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Week of March 08, 2002

Week of March 8, 2002

The U.S. and China This Week

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DOMESTIC: China Raises Defense Budget Again

(3/5; 3/7) - China plans to raise defense spending by 17.6 percent this year, bringing its publicly acknowledged defense budget to $20 billion. This increase completes its one-third increase in acknowledged military spending over the past two years. China's real defense spending is estimated by Western experts to be as much as three to five times higher than what is being reported; it is considered the highest in Asia, topping Japan's $45 billion annual defense budget. Spending on foreign weapons acquisitions and on weapons research is not counted in Beijing's official defense spending tally.

China's finance minister, Xiang Huaicheng, reported to the National People's Congress that the funds were needed "to utilize modern technology, especially high technology…" and to boost salaries for soldiers. Beijing has explained its increase in defense spending as a response to the Bush administration's decision to withdraw from the Anti-Ballistic Missile Treaty and to pursue a missile defense system. China has expressed concern that if the U.S. builds a missile shield, the Chinese nuclear force will lose its strategic deterrent. A more powerful army also reflects Beijing's ambition to complement its strong economy and secure its strategic position in Asia.

This year's increase is part of a broader effort to modernize the People's Liberation Army (PLA). China's main modernization efforts have focused on turning the PLA into a modern streamlined fighting force. Toward that end, China has made substantial military acquisitions; China imported more arms than any other nation in 2000, according to the Stockholm International Peace Research Institute. Analysts contend China will likely be the largest importer of arms for 2001 and 2002 as well. Recent acquisitions have included two Sovremenny-class destroyers from the Russians, a sure sign of Beijing's intentions to challenge American influence in Asia.

But despite the huge increase in the defense budget, China's PLA is still struggling to become a modernized force. Chinese analysts cite poor morale as one reason why this is the case. The People's Liberation Army Daily, the army's newspaper, cites complaints about bad pay, lack of vacation time, and poor training. These factors, in combination with the blemish to the PLA's reputation after the Tiananmen Square incident in 1989, have served to hamper the PLA's ability to recruit the talent that it needs.

The army is also handicapped by its difficulty in absorbing new weapons. An Asian military officer estimated that 60 percent of Beijing's Su-27 fighter-ground attack aircraft cannot fly because they are either broken or because the pilots lack the skills necessary to fly them. He believes the PLA soldiers are 20 years behind his own in terms of skills. "This gap in personnel is not easily closed," he said.


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DOMESTIC: China's Zhu Vows to Tackle Poverty, Eradicate Graft

SUMMARY: (3/5; 3/6) - At this year's session of the National People's Congress, China's Premier Zhu Rongji pledged to fight rural poverty, support the urban unemployed, and eradicate official corruption. In his work report to the Congress March 5th, Zhu detailed the Communist Party's most pressing concerns as China braces for its first full year in the World Trade Organization.

Zhu declared that the key to growth in 2002 is to boost domestic demand by raising the incomes of rural and urban poor. Thus, he said, the most pressing task is to ensure pensions and allowances are paid on time and in full. Zhu's speech addressed the concerns of many delegates worried about how China's agriculture and industry would be able to compete after China's accession to the WTO. His speech also allayed concerns that the Party was forsaking the farmers and workers in favor of business elites.

Zhu also attacked wasteful bureaucrats who enjoyed themselves while farmers struggled under severe local government levies and workers had to make do without social security benefits. Official graft was listed as the number one public concern in a survey last week published in the People's Daily. Thus Zhu's tirade on corrupt and wasteful bureaucrats won him high praise.

While he lauded China's 7.3 percent growth rate in 2001, the premier stated that the country remains burdened by its legacy of central planning. "Industrial structure remains irrational, and deep-seated problems in our economic system have not been solved," Zhu stated. Zhu signaled there would be increased government spending to boost growth and help displaced workers.

In regards to Taiwan, Zhu called for Beijing and Taipei to establish direct trade, transport and postal links. Zhu repeated Beijing's precondition for official negotiation, that Taiwan accept the "one China" principle. While he did not repeat Beijing's threat to invade Taiwan if the island hesitated in the unification process, he did say that the Chinese government is "firmly convinced that the great aim of national reunification will be realized at an early date."


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U.S.-CHINA RELATIONS: Chinese Foreign Minister Sounds Positive on U.S.

(3/6) - China's foreign minister expressed a positive attitude about relations with the United States at his annual gathering with the press, a news conference held on the sidelines of the annual session of the National People's Congress. "We are ready to work together with the U.S. side to narrow differences, expand common ground, increase exchanges and promote cooperation in order to further push forward the
constructive and cooperative ties," Foreign Minister Tang Jiaxuan said.

Tang mostly stayed away from discussing areas of disagreement with the United States, and only mildly criticized the United States on Taiwan when the issue was raised by reporters. Although he did not specifically condemn American arms sales to the island, he did say China has always "firmly opposed" American efforts to boost Taiwan's self-defense capabilities. "I wish to emphasize that the Taiwan question remains the most sensitive and most important issue at the core of the Sino-US relationship," he said.

Asked if China and the United States were only experiencing short-term cordiality due to the war on terrorism, Tang replied that cooperation with the United States was "long-term." Tang said there were "twists and turns" after George W. Bush became president of the United States, but that the U.S.-China relationship had improved as a result of Bush's trips to China last October and last month.

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U.S.-CHINA RELATIONS: China Protests Taiwan Defense Minister's U.S. Visa

(3/7) - China has protested the United States government's decision to issue a visa to Taiwanese Defense Minister Tang Yiau-ming so he can attend a three-day closed-door defense conference in Florida beginning March 10. "We express our strong dissatisfaction and firm opposition to this," Chinese Foreign Ministry spokesman Kong Quan told a news conference. "It will bring about harm to both Sino-U.S. relations and cross-Strait relations." The visit will be the first by a Taiwanese defense minister to the United States for a purpose other than transit since at least 1979, when Beijing and Washington established diplomatic relations.

The St. Petersburg meeting is being called a "summit" by its private organizers; it is being sponsored by U.S. weapons suppliers. Deputy Defence Secretary Paul Wolfowitz and James Kelly, assistant secretary of state for East Asia and the Pacific, are scheduled to speak at the event.

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DOMESTIC: Report: China to Put Police on Planes

(3/5) - A new 2,000-member police force has been formed to guard China's airlines in response to the September 11th terrorist attacks on the United States; its officers will begin flying on domestic flights this summer. The China Daily reports that two officers will be assigned to each plane in July or August. The officers are being recruited based on their past military experience and "good morals," and will be trained in English and martial arts.

Chinese airlines have suffered at least two hijackings in the past three years, and had already adopted strict security measures prior to September. All bags are X-rayed, identification is required for all passengers, and security guards reportedly fly on domestic flights. The new police force is intended to strengthen even further China's security measures.

DOMESTIC: Falun Gong Hijacks City's TV Airwaves

(3/7) - Falun Gong members pulled off a shocking incident on the evening of March 5, seizing control of state television in the northeastern Chinese city of Changchun and broadcasting footage protesting the government's crackdown on the movement, locals said. The protest footage lasted about 50 minutes, a viewer said, and accused the Chinese government of staging the self-immolation of alleged Falun Gong members in Tiananmen Square last year in which a 12-year-old girl and her mother died. The viewer also said Falun Gong founder Li Hongzhi spoke on the program.

Local police have reportedly arrested one man in connection with the TV incident, the Changchun Evening newspaper said. Police officials and officials of the state-owned Changchun Cable Television Corporation, the city's largest cable broadcaster, would not comment. A city government official told Reuters that city hall had received word from the police that high-ranking officials and investigators from the Ministry of Public Security were going to investigate the incident.

Changchun has about 1.3 million residents and is the hometown of Falun Gong founder Li; residents say thousands there are still loyal to him, despite the Chinese government's crackdown on the movement. Falun Gong says about 1600 of its adherents have died from abuse in government custody; the government says only a handful have died, mostly from suicide or natural causes. It says Falun Gong has led to the deaths of at least 1900 individuals from suicide or refusing needed medical treatment.

Meanwhile, also on March 5th, the Chinese government arrested seven more foreign Falun Gong members for protesting in Tiananmen Square. Kati Vereshaka, an Australian Falun Gong spokeswoman, said three of the protesters were her cousin Mihai Molnar, his wife, Candice, and Greg March, all from Melbourne. Vereshaka said the protesters unfurled a banner saying "Falun Dafa is good," in Chinese. Falun Gong is also known as Falun Dafa. Vereshaka said she had made appeals to the Australian Foreign Ministry and the Australian embassy in Beijing to intervene in the case.


The U.S. and China This Week
The U.S. and China This Week

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