bei jing

BEIJING: Ten million energy-saving lamps will be distributed on the streets of Beijing starting Monday in one of the largest ever energy conversion exercises of its kind.

With soaring power costs in China, the government estimates replacing incandescent lamps with energy-saving alternatives could save $35 million a year in electricity bills, said the Beijing Municipal Commission of Development and Reform on Saturday.

Over the next two months, its officers will trawl Beijing’s streets making their case to the city’s residents.

The government has struggled to encourage residents in cities to swap incandescent bulbs for greener alternatives given the relatively higher costs of energy-efficient lamps. But this initiative will make the lamps available for sale at a much-reduced price of just 1 Yuan (Rs. 7) — 10 per cent of the market price.

The energy conversion programme is part of the Chinese government’s plan to distribute 100 million energy-friendly light bulbs in cities across China this year. The programme is partly funded by China’s massive $586 billion stimulus package, which allocated $30 billion exclusively for green energy projects.

Achieving a significant reduction in electricity consumption in urban households is crucial for China to reach its ambitious target of producing one-fifth of all its energy needs from renewable energy by 2020. Lighting accounts for 19 per cent of the country’s energy needs, according to the Joint U.S.-China Cooperation on Clean Energy (JUCCCE), a non-profit organisation that is working to promote clean energy and energy efficiency in China.

The organisation estimates that 10 million energy-saving lamps will eliminate the need for ten 50-megawatt coal-fired plants and save about 3.7 million tonnes of carbon dioxide over four and half years. Improving energy efficiency has become a priority for the Chinese government. In spite of huge investments in renewable energy, coal consumption in China still grew by 7 per cent last year, even as prices rose, and accounted for 43 per cent of global coal consumption.

The government envisages the energy conversion programme as one important way of controlling consumption in cities. The local government in Beijing began a “green lighting” project in 2004. Since then, around 3 million energy-efficient lamps have been installed in public service buildings, mainly government offices, schools and hospitals.

Large-scale operation

But this project will for the first time bring energy-efficient lamps to Chinese households on such a large scale.

The JUCCCE is leading a similar campaign in Shanghai, where the organisation, working with the Shanghai municipal government, is distributing 10 million energy-saving lamps free of cost to the city’s residents. Starting in April 2008, the Chinese government introduced subsidies on energy-efficient light bulbs of 30 per cent on wholesale and 50 per cent on retail purchases.

According to a recent report by the Centre for American Progress, an estimated 62 million bulbs had been subsidised by January 2009, saving an estimated 3.2 billion kilowatt hours of electricity annually, or roughly 5 per cent of the annual energy consumption of a city like Beijing.

Chinese President Hu Jintao arrived in Beijing Sunday morning after attending the annual summit of the Shanghai Cooperation Organization (SCO) and the first meeting of BRICs (Brazil, Russia, India and China) leaders in Russia’s Ural city of Yekaterinburg.

He also paid state visits to Russia, Slovakia and Croatia from June 18 to June 20.

BEIJING — Timothy F. Geithner, the U.S. Treasury secretary, said Monday that the global financial crisis seemed to be easing, but that the United States and China would have to work together to stabilize and rebalance the world economy.

In a speech at Peking University, Mr. Geithner encouraged China to diversify its economy away from a heavy reliance on exports while offering Beijing assurances that Washington intended to tackle its deficit and protect the value of China’s huge investment in United States government debt.

“We will cut our deficit, and we will eliminate the extraordinary government support that we have put in place to overcome the crisis,” Mr. Geithner told a gathering of students and faculty at the university.

This is Mr. Geithner’s first visit to Beijing since becoming Treasury secretary, and on Tuesday he is scheduled to meet with President Hu Jintao and Prime Minister Wen Jiabao, as well as other high-ranking officials.

Under the pressures of the global economic downturn, relations between the United States and China are undergoing some fundamental changes. China is growing more assertive on the international stage, and Washington is seeking to find ways to cooperate with Beijing on everything from economic reforms to climate change.

China is the largest holder of United States government debt, and a growing number of Chinese officials and economists have expressed concern in recent months that the value of those debt holdings will plunge if inflation takes off or the dollar weakens further because of mounting U.S. deficits.

In fact, interest rates on United States Treasury notes have been rising lately, cutting their value by just over 5 percent.

Some Chinese economists are pressing Beijing to slow its accumulation of Treasury bills and others are even pushing for the creation of an alternative reserve currency as a hedge against the U.S. dollar.

Following Mr. Geithner’s speech Monday, a student asked the Treasury secretary whether China’s investments in the United States were safe.

He responded without hesitation. “Chinese financial assets are very safe,” Mr. Geithner said, eliciting some laughter. He then quickly said that the United States still has deep and liquid financial markets, and that the Obama administration is committed to tackling the deficit and maintaining a strong dollar.

In his speech, Mr. Geithner encouraged Beijing to work with Washington to create more balanced, sustainable growth for the nations’ economies.

“China and the United States individually and together are so important in the global economy and financial system that what we do has a direct impact on the stability and strength of the international economic system,” he said.

A rebalanced global economy would likely mean that the United States would save more and consume less, he said, and that China would encourage its own consumers to spend more and save less.

Mr. Geitchner touched on currency issues just briefly. Some economists have long argued that China keeps its currency intentionally weak in order to make exports to the United States cheaper, and the U.S. Treasury secretary did urge China to move toward a more flexible exchange rate. But he did not put much emphasis on the point.

Currency debates and trade frictions had flared between the United States and China during the administration of President George W. Bush, even though relations were solid overall. For now, the Obama administration seems determined to avoid tensions and to search for ways to cooperate with China.

Under Mr. Bush, Treasury Secretary Henry M. Paulson Jr. held regular meetings with officials in Beijing as part of the so-called the strategic economic dialogue.

The Obama administration has decided to broaden those discussions, with Secretary of State Hillary Rodham Clinton taking part, in what is now being called the strategic and economic dialogue.

Mr. Geithner said that he would begin to discuss some of the pressing economic issues this week in Beijing, where he has been given a warm welcome. At Peking University, the school recognized his family’s contributions to China, calling the Geithners “friends of China.”

Mr. Geithner’s father, Peter F. Geithner, was the director of the Asia program of the Ford Foundation in the 1980s and opened its Beijing office. Under his leadership, in the 1980s and 1990s, the foundation offered support for many Chinese scholars to travel to the United States to study.

Mr. Geithner was also greeted at Peking University as an alumnus because he studied Chinese at the school in the summer of 1981, while he was a 19-year-old undergraduate at Dartmouth College.

China has held off on ordaining bishops without Vatican approval, but government interference in the state-backed Chinese church is still a concern, Hong Kong’s cardinal — a key adviser to the pope— said Monday.

Beijing and the Vatican don’t have diplomatic relations, and the power to appoint bishops is a major sticking point between them.

China forced its Roman Catholics to cut ties with the Vatican in 1951, shortly after the officially atheist Communist Party took power. Worship is allowed only in state-backed churches, which recognize the pope as a spiritual leader. They name their own priests and bishops, but the Vatican has made efforts in recent years to recognize them.

HONG KONG — It was a raucous display of free speech outside Hong Kong’s Legislative Council last week: construction workers demanding increased spending on public works, retirees agitating for heftier pensions, and legislators, wearing black T-shirts printed with tanks, calling on the Beijing government to apologize for the bloodshed in Tiananmen Square two decades ago.

In the 12 years since it passed from British to Chinese rule, Hong Kong has remained a bastion of civil liberties unknown in mainland China, under an arrangement dubbed “one country, two systems.”

The result has been the continuation of a freewheeling press, an independent judiciary and a well-oiled bureaucracy. On Thursday, tens of thousands are expected to turn out for a candlelight vigil in Victoria Park here to commemorate the 1989 Tiananmen crackdown, in which hundreds of students advocating democracy were killed. In the rest of China, any mention of the events at Tiananmen Square has been banned in the news media or public discourse.

But many democracy advocates and civil libertarians here are increasingly anxious about whether laissez-faire Hong Kong can maintain its independence from Beijing’s authoritarian grip and its distinct identity as an amalgam of Western and Chinese sensibilities.

Last year, Beijing postponed direct elections — to 2017 for the chief executive and 2020 for the full legislature — and its critics say China is wielding a heavier hand in Hong Kong’s affairs.

A growing roster of overseas visitors whose politics irritate Beijing have been denied entry to Hong Kong, and pro-China legislators have blocked efforts to include an uncensored account of Tiananmen Square in high school textbooks.

Longtime advocates of democracy like Martin Lee warn that China is chipping away at Hong Kong’s autonomy by fiat or by co-opting business leaders and politicians.

On Saturday, Mr. Lee, the founder of Hong Kong’s Democratic Party, disclosed that he had been the target of an assassination plot that he said the authorities foiled last August. He said the men were arrested not long after he wrote an editorial accusing China of failing to live up to its pledge to improve human rights.

“If you throw a frog into boiling water, it will jump out right away,” Mr. Lee said during an interview in his office overlooking the High Court. “But if you put the frog in warm water and cook it slowly, it doesn’t jump. We are being slowly cooked in Hong Kong, but hardly anyone is noticing.”

Mr. Lee and other democracy advocates have worried for years about Beijing’s expanding influence here. But in advance of the 20th anniversary of Tiananmen — and of the July 1anniversary of Hong Kong’s return to China in 1997 — they are concerned about a new willingness by public officials to openly back the mainland’s view. They say that is a jarring development in a city where a million people took to the streets in the summer of 1989 and where protests have been held every June 4 since then.

When asked two weeks ago if he supported exonerating the students who occupied Tiananmen Square, Hong Kong’s chief executive, Donald Tsang, told legislators that the episode was best forgotten. “This is something that happened a long time ago,” he said. “The national economy has grown and brought prosperity to Hong Kong.” He added that he thought his view “represents the opinion of Hong Kong people in general.”

Other local officials aligned with Beijing have gone further, claiming that no one died during the crackdown, or that an armed response was warranted because student leaders were planning to kill government soldiers. And in April, Ayo Chan, the president of Hong Kong University’s student union, obliquely blamed the protesters for provoking the violence in Tiananmen.

Such statements do not go unchallenged, however. Angry students promptly voted Mr. Chan out of office, and Hong Kong’s chief executive was forced to apologize. A poll by Hong Kong University last week suggested that public sympathy for the Tiananmen protesters was high, with nearly 70 percent of Hong Kong residents saying the Chinese government had erred in its handling of the demonstrations.

But those who closely watch the political culture here say reunification with China has begun to slowly alter Hong Kong’s unique ethos, even if the changes are hard to quantify and support for democracy is still strong. Numbers tell part of the story: a decline in the number of Western expatriates coinciding with a growing presence of mainlanders.

Last year, nearly 17 million mainland Chinese visited Hong Kong, compared with just over 2 million in 1997. Shifting demographics have had an even greater impact on local universities. More than half the postgraduate students studying here are from the mainland, up from barely one-third in 2003.

Like many other entrepreneurs here, Ronnie Chan, a billionaire whose company, Hang Lung Properties, has expanded into the mainland, argues that Hong Kong can flourish only through closer ties to China. In an interview last week, he said Hong Kong was far freer today than it ever was under the British. If anything, he said, society could use a bit more restraint, especially when it comes to the media. “People were afraid the media would be curbed, but it’s gone wild and become irresponsible,” said Mr. Chan, 59, who attended college and graduate school in the United States.

Groups like the Hong Kong Journalists Association take a different view, saying the number of media outlets willing to take on topics that might anger Beijing has been shrinking. Mak Yin-ting, a freelance journalist and former chairwoman of the association, said the owners of more than half of Hong Kong’s media outlets — many of whose owners have business interests in China — have been given advisory posts to the National People’s Congress and People’s Political Consultative Conference, which rubber-stamp decisions made by the Communist Party.

The result, Ms. Mak said, is that some reporters engage in self-censorship, while editors sometimes bury stories that might be unflattering to Beijing. “When your boss is a delegate to the National People’s Congress,” she said, “then you know it’s better not to criticize China too loudly.”

PETALING JAYA: One year spent in the Middle Kingdom is no guarantee to fluency in Mandarin, as Prof Dr Awang Sariyan, the first holder of the Chair of Malay Studies at Beijing Foreign Studies University (BFSU), can attest to.

He has not improved on his Mandarin despite having been in Beijing for more than a year.

This is because Prof Awang speaks Malay most of the time.

“My interaction with colleagues and students in the Malay language programme is mainly in Malay. That reduces my chances of speaking in Mandarin, except when I shop for groceries,” he said.

Prof Awang appreciates the modern and traditional mix in Beijing.

“Food is not a problem either because of the large number of Muslim restaurants, as well as the availability of halal meat and chicken.”

He was appointed to the chair at BFSU in January last year. As language director of the Dewan Bahasa dan Pustaka, he was involved in the Chair’s establishment and helped to prepare its concept paper.

Prof Awang has been extremely busy since taking up his appointment. Malay Studies is not new to BFSU – the language has been taught there since 1961, but Prof Awang has introduced several new subjects.

His duties also include helping other Chinese institutions strengthen their Malay language programmes, namely Peking University, Commu-nication University of China, Guangxi University for Nationalities and Guangdong University for Foreign Studies.

Prof Awang is currently busy with an international conference on Malay Studies being held in BFSU in conjunction with the 35th anniversary of diplomatic ties between Malaysia and China. The conference ends on Wednesday.

There are three other chairs of Malay Studies – at Victoria University of Wellington in New Zealand, Leiden University in the Netherlands and the University of Ohio in the United States.

One more is set to be established at South Korea’s Hankuk University.

SINGAPORE — PetroChina’s US$2.2-billion bid to buy half a refinery in Singapore may look like yet another China deal for energy security, but really it says far more about Beijing’s desire to flex its pricing muscle on world markets.

The clearly established pattern that precedes this weekend’s deal isn’t the headline-grabbing “go out” strategy that has state oil and metals firms hunting furiously for oilfields and mines abroad, but the more low-key plan for those companies to become more potent and influential traders on global markets.

With its landmark deal to buy Singapore Petroleum Company (SPC), which owns a 30 year-old, 285,000 barrel per day (bpd) refinery, PetroChina adds the final piece of its trading arsenal: a major source of fuel supply in the trading hub where most of Asia’s oil prices are determined.

“They already have a fairly big presence in Singapore in terms of trading, and now they have also gained actual fuel production, so it’s really further integrating into the value chain,” said Victor Shum of Purvin & Gertz in Singapore.

PetroChina’s aims have been expressed most clearly by the growth of its trading subsidiary Chinaoil, which since 2005 has nearly trebled its Singapore-based trading team to 14, doubled its fuel trading volumes and is a regular participant in the daily half-hour trading “window” that sets benchmark prices.

It already has two other key ingredients for success: long-term deals to supply fuel to top regional importers Indonesia and Vietnam; and a 35% stake in newly built oil storage enterprise Universal Terminal.

All told, it will have enormous leverage to trade in the spot Singapore oil market, where even a small volume of deals can have significant implications for contract prices.

Although it won’t change the course of benchmark U.S. crude prices overnight, the deal is the latest manifestation of China’s desire to use its leverage as a top consumer of industrial resources to become a price-maker, not a passive price-taker.

Its steel mills are now leading global negotiations for term iron ore contracts, and various government entities have been aggressively stockpiling metals to prop up domestic prices.

For PetroChina, Asia’s top oil and gas producer, the deal also realises a long-held ambition to expand downstream.

It is due to finalise a deal by July 1 to buy a 49% stake in Nippon Oil’s 115,000-bpd Osaka refinery, building on long-term cooperation, and last year Singapore media said it was looking at building a greenfield refinery in the city-state.

It now trades around 20 million tonnes of fuel a year through its team in the Singapore oil hub, double what it did in 2005, more than half of it residual fuel oil.

Its share of SRC’s output, which will include 0.001% sulphur diesel when a revamp programme is completed by September, will allow Chinaoil to participate in the Europe arbitrage trade, adding a new dimension to its big regional book, traders say.

Chinaoil will also have access to SPC’s 220,000 cubic-metre storage terminal at Pulau Sebarok off Singapore’s west coast.

SPC owns half of Singapore Refining Company (SRC), with the remainder held by U.S. major Chevron Corp

PetroChina said the deal was a “new platform for the implementation of our international strategy” — without going into further detail about which strategy it was referring to. Officials declined to give any further comment on Monday.

The announcement came shortly after PetroChina, whose 2.6 million-bpd in refining capacity lags far behind rival Sinopec’s 4.2 million-bpd as at end-2008, said it had secured approval to raise US$15-billion in debt to finance expansion.

But with decelerating demand growth and a number of major new domestic refineries still in the pipeline, including two being built by PetroChina this year, China has little need to go overseas to secure more refining capacity, suggesting the SPC deal is more about trading tactics than resource strategy.

In terms of geography, SPC will plug a hole in PetroChina’s domestic refining system, which is heavily concentrated in the north, giving it a foothold in the Sinopec-dominated south and helping it close a trading expertise gap with Sinopec’s trading arm Unipec, a major player on the Middle East crude market for years.

“The SPC deal… will bring PetroChina equity of refined fuels that it is lagging behind rival Sinopec at home, so that it can leverage both the Singapore trading hub, markets like Indonesia and Vietnam, and China’s coastal consumers,” said Kang Wu, who covers China oil industry at East-West Centre in Hawaii.

The US$1.02 billion to buy Keppel Corp’s 45.5% stake will trigger a mandatory buyout offer for SPC, which also operates small oilfields and pursues exploration activities in Vietnam and Indonesia. China’s growing importance on regional refined fuel markets has been made increasingly clear, as its volatile trading habits whipsaw markets. It exported record volumes of diesel and large amounts of gasoline in April, with the bulk shipped to Singapore, a reversal from record-high imports just a year ago.

Despite its expanded trading arsenal, most traders see little risk that Chinaoil — kept on a rather short leash by its conservative parent — will fall into the same risk-addicted trap that nearly felled China Aviation Oil Trading, the high-flying Singapore-based Beijing-backed outfit that secretly racked up US$550-million in losses in wrong-way bets five years ago.

“The expansion is totally different from CAO under Chen Jiulin’s time, which focused primarily on trading,” said East-West Centre’s Wu. “PetroChina, if it’s to involve in more trading, will be hedging either its upstream or downstream business.”