Post #86 7 January 2016

Gentlefolk

This post contains the News Summary for December 2015.

Exams completed

I had my last exams this morning – all 'done & dusted' for another semester.  

In a week we will head south for the winter break, first to Hong Kong and then to The Land Down Under.

We’ll return to Qingdao at the end of February for the start of the second semester of this academic year – and our last semester teaching in China.

I won’t do the “monthly news summaries” while we are away - will start again in March 2016.

I hope to do a couple more posts before we leave Qingdao – let’s see how things go – but normally don’t do any while we are travelling.

China's stock market

The main index is the Shanghai Composite Index.  As you can see from the graph below, 2015 was a wild ride. The market went crazy in March and then collapsed in June.  It seemed to have stabilised over the last 3 months, but the first week of 2016 has seen great volatility again. What it will do in 2016 is anybody's guess. 

The Shanghai Composite Index in 2015. A wild ride.

A curious thing about Chinese stock exchange boards which show movements of stock prices. Here price increases are shown in RED, while price decreases are shown in GREEN - the opposite of how price movements are shown on Western stock exchanges.

Red is the color of good luck and good fortune in China so price rises are shown in red.

A board with this much green is BAD BAD news in China.

(We're just glad Chinese traffic lights follow the rest of the world!)

News summary for December 2015

As you know, I compile a monthly summary of news items, with a focus on news on China.  

There is so much competition for space within Western media outlets that usually only the unusual, sensational, or bizarre gets a mention. Hopefully this summary will give you a better idea of some of the things happening in China.

The events/items included are not necessarily the headlines, but rather things which caught my eye.

The second list shows international events reported in China.  There are so many things happening around the world (information overload!), that I find it useful to have such a list to look back at. 

These news items were all sourced from the China Daily newspaper 1 – 31 December 2015. I can't guarantee the accuracy of the statistics - I'm just quoting what is reported in this newspaper.

Actual events usually occurred a day or two before they appeared in the China Daily newspaper. 

Currency shown is US$, and the exchange rate used this month is US$1 = Yuan 6.5.

Remember: the China Daily is a government newspaper whose main purpose in life is to make the Communist Party of China (CPC) and the Chinese Government look good.  But if you strip away the propaganda, there is still quite a lot of interesting stuff in the paper. 

Events which made the news in China in December 2015

(a) Domestic (in China) events and news

1 Dec	A court sentenced 14 people to prison terms for negligence or poor management in the explosion of an oil pipeline in Huangdao, Qingdao in 2013 in which 63 died and 156 were injured.
	President Xi and President Obama met on the sidelines of the Climate talks in Paris (COP21). China pledged $3 billion to the South/ South Cooperation Fund.
	In 2014 China’s coal consumption represented 51% of world usage; USA 12%; India 9%.
	930,000 candidates took the National Civil Service Exam last Sunday, for about 28,000 vacancies.
2	Copper smelters in China said that they will reduce output by about 8 million tonnes (4.5%) in 2016.
3	China has 276 million registered Passenger Motor Vehicles (of which 160m are cars) and about 322 million licensed drivers. In 1980 there were about 100,000 PMVs in Beijing; by 2008 that number had increased to 3.5m, and is now over 5.5m. PMV sales in November totalled 2.5m units and for 11 months January to November totalled 21.8m units. SUV sales booming.
	22% of 306 listed State Owned Enterprises (SOEs) and their subsidiaries made losses in the first 9 months of 2015. The biggest loss was made by Sinopec Oilfield Service Corp (-$328m). Wuhan Iron & Steel Corp announced losses of $155m and will cut 6,000 jobs. The govt has implied that SOEs which make losses for 3 consecutive years (so called ‘Zombie Companies’) may be closed down.
	The China Global Philanthropy Institute was opened in Shenzhen, to provide training for managers in the charity sector. The Gates Foundation is a sponsor.
4	In 2014 China produced about 38 billion ballpoint pens (80% of global production); but 90% of the nibs and refills were sourced from Japan, Germany and Switzerland.
	A report by the China Academy of Social Sciences into the residential property market estimated an oversupply of about 2 billion square meters, which could take up to six years to clear. The oversupply is especially serious in 3rd and 4th tier cities. Calls for the govt to stimulate sales.
	China has 22 nuclear power reactors in operation, and another 26 under construction. By 2020 nuclear power will generate about 88 Gigawatts. The govt sees nuclear power as an important source of clean energy. After trials in major cities, China will introduce a national carbon emissions trading market in 2017.  The European Union has provided training for staff. Coal consumption peaked in 2013 at 2.05 billion tonnes; falling to 1.95 bt in 2014. The govt has announced that no new coal mines will be approved for at least three years.  In 2016 some 60 million tonnes of outdated mines will be closed.
	Stephen Schwartzman, Founder and CEO of the Blackstone Group, has provided funding of $100m to Tsinghua University for the “Schwartzman Scholars Program”. 100 students will do a one-year Masters course  in Beijing; the first intake has 45 Americans, 20 Chinese, 35 from other countries.
7	There are now 500 Confucius Institutes in 134 countries providing classes on Chinese language and culture to 1.9 million students.
8	Beijing issued its first-ever “red alert” for hazardous air quality: schools close; cars go to odd-even numbers; trucks cut by 30%; 2,000 polluting industries and 3,500 construction sites close. Tianjin and other close cities followed suit.
12	Restoration work has started on Shanghai’s Xu Jia Hui Catholic Cathedral.  It was built in 1906-10 by the Jesuits; the architect was William Doyle. The ‘face-lift’ will take more than a year and cost close to $5m.
	The Alibaba Group has acquired Hong Kong’s South China Morning Post for $266 million.  The SCMP was founded in 1903 and is HK’s oldest English newspaper.
	The 2015 report by the Institute of City Competitiveness ranked 358 cities in China based on ten criteria (infrastructure, human resources, etc). The top ten were: Shanghai; Hong Kong; Shenzhen; Beijing; Guangzhou; Tianjin; Suzhou; Chongqing; Hangzhou, and Wuhan. Shenzhen is expected to pass Hong Kong in terms of GDP this year. PwC forecasts that China’s middle class will total 350m by 2020.
	The first Western-style fast food restaurant, a KFC, will open in Lhasa, Tibet next month.
14	The founder of Xioami, Lei Jun, had predicted sales of smart phones would reach 100 million units in 2015, but only 53m sold in the first 9 months.
16	American basketball player, Stephon Marbury, was granted a Chinese ‘green card’.  He plays for the Beijing Ducks.
	The ‘Master of Interpretation and Translation’ qualification is becoming more popular.  In 2008 there were 8,000 graduates; in 2014 there were 13,500.
17	In 2014 about 350,000 people were diagnosed with liver cancer.
	New entertainment: Movie “Mo Jin – The Lost Legend” starring Chen Kun, Shu Qi and Angelababy is about tombs and ghosts and feng shui. Movie “Xuan Zang” based on novel Journey to the West; starring Huang Xiao Ming. TV 12 episode “Survival Games” starring Bear Grylls and 8 Chinese celebrities.
18	A coal mine blast in Hegang, HLJ: 19 miners died, 33 escaped.
19	Beijing’s second “red alert” for smog; expected to last 4 days; Tianjin followed and 4 cities in Hebei Province (Baoding, Handan, Langfan, and Xingtai). The widespread burning of low-quality coal for heating was blamed, at least in part for the increase in air pollution.
	China has 33,652 Buddhist sites and 8,269 Taoist sites.
21	Collapse of a construction waste “hill” in Shenzhen, and subsequent landslide; 76 missing; 4,000 emergency workers searched for survivors aided by 170 excavators.
	The Baoneng Group bought 30% of shares in Vanke, China’s largest residential developer. Hostile takeover.
25	The population of Shanghai increased from 16m in 2000 to 24m in 2014 (of which 14m have a Shanghai hukou). The govt wants to cap Shanghai’s population at 25m.
	Guangzhou is providing $1.6 billion to support start-ups.
26	A gypsum mine in Pingyi County (Shandong) collapsed; 10 miners rescued, 19 still missing.
28	China’s largest telecom company, China Mobile, has 1 million 4G base stations to support its 267m 4G customers (more than China Unicom and China Telecom combined). The Chairman of China Telecom, Chang Xiao Bing, is under investigation for corruption.
	In its first 12 months of operation, the South-North Water Diversion Project has delivered 870 million cubic meters of water to Beijing.
29	China’s Anti-trust regulator found 8 international shipping companies guilty of price-fixing on freight charges for cars and trucks which resulted in increased prices for Chinese consumers.  Companies included Mitsui OSK, Nippon Yusen, Kawasaki and Sud Americana of Chile. Fines totalled $63 million.
	The National Postgraduate Entrance Exam was held last weekend; 1.8 million registered to sit the exam (60% female, 40% male); most popular courses were Business Administration, Accounting and Finance. According to news reports, some of the Math paper was ‘leaked’ and Paper B was used. Police are investigating the leak (this is regarded as a criminal offence with minimum 3 years jail).
	The 2015 Adult Tobacco Use Survey estimated 316 million smokers in China (about 27% of population; 50% of adult males and 3% of adult females). Little change from 2010. Average consumption 15 cigarettes a day.
30	Construction has started on two new terminals and a 5th runway at Shanghai’s Pudong Airport.  Will boost capacity to 80 million passengers per annum. Completion by 2019. The Civil Aviation Administration of China auctioned 9 slots at Guangzhou’s Baiyun Airport. Major companies including Hainan Airlines, China Southern, China Eastern acquired slots (good for 3 years, can be sold or transferred).
	Sinopec will increase shale gas production at its Fuling Field from 6.5 billion cubic meters to 10 bcm by 2017.
	China Southern Airlines announced orders with Airbus for $2.3 billion, and with Boeing for $10 billion.
	China’s main stock market index, the Shanghai Composite Index, opened 2015 at 3224 and closed the year at 3572.  It peaked at 5166 in June before a massive sell-off.

(b) International events

1 Dec	The European Union agreed to give Turkey $3.2 billion to assist with the influx of refugees.
	52% of Hamburg residents voted against bidding for the 2024 Olympic Games. Paris, Los Angeles, Budapest and Rome have expressed interest.
	Kobe Bryant of the LA Lakers announced his retirement at the end of this NBA season.
2	The German Cabinet approved plans to send 1,200 troops to Syria.
	Turkey refused to apologise for shooting down a Russian Air Force jet.
3	President Xi Jin Ping and his wife official visit to South Africa. He also attended the 6th Ministerial Meeting of China – Africa Cooperation. President Xi announced $60 billion in aid (most in the form of low-interest loans).
	Beijing and Washington agreement on fighting cyber-crime.
	Mark Zuckerberg’s wife Priscilla Chan gave birth to a baby girl, Maxima.  They announced the establishment of a charity and give away 99% of investment in Facebook (estimated current value $45 billion).
	One million Apple Watches were sold in China between April and September 2015.
4	A husband and wife couple, Syed Farook and Tathfeen Malik, killed 14 and injured 17 in San Bernardino, California. They died in a shoot-out with police. They had a 6 month old baby girl.
	Two more FIFA officials arrested on suspicion of corruption, Vice Presidents Juan Napont (Paraguay) and Alfredo Hawit (Honduras). Later in the month Sepp Blatter and Michel Platini were banned from all soccer activities for 8 years.
	BCG’s annual list of 50 Most Innovative Companies included three from China: Tencent (#12); Huawei (#45); and Lenovo (#50). The top three were Apple, Google and Tesla.
8	Opposition parties won a majority in the Venezuela general elections.
	The Luye Medical Group bought Health Care Australia for $688 million (HCA owns 17 private hospitals with 2,000 beds and 50 operating rooms).
10	China and Australia announce that their Free Trade Agreement will commence on 20 December 2015.
11	Kim Jong Un announced that DPRK has the capability to detonate a H-bomb.
	Inauguration of Mauricio Macri as new President of Argentina.
14	Agreement reached at Climate Change Conference in Paris (COP21). Of cumulative greenhouse gases 1850 – 2011 the US produced 27%, EU 25%, and China 11%.
	First woman elected to local Council in Saudi Arabia, following first election in which women could vote.
	United Kingdom has 532,000 university students.  In England, 42% of 18 & 19 year-olds attend university.
	Golden State Warriors lost to the Milwaukee Bucks 95 – 108 to end the longest winning start to an NBA season (now 24 – 1).
	With a score of 267 world #6 Fan Shan Shan won her third Dubai Ladies Masters tournament, by 12 strokes.
16	Beijing condemned new American arms sales to Taiwan worth $1.8 billion (including 2 frigates and anti-tank missiles); it said the companies involved would be penalised in doing business in China.
	The Second World Internet Conference was held in Wuzhen, Zhejiang Province.
	Saudi Arabia announced the establishment of a military alliance of 34 Islamic nations, based in Riyadh. Main aim is to better coordinate the fight against terrorism. Not included were Iran, Iraq and Syria.
	New Zealand selected the flag design (silver fern & 4 stars; designed by Kyle Lockwood) which will compete against the current flag in a referendum in March 2016.
	China Petrochemical Corp (Sinopec) will buy 20% of Sibur Co of Russia.
19	Chelsea manager Jose Mourinho, 52, was fired after 9th loss in 16 games.  Last season Chelsea won the Premier League and League Cup double!
21	The US Congress finally ratified the IMF reforms agreed in 2010; China’s quota will go from 3.9% to 6.4% making it the 3rd largest shareholder. China is now the third largest contributor to the UN budget (7.9%), after USA and Japan.
	China and Thailand will jointly build a 845 km railway from Nong Khai in the north to Map Ta Phut in the south (part of the eventual Kunming to Singapore line).
	Shares of the global TV market: Samsung 29%; LG 14%; Sony 7%; Hisense 6%.
	In an effort to end the civil war in Syria and present a united front to ISIS, the UN Security Council called for a ‘cease-fire’ and for talks between the govt and opposition.
23	After launching eleven satellites, Space X’s main-stage booster rocket made it back to earth – may be reusable.
	Mexico launched an anti-dumping investigation into imports of steel from China. In 2014 China’s steel exports reached 94 million tonnes (46% higher than 2013).  2015 estimate is 110 million tonnes.  Nine National Steel Associations (incl USA, Canada, Brazil) blamed China’s over-capacity for unfair competition.
24	Colombia legalised the growing and sale of marijuana for medical purposes (joining Mexico, Chile and Uruguay).
26	The inaugural meeting of the AIIB will be held in Beijing 16 – 18 January 2016.
	34,578 Chinese children are studying in US primary and secondary schools (52% of all foreign students). The figure was 8,857 in 2010.
29	Japan and South Korea reached agreement on the long-running issue of “comfort women” (sex slaves in WW2); only 46 still alive; President Abe will make an apology and a $8m fund will be established.
	UN estimates over 1 million “migrants” have reached Western Europe (mainly Germany) this year. There are 154 refugees (mainly from Somalia, Syria and Afghanistan) in China, and 641 others (mostly from Nigeria and Liberia) have claimed asylum. China does not accept refugees, so they are waiting for settlement in other countries.  UNHCR gives them about $160 per month.
	New movie “Star Wars – the Force Awakens” took $1 billion globally in 12 days. It will open in Chian on 9 January.
31	Best end-of-year standings in American Basketball and Football: NBA: Golden State 29 – 1; San Antonio 27 – 6; Cleveland 20 – 9 (Lakers 5 – 27 are last in their Division). NFL: Caroline 14 – 1; Arizona 13 – 2; New England 12 – 3.

...

Best wishes to you all, keep well and keep smiling.

Alex & Vera Olah

English teachers at the China University of Petroleum, Qingdao

www.upc.edu.cn

Thursday 7 January 2016