China Reform Monitor: No. 1074

December 5:

After meeting with President Xi Jinping, Ukrainian President Victor Yanukovych announced a “strategic partnership” with Beijing that “includes military aircraft construction, shipbuilding and energy.” The two leaders inked a dozen agreements allowing $8 billion in Chinese investment to flow into Ukraine’s transport, energy and agriculture sectors. “Soon China will build ports and plants here, produce gas from coal and consume our grain,” reported Ukraine’s ICTV television station. Next year construction will begin on a deep-water port for large vessels in Saky, located on the western side of the Crimean peninsula. The Chinese-built port, which will take four-years to complete, is expected to net Ukraine’s government $1.5-$2 billion per year in duties. The Motor Sich aircraft engine company will repair and dispatch several hundred engines for Chinese military helicopters and planes. Another $3.6 billion contract, this one with the Chinese Bank for Reconstruction and Development, will support construction of a coal to gas conversion plant in Luhansk. Beijing will also help with the construction of an airport express rail link, the purchase of Ukrainian grain, and increasing the number of Chinese tourists to Ukraine.

December 6:

Qiu Guohong, the Foreign Ministry’s director of external security affairs and former ambassador to Nepal, has held talks with senior Nepali officials on Nepal-Tibet border security and “controlling anti-China activities in the Nepalese soil,” Nepal’s Kantipur and Himalayan Times report. Qiu lauded Nepal’s efforts to control anti-China activities and said China will continue assistance to Nepalese security agencies. He noted progress in the construction of a new Armed Police Force Academy, which is being built with Chinese assistance. During a trip to Nepal, Chinese State Councilor Yang Jiechi agreed to build the academy, a commitment that came a few months after India agreed to construct a new police academy for Nepal.

December 11:

Zhou Yongkang, one of the most powerful Chinese politicians of the last decade, is under house arrest for corruption. Zhou is the most senior CPC official ever accused of graft. He was security chief and a member of the pre-eminent CPC Politburo Standing Committee before retiring last year. “Zhou Yongkang’s freedom has been restricted. His movements have been monitored,” a source told Reuters, he cannot leave his home or receive guests without approval. In October, Zhao Hongzhu, one of the party’s top anti-corruption officials, said anyone who violated party discipline would be punished “regardless of who it involved, how much power he has or how high his position is.” Then, last month, Xi Jinping ordered a special task force look into accusations against Zhou. The decision broke an unwritten rule that Standing Committee members would not be investigated after retirement. “Xi has pulled out the tiger’s teeth,” the source said. “The Central Commission of Political Science and Law has been cleansed of Zhou’s men,” he said, referring to the powerful party body Zhou once headed that oversees the police force, the civilian intelligence apparatus, judges, prosecutors and paramilitary police.

[Editor’s Note: Zhou was a patron of Bo Xilai, who was jailed for life in September for corruption and abuse of power in the worst political scandal since the 1976 downfall of the Gang of Four. “Xi Jinping and Li Keqiang hate Zhou Yongkang as he was the only standing committee member who opposed ousting Bo Xilai. They are gunning for Zhou,” a source told Reuters.]

The official military newspaper, Zhongguo Guofangbao, criticized the new war simulation video game “Battlefield 4.” The People’s Liberation Army is upset about how its forces are portrayed in the game, whose story takes place in 2020 when domestic unrest in China leads to a war with the U.S. In the scenario, American soldiers attack Shanghai and then cooperate with the Chinese government to take down the rogue Chinese general responsible for the conflict. Battlefield 4 has not been officially released in China, but is available on the black market and at Internet cafes.

December 13:

The USS Cowpens, a U.S. Navy guided-missile cruiser, took evasive action to avoid colliding with a Chinese warship in the South China Sea. The U.S. ship was in international waters conducting surveillance on China’s new aircraft carrier the Liaoning when a smaller vessel peeled off from the group of Chinese flotilla and came racing toward it. Despite radio warnings from the Cowpens, the Chinese ship proceeded past the ship’s bow. During the encounter, bridge-to-bridge radio communications were maintained between the U.S. and Chinese commanders. “The Chinese knew what they were doing,” a U.S. military official said in comments carried by CNN.