This Week in China

Shizuo Kambayashi/Pool/Getty Images

Politics

Chinese President Hu Jintao is visiting Japan for a diplomatic summit on Sino-Japanese relations.  Some are optimistic that Hu and Japanese Prime Minister Yasuo Fukuda can settle claims on undersea gas resources in the East China Sea by summer. The two leaders will also engage in some literal ping-pong diplomacy.

It’s still unclear what is causing the high number of hand, foot, and mouth disease cases in Anhui province. Almost 16,000 cases have been reported, including 28 fatalities likely linked to a coupling with the virus EV71. Government officials say that the high fatalities are not evidence of a new strain.  Infections in Singapore and Vietnam are also much higher than normal this year. The Chinese government plans to step up public hygiene efforts to combat the spread of infectious disease this summer.

The Chinese State Food and Drug Administration, charged with investigating the contamination of the blood-thinner Heparin, has accused U.S. drug company Baxter of being unhelpful in the investigation. It also maintains that the link between the drug and the deaths in the United States has not yet been proven since other countries using similar substances reported no such fatal allergic reactions.

Chinaacknowledged that changes in visa restrictions are taking place ahead of this summer’s Olympic Games. However, the Foreign Ministry insists that the changes are “according to the practice of the past Olympics and usual international practice.” Fewer (if any) multiple entry visas will be issued and some travelers may need letters of invitation, and proof of hotel accommodations and return air tickets. Previously, the ministry had denied that any changes were planned.

Concerned about overspending on student subsidies, the Chinese government is limiting the growth of doctoral programs to less than two percent annually in favor of professional degree training programs. China is the world’s leader in turning out phD’s with an estimated 60,000 in 2007, yet over half of graduating candidates end up in government rather than academia.

Economy

The Hong Kong stock market is looking abroad for investment growth and hoping to attract sovereign wealth funds. Government intervention in the Shanghai market is hurting its international reputation.

Forget poverty assistance programs, relocation is the best way to help drought-stricken farmers in Ningxia Hui Autonomous Region in northwestern China, said a local official. Around 206,000 people will be relocated over the next five years to irrigated and suburban areas along the Yellow River that can better support them at a cost of $406 million.   

China’s household spending power will surpass that of Britain’s by 2017, putting it third in the world behind the U.S. and Japan according to a forecast released by Barclay’s and the Economist Intelligence Unit today. Full report (PDF).

Taiwan

Three Taiwanese government officials have resigned as investigators searched their homes and offices for clues in the case of the missing $30 million in “diplomatic aid” to Papau New Guinea. There is a middleman on the run according to the International Herald Tribune.  

Analysis

The American Institute in Taiwan held a video conference panel discussion on Tuesday about the U.S.-Taiwan relationship in light of coming political changes in both countries. Speakers included Robert G. Sutter of GeorgetownUniversity, Alan D. Romberg of the StimsonCenter, and Bonnie Glaser of CSIS. The Taipei Times reports on the event saying that experts don’t expect big changes.

Jamil Anderlini of the Financial Times looks at the latest incarnation of China’s fenqing, or hyper-nationalistic “angry youth.”

Adidas CEO Herbert Hainer sits down with Der Spiegel to talk about the role of his company’s gear in the torch relay saying, “I don’t have a guilty conscience,” and stressing the company’s commitment to sports, not politics. (Hat tip: The American’s Duncan Currie.)  

This week’s China moment

It took forty workers 48 hours to complete the world’s largest Chinese flag. The flag is roughly 200 x 300 feet (88.88 meters- note the lucky eights). The banner was so big, it needed a last-minute switch to a larger-class airplane as it left Beijing. It will follow the torch relay around the country and go on display in Beijing a day before the Olympic Games. (Hat tip: Passport reader Andrew Schorr)