China Reform Monitor: No. 1201

December 19:

Last week a U.S. B-52 bomber "unintentionally" flew within two nautical miles of an artificial island China has built atop Cuarteron Reef in the Spratly archipelago of the South China Sea. Chinese military personnel on the island went on high alert and warned the aircraft to leave. The bomber was one of two on a routine mission and due to bad weather ended up flying close to the reef, Kyodo news reports. "There was no intention of flying within 12 nautical miles of any feature. [The B-52 flight] was not a freedom of navigation operation," said a Pentagon spokesman. China's Defense Ministry condemned the "serious military provocation," demanded Washington immediately act to prevent such incidents, and said it would do what was necessary to protect China's sovereignty. In late October, a U.S. navy destroyer sailed within 12 nautical miles of another Chinese-built island in the Spratlys. Two American B-52s flew close to the islands last month, the South China Morning Post (SCMP) reports.

December 25:

China has started construction on its third large hydropower station on the upper reaches of the Yangtze River (aka the Jinsha River) at the cost of 100 billion yuan ($15.4 billion). The 270-meter-high Wudongde dam will be the world's 7th largest, forming a reservoir for about 7.4 billion cubic meters of water. By 2021, the dam's 12 generators will have a capacity of 10.2 gigawatts, producing 38.9 billion kwh of electricity per year. Construction will require more than 16,000 workers and "about 31,000 residents in ten counties and districts in Yunnan and Sichuan will be relocated to make room for the project," the official Shanghai Daily reports.

[Editor's Note: The other two hydropower stations on the Jinsha River, Xiluodu and Xiangjiaba, began operation in 2014. Xiluodu is China's second largest dam, with power-generating capacity of 12.6 gigawatts. The Three Gorges dam on the Yangtze's middle reaches is the country's largest, with a capacity of 22.4 gigawatts. Baihetan, a fourth hydropower project planned on the Jinsha River, has yet to receive final government approval.]

December 26:

China's only aircraft carrier, the Liaoning, recently conducted drills in the Bohai Strait adjacent to the Korean Peninsula. Carrier-based J-15 fighter jets took off from, and landed on, the Liaoning, Yonhap reports, without revealing the date of the drills. Meanwhile, three Chinese Coast Guard vessels, including one equipped with "cannons," were spotted near the disputed Diaoyu Islands in the East China Sea, Bloomberg reports. It was first time that China Coast Guard vessels with gun turrets were spotted entering the area, the Japanese Coast Guard said, but it would have marked the PLA Navy's 35th intrusion this year in disputed waters and the 139th since September 2012. Last week, during their 34th incursion, one of two Chinese ships warships responded to a Japanese patrol boat's warning by telling it to leave "China's territorial waters."

December 27:

Amid sweeping military reforms and hundreds of thousands of job cuts, Xi Jinping, chairman of the Central Military Commission, paid his first visit to the PLA Daily since he took power in 2012. "Military propaganda work and an excellent public opinion environment must be created for advancing the national defense and military reforms," the president said. Xi's visit coincided with the first day of the paper's new editor-in-chief, Major General Sun Jilian, former director of the PLA television propaganda center, who replaced Major General Tan Jian. "The PLA Daily must step up political awareness and strictly implement the requirement of having the newspaper run by political staff to ensure only those loyal to the party control the newspaper," Xi said. He called for the paper to uphold the party's leadership over the army, maintain consistency among the leadership, and rally support for the reforms from the PLA's rank and file, SCMP reports.

[Editor's Note: Last month the PLA Daily carried a rare article expressing concerns that Xi's reforms could destabilize the armed services and society if they went ahead without addressing the issues of salaries and pensions. Such a public show of concern in the military's leading mouthpiece suggested Xi's ambitious plans have met some resistance from within the military.]

December 29:

China and Taiwan began operating the first telephone hotline between the two sides, set up as a confidence-building and tension-reducing measure. Zhang Zhijun, the head of the Taiwan Affairs Office, and Andrew Hsia, the head of Taiwan's Mainland Affairs Council, exchanged New Year's greetings. The step was agreed during the historic meeting between President Xi Jinping and Taiwan President Ma Ying-jeou in Singapore last month, the New York Times reports.