Politics

1. Landslide in Guangming New District in Shenzhen

The landslide in Guangming New District (光明新區), Shenzhen, happened on 20 December 2015, causing at least 69 casualties. Investigators from the State Council concluded that this incident was not a natural disaster but an incident of production safety (生產安全事故). The Party Secretary of Shenzhen Ma xingrui (馬興瑞) made public apology to the public on 25 December 2015. A few days later, the director of Shenzhen Guangming New District Urban Management Bureau Xu Yuanan (徐遠安) who was responsible for approving the project fell from a building and was found dead. It was reported by the media that the red mug landfill site had been built within the Ecological Control Line, which the Shenzhen Municipal Government in 2005 established by law to protect the green zone in the city. According to the law, only public infrastructure, municipal public facilities, tourist facilities and parks are eligible to be built within the Ecological Control Area. The landfill site was regarded by the Bureau of Environmental Protection as municipal public facilities for the sake of improving city’s environment and thus permission was granted. However, the site was poorly regulated and lax oversight by the relevant officials is attributed to the incident.

• //深圳是中国的第一个经济特区，这里在20世纪80年代开始引进自由市场经济。随着深圳市领导人推动进一步的经济改革，这座城市已越来越多地向先进行业转移，比如生物技术。这次滑坡表明，深圳的成功并没有让其免受发展中监管不力风险的影响。中国首都出版的报纸《新京报》周一在一篇评论中说，这场灾难最令人吃惊之处是其发生的城市。“近年来，泥石流、滑坡等灾害的确时有发生，但事发地多是地质灾害多发地，抑或是对资源过度开采管束乏力的治理能力薄弱地带，”评论说。“而深圳按理说不在此列，其现代化水平在中国城市中位居前列。”中国新闻机构称，深圳一家进行工地勘测的公司之前就警告过该工地的危险。据商业新闻出版物《21世纪经济报道》介绍，今年1月，宗兴环保科技有限公司发布了一份环境影响评估报告，警告称水土流失可能导致滑坡，“危及山体和边坡的安全。”该报道称，发布在公司网站上的报告，以及事故发生地深圳市光明新区政府网站上的一则相关通知，看来已经被删除。// Source: New York Times (Chinese Edition), 22 December 2015.
• //Investigators at the scene found the man had committed suicide, the report said, citing a statement from the district Public Security Bureau. The man was identified as Xu Yuanan, the director of Shenzhen Guangming New District Urban Management Bureau. Shenzhen police said on Monday afternoon that it had detained 12 people including several executives from the site operator, Yixianglong Investment Development Company, along with others suspected of being responsible for the landslide. […] Xu’s death has echoes of the suicide of an official in Tianjin who took his life after the huge blasts at a dangerous goods warehouse at the city’s port in August. The official at the city’s transport commission was in charge of issuing approvals for schemes. […] The owner of a gypsum mine in Shandong province that collapsed last week, trapping 17 miners, killed himself on Sunday after jumping into a well, Xinhua reported. //Source: SCMP, 28 December 2015.
• //端傳媒通過對核心地帶紅坳村工業園的選址調查後發現，引發事故的紅坳渣土受納場，實際竟然建在深圳生態控制線內。這條被稱為「鐵線」的生態控制線，是2005年，深圳以8處大型區域綠地和18條城市生態廊道組成的生態綠地系統為基礎劃定的，並一直列為政府的重點項目，也是中國首條環境生態線。生態線仿效的是香港郊野公園保護制度，或者是內地的自然保護區。根據2013年優化的生態控制線圈定的土地面積，佔深圳總面積的一半。但是，位於光明新區的紅坳渣土受納場，這樣一個明顯存在巨大生態環境污染隱患的污染項目，究竟是如何通過審批進入生態線之內的，並通過環保部門的審批呢？[…] 紅坳渣土場卻是光明新區的負面例子。從Google Earth的衛星圖記錄，自03年到15年間，該片工業園區周遭生態環境嚴重惡化。被渣土覆蓋的土黃色區域逐年擴大。根據同於2005年出台的《深圳市基本生態控制線管理規定》，除了重大道路交通設施、市政公用設施、旅遊設施和公園可以進入生態控制線區域外，其他建設被嚴格禁止。但由於環保部門的批覆顯示，城管部門認定該項目屬市政公共設施，屬於可以建設在生態線範圍內的四類項目之一。[…] 2015年2月27日對《光明新區光明紅坳餘泥渣土臨時受納場建設項目環境影響報告表》的批覆（深光環批[2015]200139號）中出具的理由是，光明新區光明紅坳餘泥渣土受納場項目本身是一項環保工程，「有助於將光明新區餘泥渣土進行有效的削減和處置，對城市環境將有明顯的改善作用。本項目選址不在飲用水源保護區，但在生態控制線範圍內，項目為市政項目，屬於可在生態控制線內進行建設的項目。」一個重污染項目就此搖身一變為環保工程。[…] 政府一邊要求嚴格執行生態控制線，另一邊又有各種污染項目可以順利通過環保部門審批佔用生態控制線範圍，這條線究竟是城市環保的化妝術，亦或是間接轉化為各級審批部門新的尋租方式？//Source: The Initium, 24 December 2015.
• //By many measures, China’s industrial safety record has improved in recent years. But the ruling Communist Party still struggles to impose accountability on local bureaucrats, who face little public scrutiny but come under intense pressure from leaders to meet goals like dealing with building waste. And like the deadly explosions last year at a toxic chemical storage site in Tianjin, a northern port city, the disaster in Shenzhen suggests that dark pools of mismanagement and corruption persist even in the most developed parts of the country. The company that operated the dump in Shenzhen, a relatively wealthy and open city adjacent to Hong Kong, brushed past approval rules, safety warnings and residents’ complaints. Supervision came mostly under a single local government agency, whose oversight was lax at best. Seventeen government officials and company employees have been arrested over the accident,including Long Huamei, a former schoolteacher from Hunan Province whose company operated the dump. “It’s quite often that the goal is to get approval, rather than be truly in compliance with the spirit, whether it’s the environmental impact assessment or safety,” said Dali L. Yang, a professor at the University of Chicago who has studied China’s efforts to strengthen safety regulation. “They think, ‘I can get away with this, so why bother?’ ”// Source: New York Times, 16 January 2016.

 2. French Journalist expelled from China over her article criticizing policies towards Uighur

A French journalist Ursula Gauthier who was the Beijing correspondent for French magazine L’Obs was expelled from the country due to her critical article on the China’s policy towards Uighurs in Xinjiang. For her article in question, please see here (in French).

• //China’s Foreign Ministry said Saturday that a French journalist would be expelled from the country for writing an article about ethnic violence in China’s northwest, one that the government viewed as sympathetic to terrorism. In her Nov. 18 article for the French newsweekly L’Obs, the reporter, Ursula Gauthier, discussed the terrorist attacks that had killed 130 people in Paris several days earlier, and she criticized the Chinese government’s attempt to link them to the intermittent violence in the Xinjiang region of China. She said the attacks in Xinjiang, often carried out by members of the Muslim Uighur minority, had “nothing in common” with the Paris killings and stemmed from China’s own hard-line policies toward the Uighurs.// Source: New York Times, 26 December 2015.
• //Gauthier’s press credentials and visa expire on 31 December, meaning she will effectively be forced to leave the country unless they are renewed before then. It would be the first time a foreign journalist has been expelled from China since 2012 when Melissa Chan, an al-Jazeera English correspondent known for her hard-hitting reports on human rights issues, was forced to leave. Speaking on Saturday, Gauthier said she believed her expulsion was an attempt to silence criticism of Beijing’s policies in Xinjiang and to intimidate fellow journalists. “They are just telling [foreign journalists]: ‘Beware! Behave! If you don’t [toe the government’s line] you will have the same end as Ursula Gauthier.’ That is what they are saying.”// Source: The Guardian, 26 December 2015.

 3. The first Counter-terrorism law enacted in China

The enactment of the counter-terrorism law concerns foreign corporates in China, human rights groups, and foreign journalists. The foreign corporates are worried that sensitive data or commercial secrets could be requested by the Chinese authorities under the new law. Human-rights group Amnesty International is concerned that the law could allow more tools for the state to sensor unwelcome information. The French journalist Ursula Gauthier worries that this law could go against coverage about Xinjiang. The official Li Shouwei, deputy head of the criminal law division of the NPC Standing Committee’s legislative affairs commission emphasizes that the law does not affect the normal operations of enterprises, nor will it violate corporates’ intellectual property right or citizens’ freedom of expression on the Internet and religious beliefs. For the full text of the law, please see here (in Chinese).

• //The law, which goes into effect on January 1, also allows the People’s Liberation Army to take part in counterterrorism operations overseas, providing the missions are approved by the Central Military Commission and the countries involved. A state-level leading group on counterterrorism will be established and governments of and above the city level will also need to set up affiliated agencies. […] One provision requires technology companies to share encryption keys and back-door access with state security agents seeking to prevent or investigate terrorists acts. Critics said the law would threaten freedom of expression and intellectual property rights. US President Barack Obama said in March he raised his concerns about the law with his Chinese counterpart Xi Jinping. But Chinese officials said on Sunday the requirement was necessary, and lawmakers had already taken the need to protect business interests into account.// Source: SCMP, 28 December 2015.
• //Critics had said that the draft version of the law used a recklessly broad definition of terrorism, gave the government new censorship powers and authorized state access to sensitive commercial data. The government argued that the measures were needed to prevent terrorist attacks. Opponents countered that the new powers could be abused to monitor peaceful citizens and steal technological secrets. […] Telecommunication and Internet service providers “shall provide technical interfaces, decryption and other technical support and assistance to public security and state security agencies when they are following the law to avert and investigate terrorist activities,” says the law. […] “While the Chinese authorities do have a legitimate duty in safeguarding their citizens from violent attacks, passing this law will have some negative repercussions for human rights,” said William Nee, a researcher on China for Amnesty International who is based in Hong Kong, via email. “Essentially, this law could give the authorities even more tools in censoring unwelcome information and crafting their own narrative in how the ‘war on terror’ is being waged,” Mr. Nee said. […] International companies that use encrypted technology in China had been worried by provisions in the draft law that would have required them to hand over code and other information so that the authorities could monitor users. The law could affect multinational companies like Cisco, IBM and Apple, all of which have big stakes in China. “These companies have been dealing with this increased, let’s call it oversight, for the last two or three years,” said Scott D. Livingston, a lawyer who works for Simone IP Services, a consulting firm in Hong Kong, and who has followed the discussions over the law. With the antiterrorism law, Mr. Livingston said, “from the government’s perspective, you have a stronger basis to request this access.” In January, foreign business groups wrote to President Xi Jinping to voice collective unease about China’s Internet policies, including the draft legislation, which could have required handing over sensitive data and commercial secrets.// Source: New York Times, 27 December 2015.
• //[Ursula] Gauthier also said she feared a controversial new anti-terrorism law – which critics believe could be used to further restrict coverage of events in Xinjiang – placed foreign journalists in even greater danger. “I am really concerned that maybe next time someone messes around, like me, maybe they will be prosecuted. I am really worried about that,” she said. “I don’t know if [authorities] are nervous or if they have in their big wisdom decided that they will not tolerate any divergent voices any more.”// Source: The Guardian, 31 December 2015.
• //全國人大法工委刑法室副主任李壽偉昨天指出，目前通過的《反恐法》，最受美國等國家和一些機構企業關注的是該法第18條，即「電訊業務經營者、互聯網服務提供者應當為公安機關、國家安全機關依法進行防範、調查恐怖活動提供技術接口和解密等技術支持和協助」。李壽偉強調，當局在立法過程中研究借鑑美國和歐盟等法律，並單獨就第18條，廣泛聽取有關部門和企業的意見，相關規定符合反恐工作的實際，也與世界上主要國家的規定基本一致，不會影響相關企業的正常經營活動，也不存在侵犯企業知識產權、損害公民網絡言論自由和宗教信仰等問題。// Source: Hong Kong Economic Journal, 28 December 2015.

4. Anti-graft movement vowed to cover high-ranked party cadres

In the past year, a number of high-ranked CCP officials were pulled down from the positions as a result of the anti-craft campaign. Prof. David Shambaugh from the George Washington University observed that the anti-corruption campaign has shown no halt and many high-ranked party cadres were also under investigation. Yet, he warned that the campaign has led to distrust among party members, which might weaken the party itself. In the beginning of 2016, Xi Jinping’s remarks on the anti-graft campaign was published, signifying the continuity of the anti-graft campaign. The president’s statement revealed his determination to fight against corruption in the party and he warned that under the rule of law no one would be parroted, even for high-ranked officials.

• //Under the rule of law, no one should have the wishful thinking of being pardoned, as there is no such thing as ‘dan shu tie quan’ or ‘tie maozi wang’,” Xi said. His remarks were published last week in a collection of the president’s previously undisclosed internal speeches. The book was edited by the top anti-graft watchdog, the Central Commission for Discipline Inspection. The phrase “dan shu tie quan” refers to an iron certificate granting its holder immunity from punishment. “Tie maozi wang” translates literally to mean an “iron-capped king”, referring to those who enjoyed such privileges. //Source: SCMP, 05 January 2016.
• // Its purpose was to showcase the party’s attempt at establishing the rule of law, but it did so only in a superficial way, said Zhang Lifan, a Beijing-based political observer. “In terms of rule of law, recent cases such as that of Pu Zhiqiang have been a slap in the face of the hypocritical judiciary,” he said. “Even the procedures in the cases of Bo and Zhou were flawed.” Zhang said the party’s propaganda machine was highlighting the cases of imprisoned leaders to feed the “trivial curiosity” of the audience.// Source: SCMP, 07 January 2016.
• David Shambaugh from the George Washington University: // China also continued to wrestle with its widespread corruption problem during the year, with the party’s zealous campaign showing no signs of abatement. Several more major “tigers” were taken down: former internal security tsar and Politburo member Zhou Yongkang 周永康); former Central Military Commission vice-chairman and Politburo member Guo Boxiong (郭伯雄); and former Central Committee General Office director and Politburo Secretariat secretary Ling Jihua (令計劃). Rumours continue to circulate about several other former Politburo-level officials being in the sights of the Central Commission for Discipline Inspection. The anti-corruption campaign has thus far netted more than 200,000 officials at various levels since 2012, including more than 4,000 military officers and 82 generals. During the past year, financial securities brokerages, banks and regulatory bodies were targeted along with energy sector executives. The campaign is due to continue and deepen in the new year. The commission recently announced it will conduct “across-the-board” inspections into 280 ministries, local governments, state-owned enterprises and financial institutions. While having a cleansing effect, the campaign has also had the ancillary impact of a purge – spreading fear throughout the 45 million-member cadre corps and 88 million party membership. Everyone is fearful and frightened that the knock on their door could come at any time. As one long-time party member confessed to me in Beijing in November: “There is widespread fear and a complete lack of trust among party members today. Nobody trusts anybody. It is like the Cultural Revolution again.” As a result, the entire party-state system is frozen – and it is having a deleterious effect on both economic performance as well as the ethos within ruling institutions, even if the campaign remains highly popular with the public. Thus, ironically, a campaign meant to clean up and strengthen the party may be further weakening it.// Source: SCMP, 28 December 2015.

Society

5. The first anti-domestic Violence Law in China

On 27 December 2015, the Standing Committee of National People’s Congress passed the bill of anti-domestic violence. The law now covers children, elderly, people with disability, pregnant women, people with severe diseases. It also for the first time includes the concept of psychological violence and covers co-habitation of non-family members. Yet, the official denied the protection for co-habitated people to cover homosexuals. The law was said to have considered the extent to which public authorities should intervene intimate relations such as family relation. Culturally, many victims of domestic violence in China still regard this as ‘home business’ and thus refrain from resorting to legal means to protect themselves.

• //法律對未成年人、老年人、殘疾人、孕期和哺乳期的婦女、重病患者提供特殊保護；對無民事行為能力或限制民事行為能力的家暴受害人，設立強制報告制度，規定學校、幼兒園、醫療機構等發現情況後應及時向公安機關報案。若未能報案而造成嚴重後果，相關人員將依法受到處分。由於辱罵、恐嚇等精神暴力的嚴重性日益凸顯，《反家暴法》將精神暴力也納入家庭暴力範圍。隨着未婚同居或「離婚不離家」等情況的出現，法律亦在附則中指出，家庭成員以外共同生活的人之間的暴力行為將參照該法執行。然而，中國全國人大常委會法工委社會法室主任郭林茂，在回答美聯社記者關於「共同生活」的人是否包括同性戀的問題時，卻稱「對同性戀的到現在我們的法律沒有規定，也沒有這個事情」，後又稱「你所説的關於同性戀在我們國家，我們還沒有發現這種暴力的形式，所以給你個確定的回答，應該説共同生活人員不包括同性戀。」[…] 對於民眾提出的《反家暴法》尚存的諸多不足，郭林茂表示，由於中國家庭關係具有複雜性和特殊性，制定法律時必須綜合考慮多種因素，一方面要堅決反對家暴，另一方面也要考慮「公權力對家庭關係這種私人空間的介入程度」。但這種説法也被指偷歡概念、逃避責任。批評者認為，法律是對個人權利的保護，不同情況下的受害人都能找到法律依據來維護權益才是法律健全的標誌，況且中國民事案件也有「不告不理」的原則，這與公權力介入私人空間的説法完全不相干。《羊城晚報》也指出，反家暴法實施過程中還有不少「攔路虎」。在觀念上，許多人仍把家暴當成「家務事」，不會用法律手段維權。在訴訟程序中，不少受害人未保留傷情鑑定結果，令舉證成為難題。「人身安全保護令」雖是此次立法中一大亮點，但仍存在法院及公安機關權責不明的問題。// Source: The Initium, 29 December 2015.

6. The first acceptance of litigation on same-sex marriage in court

A court in Changsha, Hunan Province, has accepted a lawsuit from a 26-year-old to defend gay rights. Commentators said it is the first time a court will accept a case like this and they regard this as a positive step towards greater recognition of gay rights in China.

• //A court has accepted China’s first same-sex marriage case – lodged by a gay man against a civil affairs bureau for denying him the right to marry – in a decision hailed as a step forward for gay rights. While homosexuality is not illegal in China, and large cities have thriving gay scenes, same-sex marriage is not legal and same-sex couples have no legal protections. […] Activists said the court’s acceptance of the case was significant and would likely lead to more such cases. “In China, courts often reject politically sensitive cases, so the fact that the lawsuit is accepted signals some official willingness to address discrimination against LGBT (lesbian, gay, bisexual and transgender) people, which is encouraging,” said Maya Wang, a China researcher at New York-based group Human Rights Watch. […] “From the standpoint of improving visibility, this case is no doubt a victory,” said Ding, who declined to give her full name because of the sensitivity of the matter. Lu Jun, co-founder of anti-discrimination group Yirenping, said the case would bring more such legal action.// Source: SCMP, 06 January 2016.

Economy

7. CCP’s economic plan for year 2016

In late December 2015, the CCP’s Economy Works Leadership Meeting (中央經濟工作會議) was convened in Beijing to map out economic policy for next year. In an article by the Renminwang (人民網), three areas of concerns were highlighted. The first was about “supply-side reform” (供給側改革), which orderly re-structures supplies in the market by phasing out ineffective enterprises, tackling the overcapacity problem, and stimulating innovations. The second was to push for the ‘One-Belt-One-Road’ Initiative and international cooperation, and the third was to deepen financial reform and prevent systemic risk.

• //中国（海南）改革发展研究院经济研究所所长匡贤明在接受人民财经专访时表示，随着中国需求结构的不断升级和总量的不断扩大，供给的问题日益突出。但这深刻反映了我国的市场化改革还未到位，制约供给的一些体制机制性问题仍然存在。因此，在这个背景下提出供给侧改革，更多的是针对市场经济的某些不完善的地方进行改革。当前经济发展面临的一个突出问题便是部分行业的产能过剩。国务院发展研究中心副主任王一鸣近日表示，“我理解供给侧改革，就是让要素再流动起来，让资源从低效率领域转移高效领域，从已经过剩领域转移到更有需求的领域。”王一鸣建议，要建立一个有效的过剩产能的退出机制，特别是要能够有效地解决那些僵尸企业。//Source: 人民網, 20 December 2015.
• //近日，李克强总理在《经济学人》年刊《世界2016》上发表了一篇《中国经济的蓝图》的署名文章。其中，文章开篇就明确提出：2016年，中国将继续深化改革，扩大对外开放，拓展国际经济合作。李克强总理在文中进一步指出：中国正在推动“一带一路”建设。通过国际产能合作，将中国制造业的性价比优势同发达经济体的高端技术相结合，向广大发展中国家提供“优质优价”的装备，帮助他们加速工业化、城镇化进程，以供给创新推动强劲增长。// Source: 人民網, 20 December 2015.
• //习近平总书记在对《建议》进行说明时指出，近来频繁显露的局部风险特别是近期资本市场的剧烈波动说明，现行监管框架存在着不适应我国金融业发展的体制性矛盾，也再次提醒我们必须通过改革保障金融安全，有效防范系统性风险。11月9日，国务院新闻办举行吹风会，中央财经领导小组办公室副主任杨伟民提到，要对现行金融监管体制进行改革，具体改革方案还需要进一步研究和制定。匡贤明同样认为，监管体制的改革，尤其是金融监管将会是明年经济工作的重中之重，有望于本次中央经济工作会议确定方向。// Source: 人民網, 20 December 2015.

8. Encouraging migrant workers to buy flats in lower-tier cities

To strengthen the economy and to solve the problem with oversupply of housing in China, migrant workers are encouraged to buy houses in lower-tier cities. Yet, there are hurdles to this call: the readiness of the local governments to provide subsidies and the change to the hukou system.

• //The Communist Party of China Central Committee, the Party’s top decision-making body, identified major tasks on Monday for the government’s economic work in 2016. Among them, transforming migrant workers into « new urbanities » with full-fledged rights is highlighted. « Housing system reform should cater to new urbanities » to « boost effective demand and stabilize the housing market », the Committee said. […] It is also part of the economic « supply-side » reforms championed recently by top policymakers that aim to lift the country’s productivity, analysts said. Specifically, plans are being drawn to support farmers and migrant workers to purchase homes in third-and fourth-tier cities. Financial subsidies will be given to first-time homebuyers who have rural household residency, or hukou, according to Economic Information Daily, a newspaper affiliated with the official Xinhua News Agency.// Source: org. 19 December 2015.
• //地產物業常被用作銀行貸款抵押品，而土地出讓金又是地方政府重要的財政收入來源，因此房地產和金融，乃至地方財政，緊密相連。中央已經釋放信號，將化解房地產庫存的“希望”，放在了農民工身上。 […]中國領導層對於農民工轉變為“新市民”群體，並在整體經濟增長中發揮重要作用的重視，可從戶籍改革的推進中見一斑。11月，總理李克強就提出“以加快戶籍制度改革帶動住房、家電等消費”，這正與此次中央提出的“農民工市民化”一脈相承。國務院發展研究中心一位負責人向《華夏時報》表示，“農民工市民化後，除了通過對新市民降低信貸購房門檻、加大補貼優惠力度刺激市場成交之外，收購存量商品房作為保障性住房的需求也將被放大。”// SCMP (Chinese Edition), 18 December 2015.
• //While encouraging migrants to buy homes in lower-tier cities seems like a remedy to boost demand, making money available to them will prove tougher. Many of China’s more than 270 million migrants earn below 3,000 yuan ($462) a month, less than half the cost per square metre needed for a home in a lower-tier city such as Changzhou, in eastern Jiangsu province. With low incomes and few assets, migrant labourers are not obviously attractive loan candidates, and the authorities will need to find property developers willing to sell homes at a discount and local governments ready to subsidize purchases.// Source: Reuters, 04 January 2016.
• // Ni Pengfei, a research fellow at the Chinese Academy of Social Sciences, estimated that if 70 percent of migrant workers bought homes in the cities where they work, China’s 2.1 billion square meters of excessive inventory would be significantly depleted. However, the government is looking beyond the property market. Zhu Zhongyi, vice-president of the China Real Estate Industry Association, said implementing the strategy will entail deeper institutional changes. A change in the hukou system so that owning a home in a city is enough to qualify for an urban hukou is also needed, Zhu said. « Many lower-tier cities now still require more than local home ownership to get a hukou, » Ni said, pointing to the need for continuous work and social insurance payment records. « But that is difficult for many migrant workers because they work in larger cities and don’t have those certificates. »// Source: org. 19 December 2015.

9. Cancellation of the ‘circuit breaker’ mechanism in stock market and the RMB devaluation in the beginning of year 2016

To avoid the panicking sentiment to spread again since August 2015, the China Securities Regulatory Committee (CSRC 中國證監會) introduced the ‘circuit breaker’ mechanism (熔斷機制) to the A-share stock market, where stock exchange will be suspended if the market falls or rises by 5% for 15 minutes and by 7% for the whole day respectively. However, the system was quickly cancelled on 8 January 2016 as the stock market was quickly suspended for the whole day on the first day of its implementation (4 January) and also on 7 January 2016 within an hour after the market’s opening. In the meantime, The People’s Bank of China (PBOC) allows RMB (the yuan) to depreciate, triggering investors’ panic over China’s economic prospects and resulted in continued capital outflow from China. On 12 January, the PBOC intervened in the offshore market in Hong Kong in a bid to support the yuan, after the RMB was made one of the reserve currencies at the International Monetary Fund.

• //Trading of shares and index futures in the mainland was halted by automatic circuit breakers from about 9:59 a.m. after the CSI 300 Index slid more than 7 percent. The People’s Bank of China cut its reference rate on Thursday for an eighth straight day, fueling concern that tepid economic growth is prompting authorities to guide the currency lower. “The yuan’s depreciation has exceeded investors’ expectations,” said Wang Zheng, Shanghai-based chief investment officer at Jingxi Investment Management Co. “Investors are getting spooked by the declines, which will spur capital outflows.”// Source: Bloomberg, 07 January 2016.
• // Investors were cheered by news that China has strengthened its currency and scrapped a « circuit breaker » mechanism which halts trading when stocks plummet and has been blamed for aggravating market crashes all week. The circuit breaker system had only been in place for four days. The People’s Bank of China also raised its guidance rate for the yuan for the first time in nine trading days, having allowed the currency’s biggest fall in five months on Thursday.// Source: The Telegraph, 08 January 2016.
• //The PBOC intervened in the offshore yuan market during the past two days by buying yuan which drove the yuan interbank market to a record high 200 per cent Tuesday, up from 25 per cent Monday and from Friday’s level of 4 per cent. […] Han Jun, the deputy director of China’s office of the central leading group for financial and economic affairs is the latest mainland official to offer vocal support for the yuan. He said in New York on Monday in a Bloomberg report that currency traders who believe the yuan will fall substantially against the US dollar are “ridiculous,” and those who short sell the currency could be on the wrong track. […] The PBOC last night said it has six foreign institutions including central banks such as the Reserve Bank of India and Monetary of Singapore and Bank of International Settlements ready to enter China’s interbank foreign exchange market. […] Wilson Chan, associate director of the MBA Programme of City University of Hong Kong, said the PBOC appears to have won the battle with speculators but not the war. “This is just the beginning of a currency battle between PBOC and the currency speculators. This kind of battle has been seen in the 1992 British pound and the Thai Baht and other Asian currencies in 1998. Eventually, the central banks bowed to the market force,” Chan said. “The PBOC will need to fight for a long term battle which would expensive as it will cut down its forex reserve further.” China forex reserves have dropped more than US$600 billion from the all-time peak of US$3.99 trillion in June 2014.// SCMP, 12 January 2016.

Politics

1. Co-owners and employees of the Causeway Bay Bookstore mysteriously disappeared

The Causeway Bay Bookstore is selling politically sensitive books which are banned in Mainland China. Since October 2015, the co-owners of the Bookstore could not be contacted one by one. Five persons from the Bookstore, including co-owners and staff, were reported missing in the beginning. The one with widespread media coverage is the sudden disappearance of Mr. Lee Bo. Unlike the other four persons, Lee was reported missing in Hong Kong on 30 December 2015 by his wife. Later his wife said she had received a call from Lee who had mentioned Shenzhen and his need to cooperate for investigation, while having found that Lee’s travel permit to Mainland China was at home. This added fuel to the speculation that police officers from the Mainland have had come to Hong Kong and arrested Lee. Such move was largely regarded as a violation of the principle of ‘One Country Two Systems’. The state media denounced the discussion on the whereabouts of Lee Bo, saying opposition force in Hong Kong created the quarrel. A few days later, the Central News Agency of Taiwan reported that it had received a hand-writing letter written by Lee Bo, explaining that he has used ‘his own way’ to return to Mainland China to help investigation.

• // 12月30日，此前為同事報案的李波於下午5時45分獨自一人乘搭電梯離開位於柴灣書店倉庫後下落不明。他也是香港永久居民。李波太太蔡嘉蘋向警署報案失蹤，並稱收到過李波來電，手機顯示電話來自「廣東深圳」，而她在香港家中找到丈夫李波的回鄉證和護照，另外香港警方亦向她表示入境處並無李波的出入境紀錄。// Source: The Initium, 07 January 2016.
• //The mysterious disappearance of Lee took a dramatic twist on Monday, when Choi suddenly withdrew her request for police help, claiming she had been in touch with her husband after he vanished. Deepening the mystery, the Central News Agency published what it said was a handwritten letter faxed by Lee to a bookstore colleague. The letter stated that Lee “returned to mainland my own way and am working with the concerned parties in an investigation which may take a while”.// Source: SCMP, 06 January 2016.
• // 梁振英一再強調只有港執法機關在港可執法，他高度重視有港人下落不明的清況。根據一國兩制及基本法，只有香港執法人員有權在港執法，內地執法機關是無權在港執法，內地執法人員在港執法是不能接受，因為是不符合基本法。// Source: The Stand News, 04 January 2016.
• //借这个空档，反思一下铜锣湾书店的所作所为，也有几分必要。铜锣湾书店几乎专门出版、销售与内地有关的政治书籍，它们很多都包含恶意编造的内容，构成了对名誉权的严重侵犯。那些书籍通过各种渠道流进内地，成为一些政治谣言的源头，在一定范围内造成恶劣影响。虽然铜锣湾书店存在于香港的环境中，但它实际上就是靠给内地社会捣乱维持生存的。它利用回归后内地人大量进出香港，把自己搞成向内地提供“禁书”的一个突出源头，不能不说它变相插足了内地的事情，损害了内地保持和谐稳定的重大利益。铜锣湾书店像是要刻意在香港与内地之间拱出一块灰色地带，以挑衅的政治方式为自己谋利。香港少数人是给国家出了难题的。“一国两制”是很好的设计，当初内地社会都为它的确立而高兴、骄傲。大家想得很简单，真心愿意香港回归祖国后继续保持资本主义制度，也保持有特色的社会风貌，几乎没有想过后来出现香港一些人的反中央倾向。一些人张狂地要把香港搞成在政治上对抗国家的桥头堡，这尤其出乎内地很多人的意料。// Source: Global Times (Chinese Edition), 04 January 2016.
• //铜锣湾书店虽开在香港，但它很大程度上面向内地读者出版、销售政治书籍，因而事实上双脚跨到香港和内地两个社会中。它给内地维护秩序制造了特殊干扰，挖了内地法治的墙脚。内地围绕它开展调查，不仅“理”站得住脚，也是符合中国法律的。至于让李波出现在内地“有关部门”符合不符合《基本法》，关键看李波是以什么方式进入内地的。如果是内地警员去香港对李波采取强制行动，把他“五花大绑”塞进警车带过检查站，那肯定不行。然而全世界的强力部门通常都有规避法律让一个被调查者进行配合的办法，既达到开展工作的目的，又不跨越制度的底线。有一点很重要，香港法律与中华人民共和国法律不是对抗的关系，前者不是用来掩护一些人或机构危害国家安全的专门制度安排。如果一些力量把香港的法律空间朝着对抗国家的极致使用，就说不准什么时候踩到危险的边界上。如果是普通人，没有做特殊斗争的准备，就不应把自己推向极限的地带。香港热衷反对派政治的人还是要搞清“一国两制”的实质含义，不应幻想“两制”高于“一国”，认为在香港怎么搞危害内地和国家的行动都没事。把这个问题想通了，就更容易把各种细节真正看清楚。// Source: Source: Global Times (Chinese edition), 06 January 2016.
• //民主黨立法會議員涂謹申表示，環球時報的“社評演繹令人震驚”，認為香港出入境管制屬特區自治範圍之一，如內地有“強力部門”認為可繞過特區的出入境管製做事，“是非常不尊重一國兩制”，質疑“是否與國家主席習近平打對台”。記協及獨立評論人協會均發聲明批評該社評“言論荒謬、令人震驚、製造白色恐怖”，兩團體促請港澳辦、中聯辦及特區政府澄清香港與內地是否存在“規避法律”，令基本法蕩然無存。 //Source: RFI, 07 January 2016.

The incident soon became a diplomatic matter when it was found out that Lee Bo owns a UK passport. The Foreign Ministry of the United Kingdom Philip Hammond expressed concerns that one of the missing persons in the incident is a British national. The Chinese Foreign Minister Wang Yi (王毅) refused foreign intervention of the case and said the person in question is ‘first and foremost a Chinese citizen’.

• //Hammond voiced concern that Lee’s possible removal to the mainland would represent a major blow to the “one country, two systems” formula under which Hong Kong has operated with partial autonomy from Beijing since its return to China in 1997. Those rules outlaw mainland police from operating in Hong Kong and give Hong Kong judicial independence from authoritarian China. Hammond said: “Just responding to the speculation that we’ve seen, it would not be acceptable for somebody to be spirited out of Hong Kong in order to face charges in a different jurisdiction. It is an essential part of the settlement in Hong Kong that it has its own judicial system and it is solely responsible for trying offences that occur in Hong Kong.”/ / Source: The Guardian, 05 January 2016.

• // The disappearance of Lee Bo took a diplomatic twist in Beijing last night when China’s Foreign Minister, Wang Yi, described the missing Hong Kong bookseller as “first and foremost a Chinese citizen”. Wang was responding to questions during a joint press conference with British Foreign Secretary, Philip Hammond, who is in the capital to sign business deals as the economic relationship between the two nations grows.// Source: SCMP, 05 January 2016.

Other staffers or co-owners of the Bookstore disappeared for some time. For example, Gui Minhai (桂民海), who is a Sweden citizen, was rumoured to be caught while he was in Thailand. On 17 January, Gui Minhai appeared on CCTV and made confession to the crime he did a decade ago, citing this as the reason for his voluntary return to Mainland China and asked Swedish government not to intervene as he regards himself as a Chinese.

• //The publisher claimed he had voluntarily surrendered to Chinese authorities in October last year over his supposed involvement in a fatal hit-and-run incident in the city of Ningbo in December 2003. Gui said he had fled mainland China after the incident, in which a young woman was killed, but had been driven to return last year out of guilt and a sense of longing for his homeland. “It is my own choice to come back and to confess my crime. It is nobody else’s business. I need to take responsibility for it myself,” he said in the televised confession.// Source: The Guardian, 18 January 2016.
• //In his televised confession, Mr. Gui told Swedish officials that he voluntarily went into Chinese custody. Mr. Gui, who studied poetry at Peking University, became a Swedish citizen in 1996, according to Xinhua.“ I do not want any individual or organization, including Sweden, to involve themselves in, or interfere with, my return to China,” Mr. Gui said in the televised report. “Although I have Swedish citizenship, I truly feel that I am still Chinese — my roots are in China. So I hope Sweden can respect my personal choice, respect my rights and privacy of my personal choice and allow me to resolve my own problems.”// Source: New York Times, 17 January 2016.

Zhang Zhiping (張志平), who was the business manager of the Bookstore, was rumoured to be caught in Dongguan, while Lin Ronji (林榮基), who was the Chief Manager and the founder of the Bookstore, was caught in Shenzhen. The son of Lin Ronji accused the Hong Kong Police of being unhelpful and unreliable in finding his father. Mr. Lu Bo (呂波) who was General Manager of the Bookstore, was also said being caught in Shenzhen.

• //持有銅鑼灣書店的巨流傳媒瑞典籍股東桂民海，報稱去年10月在泰國住所被帶走，其妻於11月接獲桂民海「報平安」電話，而桂民海身在英國的女兒，早前已向瑞典駐英使館求助，但至今仍音訊沓然。瑞典外交部今日回覆本報指出，嚴正看待（takes a very serious view）有關一名約50歲瑞典籍人士，疑於泰國或中國非自願地失蹤。// Source: MingPao, 05 January 2016.
• //林榮基是香港人，下月60歲。他在1994年創辦了「銅鑼灣書店」，至今已經營了20年，在行內無人不識。2014年，他將書店賣給了「巨流傳媒有限公司」，他本人則在賣盤後留任擔任店長。買下書店的巨流傳媒有限公司，分別由桂民海、李先生的妻子及呂波三人持股，其中呂波還擔任總經理，另外聘請了張志平任公司的業務經理。[…] 11月6日早上，海外媒體博訊披露「銅鑼灣書店」與「巨流傳媒」老闆及員工4人突然失蹤的消息。// Source: The Initium, 10 November 2015.
• //李波11月6日接受端傳媒採訪時告訴記者：「警方很配合，並囑我們要去入境處查記錄。」但後來，他陪同林太到香港入境處，入境處職員說需要警方查，等兩人返回警署後，警方態度開始有變。「警方不再如之前般配合，並且告訴我說，『背後的水很深』」李波早前對端傳媒記者說。林榮基20多歲的兒子告訴記者，也是在11月6日——報案次日黃昏，林太突然收到失蹤多時的林榮基打來電話報平安，內容大抵為「我很安全，過一陣子回來，請勿擔心」。而收到電話後不久，林太便收到警員電話，問林太是否剛剛收到林榮基打來的電話——似乎警員早已知道林榮基曾經來電。其後，警署回覆林太：「不會再調查（林榮基失蹤一案），因為林榮基已經打電話來報平安，就不是失蹤人口」。「我和母親現在也不知道怎麼辦，根本沒人可以幫我們。」林榮基兒子說母親自11月6日之後就再沒有收到林榮基的任何消息。「不可以依賴香港警察，他們不會再查，他們根本就是公安。你叫李太也不要信香港警察。」他對端傳媒記者說。// Source: The Initium, 07 January 2016.

Similar prosecutions happened in the past. Another related case was the arrest of Yiu Man-tin, also known as Yao Wentian, (姚文田) who are the chief editor of Morning Bell Press which often publishes politically sensitive books in Hong Kong. He was caught by the Mainland Police in Shenzhen in October 2013. He was later tried in May 2014 and convicted as ‘smuggling ordinary goods’ with a 10-year jail term. His case is perceived to be related to the publication of one book titled, Xi Jinping: China’s Godfather, by the controversial dissenter Yu Jie, as well as past publications critical of the Chinese authorities.

• // A Shenzhen court sentenced Hong Kong publisher Yiu Man-tin to 10 years in jail yesterday for « smuggling ordinary goods », his lawyer said. The retired engineer-turned-publisher, 73, who is also known as Yao Wentian, was detained on October 27. Prior to his arrest he had been preparing to publish a book entitled Godfather Xi Jinping by dissident and writer Yu Jie, according to his family and friends. For media report, please see here by SCMP.

2. Potential Implication of China’s Anti-Terrorism Law for Hong Kong

Jonny Yui-siu Lau, a Hong Kong-based political commentator, believed that people in Hong Kong do not need to worry much about the counterterrorism law for the time being as the law is originally targeted at activities within Mainland China. Yet, as the right to interpete the law lies in the mainland officials, he argued that the worries by Hong Kong people is not unsubstantiated given the records in the past years such as the case of Pu Zhiqiang.

• //從立法動機來看，此法針對內地，多於針對香港；從實施範圍和司法程序來看，此法主要在內地行使，在香港應用的機會暫時不大，因為內地法律不在香港實施，此法也沒有納入《基本法》附件三。可見，港人毋須過分擔心。不過，話雖這樣說，但此法還是令很多香港人擔心，內地人就更不用說了。為甚麼？這就要談到中國對法律是否真正尊重？中國官方的行為有否足夠的透明度？更重要的是，有沒有平衡的力量監督和制約官方行為？[…]《反恐法》不在香港實施，但官方如有需要，大可把《反恐法》解釋為「與國防有關」，把它納入《基本法》附件三。官方如針對特定人物，只要這個人踏足大陸，內地又可借其他法律和「證據」之名，行「罰」法無邊之實。 我不是刻意引起人們對《反恐法》的恐慌，而是《反恐法》本身和官方的長期行為已足以引起恐慌。君不見浦志強案，以及法國記者被變相驅逐出境的事件，主動權和解釋權都在中國官方。外國人尚有一點保障，但中國人呢？ // Source: AM730, 29 December 2015.

Politics

1. Presidential and Legislative Election

For the brief of the first presidential candidate debate, please find it here prepared by The Initium (in Chinese). On the Cross-strait relation between Mainland China and Taiwan, the positions of presidential candidates towards “92 Consensus” drew attention in the first presidential candidate debate. DPP presidential candidate Tsai Ing-wen did not explicitly mention her support for “92 Consensus” but agreed to the spirit of mutual understanding on both side of the Strait on which the cross-strait relation can further develop. She also regarded the “92 Consensus” as one of the options but not the only option in dealing with Mainland China. KMT presidential candidate Chu Li-luan said he would continue the recognition of “92 Consensus” for the peaceful development and cooperation of both Mainland China and Taiwan. People First Party (PFP) presidential candidate Soong Chu-yu argued that the Mainland must first recognize the existence of the Republic of China, and Taiwan should emphasize its advantages in the dealing with Mainland China. According to the last public polling, the DPP Presidential Candidate Tsai Ing-wen continued to lead by a large margin. Meanwhile, the number of overseas Taiwanese going back to Taiwan for the vote dropped to a record low.

• //蔡英文顯然知道國際間都想知道她對九二共識的看法，因此她說： 「國民黨常恐嚇台灣人民要接受九二共識，不斷質疑，沒有九二共識如何維持現狀？我要強調，民進黨沒有否認1992年兩岸會談的歷史事實，也認同雙方當時都秉持相互諒解的精神求同存異，希望兩岸關係往前推進的這一段協商溝通跟經過的事實」[…] 朱立倫反擊「九二共識是國民黨創造」的說法，特別說明了其實是台灣先提出，然後大陸經過五六年研究之後同意使用的。他強調，從九二共識這個基礎到十一月七日兩岸最高領導人在對等尊嚴的國際場域見面，國際能見度大為提高，他有信心未來台灣國際空間也能提升，這是因為國民黨採取了一個正確且符合台灣人民利益的兩岸路線。未來他若當選，將繼續堅持九二共識的正確政策，不但推動兩岸和平發展，還要促進兩岸合作雙贏。 […] 朱立倫和蔡英文對九二共識針鋒相對之際，親民黨總統候選人宋楚瑜顯得被邊緣化，親民黨的立場當然主張和大陸交往，但九二共識卻顯然是國民黨的檯子。宋楚瑜說： 「因此，我們在面對中華民國存在當中，大家最感關心的問題就是，我們是不是應該和對岸維持良好的關係，讓中華民國能和對岸和平相處，和平發展，因此宋楚瑜主張兩岸一家親，共同爭取海峽兩岸的和平，因此，與其消極地爭取台灣優先，不如積極發揮台灣的優勢，和大陸相處當中，不是要求對方讓利，而是應發揮台灣優勢，永保台灣優勢」//Source: RFI, 27 December 2015.
• //蔡英文表示，1992年兩岸在香港會談，會談中大家有不同意見，但至少同意一件事，秉於相互諒解、求同存異讓兩岸關係往前推動，「這段歷史事實我們是沒有否認，而且我們是接受」。蔡英文強調，繼續求同存異，好好坐下來談，相信中國大陸方面會秉持理性態度和民進黨互動。[…] 她並強調，「九二共識是選項，但非唯一選項」。朱立倫則表示，他在25日的電視政見發表會中，就堅持「九二共識」，他對兩岸合作持正向態度。國民黨的共識就是堅持「九二共識」、「一中各表」，這是國民黨的立場，從來沒有改變。宋楚瑜說，支持「九二共識」，「九二共識」不是文件，是兩岸的默契，應善用政治槓桿，及積極與對岸談判，讓對岸曉得台灣是有主權的政府，「如何善用政治槓桿溝通談判讓紅利共享，合則兩利，兩利則合」。[…] 他也提出「九二共識」和兩岸基本最大公約數，其中一點就是尊重中華民國存在的事實。// Source: Central News Agency, 27 December 2015.
• //「總統副總統選舉罷免法」規定選前10日不得公布民調，台灣指標民調搶在31日「壓錶」前發布選前最後一波調查，民進黨總候選人蔡英文以支持度1％持續領先、國民黨總統候選人朱立倫17.5％、宋楚瑜則大幅增為16.8％、不投或廢票10.6%、未表態15.1%。依照台灣指標民調推估，藍綠版圖加權參數計算得票區間為「英仁配」52%~54%、「朱玄配」24%~26%、「宋瑩配」22%~23%，支持度交叉分析如後（+%,-%是相較12月上期調查）。//Source: ET Today, 31 December 2015.
• //明年1月16日的總統及立委大選進入倒數16天，中選會31日赴行政院報告總統、副總統及立委選舉籌備情形，這次海外僑胞申請返國投票登記的有2425人，符合資格者僅2317人，創下民選總統以來新低。僑委會委員長指出，選情冷為主要原因。僑委會委員長陳士魁接受《中央社》訪問時表示，海外僑胞登記返國投票人數創新低，主因可能在於今年選情冷，另一個可能原因是許多僑胞的子女都在台灣定居，不需再登記返國。陳士魁也補充，以往總統大選，美國僑胞都會揪團訂機票或提供廉價航空機票，但今年相關訊息都減少。//Source: Storm Media, 31 December 2015.

Economy

1. Taiwan’s trade with Mainland China

After China and South Korea signed free trade agreement on 20 December 2015, it is expected to have negative impact on Taiwan’s economy in medium and long term because Mainland China is Taiwan’s major trading partner. Presidential candidates of Kuomintang (KMT) and Democratic Progressive Party (DPP) both agreed to the doctrine of free trade, while KMT’s candidate Chu Li-luan urged to have the controversial free trade agreement directly with Mainland China, the DPP’s candidate Tsai Ing-wen vowed to help Taiwan to get into the Trans-Pacific Partnership (TPP) following the model used by the Japanese government.

• //中國與韓國、澳洲分別訂立的自由貿易協定（Free Trade Agreement，簡稱FTA）於12月20日同時生效。由於台、韓產業出口結構相近，且均以中國大陸為主要出口市場，中韓自貿協定料將為台灣經濟帶來衝擊。中韓於今年6月簽署自貿協定時，台灣經濟部曾發布評估報告稱，該協議生效第10年和第20年時，台灣實質GDP將分別下降約0.13%和0.15%；協議對台灣產業的影響也將逐漸浮現，長期來看可能影響紡織成衣、玻璃、鋼鐵、汽車、偏光板、面板、工具機等產業。[…] 有分析稱，自由經濟議題將牽動台灣明年總統大選的選情。國民黨總統參選人朱立倫今年11月接受訪問時表示，服貿和貨貿都是台灣必須要做的，前提是要盡快通過《兩岸協議監督條例》，以免相關協議被污名化為「黑箱操作」。民進黨總統參選人蔡英文此前也表示，自由貿易經濟應該做，如果明年當選總統將會推動台灣加入TPP，並參照日本「TPP政府對策本部」模式在台灣行政院設立專責機構，全力推動這項任務。// Source: The Initium, 21 December 2015.