China Confidential
Monday, December 08, 2008
China Plans to Invest $22 Billion in Shanxi Railroads
China plans to invest $22 billion to build more railways in the coal-rich northern province of Shanxi as part of a bid to ease chronic congestion and promote domestic growth in the face of the global economic slowdown, state media reported Sunday.
China is in a railway-building boom, adding hundreds of miles (kilometers) of track each year in an expansion that rivals the construction of railroads in the 19th century American West.
Ramping up construction can help create jobs at a time when the country's economic boom appears to be stalling, with growth expected to slow this year to about 9 percent, down from last year's 11.9 percent.
Expanding the rail system will also help alleviate severe bottlenecks, especially for transport of the coal that is used to generate three-quarters of China's electricity supply.
- AP
# posted by Confidential Reporter @ 12:51 AM 
China Poised to Cut Income Tax as Economy Cools
Paul Panckhurst reports:
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Chinese leaders, holding their annual economic meeting in Beijing from today, may cut personal income tax as a deepening slowdown encourages more measures to boost consumption and growth.
The central economic work conference runs for three days and will set the tone for policy next year, according to state media.
“It’s almost a done deal that the conference will put the final seal on raising the threshold for personal income tax,” said Kevin Lai, senior economist at Daiwa Institute of Research in Hong Kong. “That’s positive of course, positive for consumption.”
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# posted by Confidential Reporter @ 12:45 AM
Foreign Speculators Leaving China
Leslie Norton reports for Barron's"
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Last week, China's currency, the renminbi, juddered to its biggest one-day decline against the greenback since Beijing began a managed float in 2005.
Says Win Thin, a currency economist at Brown Brothers Harriman: "The prospect of appreciation is off the table for now." Morgan Stanley now expects China to depreciate its currency by 5% to 10% in the coming year. The current rate is 6.88 to the dollar.
The renminbi can float in a trading band of 0.5% on either side of the U.S. dollar and has gone up 20% against the buck in the past three years. To trim China's fat trade surplus with the U.S., Treasury Secretary Henry Paulson is pushing for further appreciation, and the Obama administration will probably hew to the script.
The dollar's recent jump has pulled the renminbi up sharply against the euro and the currencies of Korea, Taiwan and Indonesia. That's bad news for China. Its exports account for just 8.8% of GDP, but nearly 20% of growth. Now, China is slashing rates and spending $586 billion to stimulate its economy. Last month, Brown Brothers notes, People's Bank of China Gov. Zhou Xiaochuan said he couldn't rule out weakening the renminbi to boost the economy.
Long-term, the renminbi may revive, especially if Beijing ever lets it float freely. Right now, at the very least, it's no longer a one-way trade. That's likely to dampen foreigners' interest in Chinese real estate and equities -- both formerly beloved by speculators.
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# posted by Confidential Reporter @ 12:39 AM
Sunday, December 07, 2008
'Made in China' Scares Consumers
Ben Blanchard reports from Beijing:
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Milk, toothpaste, cough syrup, pet food, eels, blood thinner, car parts, pork, eggs, honey, chicken, dumplings, cooking oil and rice -- if you can fake it or taint it, you can almost guarantee it's happened in China.
A string of product safety scandals, including contaminated infant formula that is believed to have killed six babies and sickened thousands of others, have rocked the faith of shoppers, making them wary of buying products made in China despite the often cheaper price tag.
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# posted by Confidential Reporter @ 11:59 PM
Chicago Factory Sit-In Draws International Support
Dateline USA....Chicago workers in the third day of a sit-in on the floor of their former workplace peered through the windows of a door Sunday, amazed by a mix of supporters, politicians and journalists who packed a foyer outside.
"We never expected this," said Melvin Maclin, a factory employee and vice president of the local union that represents the workers. "We expected to go to jail."
The 200 workers demanding severance and vacation pay have become a national symbol for thousands of employees laid off nationwide as the economy continues to sour. They occupied the plant of their former employer, Republic Windows and Doors, after the company abruptly fired them last week.
At a news conference Sunday, President-elect Barack Obama said Republic should follow through on its commitments to its workers.
"The workers who are asking for the benefits and payments that they have earned, I think they're absolutely right and understand that what's happening to them is reflective of what's happening across this economy," Obama said.
The Rev. Jesse Jackson delivered turkeys to the workers, pledging the support of his Chicago-based civil rights group, Rainbow/PUSH Coalition.
"These workers deserve their wages, deserve fair notice, deserve health security," Jackson said. "This may be the beginning of long struggle of worker resistance finally."
Leah Fried, an organizer for the United Electrical Workers union that represents the workers, said the company told the union that Bank of America has canceled its financing.
Bank of America received $25 billion as part of a government bailout. Some workers carried signs Sunday that said: "You got bailed out. We got sold out."
The bank had said in a statement Saturday that it wasn't responsible for Republic's financial obligations to its employees. Republic has not commented on the sit-in.
One of the factory's workers, Silvia Mazon, said in Spanish that she needs the money owed to her for an $1,800 monthly house payment. The 40-year-old from Cicero said she has enough money saved to survive for one month.
"We're making history," she said.
Patrick Tyrrell, 22, of Chicago, visited the workers Saturday and returned the next day with home-cooked beans, rice, chicken and soup. Tyrrell said he felt he wanted to help, in part, because his grandfather was an electrical union member.
"This is an impressive historical event," he said.
Rep. Jan Schakowsky, an Illinois Democrat, called it the start of a movement. "This story has resonated around the world," she said.
- AP
# posted by Confidential Reporter @ 10:04 PM
Genocide Continues in Darfur
Foreign Confidential....
Darfur ends 2008 more dangerous than ever with a much vaunted UN mission unable to protect civilians and a possible war crimes indictment against Sudan's president casting a pall over 2009.
Huge hopes 12 months ago that the United Nations could bring some measure of stability to the western Sudanese region by assuming control of peacekeeping have been largely disappointed as the mission struggles to find its footing.
"Genocide continues" was the blunt if controversial verdict this week from International Criminal Court prosecutor Luis Moreno-Ocampo, who is seeking an arrest warrant against President Omar al-Beshir over the six-year conflict.
Insecurity has spiralled as the war, which erupted in 2003 when Darfur rebel groups rose against Arab-led government in Khartoum, mushroomed into a complex web of violence between myriad groups and also marred by widespread banditry.
What was to have been the world's largest UN-led peacekeeping force became operational last December 31, but by the end of November it had deployed just 12,163 troops and police, less than half its total planned strength of 26,000.
Fighting and Bombing
An "unconditional" ceasefire declared by Beshir in November as part of diplomatic efforts to stall international legal moves against him was dismissed by rebels as disingenuous propaganda, and fighting and bombing has continued.
"Millions of people are living under daily threat of violence and are dependent on humanitarian aid that is hindered or entirely blocked by ongoing insecurity and endless bureaucratic hurdles," said Julia Fromholz, director of the Crimes Against Humanity Programme at Human Rights First.
UN officials estimate that since 2003 up to 300,000 people have died and 2.7 million have fled their homes. They say 4.7 million people are getting aid in the world's biggest relief effort, set to cost one billion dollars in 2009.
Nearly 310,000 civilians have been displaced this year, UN officials add.
The Sudan government has been heavily criticised in the West for brutally trying to suppress the uprising and unleashing Arab proxy militias, but insists the death toll stands at 10,000 and dismisses other statistics as a conspiracy.
Daily Attacks
Aid workers come under near daily attack, mostly from bandits and rebels, and in some areas have incurred increasing restrictions from the authorities, with the quality and quantity of aid delivered suffering as a result.
Insecure roads and expensive air travel have also forced cuts in food aid.
In the first nine months of 2008, 11 aid workers were killed and humanitarian premises attacked or broken into 144 times, compared with 93 last year. The UN says it has humanitarian access to just 65 percent of the region.
The UN-led peacekeeping force lacks its quota of 24 helicopters to cover a region larger than France. Patrols are far from regular in all areas, and civilians say peacekeepers cannot protect themselves, let alone others.
Eleven UN troops have been killed, including seven in a July ambush that prompted the mission to boost security levels.
The force was criticised for standing back in August when 33 people died during a government raid on Kalma, Darfur's biggest camp for the displaced.
Some Hope
There is some hope that a stronger UN peacekeeping force -- the UNAMID hybrid mission with the African Union -- will emerge in 2009.
An initially reluctant Sudan is cooperating fully over UNAMID deployment. In some areas, regular patrols have made civilians feel more secure and improved access for aid workers. And UNAMID now has a 24-hour police presence in Kalma.
In May, the Justice and Equality Movement attacked Khartoum, the first time regional rebels have ever approached the seat of power, and although they were defeated the brazen assault humiliated Sudan's army.
Then in July, the ICC's Moreno-Ocampo demanded an arrest warrant against Beshir on 10 counts of war crimes, crimes against humanity and genocide.
Judges are expected to make a decision in early 2009 on whether to issue what would be the first ICC warrant for a sitting head of state.
Some say a furious Sudan will evict peacekeepers and aid workers, torpedoing hopes of resolving the conflict, jeopardising a 2005 peace agreement between north and south Sudan and compromising the path to elections in 2009.
Others believe the Khartoum regime will use diplomacy to stay in power and convince the United Nations it is serious about a solution in Darfur.
Efforts to resolve the conflict, stalemated throughout 2008, have shown signs of picking up with a new international mediator on Darfur and the Gulf state of Qatar also keen to host talks.
But the omens remain murky. The rebels are fragmented and their incentive to negotiate with a would-be indicted war criminal president unclear.
"It hasn't got any closer, if anything it's been receding," said Sudan expert Alex de Waal, referring to prospects of a negotiated peace.
"If the referendum on self-determination goes ahead in south Sudan in two years' time and the south separates, I think then we're in for another five years of indeterminacy in Darfur, so I think it's a very, very long way away."
- AFP
# posted by Confidential Reporter @ 9:48 PM
This Jew Says God Bless Saudi Aramco
Foreign Confidential....
Oil is a gift from God.
Recovering oil is the work of men.
- Abdallah S. Jum'ah, President and Chief Executive Officer,Saudi Aramco, interviewed on 60 Minutes, December 7, 2008
Oil made modern civilization possible. The world runs on oil and will continue to run on oil for at least the next 20 years. There is no alternative to oil; anyone who tells you otherwise is an energy ignoramus or an energy faker.
Saudi Aramco is the world's largest, most profitable, and advanced oil company. Its health and well being is important for the global economy.
Saudi Aramco's astonishing achievements, as shown on CBS-TV's 60 Minutes, should inspire the United States to develop its own abundant energy resources, including: offshore oil; North Dakota (Bakken Formation) oil; heavy oil; enhanced recovery oil--producing new oil from oil fields--natural gas, more of which is constantly being discovered; clean coal liquefaction; and, yes, shale--squeezing oil from rocks.
The spectacular success of Saudi Aramco, which, in line with Saudi Arabian oil policy, is committed to responsible production and pricing policies, should be celebrated. It is a tribute to human intelligence and ingenuity.
U.S. oil will never be as cheap as Saudi oil. And energy independence, as opposed to energy security, may be an unrealistic goal. But that doesn't mean that US oil should be neglected--or despised because it is a so-called fossil fuel.
God bless fossil fuels. Where would the world be without them?
With all due respect to President-elect Obama, the very notion of an oil addiction is stupid and counterproductive. Instead of hating oil, the U.S. should embrace it, appreciate it, develop it ... even if that means creating a national oil company .... an American counterpart to Saudi Aramco .... to develop resources that are profitable but perhaps not profitable enough for U.S.-based, publicly traded, private-sector, multinational oil companies (especially since a combination of bad public policy and indifference has essentially eradicated the nation's domestic, independent oil industry).
Nothing would stimulate the economy more ... nothing would create more jobs and more wealth and value in society ... than a U.S. national oil company.
Meanwhile, this American Jew says: thank you, Saudi Aramco! Thank you for being a good global citizen--and a good friend to the United States.
Inshallah, we shall all see better days.
# posted by Confidential Reporter @ 7:58 PM
Iran Test-Fires New Missile From Warship
Foreign Confidential....
Islamist Iran has sent an ominous signal to President-elect Obama.
Reuters reports:
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Islamist Iran has sent an ominous signal to President-elect Obama.
Reuters reports:
Iran's military test-fired a new surface-to-surface missile from a warship as part of exercises along a strategic shipping route, state media reported on Sunday.
Iran launched six days of naval war games on Tuesday in the Sea of Oman and the Gulf region amid tension with the United States and Israel, which have not ruled out military action if diplomacy fails to end a row over Tehran's nuclear work.
Iran has said that, if pushed, it could close the Strait of Hormuz at the entrance to the Gulf and through which about 40 percent of the world's traded oil passes.
"The surface-to-surface Nasr-2 missile was tested in the (Sea of) Oman operational region," state radio reported, adding that the test took place on Saturday.
"The Nasr-2 was fired from a warship and hit its target at a distance of 30 km (19 miles) and destroyed it," the official news agency IRNA said, adding it was the first test of the new, medium-range missile.
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# posted by Confidential Reporter @ 6:27 PM
America's Cruelest or Dumbest TV Anchor
Dateline USA....
His name is Tom Brokaw. On Sunday's Meet the Press he suggested to his guest, President-elect Barack Obama, that now is the time to burden Americans with a fuel tax to drive the price of gasoline back up to $4 a gallon, which, Brokaw asserted, astonishingly, most Americans were prepared to pay.
Fortunately for the nation, which is in the grip of a worsening recession--probably the beginning of a depression-- Obama politely but firmly rejected Brokaw's cruel and idiotic idea.
# posted by Confidential Reporter @ 10:16 AM
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