As U.S. retreats, EU and China seek climate leadership at summit


FILE PHOTO: Hundreds of environmentalists arrange their bodies to form a message of hope and peace in front of the Eiffel Tower in Paris, France, December 6, 2015, as the World Climate Change Conference 2015 (COP21) continues at Le Bourget near the French capital. REUTERS/Benoit Tessier/File Photo

By Robin Emmott and Robert-Jan Bartunek | BRUSSELS Wed May 31, 2017 | 6:13pm EDT

China and the European Union will seek on Friday to save an international pact against climate change that U.S. President Donald Trump appears to be set to pull out of.

As China emerges as Europe’s unlikely global partner on areas from free trade to security, Premier Li Keqiang will meet top EU officials at a summit in Brussels that will also discuss North Korea’s missile tests.

In a statement backed by all 28 EU states, the European Union and China will commit to full implementation of the Paris Climate Agreement, EU and Chinese officials said.

The joint statement, the first between the China and the EU, commits to cutting back on fossil fuels, developing more green technology and helping raise $100 billion a year by 2020 to help poorer countries cut emissions.

“The EU and China consider climate action and the clean energy transition an imperative more important than ever,” the statement, by European Council President Donald Tusk, European Commission President Jean-Claude Juncker and China’s Li, will say.

“The increasing impacts of climate change require a decisive response.”

China asked that the annual the summit, normally held in mid-July, be brought forward to press home President Xi Jinping’s defense of open trade at the World Economic Forum in Davos in January, in response to Trump’s protectionist stance.

But Trump’s plan to follow through on a campaign pledge to withdraw from the Paris accord, agreed on by nearly 200 countries in 2015, is now dominating, diplomats said.

China, which overtook the United States as the world’s biggest emitter of greenhouse gases in 2007, is ready to support the European Union, despite tensions on other issues from human rights to trade, according to China’s ambassador to the EU, Yang Yanyi.

“China and the EU need to steadfastly adhere to the Paris agreement,” Yang said in a written briefing to reporters.

The warmer EU-China relationship, partly spurred by Trump, is despite a long-running spat with Beijing on what Europe sees as China’s dumping of low-cost goods on European markets.

“No one should be left behind, but the EU and China have decided to move forward,” Miguel Arias Canete, the European commissioner who has led climate talks with Beijing, said of the Paris accord.

FREE-TRADE FORERUNNER?

While China needs the EU’s technical know-how to fight the pollution blighting its cities, the European Union is looking to Beijing to take action against emissions blamed for increased droughts, rising seas and other affects of climate change.

Still the European Union remains cautious about the direction of its second-largest trading partner, concerned by China’s steel exports, its militarization of islands in the South China Sea and a turn toward authoritarianism under Xi.

EU officials say they will bring up the South China Sea in the talks on Friday, but they will be wary to avoid a repeat of last year’s tense EU-China summit in Beijing, which failed to agree a joint statement because of the maritime issue.

China’s claims in the South China Sea, through which about $5 trillion in ship-borne trade passes each year, are contested by Brunei, Malaysia, the Philippines, Taiwan and Vietnam.

The EU also wants an investment treaty with China to open the huge Chinese market to European companies and remove onerous rules forcing them to share know-how.

A senior Chinese official said China is determined to open up and reach a deal, which seen as a forerunner to a possible future free-trade accord.

(Additional reporting by Philip Blenkinsop; Editing by Robin Pomeroy)

Source: Reuters “As U.S. retreats, EU and China seek climate leadership at summit”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


‘Shocked’ South Korea leader orders probe into U.S. THAAD additions


FILE PHOTO: A Terminal High Altitude Area Defense (THAAD) interceptor is launched during a successful intercept test, in this undated handout photo provided by the U.S. Department of Defense, Missile Defense Agency. U.S. Department of Defense, Missile Defense Agency/Handout via Reuters/File Photo

By Heekyong Yang and Ju-min Park | SEOUL Tue May 30, 2017 | 5:51pm EDT

South Korean President Moon Jae-in has ordered a probe after his Defence Ministry failed to inform him that four more launchers for the controversial U.S. THAAD anti-missile system had been brought into the country, his spokesman said on Tuesday.

The Terminal High Altitude Area Defense (THAAD) system battery was initially deployed in March in the southeastern region of Seongju with just two of its maximum load of six launchers to counter a growing North Korean missile threat.

During his successful campaign for the May 9 presidential election, Moon called for a parliamentary review of the system, the deployment of which infuriated China, North Korea’s lone major ally.

“President Moon said it was very shocking” to hear the four additional launchers had been installed without being reported to the new government or to the public, presidential spokesman Yoon Young-chan told a media briefing.

Moon had campaigned on a more moderate approach to Pyongyang, calling for engagement even as the reclusive state pursues nuclear weapons and ballistic missile programs in defiance of U.N. Security Council resolutions and threats of more sanctions.

The Pentagon said it had been “very transparent” with South Korea’s government about THAAD deployment. “We continue to work very closely with the Republic of Korea government and we have been very transparent in all of our actions throughout this process,” Pentagon spokesman Jeff Davis told a news briefing.

Separately on Tuesday, the U.S. military cheered a successful, first-ever missile defense test involving a simulated attack by an intercontinental ballistic missile, a major milestone for a program meant to defend the United States against North Korea.

The Missile Defense Agency said it was the first live-fire test against a simulated ICBM for the Ground-based Midcourse Defense (GMD), a separate system from THAAD, and called it an “incredible accomplishment.” [L1N1IW1MM]

CHINA TENSIONS EASING

Moon’s order of a probe into the THAAD launchers came amid signs of easing tensions between South Korea and China, a major trading partner.

China has been incensed over the THAAD deployment, fearing it could enable the U.S. military to see into its own missile systems and open the door to wider deployment, possibly in Japan and elsewhere, military analysts say.

South Korean companies have faced product boycotts and bans on Chinese tourists visiting South Korea, although China has denied discrimination against them.

On Tuesday, South Korea’s Jeju Air said China had approved a plan for it to double its flights to the Chinese city of Weihai from June 2.

Also, a Korean-Chinese joint drama production “My Goddess, My Mom” starring South Korean actress Lee Da-hae was told by its Chinese partner recently that it will soon be aired, according to Lee’s agent JS Pictures. Previously its broadcast had been indefinitely delayed.

An official at South Korean tour agency Mode Tour told Reuters it hoped China may lift a ban on selling trips to South Korea, which had been in place since March 15, as early as the second week of June. Although there had been no official orders from the Chinese government to lift the ban, a few Chinese travel agencies have sent inquiries about package tours, he said. However, South Korea’s Lotte Group has yet to reopen any of the 74 retail stores in China it was forced to close in March after the group allowed the installation of the THAAD system on land it owned.

BOMBER DRILL

The United States, which has 28,500 troops stationed in South Korea, has a mutual defence treaty with Seoul dating back to the end of the 1950-53 Korean War, which ended in a truce that has left the peninsula in a technical state of war.

South Korea’s Defence Ministry said on Tuesday it had conducted a joint drill with a U.S. supersonic B-1B Lancer bomber on Monday, which North Korea’s state media earlier described as “a nuclear bomb-dropping drill”.

Japanese Prime Minister Shinzo Abe talked to Moon by phone on Tuesday and told him that dialogue for dialogue’s sake with North Korea would be meaningless, and that China’s role in exerting pressure on the North was important, Japan’s Foreign Ministry said in a statement.

North Korea’s KCNA news agency reported that leader Kim Jong Un supervised the country’s latest missile test on Monday. It said the missile had a new precision guidance system and a new mobile launch vehicle.

Kim said North Korea would develop more powerful weapons to defend against the United States.

“He expressed the conviction that it would make a greater leap forward in this spirit to send a bigger ‘gift package’ to the Yankees” in retaliation for American military provocation, KCNA quoted Kim as saying.

(Additional reporting by Jack Kim, Hyunjoo Jin, Christine Kim and Suyeong Lee in Seoul, Kiyoshi Takenaka in Tokyo and Phil Stewart and David Brunnstrom in Washington; Writing by Bill Tarrant; Editing by Nick Macfie and James Dalgleish)

Source: Reuters “’Shocked’ South Korea leader orders probe into U.S. THAAD additions”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


China to Build Seabed Observation Network in East, South China Seas


A graphic of China’s planned undersea monitoring system. Photo: handout

Mil.huanqiu.com says in its report “China spends more than 2 billion yuan to build an observation network covering East and South China Seas from seabed to surface” on May 28 that according to CCTV, Chinese government has recently given approval for the construction in five year of China’s seabed observation system in the East and South China Seas. The system is said to be capable of all-weather real-time HD multi-interface three-dimensional comprehensive observation from seabed to surface.

China plans to spend 2 billion yuan (US$290 million) for the construction.

SCMP says in its report “China plans undersea observation system ‘for science and national security’” on May 29, “A data centre will also be built in Shanghai to monitor and store the chemical, biological and geological information collected from the underwater systems. Such systems would not only help China advance in scientific research and disaster prevention, but help protect national security, the report (CCTV’s report on the system) said.”

According to mil.huanqiu.com’s report, China is but a late comer as developed countries such as the US, Western European countries and Japan have all set up such systems.

It is common sense that such systems first of all are used to detect and track submarines.

Comment by Chan Kai Yee on mil.huanqiu.com and SCMP’s reports. Summary translation is given here of mil.huanqiu.com’s report in Chinese at http://mil.huanqiu.com/china/2017-05/10759559.html while SCMP’s report can be found at http://www.scmp.com/news/china/diplomacy-defence/article/2096066/china-plans-undersea-observation-system-science-and.


China says Philippines’ 600-kg drug seizure was largest in shared crackdown


Philippine authorities last week seized more than 600 kg of methamphetamines in the largest such bust since China launched a crackdown on drug-smuggling in cooperation with the Southeast Asian nation, Chinese customs said on Monday.

China is the main source of methamphetamine consumed in the Philippines, which is caught in the throes of a brutal war on drugs waged by President Rodrigo Duterte.

Two people arrested in a May 12 raid on suspected smugglers told Chinese authorities they hid the drugs in five printing machines to smuggle them into the Philippines, customs officials in the coastal city of Xiamen said.

Tipped off by their Chinese counterparts, Philippine officials seized 604 kilograms (1,332 lb) of methamphetamine on May 26, Xiamen Customs said on its website.

“According to the Philippines side, this case is the largest drug trafficking bust made by the Philippines since China and the Philippines launched cooperation against cross-border drug smuggling,” the Xiamen officials said in the statement.

“It shows China’s determination to crack down on drug smuggling.”

The Philippines’ Bureau of Customs said in a statement issued last Saturday that it had acted on the intelligence from Chinese customs to seize the drugs in Valenzuela City, about 14 kilometres north of the country’s capital of Manila.

It valued the haul at 6.4 billion pesos.

“Our level of effective information-sharing with China Customs Cooperation sends a strong warning to all those involved in the drugs trade,” said Customs Commissioner Nicanor Faeldon.

The two nations agreed during Duterte’s visit to China last October to strengthen cooperation in battling illicit drugs.

Duterte defended Beijing last year after a Reuters report quoted Philippine drug enforcement officials as saying China had done little over the years to staunch the flow of meth and its precursor chemicals.

(Reporting by Brenda Goh; Additional Reporting by Karen Lema in MANILA; Editing by Clarence Fernandez and Peter Graff)

Source: Reuters “China says Philippines’ 600-kg drug seizure was largest in shared crackdown”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


China’s Telephone, Hanging Array for 6000m Deep Sea Communication


Recovery of water telephone-6971 used for deep sea communication alone or in cordination with the acustic hanging array

Recovery of water telephone-6971 used for deep sea communication alone or in cordination with the acustic hanging array

Lifting down the acoustic hanging array used for deep sea communication alone or in cordination with the water telephone

Recoverty of the acoustic hanging array used for deep sea communication alone or in cordination with the water telephone

In its report on what China’s Jiaolong deep sea submersible has achieved in its submerge operations at world deepest Mariana Trench in northern Pacific, huanqiu.com gives no photos of the submersible. As shown on top, four of the six photos posted by the website are water telephone-6971 and acoustic hanging array used for communication between the submersible and the mother ship more than 6,000 meters deep in the trench.

As there are no wire links between the telephone or array and the submersible or between them and the mother ship, there is speculation that the photos show China’s advanced deep sea communication equipment, which certainly can be used for military purposes.

Source: huanqiu.com “Jiaolong’s huge achievements in submerging into world deepest trench” (summary and comment by Chan Kai Yee on the report in Chinese)


China’s reforms not enough to arrest mounting debt: Moody’s


FILE PHOTO: A labourer has his dinner under his shed at a construction site of a residential complex in Hefei, Anhui province, August 1, 2012. REUTERS/Stringer/File Photo

By Yawen Chen and Ryan Woo | BEIJING Fri May 26, 2017 | 7:16am EDT

China’s structural reforms will slow the pace of its debt build-up but will not be enough to arrest it, and another credit rating cut for the country is possible down the road unless it gets its ballooning credit in check, officials at Moody’s said.

The comments came two days after Moody’s downgraded China’s sovereign ratings by one notch to A1, saying it expects the financial strength of the world’s second-largest economy to erode in coming years as growth slows and debt continues to mount.

In announcing the downgrade, Moody’s Investors Service also changed its outlook on China from “negative” to “stable”, suggesting no further ratings changes for some time.

China has strongly criticized the downgrade, asserting it was based on “inappropriate methodology”, exaggerating difficulties facing the economy and underestimating the government’s reform efforts.

In response, senior Moody’s official Marie Diron said on Friday that the ratings agency has been encouraged by the “vast reform agenda” undertaken by the Chinese authorities to contain risks from the rapid rise in debt.

However, while Moody’s believes the reforms may slow the pace at which debt is rising, they will not be enough to arrest the trend and levels will not drop dramatically, Diron said.

Diron said China’s economic recovery since late last year was mainly thanks to policy stimulus, and expects Beijing will continue to rely on pump-priming to meet its official economic growth targets, adding to the debt overhang.

WAITING FOR IMPLEMENTATION

Moody’s also is waiting to see how some of the announced measures, such as reining in local government finances, are actually implemented, Diron, associate managing director of Moody’s Sovereign Risk Group, told reporters in a webcast.

China may no longer get an A1 rating if there are signs that debt is growing at a pace that exceeds Moody’s expectations, Li Xiujun, vice president of credit strategy and standards at the ratings agency, said in the same webcast

“If in the future China’s structural reforms can prevent its leverage from rising more effectively without increasing risks in the banking and shadow banking sector, then it will have a positive impact on China’s rating,” Li said.

But Li added: “If there are signs that China’s debt will keep rising and the rate of growth is beyond our expectations, leading to serious capital misallocation, then it will continue to weigh on economic growth in the medium term and impact the sovereign rating negatively.”

“China may no longer suit the requirement of A1 rating.”

Li did not give a specific target for debt levels nor a timeframe for further assessments.

Moody’s expects China’s growth to slow to around 5 percent in coming years, from 6.7 percent last year, compounding the difficulty of reducing debt. But Diron said the economy will remain robust, and the likelihood of a hard landing is slim.

After Moody’s downgrade, its rating for China is on the same level as that on Fitch Ratings, with Standard & Poor’s still one notch above, with a negative outlook.

On Friday, Fitch said it is maintaining its A+ rating. Andrew Fennel, its direct of sovereign ratings, noted China’s “strong macroeconomic track record”, but said that its growth “has been accompanied by a build-up of imbalances and vulnerabilities that poses risks to its basic economic and financial stability”.

STIMULUS SPREE

Government-led stimulus has been a major driver of China’s economic growth over recent years, but has also been accompanied by runaway credit growth that has created a mountain of debt – now at nearly 300 percent of gross domestic product (GDP).

Some analysts are more worried about the speed at which the debt has accumulated than its absolute level, noting much of the debt and the banking system is controlled by the central government.

UBS estimates that government debt, including explicit and quasi-government debt, rose to 68 percent of GDP in 2016 from 62 percent in 2015, while corporate debt climbed to 164 percent of GDP in 2016 from 153 percent the previous year.

A growing number of economists believe that a massive bank bailout may be inevitable in China as bad loans mount. Last September, the Bank for International Settlements (BIS) warned that excessive credit growth in China signaled an increasing risk of a banking crisis within three years.

IS BEIJING MAKING PROGRESS?

The Moody’s downgrade was seen as largely symbolic because China has relatively little foreign debt and local markets are influenced more by domestic factors, with many companies enjoying stronger credit ratings from home-grown agencies than they would in the West.

Still, the rating demotion highlighted investor worries over whether China has the will and ability to contain rising risks stemming from years of credit-fueled stimulus, without triggering financial shocks or dampening economic growth.

China has vowed to lower debt levels by rolling out measures such as debt-to-equity swaps, reforming state-owned enterprises (SOEs) and reducing excess industrial capacity.

In recent months, regulators have issued a flurry of measures to clamp down on the shadow banking sector while the central bank has gingerly raised short-term interest rates.

But moves so far have been cautious, especially heading into a key political leadership reshuffle later this year.

The autumn’s Communist Party Congress is President Xi Jinping’s most important event of the year, where a new generation of up and coming leaders will be ushered into the Standing Committee, China’s elite ruling inner core.

But party congresses are always tricky affairs, as different power bases compete for influence, so the government will be keen to ensure there are no distractions like financial or economic problems or diplomatic confrontations.

(Additional reporting by Ben Blanchard and Elias Glenn; Editing by Kim Coghill and Richard Borsuk)

Source: Reuters “China’s reforms not enough to arrest mounting debt: Moody’s”

Note: This is Reuters’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


Assembly Shop of China’s Homegrown WS-15 Engine for J-20 Stealth Fighter


China’s homegrown powerful WS-15 engine for its most advanced stealth fighter J-20. Mil.huanqiu.com photo

WS-15 assembly factory. Mil.huanqiu.com photo

WS-15 assembly factory. Mil.huanqiu.com photo

Mil.huanqiu.com has a report today on the progress of the development and assembly of China’s homegrown engine for its most advanced stealth fighter J-20, which is said to lack engines powerful enough to achieve its designed advantages. No one in the world is willing to sell such powerful engine so that China has to develop its homegrown powerful engine for J-20.

According to the report, CCTV reporters have recently visited the assembly factory of AECC Shenyang Liming Group Co., Ltd. that develops and assemblies WS-15 Emei turbofan for J-20. There was report that WS-15 is more powerful than all its foreign counterparts, but its details remain China’s top secret.

However, CCTV has been able to take 15 photos of the top secret engine and its assembly factory, three of which are shown on top of this post.

The report only reveals that the internal workings of an aircraft engine (not specifically WS-15) are very complicated being made up of over 10,000 precision parts and that the quality of the assembly as the final step in producing an aircraft engine (not specifically WS-15) to a major extent affects the quality of the engine.

Source: mil.huanqiu.com “Official media reveals progress of homegrown engine for J-20” (summary by Chan Kai Yee based on the report in Chinese)