News » Society » How to get to the top of China's Party

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• How to get to the top of China's Party
• Agricultural authorities have culled about 95,000 chickens following an outbreak of the H5N1 bird flu virus in northwest China.
• Calm call on raid death
• South Korea has called for a calm and cool- headed resolution after the death of a mainland fisherman during a raid, urging that the incident not raise bilateral tensions.
• Painful playtime as doctors find sex toy
• Chinese navy conducts joint exercise in East China Sea
• Health care improvement
• Disabled mother, son complete hard trek
• Hospital attacker gets life in jail
• Presale houses cause problems for buyers, developers
• Increasing stress levels generate concern
• 8 bus crash victims now out of critical condition
• Nestle to Battle Starbucks in Chinese Premium Coffee Market
• WTO hands Obama victory in U.S.-China steel case
• China practices stopping "illegal entry" near disputed seas
• China Faces Tough Choice on Growth
• Have You Heard…
• VIDEO: Fresh tensions in island dispute
• China becomes third biggest tourist source for New Zealand
• Chinese life expectancy to hit 75.8 years by 2015

How to get to the top of China's Party Posted: 19 Oct 2012 05:23 PM PDT How to climb to the top of China's Communist Party

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Chinese navy conducts joint exercise in East China Sea Posted: 19 Oct 2012 10:25 AM PDT Chinese civilian maritime authorities and the People's Liberation Army (PLA) Navy conducted a joint exercise in the East China Sea yesterday which simulated handling illegal entry by foreign vessels. A total of 11 vessels, eight aircraft and more than 1,000 personnel from the PLA Navy's Donghai Fleet, China's fishery administration and marine surveillance agency took part in the routine exercise, according to a statement from the fleet. This posting includes an audio/video/photo media file: Download Now

Health care improvement Posted: 19 Oct 2012 10:15 AM PDT THE average life expectancy for the Chinese will reach 75.8 years by 2015, a year longer than the 2010 level. Public health has improved since the last Five-Year Plan period (2006-2011), with significant progress made in multiple health care sectors, according to a program plan for health care development published by the government yesterday. According to the plan, a national medical and health system will be formed by 2015, allowing all Chinese to have access to basic public health care services.

Disabled mother, son complete hard trek Posted: 19 Oct 2012 09:34 AM PDT A YOUNG man who completed a 100-day journey pushing his wheelchair-bound mother to the holiday destination of her dreams is being lauded online. Fan Meng, 26, traveled on foot with his mother Kou Minjun all the way from Beijing to Xishuangbanna in southwest China's Yunnan Province. On their arrival on Thursday, they were welcomed by ethnic dances and songs by local residents. The 3,500-km slog allowed Kou, who suffers from infantile paralysis and has not left Beijing for many years, to realize a long-held ambition of visiting the beautiful Xishuangbanna. Along the way, Fan kept a blog, which was avidly followed by netizens. Fan's mother divorced 10 years ago and has been living with her son, getting by with government subsidies and generous aid from relatives. Asked by The Beijing News earlier why he did not take a plane or a train, Fan said then they would have missed the view on the way. He said his mother had agreed if it became too difficult on the way, they would take a train. Also, he said he was surviving on 20 yuan (US$3.20) a day. He gave up his job several months ago for the trek. Kou said she knew Xishuangbanna through TV programs and newspapers, but, "without my son, I was afraid I would never have made it here." Life has not been easy for her son either. Fan's girlfriend abandoned him prior to his trip. He changed several jobs over the past six years and was not satisfied with his last job as a salesperson of an electronics firm. "In the face of so much pressure in my life, I had always wanted to find a way to relax myself and have some space and time to think on my own," said Fan. He originally planned to walk to the vast grasslands in north China's Inner Mongolia. Knowing her son's idea, Kou agreed to travel with him but pushed for Xishuangbanna instead. On July 8, he decided to walk with his mother and his dog "Butterfly" to Xishuangbanna. Early in the morning of July 11, mother, son and their canine companion left their home in Chaoyang District in Beijing and started their long journey. They passed through Hebei, Henan, Hubei, Hunan, Guizhou and Yunnan provinces. To sleep, they bunked down in their own tent or at cheap hotels.

Hospital attacker gets life in jail Posted: 19 Oct 2012 09:33 AM PDT A MAN who killed a doctor and injured three others at a hospital in Harbin, Heilongjiang Province, was sentenced to life in prison yesterday. Li Mengnan, 18, was found guilty of murdering Wang Hao, a 28-year-old intern, injuring the other three. He was also ordered to pay more than 680,000 yuan (US$108,743) as compensation to the families of victims. Li escaped death penalty as he was below 18 years of age when he committed the crime. A life sentence was the highest penalty he could receive, his lawyer, Wei Liangyue, said. Wei told reporters that Li would appeal. "From a legal perspective, the court's decision was fair. But in my heart, it is still unfair," Wang Dongqing, father of the intern, told The Associated Press. "My son was taken from me. Even if they had sentenced him to death, it would have been unfair." Li broke into the office of the rheumatism immunity department of the No. 1 Hospital affiliated to Harbin Medical University on March 23. The court said in the ruling that Li held a grudge about his medical treatment at the hospital and carried out the attack in revenge. Li had received medical treatment at the hospital for five years but did not recover completely. The hospital would not administer the drug infliximab for treating ankylosing spondylitis as it could harm or even kill a tuberculosis carrier. Zhao Yanping, Li's doctor and deputy chief of the department, said Li's tuberculosis needed to be treated first as the drug would have had side-effects on his lungs. Li, however, felt that doctors were refusing him treatment because he was poor. He bought a fruit knife from a nearby store and returned to the hospital. He first slashed the neck of Wang Hao and then attacked two other doctors and another intern. After the attack Li left the scene but returned to the hospital to receive treatment for injuries he sustained during the attack, only to be arrested by police. The court did not accept that Li surrendered himself after the attack when he returned with his grandfather to the hospital for treatment. Li told China Central Television after he was detained that he had become frustrated with the hospital. "My grandfather and I made several trips to the hospitals and spent a lot of money, but I felt the doctors were deliberately making things difficult," Li told CCTV. Despite public sympathy for Li, members of the medical community demanded severe punishment to show zero tolerance for violence against health workers. Many doctors rallied around the victims, saying they've been unfairly demonized by the public and media for widespread corruption that they blame on systemic factors. Days after the attack, Health Minister Chen Zhu, whose department has come under pressure from the medical community demanding more protection for health workers, called on prosecutors to severely punish Li. Despite the injection of more than US$240 billion in extra funds into the health care sector, the doctor-patient relationship has not seen much improvement. Hospitals often become sites for protests by family members of patients who have died while undergoing treatment. Angry relatives set up mourning halls inside hospital waiting areas, demanding the hospitals assume responsibility for the death.

Presale houses cause problems for buyers, developers Posted: 19 Oct 2012 09:00 AM PDT THE common housing practice of selling homes before construction is completed, known as presales, is causing problems for both buyers and developers. "The problem is that after buyers pay for their future home, they cannot monitor the quality," said Cao Jing, a resident of Jinan, capital of Shandong Province. Cao bought a house in 2009. But in 2010, when she moved in she found cracks in the walls and a water leak in the bathroom, as well as a problem with the electrical wiring. "Changing the wiring is not easy, as it is inside the walls," she said. "If we choose to buy a completed home, we can check for such problems and then decide to buy or not." Presales have also caused problems for developers, as early-bird buyers get upset if a developer later lowers prices for promotional purposes. Wan Chengliang, a vice general manager of a property firm in Jinan, said one of his company's apartment projects initially sold for 6,000 yuan (US$959) per square meter, but later the price dropped to 5,300 yuan. "Many early buyers came back to demand the price difference," he said. Experts estimate that presale transactions account for around 70 percent of new housing sales in China. However, some believe the practice is unfair, as money paid by home buyers for future homes gets turned into original capital for developers, who can then push housing prices higher by intentionally delaying sales. Xia Geng, vice governor of Shandong, said some presale houses have not been delivered to buyers on time, which has led to complaints. Xia stressed the presale system should be improved while sales of decorated houses be encouraged in the future. Guo Songhai, head of the real estate research institute at Shandong University of Finance and Economics, said: "Selling more complete houses will be healthy for the market."

Increasing stress levels generate concern Posted: 19 Oct 2012 09:00 AM PDT GROWING levels of stress among China's work force has raised public concern and sparked a heated discussion among the Internet community. Some 75 percent of workers feel more pressure this year than last, according to a September poll conducted by serviced office space provider Regus. The survey, which canvassed the opinions of more than 16,000 workers worldwide, put the global average at 48 percent. It concluded China held the highest rate of increasing stress levels of all countries polled. The leading causes of stress were identified as employment, finances and customers. While the result remains controversial in China due to Japan's greater reputation for stressed-out employees, Chinese workers are indeed experiencing more pressure from work than before, said Xiao Minzheng, director of Peking University's Center for Human Resource Development and Management Research. The poll said stress levels rose for 45 percent of workers in Japan and 58 percent in Germany, which came second in Regus's rankings of increased stress. "China has yet to improve its housing, health care and pension systems, and that's why Chinese workers feel more pressure," Xiao said. The Regus poll was widely circulated via Chinese media after its publication, and the result was echoed by another online survey launched by Sina Weibo, China's most popular microblog. The Sina poll, which had garnered responses from more than 6,800 Chinese Internet users by 4pm on Thursday, showed that more than 6,500 said they feel "pressure." The choices of the poll were limited to "yes" or "no." Many Internet users have commented on the topic. Some believe pressure is increasing in the workplace because of more competition, greater ambition to succeed, the lack of a social security network, and the lack of psychological counseling. "The biggest pressure is that I'm not sure what will happen in the future," wrote someone identified by the screen name "Song of Darkness." Few microbloggers said they don't feel any pressure, although some dismissed the aspirations driving many people's career anxieties. "Want less, care less, less pressure," wrote "Daodaoxinqing." Stress caused by jobs has become a source of great public concern, especially since the past few years that have seen several cases of young workers dying suddenly at work or committing suicide as a result of the pressure they were under.

8 bus crash victims now out of critical condition Posted: 19 Oct 2012 09:00 AM PDT EIGHT people who were severely injured in a bus crash on Thursday afternoon in Hunan Province are no longer in a critical condition, local authorities said yesterday. The bus, which was carrying mostly students, plunged down a 30-meter slope in Yongzhou City on Thursday. Four students died and 44 others were injured. A group that handled the rescue operation said it had organized medical experts to treat the eight that were severely wounded. The bus was taking 46 students and one teacher from Hunan Daoxian County Junior Normal College in Daoxian to Yongzhou when the accident happened. The students are aged between 17 and 21. Two students died at the scene and two others died in hospital. The driver, a man surnamed Zeng, 42, was one of the eight that had been in a critical condition. The school rented the bus from Yongzhou Wangda Transport Corp. Police are still investigating the accident.

Nestle to Battle Starbucks in Chinese Premium Coffee Market Posted: 19 Oct 2012 09:02 AM PDT Source: Bloomberg News By Dermot Doherty Nestle (NESN) SA rules the high-end coffee market in Europe with Nespresso capsules. Green Mountain Coffee Roasters Inc. (GMCR) dominates the U.S., leaving China as the biggest land grab for premium single-serve coffee. Nestle, due to present results from a Chinese location for the first time tomorrow, has prepared for rising demand in the country with Nespresso machines celebrating the year of the dragon decorated by Hong Kong-based luxury brand Shanghai Tang. Starbucks Corp. (SBUX) said in April it plans to introduce its Verismo single-serve system in the country in 2013. With Chinese consumers drinking only three cups of coffee per capita each year, compared with 604 for the French, the companies are wagering that there's latent demand in cities such as Shanghai, where rising wealth is whetting appetites for western luxuries. Mondelez International Inc., (MDLZ) the snacks and coffee business spun off from Kraft Foods Inc., is also considering introducing its Tassimo coffee maker in China. "There may be a bit of a fight in China as the coffee market there generally is embryonic," said Jon Cox, an analyst at Kepler Capital Markets. Sales of coffee pods in China climbed 50 percent last year, compared with 19 percent growth for standard ground coffee, according to researcher Euromonitor International. Still, they represent only about 0.1 percent of the country's coffee market, illustrating the scale of the opportunity for manufacturers. 'Inflection Point' "The number of middle-class consumers in China is expected to increase fivefold between now and 2030, so it could be that coffee companies think the inflection point for single-serve in China is now," said Warren Ackerman, an analyst at Societe Generale in London with a buy recommendation on Nestle shares. Nespresso entered the country in 2007 and has three boutiques there. Its expansion plans haven't been disclosed. "We are focused on nurturing the budding coffee culture in the country," said Mark Leenders, Nespresso's director for Southeast Asia, Greater China and Korea. "The consumer interest is clearly evident any time you walk down a street in Shanghai or any other city in China and see the proliferation of brands and coffee shops." Nestle, whose Nescafe instant brand is the source of two- out-of-three cups of coffee in the Asian country, may say tomorrow that organic revenue increased 6.3 percent in the nine months through September, according to the average of 12 analysts surveyed by Bloomberg. Excluding price increases, sales gained 3.2 percent, the estimates show. Second-Largest Market Nestle fell 0.4 percent to 61.75 Swiss francs at 9:48 a.m. in Zurich trading, trimming this year's gain to 14 percent. Nespresso, which had revenue of 3.5 billion Swiss francs ($3.8 billion) in 2011, or 4 percent of Nestle's sales, has been one of the company's fastest-growing areas. China is set to become Nestle's second-largest market, after the U.S., this year, according to Ackerman. He estimates sales from that market may reach 5 billion Swiss francs in 2012, rising to nearer 6 billion francs after including the still-to- be-completed purchase of Pfizer Inc.'s infant-nutrition unit. Soluble coffee has played a big part in the Chinese growth of Vevey, Switzerland-based Nestle, with an average annual growth rate of 20 percent for brands that are used at home. The soluble market accounts for the bulk of coffee retail sales in China, rising fivefold between 2004 and 2011 and set to almost double to $1.96 billion in the period through 2015, according to researcher Mintel. The expansion of Starbucks, the world's largest coffee-shop operator, which has been in the country since 1999, is now helping to introduce higher-end coffee to consumers. The Seattle-based company plans to triple the number of its outlets in China to more than 1,500 by 2015. More Competition? "Experience from other markets tells us that once people get used to having a fresh cup of coffee in places like Starbucks, it's very hard to go back," said Jonny Forsyth, an analyst at Mintel in London. While Green Mountain focuses on the North American market, Mondelez may soon add to the competition in China. "In cities like Shanghai and Beijing, a coffee shop culture is developing and there's a fertile ground for single- serve," said Hubert Weber, president of Mondelez's coffee unit. Chinese consumers may switch to portioned coffee directly from instant coffee and skip the phase of drinking filtered coffee, according to the executive. "I would compare it to mobile phones and landlines — when you've never had a landline, you go straight to a mobile phone," Weber said. Still, beverage companies seeking to capitalize on the growth of China's coffee market have to be prepared for a long haul, said Hope Lee, an analyst at Euromonitor in London. "China is definitely one of the major growth markets, but it's still mainly young urban consumers and the majority of Chinese still prefer to drink tea, so companies will need to be patient," she said.

WTO hands Obama victory in U.S.-China steel case Posted: 19 Oct 2012 09:08 AM PDT Source: Reuters By Tom Miles and Rachelle Younglai (Reuters) – The World Trade Organization barred China on Thursday from imposing duties on certain U.S. steel exports, siding with U.S. President Barack Obama in a dispute with Beijing over a type of steel made in two election battleground states. The case involved duties imposed by China on "grain-oriented electrical steel," which is used in the cores of high-efficiency transformers, electric motors and generators. The steel is made by AK Steel Corp of Ohio and ATI Allegheny Ludlum of Pennsylvania. Although the specialty steel case is tiny compared with other trade disputes with Beijing, the WTO ruling gave Obama a timely win as he defends himself against accusations by his Republican opponent, Mitt Romney, that he is soft on China. "Today we are again plainly stating that we will continue to take every step necessary to ensure that China plays by the rules and does not unfairly restrict exports of U.S. products," Obama administration trade representative Ron Kirk said in a statement. China's Ministry of Commerce had no immediate comment on the ruling, which arrived late in the evening in Beijing. When the Obama administration filed the case, the volume of specialty steel trade with China was in the range of $250 million. That pales in comparison with the auto and auto-parts trade at issue in the most recent case Washington filed against China in September. The volume of auto parts trade alone amounted to about $12 billion in 2011, according to the Alliance for American Manufacturing. Derek Scissors, a research fellow at the conservative Heritage Foundation, said Thursday's ruling was "a small benefit for the Obama campaign because it can advertise 'beating China' in Ohio, but it's not a benchmark for anything." Obama has won WTO victories against Beijing in areas ranging from intellectual property rights to financial services to raw materials trade and has launched several other challenges, such as a case against Chinese export restrictions on rare earth materials. He has also created an interagency trade enforcement unit to devote more resources to ensuring China and other countries abide by global trade rules. The Romney campaign repeated on Thursday that China was stealing U.S. jobs and that Obama was not standing up to Beijing. LONG ROAD AHEAD The United States brought the steel case in September 2010 after China accused U.S. exporters of "dumping" – or selling at unfairly low prices – on the Chinese market and levied punitive duties on the steel imports. The tariffs, which AK Steel said amounted to about 19.5 percent on its products, potentially affected hundreds of millions of dollars' worth of the grain-oriented electrical steel. China imposed the duties after state-owned steel firms Baosteel Group and Wuhan Iron and Steel Group complained about imports from the United States and Russia, which was not a WTO member at the time and was not involved in the case. The Chinese steel companies were unhappy about the "Buy America" provisions of the American Recovery and Reinvestment Act of 2009 and state government procurement laws. On Thursday, the WTO appeals judges upheld the original ruling published in June and disagreed with China's claims that the three-person panel of adjudicators who judged the case then had misinterpreted the WTO rules. "This is very good news for American producers of this product," said David Hartquist, a partner with the law firm Kelley Drye who represents ATI. However, Hartquist said there was still a "long road ahead" as the case had to go through the WTO's dispute settlement body and China had to comply with the ruling. Calls to AK Steel's lawyer were not immediately returned. The decision of the original panel, which was chaired by New Zealand WTO Ambassador John Adank, received one of the most ringing endorsements by the appellate body in recent years.

China practices stopping "illegal entry" near disputed seas Posted: 19 Oct 2012 09:16 AM PDT Source: Reuters (Reuters) – China's navy and civilian maritime patrol vessels practiced on Friday stopping "illegal entry" into Chinese waters in the East China Sea, state media said, an area where Beijing is embroiled in a territorial dispute with Japan. State news agency Xinhua said the drill was the largest in recent years, made up of 11 vessels, eight aircraft and more than 1,000 sailors. While the report made no mention of tensions with Japan over a group of uninhabited islands in the East China Sea, it left little doubt the maneuvers were aimed at sending a message to Tokyo. "The drill included simulations of illegal entry, obstruction, harassment and intentional interference by foreign vessels when Chinese ships of the fishery administration and marine surveillance agency patrolled," Xinhua said. The exercise, it said, "was aimed at improving coordination between the navy and administrative patrol vessels, as well as sharpening their response to emergencies in order to safeguard China's territorial sovereignty and maritime interests". Japanese Defense Minister Satoshi Morimoto, quoted by his ministry's Internet site, said he would not comment on the nature or purpose of the exercises. But he added in comments to reporters: "Regardless of their activities, we remain vigilant in the waters and airspace where our country is in charge." Chinese fishery patrol ships and Japan's coast guard have faced off in recent weeks in the seas around what China calls the Diaoyu Islands and Japan the Senkaku islands. Taiwan also claims them. Violent protests and calls for boycotts of Japanese products broke out across China in mid-September after Japan bought some of the islets from their private owner.

China Faces Tough Choice on Growth Posted: 19 Oct 2012 09:21 AM PDT Source: Wall Street Journal By Tom Orlik anad Bob Davis BEIJING—China's latest evidence of sputtering growth underlines a dilemma for its incoming leaders: They can shore up the economy by doubling down on an exhausted growth model, or take a risky political bet on reforms that could worsen the slowdown in the short term. The challenge—an unusual one for a Communist government—is to put more money in the pockets of its consumers by tackling the burgeoning inequality in income, which has contributed to pushing China's growth off kilter. The 7.4% year-on-year rise in China's gross domestic product in the third quarter, reported Thursday, was the weakest growth rate since the start of 2009 and the seventh straight quarter of decline. Nevertheless, those hoping for a "soft landing" in China, ever-more important for the health of the global economy, took heart from some signs of stabilization. Industrial output, exports and investment all crept up in September. Employment has also stayed strong. That raises the question for Beijing of whether to use its usual levers to pump up the economy, or to try to put China on a sustainable growth path by focusing more on spending by domestic households and less on investment and exports. The traditional methods of kick-starting growth—cutting interest rates and boosting investment—would risk exacerbating economic imbalances, increasing investment returns at the expense of salaries and spending money for households. Spreading the gains from China's growth means challenging some of the most powerful groups in the country's body politic: local officials who benefit when their governments flip land bought on the cheap from farmers, and state-owned enterprises whose low taxes translate into less money for welfare programs. The winners in such a gamble would be China's lower and middle-income households, which are increasingly looked to as the source of future growth. Revamping the state-owned sector so the firms operate in a more commercial fashion could cost as many as four million jobs as the companies slim down and shed political tasks and subsidies, said Minxin Pei, a China expert at Claremont McKenna College. "It wouldn't be privatization; it would be departyization," Mr. Pei said. Incomes have risen across China in the past decade, but political elites have benefited disproportionately from a system that massively enriches those closest to the center of power. The problem is that what is good for the elites is no longer good for China: Deepening inequality now stands in the way of a long-stated goal of shifting China's growth model so that it depends more heavily on domestic consumption. "To get really big [reform], you have to go for a redistribution of income," said International Monetary Fund chief economist Olivier Blanchard. According to a new national survey of China's household income, China's richest 10% control 56.9% of household income and 84.6% of household wealth—"a level of inequality seen only in some struggling African nations," said Gan Li, a professor at Texas A&M University who led the survey. The deepening inequality also makes it tougher to safeguard against the fate of other one-time economic stars that failed to advance to the ranks of wealthy nations. Brazil's boom economy stagnated in 1980s and 1990s, for instance, as the country cleaved further into haves and have-nots, a pattern that some fear could be repeated in China. "There's a race in China between economic disparity and the rise of the middle class," says Cheng Li, a Brookings Institution senior fellow. Bolstering low- and middle-income households is important economically because these people spend a higher share of their income than rich households. The savings rate for China's top 10% of urban households is 38%, compared with 27% for middle-income households and 8% for the bottom 10%. Gao Jing, a 39-year-old migrant to Beijing, says she feels stuck. Ms. Gao runs a tiny store and earns about 2,500 to 3,000 yuan a month ($400 to $475), just enough to support her two children, she says. "Poor people like us find it hard to earn money, no matter how hard we work." Returning to her home province of Henan isn't an option, she says, because economic prospects are poor and the schools are bad. Concern about inequality is becoming increasingly commonplace in China. According to a 2012 Pew Research Center poll of 3,177 Chinese, 48% say the gap between rich and poor is a very big problem, up from 41% in 2008. Addressing inequality would require measures including protecting farmers' land rights to give them a valuable asset to sell or develop; granting migrant workers urban residency; and cracking down on corruption that enriches China's elites. All would require taking on powerful vested interests. The current administration has long promised stronger land rights for China's farmers. Local political chiefs and real-estate firms, however, are both enriched by sales of land that local governments buy cheaply from farmers. Farmers receive compensation of $17,850 per acre, on average, for land seized by local authorities, just 2.4% of the $740,000 per acre market value, according to a 2011 survey of 1,791 farmers conducted by Landesa Rural Development Institute. China's 168 million migrant workers help build, clean and serve the cities, but few have the opportunity to make permanent homes there. That is because of the rigid urban-residency system that denies migrant workers and their families access to health care, education and welfare benefits in towns, whose governments see migrants as a source of cheap labor rather than members of the urban population. Reducing income inequality would also require action to tamp down on corruption. A state-dominated economy, where officials control access to valuable assets, provides ample opportunities for graft. Transparency International ranks China as the 75th most-corrupt country in the world, slightly above Colombia. A 2008 study by Wang Xiaolu of the China Reform Foundation found that China's richest 10% of urban households had average annual per capita disposable income of 139,000 yuan, three times higher than the official data suggest. The "gray income" that accounts for much of the difference often has its origins in the misuse of power and is closely connected with corruption, Mr. Wang wrote. Some analysts criticized Mr. Wang's survey, saying it used an unrepresentative sample. The Chinese Internet site Baidu has created an online forum devoted to the issue of income inequality. "The higher hope you have, the more disappointed you will get," read one recent posting. "The wealth gap is getting bigger, with the rich people buying fancy cars and houses while the poor people can't even afford the rent. That is the reality of China now." President Hu Jintao and Premier Wen Jiabao, set to step down at the 18th Party Congress in November, promised a more "harmonious" society. But policies that juiced returns to investment and kept wages low also kept the income gap wide. The share of consumption in China's GDP fell to 34% in 2011, from 44% in 2002. Consumption never fell to that low a level in the U.S, going back as far as the 19th century, or in the fast-growing Asian tigers during their growth years, according to McKinsey Global Institute. The share of household spending in GDP in the U.S. is about 70%. The burden of reform will fall on the men expected to succeed them, Vice President Xi Jinping and Vice Premier Li Keqiang. But don't expect China's new leaders to move quickly. Central bank chief Zhou Xiaochuan has privately told Western officials that it would take until the fall of 2013 to put together a reform package, said a former U.S. official. "To complete a smooth succession, Li and Xi probably have to keep their heads low," said Fred Hu, chairman of Primavera Capital, a Beijing private-equity firm. The beneficiaries of change, lower- and middle-income households, have little voice in the policy process. But the costs of failure in slower growth and political instability could be high. "Japan's growth slowed when the economy was already wealthy, and levels of inequality were very low. That provided a baseline of stability for their lost decade," said Scott Rozelle, an expert on China's economy at Stanford University. "If China's economy in the next 20 years follows the same trajectory as the last 10, they could face zero growth as one of the most unequal societies in the world."

Have You Heard… Posted: 19 Oct 2012 09:00 AM PDT Have You Heard…

VIDEO: Fresh tensions in island dispute Posted: 19 Oct 2012 07:55 AM PDT China's navy has started carrying out military exercises in the East China Sea, the latest move in a bitter territorial dispute with Japan.

China becomes third biggest tourist source for New Zealand Posted: 19 Oct 2012 03:18 AM PDT China overtook the United States as the third largest source of visitors to New Zealand in the year to the end of September, the New Zealand government statistics agency announced today. "Most of our visitors still come from Australia, with over a million Australians visiting in the last year," Statistics New Zealand population statistics manager Andrea Blackburn said in a statement. "But the number of visitors from China increased to 186,800, fast approaching the 198,400 arrivals from the United Kingdom, our second largest source of visitors." In the September month, 179,100 visitors arrived in New Zealand, more than the 174,200 arrivals in September 2010, but lower than the 219,900 visitors in September 2011, when numbers were boosted by the Rugby World Cup, said the statement. Government tourism agency Tourism New Zealand said the figures were no surprise and reflected the Rugby World Cup 2011's impact on last year numbers. Chief executive Kevin Bowler said the year ending September saw visitor arrivals up 1.8 percent on 2011, but total arrivals for the month of September were down 19 percent, indicating a significant boost brought about by the Rugby World Cup, which New Zealand hosted in September and October. "This time last year, New Zealand was definitely caught in Rugby World Cup fever with September a key month for pool play games. The result was a big increase in visitors from Western and European markets," Bowler said in a statement. However, with the Rugby World Cup removed from the equation, the situation remained positive, he said. Total visitor arrivals are up 3.1 percent on two years ago, with Australian arrivals are up 4.5 percent on two years ago. Visitor arrivals from China were now only exceeded by Australia and the United Kingdom. "In terms of the number of people (tourism) operators are seeing, it is increasingly visitors from Asia, not Europe," said Bowler. "However, although the number of arrivals are high, Chinese stay on average for significantly fewer days than visitors from the United States and Europe, which remain priority markets for Tourism New Zealand," he said. Chinese holiday stay days were almost 50 percent less than stay days for holiday arrivals from the United States.

Chinese life expectancy to hit 75.8 years by 2015 Posted: 19 Oct 2012 03:05 AM PDT THE average life expectancy for Chinese will reach 75.8 years by 2015, one year longer than the average of 74.8 years recorded in 2010, according to a health care development plan issued today. Public health has improved since the last Five-Year Plan period (2006-2011), with significant progress made in multiple health care sectors, according to the 12th five-year plan for health care development published by the government today. According to the plan, a national medical and health system will be formed by 2015, allowing all Chinese to have access to basic public health care services.

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