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Dubya gets a thumbs down from China

By China Economic Review

And not for the usual cross-strait reasons; Chinese officials unofficially seem to believe it would better if George W. Bush was not president

As the crucial US presidential election rolls ever nearer, the general unofficial attitude of Chinese officials seems to have shifted from neutrality as to who wins to a more and more outspoken view that Kerry should win. Raising the question at a banquet these days gets a clear and immediate response – the arrogance of Bush and his team is harmful to US relations with the rest of the world, and no good for any of us. It is not, surprisingly, a matter of support for Taiwan, arms sales, trade disputes, or anything else that is bilateral. Officials seem to be instead looking at the issue from a global perspective and deciding, from a Chinese standpoint, that Bush is bad for the world.

Raising money remains a key problem for companies in China. The Shenzhen second board was supposed to be an answer to an entrepreneur’s prayers, providing a way for smaller companies to raise funds and for venture capitalists to cash out. The board’s launch this summer was definitely an advance, but the decision to make the listing requirements basically the same as those for the A-share main board in Shanghai offset the main point, at least for now. The Chinese approach to this is, as always – first set up the new framework in a way which does not undercut the entrenched interests, then gradually let the new framework become real. In the meantime, private Chinese companies are forced to look either at an overseas listing or to private equity as a way to gather funds for expansion. But a new and interesting trend, with the WTO continuing to prise open the doors, is interest in foreign securities companies proactively seeking out private Chinese companies and pitching a listing plan to them.

The renminbi has not been revalued, as so many commentators predicted. But it has now been re-colored. The new one-renminbi note has finally been issued, the last in the series of new-look banknotes all featuring an ever-more iconic Mr Mao in place of a now-retired group of attractive workers, peasants and intellectuals. What should be made of the change in color? The one-renminbi note now being retired is red. The new one is green. Is there symbolism attached to this, possibly unconscious? Who can say?

Two interesting incidents recently shed some more light on the ever-changing relationship between rulers and ruled. First, there was the cat and mouse game played between the Chinese authorities and Chinese soccer fans who wanted to use the China- Japan soccer games as an opportunity to lambaste the Japanese for failing to come totally clean on their wartime crimes. The Chinese authorities were in a dilemma – they wanted peace and orderly soccer, but how to stop the masses making what is, for them also, a valid historical point? Then came a remarkable incident on board an airliner. A China Eastern plane took off from Shanghai heading for Fuzhou and landed seven hours late. The passengers on board remembered that recently China Eastern announced a new policy of compensation for late services. They stayed on board, and demanded cash compensation before they would deplane. Three hours went by, and China Eastern in the end was forced to hand out RMB 200 to each person on the plane. Power to the people. The simplistic State Department view of monolithic China with clearcut human rights issues? Pass??, baby.

Residents of China’s main urban centers have access to 50 to 60 TV channels on their cable networks. It’s just a coincidence, presumably, that Bruce Springsteen once sang about 57 channels and nothing on. But this is about to change over the next few years. By 2008, China’s cities will be wired with digital TV cable, providing the potential for hundreds more channels along with interactivity. There are trials going on in a couple of centers, including Qingdao, and the question is where will all the extra content come from, and how will all the existing channels deal with the inevitable dispersal of advertising revenue? Meanwhile, the free broadcast channel frequencies are to be freed up to handle all sorts of mobile data services. China has moved really fast on the most basic mobile data transmission method – the GPRS data transmission overlay on the GSM mobile phone network is really fast. China Eye recently downloaded 15 megs of data in just 20 minutes over a GPRS link at Beijing airport. At that rate, the slower penetration of Wi-Fi hotspots is just not really a big issue, especially as GPRS works in taxis, offices, and (most) elevators, while Wi-Fi, of course, just works at the hot spots. Even in San Francisco, let alone Chengdu.

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