favor the map may have been edited and intends in China with the powerful literati class. to do some additional research as to why. Adopting the dress of Chinese intellectuals The Ricci Map was recently sold to and speaking extraordinarily fluent Chinese, the James Ford Bell Trust by London’s re- Ricci shared the recent advances of Western nowned rare book seller, Bernard J. Shapero, science and introduced his new colleagues to for the benefit of the James Ford Bell Li- the latest scientific instruments of Europe— brary at the University of Minnesota. The complex astrolabes, exacting quadrants, map was recently on display at the Library terrestrial globes, and accurate timepieces. of Congress. After the exhibition at the Min- In his own words, Ricci “amazed the entire neapolis Institute of Arts, the map will move philosophical world of China.” His efforts to its intended home in the James Ford Bell were rewarded with an invitation to enter Library at the University of Minnesota. The the Forbidden City in 1601, making him map will be featured as part of the Matteo possibly the first westerner to be admitted. Ricci and the Jesuits in China Exhibit which Robert D. Jacobsen, Chair of Asian begins on Sept. 15, 2010. For information Art at the MIA said, “While Ricci found a go to www.bell.lib.umn.edu. sophisticated intellectual climate in Ming As noted earlier, the group gathered at China and a country with a long and dis- the Tea House after the tour and enjoyed a Chinese Heritage Foundation members and invited guests (photo courtesy of Scott Simpson) tinguished mapping tradition that for over scrumptious multi-course dinner that was two thousand years had been a major player leisurely paced, graciously served in a fan- Matteo Ricci’s monumental world map sense of the richly stimulating 17th century in international trade, he also encountered tastic setting so that all could enjoy the meal of 1602 is the oldest surviving Chinese Chinese society in which Ricci worked scholars who were ravenous for better geo- and camaraderie amongst the gathering. map to show the Americas - and the first through a number of objects hand-picked graphic information about contemporary Evidently no one was anxious to go home known map to combine western and eastern from the MIA’s extensive Asian collec- Europe and the New World discoveries. The but since the restaurant was closing, the cartography and which placed China at the tion. Ming dynasty objects, Chinese export Ricci map gave China its first overview of group concluded by celebrating the birthday world’s center. Only six complete copies porcelain, Western maps, and Counter- the total globe.” of Ming Tchou, founder of CHF. of the woodblock print are known to exist. Reformation devotional images all will help Ricci set to work on his outsized map To learn more about the Chinese Heri- Now, the Twin Cities is home to the only to evoke the cultural, religious, and intel- just after this visit. tage Foundation visit their Web site at

example in the United States, acquired last lectual exchange between China and Europe The map’s enormous size—approxi- www.chineseheritagefoundation.org or plan year by the James Ford Bell Trust after it in the late sixteenth and early seventeenth mately 5 by 12 feet, printed from wood- to attend their Open House on Oct. 18, 2010. emerged from a private Japanese collection. centuries, as will a group of rare Chinese blocks on six large sheets of paper—was Everyone is welcome to attend. It is titled Kunyu wanguo quantu, or Com- woodblock prints from a Bible published necessary to make room for Ricci’s ex- plete map of all the nations of the world. by Ricci’s Jesuit colleague Giulio Aleni. tensive commentary. Writing in Chinese Editor’s Note: Much of the material for this Although the exhibit at MIA has concluded, Rachel McGarry, MIA’s Adjunct As- characters, he elaborated on such things article was obtained from The Minneapolis “The Impossible Black Tulip,” as the map sistant Curator for Prints & Drawings said, as geographic systems, cosmography, and Institute of Art.

A copy of the Matteo Ricci World Map of 1602, Kunyu wanguo quantu (Complete map of all the nations of the world), owned by the James Ford Bell Trust