China Reform Monitor: No. 746

February 6:

The Associated Press reports that despite plunging exports, factory closures, and more than 20 million people thrown out of work, official data from Beijing shows the domestic economy is still growing strongly. Beijing uses a method that compares growth in one quarter with a full year earlier and says its economy expanded by a healthy 6.8 percent in the final quarter of 2008. But Merrill Lynch economist Ting Lu and other experts say that compared to the previous three months – the system used by most other major countries – China's growth in the fourth-quarter growth was "close to zero."

Japan took advantage of its position as the rotating president of the Security Council to put its Security Council membership back on the table. China can prevent Japan from gaining entry into the Security Council, but Beijing’s biggest concern is the failure of UN reform more broadly and a growing “vacuum” on the UN. Thus, the official Zhongguo Tongxun She reports, “China will not insist on opposing Japan's entry into the Security Council” and will allow Japan’s entry if it makes "limited concessions" on the Japan's history textbooks and the Yasukuni Shrine issues. However, China's “real reason” for agreeing is to push Tokyo away from “its military alliance with the United States.”

The state-run Zhongguo Tongxun She has questioned the condition of the Russian military forces. “Russia's economic difficulties have led to a serious decline in its army training levels; even though soldiers participating in reviews have gotten brand-new uniforms and are equipped with the most advanced weapons, troop formation is obviously not uniform, and the fancy clothing cannot cover up the decline in army training levels' fighting strength.” The article, which was on the 60th national People’s Liberation Army’s troop review, also said Beijing feared that “domestic and foreign hostile forces wishing to take advantage of the opportunity presented by this [economic] chaos, or restless and ready to make trouble out of the need to divert their own economic conflicts, gravely threaten the nation's security.” It was unclear which “hostile forces” the author had in mind.

February 9:

Hours after an unauthorized fireworks display burned down the China Central Television (CCTV) headquarters in Beijing, authorities issued a notice to all Chinese websites that only the official version of the report should be publicized and banned all comments about the incident, Hong Kong’s Apple Daily reports. The order was issued by Network News Administrative Department of the Internet Propaganda Administration, which said that only the Xinhua version of the report could be circulated. Before the order was issued, the official Global Times website had already posted the news, and all major websites followed suit. “Without approval, no pictures or video recordings should be published, and no netizens are allowed to make comments,” the official circular said.

February 10:

“As the instigator of the financial crisis,” China’s official Xinhua News Agency said, “the United States should take more responsibilities in resolving the crisis and promoting world economic development.” It also criticized the "Buy America" language in the U.S. economic recovery bill and attacked what it calls “rising [U.S.] trade protectionism.” It claims the provisions have “triggered a wave of censures” around the world and “would ignite a trade war.” Not only would the "Buy America" provisions provide “tremendous encouragement to global trade protectionism and will inevitably exacerbate international trade disputes but it will further damage the United States' image.”