Breaking with their usual practice when it comes to train wrecks and other disasters of human origin, there has been little evidence of China’s leaders this week in the wake of the latest “Black Monday,” the worst day for Chinese shares since 2007. Actually, there has been little sign of them since the People’s Bank of China (PBOC) suddenly devalued the yuan on Aug. 11, triggering the currency’s biggest one-day loss in two decades.
However, some standard operating procedures appear to have been followed this week: one, restrict mention of the problem in the local media; two, announce a probe into suspected illegal actions by low-level players; three, blame outsiders, especially Western governments, for creating the problem in the first place or hyping it up; four, cry victim; five, praise the leadership for its acumen and bravery and, six, above all else, never let facts interfere with announced policies.
As usual, any problem, big or small, cannot be seen to be the fault of the Chinese Communist Party, because that might lead to criticism of the party, its leadership and the nation’s political structure. The party’s Teflon coating, while flaking fast, means that scapegoats must be found elsewhere.
Chinese shares have been in trouble since early June, and the Shanghai bourse’s main index has fallen more than 40 percent since then. The move to accuse some local securities firms of manipulating prices — as occurred on Wednesday — was followed by a one-two punch on Thursday of Chinese media commentaries lambasting their foreign counterparts for being doomsayers and fanning fears of a crisis and a top PBOC official telling Reuters that this week’s roiling of Chinese and global stock markets was not down to China’s exchange rate reform, but fears about the US Federal Reserve raising interest rates.
“We were wronged,” PBOC Research Institute of Finance and Banking Director-General Yao Yudong (姚余棟) said.
However, there is plenty of evidence available that the government, the PBOC and other officials were more than happy to act as cheerleaders when the Chinese stock market turned bullish earlier this year, and they sought to encourage Chinese to invest and to consume more to boost the national economy. So obviously someone erred, somewhere.
However, the lack of independent and transparent regulatory authorities and an independent financial press in China has long been a burden on the economy in terms of investment by both locals and foreigners and has also handicapped Chinese corporations seeking to become global players.
In addition, Chinese President Xi Jinping’s (習近平) vaunted anti-corruption crackdown, in addition to its political score-settling side, has actually made it more difficult to learn about Chinese corporations, as will the national security law passed by the National People’s Congress early last month and the cybersecurity law that is still in the draft stage.
Many analysts believe the Chinese government will attempt to prop up the markets in the coming days, to prevent the economic turmoil from overshadowing next week’s commemorative efforts marking the end of World War II, especially the massive military parade scheduled for Thursday in Beijing.
What happens after that is anyone’s guess.
However, this week, if not the entire month, has been a reminder that Chinese politics and economics operate on a very different playing field from the rest of the world and we should forget that at our peril.
This is a lesson that many in Taiwan have for too long been willing to ignore, be it the corporate titans’ rush to tap the China market for cheap labor, land and less restrictive environmental laws or President Ma Ying-jeou (馬英九) and the Chinese Nationalist Party (KMT) brethren eager to boost ties with Beijing.
Saudi Arabian largesse is flooding Egypt’s cultural scene, but the reception is mixed. Some welcome new “cooperation” between two regional powerhouses, while others fear a hostile takeover by Riyadh. In Cairo, historically the cultural capital of the Arab world, Egyptian Minister of Culture Nevine al-Kilany recently hosted Saudi Arabian General Entertainment Authority chairman Turki al-Sheikh. The deep-pocketed al-Sheikh has emerged as a Medici-like patron for Egypt’s cultural elite, courted by Cairo’s top talent to produce a slew of forthcoming films. A new three-way agreement between al-Sheikh, Kilany and United Media Services — a multi-media conglomerate linked to state intelligence that owns much of
The US and other countries should take concrete steps to confront the threats from Beijing to avoid war, US Representative Mario Diaz-Balart said in an interview with Voice of America on March 13. The US should use “every diplomatic economic tool at our disposal to treat China as what it is... to avoid war,” Diaz-Balart said. Giving an example of what the US could do, he said that it has to be more aggressive in its military sales to Taiwan. Actions by cross-party US lawmakers in the past few years such as meeting with Taiwanese officials in Washington and Taipei, and
The Republic of China (ROC) on Taiwan has no official diplomatic allies in the EU. With the exception of the Vatican, it has no official allies in Europe at all. This does not prevent the ROC — Taiwan — from having close relations with EU member states and other European countries. The exact nature of the relationship does bear revisiting, if only to clarify what is a very complicated and sensitive idea, the details of which leave considerable room for misunderstanding, misrepresentation and disagreement. Only this week, President Tsai Ing-wen (蔡英文) received members of the European Parliament’s Delegation for Relations
Denmark’s “one China” policy more and more resembles Beijing’s “one China” principle. At least, this is how things appear. In recent interactions with the Danish state, such as applying for residency permits, a Taiwanese’s nationality would be listed as “China.” That designation occurs for a Taiwanese student coming to Denmark or a Danish citizen arriving in Denmark with, for example, their Taiwanese partner. Details of this were published on Sunday in an article in the Danish daily Berlingske written by Alexander Sjoberg and Tobias Reinwald. The pretext for this new practice is that Denmark does not recognize Taiwan as a state under