Over the past few months, the Chinese stock market, rather than its real economy, has been making headlines. The index rose almost 50% between March and mid-June before coming back to the March level over the next four weeks, when the authorities took several steps to halt the slump. These moves—like reducing interest rates, restricting margin trading, getting some state-controlled organizations to buy equities or provide margin money, suspension of trading in a number of shares, etc—are standard measures which all policymakers, including those in Anglo-Saxon economies, take when a bubble in asset prices bursts.
Market euphoria and gloom are recurring features of all financial, or asset, markets, and exaggerated when leveraged, or margin, trading is preponderant. To recall a few examples from the supposedly deep and “mature” US financial markets: the October 1987 crash of the stock market; the “rescue” of Long-Term Capital Management, a hedge fund, by the Fed “persuading” several banks to take it over; the bursting of the dotcom bubble in 2000; and the 2007-08 crisis in the mortgage securities market. The US Federal Reserve is famous for writing a “Greenspan put” option in favour of markets.
More important in the long term is the way China has been fostering the internationalization of the yuan. A few years ago, Arvind Subramanian, now India’s chief economic adviser, wrote a book titled Eclipse: Living in the Shadow of China’s Economic Dominance. His argument is that, given the size of China’s economy (the world’s largest in purchasing power parity terms) and trade, and the fact that China is the world’s largest creditor nation while the US is a very large debtor, China is likely to become the dominant financial/economic power in the near future.
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China is not emerging from a vacuum. It has a well-documented history of excellence, writes Jeffrey Sehume.
Johannesburg – For conscientious researchers the exercise of studying societies removed from the mainstream is not simply to collect information and gather facts.
For these researchers, keen to loosen the mysteries behind the formerly unknown, the journey is to evaluate “new” experiences, to perhaps draw comparative lessons. Ultimately, this is done in order to illuminate the past, improve understanding about the present, and inform the future. The People’s Republic of China has drawn the interest of lay researchers and scholars since that country began to open up in 1978.
Interest in this strikingly different society has tended to focus on unravelling the political and economic frameworks responsible for its status as a powerhouse for the new millennium.
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As the Dalai Lama exiled in India turned 80, the situation regarding the Tibet issue has reached a crucial stage. There seems to be no chance of resumption of talks between Beijing and the representatives of the spiritual leader as deep differences between the two sides persist; the last contact was five years ago. China’s economic and security policies have led to an overall stability in Tibet; its international economic clout has grown leading to a weakening of foreign support to the Dalai Lama’s movement. With these as basis, China may feel confident about its ability to control events in Tibet and despite some internal viewpoints in favor of a soft line towards the Dalai Lama, China may not be in a hurry to reach a rapprochement with the latter. It is quite possible that China would choose to wait for the passing away of 14th Dalai Lama and appoint his successor on its own within the country in which case it can hope for a close to the Tibet issue once for all. Till such time, there may not be an end to the prevailing stalemate with respect to the Tibet issue. The stalemate has negative implications for relations between India and China though the Tibet issue is not a bilateral political problem among them. Any settlement of the issue between Beijing and the Dalai Lama can contribute to creating a right atmosphere for solving the vexed India- China border problem which was once non-existent and arose only after China liberated ’Tibet.
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Hong Kong’s mother tongue is under threat. Cantonese may be centuries old but how much longer can it sustain the pressure from China to pick up Putonghua? By Arthur Tam and Anna Cummins. Additional reporting by Emily Cheng and Allen Jim
Our tongue. Our voice.
Language is the tongue that gives a nation its voice. And Hong Kong’s voice has never been as intrinsically linked to its identity as it is right now. Cantonese isn’t just the city’s language; it’s one of the many yardsticks by which Hongkongers measure their cultural and political differences from the rest of the Mainland.
We all know the abrasive political situation between the Central People’s Government and the SAR is complex, contentious and set to continue into the foreseeable future.This is particularly magnified in the light of the 18th anniversary of the handover, as well as the recent rejection of the pro-Beijing electoral reform package. But it was four years ago, in 2011, that Hong Kong’s voice took its first major, measurable shift in tone. According to the government’s census, Putonghua overtook English as the second most spoken language in the territory for the first time in 2011, with 48 percent of people claiming to speak the official language of mainland China, and 46 percent claiming to speak English. In the 2001 census, only a third of respondents could speak Putonghua.
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Jonathan Freedland’s new thriller The Third Woman is set in a future in which the United States is in thrall to China. Freedland told the Guardian newspaper that his new book was inspired by Martin Jacques’s bestselling When China Rules the World which, according to the review in the Guardian, argues that ‘China has no interest in moving towards western-style democracy. Rather, its economic power will grow as it learns to operate “both within and outside the existing international system… sponsoring a new China-centric international system which will exist alongside the present system and probably slowly begin to usurp it”’.
Al Jazeera’s most watched English-language programme is Head to Head. Hosted by Mehdi Hasan, who is also the political editor for the UK edition of the Huffington Post. It features Mehdi’s obstinate, in-your-face form of firebrand interviewing. He is immaculately researched and fiercely combative. Set in the Oxford Union, the surroundings seem almost at odds with the intention of making Mehdi’s guests squirm. Yet there is no end of very high-profile figures wanting to be on his one-hour show – especially intellectual figures who have achieved some public prominence. Bernard Henri Levy and Tariq Ramadan have been among his guests (or victims). Because public intellectuals take their turn alongside political figures, and because each interviewee is the centre of attention for an hour, Head to Head is probably the English-speaking world’s most sustained thinking person’s programme. The combat, in short sharp sound-bites, still allows more thought to be portrayed than any other programme. When Mehdi flags, he turns to three panellists who, in turn, ask questions of the guest. Mehdi might have moments when he can thus pause, but his guest cannot.
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The unhappiness with China among segments of Hong Kong society stems from the city’s failure to understand its privileged relationship with Beijing, prominent China expert Dr Martin Jacques said. In a wide-ranging interview with Celene Tan, the British-born author added that China has learnt from the past and will be patient in drawing Taiwan closer to the mainland. He also spoke about China’s territorial claims and President Xi Jinping’s anti-corruption campaign. Below is an excerpt of the interview, the first part of which was published yesterday.
As China takes on more global responsibilities, it is faltering in its effort to pull Hong Kong and Taiwan closer to the mainland. Why are the people in these two territories so resistant to China? How can they be swayed by Beijing?
Hong Kong had been under British rule for 155 years. The whole of Hong Kong’s modern experience was under British colonial rule, so it grew up, in a sense, deprived of its birthright, which was China, because it was cut off from China. It was brought up with a kind of adopted birthright, which was Britain, and looked West.
One-hundred-and-fifty-five years is a long time — many, many generations — so it’s left deep roots in the way in which Hongkongers see the world. They were very ignorant, by the end of British rule, about the country to their north. They were Chinese, but they knew very little about China. On the other hand, they were very knowledgeable, in many ways, about the world to their west, particularly Britain and, to a lesser extent, other countries in Europe and, of course, the United States.
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China has shown enormous capacity for reform in the past three decades without the need to move towards a Western-style system — a point greatly underestimated by the West, said prominent China expert Martin Jacques in a wide-ranging interview with TODAY’s Celene Tan this week. Dr Jacques also said that the Chinese Communist Party does not need economic growth to legitimise its rule and he believes China will grow to be a benign power. Below is an excerpt from the interview.
The latest issue of Foreign Affairs painted a picture of China as a country facing the classic challenges of the middle phases of development. It said China’s existing institutions may not be able to manage the country’s problems in the long term and Beijing seems unlikely to adopt the reforms that could help because they would threaten the Communist Party’s hold on power. What are your views on this?
China has done extraordinarily well over the past 35 years. It has shown an enormous capacity for reform, not only economic reform, but also political reform. Because if you’re growing at roughly 10 per cent a year, your economy is doubling its size every seven years. Now, more like every 10 years with the current growth rate. It’s impossible for the institutions to cope with this level of change without being constantly reengineered and reinvented. Generally, this has been greatly underestimated in the West. Foreign Affairs is a sort of journal of the United States foreign policy establishment — generally they don’t recognise this political reform because the only political reform they recognise is that which is moving China closer to the West. So, if it’s not doing that, then it’s not acknowledged, really.
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SINGAPORE — China’s rise has to be viewed with the right lens and many in the West fail to understand the Asian power because of a lack of knowledge of the country’s unique history and culture, said prominent China expert Dr Martin Jacques.
In an interview with TODAY, the British-born author said it is a mistake for the West to think that Beijing is unwilling to implement political reforms in its institutions simply because the reforms China has taken do not move towards a Western-style system.
Instead, China’s vast economic transformation in a mere few decades means that institutions in the country have been constantly re-engineered and reinvented to cope with the level of change, said Dr Jacques, whose book When China Rules The World has sold over 250,000 copies worldwide. “Generally, this has been greatly underestimated in the West — they don’t recognise this political reform (in China) because the only political reform they recognise is that which is moving China closer to the West,” he said.
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When the leaders of the member-states of the Association of Southeast Asian Nations (Asean) gather this weekend in Kuala Lumpur, their agenda will be dominated by the launch of the 10-year roadmap toward the realization of the Asean Community. But, apart from regional economic integration, President Aquino has other things in mind. The Asean summit offers him another opportunity to bring up the issue of China’s aggressive moves in the South China Sea. Hopefully, he will get his colleagues to conclude the protracted discussion of a Code of Conduct in the South China Sea as a concrete achievement in political and security cooperation.
This was an issue he first sharply brought to the Asean table at the 20th Asean summit in 2012 in Phnom Penh. For the first time in its history, the consensus-oriented regional bloc failed to issue a joint communiqué at the end of its meeting after the host country decided to take up the cudgels for China. This was a moment when semantics could not come to the aid of diplomacy.
That Cambodian summit conveyed in no uncertain terms P-Noy’s determination to hold China accountable for its actions under international norms. His dogged pursuit of the South China Sea issue at that meeting, which he did in the politest terms possible, deviated from the customary practice of issuing muffled official protests while signaling a readiness to settle disputes through bilateral talks. It was a sharp departure from the policy that had characterized his predecessor’s cozy relationship with China. Not too long after the Cambodian encounter, the Philippines filed an arbitration case against China under the terms of the United Nations Convention on the Law of the Sea (Unclos).
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