The Art of Self-Censorship

Bloomberg Code Keeps Articles From Chinese Eyes

By EDWARD WONG
A Man Under the Influence: Matthew Winkler, the editor in chief of Bloomberg News.

In early 2011, during a period of heightened tension between the Chinese government and foreign journalists, Bloomberg News created coding to give editors the ability to categorize stories under a new class, called 204. 

Such stories would not show up on Bloomberg terminals in mainland China. 

Managers did this after Chinese officials stressed to top editors in Hong Kong that the license granted to Bloomberg by the State Council allowed the company to publish only financial data and news on its terminals, not political news, employees said.
Within Bloomberg, the code has its critics. 

“I think of this as self-censorship,” said one journalist, who added that editors choose to apply the code to any article that might offend senior Chinese officials. 

The code’s defenders, though, explained to their colleagues in internal conversations that Bloomberg must abide by the definition of its State Council license — or at least by the narrowest definition put forward by Chinese officials. 

Two Bloomberg spokespeople have declined to comment on the code.
The use of Code 204 was first reported by The New York Times this month in articles that looked at another accusation of self-censorship. 

Specifically, top Bloomberg editors decided in late October not to publish an investigative article on China’s wealthiest man, Wang Jianlin, and his financial ties to the families of party leaders. 

Several Bloomberg employees said Matthew Winkler, the editor in chief, justified killing the article by saying in a conference call that Chinese officials would not tolerate articles on the assets of the leadership. 

How has Code 204 been used, and what are some of the articles that Bloomberg editors have decided to keep off mainland China terminals? (Bloomberg L.P. has 2,000 to 2,500 terminals in China, a tiny fraction of the total worldwide, according to Norman Pearlstine, the company’s former chief content officer, who gave the estimate at a talk in New York this month.)
“It’s very loosely applied,” a former employee said of Code 204.
A person with access to a terminal in mainland China ran a check on a handful of Bloomberg News articles to see whether they could be seen inside China. 

One article missing from those terminals is the June 2012 investigation into the assets of close family members of Xi Jinping, who became the Communist Party chief last November. 

Before it ran, Chinese officials pressed Bloomberg to kill it; Bloomberg defied those admonitions and suffered the consequences — state enterprises stopped buying terminal subscriptions, Bloomberg’s website was blocked in China and applications by Bloomberg journalists for new residency visas have not been approved. (The Times was similarly punished after it ran an investigative article on the Chinese prime minister’s family in October 2012, though it does not sell financial data terminals.)
The Xi article was the first installment in an ambitious three-part series called “Revolution to Riches,” which looked at the wealth of the party’s revolutionary families. 

The second article in the series, an examination of the family wealth of China’s Eight Immortals, some of the party’s most revered leaders, also cannot be seen on mainland terminals.
By contrast, an article early in 2012 about the assets of family members of Bo Xilai, a senior party official who had by then become embroiled in a murder scandal, does show up on the terminals.
The sensitivities around reporting on Mr. Bo took sharp turns in 2012. 

Chinese officials clamped down on articles about him and his family when the scandal first emerged in March 2012. 

Chinese news organizations were generally not allowed to report on Mr. Bo, and his name was banned from the search engines of China’s biggest microblogs. 

But as the party began to control the narrative surrounding the scandal, officials largely stopped trying to restrict coverage of Mr. Bo.
It is unclear whether Bloomberg editors took all this into account when deciding to keep their story on the Bo family, first published in April 2012, on the mainland terminals.
An article that is missing from mainland terminals is the one that, more than any other, might have helped catalyze the creation of Code 204. 

It is a story about political protests that ran on Feb. 21, 2011, and it is what prompted Chinese officials to cite the terms of Bloomberg’s State Council license to top editors in Hong Kong, employees said. 

The article was a lengthy explanation written from the Beijing bureau about calls on the Internet for peaceful “Jasmine Revolution”-style protests in China modeled after the uprisings in the Middle East. 

It even had the Chinese words for Jasmine Revolution — 茉莉花革命 — in the text. 

Chinese officials, fearful that word of the protests would become widespread, had been trying to block any websites and mobile phone text messages that used those words.
Soon after the conversation with Chinese officials, Bloomberg editors deleted the story from the Bloomberg website, even though the site is global and not China-specific, employees said. 

This prompted an outcry from Bloomberg journalists in China, and editors later restored it, though it cannot be found with the site’s search engine. (A version of it shows up in a Google search.) 

Employees said they recalled that it was possible to read the article on the mainland terminals. 

But as of last week, the article could no longer be found there. 

Editors might have applied Code 204 to the article after the code’s creation, which occurred in the wake of Bloomberg’s conflicts with Chinese officials over Jasmine coverage. 

One person said he believed there was a way to apply Code 204 retroactively to articles, so that stories that appear on mainland terminals upon general publication can later be taken off.
An article published on Feb. 23, 2011, about a letter on a Chinese-language website operated from the United States, Boxun.com, calling for more Jasmine rallies, is also missing from both mainland terminals and the Bloomberg website. 

As with the Feb. 21 article, it appears on terminals outside China.
There are some Jasmine-related articles, though, that show up on mainland terminals — for example, one published on March 1, 2011, in which a Chinese foreign ministry official said police officers had “properly handled” foreign journalists at a Jasmine protest site in central Beijing.
One Bloomberg employee said the existence of Code 204 can result in writers internalizing self-censorship. The code then becomes unnecessary because the writer has already decided to withhold information in order to ensure that terminal users in China can read the story, he said.
“If you wanted your story not to go by that code, then you don’t make sensitive references,” he said. 

“This where the self-censorship gets self-reinforcing.”

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Low Profile

China aircraft carrier 'avoids' Senkakus en route to training
THE ASAHI SHIMBUN

BEIJING--China’s first aircraft carrier steered clear of the Senkaku Islands now under the country’s newly designated air defense zone on the way to its maiden exercise in the high seas.
The 67,000-ton Liaoning left its home port of Qingdao, Shandong province, on Nov. 26, and entered the South China Sea through the Taiwan Strait on Nov. 28, according to the state-run Xinhua News Agency.
Observers were watching whether the ship would travel along the Chinese continent and through the Taiwan Strait or head for the Pacific Ocean across waters around Okinawa Prefecture.
If the Liaoning had passed near the Senkakus, administered by Japan as part of Okinawa, it could have fueled tensions with Tokyo and Washington.
Four warships are accompanying the aircraft carrier for an extended exercise in the South China Sea, where China has territorial disputes with Vietnam and the Philippines.
“(The Liaoning’s route) has nothing to do with the regional situation,” Chinese defense ministry spokesman Yang Yujun told a news conference Nov. 28. 

“We ask you not to overstretch (the meaning of the route).”
Beijing’s designation of an air defense zone in the East China Sea on Nov. 23 has drawn sharp criticism from Tokyo and Washington as a unilateral attempt to undo the status quo.
U.S. bombers on Nov. 26 flew through China’s Air Defense Identification Zone without giving advance notice demanded by Chinese authorities.
According to Taiwan’s defense ministry, the Liaoning did not cross the median line between China and Taiwan when it navigated through the Taiwan Strait.

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Paper Dragon

US forces operating 'normally' in China air zone. Japan and South Korea both disregarded the ADIZ, showing a united front after US B-52 bombers entered the area.
AFP

Beijing — US military chiefs have insisted they will not change their operations despite China scrambling fighter jets to monitor American and Japanese aircraft in Beijing's newly declared air defence zone.

But the State Department said US commercial airlines should observe China's demand to be given notice of aircraft entering the zone, while stating that compliance "does not indicate US government acceptance of China's requirements".
China flew warplanes into its air defence identification zone (ADIZ) on Friday, Chinese state media said, nearly a week after it announced the zone, which covers islands at the centre of a dispute between Beijing and Tokyo, raising regional tensions.
The Xinhua report indicated that Japan and the United States are continuing to disregard China's demands that aircraft submit flight plans when traversing the area in the East China Sea or face unspecified "defensive emergency measures".
"We have flights routinely transiting international airspace throughout the Pacific, including the area China is including in their ADIZ," Pentagon spokesman Colonel Steve Warren said on Friday.
"These flights are consistent with long-standing and well-known US freedom of navigation policies that are applied in many areas of operation around the world. I can confirm that the US has and will continue to operate in the area as normal."
Compliance by commercial flights "does not indicate US government acceptance of China's requirements for operating in the newly declared ADIZ," the State Department said in a statement.
Japanese airlines, under pressure from Tokyo, stopped following China's new rules on Wednesday, after initially complying.
In its evening edition Saturday, the Yomiuri Shimbun newspaper said Japan's two biggest airlines were unlikely to change their stance even after the US announcement that commercial airlines should observe China's demand.
Japan Airlines said it had "no plan to change our stance at the moment" while All Nippon Airways said it would follow instructions from the transport ministry, the daily reported the two companies as saying.
Chinese air force spokesman Shen Jinke said Friday that several combat aircraft were scrambled to "verify the identities" of US and Japanese aircraft entering the air defence zone, according to Xinhua.

The Chinese planes, which included at least two fighter jets, identified two US surveillance aircraft and 10 Japanese aircraft including an F-15 warplane, Shen said.
Japan and South Korea both said Thursday they had disregarded the ADIZ, showing a united front after US B-52 bombers also entered the area.
Despite the scrambling of jets referred to in China's state media, Japanese Defence Minister Itsunori Onodera on Saturday said there were no "peculiar developments".
"We do not recognise there have been peculiar developments that we should disclose such as one where aircraft suddenly came close as the Chinese side announced yesterday," he said.
"We have been making our utmost efforts to be vigilant and we will continue," he added.
Onodera also called on China to use "common sense" over the air defence zone.
"It is important for both sides to respond in a calm manner," he said, according to the Kyodo news agency. "We want (China) to deal with this issue according to common sense in the international community".
Beijing is facing considerable internal pressure to assert itself. 

China's state media called Friday for "timely countermeasures without hesitation" if Japan violates the zone but it shied away from threatening Washington.
Washington has security alliances with both Tokyo and Seoul, and analysts say that neither China nor Japan -- the world's second and third-biggest economies, and major trading partners of each other -- want to engage in armed conflict.
The Communist Party seeks to bolster its public support by tapping into deep-seated resentment of Japan for its invasion of the country in the 1930s.
Such passions are easily ignited, and posters on Chinese social media networks have urged Beijing to act.
China's rules covering the zone require aircraft to provide their flight plan, declare their nationality and maintain two-way radio communication -- or face unspecified "defensive emergency measures".
Both Japan, which denies that there is a dispute over the islands, and Washington have ADIZs of their own, and China accuses them of double standards -- though China's zone includes a rock that is disputed between Beijing and Seoul, as well as islands controlled by Japan and claimed by China.
The European Union added its voice to the criticism of the zone, with its top foreign affairs official Catherine Ashton saying it "contributes to raising tensions in the region".
The Yomiuri Shimbun on Saturday reported that the United States and Japan would issue a joint statement demanding China scrap the air zone during a visit to Tokyo by US Vice President Joe Biden next week. Biden will meet Prime Minister Shinzo Abe on Tuesday.

B-52 diplomacy

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China, India spar over disputed border

Reuters

China's President Xi Jinping (R) talks with India's Prime Minister Manmohan Singh (L) during a meeting at the Diaoyutai State Guesthouse in Beijing October 23, 2013.

China on Saturday urged India not to aggravate problems on the border shared by the two nations, a day after the Indian president toured a disputed region and called it an integral part of the country.
The two countries, which fought a brief border war in 1962, only last month signed a pact to ensure that differences on the border do not spark a confrontation.
But Indian President Pranab Mukherjee's visit to the state of Arunachal Pradesh in the remote eastern stretch of the Himalayas that China claims as its own provoked a fresh exchange of words.
"We hope that India will proceed along with China, protecting our broad relationship, and will not take any measures that could complicate the problem, and together we can protect peace and security in the border regions," China's official news agency, Xinhua, quoted Qin Gang, a spokesman of the country's Ministry of Foreign Affairs, as saying.
"Currently Sino-India relations are developing favorably and both sides are going through special envoy meetings and amicable discussions to resolve the border dispute between our two countries."
Mukherjee was on a routine visit to Arunachal which has been part of the Indian state for decades, and where India has regularly been holding elections. 

But China has of late grown increasingly assertive and questioned New Delhi's claims over the territory, calling it instead South Tibet.
Mukherjee told members of the state's legislative assembly it was "a core stakeholder in India's Look East foreign policy" that intends to link the country's northeast with South East Asia.
"We seek to make our neighbors partners in our development," Mukherjee said in Itanagar, the state capital. "We believe that India's future and our own best economic interests are served by closer integration with Asia."
China lays claim to more than 90,000 sq km (35,000 sq miles) disputed by New Delhi in the eastern sector of the Himalayas, while India says China occupies 38,000 square km of its territory on the Aksai Chin plateau in the west.

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Face-off

Like a teenager on a growth spurt who doesn’t know his own strength, China has underestimated the impact of its actions. 

The Economist

THE announcement by a Chinese military spokesman on November 23rd sounded bureaucratic: any aircraft flying through the newly designated Air Defence Identification Zone (ADIZ) in the East China Sea must notify Chinese authorities in advance and follow instructions from its air-traffic controllers. 

America’s response was rapid. 

On November 26th Barack Obama sent two B-52 bombers to fly through the new zone without notifying China. 

This face-off marks the most worrying strategic escalation between the two countries since 1996, when China’s then president, Jiang Zemin, ordered a number of exclusion zones for missile tests in the Taiwan Strait, leading America to send two aircraft-carriers there.
Plenty of countries establish zones in which they require aircraft to identify themselves, but they tend not to be over other countries’ territory. 

The Chinese ADIZ overlaps with Japan’s own air-defence zone (see map). 

It also includes some Japanese specks of rock called the Senkaku islands, as well as a South Korean reef, known as Ieodo. 

The move is clearly designed to bolster China’s claims. 

On November 28th Japan and South Korea sent aircraft into the zone.

Teenage testosterone
Growing economic power is bound to go hand-in-hand with growing regional assertiveness. 

That is fine, so long as the behaviour of the rising power remains within international norms. 

In this case, however, China’s does not; and America, which has guaranteed free navigation of the seas and skies of East Asia for 60 years, is right to make that clear.
How worrying China’s move is depends partly on the thinking behind it.

It may be that, like a teenager on a growth spurt who doesn’t know his own strength, China has underestimated the impact of its actions. 

The claim that America’s bombers had skirted the edge of the ADIZ was gawkily embarrassing. 

But teenagers who do not realise the consequences of their actions often cause trouble: China has set up a casus belli with its neighbours and America for generations to come.
It would thus be much more worrying if the provocation was deliberate. 

The “Chinese dream” of Xi Jinping, the new president, is a mixture of economic reform and strident nationalism. 

The announcement of the ADIZ came shortly after a party plenum at which Mr Xi announced a string of commendably radical domestic reforms. 

The new zone will appeal to the nationalist camp, which wields huge power, particularly in the armed forces. It also helps defend Mr Xi against any suggestions that he is a westernising liberal.
If this is Mr Xi’s game, it is a dangerous one. 

East Asia has never before had a strong China and a strong Japan at the same time. 

China dominated the region from the mists of history until the 1850s, when the West’s arrival spurred Japan to modernise while China tried to resist the foreigners’ influence. 

China is eager to re-establish dominance over the region. 

Bitterness at the memory of the Japanese occupation in the second world war sharpens this desire. 

It is this possibility of a clash between a rising and an established power that lies behind the oft-used parallel between contemporary East Asia and early 20th-century Europe, in which the Senkakus play the role of Sarajevo.

Seas of troubles
Tensions are not at that level. 

Japan’s constitution bans it from any military aggression and China normally goes to great lengths to stress that its rise—unlike that of Japan in the 1920s and 1930s—will be peaceful. 

But the neighbours are nervous, especially as the establishment of the ADIZ appears to match Chinese ambitions in the South China Sea.
Chinese maps show what is known as the “nine-dash line” encompassing all the South China Sea. 

In the wake of the global financial crisis, perhaps believing its own narrative of Chinese rise and American decline, it began to overreach in its dealings with its neighbours. 

It sent ships to disputed reefs, pressed foreign oil companies to halt exploration and harassed American and Vietnamese naval vessels in the South China Sea. 

These actions brought a swift rebuke from America’s then secretary of state, Hillary Clinton, and China appeared to back off and return to its regional charm offensive. 

Some observers say that the government is using the ADIZ to establish a nine-dash line covering the East China Sea as well. 

They fear China’s next move will be to declare an ADIZ over the South China Sea, to assert control over both the sea and the air throughout the region.
Whether or not China has such specific ambitions, the ADIZ clearly suggests that China does not accept the status quo in the region and wants to change it. 

Any Chinese leader now has an excuse for going after Japanese planes. 

Chinese ships are already ignoring Japanese demands not to enter the waters surrounding the disputed islands.
What can be done? 

Next week Joe Biden, America’s vice-president, arrives in China. 

The timing may be uncomfortable, but it is fortuitous. 

Mr Biden and Mr Xi know each other well: before Mr Xi became president, he spent five days in America at Mr Biden’s invitation. 

Mr Biden is also going to South Korea and Japan.
America’s “pivot” towards Asia is not taken very seriously there: Mr Obama is seen as distracted by his domestic problems. 

Mr Biden could usefully make clear America’s commitment to guaranteeing freedom of navigation in the region. 

Japan and South Korea, who squabble over petty issues, need to be told to get over their differences. 

As for China, it needs to behave like a responsible world power, not a troublemaker willing to sacrifice 60 years of peace in north-east Asia to score some points by grabbing a few windswept rocks. 

It should accept Japan’s suggestion of a military hotline, similar to the one that is already established between Beijing and Washington.
The region must work harder to build some kind of architecture where regional powers can discuss security. If such a framework had existed in Europe in 1914, things might have turned out differently.

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Isolation Under House Arrest for Wife of Imprisoned Nobel Laureate

By AUSTIN RAMZY

Liu Xia, the wife of the imprisoned Chinese Nobel laureate Liu Xiaobo, says she feels completely isolated living under house arrest in Beijing and finds rare happiness in reading, according to a July letter.
“My reading has no specific goal; for me it’s rather like breathing — I have to do it in order to live,” she wrote.
“When I find books that I love, I feel the author is writing for me alone, and feel a private joy.”
The letter offers a rare insight into the life of a woman who has been largely disappeared since her husband was awarded the Nobel Peace Prize three years ago.
Ms. Liu receives visits from family members but is otherwise shut off from the world.
Rights groups say her extrajudicial detention is meant to put pressure on her imprisoned husband and to prevent her from becoming a public advocate for his cause.
She is allowed monthly visits with Mr. Liu at his prison in northeastern China, where he is serving an 11-year sentence on charges of “inciting subversion of state power” for his role in writing and organizing signatures for Charter 08, a pro-democracy manifesto.
A copy and translation of the letter was provided to The New York Times by Perry Link, a professor at the University of California, Riverside.
Mr. Link said he received the letter from a Los Angeles-based activist, Ann Lau.
The addressee’s name was removed from the copy he received, Mr. Link said.
Mr. Link said he was confident of the letter’s authenticity.
Zeng Jinyan, a Hong Kong-based activist and friend of the Liu family, saw a copy of the letter and said the handwriting was Ms. Liu’s.
Jean-Philippe Béja, a China scholar who has written extensively about Mr. Liu, said he had seen the letter and had no doubts about it.
In the letter, Ms. Liu writes about the importance of reading to her daily existence, a habit that she says she grew up with but that has become pronounced in her isolation.
She describes herself as “feeding on books” and says one work she was recently consuming was a history of the Soviet gulag.
She offered a poem she had written in 2011 that offers a pessimistic vision of her life:

The future, for me,

Is a shut window.

The night within has no end

And the horrid dreams do not fade.

Ms. Liu goes on to say that she was doing much better since she wrote that poem.
“This is because all of you have helped me to open the window and let the sun rise. I know that all of this is not the end — even if justice is too long in coming,” she wrote.
“‘Eleven years’ in duplicate now weigh on me,” Ms. Liu wrote, probably a reference to both her husband’s sentence and and that of her younger brother, Liu Hui, who was given an 11-year prison term in June over financial fraud, a case that family and supporters say was politically motivated.
Mr. Béja said that from her letter, Ms. Liu’s outlook seemed positive, but it was possible she was putting on a brave face.
“I find her in a better mental state than I would have thought, given her situation,” he said.
“She is writing to a friend, so it’s hard know if she wants to reassure them or if she is really telling her state of mind.”
A group of reporters from The Associated Press visited Ms. Liu in December 2012, slipping past her guards while they were on lunch break.
She trembled and cried while speaking with the journalists, calling her situation absurd and physically draining.
Ms. Liu wrote an open letter to President Xi Jinping of China in June, denouncing her detention and the treatment of her family.
“Perhaps in this country it’s a ‘crime’ for me to be Liu Xiaobo’s wife,” she wrote.
Ms. Zeng, the Hong Kong-based activist, said she was worried that Ms. Liu’s extreme isolation was exacting a heavy psychological toll, but suspected that Ms. Liu would be wary of receiving any care provided by the authorities detaining her.
“I can understand why she would be fearful of seeing a doctor when the police are with her,” she said.
For now she gets what support she can from reading, said Ms. Zeng.
“Her daily life is trying to do more reading,” she said.
“She gets power and peace from books.”
Below is a copy of the letter as translated by Perry Link:
Dear XXX,
I’ve read your “epistolary novel.” 
If I imagine myself an outside reader, I can only wonder how or through what special power you manage to keep on writing when the protagonist for whom you are pleading is absent. 
It moves me.
I have always loved reading, and do much of it. 
Most of the books in our home are ones I personally purchased and brought here, and most of the hours in my life are spent in reading them. 
I describe myself as having grown up “feeding on books.” 
My reading has no specific goal; for me it’s rather like breathing — I have to do it in order to live. When I find books that I love, I feel the author is writing for me alone, and feel a private joy.
In the 1980s I, too, wrote fiction and film scripts. 
I have faith that there will come a day when that absent person writes another part of his (her) story.
Please tell XXX that the book I am currently “feeding on” is A History of the Gulag.
Living in almost total isolation, I find the road before me populated by countless books. 
I hide among the books and meander in the world.
You can imagine how terrified I felt to face the world alone after they came to take Xiaobo away. 
I have had no choice but to accept that reality. 
I have been extremely tired.
Let me offer you one of my poems. 
Hah! This will be a challenge for your translator!

“Fragment 8”

The light of death

That often appears, as I gaze at my reading,

Feels warm.

I feel sad that I must leave.

I want to go to a place that has light.

That tenacity, mine for years,

Has turned to dust.

A tree

Can be felled by a bolt of lightning

And think nothing.

The future, for me,

Is a shut window.

The night within has no end

And the horrid dreams do not fade.

I want to go to a place that has light.

(Written in 2011)

“Eleven years” in duplicate now weigh on me, but I do not feel as depressed as when I wrote “Fragment 8.” 
This is because all of you have helped me to open the window and let the sun rise. 
I know that all of this is not the end — even if justice is too long in coming.
I chose this life myself, so need to see it through to the end.
In 1996, at the Holocaust museum in Washington, D.C., I bought a postcard that showed a pile of shoes of Jewish people. 
Since then, innumerable Jewish people have been standing in my memory. 
I think that some day we, too, will have a memorial building to remember those people who are slipping out of the memories of Chinese today. 
We will. For sure.
I’ll tell you a funny story. 
In 1996 when I was in Boston a friend invited me to go out drinking. 
We went from bar to bar, but they always asked to see my passport for proof that I was of drinking age. 
I was 35 then, but had left my passport in New York. 
My hair was long then, so I bundled it up and then let it go, repeatedly, hoping this would make me look old enough to drink. 
Finally, around midnight, we did get a drink at an outdoor bar. 
I’ll find a 1996 photo of me — maybe you Americans really can’t tell the age of Oriental people. 
The memory makes me want to chuckle. (A photo here)
Next time, I’ll write only about happy things.
XXXXXXXXX
Liu Xia
July 26, 2013

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With new air zone, China tests U.S. dominance in East Asia

BY GREG TORODE AND LINDA SIEG

China's new air defence zone, stretching far into East Asia's international skies, is an historic challenge to the United States, which has dominated the region for decades.
For years, Chinese naval officers have told their U.S. counterparts they are uncomfortable with America's presence in the western Pacific -- and Beijing is now confronting strategic assumptions that have governed the region since World War Two.
China's recent maritime muscle-flexing in disputes over the Paracel islands and Scarborough Shoal in the South China Sea and over Japanese islands in the East China Sea has stirred concern and extensive backroom diplomacy in Washington.
But it took the events of the last week to spark an immediate and symbolic response from the United States -- the unannounced appearance in the zone of two unarmed B-52 bombers from the fortified island of Guam, the closest U.S. territory to the Chinese coast.
China's unilateral creation of the zone -- accompanied by warnings that it would take "defensive emergency measures" against aircraft that didn't identify themselves -- has raised the stakes in a territorial dispute with Japan over tiny, uninhabited islands in the area.
Even as some suggest Beijing's move is already backfiring, experts in China say it is a part of a long-term effort, carrying broader historic significance for the United States as the traditional provider of Japanese security.
The regional tensions will loom large when U.S. Vice President Joe Biden travels to Japan, China and South Korea early next week.

STRATEGIC SPACE
Shi Yinhong, a professor of international relations at Renmin University who advises Beijing's State Council, said Washington had recognised China as a great trade and diplomatic power, and should now acknowledge China needs its own "strategic space".

Japan and South Korea, another treaty ally of the U.S., also sent military aircraft through the zone this week without informing China, lending muscle to earlier diplomatic protests.
For all the apparent boldness of China's move, some regional analysts believe Beijing has over-reached, in comparison to earlier campaigns of assertion. 

For example, China's rotating presence of ships in seas around Japan's Senkaku islands have continued without sparking a direct military response from Washington.
Some suggest the fact that Chinese planes have yet to attempt an interception in the air this week, despite the swift flouting of its demands, shows that Beijing's bluff has been called. 

They are also puzzled how the move fits with Beijing's vaunted "soft power" diplomacy -- on display recently as China's leaders toured South East Asia after U.S. President Barack Obama pulled out of a long-planned trip.
"What (President) Xi Jinping is trying to do is create a balance between soft and hard, conservatives and liberals. This is part of their trial and error process to get the right balance," said former senior Japanese diplomat Hitoshi Tanaka.
The fact China's zone overlaps Japan's -- including contested islands that the U.S. is obliged to defend under its treaty with Japan -- represents a dangerous strategic shift, U.S. officials say. 

And China's declaration it could take action against unidentified aircraft that ignored its warnings has sparked fears of an increased risk of accidents and miscalculations.
"It causes friction and uncertainty, it constitutes a unilateral challenge to the status quo in ... a region that is already fraught," one U.S. administration official said.

A LONG GAME?
In Tokyo, too, there is a sense that China is playing a long-term game -- even if Beijing struggles to enforce a move some analysts described as poorly thought out.
Speaking privately, one government source said that while it could damage Japan's "effective control" of disputed islands in the short-term, in the longer term it represented a push by Beijing to create a broad defensive zone across the East and South China Seas. 

"They don't feel safe without vast space between themselves and their enemies," the person said.
Narushige Michishita, a security expert at Tokyo's National Graduate Institute for Policy Studies, described the zone as a "bad step" for both Japan and China. 

"So far, China's move has backfired on it, but it might have longer term ... or internal political objectives," he said. 

"We should be cautious."

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With air-defence overreach, China has proven itself a paper tiger

By Matthew Fisher

A Chinese produced J-10 fighter jet is displayed outside the offices of the Aviation Industry Corporation of China in Beijing on November 28, 2013. The US on November 28 pressed its concerns over China's newly declared air defence zone, a day after US B-52s flew over the disputed area in the East China Sea.
TOKYO — To use an old Asian expression, is China just a toothless paper tiger?
Beijing threatened “emergency defensive measures” early this week against any aircraft, civilian or military, whose pilots had not received advance clearance from its aviation authorities to overfly islands and reefs that Beijing suddenly has claimed as part of an “air defence identification zone,” although the islands have have been under Japanese, South Korean and American (fairly briefly) administrative control since the 19th century.
The U.S. air force mocked China’s bellicosity by almost immediately flying a pair of lumbering, unarmed B-52 heavy bombers into the “protected air space.” 

After a moment’s hesitation, the country’s two major carriers, All Nippon Airways and Japan Airlines (JAL), acceded to a request by their government to continue flying in the area without informing the Chinese in advance. 

I flew directly over the Senkaku Islands on a JAL flight on Thursday without a hint of trouble.
Also on Thursday, Japan and South Korea sent military aircraft on uncontested patrols through China’s air defence zone without seeking permission.
For all its fierce rhetoric, until now China had reacted to the American bomber run and what it regards as unsanctioned overflights by Japanese and South Korean military and civilian aircraft by doing absolutely nothing. 

However, on Thursday, China, which had earlier claimed it was aware that the U.S. bombers had been there, belatedly sent warplanes into the maritime air defence zone.
Tensions have been growing since China’s dictatorship began asserting sweeping territorial claims over most of the South China Sea a few years ago. 

These assertions have also caused growing tensions with Taiwan, Malaysia, Vietnam, Brunei and, especially, the Philippines. 

China also has a toxic land dispute with India. 

In fact, the whole neighbourhood has been in high dudgeon over China’s expansive interpretation of what it owns, with the exceptions of Cambodia and Kim Jong-un’s North Korea.
Japan’s Shinzo Abe wrote late last year that China considered the South China Sea to be “Lake Beijing.” More provocatively, the right-wing politician wrote that nations such as India, Australia and the U.S. should form a “security diamond” to hem in China and keep the Indian and Pacific oceans open for unfettered maritime commerce.
China’s official media reported this week that in declaring an air defence zone, Beijing was behaving no differently than Canada. 

What it did not report was that although Canada and the U.S. jointly co-ordinate the North American “air defense identification zone,” which requires foreign aircraft to file a flight plan, it was not established above disputed territory.
This rough patch for China is jarring because everything had been going its way recently. 

Chinese President Xi Jinping was the beneficiary when U.S. President Barack Obama — who has made a lot of noise about a strategic pivot to Asia — postponed a four-nation tour of Asia in early October in order to try to untangle the budgetary fiasco with Congress.
Overplaying its hand by declaring a protected zone nearly the size of the British Isles has particularly soured China’s warming ties with South Korea, which has its own bitter historic differences with Japan. 

Nor was this China’s first international miscalculation this month. 

It also erred in its niggardly response to the typhoon disaster in the Philippines.
While much of the world, and especially the U.S., rushed to help Manila, China initially chose to do little to assist its neighbour. 

China did eventually send a hospital ship to Tacloban. But the vessel did not arrive until 16 days after typhoon Haiyan did.
With the Philippines still reeling from that monster killer storm, China made yet another aggressive move this week. 

Its new aircraft carrier, the Liaoning (actually an old, refurbished Ukrainian flat top) left its home port in northeastern China for the first time to begin deep water training manoeuvres with four guided missile ships near islets that the beleaguered Filipinos have long regarded as theirs. 

The battle group may sail these politically sensitive waters for several months, according to official Chinese media.
Most Asian nations, and Canada, have held their noses in recent years over China’s human rights record in order to trade with it.

It’s a policy the Harper government — without specifically naming China — officially enshrined as “economic diplomacy” in a report released Wednesday by the Department of Foreign Affairs, Trade and Development.
The latest countries to happily shake China’s hand have been Serbia, Romania and Hungary. 

Their leaders sealed a deal with a triumphant Premier Li Keqiang in Bucharest on Monday to build a high-speed rail link between the eastern European countries.
A complicating factor that is feeding the verbal skirmishes over the Western Pacific today is that the vast waters that China claims are, unsurprisingly, believed to be above large pools of oil and natural gas.
To prove that it’s more than a paper tiger, China is spending huge amounts of money on its armed forces. 

To protect their positions, India, South Korea and Japan have joined the Asian arms race, too.
The battle for hegemony in Asia is only beginning.

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Seoul Sees Territory Threat in China Defense Zone

South Korea Wary That Beijing Vying for Advantage With Disputed Rock
By ALASTAIR GALE And JEYUP S. KWAAK

South Korean Vice Defense Minister Baek Seung-joo, left, shakes hands with his Chinese counterpart, Wang Guangzhong, deputy chief of general staff of the Chinese People's Liberation Army, ahead of their talks in Seoul on Thursday. 

SEOUL—South Korea's forceful response to China's new air-defense zone despite otherwise warming ties reflects concern over Beijing's apparent move to tilt a long-running dispute over territorial waters in its favor, officials and analysts in Seoul said.
On Thursday, Seoul confirmed that a South Korean military plane had flown into the new Chinese zone on Tuesday without giving prior warning to Beijing, a day after the U.S. challenged the Chinese demarcation with two B-52 bombers.
South Korea also called for China to redraw its zone at high-level defense talks on Thursday and, after the request was rejected, said it would consider extending its own air-defense zone. 

Seoul says it will send further flights into the Chinese zone without advance notice.
The assertive stance contrasts with South Korea's initial response to China's declaration of the zone on Saturday. Seoul expressed concern but said then the issue would be resolved through dialogue.

A senior South Korean government official said that the more muscular approach was driven by Seoul's wish to reassert its claims over contested territorial waters within China's new zone, primarily an area of ocean around a submerged rock claimed by both Beijing and Seoul.
The rock, known internationally as Socotra Rock, and Ieodo in Korea, has been the subject of a dispute running for decades. 

The rock, northeast of Shanghai and southwest of the Korean island of Jeju, is one point of disagreement in a bigger dispute about the drawing of the countries' respective exclusive economic zones, or EEZ.
The rock, around 15 feet below sea level, lies in an overlapping section of the countries' EEZs. 

Under United Nations guidelines, a country has rights over use of marine resources in an EEZ within 200 nautical miles from its shores—but in case multiple countries' zones overlap, they must negotiate the maritime border.
Beijing and Seoul have met to discuss the issue 16 times previously without reaching consensus.

In 2003, South Korea completed the construction of a marine research center on the rock, including a helicopter landing pad.
A spokesman for South Korea's defense ministry the country's navy and coast guards conduct routine surveillance with aircraft around Ieodo about once or twice a week on average. 

The senior government official said Tuesday's military flight into China's claimed air-defense zone was made to demonstrate South Korea's jurisdiction over the waters around the rock.
On Monday, a spokesman for China's foreign ministry said there was no dispute over the rock and the issue would be resolved through dialogue.
South Korea's shift from its initially restrained response highlights the domestic pressure it faces with regards to territorial sovereignty, said Kim Han-kwon, director of the Center for China Policy at the Asan Institute for Policy Studies, a Seoul-based think tank.
Though the Chinese air-defense zone isn't set under international law—and has no impact on territory—South Korean politicians and media have treated China's move as an incursion, helping drive a stronger reaction from the government, Mr. Kim said.
"None of the countries (involved in the regional dispute) can step back at this point" or risk losing face, he said.
In addition to the dispute over the rock, South Korea has protested China's move to create 3,000 square kilometers of overlap in the two countries' air-defense zones in the East China Sea. 

After a senior Chinese military official rejected South Korea's demand for Beijing to redraw its zone, his South Korea counterpart said Seoul may increase its own zone, potentially creating further overlap.
The spokesman for the defense ministry in Seoul said the issue of extending South Korea's air-defense zone was under review but declined to provide further details about where it might be increased.
The dispute marks a sharp turn after months of progress in developing closer political and economic ties between Beijing and Seoul. 

During a state visit to Beijing by South Korean President Park Geun-hye in June, the two countries signed a number of agreements and are in discussions about a bilateral free trade agreement.
Ms. Park's personal interest in the Chinese language and culture has also been warmly received in China. South Korea has prioritized ties with China over Japan, which remains in dispute with Seoul over long-running historical and territorial issues.

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Questions raised over ‘China fever’ development on Mersey

By Lucy Hornby in Beijing, Jamil Anderlini in Jiangyin and Andrew Bounds in Manchester

The faded red banners welcoming the “Wirral council leaders” were propped against locked glass doors just inside the office of Sam Wa Resources Holdings on Tuesday in Jiangyin, a city on the banks of China’s Yangtze River.
This is the home of the company whose chairman Stella Shiu, is supposed to be the driving force behind a large Chinese investment in Britain.
However, there was no indication of a thriving business in the small dusty office, let alone a large mining and trading conglomerate, ready to invest millions of pounds to regenerate the Mersey riverside in northwest England.
The Peel Group, a British developer that is proposing a £10bn project along the Mersey river, signed a joint venture with Ms Shiu last year to attract tenants to the International Trade Centre, a £175m business development planned as part of the waterfront scheme.
This project is among a series of Chinese investments presented as proof that the British government’s business-oriented approach to diplomacy is paying off as David Cameron, UK prime minister, prepares to fly to Beijing this weekend.
However, a close look at Sam Wa suggests that not all of the deals are equal.
At one end of the spectrum are Chinese state-owned investors such as China General Nuclear Power Group, which will take a one-third stake in the French utility EDF’s project to build a £16bn atomic power station in southwest England.
These companies are effectively arms of the Chinese state which enjoy access to cheap credit from state banks and the full backing of the ruling Communist party.
At the other end of the scale are investors such as Ms Shiu, whose partners in other ventures include an Iranian pomegranate juice exporter and an investment adviser in New Jersey who recently settled US Securities and Exchange Commission allegations of fraud and violation of securities regulations.
Corporate filings in Hong Kong show that Ms Shiu changed her Chinese name after a 2008 ruling by a Hong Kong court that declared her bankrupt for failure to pay a loan.
Several companies registered under her former name have been dissolved on the Chinese mainland, including one in Jiangyin, and the address of Sam Wa’s headquarters in Beijing turns out to be a closely guarded military hotel that does not allow outsiders to enter.
“There are a lot of governments and companies in the west that are starved of capital, and so when the promise of Chinese billions comes along they tend to get ‘China fever’. Unfortunately it can sometimes be fatal,” says James McGregor, chairman for greater China at Apco Worldwide and author of the book No Ancient Wisdom, No Followers.
“In China you need to do due diligence on investors.”
Peel executives have made frequent trips to China, often with British local government officials in tow, and Ms Shiu has visited Liverpool many times.
On a visit in October, she helped Lindsey Ashworth, Peel Group development director, to open Peel’s latest office project.
He joked that he picked Ms Shiu as a partner because of her ability to drink him under the table.
On May 28 2012, Peel signed a joint venture with Ms Shiu at a ceremony in a Beijing hotel, attended by Lord Green, UK minister of state for trade and investment, and Phil Davies, Wirral council leader.
Peel’s proposed International Trade Centre would be built on desolate former docks on the Wirral peninsula, near Liverpool, one of the most deprived cities in the UK.
Once the second biggest port in the world, many of the wharves along the River Mersey are crumbling.
Demolition of existing buildings on the site has not yet begun.
Ms Shiu is supposed to help attract up to 1,000 companies from across Asia to move into 2.5m sq ft of self-contained units where they can exhibit, sell and distribute goods into the European market.
During his China visit, Mr Cameron plans to highlight the Merseyside scheme as an example of regeneration projects in the UK that are ready to be marketed to Chinese investors.
Council-owned investment agencies in Liverpool and the Wirral have maintained that Ms Shiu is a “high-ranking member of the Chinese government” who has put £25m into the project, echoing claims made in the local press.
Their publicity talks of Chinese government approval and the multibillion-dollar size of Ms Shiu’s group.
Liverpool Vision, the city investment agency, said it made the claims in “good faith” while Invest in Wirral declined to comment.
Richard Kemp, leader of the opposition Liberal Democrats on Liverpool city council, said local authorities should “remove their rose-tinted spectacles. There has been lots of talk and little result.”
The Financial Times was unable to find any evidence that Ms Shiu works for the Chinese government.
In Shanghai, Sam Wa’s address is a tiny cramped office belonging to an organisation called “Shanghai Enterprise Top 100 Association”.
Employees there were busy this week preparing Chinese-language pamphlets featuring photos of Ms Shiu with Mr Ashworth, in anticipation of Mr Cameron’s visit.
A visit to another Sam Wa address, at the prestigious Yintai Office Tower in Beijing, revealed no sign of the company.
The group’s stated interests include electronics manufacturing, import and export, timber trading and a large mining concession in the Philippines, described on the International Trade Center website as a gold mine.
On Chinese web portals, Sam Wa has posted offers to sell laterite ore, a type of iron ore with nickel content that is much sought after by Chinese steel mills.
In addition to Sam Wa, Ms Shiu is a partner in the Warner Fund, a Beijing-based private equity fund that offers to bring small Chinese companies public in the US.
One of her partners in that fund, David Huakang Zhou, and his New Jersey-based company Warner Technology and Investment Corp agreed to pay more than $1.4m in October this year to settle fraud allegations pursued by the SEC in connection with helping Chinese companies to list in the US, marketing their shares to unsophisticated Chinese investors living in the US and improperly using the proceeds.
Mr Zhou did not admit or deny the allegations.
Ms Shiu was not involved in the SEC complaint.
Ms Shiu and Peel Group both declined interview requests and did not respond to a list of emailed questions.

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Britain goes soft on rights to woo China

Britain has downgraded human rights as an issue when dealing with China, a move which has made it harder for other countries to talk tough on the subject.
By Kiran Stacey in London and Jamil Anderlini and Lucy Hornby in Beijing

Stella Shiu, right, at the site of the proposed £175m Wirral project with Lindsey Ashworth, development director

Britain has been accused of softening its stance on human rights in China to attract foreign investment, despite doubts over the credibility of some of the groups who have offered to fund big projects.
As David Cameron, prime minister, prepares for a long-awaited visit to Beijing, a Financial Times investigation has raised questions about a project with Chinese backing in northwest England.
The FT has identified several anomalies with Sam Wa, a Chinese company that has proposed an investment in the £175m development on the Wirral.
The investment has been championed by UK Trade and Industry.
Stella Shiu, Sam Wa’s chairman, was declared bankrupt by a Hong Kong court in 2008, after which she changed her name, it has emerged.
Several companies registered on the Chinese mainland under her previous name have since been dissolved.
Richard Ottaway, chairman of the foreign affairs select committee, told the FT: “UKTI has got to justify its actions, it has got to explain why it recommended investment from this group.”
The deal between Peel Holdings, the company leading the Wirral redevelopment, and Ms Shiu’s company was originally signed in the presence of senior UKTI officials, including Lord Green, trade minister.
It was touted as an example of the kind of deal that is being promoted by Mr Cameron as he focuses Britain’s relationship with China firmly on securing trade between the two countries.
The prime minister will travel to China next week for the first time since the new Chinese leadership took over, ending a year-long diplomatic stand-off over his decision to meet the Dalai Lama in 2012.
He will take a large trade delegation with him, including dozens of executives from blue-chip companies and others from small and medium-sized businesses.
But the trip comes amid mounting concern that Britain is so keen to sign new deals that it is failing to carry out enough due diligence on prospective investors.
One of the biggest projects to have attracted Chinese backing is a £1bn property development in London’s docklands.
But Advanced Business Park, a Chinese company planning an office complex on the site, has only one completed project to its name: a development located on the far outskirts of Beijing in the city’s least affluent district.
John Spellar, a Labour member of the all party group on China, told the FT: “UKTI and the Foreign Office have to be careful and undertake due diligence to make sure of the bona fides and assets of any potential investors.”
Senior diplomats in China believe Britain may be going too far in trying to encourage inward investment into the country.
“Total capitulation” was the way one senior Beijing-based Asian diplomat described Britain’s climbdown over the Dalai Lama debacle.
“The whole situation has been poorly handled – 18 months ago Mr Cameron was the great defender of human rights speaking truth to China and saying the UK will act on principle, but now it seems to be about business and nothing else,” said Kerry Brown, an associate fellow at Chatham House and a former British diplomat.
“There’s a strong case to engage with serious Chinese companies and to welcome their investment, but some of the companies people like Boris Johnson are talking to have no record abroad at all. It all seems extremely unsophisticated.”
One senior European diplomat said it was clear from internal European meetings that Britain had downgraded human rights as an issue when dealing with China, a move which has made it harder for other countries to talk tough on the subject.
Most of the dozen or so senior diplomats who spoke to the FT on the matter said Britain’s willingness to downgrade human rights was unlikely to help it deal with Beijing, which would only sense weakness in its about-face.
Another European diplomat said that by agreeing to allow more Chinese investment in its telecoms, nuclear and banking sectors as a way of getting back in Beijing’s good graces, the UK had given far more than any other European country would consider.
“It certainly appears that they have sold the store and what are they actually getting in return?” asked one senior diplomat in Asia.

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China looks to redraw Asian airspace

      

By Demetri Sevastopulo in Hong Kong

When China created a controversial “air defence identification zone” last Saturday, it sparked alarm about the rising risk of Sino-Japanese conflict over the Senkaku Islands.
But while the focus has been on the Japanese chain, China also said in the same statement it “will establish other air defence identification zones at the right moment after necessary preparations are completed”, raising the spectre of tensions spreading across the region.

The Senkaku spat has attracted much attention over the past year because of the potential for war between Asia’s two biggest economies.
But China is engaged in a number of equally contentious territorial disputes with Southeast Asian nations – particularly the Philippines and Vietnam – over the resource-rich South China Sea.
Ian Storey, a security expert at the Institute of Southeast Asian Studies in Singapore, said the most obvious candidates for any new Chinese air defence zones were the northern part of the South China Sea and the Yellow Sea.
Chinese maps often include a controversial “nine-dash line” that loops the South China Sea, running close to the coasts of Vietnam, the Philippines and Malaysia, and stretching south to Indonesia.
It first emerged in a 1947 Republic of China map that was later used by the Communist government of Mao Zedong when it came to power in 1949.
While some Chinese scholars say China does not claim the entire South China Sea, the use of the map has sparked concern among Southeast Asian nations.

China last year started issuing passports that included an image of the “nine-dash line”, provoking angry responses from Vietnam, Indonesia and the Philippines.
Mr Storey said China would probably not create an ADIZ for the whole South China Sea, saying it would be “absolutely outrageous” if they included the whole area inside the “nine-dash line”.
Instead, he said China was more likely to establish a zone in the northern part of the sea, and particularly surrounding Hainan Island.
Hainan hosts the Chinese navy’s South Sea fleet – one of its three naval fleets – and also a new generation of nuclear submarines that are an increasingly important part of China’s naval capabilities in the South China Sea.
But Mr Storey added that creating an ADIZ over even some of the South China Sea would be “unnecessarily provocative” at a time when China is trying to reduce tensions with its Southeast Asian neighbours.

In October, Chinese President Xi Jinping took advantage of the absence of US President Barack Obama at the Apec summit in Indonesia to launch a charm offensive with Southeast Asian countries, including by floating the idea of creating an “Asian infrastructure bank” to promote development in the region.
Chinese Premier Li Keqiang then embarked on a tour of Southeast Asia that was widely seen as an effort to repair relations.
The creation of an ADIZ over the South China Sea would be unlikely to generate the same kind of military response that occurred this week when the US flew B-52 bombers near the Senkaku without alerting China – mainly because, with the exception of Singapore, most Southeast Asian nations have limited air power.
But Gary Li, a senior analyst at IHS maritime, said a Chinese ADIZ in the northern South China Sea would be “very, very sensitive”.
He said it would almost certainly overlap with Vietnam’s ADIZ, which reaches north to about 100km from Hainan Island, and includes the disputed Paracel Islands.
Mr Li said the Yellow Sea was also a contender for a new Chinese ADIZ.
China has repeatedly criticised the US and South Korea for holding joint military exercises in the Yellow Sea, which lies between east China and the Korean peninsula, and particularly so when the US sails its aircraft carriers through the area.
Wu Shicun, president of the National Institute for South China Sea Studies in Hainan, a think-tank that advises the Chinese foreign ministry, said that while China had the right to create new zones, it would take its time.
“We cannot rule out the possibility of setting up new ADIZs, but not in the short term,” said Mr Wu.
“Given the strong reaction from the international community to the East China Sea ADIZ, China will further evaluate when and how to set up new ADIZs. But it will happen sooner or later, since it is related to its national security.”
Shi Yinhong, an international relations expert at Renmin University, agreed that China was unlikely to create a zone in the South China Sea anytime soon, mainly because Beijing does not see the same urgency, but he said that could change if “confrontations in the South China Sea escalate”.
China and Japan had for decades put the Senkaku dispute to the side.
But Beijing reacted angrily last year when Japan bought three of the islands from their private owner, in a move that sparked anti-Japan protests across China.
Mr Li said China probably decided to create an ADIZ – which other countries such as Japan and the US did long ago – because Tokyo has routinely pointed to the number of Chinese incursions into Japan’s zone as a way to rally public support.
“That caused the Chinese side to say we need to get one too. There is a huge PR war here,” said Mr Li.

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China's Latest Territorial Moves Renew Fears In Philippines

by FRANK LANGFITT

U.S. and Philippine navy personnel patrol the seas off a naval base west of Manila in June as part of joint exercises.

China is flexing its muscles these days. 

Over the weekend, it declared a sprawling air defense identification zone that covers disputed islands controlled by Japan. 

And it has sent its lone aircraft carrier for first-time trials in the South China Sea, where Beijing has territorial feuds with other neighbors, including Vietnam, Brunei and the Philippines.
None of this was making China any friends in Manila, where the Chinese government is particularly unpopular these days.
"It only tends to confirm and reinforce the fears and worries of many people in the region," says Jay Batongbacal, a University of the Philippines law professor, who has spent a decade and a half studying territorial disputes in the South China Sea. 

"Right now, I think they are seen more as a bully, because of the actions that they've taken."
Among those actions was last year's takeover of a disputed and potentially strategic shoal in the South China Sea that had been under Philippine control.
It started when Philippine authorities tried to arrest Chinese they accused of illegally fishing inside the shoal, which is really a shallow, triangle-shaped reef with a small opening at one end. 

China sent marine surveillance ships to block action by a Philippine navy frigate.
"One of the measures that they put in place was to string a line across the mouth of that entrance," says Batongbacal, "because if any vessel tries to cross that line, it will get entangled in the propellers."
The Chinese effectively sealed off the reef from Philippine fishermen and took control of Scarborough Shoal without firing a shot.
The shoal, rich in fish, is about 140 miles from the Philippine mainland and more than 500 miles from China. At high tide, only five rocks stick up out of the water, but Philippine officials worry China might one day declare them Chinese territory.
Batongbacal says in the worst-case scenario — from the Philippine perspective — China could turn the shoal into a safe harbor for Chinese government vessels and a way to extend its influence and power in the region.
"Right now, it's clear that their motivation is that they want to vindicate their claim to the entire South China Sea," Batongbacal says.
A huge amount of trade and oil passes through the South China Sea, which China has claimed since the 1940s. Back then, though, it was militarily too weak to do anything about it. 

Today, China is the world's No. 2 economy and a rapidly rising military power.
Dindo Manhit, president of Stratbase Research Institute, a strategic think tank in Manila, says China now wants to ensure it has a major say in what happens in the South China Sea. 

Like all economic powers, Manhit says, China wants to spread its influence.
"At the end of the day, any economic influence needs to be protected by either strong military or political influence," Manhit says. 

"I think that's where it's coming from."
Chito Santa Romana, who spent nearly four decades living in China where he served as the bureau chief for ABC News, thinks it also comes from a desire to restore China, which means "Middle Kingdom" in Mandarin, to what it sees as its rightful place as a respected global player.
"I would attribute it to what I call the resurgence of the 'Middle Kingdom Complex,' " says Santa Romana, who works in Manila with a think tank, trying to forge understanding on the South China Sea dispute between the two countries. 

"The 'China Dream' that the Chinese talk about, they want to recover the glory that was lost when they were a pre-eminent power."
The U.S. has dominated East Asia militarily for decades, ensuring the peace and security that allowed the region's economies to grow so rapidly. 

The Philippines hopes America will back it up if its dispute with China turns violent, but some worry Washington's deep and complex ties with Beijing will win out in the end.
"We just hope and expect that the U.S. remembers us really as the true ally here," says Manhit, "because some people are saying that in a conflict between China and the Philippines, the U.S. will choose China because of the economic relationship."
Jay Batongbacal, the University of the Philippines law professor, says turning its back on a longtime ally with whom it has a mutual defense treaty would have serious implications for America and its other diplomatic relationships. 

Most people in the Philippines are hoping it never comes to that.

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Cultural revolution taking place in China's bedrooms

By Neil Connor

Visitors look at sex toys displayed at the Guangzhou Sex Culture Festival. 

In a photo taken on Nov 9, 2013, visitors take photos of a model (R) at the Guangzhou Sex Culture Festival in the southern Chinese city of Guangzhou. 

Japanese adult video actress Mizuna-Rei applies makeup on November 9, 2013, before making an appearance during the Guangzhou Sex Culture Festival in the southern Chinese city of Guangzhou
A Japanese porn star prepares for a performance in her dressing room, unruffled by furious arguments outside among impatient Chinese fans eagerly anticipating her show.
Rei Mizuna was in China to corner her share of its money-spinning sex product market.
"Everyone is so passionate and I'm really happy," the diminutive porn star told AFP as heated exchanges took place outside.
"I really didn't think there would be this much excitement."
The rowdy scene at the Guangzhou National Sex Culture Festival was a graphic illustration of how sexual taboos are loosening in the once deeply conservative country -- and the opportunities for those able to exploit it.
China is estimated to make more than 80 percent of the world's sex toys, with one million people employed in the industry, but an increasing proportion of the products are staying in the country to feed domestic demand.
An adventurous generation of young, mainly urban Chinese are pushing back the frontiers of what is accepted, adopting attitudes far removed from the puritan days of radical Communist rule their parents lived under.
Pornographic videos are banned in China, but softer varieties and the wider sex product industry is booming.
At the fair earlier this month hundreds of sex doll makers, condom companies and vibrator distributors vied for the attention of hundreds of thousands of visitors.
At one end of the giant exhibition hall, a transsexual model performed an outlandishly lewd act with a vibrator, occasionally departing from the stage to meet the audience.
Elsewhere electronic gadgets emitted shrieks of sexual rapture while younger men barged their way through tiny, crowded booths, sifting through rows of outfits for nurses, French maids and policewomen, and huge bins full of ladies briefs as if seeking out ripe apples at a fruit market.
Sexual inhibitions are left at the door of the annual event, along with sexual partners for all but a few of the largely male visitors.
"We just came here to have a look around," said one young man, clutching bags of women's clothes, small tubs of cream and a huge supply of free condoms.
He was among a hundreds-strong crush of people who waited for more than three hours to see Mizuna take the stage, handing out condoms and letting one lucky admirer peck her on the cheek.
Japanese porn stars -- who are known as AV (Adult Video) Girls in Asia -- routinely perform song and dance routines in China in a bid to sell their softer videos and raise their profiles as mainstream entertainers.
They are wildly popular among Chinese men, particularly on China's microblogging websites.
AV Girl Sora Aoi has almost 15 million followers on Sina Weibo, China's version of Twitter.
More than 2,000 sex shops have been set up in each of Beijing and Shanghai since laws were relaxed in 1993, according to state-run media, and the market for sex toys is growing at 63 percent a year.
"Our industry has changed a lot," said Cheng Zichuan, owner of Hitdoll, one of China's top sex doll manufacturers.
Consumer attitudes had developed dramatically since the company was set up six years ago, he added, sitting in the back seat of a speedboat next to a 38,000 yuan (US$6,200) flame-haired sex doll called Lydia, which has technologically advanced hands.
"They all thought these products were too expensive and there was no place to buy them, and they would feel disgraced if the family saw the dolls," he told AFP.
"Now they don't mind, they buy the dolls if they like them and enjoy it," he said, adding that he sold up to five a month, mainly to rich single men who do not want to "randomly hire prostitutes" and lonely widowers -- who often buy dolls custom-made to resemble their late wives.
Recent studies show the Chinese are not only becoming more adventurous in the bedroom, but are also more willing to have sex before they make firm relationship commitments.
More than 70 percent claimed to have had pre-marital sex in a report last year by a prominent Chinese sexologist, a huge leap from 40 percent in 1994 and 15 percent in 1989.
But the legal framework surrounding sex has yet to adapt to changing social mores.
China's minimum age for marriage stands at 22 for men and 20 for women -- the highest in the world.
Guangzhou Daming United Rubber Products, one of China's largest condom makers, hopes to profit from huge growth predicted for the domestic contraception market, and director Victor Chan said the younger generation was adopting "a more westernised culture".
But there are strict laws restricting condom advertising and officially China remains "quite conservative", he added, to the sound of electronically-generated howls of ecstasy.

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Enforcing rules in air zone will stretch China's air force and navy

BY GREG TORODE AND ADAM ROSE

China's military could struggle to cope with the demands for intensified surveillance and interception if it tries to enforce the rules in its new air defense zone over islands at the heart of a territorial dispute with Japan.
Regional military analysts and diplomats said China's network of air defense radars, surveillance planes and fighter jets would be stretched by extensive patrols across its Air Defense Identification Zone, roughly two-thirds the size of Britain.
But some noted that even limited action could still spark alarm across a nervous region -- and serve China's desire to pressure Japan.
China published the coordinates of its zone in the East China Sea over the weekend and warned it would take "defensive emergency measures" against aircraft that failed to identify themselves properly in the airspace.
It is already being tested.
Two unarmed U.S. B-52 bombers on a training mission flew over the disputed islands on Monday without informing Beijing while Japan's main commercial airlines ignored the rules when their planes passed through the airspace on Wednesday.
China's Defense Ministry said it had monitored the entire progress of the U.S. bombers. 

The Pentagon said the planes had neither been observed nor contacted by Chinese aircraft.
A Japanese government source said China's military, while growing rapidly after many years of double-digit budget increases, still did not have the radars or fighters to cover a zone of such size across international airspace.
"China will not implement (the zone) fully because they do not have enough assets ... but they will try to scare smaller nations," said the source, who declined to be identified because he was not authorized to speak to the media on the topic.
While China could field an extensive array of surveillance capabilities, including ship-borne radar, there will still be gaps, added Christian Le Miere, an East Asia military specialist at the independent International Institute of Strategic Studies in London.
"It is just not yet clear how they are going to enforce it," he said. 

"It may be more a rhetorical position to serve a political end."

NOT A NO-FLY ZONE
China's creation of the zone triggered a storm of criticism from Washington and Tokyo, with both countries accusing Beijing of trying to change the status quo in the region.
Some experts have said the move was aimed at chipping away at Tokyo's claim to administrative control over the area, including the tiny uninhabited islands known as the Senkakus.
Japan and the United States have their own air defense zones but only require aircraft to file flight plans and identify themselves if those planes intend to pass through national airspace.
Gary Li, a Beijing-based senior analyst with the consulting group IHS Aerospace, Defense and Maritime, said he did not believe China would try to replicate in the air what it had done at sea by keeping a rotating presence of coastguard ships on standby near the islands.
"I think it will be more a case of China flying enough to make a point -- it is quite a strain on any force to maintain some kind of 24-hour presence in the air," he said.
"It must be remembered that this is not a no-fly zone -- China doesn't have to operate extensive patrols to make its presence felt."
Patrol ships from China and Japan have been shadowing each other near the islets on and off for months, raising fears that a confrontation could develop into a clash.
There have also been several incidents involving military aircraft flying close to each other. 

In October, Chinese military aircraft flew near Japan three days in a row, and Japan scrambled fighter jets each time in response.
While China had significantly improved the quality and number of surveillance aircraft operated by its navy and air force over the last decade, Li said he believed coastal air defense radars would be used for routine coverage of the new zone.
Planes -- whether surveillance or fighter jets -- would be used generally for more specific tasks, he said.
Indeed, attention is likely to focus on airfields and coastal radar stations around Shanghai -- strategically placed near the top of the zone.
Independent academic and commercial analysis of China's air force and naval aviation deployments shows a concentration of surveillance aircraft, together with expanding fleets of indigenous J-10 and Russian-acquired Su-30 jet fighters.
An estimated 45 surveillance planes are also within range of the zone, along with as many as 160 fighters around Shanghai -- including some ageing locally produced J-7 aircraft.
Most of the surveillance planes are variants of the long-range, locally manufactured Y-8, equipped for separate tasks, such as early-warning patrols, electronic intelligence gathering as well as ship and submarine surveillance.
Particular regional attention is focused on four larger KJ-2000 Airborne Warning and Control System aircraft, converted Russian Il-76 planes, based out of Jiangsu province, neighboring Shanghai, and within reach of Japan and Taiwan.
"We don't think China's AWACS planes and their abilities are up to the standard of the U.S. and its allies," one Asian military attache in Hong Kong said. 

"But we can be sure they are getting there -- and any extensive enforcement operation could bring them into full play -- so we are watching them closely."

NO "HOT DOGGING"
The potential behavior of Chinese pilots during any intensified campaign is also drawing scrutiny -- with U.S. officials particularly worried about the risk of miscalculations or accidents.
The days of Chinese fighter pilots buzzing U.S. surveillance planes largely ended when one died in a collision with a U.S. aircraft in 2001.
U.S. military pilots say their Chinese counterparts have generally stopped any fast and loose maneuvers during routine intercepts after the fatal collision above the South China Sea sparked a crisis in Sino-U.S. ties.
"You just don't see the hot-dogging you used to see up there," one pilot said. 

"As China's got a lot more assets, its pilots have gotten a lot more professional."
While insisting the zone would be here to stay, Chinese officials and military officers have insisted that Beijing fully intended to comply with international law.
Senior naval advisor, Rear Admiral Yin Zhuo, told state broadcaster CCTV that it was illegal to shoot down planes in international airspace.
"Once you enter our territorial airspace we can shoot you down," he said. 

"But beforehand I would have warned you: if you don't report and enter our territorial airspace, we would take drastic measures."
A Defense Ministry spokesman would not confirm to Reuters whether China's interception aircraft would be armed as they patrolled the zone, however.
"For unidentified or threatening flying objects in the (zone), the Chinese side will, according to different situations, take timely identification, surveillance ... and control measures to deal with it," the spokesman said.
"We hope that relevant parties give proactive co-operation to jointly maintain flying safety."

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China has thrown down a gauntlet to America

Beijing has turned control of the air space around the Senkaku islands into a test of the US

By Philip Stephens

At first glance, Beijing’s designation of an air defence zone in the East China Sea marks a calibrated escalation of its longstanding dispute with Japan about sovereignty of the Senkaku islands. 

A more worrying, and plausible, interpretation is that Beijing has decided to square up to the US in the western Pacific. 

East Asia is looking an ever more dangerous place.
When Xi Jinping met Barack Obama in California this year, the Chinese president told his US counterpart the Pacific Ocean was large enough to accommodate two great powers. 

The inference was that the US and China should divide the spoils. 

Also implicit in the remark, though, was that China would not accept a status quo that saw the US remain the Pacific’s pre-eminent power. 

At the summit, Mr Obama sidestepped the issue. 

Now it seems Mr Xi has decided it is time for China to start grabbing its share.
The Senkaku have been administered by Japan since the late 19th century, apart from a spell of US control after the second world war. 

China staked a claim during the early 1970s, but for decades did little to press its case. 

Since the 2008 Olympics, Beijing has adopted a more assertive approach, making regular incursions into the disputed territory’s sea and air space. 

This has prompted a US warning that the area is covered by the US-Japan mutual security pact.
This US commitment is now being tested. 

The question Beijing seems to be asking is how far will Mr Obama go to uphold the existing order. 

China’s strategic objective is to push the US away from its coastline and establish its suzerainty in the East and South China seas. 

Does an America exhausted by wars in the Middle East have the political will to risk conflict in Asia in order to defend a few uninhabited rocks? 

It was probably no accident that Beijing’s timing coincided with one of the most troubled periods of Mr Obama’s presidency.
Washington’s decision to send two B52 bombers into the newly designated “air defence identification zone” – flouting Beijing’s demands to be notified of flights and thereby risking “emergency defensive action” – suggests it understands the nature of the challenge.
Chuck Hagel, the US defence secretary, called the Chinese move “a destabilising attempt to alter the status quo in the region”. 

Other US officials were less diplomatic. 

Beijing, though, is playing a long game. 

The $64,000 dollar question in east Asia is whether the US has the staying power to resist a sustained Chinese push for regional hegemony.
The immediate impact of Beijing’s new flight rules is to heighten the already significant risk of an armed clash with Japan over the islands. 

The Chinese zone overlaps with Toyko’s long-established ADIZ. 

The danger of miscalculation on both sides is far from negligible. 

In Shinzo Abe, Japan has a nationalist prime minister determined not to be cowed by his country’s more powerful neighbour – nor to be over-influenced by private US warnings that Tokyo should play its part in lowering the political temperature.
Mr Abe is looking for an excuse to amend Japan’s constitution to provide it with something more than a defensive military capability. 

A clash, accidental or intended, with China around the Senkaku would provide just such a justification.
This leaves Mr Obama in a distinctly uncomfortable position. 

The US has to make clear to China that it stands behind Japan in the dispute, but at the same time it wants to avoid giving encouragement to Mr Abe to ratchet up tensions in the region. 

Each and every one of China’s neighbours is watching closely to see precisely where Washington strikes the balance between these two objectives.
For the US there is much more at stake than its relationship with Japan. 

Beijing’s stand-off with Tokyo over the Senkaku is one of many territorial disputes between China and its neighbours. 

The new airspace restrictions overlap with the South Korean zone as well as with Japan’s territorial claims. The Philippines is unhappy with Washington for what it sees as a US failure to give it sufficient support in its dispute with Beijing over a group of islands in the South China Sea. 

Vietnam has a separate quarrel with China over its maritime borders.
Consciously or otherwise, Beijing has now turned control of the air space around the Senkaku into a litmus test of the US security commitment to east Asia. 

For Washington to accept the Chinese restrictions would be to send a signal to every other nation in the region that the US cannot be relied on to defend the status quo against Chinese expansionism.
Yet to demonstrate its resolve as a resident east Asian power by constantly patrolling the disputed air space is to accept a new source of friction with Beijing. 

My guess is that Mr Obama, accused of presiding over a collapse of US power in the Middle East, cannot afford to back down over the Senkaku.
Chinese policy makers are nothing if not assiduous students of history. 

The rise of Germany at the end of the 19th century has long featured prominently in the curriculum of Beijing’s foreign policy elite. 

China, these officials tell visitors, will not repeat the Kaiser’s miscalculation in uniting Germany’s neighbours in opposition to its rise to great power status. 

This attentiveness to the past now seems to be taking second place to China’s determination to assert its power. 

History’s mistakes are often repeated.

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Spying beyond the façade

By Geoff Wade

The almost-eternal profession of covert intelligence collection and analysis (a.k.a. spying) has been much in the news of late, with the US National Security Agency and Australia’s own Signals Directorate sharing headlines across the region and indeed the globe. 

But it’s not just Australia and the United States that have had their covert activities brought to public attention. 

China’s covert operatives (in this case HUMINT rather than SIGINT) have also been the subject of some unsought attention through the publication of a recent detailed study (PDF) of the General Political Department (GPD) of the PRC’s People’s Liberation Army (PLA) by the Project 2049 Institute in Virginia.
Authors Mark Stokes and Russell Hsiao used primarily open-source material to detail the history and current activities of the political wing of the PRC military. 

‘Political warfare’ has been an intrinsic part of Chinese military strategy under both the Guomindang and the Communist Party of China. 

It was long domestically oriented, but of late, with the growing global engagement of China, the activities of the GPD’s Liaison Department (LD) have become increasingly international. 

Stokes and Hsiao see political warfare as ‘active measures to promote the rise of China within a new international order and defend against perceived threats to state security,’ with these functions augmenting traditional state diplomacy and formal military-to-military relations.
The LD can certainly be considered to be an integral element of the Chinese intelligence community. 

But its functions are broader as it develops links with global elites and aims at influencing the policies and behaviour of countries, institutions and groups beyond China. 

It engages in a broad range of activities including propaganda, liaison, influence peddling, information gathering and perception management. 

And LD members are sometimes posted to Chinese embassies. 

In brief, its tasks involve much greater calculated manipulation than does usual soft power.
To pursue its tasks, the LD has created a range of front organisations, the most prominent of which for international activities is the China Association for International Friendly Contact (CAIFC). 

The CAIFC, defines itself on its website as ‘a social organisation devoted to fostering international and regional people-to-people friendly exchanges,’ which completely obscures its connections with the People’s Liberation Army and the Central Military Commission. 

It organises visits and activities to which elite members of international society are invited. 

For example, the First China Philanthropy Forum in November 2012 was attended by Bill Gates, Tony Blair, and Western Australian Governor Malcolm McCusker, along with ‘40 other consultants and directors of the CAIFC’. 

John Howard also attended, and was feted by Cheng Siwei 成思危, chairman of the China Foundation for International Strategic Studies, an organisation which is likewise intimately tied to the PLA. 

Just this month the CAIFC reportedly invited Aung San Suu Kyi to visit China, an invitation which has been denied by the Chinese Foreign Ministry, suggesting perhaps some difference between the PLA and the foreign ministry.
The current CAIFC President is former PRC foreign minister Li Zhaoxing, who melds the CAIFC activities with more formal foreign affairs organisations such as the recently-established China Public Diplomacy Association, which he also heads. 

Together with Kevin Rudd, Li opened the inaugural Australia–China Forum in Canberra in November 2011. 

One of the long-term CAIFC vice presidents is Deng Rong, daughter of Deng Xiaoping, but it’s the other vice presidents who have now become the centres of attention.
In their CAIFC roles, the PLA’s major operatives within the organisation necessarily adopt alternate identities. 

The Stokes and Hsiao study illuminates the types of identities behind which the activities of the Liaison Department are pursued. 

Key operatives include Xing Yunming 邢运明, the executive vice president of the CAIFC, noted on their website as a bureaucrat who had served in Nanjing and the Ministry of Civil Affairs. 

But the study reveals that Major General Xing has also been the Director of the Liaison Department of the General Political Department of the PLA since 2007. 

Xing hosted Tony Blair on his visit to China in June this year. 

In 2012, Andrew Forrest of the Fortescue Metals Group, Christopher Barnard of the Macquarie Group and Owen Hegarty of OZ Minerals were also photographed with Xing, while Forrest met again with Deng Rong earlier this year. 

John Garnaut has highlighted the efforts by CAIFC to target Australian business leaders.
Also of interest is Li Xiaohua 李晓华, listed on the CAIFC website alongside Deng Rong as a vice president of the association, and described as an economist who has worked with the Guangdong Economic and Trade Commission and the State Planning Commission. 

We now find that Mr Li is also a Major General in the PLA and a deputy director of the GPD Liaison Department. 

Major General Li also regularly meets and fetes senior visitors from around the region in his CAIFC capacity.
Another CAIFC VP is Chen Zuming 陈祖明, a Russian language specialist who previously served in the Shandong foreign trade department. 

He’s known in the PLA as Major General Chen Zuming, and led the Liaison Department prior to Xing Yunming. 

He appears to concentrate on links with Russian and Eastern European countries. 

Lastly, Xin Qi 辛旗, yet another VP, is an academic who has been involved in cultural and publishing endeavours. 

PRC military websites however record him as Major General Xin Qi, a deputy director of the Liaison Department.
This intense engagement by senior members of the PLA in CAIFC activities clearly shows the degree to which it is a covert arm of the PLA, engaged in intelligence and propaganda work.
While this exposé of a PLA front organisation isn’t going to garner the acres of headlines nor induce the reactions which we saw with the NSA and ASD revelations, it does provide a little insight into the workings of a nation with which Australia is increasingly engaged. 

In the murky world of covert operations, a little insight is the most that we can hope for.

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