Quotulatiousness

August 6, 2013

Second Chinese aircraft carrier appears to be under construction

Filed under: China, Military — Tags: , — Nicholas @ 14:40

Strategy Page has the details:

Recent photos from a Chinese shipyard appear to show a section of a new Chinese aircraft carrier under construction. This appears to be a carrier similar to the American Nimitz class ships (100,000 ton vessels using a catapult rather than a ski jump flight deck for launching aircraft). Large ships, including warships, are often built in sections than the sections are welded and bolted together. The section of what appears to be a carrier does not indicate the exact size of the new carrier other than that it appears larger than the new carrier China commissioned at the end of 2012.

Last September China commissioned its first aircraft carrier, the Liaoning. At the time China was believed to be building the first of several locally designed aircraft carriers but the Chinese officially denied this. The only official announcements have alluded to the need for two or three aircraft carriers, in addition to the Liaoning. Construction of such large ships had not yet been seen in any shipyard. That has changed with the appearance of these new shipyard pictures.

[…]

The new Chinese “larger carrier” apparently means something like the recently decommissioned American USS Enterprise (CVN 65). This was the first nuclear powered carrier and it served as the prototype for the subsequent Nimitz class. It’s unclear if the new Chinese carrier will be nuclear powered. The Enterprise was an expensive design, and only one was built (instead of a class of six). While a bit longer than the later Nimitz class, it was lighter (92,000 tons displacement, versus 100,000 tons). The Enterprise was commissioned in 1961, almost 40 years after the first U.S. carrier (the Langley) entered service in 1923. In the two decades after the Langley there were tremendous changes in carrier aviation. While the innovation slowed after World War II, major changes continued into the 1950s (jet aircraft, nuclear propelled carriers, SAMs). But in the ensuing half century there has been no major innovation in basic carrier design. This has not been a problem because the carriers have proven useful, at least for the U.S. Navy (the only fleet to use such large carriers) and no one else has maintained a force of these large carriers. Only the U.S. has felt a constant need to get air power to any corner of the planet in a hurry. More importantly, no navy has been able to give battle to the U.S. carrier force since 1945. The Soviets built new anti-carrier weapons and made plans to use them but that war never occurred. China is building carriers but is not committed to having a lot of them to confront the U.S. but to intimidate its neighbors.

BBC News has a series of photos of the Liaoning from purchase to commissioning:


Click to see full-size images at the BBC website

Earlier reports on the progress of the Liaoning (under the name Shi Lang) can be found here.

Update: James R. Holmes on why China might be interested in becoming a 21st century naval power.

A couple of years back, when Beijing made its aircraft-carrier aspirations official, the fine folks at Foreign Policy asked me to explain why a historic land power like China cared about flattops. Being a bear of small brain, I reached into my mental bag of tricks and came up with Thucydides’ claim that fear, honor, and interest are three of the prime movers for human actions. Beijing feared U.S. containment, a relic of the Cold War; saw an opportunity to recoup honor lost during the century of humiliation at the hands of the imperial powers; and hoped to add to the naval power it was amassing to advance China’s interests in maritime Asia.

What’s changed since then? Fear and honor are emotional needs. It may be that sending the carrier Liaoning (formerly the Soviet Varyag) to sea helped satisfy China’s need to banish bad cultural memories. But who knows when fear will be at bay? The United States and its allies have ruled the sea in East Asia long enough that their navies may inspire fears disproportionate to their actual margin of supremacy. Or, the Chinese leadership may see value in protesting too loudly, and thus making Western powers fearful of creating a self-fulfilling prophecy, namely Sino-American antagonism.

Most importantly, it may be that having ameliorated anxieties arising from honor and fear grants Beijing the luxury of operating mostly from calculations of interest. Simply deploying a carrier, Liaoning, may forestall fears while satisfying Chinese society’s desire for a capability that every other great power enjoys.

July 27, 2013

Jiangsu might as well be the Chinese name for Detroit

Filed under: China, Economics — Tags: , , , , — Nicholas @ 11:02

The South China Morning Post on the economic troubles of the provincial, municipal and local authorities in Jiangsu:

The nightmare scenario for China’s leaders as they try to wean the country off a diet of easy credit and breakneck expansion is a local government buckling under the weight of its own debt. Few provinces fit that bill quite like Jiangsu, home to China’s most indebted local government.

Hefty borrowings through banks, investment trusts and the bond market by Jiangsu’s provincial, city and county governments have saddled the province north of Shanghai with debt far higher than its peers, public records show.

Many of the province’s mainstay industries, including shipbuilding and the manufacturer of solar panels, are drowning in overcapacity. Profits are dwindling, and the government’s tax growth is braking hard.

[…]

Little public information is available on the total debt of Chinese local governments. Indeed, earlier this month China’s Vice-Finance Minister Zhu Guangyao said Beijing did not know the precise level of their debts either.

But from what ratings agencies and think-tanks can piece together, Jiangsu may be the standout debt risk among China’s 31 provinces.

Looking at bank loan books, they can see that China’s eastern provinces including Jiangsu have the highest concentration of government debt. Jiangsu then looms large because of its reliance on costlier and alternative forms of financing, which they said suggested that cheaper bank loans and land sales are not giving the authorities the funding they need.

The risk that Jiangsu might pose to the Chinese economy in a crisis is clear. On its own, the province would be a top 20 global economy with GDP greater than G20 member Turkey. Its 79 million population tops that of most European countries.

July 18, 2013

Chinese museum woes – “80 of the museum’s 40,000 objects had been confirmed as authentic”

Filed under: China, History — Tags: , , , , — Nicholas @ 09:22

Tom Phillips on the sudden closure of the Jibaozhai Museum:

The museum’s public humiliation began earlier this month when Ma Boyong, a Chinese writer, noticed a series of inexplicable discrepancies during a visit and posted his findings online.

Among the most striking errors were artifacts engraved with writing purportedly showing that they dated back more than 4,000 years to the times of China’s Yellow Emperor. However, according to a report in the Shanghai Daily the writing appeared in simplified Chinese characters, which only came into widespread use in the 20th century.

The collection also contained a “Tang Dynasty” five-colour porcelain vase despite the fact that this technique was only invented hundreds of years later, during the Ming Dynasty.

Museum staff tried to play down the scandal.

Wei Yingjun, the museum’s chief consultant, conceded the museum did not have the proper provincial authorizations to operate but said he was “quite positive” that at least 80 of the museum’s 40,000 objects had been confirmed as authentic.

“I’m positive that we do have authentic items in the museum. There might be fake items too but we would need [to carry out] identification and verification [to confirm that],” he told The Daily Telegraph.

Mr Wei said that objects of “dubious” origin had been “marked very clearly” so as not to mislead visitors and vowed to sue Mr Ma, the whistle-blowing writer, for blackening the museum’s name.

July 1, 2013

The rise and fall of economic powers

Filed under: China, Economics, History, Japan — Tags: , , , , , — Nicholas @ 10:30

Charles Hugh Smith has a guest post at Zero Hedge, talking about the theme of economic decline of great powers:

Our collective interest in the rise and fall of empires is not academic. The meteoric rise of China and the financialization rotting out global capitalism are just two developments that suggest we are entering an era where some great powers will collapse, others will remake themselves and others will gain ascendancy.

[. . .]

In 1987, pundits were predicting that Japan’s “5th generation” computing would soon dominate what was left of America’s technological edge. They were spectacularly wrong, as the 5th generation fizzled and Japan became an also-ran in web technology, a position it still holds despite its many global electronic corporations and vast university research system.

Japan’s modern economy was set up in the late 1940s and early 1950s to exploit the world of that time. Sixty years later, Japan is still a wealthy nation, but its relative wealth and power have declined for 20 years, as its political-financial power structure clings to a model that worked splendidly for 40 years but has not worked effectively for 20 years.

The decline is not just the result of debt and political sclerosis; Japan’s vaunted electronics industry has been superseded by rivals in the U.S. and Korea. It is astonishing that there are virtually no Japanese brand smart phones with global sales, and only marginal Japanese-brand sales in the PC/notebook/tablet markets.

The key dynamic here is once the low-hanging fruit have all been plucked, it becomes much more difficult to achieve high growth rates. That cycle is speeding up, it seems; western nations took 100 years to rapidly industrialize and then slip into failed models of stagnation; Japan took only 40 years to cycle through to stagnation, and now China has picked the low-hanging fruit and reverted to financialization, diminishing returns and rapidly rising debt after a mere 30 years of rapid growth.

There is certainly evidence that China’s leadership knows deep reform is necessary but the incentives to take that risk are low. Perhaps that is a key dynamic in this cycle of rapid growth leading to stagnation: the leadership, like everyone else, cannot quite believe the model no longer works. There are huge risks to reform, while staying the course seems to offer the hope of a renewal of past growth rates. But alas, the low hanging fruit have all been picked long ago, and as a result the leadership pursues the apparently lower-risk strategy that I call “doing more of what has failed spectacularly.”

Though none of the historians listed above mention it, there is another dangerous dynamic in any systemic reform: the very attempt to reform an unstable, diminishing-return system often precipitates its collapse. The leadership recognizes the need for systemic reform, but changing anything causes the house of cards to collapse in a heap. This seems to describe the endgame in the USSR, where Gorbachev’s relatively modest reforms unraveled the entire empire.

June 30, 2013

“It’s very difficult to regulate greed”

Filed under: Business, Cancon, China, Law, Wine — Tags: , , , — Nicholas @ 11:30

Icewine is what originally put Canadian wine on the international map. Icewine is an expensive thing to produce, and therefore has drawn a lot of cheaters into the market:

Canada is tightening the rules for producing its popular icewine, a sweet dessert wine that is only made in cold climates, to crack down on fraudsters who sell mislabeled bottles that don’t make the grade.

In regulations published this week, the Canadian government said any bottle labeled and sold as icewine must be made only from grapes that have frozen on the vine.

[. . .]

Because the frozen grapes only yield a tiny amounts of sweet liquid, the dessert wine has a high cost and a high price. Grapes are left on the vine until the temperature falls to -8C (18F) over a prolonged period, and usually harvested overnight.

“It’s liquid gold,” said Paszkowski.

In China, where icewine has become hugely popular, a thriving counterfeit industry is flooding the market with wines that don’t live up to the label, he said.

“It’s very difficult to regulate greed,” said Paszkowski. “We’ve identified counterfeit icewines even in five-star restaurants and hotels.”

H/T to Elizabeth for the link.

June 23, 2013

Two remarkable press releases on the Snowden case

Filed under: China, Government, Law, Russia, USA — Tags: , , , , , — Nicholas @ 10:46

First, here’s the official Hong Kong government’s statement:

Mr Edward Snowden left Hong Kong today (June 23) on his own accord for a third country through a lawful and normal channel.

The US Government earlier on made a request to the HKSAR Government for the issue of a provisional warrant of arrest against Mr Snowden. Since the documents provided by the US Government did not fully comply with the legal requirements under Hong Kong law, the HKSAR Government has requested the US Government to provide additional information so that the Department of Justice could consider whether the US Government’s request can meet the relevant legal conditions. As the HKSAR Government has yet to have sufficient information to process the request for provisional warrant of arrest, there is no legal basis to restrict Mr Snowden from leaving Hong Kong.

The HKSAR Government has already informed the US Government of Mr Snowden’s departure.

Meanwhile, the HKSAR Government has formally written to the US Government requesting clarification on earlier reports about the hacking of computer systems in Hong Kong by US government agencies. The HKSAR Government will continue to follow up on the matter so as to protect the legal rights of the people of Hong Kong.

And here’s a statement from Wikileaks:

Mr Edward Snowden, the American whistleblower who exposed evidence of a global surveillance regime conducted by US and UK intelligence agencies, has left Hong Kong legally. He is bound for a democratic nation via a safe route for the purposes of asylum, and is being escorted by diplomats and legal advisors from WikiLeaks.

Mr Snowden requested that WikiLeaks use its legal expertise and experience to secure his safety. Once Mr Snowden arrives at his final destination his request will be formally processed.

Former Spanish Judge Mr Baltasar Garzon, legal director of Wikileaks and lawyer for Julian Assange has made the following statement:

“The WikiLeaks legal team and I are interested in preserving Mr Snowden’s rights and protecting him as a person. What is being done to Mr Snowden and to Mr Julian Assange — for making or facilitating disclosures in the public interest — is an assault against the people”.

To the vast amusement of many commentators, the reported route out of Hong Kong leads to Russia, with other stopping points including Cuba and Venezuela. It’s like a free press/civil liberties tour of the planet!

June 22, 2013

US charges against Snowden were filed on June 14th

Filed under: China, Government, Law, USA — Tags: , , , , — Nicholas @ 09:10

It apparently takes a week for the US government to publicize that it has laid charges

Federal prosecutors filed espionage charges against alleged National Security Agency leaker Edward Snowden, officials familiar with the process said. Authorities have also begun the process of getting Snowden back to the United States to stand trial.

The charges were filed June 14 under seal in federal court in Alexandria, Va. — and only disclosed Friday.

Snowden has been charged with three violations: theft of government property and two offenses under the espionage statutes, specifically giving national defense information to someone without a security clearance and revealing classified information about “communications intelligence.”

Each of the charges carries a maximum of 10 years in prison.

Snowden, who is a former employee of defense contractor Booz Allen Hamilton, leaked details about far-reaching Internet and phone surveillance programs to The Guardian and The Washington Post earlier this month. He revealed his identity while in Hong Kong, where it is believed he is still hiding.

It’s not clear whether the extradition will be straightforward:

Andy Tsang, Hong Kong’s police commissioner, said that if an extradition request was sent from a country that had a “mutual legal assistance agreement” with Hong Kong, its government would “handle it in accordance with current Hong Kong laws and systems.”

Simon Young, a professor at Hong Kong University’s faculty of law, suggested it was unclear whether Snowden would win or lose any attempt to fight extradition.

He said theft was listed in the U.S.-Hong Kong extradition treaty. “There is an offence listed in the treaty of unlawful handling of property, but this raises the question as to whether information is property and the answer is not clear,” he said in an email.

June 20, 2013

The world map of modern slavery

Filed under: China, Law, Liberty, Russia — Tags: , , , , , — Nicholas @ 14:05

In The Atlantic, Olga Khazan talks about the countries that appear on this US State Department map of human trafficking:

World Map of Slavery, 2013

China, Russia, and Uzbekistan have been named among the worst offenders when it comes to human trafficking, according to a State Department report released Wednesday, joining Iran, North Korea, Cuba, Sudan, and Zimbabwe on the bottom “tier” of the U.S. human trafficking rank.

Their lower designation means the U.S. may sanction those countries with measures like cancelling non-humanitarian and military assistance, ending exchange visits for government officials, and voting against any IMF or World Bank loans.

China, Russia, and Uzbekistan had previously been on the “Tier 2 Watch List,” a middling designation for countries that show little progress in making strides in preventing forced labor. Because they had been on the “Watch List” for four years, the State Department was obligated to either promote or downgrade them.

In China, the one-child policy and a cultural preference for male children perpetuates the trafficking of brides and prostitutes.

“During the year, Chinese sex trafficking victims were reported on all of the inhabited continents,” the report found. “Traffickers recruited girls and young women, often from rural areas of China, using a combination of fraudulent job offers, imposition of large travel fees, and threats of physical or financial harm, to obtain and maintain their service in prostitution.”

However, the State Department also singled out the country’s epidemic of forced labor, in which both internal and external migrants are conscripted to work in coal mines or factories without pay, as well as its continued use of re-education hard labor camps for political dissidents.

However, it’s also worth keeping in mind that there are two common definitions of human trafficking in use, one of which is an outrage to common decency while the other is an attempt to conflate sex work with slavery:

1) The transport of unwilling people (usually women, but of course can at times be either men or children) into forced prostitution. This is of course illegal everywhere: it’s repeated rape just as a very start. It is also vile and we should indeed be doing everything possible to stamp it out.

2) The illegal movement of willing people across borders to enter the sex trade. Strange as it may seem there really are people who desire to be prostitutes. People would, other things being equal, similarly like to be in a country where they get a lot of money for their trade rather than very little. Given these two we wouldn’t be surprised if people from poorer countries, who wish to be in the sex trade, will move from those poorer countries to richer countries. And such is the system of immigration laws that many of them will be unable to do this legally: just as with so many who wish to enter other trades and professions in the rich world. You can make your own mind up about the morality of this but it is obviously entirely different from definition 1).

June 19, 2013

Even the Chinese statistics office couldn’t accept these numbers

Filed under: Bureaucracy, China, Economics, Government — Tags: , , — Nicholas @ 07:57

In the Wall Street Journal‘s ChinaRealtime section, an amusing story about a local Chinese government whose official statistics were so unrealistic that the central statistics office called them out on it:

It’s typically advisable not to accept Chinese economic data at face value – as even the country’s own premier will tell you. Figures on everything from inflation and industrial output to energy consumption and international trade often don’t seem to gel with observation and sometimes struggle to stack up when compared with other indicators.

How the figures are massaged and by whom is as much a secret as the real data itself. But in an unusual move, the National Bureau of Statistics – clearly frustrated with the lies, damn lies – has recently outed a local government it says was involved in a particularly egregious case of number fudging, providing rare insight into just how we’re being deceived.

According to a statement on the statistics bureau’s website dated June 14 (in Chinese), the economic development and technology information bureau of Henglan, a town in southern China’s Guangdong province, massively overstated the gross industrial output of large firms in the area.

[. . .]

The statistics bureau doesn’t say why Henglan inflated its industrial output numbers. But indications that a local economy is sagging could reflect poorly on the prospects for promotion of local officials, and China’s southern provinces have been particularly hard hit by the global slowdown in demand for the country’s exports. Factories have closed, moving inland and overseas in search of cheaper labor, denting local government revenues.

“When governments are looking to burnish their track record, that can put the local statistics departments in a very awkward situation,” said a commentary piece that ran Tuesday in the Economic Daily (in Chinese), a newspaper under the control of the State Council, China’s cabinet. The article said that one of the biggest obstacles to ensuring accurate data is that the agencies responsible for crunching the numbers aren’t independent from local authorities. Moreover, it argues that penalties for producing fake data were too mild to act as a deterrent.

June 16, 2013

Chinese banks have a “hidden second balance sheet”

Filed under: China, Economics — Tags: , , — Nicholas @ 10:40

It’s been a while since I posted one of my links to articles about the Chinese economy. Time to redress that now:

“There is no transparency in the shadow banking system, and systemic risk is rising. We have no idea who the borrowers are, who the lenders are, and what the quality of assets is, and this undermines signalling,” she told The Daily Telegraph.

While the non-performing loan rate of the banks may look benign at just 1pc, this has become irrelevant as trusts, wealth-management funds, offshore vehicles and other forms of irregular lending make up over half of all new credit. “It means nothing if you can off-load any bad asset you want. A lot of the banking exposure to property is not booked as property,” she said.

[. . .]

Fitch warned that wealth products worth $2 trillion of lending are in reality a “hidden second balance sheet” for banks, allowing them to circumvent loan curbs and dodge efforts by regulators to halt the excesses.

This niche is the epicentre of risk. Half the loans must be rolled over every three months, and another 25pc in less than six months. This has echoes of Northern Rock, Lehman Brothers and others that came to grief in the West on short-term liabilities when the wholesale capital markets froze.

Mrs Chu said the banks had been forced to park over $3 trillion in reserves at the central bank, giving them a “massive savings account that can be drawn down” in a crisis, but this may not be enough to avert trouble given the sheer scale of the lending boom.

Overall credit has jumped from $9 trillion to $23 trillion since the Lehman crisis. “They have replicated the entire US commercial banking system in five years,” she said.

The ratio of credit to GDP has jumped by 75 percentage points to 200pc of GDP, compared to roughly 40 points in the US over five years leading up to the subprime bubble, or in Japan before the Nikkei bubble burst in 1990. “This is beyond anything we have ever seen before in a large economy. We don’t know how this will play out. The next six months will be crucial,” she said.

June 1, 2013

QotD: Internet espionage

Filed under: China, Humour, Quotations, Technology — Tags: , , , — Nicholas @ 08:26

A new report says that the Chinese are hacking American computer networks at an alarming rate. This is hardly news. I’ve been including the phrase “早安,我抱歉有沒有在這封電子郵件中的商業秘密或加拿大色情。請停止殺害酷動物啄木鳥醫學。剛剛買了一些偉哥了” at the bottom of every e-mail for months (I put it just above where it says “Hello Mr. Holder!”). It means, according to Google translate: “Good Morning, I’m sorry there’s no trade secrets or Canadian porn in this e-mail. Please stop killing cool animals for pecker medicine. Just buy some Viagra already.”

What is new is the scope of the problem the report lays out. This is a thorny issue and I think the U.S. needs to be much, much more aggressive in combating it. Why it’s not a bigger issue for the WTO, for instance, is baffling to me. They are stealing our stuff, which strikes me as a bigger deal than taxing it at the border.

Explaining to the Chinese leadership that they shouldn’t be doing this because it’s wrong is like explaining to a dog licking its nethers that what he’s doing is bad manners: To the extent they understand at all, they couldn’t care less. They respect power. They understand when you put a price on bad behavior. So we need to put a price on Chinese hacking. It’s really that simple. The hard thing to figure out is how.

Jonah Goldberg, “Chiiiiiicoms in (Cyber) Spaaaaaaaaaaaace!”, The Goldberg File, 2013-05-31

March 30, 2013

All those manufacturing jobs are never coming back

Filed under: Britain, Business, China, Economics, USA — Tags: , — Nicholas @ 08:37

Tim Worstall explains why this is at the Adam Smith Institute blog:

I’m always rather puzzled by those who shout that we’ve got to bring manufacturing back to the UK. Apparently this will solve all our problems over what to do with dim Northern lads or something. Once they’re all hammering out whippet flanges then we just won’t have a problem with unemployment ever again. The problem with this idea is that modern manufacturing simply doesn’t provide many jobs. And if it were to provide mass employment it would be very badly paid employment too:

    Americans working to produce traded goods and services earn, roughly, according to their productivity. If low-skill workers in America aren’t much more productive in manufacture of traded goods and services than low-skill workers in China, then they can’t earn much more than workers in China while being employed in manufacture of traded goods and services. They can earn a rich-world wage in production of non-traded goods and services, like sandwiches and haircuts, so long as there is sufficient local demand. In other words, the only way to get less-skilled Americans a good wage in a manufacturing industry is to significantly raise their skill and productivity level. If that can’t be accomplished, they can only hope to find good wages in non-traded industries. At least, that is, until wages of less-skilled workers across the developing world come much closer to converging with those in America.

Of course, that’s all about America but the same logic pertains here as well. Chinese manufacturing wages are around $6,000 a year at present. Meaning that if we had mass employment in manufacturing, as they do, then wages would need to be around that level. Or, alternatively, UK based manufacturing would have to be much more productive to support higher wages. And “more productive” is the same as saying “uses less labour”. Thus you can have few well paid jobs (in the Rolls Royces etc of this world) or you can have many badly paid jobs (Shenzen). It isn’t actually possible to mix and match between the two.

March 7, 2013

North Korea rhetorically re-starts the not-officially-ended Korean War

Filed under: China, Military, USA — Tags: , , , — Nicholas @ 09:46

The Chinese news agency Xinhua reports that North Korea wants to scrap the armistice that brought the Korean War to a halt in 1953:

The Democratic People’s Republic of Korea (DPRK) has vowed to nullify an armistice that ended the 1950-53 Korean War from March 11, and warned of more and stronger countermeasures if the United States and South Korea continued joint military drills.

The announcement, made by DPRK’s top Army Supreme Command on a rare appearance on the state TV, came when the UN Security Council is ironing out penalties against Pyongyang over its third nuclear test on Feb. 12. Diplomats said that a Council resolution condemning the test and toughening sanctions on DPRK will be put to a vote as early as this week.

March 11 marks the start of the annual joint South Korea-U.S. military exercises, which will involve 10,000 South Korean and 3,500 U.S. troops. The drill, dubbed Key Resolve, was denounced by DPRK’s official KCNA news agency as a prelude to an invasion.

Experts said the DPRK’s latest move aims to defy the possible new UN sanctions and seeks to replace the armistice agreement with a peace treaty that guarantees Pyongyang’s security, as requested by DPRK at the six-party talks.

March 5, 2013

China claims the shipbuilding title

Filed under: Business, China — Tags: , , , — Nicholas @ 09:02

Strategy Page talks about the success of Chinese shipyards:

Last year South Korea lost its decade long battle with China to retain its lead in ship building. Because of a five year depression in the world market for shipping, South Korean ship exports fell 30 percent last year, to $37.8 billion. China, helped by government subsidies, saw ship exports fall only 10.3 percent, leaving China with $39.2 billion in export sales. The Chinese government has also been giving its ship builders lots of new orders for warships, which made its yards more profitable and better able to beat South Korea on price. The Chinese government also provides its ship builders with more loans, allowing the builders to offer better credit terms to customers. South Korea is still ahead of China in total orders for ships. As of last year South Korea had 35 percent of these orders versus 33.3 percent for China.

China has been helping its shipyards for over a decade and that has enabled Chinese ship builders to gradually catch up to South Korea and Japan. It was only four years ago, sooner than anyone expected, that China surpassed South Korea as the world’s largest shipbuilder in terms of tonnage. In late 2009, Chinese yards had orders for 54.96 million CGT of ships, compared to 53.63 million CGT for South Korea. Thus China had 34.7 percent of the world market. In 2000, South Korea took the lead from Japan by having the largest share of the world shipbuilding market.

CGT stands for Compensated Gross Tons. This is a new standard for measuring shipyard effort. Gross tons has long been used as a measure of the volume within a ship. CGT expands on this by adding adjustments for the complexity of the ship design. Thus a chemical tanker would end up with a value four times that of a container ship. China is producing far more ships, in terms of tonnage of steel and internal volume, than South Korea, mainly because a much larger portion of Chinese ships are simple designs. South Korea has, over the years, pioneered the design, and construction, of more complex ships (chemical, and Liquid Natural gas carriers.)

February 28, 2013

North Korea struggling with loss of faith in the state

Filed under: Asia, China, Government — Tags: , , , , , — Nicholas @ 08:50

Strategy Page on the challenges facing the government as the younger generation grows up:

A major source of information about North Korea is obtained by South Korean intelligence experts interviewing the steady flow of refugees arriving in South Korea (via China and the South Korean embassies in neighboring countries like Thailand). For the last decade, over a thousand of these refugees have arrived each year. In the last few years China and North Korea have increased their efforts to reduce that number, which peaked at 2,900 in 2009 and was 1,500 last year. These determined and desperate people keep coming. Separate interviews are compared and checked against each other to obtain an updated and accurate first-hand view of life in the north. This also helps detect the spies North Korea tries (often with success) getting into the south via the refugee route. While the refugees detail the growing decline in living standards up north, it’s also become clear that there is a very real generational shift in loyalties in the north. The generation who grew up during the 1990s famine (that killed about ten percent of the population and starved most of the rest for years) no longer believe in the North Korean dictatorship. Many who came of age before 1990 still do, but for most everyone under 30 the state is the enemy and self-reliance, and not a benevolent dictatorship, is the only way to survive. The North Korean government has been fighting these attitudes more and more, as this generation of unbelievers grows larger each year. The more astute members of the northern leadership see this as a no-win situation. Eventually most North Koreans will be very hostile to the state and more adept at making money in spite of the government, or simply getting out of the country. Most of the leadership is still afraid of enacting Chinese style economic reforms because they believe a more affluent population would seek revenge for the decades of misrule and tyranny. The Chinese say that didn’t happen in China. The North Koreans point out that, as bad as the Chinese communists were in the 1950s and 60s (killing over 50 million people via starvation, labor camps and execution) that was not as bad (proportionately) as what the North Koreans have suffered. Moreover, the North Korean leaders point out that, historically, Koreans have been a bit more excitable and brutal when aroused by misrule. The Chinese say times have changed but the North Korean leaders are not yet willing to bet their lives on that being the case.

The refugees report that most North Koreans understand that the police state up there is strong enough to suppress any uprising now or in the foreseeable future and that the only real threat to the dictatorship is intervention (openly or via a coup) by China. Refugees also report that it’s common knowledge that hundreds of North Koreans have died of radiation poisoning or been born with birth defects because of the uranium mining and working with nuclear materials. The government has responded by offering large cash bonuses to those who will work in the uranium mines. The refugees report in detail many other ways the Kim government abuses their subjects.

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