CRI 中国国际广播电台 2010-03-21

Broadcasting Time: 07:00-08:00, GMT+08:00, 2010-03-21

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

In This Edition

American Economists 2 attending the on-going China Development Forum 3 in Beijing say protectionism is not the way out of the Sino-US trade disputes.

"Red Shirt" demonstrators snake its way through the streets of the Thai capital to drum up support for their campaign to oust 4 a government they call illegitimate.

The start of a three-day strike by cabin crew at British Airways 5 spurs chaos 6 and passenger angst as the airways cancelled more than half of its 1,950 scheduled flights.

And China's leading economist 1 urges policymakers to encourage more state-run enterprises to join in market competition rather than participating too actively 7 in investment in the property market.

Hot Issue Reports

American Economists Say Protectionism Not a Way out of Sino-US Trade Disputes

American Economists attending the on-going China Development Forum in Beijing agreed that protectionism is not the way out of the Sino-US trade disputes.

At the 2010 China Development Forum on Saturday, Stephen Roach, Chairman of Morgan Stanley Asia said that decreasing the trade deficit 8 with China wouldn't really change the gloomy US job markets.

"This is truely a multilateral trade problem, not a bilateral 9 problem with China. In 2008, US ran trade deficits 10 with over 90 countries.If US politicians put sanctions on China, that's a worrisome and serious possibility. The Chinese deficit goes somewhere else and that continues put pressure on American jobs and consumers."

Roach points out America's excess consumption model is the key reason behind the large trade imbalance with China, and not because of Chinese currency issues.

In the same forum, Robert Kimmitt, Former Deputy Secretary of the U.S. Department of the Treasury 11 also called for more talks and negotiations 13 between China and the United States instead of politicizing, in order to solve trade disputes of the two sides.

"I think wether in a bilateral relationship or multilaterally , it's better to avoid the politics and instead focus on dialogue that will produce solutions for the interests of both countries and the global economy."

Sponsored by the Development Research Center under the State Council, or China's cabinet. The China Development Forum was founded in 2000. It aims to support and promote policy consultation 14 and academic research in China.

Officials, entrepreneurs, scholars and leaders from other nations, international and non-governmental organizations attended this year's forum themed China and the World Economy: Growth, Restructuring, Cooperation.

Vice 15 President's Four-Nation Visit to Promote Bilateral Ties

Chinese Vice President Xi Jinping arrived in Vladivostok Saturday to begin an official visit to Russia, Belarus, Finland and Sweden.

Prior to his departure, Freign Ministry 16 spokesman Qin Gang said China attaches high importance to relations with the four countries, which are developing satisfactorily, and this visit is an important diplomatic move by China this year.

"The Chinese vice president will meet with leaders of the four countries to discuss promoting bilateral relations and cooperation in such areas as finance, economy, energy and culture. The visit will further advance bilateral ties and promote cooperation with the four countries."

Russia is the first stop of the vice president's four nation tour. Recent years have seen frequent exchanges between the two countries' high level officials and considerable achievements in trade and economic cooperation. Since February last year, China has been Russia's biggest trading partner.

After his visit to Russia, the Chinese vice-president will also visit Belarus, Finland and Sweden. This year also marks the 60th anniversary of the establishment of China's diplomatic relations with Finland and Sweden.

Anti-government 'Red Shirts' Rally

Two small explosions hit the Thai capital Bangkok over the weekend. The event seemingly links to the country's ongoing 17 political battle.

Earlier, a crimson 18 tide of the "Red Shirt" demonstrators snaked its way through the streets of the capital, travelling in a caravan 19 of thousands of cars, trucks and motorbikes to drum up support for their campaign to oust a government they call illegitimate.

The protesters believe that Prime Minister Abhisit Vejjajiva came to power illegitimately with the connivance 20 of the military, courts and other parts of the traditional ruling class and that only new elections can restore integrity to Thai democracy.

Abhisit, however, shrugs 21 off the mass rally.

"Each side, each political party has a lot of support. The issue is not about showing numbers or strength in some kind of demonstration 22. The issue is about how we resolve the differences to the best interests of the country."

The government's attempts to start a dialogue with the demonstrators have so far made no progress, though Abhisit is offering to send representatives to talk with the protest leaders early next week.

Quartet Urges Israel to Drop Planned Construction in East Jerusalem

The Quartet peacemakers in the Middle East have called on Israel and the Palestinians to return to peace negotiations that aims to reach a final settlement that would create an independent Palestinian state within 24 months.

Diplomats 23 from the Quartet, which is made up of the UN, the US, the EU and Russia, issued a formal statement read by UN Secretary General Ban Ki-moon in Moscow.

"The Quartet urges the Government of Israel to freeze all settlement activity, and to refrain from demolitions 24 and evictions in East Jerusalem. The Quartet also calls on both sides to observe calm and refrain from provocative 25 actions, especially in areas of cultural and religious sensitivity."

Although the Quartet reiterated 26 their condemnation 27 of Israeli plans to build news settlements in disputed east Jerusalem, they did not escalate 28 their criticism of Israel.

Israel plans to build 1,600 apartments for Jews in east Jerusalem, which has caused one of the most serious rifts 29 between Israel and Palestine in decades.

Brown Urges Enhanced International Cooperation in Make-or-Break Year

British Prime Minister Gordon Brown is urging governments around the world to strengthen cooperation in implementing 30 international agreements. He calls 2010 a make-or-break year in tackling a number of global challenges. Our London correspondent Tu Yun reports.

Light News

Thousands of Flights Cancelled as UK Cabin Crews Strike Adds Reaction

The start of a three-day strike by cabin crew at British Airways spurred chaos and passenger angst on Saturday, as the airways cancelled more than half of its 1,950 scheduled flights over the period.

Assistant general secretary of the Unite union, Len McCluskey, said it was "a sad day".

"We can only wait for the British Airways management to get the message that our cabin crew have a deep sense of grievance 31 and, as we've said all along, it can only be resolved through negotiation 12."

At its Heathrow base, more than 60 percent of long-haul flights were operating, but only 30 percent of short-haul.

The strike would likely last several days beyond the three-day strike, as the Unite warned a second strike for March 27-30.

Any passengers with cancelled flights from Saturday through the end of the second planned strike on March 30 will be allowed to rebook on another BA flight within 355 days at no extra charge, but no refunds 32 were being offered, the airline said.

British Airways' cabin crew are disputing a pay freeze and changes to working conditions. Their Unite union also says the company didn't inform it of cost-cutting plans. The airline on Friday offered a compromise on a proposed pay freeze this year, but it was rejected by the Unite.

Rescue Plan for Greece to Come Soon

Olli Rehn, the EU's economic and monetary 33 affairs commissioner 34, stated on Friday that the EU would deliver a detailed 35 plan to rescue indebted Greece in the upcoming week.

Rehn told the media that EU members would soon reach a concrete political agreement concerning how to bail 36 out Greece. He also stressed that EU should shoulder major responsibilities in curbing 37 Greece's debt crisis.

"The IMF and us are cooperating very well. But as far as the euro-area country is concerned, the EU should take the lead in solving the debt problem."

The EU's foot-dragging on the matter led to Greek Prime Minister Andreas Papandreou signaling on Thursday the possibility of resorting to the IMF for help, a potentially embarrassing move for the EU.

The Greek debt crisis has been lingering for some time. The country's fiscal 38 deficit and public debt of 2009 far exceeded the upper limits set by the EU, triggering the downgrading of Greek sovereign debt. As a result, it became increasingly expensive for Greece to finance itself. Little wonder that the country is now staring bankruptcy 39 in the face.

Top Economist Says State-run Enterprises Need to Withdraw from Property Market

China's leading economist Wu Jinglian urges policymakers to encourage more state-run enterprises to join market competitions rather than participating too actively in investment in the property market.

Wu's comments were made in Beijing on Saturday during an annual economic development forum organized by the State Council.

Wu Jianglian says many Chinese state-run enterprises usually don't feel strong pressures from market competitions, so they invest quite a lot in the property market. This partly has caused rising land costs and asset bubble concerns.

"Our state-run enterprises invest too much in the property market rather than focusing on innovation. It naturally leads to potential asset bubbles."

On Thursday, some 80 state-run enterprises were ordered to withdraw from asset investments gradually, the specific timeline however, is not clear.

The leading economist suggests the central government should form an economy which is mainly driven by innovation and self-entrepreneurship during the country's ongoing economic restructuring.

"In order to advance the economic restructuring, the country needs a reasonable macro-economic policy and an environment that could effectively nurture 40 innovation and self-entrepreneurship."

Pan-Africa Media Conference Discusses the "Africa Promise"

The media in Africa is tasked with telling the rest of the world the story of the continent. For a period of at least 50 years, during which many African countries attained 41 independence, the media has been at the forefront of reporting on the economic, political and social progress of Africa.

A Pan-Africa Media Conference is currently underway in Nairobi with the theme of "Media and the Africa Promise."

Media Digest

China Daily: Real Estate Giants Risk Blowing Bubbles

This week,two records were broken within one day in Beijing's real estate market. First, the highest per-square-meter price the city has ever seen of 27,000 yuan was paid for a plot in the Chaoyang district that went for a total of 4.08 billion yuan, or 769 million U.S. dollars. But that was nothing compared to another plot of land in Daxing district that was snapped up later in the day for a record 5.25 billion yuan. The buyers were a real-estate company belonging to CITIC Group, the state-owned investment company, and real-estate developer Sino-Ocean.

In spite of all the Chinese government's tough talk against excessive home price hikes, the record land price for residential 42 housing in Beijing was broken twice thanks to aggressive bids by these two State-owned enterprises.

An editorial in China Daily argues that the unchecked surge of real estate investment by large State-owned enterprises, SOEs, not only sabotages 43 the central government's efforts to prevent housing bubbles but raises questions about SOEs themselves.

These land auctions 44 seem to underline the urgency of tackling a potential housing bubble, as many policymakers warned about during the recent meeting of the National People's Congress.

Yet the jaw-dropping prices paid by cash-rich state firms only go to underscore the difficulty in tackling this issue.

It seems that all the measures the government has adopted to raise capital requirements and leverage 45 restrictions 46 have so far worked only to discourage private property developers while doing little to restrain the appetite of State firms for a bigger market share.

The record land sales this week certainly cast doubts on a previous official claim that not a single cent of the country's 4-trillion-yuan stimulus 47 package has flowed into the real estate sector 48. Worse still, they have fueled expectation of further price hikes undermining government efforts to prevent a housing bubble.

The editorial suggests that Chinese policymakers should act immediately to bridle 49 these new giants who are stirring up more trouble in the overheated property market.

The hunger for profit shown by SOEs also calls for a review of their actual role in the economy. A profit-driven company does not deserve the monopoly status that SOEs have required for the "strategic roles" they are supposed to play in the national economy.

South Weekend Paper: China's New Wealth Should be Shared with People

The Chinese government's tax revenue has been steadily 50 increasing in the past years. The government fiscal surplus had received nearly 850 billion yuan in the first ten months of 2009. At the end of that year, the appropriation 51 budget even reached 2 trillion yuan.

A commentary in China's South Weekend newspaper argues that it is incomprehensible that policymakers, financial media, and many Chinese economists are still pursuing proactive fiscal policies in 2010. The writer argues that it is incredible that expansive fiscal policies are still being taken in the wake of such a huge economic crisis.

The article points out that the increase of government tax revenue doubled and even trebled GDP growth in the past 15 years. The share of fiscal revenue is growing rapidly while people's disposable income shrinks constantly.

This is why domestic consumption is always a small percentage of GDP.

Such a situation risks many un-harmonious social problems such as increasing the deep gap between wealth distribution, and official corruption 52 that can negatively influence long-term economic growth.

The commentary suggests that the commonly held belief, especially among local government officials, that increased tax revenue is a good thing needs to be changed. Tax revenue, the article says, has a negative effect on long-term economic growth.

China should strive to achieve the common goals of sharing the country's newly generated wealth with the people.

It is the citizens of China that need to share this benefit through tax cuts and more government expenditure 53 on medical insurance, social security and other public services.

The article also points out that Chinese government levies 54 are unbound by rule of law in addition to unpublished government expenditures 55. It suggests introducing new levies in democratic social surroundings such as amending 56 the budget law.