China, From Within: A First for Chinese Women, and a Prominent Muckraker Quits

Every day, FP‘s China team at the Tea Leaf Nation channel scours dozens of Chinese media outlets to find compelling stories unreported in Western mainstream press. This week, we bring you local government bankruptcy, China’s tiger parents, a legal first for Chinese women, and more.

A draft from China’s Ministry of Finance proposes that local governments be allowed to go bankrupt.

Local government debt is a massive and rising problem in China, and the central government may be considering new steps to rein in local debt, according to a Nov. 13 article by independent newspaper 21st Century Economic Report. The new proposal from the Ministry of Finance, if it becomes official policy, would allow local governments to announce bankruptcy and follow bankruptcy procedures. Under pressure to show continuing economic growth in a gradually slowing economy, local governments have borrowed huge sums to fund construction and infrastructure projects, leading to growing financial risk. Previously, in early October, the central government had announced that it would cap local government debt in an effort to stymie burgeoning debt, as well as declaring that there would be no bailouts for debt-ridden local governments — though it stopped short of allowing bankruptcy.

Well-known journalist Luo Changping announces he’s quitting journalism to become an entrepreneur.

Luo made a name for himself by exposing the corruption of top government official Liu Tienan, who was later fired and is currently standing trial. But press freedom in China has deteriorated since President Xi Jinping came to power in March 2013, making investigative journalism even riskier. Luo Changping’s own social media accounts have also been subject to particular scrutiny, though his accounts have not been shut down, as has been the fate of other independent political commentators in China. Entrepreneurship may provide a much more lucrative, and less risky, future for the 34-year-old Luo.

Illicit capital-raising continues to plague coastal regions.  

Another case of illegal capital-raising has emerged in Dongyang, according to a Nov. 14 report by independent newspaper National Business Daily. This city, in wealthy Zhejiang province, first found the spotlight in 2009 when a businesswoman named Wu Ying was sentenced to death for illegal capital-raising that amounted to a Ponzi scheme; her sentence was later commuted to life imprisonment. In the new case, a well-known construction company landed on the brink of bankruptcy after raising approximately $150 million from more than 3,000 individuals. The area’s construction companies often raise large amounts of loans from private individuals, instead of relying on banks, but the current contraction of the real estate market has put pressure on their cash flow.

The education bureau banned high-stress exams, but some parents still organize their own.

Many Chinese cities now disallow the use of exams for placement in middle schools in the name of giving children a happier childhood. In Wuhan, the capital of central Hubei province, such exams were banned 12 years ago. But in attempt to secure spots for their children in highly sought-after schools, parents are now trying to distinguish their children from the pack by going as far as organizing their own exams. According to a Nov. 12 report by state-run China Youth Daily, over 3,500 students participated in a voluntary exam held in early October, organized by parents who met on Internet forums. Officially, the scores do not affect a school’s admissions decisions, but the parents still believe that the exams make a difference.

A Chinese court has recognized gender discrimination in employment for the first time.

A court in the Zhejiang provincial capital of Hangzhou ruled in favor of a woman who complained that a local culinary school had discriminated against her on the basis of gender. According to a Nov. 14 report by state-run Zhejiang Online, the woman had applied for a clerk position that the school advertised on job-seeking websites as for "males only." The court awarded the plaintiff $326.