News & Reports 2011-07-16

 Hello and Welcome to News and Reports on China Radio International.

 
In This Edition
 
Chinese experts express concerns over a possible new round of quantitative 1 easing monetary 2 policies by the United States.
 
US attorney-general says investigation 3 is ongoing 4 into Rupert Murdoch's News Corp following the phone hacking 6 scandal.
 
China announces the second batch 7 of rare earth export quotas 9 for this year which double the corresponding caps set last year.
 
The newly launched Beijing-Shanghai High-Speed Rail faces questions after a series of technical breakdowns 10.
 
 
Hot Issue Reports
 
Talks on US National Debt Ceiling and QE3
US President Barack Obama is facing growing pressure over how to avoid a U.S. debt default as an August 2nd deadline looms 11 for raising the national debt ceiling.
 
US Federal Reserve Chairman Ben Bernanke warns of economic damage if the national debt limit wasn't raised.
　
"Mr. Chairman, as I've said on a number of occasions I think it would be a calamitous 12 outcome, it (referring to US default) would create a very severe financial shock that would have effects not only on the US economy but on the global economy."
 
China, the U.S.'s biggest foreign creditor 13 with more than $1 trillion US dollars in Treasury 14 debt as of March, calls on the U.S. government to adopt responsible policies to protect investor 16 interests.
 
The rating agencies Standard & Poor's and Moody's Investors 17 Service both warn to downgrade U.S.'s credit ratings if policy makers 18 failed to reach a deal to raise the government's debt ceiling.
 
Meanwhile, Bernanke says a third round of quantitative easing, called QE3, could be necessary if the economy failed to regain 19 momentum 20 in the second half of the year.
 
The US government will run out of money to pay its bills and default on some obligations if no agreement is reached on raising America's debt limit by the early August deadline.
 
For more on this, our reporter Ding Lulu spoke 21 with Mr. Zha Xiaogang, research fellow for Shanghai Institute for International Studies.
 
Libyan Government Spokesman: To Do Everything to Defend Oil
Moussa Ibrahim, spokesman for the Libyan government, says they will do everything to defend the country's oil and land.
 
"We will die for oil, and we will kill for oil … have your big headline, make it as sensationalist as you want, we will kill we will die for oil."
 
Ibrahim says Libyan army defended the oil coastal 22 town of Brega in the east after a coordinated 23 attack by NATO and rebels.
 
Earlier Al-Arabiya television said Libyan rebels helped by NATO warplanes attacked the town from land and sea.
 
"It was full scale attack, it was heavy, merciless and surprising as well .. But because our army is professional and we are completely controlling Brega city, we were able to combating this attack and we did defeat both NATO and rebels."
 
The spokesman also denied reports that Libyan leader Muammar Gaddafi has any plans to blow up Tripoli if it falls to rebels.
 
Meanwhile, thousands of Gaddafi's supporters have rallied in al-Ajaylat, west of Tripoli.
 
Gaddafi addressed the crowds in an audio speech and vowed 24 to continue fighting until the end.
 
Elsewhere in Turkey, top NATO and Arab diplomats 25, including U.S. Secretary of State Hillary Clinton, gathered to discuss a political solution to the crisis in Libya.
 
Forging a common stance on how to best assist the Libyan rebels and hasten the departure of Gaddafi is likely to be the main objective of the meeting.
 
US Attorney-general: Investigation Begins into News Corp
Rebekah Brooks 26 has resigned as chief executive of Rupert Murdoch's embattled British newspapers. She is the biggest casualty so far in the phone hacking scandal that has rocked British politics and media.
 
Murdoch had defended Brooks in the face of demands from politicians that she step down, and had previously 27 refused to accept her resignation.
 
Brooks was editor of the now closed News of the World between 2000 and 2003, the time of the most explosive allegation to hit Murdoch's News Corp. empire.
 
Meanwhile, the U.S. Attorney-General Eric H. Holder 28 says investigations 29 are progressing into the U.S. operations of News Corp.
 
The US Federal Bureau of Investigation said it's looking into allegations that News Corp. tried to hack 5 into the phones of 9/11 victims.
 
"While there have been serious allegations raised in that regard in Great Britain and there is an ongoing investigation there, as is appropriate, there have been members of Congress in the United States that have asked us to investigate those same allegations and we are progressing in that regard, using the appropriate federal law enforcement agencies in the United States."
　　
Meanwhile, Rupert Murdoch and his son James have now agreed to appear before U.K. lawmakers investigating phone hacking and police bribery 30.
 
China Raises Rare Earth Export Quota 8
Chinese authorities have announced the second batch of rare earth export quotas for this year, totaling 15,738 tons.
 
The quota is almost double the corresponding caps set last year.
 
CRI's Damin has the details.
 
The announcement of the quotas coincides with China-EU trade talks in Beijing, and comes just a week after the WTO ruled against Chinese export curbs 31 on nine raw materials.
 
Some have argued that the ruling has prompted both European and US officials to call on the Chinese side to increase its rare-earth exports.
 
But Chinese Commerce Minister Chen Deming says he is not concerned about any possible WTO challenge to China's rare earth restrictions 32.
 
"WTO hasn't made any rulings against the rare earth issue. It actually hasn't even entered the WTO stage. They are only suggestions from some experts and they are of two sides, both agreed and disagreed. I am not worried because we have already had some negotiations 33."
 
China reduced export quotas for the first batch of rare earth this year by 11 percent in a bid to secure the sustainable development of the industry.
But the total export quotas for the whole year remain the same level as last year.
 
China produces more than 90 percent of the world's supply of rare earth, even though it has just 36 percent of global reserves.
 
While rare-earth extraction can be lucrative 34, it is also seen as particularly harmful to the environment.
 
Yao Jian, spokesman for the Ministry 35 of Commerce, says China will make more efforts to better regulate its rare earth industry.
 
"As it known to all the export of rare earth is not isolated 36. It connects with the mining, smelting 37 and production of the mineral. We will further standardize 38 the export of rare earth by applying a set of environmental and smelting standards to export enterprises. Also, we aim to achieve a balance between domestic rare earth production, consumption and its export."
 
Insiders estimate that China produced more than 120,000 tons of rare earth last year. Among them 34,600 tons are used for export.
 
Rare earth, a group of 17 minerals, are vital for the industries of high-end electronics, defense 39 and renewable energy.
 
For CRI, I'm Damin.
 
China to Release Pork Reserves
China's Ministry of Commerce says that it will release some pork reserves onto the market to blunt a sharp rise in pork prices.
 
The Ministry of Commerce spokesperson Yao Jian says the government will release some stocks held by the central and local governments "in a timely fashion."
 
The moves come after pork prices reached record levels last month, rising 57% from a year earlier.
 
"Currently, China's central pork reserves stand around 200,000 tons. As people's livelihood 40 improves, the central reserves are planning to boost stocks from current levels at a gradual pace. China's pig population is has been rising from 2008 to 2010. But consumption of pork is increasing as well, this poses new challenge for market regulation."
 
Analysts 41 say they expect rising pork prices are the result of a dwindling 42 pig population culled 43 by swine flu in 2009 and foot-and-mouth disease last year.
 
Break-downs Means Safer System? High-Speed Rail Facing Questions in China
The over 300 kilometer per hour Beijing-Shanghai high-speed train was officially put into operation on July 1st with high expectation from the public. Airlines linking the two cities have cut their prices to retain their passenger. However, in the past week, the train has broken down four times in total.
 
In addition to apologies from the Railway Ministry, some technology specialists involved in the project have also admitted that they still need to improve some aspects of the new train to regain the public's confidence.
 
Liu Min has more.
 
Due to a rainstorm in Tengzhou on July the 10th, a city along the Beijing-Shanghai high-speed line, electricity to the line was shut down, causing the train to be delayed by two hours.
 
The other three accidents, which occurred once on the 12th and twice on 13th of July. The accidents were related to power outage and transformer problems of the train.
 
Professor Sun Zhang is from the Urban Rail Traffic Research Center at Tongji University in Shanghai. He participated in the feasibility studies for the High-speed railway project. He says that the safety of passengers can be assured because the high-speed train can automatically detect malfunctions 44 and slow down.
 
"The technology involved means that malfunctions lead to a safe shut down. The break-down on the 13th of July is one example. Sensors 45 have been installed in different parts of the train. Whenever they detect irregularity in operation, the data will be sent to the main computer control system. Then the train will slow down or even comes to a complete stop automatically."
 
Currently, there are 105 new high-speed trains running on the line heading in both directions, all of which are still in the adjustment period.
 
Similar to the high-speed trains in other countries, these trains also have sensors detecting the speed of the wind and the volume of rainfall. The sensors usually send the data back to the control center. But the communications between the control center and the staff on the train is not smooth, meaning the staff on board the train sometimes feel embarrassed when explaining to the passengers what has happened exactly. Sun Zhang further explains how such sensors work.
 
"When the sensors find an accumulation of rain exceeding 150 millimeters within a period of 24 hours, the train automatically stops. When the wind speed reaches 25 meters per second, the train starts to slow down to a speed of 70 kilometers per hour, and when the wind speed escalates 46 to 30 meters per second, which is equal to grade 12 winds, then the train comes to a complete stop."
 
Many passengers complained that during the two hour train delay, air-conditioners all stopped running, and the whole carriage went completely dark, leading to a cramped 47 and stuffy 48 environment.
 
Some reports have indicated that the recently launched high-speed rail line has greatly reduced the number of passengers using the corresponding airline routes. The flights between Changzhou and Beijing have seen their passenger numbers reduced by half.
 
The frequent accidents on the high-speed rail line however, have driven some business back to the airlines.
 
The railway authorities explaines that the breaksdown is mainly due to the high standard safe mode adopted by the high speed line. However, one commentary from Xinhuanet.com points out, for common travelers, while a safe journey is always the priority, punctuality is also very important.
 
For CRI, I'm Liu Min.
 
Chinese Firms Still Battling Abroad
Recent surveys by the European and American Chambers 49 of Commerce show many multinational 50 firms operating in China believe they face unfair competition with domestic firms. Yet these firms are far more successful here than Chinese companies operating in developed markets. This has produced an imbalance in investment, provoking debate about future trade problems. CRI's Dominic Swire takes a closer look.
 
Lunchtime in a well-known American fast food restaurant in Beijing. Business certainly seems to be booming. But many foreign firms still complain about unfair competition with Chinese companies.
 
John Russell is managing director of Northhead, a PR consultancy operating in Beijing. He acknowledges running a business in China is not easy but says Chinese firms operating abroad face even greater challenges.
 
"What we are also seeing on the other hand are the challenges for Chinese companies entering developed markets, be it the US or the EU, are significant also. In fact the barriers seem to be even higher and the challenges even more daunting 51."
 
One of the biggest obstacles is image. Jo Eatwell is from Chinese branding firm Shishi Ishi, based in London. She says China's image in the west is better than it used to be but still needs to improve.
 
"to distinguish 'made in China' and a Chinese brand compared to a brand from Japan, Singapore, Malaysia and so on, we need to come up with a sharper edge to bring out this image. At the moment this edge is still not so clear."
 
Not many Chinese brands are known abroad. But for foreign firms in China, it's a different story. As a result, discounting investment in bonds, there's much more money coming into China from developed nations than leaving it. In 2008, 4.5 billion euros was invested in China from the EU, but less than one percent of that figure went the other way. John Russell from Northhead again.
 
"What we're seeing from an investment point of view is an asymmetry 52 and lack of balance between American investment in China, European investment in China and Chinese investment into both of those mature markets."
 
John Russell says correcting this imbalance could rely on many factors such as foreign countries opening to more investment, or Chinese firms improving competitiveness. But he warns of future trade disputes if politics enters the picture.
 
"Within trade and investment, there's always been a dynamic of quid pro 15 quo. And the last factor I'd identify is where there's more pressure from the Chinese government. Particularly pressure on multinationals 53 in China: 'Why should you be allowed to prosper 54 and be profitable here when our economic operators cannot invest or prosper in your own country or the EU region?'
 
But not all are so pessimistic. Professor Zhao Zhongxiu is an expert in foreign trade at Beijing's University of International Business and Economics.
 
"I don't think the government will do this. I think the government will maintain a fair environment for the competition, I don't think the government will help to do this. Firms need to build their own competence 55, not just basing this on the support of the government."
 
Chinese firms do appear to be making progress internationally. Market research firm Millward Brown says 12 of the 100 most valuable global brands are now Chinese. That's compared to just 3 from Brazil.
 
But for now Chinese consumers still love their American fast food.
 
For China Radio International, I'm Dominic Swire.
 
Newspaper Picks
 
Xinhua: New government guidelines here in China are being put in place to ensure there is one healthcare clinic for each village or a countryside doctor for every 1-thousand farmers, in the governments bid to improve rural health care services. According to Xinhua, they want to roll this out to all rural areas of China by the end of this year. This comes as good news for people living out in these areas as they have long had to make do with so called 'barefoot' doctors who have traditionally been unlicensed doctors only able to treat common illnesses. They also plan to ensure countryside doctors are trained well and have pension plans in place.