BEIJING, Sept 26 (Reuters) – Prominent Chinese commentator Hu Xijin said on Sunday that as China ponders its COVID-19 policies, epidemic experts need to speak out and China ought to conduct comprehensive research and make any studies transparent to the public.
Hu’s unusual call on Chinese social media for candour and transparency earned him 34,000 likes on the popular Twitter-like microblog Weibo, as well as frank responses from netizens in a normally tightly policed internet quick to censor voices deemed a risk to social stability.
China’s top leaders warned in May amid the COVID lockdown of Shanghai and widespread restrictions in the Chinese capital Beijing that they would fight any comment or action that distorted, doubted or repudiated the country’s COVID policies. read more
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“About the future, China needs very rational research and calculations,” said Hu, former editor-in-chief of nationalist state tabloid Global Times.
“Experts must speak out, and the country should organise comprehensive studies and make them transparent to the public: what are the pros and cons for our common people, and what are the overall pros and cons for the country?”
China has significantly tightened its COVID-19 policies this year to contain the spread of the highly transmissible Omicron variant even as its death toll since the pandemic began remains low – around 5,226 as of Saturday – and as many other countries let go of tough restrictions and learn to live with the coronavirus.
“Oppose excessive epidemic prevention,” one Weibo user wrote in response to Hu’s post.
In the name of putting the lives of people first, entire cities have been subjected to varying degrees of lockdown, while the infected or suspected cases are confined in facilities or at home, and local populations are required to take a PCR test every two to three days or be barred from public amenities and spaces. read more
“I don’t mind being infected, but I fear you can’t help but stop me from moving freely,” another Weibo user said.
Even Chinese-controlled Hong Kong is moving to scrap its controversial COVID-19 hotel quarantine policy for all arrivals, more than 2 1/2 years after it was first implemented, and just weeks ahead of a major Communist Party congress in Beijing next month when President Xi Jinping is expected to secure a precedent-breaking third term as China’s leader. read more
Macau is also planning to reopen its borders to mainland tour groups in November, the Chinese special administrative region surprised with an announcement on Saturday. read more
“The people must trust the state, but the state must also trust the understanding of the people,” Hu said.
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Reporting by Ryan Woo; Editing by Toby Chopra and Stephen Coates
Our Standards: The Thomson Reuters Trust Principles.
HONG KONG, Sept 24 (Reuters) – Credit Suisse’s (CSGN.S) top two executives have told staff the bank is working to establish a stronger franchise in the longer term, according to a memo seen by Reuters on Saturday, amid uncertainty over a global review of its operations.
The memo sent by Chairman Axel Lehmann and Chief Executive Ulrich Koerner said a “heightened level of media and market speculation” regarding the review had raised questions among the bank’s staff and clients.
Reuters reported on Thursday that Credit Suisse had sounded out investors about a possible capital raising as it attempts a radical overhaul of its investment bank.
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Koerner was appointed chief executive in late July and ordered a review of the bank’s operations, the second of its type in two years.
“When we launched our strategic review, we committed to an ambitious timeline whilst also making it clear that we would carry out a rigorous and diligent evaluation of all options for Credit Suisse,” the note said.
“We want to establish a clear path for the bank that will strengthen our franchise for the long term. This process requires time and a significant effort from many parts of the organization.”
A Credit Suisse spokesperson confirmed the contents of the memo.
Various scenarios are under discussion for the investment bank, including the most drastic option of largely exiting the U.S. market, two sources said. A bank spokesman said “Credit Suisse is not exiting the U.S. market.”
The review’s findings will be published on Oct. 27 when the bank releases its third-quarter earnings, said the memo, first published by Bloomberg News earlier on Saturday.
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Reporting by Scott Murdoch; Editing by David Holmes
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Scott Murdoch
Thomson Reuters
Scott Murdoch has been a journalist for more than two decades working for Thomson Reuters and News Corp in Australia. He has specialised in financial journalism for most of his career and covers equity and debt capital markets across Asia based in Hong Kong.
The meeting, at a political, economic and security forum that China and Russia dominate, comes at a delicate time for both leaders.
Russian President Vladimir Putin and Chinese President Xi Jinping plan to meet next week in Uzbekistan, a Russian official said Wednesday, announcing a summit that could signal another step in warming ties between two powers that are increasingly facing off against the West.
The meeting at the Shanghai Cooperation Organization — a political, economic and security forum that China and Russia dominate — comes at delicate times for both leaders.
Putin is dealing with the economic and political fallout of his war in Ukraine that has left Russia more isolated. Xi, meanwhile, is also facing a slowing economy as he seeks a third five-year term as Communist Party leader. While he’s expected to secure it, that would represent a break with precedent. Both have seen their countries’ relations with the West deteriorate.
Russian Ambassador to China Andrei Denisov told reporters that the two would meet at the organization’s summit in the Uzbek city of Samarkand on Sept. 15-16. “We are actively preparing for it,” Denisov was quoted by Russia’s state news agency Tass as saying.
The visit to Uzbekistan, if it goes ahead, would be part of Xi’s first foreign trip in 2½ years. Xi has only left mainland China once — to make a one-day visit to the semi-autonomous city of Hong Kong — since the start of the COVID-19 outbreak in late 2019.
When asked about the trip, Chinese Foreign Ministry spokesperson Mao Ning told a daily briefing Wednesday: “On your question, I have nothing to offer.”
Moscow and Beijing have increasingly aligned their foreign policies to oppose liberal democratic forces in Asia, Europe and beyond, making a stand for authoritarian rule with tight borders and little regard for free speech, minority rights or opposition politics.
The Russian military held sweeping military drills that ended Wednesday in the country’s east that involved forces from China, another show of increasingly close ties between the two.
Each leader may also be hoping to bolster his standing at home with the meeting. For Putin, it’s an opportunity to show that he still has powerful allies. For Xi, it could be a chance to be seen as standing up to Western opposition to the Ukraine war and burnish his nationalist credentials at a time when relations with the U.S. have grown increasingly tense over trade, technology, human rights issues and its threats to attack Taiwan.
Coming just ahead of China’s party congress, the overseas visits would also show Xi as confident of his position.
Putin and Xi last met in Beijing in February, weeks before the Kremlin sent troops into Ukraine. The two presidents oversaw the signing of an agreement pledging that relations between the sides would have “no limits.” It remains unclear whether Xi knew at the time of Russia’s plans to invade Ukraine.
While offering its tacit support for Russia’s campaign there, China has sought to appear neutral and avoid possible repercussions from supporting the Russian economy amid international sanctions.
Even though Moscow and Beijing in the past rejected the possibility of forging a military alliance, Putin has said that such a prospect can’t be ruled out. He also has noted that Russia has been sharing highly sensitive military technologies with China that helped significantly bolster its defense capability.
Typhoon Hinnamnor is forecasted to move gradually northward into the East China Sea with maximum sustained winds of nearly 110 miles per hour.
Cities in eastern China suspended ferry services and classes and flights were canceled in Japan on Sunday as Typhoon Hinnamnor, the strongest global storm this year, blew its way past Taiwan and the Koreas with fierce winds and heavy rains.
Shanghai grounded ferry services and deployed more than 50,000 police officers to aid with rescues and guide traffic away from danger areas. The eastern business hub of Wenzhou ordered all classes suspended on Monday.
Hinnamnor is forecasted to move gradually northward into the East China Sea with maximum sustained winds of nearly 110 miles per hour, according to the Hong Kong Observatory.
Evacuations and flight cancellations have been ordered in Japan’s southern Okinawa Island. The typhoon is also expected to bring intense rainfall to the Korean Peninsula, bringing the possibility of flooding.
China’s National Meteorological Center issued a yellow typhoon warning at 10 a.m. Sunday, and warned of heavy rains in northeastern Zhejiang, Shanghai and self-governing Taiwan.
Ships were told to return to port to take shelter from the wind, and the center also urged people against large gatherings both indoors and outdoors.
In Japan, the typhoon lashed Okinawa and nearby islands with heavy rain and fierce winds, threatening flooding and grounding more than 100 flights connecting the islands and parts of the main southern island of Kyushu.
Footage on Japan’s NHK national television showed trees violently shaken by the storm, with fierce rainfall hitting the pavement. A greenhouse for mangoes on Ishigaki Island was knocked down. On the main Okinawa island, two elderly people fell down and were slightly injured, according to media reports.
Officials said the slow-moving typhoon could add to rainfall and risks of flooding in the southern region where dense rain clouds have been stuck.
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In Taiwan, over 600 residents in New Taipei, Taoyuan and Hsinchu counties were evacuated to shelters on Saturday amid the heavy rain and strong winds, according to the island’s Central News Agency.The typhoon caused a landslide in Miaoli county and blew over some 100 roadside trees. About 40 flights and more than 100 ferry services across Taiwan were also canceled Saturday.
The announcement of trade talks comes after Beijing fired missiles into the sea to intimidate Taiwan after U.S. House Speaker Nancy Pelosi visited.
The U.S. government will hold trade talks with Taiwan in a sign of support for the island democracy that China claims as its own territory, prompting Beijing to warn Thursday it will take action if necessary to “safeguard its sovereignty.”
The announcement of trade talks comes after Beijing fired missiles into the sea to intimidate Taiwan after U.S. House Speaker Nancy Pelosi this month became the highest-ranking American official to visit the island in 25 years.
Chinese President Xi Jinping’s government criticized the planned talks as a violation of its stance that Taiwan has no right to foreign relations. It warned Washington not to encourage the island to try to make its de facto independence permanent, a step Beijing says would lead to war.
“China firmly opposes this,” Ministry of Commerce spokesperson Shu Jueting said. She called on Washington to “fully respect China’s core interests.”
Also Thursday, Taiwan’s military held a drill with missiles and cannons simulating a response to a Chinese missile attack.
Taiwan and China split in 1949 after a civil war and have no official relations but are bound by billions of dollars of trade and investment. The island never has been part of the People’s Republic of China, but the ruling Communist Party says it is obliged to unite with the mainland, by force if necessary.
President Joe Biden’s coordinator for the Indo-Pacific region, Kurt Campbell, said last week that trade talks would “deepen our ties with Taiwan” but stressed policy wasn’t changing. The United States has no diplomatic relations with Taiwan, its ninth-largest trading partner, but maintains extensive informal ties.
The U.S. Trade Representative’s announcement of the talks made no mention of tension with Beijing but said “formal negotiations” would develop trade and regulatory ties, a step that would entail closer official interaction.
Being allowed to export more to the United States might help Taiwan blunt China’s efforts to use its status as the island’s biggest trading partner as political leverage. The mainland blocked imports of Taiwanese citrus and other food in retaliation for Pelosi’s Aug. 2 visit.
Taiwan’s Foreign Ministry expressed “high welcome” for the trade talks, which it said will lead to a “new page” in relations with the United States.
“As the situation across the Taiwan Strait has recently escalated, the U.S. government will continue to take concrete actions to maintain security and stability across the Taiwan Strait,” it said in a statement.
U.S.-Chinese relations are at their lowest level in decades amid disputes over trade, security, technology, and Beijing’s treatment of Muslim minorities and Hong Kong.
The U.S. Trade Representative said negotiations would be conducted under the auspices of Washington’s unofficial embassy, the American Institute in Taiwan.
“China always opposes any form of official exchanges between any country and the Taiwan region of China,” said Shu, the Chinese spokesperson. “China will take all necessary measures to resolutely safeguard its sovereignty.”
Washington says it takes no position on the status of China and Taiwan but wants their dispute settled peacefully. The U.S. government is obligated by federal law to see that the island has the means to defend itself.
“We will continue to take calm and resolute steps to uphold peace and stability in the face of Beijing’s ongoing efforts to undermine it, and to support Taiwan,” Campbell said during a conference call last Friday.
China takes more than twice as much of Taiwan’s exports as the United States, its No. 2 foreign market. Taiwan’s government says its companies have invested almost $200 billion in the mainland. Beijing says a 2020 census found some 158,000 Taiwanese entrepreneurs, professionals and others live on the mainland.
China’s ban on imports of citrus, fish and hundreds of other Taiwanese food products hurt rural areas seen as supporters of President Tsai Ing-wen, but those goods account for less than 0.5% of Taiwan’s exports to the mainland.
Beijing did nothing that might affect the flow of processor chips from Taiwan that are needed by Chinese factories that assemble the world’s smartphones and consumer electronics. The island is the world’s biggest chip supplier.
A second group of U.S. lawmakers led by Sen. Ed Markey, a Democrat from Massachusetts, arrived on Taiwan on Sunday and met with Tsai. Beijing announced a second round of military drills after their arrival.
Taiwan, with 23.6 million people, has launched its own military drills in response.
On Thursday, drills at Hualien Air Base on the east coast simulated a response to a Chinese missile attack. Military personnel practiced with Taiwanese-made Sky Bow 3 anti-aircraft missiles and 35mm anti-aircraft cannon but didn’t fire them.
“We didn’t panic” when China launched military drills, said air force Maj. Chen Teh-huan.
“Our usual training is to be on call 24 hours a day to prepare for missile launches,” Chen said. “We were ready.”
The U.S.-Taiwanese talks also will cover agriculture, labor, the environment, digital technology, the status of state-owned enterprises and “non-market policies,” the U.S. Trade Representative said.
Washington and Beijing are locked in a 3-year-old tariff war over many of the same issues.
They include China’s support for government companies that dominate many of its industries and complaints that Beijing steals foreign technology and limits access to an array of fields in violation of its market-opening commitments.
Then-President Donald Trump raised tariffs on Chinese goods in 2019 in response to complaints that its technology development tactics violate its free-trade commitments and threaten U.S. industrial leadership. President Biden has left most of those tariff hikes in place.
A trader enters the floor of the New York Stock Exchange (NYSE) in New York City, U.S. June 14, 2022. REUTERS/Brendan McDermid
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HONG KONG, Aug 15 (Reuters) – The move to delist five Chinese state-owned enterprises (SOEs) from the New York Stock Exchange (NYSE) signals Beijing may be willing to compromise in order to strike an audit deal with the United States and end a more than decade-old dispute, analysts and advisers said on Monday.
The five SOEs including oil major Sinopec (600028.SS) and China Life Insurance (601628.SS), whose audits have been under scrutiny by the U.S. securities regulator, said on Friday they would voluntarily delist from the NYSE. read more
The U.S. Securities and Exchange Commission (SEC) had in May flagged the five and many other companies as failing to meet U.S. auditing standards, and the delisting signals China could compromise on allowing U.S. auditors to access the accounts of private Chinese companies listed in the United States, some analysts said.
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Beijing and Washington have been in talks to end a dispute that had threatened to kick out hundreds of Chinese firms from their New York listings if China did not comply with Washington’s demand for complete access to the books of U.S.-listed Chinese companies.
“Having the state-owned companies not listed in the U.S. allows the Chinese side to compromise in the negotiations,” said one Hong Kong capital markets lawyer, declining to be named due to sensitivity of the matter.
“They were more worried about having the SOEs’ accounts accessed,” said the lawyer, referring to authorities in Beijing. “A lot of the private companies are not thought to have data as sensitive as SOEs.”
Some observers, however, were less optimistic on the impact of the delistings.
“By taking the state-owned enterprises off the table, it would, in theory, give more room for the Chinese to make some concessions,” said Paul Gillis, a retired professor at Peking University’s Guanghua’s School of Management.
“But I think with the overall political environment between the U.S. and China being what it is, it’s hard to reach a deal.”
COMPLETE ACCESS
U.S. regulators have been asking for complete access to the audit working papers of New York-listed Chinese companies for years, but the Chinese authorities have pushed back on national security grounds.
In May, an SEC official said China could agree to the voluntary delisting of companies deemed “too sensitive” to comply with U.S. requirements, which would ensure the remainder of companies and audit firms could meet U.S. inspection and investigative processes, and avoid potential trading prohibitions.
Since then, however, the U.S. Public Company Accounting Oversight Board (PCAOB), which regulates audits of U.S.-listed firms and is overseen by the SEC, has said de-listing companies would not bring China into compliance because U.S. rules require the agency to have retrospective access to company audit records.
The PCAOB’s position on the matter has not changed, a PCAOB spokesperson said on Monday. A spokesperson for the SEC did not immediately respond to a request for comment.
The China Securities Regulatory Commission did not respond to a query on Monday afternoon.
More than 270 Chinese companies are identified as at risk of trading prohibition, with the PCAOB determining it did not have complete access to their audit papers.
Concerns about the future of those companies on the New York exchanges have swirled in recent months, with global fund managers holding U.S.-listed Chinese stocks steadily shifting towards their Hong Kong-traded peers. read more
Alibaba Group Holding announced a fortnight ago it would switch its Hong Kong secondary listing to a dual primary listing, which analysts said would make it easier in the future if the e-commerce giant ever wanted to delist in the United States.
“As for private enterprises listed in the U.S., whether they may be allowed more discretion to cooperate with the PCAOB will probably depend on the sensitivity of data in their audit papers,” said Weiheng Chen, head of Greater China Practice at law firm Wilson Sonsini.
Private enterprises owning large amounts of geographic data and data that track location, movements and social behaviors of individuals and companies, are more likely being viewed as sensitive, Chen said.
After the delisting of the five SOEs, only two state-owned firms will remain listed in the United States – China Eastern Airlines (600115.SS) and China Southern Airlines (600029.SS).
“China should be motivated to cooperate with the U.S. SEC to ensure Chinese companies with no sensitive information will not be cut off from the U.S. capital markets,” analysts at Jefferies wrote.
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Reporting by Scott Murdoch, Kane Wu, Xie Yu and Samuel Shen; Editing by Sumeet Chatterjee, David Holmes and Marguerita Choy
Our Standards: The Thomson Reuters Trust Principles.
Scott Murdoch
Thomson Reuters
Scott Murdoch has been a journalist for more than two decades working for Thomson Reuters and News Corp in Australia. He has specialised in financial journalism for most of his career and covers equity and debt capital markets across Asia based in Hong Kong.
President Xi Jinping of China, right, and President Vladimir V. Putin of Russia in Beijing in early February, weeks before Russia invaded Ukraine.Credit…Pool photo by Alexei Druzhinin
Amid heightened tensions surrounding Taiwan, President Volodymyr Zelensky of Ukraine on Wednesday stressed the importance of Chinese neutrality over the war in his country as Russia finds itself increasingly isolated by the West.
“I would like China to join the unified world position on the tyranny of Russia against Ukraine,” Mr. Zelensky said during a meeting with thousands of students organized by the Australian National University. “As for now, China is balancing and indeed has neutrality. I will be honest: This neutrality is better than if China would join Russia.”
Mr. Zelensky said in an interview with the South China Morning Post, a Hong Kong newspaper, that he would like to speak with China’s leader, Xi Jinping. “I had one conversation with Xi Jinping that was a year ago,” he said in the interview, published Thursday. “Since the beginning of the large-scale aggression on Feb. 24, we have asked officially for a conversation.”
Reflecting the delicacy of the moment, Ukrainian officials have been largely silent on the high-stakes visit this week of Speaker Nancy Pelosi to Taiwan. The Kremlin on Tuesday said her visit to Taiwan “provokes the situation” over the island.
The U.S. secretary of state, Antony J. Blinken, pressed China last month to join the United States, which is trying to assemble a global effort to punish Moscow for its aggression in Ukraine, and “stand up” against Russia’s war. In response, the Chinese foreign minister, Wang Yi, said that Beijing was neutral and criticized the United States for what he called “China phobia” and policies that offered “a dead end.”
From the outset of the war, Washington was able, with the threat of heavy sanctions, to dissuade China from providing weapons and economic assistance to Russia. China claims it is neutral because it has refrained from such explicit support.
In the South China Morning Post interview, Mr. Zelensky suggested that China could use its economic heft to counter Russia. “I’m confident, I’m sure that without the Chinese market for the Russian Federation, Russia would be feeling complete economic isolation,” he said.
Mr. Zelensky’s remarks at the Australian National University event came in response to a student’s question, and he offered a nuanced answer that recognized the geopolitical realities of the moment.
His government, he said, works tirelessly to persuade nations around the world to come together to isolate Russia. “Every day Russia loses more allies,” he said. But each nation, he said, makes its own calculations.
“I believe the people of China will make a prudent choice,” he said. “It’s important for us that China will not help Russia.”
He made the same appeal to the students that he has to leaders from around the world over the past five months — pointing to the atrocities committed by Russian forces and asking what would become of the world order if Moscow succeeded in imposing its will on a sovereign nation through brute force.
When asked by a student what has been the hardest part of leading a nation at war, Mr. Zelensky said it was understanding what people are capable of doing — both the heroism of those defending their homes, he said, and the horrors visited upon them by the invading army.
“I never thought that people are capable of those things,” he said.
China’s President Xi Jinping leaves the podium following his speech after a ceremony to inaugurate the city’s new leader and government in Hong Kong, China, July 1, 2022, on the 25th anniversary of the city’s handover from Britain to China. Selim Chtayti/Pool via REUTERS
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BEIJING, July 27 (Reuters) – China must focus on addressing “unbalanced and inadequate development” in the next five years, President Xi Jinping told senior leaders this week, indicating he wants to continue the economic priorities adopted in the past five years.
State broadcaster CCTV on Wednesday said Xi made the comments in a special two-day meeting in Beijing on Tuesday, in which he laid out his vision for “the next five years and more”, after the ruling Communist Party holds a Congress later this year.
The party is due to reshuffle its leadership for the next five years at the Congress. While his previous two predecessors stepped down after two full terms, Xi is expected to secure an unprecedented third term as China’s top leader at the Congress.
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Xi had first mentioned the need to address problems of “unbalanced and inadequate development” as a policy priority when he presented a major political document at the last Congress in 2017.
The problems include low quality growth, weak innovation, a wide gap in development and social services available between cities and villages and an over-reliance on fossil fuels, he said in the Congress report in 2017.
Xi told regional chiefs and ministers gathered for this week’s meeting that the party must keep up its “fighting spirit” and strengthen its “ability to fight”, according to CCTV.
In his review of the past five years, Xi listed the modernisation of Chinese military and peace in the Taiwan Strait as some of his achievements.
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Reporting by Yew Lun Tian
Editing by David Holmes and Mark Potter
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BEIJING — The saving opportunity with the rural bank in central China looked, to Sun Song, a 26-year-old-businessman, like a great find. It would be linked to his existing account at a large, reputable state-owned bank. The rural bank was also offering high interest rates, making it seem like an ideal place to park his roughly $600,000 in savings.
Then the bank abruptly froze his account this year, and officials said they were investigating potential fraud. “I owe money on my credit card and have to repay my car loan,” he said. “I have two sons. They’re all waiting.”
The financial scandal ensnaring Mr. Sun and thousands of others across the country could pose a serious test to the ruling Communist Party, which prizes stability and its ability to control any threats to it.While the amount of money at risk is small relative to China’s economy, it strikes at the core promise of the party that it will provide a better future for the people.
slowest rate of growth since the beginning of the coronavirus pandemic.
physically attacked by a mob of men while police officers stood by. Many protesters have since reported being harassed by the police.
“The government takes our taxpayer money and then beats us,” Mr. Sun said in a phone interview before the authorities warned depositors against speaking to the media. “My worldview has been destroyed.”
tested by the economic slowdown, born in part of the government’s draconian campaign against the coronavirus and a regulatory crackdown on the once-booming real estate industry. This banking scandal has exposed more systemic issues in China’s financial system, including potential corruption and weak regulatory oversight at rural banks.
Zhiwu Chen, a professor of finance at the University of Hong Kong. “The extent of this anxiety shared by people is increasing very fast. It’s not good for social stability.”
surveillance apparatus, it is facing growing unease about the lack of safeguards to prevent the theft or misuse of personal data. Beijing’s move to censor news about one of the largest known breaches of a Chinese government computer system showed keen awareness of how security lapses can harm its credibility.
Immediately, officials tried to silence them. Censors shut down protesters’ messaging groups. The local authorities manipulated depositors’ mobile health codes — digital indicators that China uses to track coronavirus infections — to bar them from entering public spaces. But after the manipulation attracted widespread condemnation, local officials retreated, and protesters continued to gather, including on July 10.
Many of the demonstrators presented their demands as appeals, rather than challenges, to the Communist Party’s authority. Some waved Chinese flags. Others invoked Mr. Xi’s slogan of the “Chinese Dream” or carried a portrait of Mao Zedong. They were met with ferocity all the same. Men in plainclothes began hitting and kicking the protesters.
promised last week to repay the depositors — but only those who had put in less than 50,000 yuan, about $7,500, with details for the rest to be announced later. They also said they would not repay anyone who had used “additional channels” to obtain higher interest payments or those suspected of dealing with “illegal funds.”
Those stipulations were seemingly a nod to the police’s announcement about the suspected criminal gang. According to the police, the gang’s scheme included setting up illegal online platforms to solicit new customers.
Huang Lei, a lawyer in the eastern city of Hangzhou who has worked on fraud cases, said people who had unknowingly participated in an illegal scheme should still be entitled to repayment. But he acknowledged that, in reality, they might have little recourse.
“The other party is eager to characterize it as illegal — they’ve described it four or five different ways — because they don’t want to take responsibility,” he said of the authorities. Even if the depositors sued for repayment and won, he added, the bank might not have adequate assets to make them whole, and it was unclear if the state would make up the difference.
Indeed, the scandal has raised broader questions about who is accountable for the lost money, besides the suspected criminals.
the deteriorating economy has put more pressure on those same institutions. As a result, Professor Chen said, “I expect to see more rural banks having to face the same kind of problems as the Henan rural banks.”
There are most likely hidden debts spread across China’s financial sphere. The country’s seemingly unstoppable growth over the past few decades had encouraged speculative borrowing and lending behavior by everyone from online lenders to major real estate companies.
The government has sought to downplay concerns about a broader problem. China’s central bank said last week that 99 percent of China’s banking assets were “within the safe boundary.”
Still, it will now be up to the government to decide how to address the losses both in Henan and those yet to be revealed, said Michael Pettis, a professor of finance at Peking University. Officials could allow institutions to default, hurting lenders; they could squeeze workers; they could print more money, leading to inflation. In the end, Professor Pettis said, “somebody’s got to absorb the loss.”
For the Henan depositors, the fear is that it will be them.
Wang Xiaoping, a 39-year-old software industry employee from Hangzhou, said she had put about $95,000 into one of the rural banks. But all she had to show for it was an injured chin, from being attacked by a man wearing black at the Zhengzhou protest. She tried to report the assault to the police, but they told her to go to another district, she said.
“I told the police, I’m willing to die here,” she said in an interview on July 10. “This is my entire net worth, this is all of my paychecks put together, and it’s gone just like that.”
“NO ES SUFICIENTE” — It’s not enough. That was the message protest leaders in Ecuador delivered to the country’s president this past week after he said he would lower the price of both regular gas and diesel by 10 cents in response to riotous demonstrations over soaring fuel and food prices.
The fury and fear over energy prices that have exploded in Ecuador are playing out the world over. In the United States, average gasoline prices, which have jumped to $5 per gallon, are burdening consumers and forcing an excruciating political calculus on President Biden ahead of the midterm congressional elections this fall.
But in many places, the leap in fuel costs has been much more dramatic, and the ensuing misery much more acute.
Britain, it costs $125 to fill the tank of an average family-size car. Hungary is prohibiting motorists from buying more than 50 liters of gas a day at most service stations. Last Tuesday, police in Ghana fired tear gas and rubber bullets at demonstrators protesting against the economic hardship caused by gas price increases, inflation and a new tax on electronic payments.
largest exporter of oil and gas to global markets, and the retaliatory sanctions that followed have caused gas and oil prices to gallop with an astounding ferocity. The unfolding calamity comes on top of two years of upheaval caused by the Covid-19 pandemic, off-and-on shutdowns and supply chain snarls.
World Bank revised its economic forecast last month, estimating that global growth will slow even more than expected, to 2.9 percent this year, roughly half of what it was in 2021. The bank’s president, David Malpass, warned that “for many countries, recession will be hard to avoid.”
ratcheting down gas deliveries to several European countries.
Across the continent, countries are preparing blueprints for emergency rationing that involve caps on sales, reduced speed limits and lowered thermostats.
As is usually the case with crises, the poorest and most vulnerable will feel the harshest effects. The International Energy Agency warned last month that higher energy prices have meant an additional 90 million people in Asia and Africa do not have access to electricity.
Expensive energy radiates pain, contributing to high food prices, lowering standards of living and exposing millions to hunger. Steeper transportation costs increase the price of every item that is trucked, shipped or flown — whether it’s a shoe, cellphone, soccer ball or prescription drug.
Understand Inflation and How It Impacts You
“The simultaneous rise in energy and food prices is a double punch in the gut for the poor in practically every country,” said Eswar Prasad, an economist at Cornell University, “and could have devastating consequences in some corners of the world if it persists for an extended period.”
Group of 7 this past week discussed a price cap on exported Russian oil, a move that is intended to ease the burden of painful inflation on consumers and reduce the export revenue that President Vladimir V. Putin is using to wage war.
Price increases are everywhere. In Laos, gas is now more than $7 per gallon, according to GlobalPetrolPrices.com; in New Zealand, it’s more than $8; in Denmark, it’s more than $9; and in Hong Kong, it’s more than $10 for every gallon.
Leaders of three French energy companies have called for an “immediate, collective and massive” effort to reduce the country’s energy consumption, saying that the combination of shortages and spiking prices could threaten “social cohesion” next winter.
increased coal production to avoid power outages during a blistering heat wave in the northern and central parts of the country and a subsequent rise in demand for air conditioning.
Germany, coal plants that were slated for retirement are being refired to divert gas into storage supplies for the winter.
There is little relief in sight. “We will still see high and volatile energy prices in the years to come,” said Fatih Birol, the executive director of the International Energy Agency.
At this point, the only scenario in which fuel prices go down, Mr. Birol said, is a worldwide recession.
Reporting was contributed by José María León Cabrera from Ecuador, Lynsey Chutel from South Africa, Ben Ezeamalu from Nigeria, Jason Gutierrez from the Philippines, Oscar Lopez from Mexico and Ruth Maclean from Senegal.