Thursday, March 14, 2013

Where China could come unstuck?

CNN asked experts to explain biggest challenges facing ChinaExperts: Economic disparity, gender imbalance, water and food security are big issuesDelegates are meeting for National People's Congress in BeijingXi Jinping to formally become Chinese president at end of congress

Hong Kong (CNN) -- Four months after hushed deal-broking produced a new leadership lineup for China, Xi Jinping is to set to formally take charge of the country he'll rule for the next 10 years.

Xi, along with new premier Li Keqiang, has inherited a supercharged economy that's created vast riches for some, a growing middle class, and many poorer migrant workers who are becoming increasingly frustrated with their lot in life.

But the deepening wealth divide isn't the only challenge facing the country's population of 1.3 billion people.

In November, as China was convening its 18th National Communist Party Congress, CNN asked a number of China experts to define what they believe to be the country's most pressing challenges. We revisit their thoughts four months on, as delegates attend the 12th National People's Congress in Beijing.

Wen opens China's People's Congress with call to unite

1. Closing the wealth gap

In February, the Chinese government announced plan to raise spending on social welfare by two percentage points within the next five years.

Economist Li Gan says that's nowhere near enough to narrow the wealth gap and argues that the country needs to work on a "much larger scale."

"If the government creates a stronger social safety net for its citizens, Chinese workers will feel less pressure to save for health emergencies, unemployment and retirement, and more likely to buy goods and services -- and create a mature consumer-driven economy," he says.

Gan explains his views here.

 2. Too many men

Faced with a surging population, China attempted to put the brakes on procreation in the late 1970s by implementing a controversial policy limiting couples in some areas to just one child.

Since then, a cultural bias towards male children has led to a skewed child sex ratio where millions of men, or "bare branches" face an uncertain future due to the lack of potential female partners, writes evolutionary biologist Rob Brooks.

"It would be difficult to overstate the urgent need for China to emulate South Korea in eliminating sex-biased abortion and neglect," Brooks writes.

Studies show, he says, what can happen if it doesn't.

Elmore Leonard has written 45 books, and some have been turned into movies or TV shows.3. Securing China's food, water and air

The legacy of China's powerhouse of cheap, labor-intensive exports is a natural environment tainted by the pollutants of economic growth.

Author Geoff Hiscock says securing the food, water and air security of China's 1.35 billion people is one of the leadership's biggest challenges.

"Beijing and other parts of northeastern China are already water-stressed, the air quality in inland mega-cities such as Chongqing and Chengdu is abysmal, farming land is being poisoned by toxic runoff from mining and industrial activities, acid rain blights large parts of south China, contagious disease is an ever-present risk among its livestock, and unscrupulous makers sell tainted foodstuffs," Hiscock writes.

So what can China do about it? More from Hiscock.

 Follow us on Twitter @CNNOpinion

Join us on Facebook/CNNOpinion

CNN's Paul Armstrong and Kevin Voigt contributed to this story.

/* push in config for this share instance */cnn_shareconfig.push({"id" : "cnn_sharebar2","url" : "http://www.cnn.com/2013/03/05/world/asia/china-leadership-challenges/index.html","title" : "China: Three challenges for new leaders"});ADVERTISEMENT Check out CNN's latest news, commentary, photos, and videos on our China special section. March 12, 2013 -- Updated 0125 GMT (0925 HKT) China's estimated 13 million Roman Catholics were victimized for years with many of their priests being expelled. CNN's David McKenzie speaks to one defiant priest.March 8, 2013 -- Updated 1054 GMT (1854 HKT) The public outcry continued in China's cyberspace days after Haobo, a two-month-old boy, was killed by a man who stole his parents' car with the child inside. March 7, 2013 -- Updated 1331 GMT (2131 HKT) There are 250 million Chinese migrant workers -- equal to about 80% of the U.S. population. But rural workers migrating to cities have little access to social services.March 6, 2013 -- Updated 1005 GMT (1805 HKT) Chinese authorities are trying to squeeze migrants out of Beijing. CNN's David McKenzie reports. March 5, 2013 -- Updated 1645 GMT (0045 HKT) Experts detail some of the largest challenges faced by China's new leadership.March 4, 2013 -- Updated 0034 GMT (0834 HKT) Many of China's Catholics are awaiting the election of a new pope with high expectations, writes CNN Beijing bureau chief Jaime FlorCruz. March 10, 2013 -- Updated 0427 GMT (1227 HKT) New South China Mall is the world's largest shopping center in terms of leasable space. But the mall is virtually deserted. March 5, 2013 -- Updated 0513 GMT (1313 HKT) The challenge facing China is moving from an export and investment driven economy to a more sustainable consumption-driven economy, writes Li Gan. Share with us your photos and videos of life in China-- the everyday China. The best content could be featured online or on air.Today's five most popular storiesMoreADVERTISEMENT

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Report: Chinese military hacking

Mandiant say thousands of cyber attacks have come from one neighborhood near ShanghaiThe espionage group mainly targeted U.S. blue chip companies in 20 separate industriesMandiant VP Grady Summers says diplomatic pressure is needed on Beijng from Washington

(CNN) -- The Chinese government is sponsoring cyber-espionage to attack top U.S. companies, according to Grady Summers, vice president of security firm Mandiant.

Virginia-based Mandiant published a 60-page report detailing allegations over a six-year period against a group of hackers -- known as Comment Crew -- which Summers linked to a secret division of the Chinese military.

Summers told CNN: "China is attacking the U.S. on a scale like we've never seen before... We believe that the Communist Party of China is very aware of this."

Read more: Have the courage to deal with cyber war

Mandiant says the activity can be traced to four networks near Shanghai -- with some operations taking place in a location that is also the headquarters of Unit 61398, the secret military division.


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Hong Kong's mounting food waste

Around 3,500 tons of food waste is produced each day in Hong KongThe city's existing landfills are set to be full by 2018High-tech and business ideas could help recycle waste, experts say

Hong Kong (CNN) -- Nestled among the granite peaks of eastern Hong Kong a new, man-made mountain is emerging.

It's the Tseung Kwan O landfill, a growing hillside of garbage that stretches over 50 hectares and will be up to 100 meters high when the site is full.

Like Hong Kong's three other main landfills, it is filling up fast. The city of seven million people is set to run out of space for its trash by 2018, with the Tseung Kwan O site set to be topped up by 2015.

While plans to expand some sites are being proposed and a controversial mega-incinerator project remains a possibility, focus in the city is turning to how to reduce the amount of waste it produces.

Infographic: From farm to fork to landfill

This is an innovative solution for trying to use biorefinery to tackle food waste and produce value added products.
Carol Lin, City University of Hong KongOne of the largest sources of trash in the city is food waste. According to Friends of the Earth, up to 40% of food in the city goes uneaten, creating around 3,500 tons of unwanted food each day, most of which ends up as landfill.

The local government has created a task-force to address the issue of food waste and set a 10% reduction target by 2016. Globally, only around 3% of food waste is recycled.

A "Save Food" campaign run by local NGO Greeners Action and partnering with local Hong Kong restaurants has been running since 2009, but more practical ways to recycle unwanted food are also being explored.

One is using biotechnology to turn binned food into useful products. Carol Lin is an assistant professor at City University of Hong Kong who is developing a process that turns bread products into succinic acid, a compound that can be used to create bioplastics and eco-friendly detergents.

Read more: Entrepreneurs see opportunity in trash cans

Partnering with a local Starbucks and an environmental group -- and with government backing until August -- she hopes to secure funding for a scaled-up working pilot operation that can process up to a ton of food waste.

"We do have food waste collection companies in Hong Kong that are really interested to try and upscale this process. I think this is an innovative solution for trying to use biorefinery to tackle food waste in Hong Kong to produce value added products," she said.

For local designer C.L. Lam, turning food waste into desirable products is already a viable business.

From bags to brushes, his company Green & Associates make over 60 household items using up to 50% of food waste, like apple pulp, coffee grounds and milk, together with conventional materials.

Read more: Making the most from food waste

Unfortunately for Hong Kong's mountains of trash, Lam has based his factory across the border in mainland China, citing cheaper manufacturing and transport costs, re-using its food waste, rather than his home city's.

Ultimately both Lam and Lin are honest when it comes to addressing the real problem: reducing food waste in the first place.

"Hong Kong people like to eat different types of food, but at the same time they generate serious issues that haven't been solved properly," said Lin.

"Really, reducing the amount of food that we try to buy that would be another good solution to solve this food waste issue."


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Apple CEO Cook ordered to testify in e-books case

Apple Inc. CEO Tim Cook takes the stage during Apple Inc.'s iPhone media event in San Francisco, California September 12, 2012. REUTERS/Beck Diefenbach

Apple Inc. CEO Tim Cook takes the stage during Apple Inc.'s iPhone media event in San Francisco, California September 12, 2012.

Credit: Reuters/Beck Diefenbach

By Nate Raymond

NEW YORK | Wed Mar 13, 2013 3:53pm EDT

NEW YORK (Reuters) - Apple Inc Chief Executive Tim Cook must sit for a deposition in the U.S. government's lawsuit against the company over alleged price-fixing in the e-book market, a judge ruled on Wednesday.

U.S. District Judge Denise Cote in Manhattan granted the Justice Department's request to compel Cook to testify for four hours in the lawsuit, which accuses Apple of conspiring with five publishers to raise e-book prices.

The government had argued that Cook likely had relevant information about Apple's entry into the e-books market. It also said Cook likely had conversations related to e-books with former Apple CEO Steve Jobs, who died in 2011.

Apple had fought the request, saying Cook's testimony would be "cumulative and duplicative" since the government had already deposed 11 other executives at the iPad maker.

Cote, on a teleconference, cited the death of Jobs as a key reason in ordering the deposition.

"Because of that loss, I think the government is entitled to take testimony from high-level executives within Apple about topics relevant to the government case," as well as to counter Apple's defense arguments, she said.

A spokesman for Apple did not immediately respond to a request for comment.

Apple is the only remaining defendant in the lawsuit, which was filed in April 2012 in U.S. District Court in New York.

The five publishers - Pearson Plc's Penguin Group, News Corp's HarperCollins Publishers Inc, CBS Corp's Simon & Schuster Inc, Hachette Book Group Inc and MacMillan - have already settled. The last to settle was Macmillan in February.

A trial is set for June. The government is not requesting damages but is seeking a finding that Apple violated antitrust law. It is also seeking an order blocking Apple from engaging in similar conduct.

TELECONFERENCE ARGUMENTS

During the teleconference, Orin Snyder, a lawyer for Apple at the law firm Gibson Dunn & Crutcher, called the government's request to depose Cook a "fishing expedition."

Snyder said the testimony of other executives should be sufficient in the case. Depositions of 11 other Apple executives have already taken place or been scheduled, according to an earlier letter Apple sent the judge.

"This effort to depose Mr. Cook, Apple's CEO, reflects the fact the government cannot meet its burden of proof in this case," Snyder said.

Lawrence Buterman, a Justice Department lawyer, said on the call that Cook had submitted a written declaration in the case in which he said he played no "meaningful role" in the events at issue.

The Justice Department wants to know what Cook "means by his qualifier," Buterman said.

The government believes it is likely, because of Cook's "position and closeness" with Jobs, that they had private conversations about e-books, Buterman said.

"It means Mr. Cook is the only potential source of information," he said.

The case is United States v. Apple Inc et al, U.S. District Court, Southern District of New York, No. 12-02826.

(Reporting by Nate Raymond in New York; Editing by Martha Graybow, Nick Zieminski and John Wallace)


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Ex-BBC DJ arrested again over sex offense claims

Former BBC presenter Dave Lee Travis returns to his house in Mentmore, southern England November 15, 2012. REUTERS/Olivia Harris

Former BBC presenter Dave Lee Travis returns to his house in Mentmore, southern England November 15, 2012.

Credit: Reuters/Olivia Harris

LONDON | Wed Mar 13, 2013 1:12pm EDT

LONDON (Reuters) - Former BBC radio presenter Dave Lee Travis, praised by Myanmar's Aung San Suu Kyi for entertaining her with his weekly show during her years in captivity, has been re-arrested over further allegations of sex offences, London police said on Wednesday.

Travis, 67, was first arrested last November by detectives working on Operation Yewtree, an inquiry centered on claims against the late BBC TV host Jimmy Savile. Travis has denied any impropriety.

Savile was one of Britain's biggest stars in the 1970s and 1980s but since his 2011 death, police discovered he had carried out sex crimes on an unprecedented scale.

Police said "Yewtree 4" - their arrest identification for Travis - was quizzed over new allegations when he answered bail on Monday. He was later released on bail until April.

"On his return on March 11, the man in his 60s was further arrested on suspicion of sexual offences in connection with further allegations made to Operation Yewtree," a police spokesman said.

A number of high-profile figures, including Jim Davidson, a comedian who hosted prime-time shows on the BBC in the 1990s and Max Clifford, Britain's most high-profile celebrity publicist, have also been arrested by Operation Yewtree detectives.

Police have been examining three categories of alleged offences: those involving only Savile, which make up the majority of cases; those involving Savile and others; and those which had no direct link to Savile.

The arrest of Travis falls into the last category.

Well-known in Britain for his years as a DJ on BBC Radio 1, Travis, nicknamed the "Hairy Cornflake" for his bushy beard, admitted he was astonished to learn that Suu Kyi had been a big fan of his show on the BBC World Service during her 15 years under house arrest between 1989 and 2010.

She singled out his music request program "A Jolly Good Show" for making her "world much more complete".

(Reporting by Michael Holden; editing by Tim Castle)


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For China Mobile, 4G and next iPhone key to unlocking Apple demand

A man looks at the screen of his iPhone as he walks on a busy street in downtown Shanghai March 13, 2013. REUTERS/Carlos Barria

1 of 6. A man looks at the screen of his iPhone as he walks on a busy street in downtown Shanghai March 13, 2013.

Credit: Reuters/Carlos Barria

By Lee Chyen Yee

HONG KONG | Thu Mar 14, 2013 6:40am EDT

HONG KONG (Reuters) - China Mobile Ltd said it plans to spend 41.7 billion yuan ($6.7 billion) developing 4G technology this year, hoping to tap pent-up demand for Apple Inc smartphones as it gets an iPhone model that will finally run on its network.

The world's largest mobile carrier - with more than twice as many subscribers as there are people in the United States - already has more than 10 million of its customers owning an iPhone even though the gadget doesn't properly work with the Chinese firm's homegrown TD-SCDMA 3G technology, which is not compatible with global technologies.

That inferior technology, and the failure to offer customers an iPhone contract - which its main rivals do - has been a key reason for China Mobile's slowing profit growth.

The company, valued at $220 billion or half an Apple, said on Thursday net profit rose 2.7 percent last year to 129.3 billion yuan ($21 billion). That was slightly better than expectations of 127.4 billion yuan, according to a Reuters poll of 13 analysts, which would have been the slowest growth since profits fell in 1999.

While many of China Mobile's iPhone users have found clever ways around some of the carrier's limitations, the company wants to close the gap with its two smaller rivals - China Unicom and China Telecom - which already offer iPhone-compatible technology.

Industry experts expect Apple's next iPhone will support China Mobile's TD-LTE 4G technology, even though this will be less widely used than the FDD-LTE standard.

"Apple's iPhones will be like a killer app for China Mobile once its gets its 4G up and running," said Huang Leping, an analyst at Nomura International in Hong Kong. "That will definitely boost user numbers, though it will weigh on the bottom-line in the first year or so as China Mobile will most probably have to provide heavy handset subsidies for the iPhone."

China Mobile said on Thursday it will spend 27 billion yuan on handset subsidies this year, up 13 percent from in 2012.

China Telecom, which signed up to sell the iPhone last year, increased its spending on handset subsidies by 50 percent in the first half of last year, and has seen its profits fall in the last three quarters on higher marketing and subsidy costs.

NO-FRILLS

Most of China Mobile's 715 million subscribers are no-frills users attracted to its wide network coverage across the vast country. Only a small number are premium, tech-savvy consumers.

Just 13 percent of its users are on 3G, compared with one third at China Unicom and 44 percent at China Telecom, which use other variants of CDMA 3G technologies developed by global players such as Japan's NTT Docomo and Qualcomm Inc.

Using the iPhone on China Mobile's homegrown 3G network can be as sluggish as being hooked up to a 2G network, but many users take advantage of the carrier's many wi-fi hot-spots for heavier data-crunching applications such as playing games and downloading software.

Demand for the iPhone has spawned a cottage industry, with some local phone vendors selling SIM card cutters that act like a hole-punch to trim bigger cards to fit the smaller iPhone slots. Some China Mobile sales outlets offer on-the-spot SIM-trimming services as well as wi-fi cards that iPhone users can use in most hot-spots.

China Mobile is aggressively pushing for 4G to improve the user experience in a market where chatting on Tencent Holdings Ltd's WeChat and checking microblogs on Sina Corp's Weibo are the norm among smartphone users.

China Mobile plans to spend 190.2 billion yuan on its networks this year, out of which 41.7 billion yuan will be invested in 4G, executives said on Thursday. Last year, total spending was 127.4 billion yuan.

Chairman Xi Guohua said at the Mobile World Congress in Barcelona this year that the carrier planned to build a TD-LTE 4G network with 200,000 base stations to cover more than 100 Chinese cities, home to 500 million potential users.

China Mobile said on Thursday that it expects 4G licenses to be issued around the end of this year, echoing comments by a senior Chinese official last week that lifted mainland telecom-related stocks in Hong Kong.

(Editing by Ian Geoghegan and Ryan Woo)


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