Responses to the US election

‘We wish US president-elect Obama well’ said the official English-language China Daily in a fulsome post-election tribute. ‘Like American people on the other side of the Pacific, we are excited, too, at the landslide win of Democrat Barack Obama.’

Earlier, Obama’s protectionist remarks condemning China as a ‘currency manipulator’ in a pre-election letter to a textile group was dismissed by some Chinese commentators as pre-election rhetoric.

Meanwhile opinion in Taiwan favoured McCain who was seen as more likely to favour US arms deals with the island.

CHINA IN AFRICA

Sudanese armed forces found a Chinese survivor of a group of nine colleagues kidnapped from an oil field nearly two weeks earlier.

But despite the kidnapping and killing, Chinese authorities made it clear that the incident would not deter China from continuing to invest.

Significantly, at the UN China signalled that it
would not introduce a resolution to defer the indictment of President al-Bashir at the International Criminal Court.

One US Darfur activist suggested that as Vice-President-Elect Jo Biden is known as a ‘hawk’ on the issue, ‘Now is the Time for Action on Darfur’

DRC rebel leader Laurent Nkunda was declaring his opposition to China’s £5bn mining and infrastructure deal with the Kinshasa government. But some commentators interpreted his position as a ploy to attract Western support.

As piracy worsens around the Horn of Africa, some shipping companies were even considering rerouting cargoes round the Cape, prompting the head of a UN agency to urge an international naval force to combat piracy in the Gulf of Aden.

Meanwhile, away from the spotlight, China announced it was to increase its special cooperation zones in Africa to ten.

STAYING ON THE RAILS

Zambia and China marked the 30th anniversary of the TAZARA railway.

But Nigeria announced it was suspending an $8bn rail contract with China as contracts negotiated by President Obasanjo were reviewed by his successor.

However China’s domestic railway building industry looked set for a boost as the Chinese government seemed set to use a railway building programme as an economic stimulus.

DOWNTURN AND UNREST

As output surveys showed a record fall in the country’s manufacturing output, China’s premier Wen Jibao warned in an authoritative Communist Party journal that high growth was needed to maintain social stability.

In another article in the same issue of the journal ‘Seeking Truth’, Public Security Minister Meng Jianzhu told China’s police to avoid inflaming riots and protests and to go easy on protesters. The minister admitted that economic forces and the internet had made citizens more sensitive to a wider range of ideas, sparking an increased number of ‘mass incidents’ as riots and protests are officially described.

‘This financial crisis in America is going to kill us. It's already taking food out of our mouths’, said one assembly line worker, suddenly out of a job when his Hong Kong-owned toy factory in Guangdong closed without warning leaving workers unpaid.

After angry workers protested outside the closed factory and local government offices, the local administration agreed to pay $3.5m of back pay to the workers in the failed toy maker. Other local administrations in the Pearl River Delta agreed similar payouts as it was announced that over half of China’s toymakers – most of them located in southern Guangdong province – had gone out of business in 2008.

The region is seeing an apparent epidemic of financially troubled plants abandoned by the boss, leaving behind unpaid workers and debts.

A local trade association predicts that by late January, Dongguan and its neighbours Shenzhen and Guangzhou will lose 9,000 of their 45,000 factories. This follows a possibly mistimed strategy by the provincial administration to encourage low-cost manufacturing to move elsewhere in order to move the province up the value chain - a policy described as ‘empty the cage for the new birds’.

There were signs that the downturn was affecting employment beyond the Pearl River Delta, and was affecting white-collar workers as well as rural migrant labour.

The Chinese Government responded with a programme of job support to the labour-intensive sector including:
- Increasing bank loans and raising export tariff rebates
- Working out favourable taxation, financing and other policies to encourage start-ups
- Providing more vocational training for laid-off workers to increase their chances of re-employment
- Establishing a pension system in rural areas and expanding the urban pension system to cover rural migrant workers.

There were also authoritative reports that senior officials, shocked by the scale of the downturn, were planning a radical economic stimulus package to include infrastructure and clean energy projects, a parallel with the programme of President-elect Obama.