China, Russia sound alarm on world economy at APEC summit

By Timothy Heritage

VLADIVOSTOK, Russia

(Reuters) - China and Russia sounded the alarm about the state of the global economy and urged Asian-Pacific countries at a summit on Saturday to protect themselves by forging deeper regional economic ties.

Chinese President Hu Jintao said Beijing would do all it could to strengthen the 21-member Asia-Pacific Economic Cooperation (APEC) by rebalancing its economy, Asia's biggest, to improve the chances of a global economic recovery.

Russian President Vladimir Putin said trade barriers must be smashed down as he opened the APEC summit which he is hosting on a small island linked to the Pacific port of Vladivostok by a spectacular new bridge that symbolizes Moscow's pivotal turn to Asia away from debt-stricken Europe.

"It's important to build bridges, not walls. We must continue striving for greater integration," Putin told the APEC leaders, seated at a round table in a room with a view of the $1 billion cable-stayed bridge, the largest of its kind.

"The global economic recovery is faltering. We can overcome the negative trends only by increasing the volume of trade in goods and services and enhancing the flow of capital."

Hu told business leaders before the summit the world economy was being hampered by "destabilizing factors and uncertainties" and the crisis that hit in 2008-09 was far from over. China would play its role, he said, in strengthening the recovery.

"We will work to maintain the balance between keeping steady and robust growth, adjusting the economic structure and managing inflation expectations. We will boost domestic demand and maintain steady and robust growth as well as basic price stability," he said.

Hu spelled out plans for China, whose economic growth has slowed as Europe's debt crisis worsened, to pump $157 billion into infrastructure investment in agriculture, energy, railways and roads.

Hu steps down as China's leader in the autumn after a Communist Party congress, but he promised continuity and stability for the economy.

Putin, who has just begun a new six-year term as president, said on Friday Russia would be a stable energy supplier and a gateway to Europe for Asian countries, and also pledged to develop his country's transport network.

RUSSIA LOOKS EAST

The relative strength of China's economy, by far the largest in Asia and second in the world to the United States, is key to Russia's decision to look eastwards as it seeks to develop its economy and Europe battles economic problems.

APEC, which includes the United States, Japan, South Korea, Indonesia and Canada, groups countries around the Pacific Rim which account for 40 percent of the world's population, 54 percent of its economic output and 44 percent of trade.

APEC members are broadly showing relatively strong growth, but boosting trade and growth is vital for the group as it tries to remove the trade barriers that hinder investment.

The European Union has been at odds with both China and Russia over trade practices it regards as limiting free competition. Cooperation in APEC is also hindered by territorial and other disputes among some of the members.

Putin, 59, limped slightly as he greeted leaders at the summit. Aides said he had merely pulled a muscle. Underlining Putin's good health, a spokesman said he had a "very active lifestyle."

Discussions at the two-day meeting will focus on food security and trade liberalization. An agreement was reached before the summit to slash import duties on technologies that can promote economic growth without endangering the environment.

Breakthroughs are not expected on other trade issues at the meeting, which U.S. President Barack Obama is missing. He has been attending the Democratic Party convention and Washington is being represented by Secretary of State Hillary Clinton.

U.S. officials say Clinton's trip is partly intended to assess Russia's push to expand engagement in Asia, which parallels Washington's own turn towards the Asia-Pacific region.

Also missing the summit was Australian Prime Minister Julia Gillard. Putin said she had dropped out because her father had died.

(Additional reporting by Gleb Bryanski, Andrew Quinn, Katya Golubkova, Douglas Busvine, Denis Pinchuk and Andrey Ostroukh; Editing by Janet Lawrence)

 Newscribe : get free news in real time 

Japan's buying Diaoyu Islands provokes China to strike back

China should strike back over sale: experts

Analysts Friday slammed Japan's plan to nationalize the Diaoyu Islands in the East China Sea as provocations which would further trash Sino-Japanese relations, and called on the Chinese government to take corresponding measures to counter Japan's scheme.

This video image, taken by the Japan Coast Guard on Aug 15, and released on Aug 27 shows a Chinese boat carrying Hong Kong activists after landing on the disputed island called Senkaku in Japanese and Diaoyu in Chinese in the East China Sea.
Japan's Yomiuri Shimbun paper reported that Japan is scheduled to hold a cabinet meeting on Monday to officially "nationalize" the Diaoyu Islands on Tuesday.

The Japanese government will sign a deal with the so-called private owners on Tuesday to purchase the islands. And the Japanese government believes that putting the Diaoyu Islands under state ownership at an early date could minimize the backlash from China, said the report.

The paper also noted that the actions of Tokyo Governor Shintaro Ishihara, who had pushed strongly for the island purchase, had helped drive the state toward the purchase.

Qu Xing, director of the China Institute of International Studies, told the Global Times that by buying the islands, Japanese Prime Minister Yoshihiko Noda's administration is attempting to reinforce Japan's claim of sovereignty over the Diaoyu Islands.

"The repeated provocations have greatly undermined Sino-Japanese relations," said the expert.

"We should resort to corresponding countermeasures to strike back against Japan's unilateral move. Japan is making their assertion by legal means. Accordingly, China could also reinforce our claims of sovereignty over the islands through legal means," said Qu.

According to the Kyodo News Agency, Japanese Foreign Minister Koichiro Gemba said that Noda is unlikely to hold summit talks with Chinese President Hu Jintao and South Korean President Lee Myung-bak on the sidelines of the ongoing Asia-Pacific Economic Cooperation (APEC) forum in Vladivostok, Russia, indicating that formal talks would not be appropriate given renewed territorial rows.

Gemba added that informal and "spontaneous" exchanges may take place, the report said.

Wang Ping, a researcher with the Institute of Japanese Studies under the Chinese Academy of Social Sciences, told the Global Times that Sino-Japanese relations are bound to be further undermined if Tokyo continues to inflame the situation.

"Japan's national interests as well as its strategic interests in East Asia and the West Pacific will also be hurt. It should better recognize the consequences of its moves," warned Wang.

The impact of the diplomatic rows between the two countries have already extended to the sphere of economic ties.

Reuters quoted Toshiyuki Shiga, a senior executive of Japanese auto maker Nissan, as saying that Japanese car manufacturers were having difficulty in holding big, outdoor promotion campaigns, which may have hurt August sales.

Foreign ministry spokesman Hong Lei said Thursday that in order to change the current situation, Japan must immediately stop encroaching upon China's territorial sovereignty.

China is Japan's largest trading partner, while Japan is the fourth largest trading partner of China.

Though Japan relies much more on its trade with China than China does Japan, economic friction is a double-edged sword, Qu said.

"The adverse political climate will definitely affect economic relations. But smashing Japanese cars and boycotting Japanese goods don't help resolve the problems," said Qu, calling for the public to remain rational.

Separately, Taiwan leader Ma Ying-jeou Friday inspected the Pengjia Islet, which is located 156 kilometers from the Diaoyu Islands. He made a speech in front of a monument on the islet and praised those who have helped to protect the Diaoyu Islands, reported the Xinhua News Agency.

Responding to a question about Ma's visit, Hong Lei said Friday that all Chinese, including those from both sides of the Taiwan Straits, are responsible for safeguarding the sovereignty of the islands.

By Jin Jianyu and agencies contributed to this story

 

Taiwan warns Japan against nationalising islands

Pengchia:  Taiwan’s president used a high-profile visit to a Taiwanese islet on Friday to warn Japan against making any attempts to nationalise islands that are part of a disputed chain in the East China Sea.

Escorted by warplanes and naval vessels, President Ma Ying-jeou flew by military helicopter to Taiwan’s Pengchia Islet, which lies off northern Taiwan, only about 140 kilometers (85 miles) west of the disputed chain.

The chain — known as Senkaku in Japan and Diaoyu in China — is controlled by Japan but also claimed by China and Taiwan, and has been a key part of simmering regional tensions over rival territorial claims. Japan’s government reportedly is planning to buy several of the islands from their private Japanese owners.

Analysts say Ma chose the Taiwanese islet to make his well-measured gesture to raise international attention without further aggravating tensions.

South China Sea. Agencies

Disputes have flared over island chains in the East China and South China seas, rich fishing grounds with potentially lucrative oil and gas reserves.

But diplomatically isolated Taiwan — which China claims a part of its own territory 63 years after the two sides split amid civil war — has been largely left out of the spotlight.

Ma called on the East China Sea chain’s three claimants — Taiwan, China and Japan — to put aside their disputes and hold dialogues to jointly develop the rich resources there. He suggested bilateral or trilateral talks “to resolve the issue in a peaceful way.”

Ma also asked commanders at two Taiwan-controlled islets in South China Sea’s Pratas and Spratly island chains to strengthen guards. Those chains are claimed by Taiwan, China, Vietnam, the Philippines, Brunei and Malaysia.

“Ma has tried to avoid provoking tension, but as Taiwan’s leader, he must make a gesture even though the impact may be limited,” said Lo Chih-cheng, a political scientist at Taipei’s Soochow University.

While Taiwanese media were generally skeptical about the visit’s impact, some say Ma’s trip may manage to rebut Beijing’s appeal for a united front with Taiwan over the disputes. Many Taiwanese fear Beijing may be using its warming economic ties with Taiwan in recent years to further its goal of unifying with the self-ruled democratic island.

“The mainland is trying to create the false scenario of cross-Strait cooperation in the East and South China” seas, Taiwan’s China Times said in an editorial. - AP

No let-up in protests over Diaoyu Islands

By CHOW HOW BAN hbchow@thestar.com.my/Asia News Network

There have been protests on many fronts after the move on Monday by Japanese government to buy the islands from their “owners”.

CHINESE actress Li Bingbing became the latest ordinary citizen to publicly show her outrage against Japan over its claim of the disputed Diaoyu Islands (known in Japan as Senkaku Islands).

The Golden Horse Best Actress award winner turned down an invitation to attend the premiere of her latest film, Resident Evil: Retribution, in Tokyo on Monday in protest of the move by the Japanese government to buy the islands from their “owners”.

“The premiere in Tokyo was an important event for this film because it was the first premiere around the world. During the shoot, it was already decided that all the production crew should go for the Tokyo premiere,” she said.

“I do not like to break an appointment but after what had happened to the Diaoyu Islands, I did not feel like going. It is something I cannot stand and I thank the film company for their understanding,” Li was quoted by the Chinese media as saying on Thursday.

Two weeks ago, two Chinese men, aged 23 and 25, were detained for stopping the car of the Japanese Ambassador to China, Uichiro Niwa in downtown Beijing.

The duo allegedly emerged from their car and pulled the Japanese flag off Niwa’s car when the ambassador was on his way back to the Japanese embassy.

Another man was issued a warning for blocking Niwa’s car.

Earlier last month, hundreds of Chinese protesters took to the streets in Shenzhen and Hangzhou and called on the Chinese government to protect the islands, following an incident where 10 Japanese nationalists swam to the islands in East China Sea in response of a similar landing by seven Chinese activists.

Some Chinese protesters also surrounded the embassy in Beijing and the Japanese consulate office in Shenyang, Liaoning province.

Two senior citizens who threw eggs at the embassy were persuaded to leave, while another demonstrator was stopped by the police when he attempted to enter the premises.

Other demonstrators held a 7m-long banner expressing their indignation over Japan’s detention of the Chinese activists who landed on the islands.

Last Monday, Kyodo News Agency reported that Tokyo was in the final stages of reaching a deal to buy the islands by the end of this month.

Japanese television images showed that a team of surveyors dispatched by Tokyo Governor Shintaro Ishihara was surveying the shoreline and waters around the uninhabited isles.

The surveyors then released the outcome of their investigation, detailing the geographic composition of the islands.

Apparently, Ishihara called on the Japanese government to build a harbour in the area.

It was reported that the administration of Prime Minister Yoshihiko Noda had agreed to pay two billion yen (RM79mil) for the islands.

The controversial islands are counter claimed by China and Taiwan.

China and Taiwan claim that the islands have been a part of Chinese territory since at least 1534 until Japan took brief control of it during the first Sino-Japanese war (1894-1895), while Japan has rejected claims that the islands were under China’s control prior to 1895.

In its editorial, China Daily warned that Japan was dicing with danger of leading the Sino-Japanese relations to their worse path.

“Japan is escalating tensions between itself and China. Our protests, be it official or civil, have fallen on deaf ears with the Japanese government.

“The deal for the islands was signed just five days after a letter from Japanese Prime Minister Noda to Chinese President Hu Jintao was delivered in Beijing on Aug 31. Noda was then said to have talked about lowering tensions between the two countries.

“The Noda administration now lacks credibility. They said they wanted to maintain and manage the islands in a peaceful manner but the islets are not part of Japan’s territory,” it said.

The newspaper said while China had kept its word to seek common ground on the islands and to maintain peace in the area, Japan had no longer shared the same goal.

China had failed to understand Japan’s diplomatic strategy, after all, and should re-look into its stand on the issue, it added.

Xinhua news agency slammed the islets purchase deal, saying that it would put to test Japan’s credibility over an historical commitment made in 1978 friendship treaty between Japan and China to resolve the issue.

Renmin University’s Centre for East Asia Studies director Huang Dahui said the pressure from the Japanese elections and fears of China’s economic development were reasons for the move.

“Japan is playing a two-faced game with China. What Ishihara and Noda are trying to do share the same purpose, which is to nationalise the Diaoyu Islands. China should strongly protest,” he told Global Times

Related posts:

Japanese right-wingers seek political gains landed on Diaoyu Islands

China demands Japan release Chinese activists landed ... 

China, S.Korea demand Japan own up to its wars ... 

Events in East Asia, stakes and realities

Japan, the deputy sheriff in Asia?

Is China still a developing nation?

Tweet

Global Trends By MARTIN KHOR

Last week, US President Barack Obama said China has ‘grown up’ and must take on the responsibilities of a developed country. But is China already grown up – or is it still a developing country?

 China’s fight to retain its developing country status is of interest to other developing countries, for they will be next if China loses that fight

IS CHINA still a developing country, or has it joined the ranks of the advanced developed countries? This has become a topical question, especially after US Presi-dent Barack Obama reportedly told Chinese President Hu Jintao last week that China had to act more responsibly now that it has “grown up”.

This interesting conversation took place at the Asia-Pacific Economic Cooperation (Apec) Summit in Hawaii. And when Obama met Chinese premier Wen Jiabao at the East Asia Summit hosted by Asean in Bali last week, he must have said something similar, in between chiding him for not allowing the Chinese currency to shoot up.

By telling China that it has become a grown-up, Obama meant that China should now be treated just like the US or Europe in terms of international obligations – like taking on binding commitments to reduce greenhouse house gas emissions, cutting its tariffs to near zero and giving up its subsidies under the World Trade Organisation, giving aid to poor countries and letting its currency float.

This is what the US has been pressurising China to do in the recent negotiations in climate change, in the WTO’s Doha talks, at various meetings of the United Nations and at the Apec summit.

In fact, most of the important multilateral negotiations are stalled because the US (with Europe and Japan standing behind it) insists that China gives up its developing country status and takes on the obligations of a developed country.

It is not only China, of course. They also want India and Brazil to do likewise. And often also mentioned are South Africa and the wealthier or bigger Asean countries.

The main focus, however, is China. There has been growing respect for – or, rather, fear of – China, that it is growing so fast and has become so big and powerful it might swallow up the Western world in a decade or two.



So, the question is pertinent. Is China a developed country?

The answer depends on what criteria are used. In absolute terms, China is indeed a big economy. Its GNP is second only to that of the United States. It has become the biggest emitter of greenhouse gases, having overtaken the United States.

But this is mainly because China is a big country in terms of population. With 1.3 billion people, it is the world’s most populous country.

However, despite the mighty image it has been given by the world media, China looks like a very ordinary developing country once we look at per capita indicators.

Whether one is a developed or developing country is defined by the UN and by the IMF and World Bank, and the most important criterion is income per capita.

By that yardstick, China is very much a developing country.

The International Monetary Fund, in its latest World Economic Outlook, classifies China as a developing country, with a per capita Gross Domes­­-tic Product last year of US$4,382 (RM13,852), ranked a lowly 91 of 184 countries in the world.

Six African countries (Equatorial Guinea, Gabon, Botswana, Mauritius, South Africa, Namibia) had GDP per capita levels higher than China.

China’s GDP per capita was less than a tenth that of the United States, which had US$46,860 (RM148,129). Luxembourg had the highest ranking, US$108,952 (RM344,408). Ma­­laysia was No. 65 at US$8,423 (RM26,626) and Singapore No. 15 at US$43,117 (RM136,297).

Economists also use the measure of GNP per capita “in gross purchasing power” (GPP). This is to take into account the different costs of living in different countries. People living in countries with a lower cost of living could enjoy a higher li- ving standard than their country’s GNP implies.

Last year, in GDP (at GPP) per capita terms, China was lower still at No. 95 with US$7,544 (RM23,847), just below Ecuador and just above Albania, El Salvador and Guyana.

By contrast, Malaysia was at No. 58 with GPP per capita of US$14,744 (RM46,607) while Singapore was No. 3 with US$56,694 (RM179,295).

The UN Development Programme has a human development index (HDI) that measures quality of life in terms of income, schooling, life expectancy and so on.

The Human Development Report 2011 shows China at No. 101 of 187 countries with a HDI of 0.687 and in a category of “medium human development”.

What about climate change? China, again mainly because of its huge population, is the top greenhouse gas emitting country, with a total of 7,232 megatonnes of CO2 equivalent in 2005. The US is second with 6,914 Mtonnes. India was fifth with 1,859 Mtonnes.

But in per capita terms, China’s emissions level was 5.5 CO2-equivalent per person, ranked 84 in the world. By contrast, the US’ per capita emission was 23.4 CO2 equivalent, Australia’s 27.3, Russia’s 13.7, Ger­many’s 11.9, Japan’s 10.5, Singa­pore’s 11.4, Malaysia’s 9.2, South Africa’s 9.0, Brazil’s 5.4, Indonesia’s 2.7, India’s 1.7 and Rwanda’s 0.4.

Thus, as No. 91 country in the world in GDP per capita, No. 101 in human development index and No. 84 in per capita emissions, China is looking like, and is, a middle-level or even lower-middle level developing country, with not only all the developed countries ahead of it, but also many developing countries, too.

China also shares the same characteristics of many developing countries. More than 700 million of its 1.3 billion people live in the rural areas, and in 2008 there was a large imbalance, with the urban disposable household income 3.3 times bigger on average than in rural areas.

According to China’s own standard, 43 million Chinese are low-income (below US$160 (RM506) a year). By the higher UN standard, 150 million people are poor, living on less than US$1 (RM3.16) a day.

Each year, 12 million people are newly added to the job market, outnumbering the population of Greece, and it is quite a task to find them jobs.

This does not deny the fact that there are high points in China’s development: its big GNP in absolute terms, its high rate of economic growth, the foreign reserves of above US$3 trillion (RM9.5 trillion).

But the fact remains that while China has become a big economic power in absolute terms, it is still a middle-level developing country, with the socio-economic problems that most developing countries have.

And if China is pressurised to take on the duties of a developed country and to forgo its status and benefits of a developing country, then many other developing countries that are ahead of China (at least in per capita terms) may soon be also asked to do the same.

Thus China’s fight to retain its developing country status is of interest to other developing countries, for they will be next if China loses that fight.