China fears fast-rising unemployment could trigger social unrest

Companies in two Chinese provinces, Shandong and Hubei, have been told they must seek official consent if they want to lay off more than 40 people.

The order highlights the Chinese authorities' concern over mounting job losses.

As China's main external markets plunge into recession and export orders shrink, layoffs have multiplied in the country's big manufacturing regions.

ler BBC

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South China Morning Post

During the period of reform, Beijing also accomplished the goal of securing the return of Hong Kong's sovereignty to the motherland in 1997 and Macau's in 1999, though relations with the breakaway island of Taiwan have been rocky. [...]

On November 24, 1978, under the dim light of an oil lamp, 21 farmers in Xiaogang village in the eastern province of Anhui marked their fingerprints on a contract that divided community-owned farmland into plots for individual households.

The contract stipulated that if their arrangement was discovered and any signatory thrown in prison, the others would raise their children until they turned 18.

The controversial move, initially attacked as a return to capitalism, triggered a wave of revolutionary changes leading to the system of 30-year leases on land plots, and marked the beginning of the mainland's historic process of opening and reform.

Last month, in what was called a ‘landmark policy document’, the ruling Communist Party's Central Committee agreed to allow small farmers to sell their right to till the land.

At the time the Anhui villagers were turning their backs on collective farming, entrepreneurs in the Pearl River Delta began setting up small factories to provide original equipment manufacturer (OEM) services to businesses in Hong Kong. Dajin Textiles in Shunde, Guangdong, is believed to be the first OEM factory established in the area, at a time when foreign trade was strictly regulated.

Through political wisdom or sheer good fortune, the two groups' bravery in challenging political taboos was endorsed by the Communist Party under reformist leader Deng Xiaoping.

The Xiaogang model was soon copied by thousands of villages across the province, and the Shunde experiment was said to have eventually prompted the top leadership to designate four ‘special economic zones’ in 1980. They were Shenzhen, Zhuhai, Shantou and Xiamen. In 1985, a further 14 port cities were opened to overseas investment. These were the first to receive foreign capital and technology, and have since been leading China's export boom.

It is tempting to say that changes might have taken place even earlier, when the disgraced Deng made a political comeback after the death of chairman Mao Zedong and the downfall of the Gang of Four, Mao's political allies, in 1976. Back then, the pressing need for change, no matter how painful, was obvious. The mainland was just emerging from the shadow of the devastating Cultural Revolution, and decades of economic and social mismanagement had impoverished the country.

Before a crucial party plenum to set the country's new course, Deng's men launched an ideological debate on the so-called ‘criterion of truth’ to prepare for change.

The tide began to turn for good at that meeting - the Third Plenum of the 11th Chinese Communist Party Central Committee - in December 1978. Deng, then vice-premier, wrested power from the conservative faction headed by Hua Guofeng, the party chairman who remained staunchly faithful to Mao.

With the victory of the Deng credo - ‘practise is the only test of truth’ - the meeting marked the turning point in the party's central policy theme away from the idealism of socialist revolution towards economic development, thus ushering in the era of opening and reform.

‘Thirty years of reform and opening up have brought about historic changes in China's development and created the fastest major growing economy,’ said Chi Fulin, executive president of the China Institute for Reform and Development.

Deng's reform suggested a loosening of central controls on economic life, undertaken in a spirit of pragmatism and gradualism as an antidote to Mao's ideology of class struggle. Similarly, it heralded China's integration into the global economy.

Since then, market-oriented reform has been the common thread running through transfers of political power from Deng to former leader Jiang Zemin and President Hu Jintao, although internal power struggles have occasionally slowed the pace.

There was debate on the pace of reform between the reformist camp, headed by Deng, and some conservatives headed by Chen Yun throughout the 1980s and early 1990s. Deng prevailed, however, and set the course of reform in stone with his famous 1992 south China trip.

Mismanagement of the economy and internal power struggles helped trigger nationwide pro-democracy protests, and the consequent bloody military crackdown on student demonstrators in Tiananmen Square on June 4, 1989, was a major setback for China's reform and diplomacy.

Power struggles also led to the sacking of two top reformist party officials and Deng's hand-picked political successors, Hu Yaobang and Zhao Ziyang, for being sympathetic to political liberalisation.

Despite facing continuous challenges at home and abroad to one-party rule, China's Communist Party remained politically secure, avoiding the widespread collapse of socialism in the 1990s. The mainland's economic boom began in the countryside in 1978, lasted through the 1980s, and was followed by today's urban, industry-led growth.

The mainland has seen booms in almost all sectors of the economy and society, including foreign investment, trade, financial markets, consumption, travel, overseas study, military modernisation and foreign relations. There is also a booming interest in western culture and a new, modern lifestyle that incorporates foreign movies, fashion and design, and even religion - from home-grown Confucian philosophy to Buddhism and Christianity.

From 1978 to last year, the mainland's gross domestic product grew by 9.6 per cent annually from $216US.5 billion to $3US.6 trillion. Fiscal revenue grew 45-fold from 113.2 billion yuan ($128HK.5 billion) to 5.1 trillion yuan, greatly increasing national strength.

Material life for the general population has never been better, with a staggering 300 million people lifted out of poverty during this time. The World Bank hails that as the biggest poverty-reduction effort in history and the country's greatest contribution to world development. Today China is the world's fourth-largest economy, holding $1US.9 trillion in its coffers - the wealthiest by that measure. It is the third-largest trading nation and a favoured recipient of foreign direct investment.

China's economic and political clout is growing so rapidly in some regions, such as Africa, that critics have labelled Beijing a ‘neo-colonialist’. This record of development has become an inspiration to many around the world as developing economies turn to China in search of solutions to their own developmental difficulties.

With its recent hosting of the spectacular 2008 Beijing Olympic Games and a Chinese astronaut's historic spacewalk, the nation appears to have created an image for itself of a global power second only to the United States. Beijing has played an increasingly significant leading role in many important international organisations and global affairs. Its support during the current global financial turmoil, for instance, is strongly sought by western nations.

During the period of reform, Beijing also accomplished the goal of securing the return of Hong Kong's sovereignty to the motherland in 1997 and Macau's in 1999, though relations with the breakaway island of Taiwan have been rocky.

Of course, the cost of the economic miracle should not be discounted. The environmental damage has been staggering, the gap between rich and poor is growing - most citizens lack sufficient health and retirement programmes - and corruption has never been reined in. More worrying, the economic boom has not brought systemic political reform and rule of law to an increasingly sophisticated economy and society, as many had hoped.

‘Compared with the forceful and well-paced economic reform, political reform has not yet started - which obviously results in an income gap and strains society,’ veteran dissident Dai Qing said.

Despite its economic success, she said, the mainland still faced risks and formidable challenges, and its future success rested on the fundamental reform of its political system and introduction of the rule of law.

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«The Washington Post reports the story today, “Chinese Consumers Eager to Excel at the American Pastime“:

Long known for high saving rates, China’s middle-class consumers are starting to spend like their American counterparts. Of China’s 11.4 percent growth in the gross domestic product last year, the largest segment, 4.4 percent, was in consumer spending. That sector still represents just 38 percent of China’s overall GDP, roughly half the percentage in more developed countries, but in the eyes of retailers that means more opportunity….

Meanwhile, some Chinese consumers are also adopting the biggest vice of American consumers: debt. Mesmerized by a banquet of Western-style financial products, some Chinese consumers are juggling multiple credit cards, consumer loans and installment plans to buy an ever-increasing quantity of cars, washing machines and vacations.»

ler mais... em Climate Progress

Comentário: se o modelo a seguir pelos consumidores chineses fôr o norte-americano, então o futuro reserva-se muito sombrio para todo o planeta!

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By Michael Bristow BBC News, Beijing

As industrial output drops, workers are being laid off

Chinese Premier Wen Jiabao says the effect of the global financial crisis on China is "worse than expected", according to reports.

It is the first time the premier's personal view on how the crisis is affecting China has been made public.

His words come days after the country announced a $586bn (£370bn) stimulus package to avoid the economy slowing.

BBC

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La crise des subprimes et ses conséquences pour les systèmes financier et bancaire, ainsi que sur l’économie réelle, sont actuellement, et très naturellement, l’objet de toute l’attention des médias. Cependant, ceux-ci se sont essentiellement focalisés, pour l’instant, sur la situation des pays occidentaux, Etats-Unis au premier chef, et Union Européenne ces dernières semaines. Il est certain que ceux-ci sont les plus concernés par la crise, ils en sont à la fois le siège premier et, pour l’instant, les principales victimes. Cette crise est néanmoins destinée à devenir mondiale, et ses répercussions se feront également sentir dans les pays en voie de développement. La République populaire de Chine a déjà commencé, de manière particulièrement aigüe ces dernières semaines, à en ressentir les premiers effets.

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Chinese Premier Wen Jiabao has said developed countries should change their "unsustainable lifestyles" to tackle global warming.

Mr Wen said richer nations should help poorer ones solve the global problem.

United Nations climate chief Yvo de Boer said rich countries had to transfer cleaner energy technologies to developing nations.

The two were speaking at a two-day conference in Beijing discussing climate change.

Mr Wen said the international community must not waver in its determination to tackle climate change.

But he made it clear where the main responsibility lay.

Developed countries had a "responsibility to tackle climate change and should alter their unsustainable lifestyle", he said.

'Weightier problem for us'

Among others, Chinese officials have previously suggested that rich nations use 1% of their gross domestic product to pay for the transfer of clean energy technologies to developing nations.

While promising China will play its part, Mr Wen said his country faced a more difficult task than developed countries.

He said it took rich countries several decades to get round to saving energy and cutting greenhouse gas emissions, which cause global warming.

"China has to solve the same problem in a relatively much shorter period," he said.

China has so far declined to place a cap its greenhouse emissions.

Technology transfer

Mr de Boer, executive secretary of the UN Framework Convention on Climate Change, also said richer nations should pay more to tackle the problem.

"If international technology transfer happens, countries like China will be able to take action which is not affordable to them at the moment," he said, speaking at the same conference as the Chinese premier.

He urged developed countries to speed up the transfer of these technologies.

The current treaty that tries to limit greenhouse gas emissions - the Kyoto Protocol - runs out in 2012.

Negotiators will start discussing what will replace it in Poland next month.

in BBC

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