VZCZCXRO6002
RR RUEHCN RUEHGH RUEHVC
DE RUEHBJ #2391 2310910
ZNR UUUUU ZZH
R 190910Z AUG 09
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC 5711
INFO RUEHOO/CHINA POSTS COLLECTIVE
RHMFIUU/CDR USPACOM HONOLULU HI
UNCLAS BEIJING 002391
DEPARTMENT FOR INR/R/MR, EAP/CM, EAP/PA, EAP/PD, C
HQ PACOM FOR PUBLIC DIPLOMACY ADVISOR (J007)
SIPDIS
E.O. 12958: N/A
TAGS: OPRC KMDR CH PREL ECON
SUBJECT: MEDIA REACTION: NORTH KOREA, U.S.-CHINA ECONOMIC RELATIONS,
U.S.-CHINA TRADE RELATIONS
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Editorial Quotes
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1. NORTH KOREA
"North Korea Collapse Theory" can stop (pg 14)"
The official Communist Party international news publication Global
Times (Huanqiu Shibao)(08/19): "Zhang Qiyun, a professor at Beijing
University, said that Western media always focuses on speculating
North Korea's collapse. The rumors say that the U.S. has frequently
invited China to discuss the aftermath of North Korea's eventual
collapse. Repetitive moves by North Korea this year; launching
missiles, conducting a nuclear test, voicing challenges, leaders
inspecting construction projects etc., are believed to relate to the
new leader's succession arrangement. In order to ensure a smooth
power transition in North Korea, the current leader has made great
efforts to consolidate his successor's authority. Due to these
preparations, the chaotic situation in North Korea that western
countries expect is unlikely to occur. North Korea, under the
possible leadership of Kim Jong-un, will slowly develop, open up and
reform their country in order to survive the current international
situation. North Korea's policy, in the long term, will combine
reliance on China, peace with South Korea, an opened country and a
developed economy."
2. U.S.-CHINA ECONOMIC RELATIONS
"Is it inappropriate to 'sell short-term U.S. bonds while holding
long-term bonds'?"
Guangdong 21st Century Publishing Company Ltd.'s business newspaper
21st Century Business Herald (21Shiji Jingji Baodao)
(08/19):"Analysts believe that 'selling short-term bonds while
holding long-term bonds' may not be the best choice. If in the
future, the Federal Reserve's benchmark interest rate continues to
rise, China can be hardly be expected to maintain its decision to
decrease its short-term bond holdings. The economist Lu Zhengwei,
said that China's reduced holding of short-term U.S. bonds is a
tentative measure taken because of the ups and downs in the U.S.
national debt market. It reflects that China anticipations there
will be a slight drop in the yield of U.S. bonds. Many analysts
indicate that their reduced holding will not be maintained. The
ability of U.S. bond holders to avoid risks is further strengthened
by the slide in the U.S. stock market. China Academy of Social
Science's Zhang Ming said that 'the Chinese and international
investors have chosen to increase their holdings of long-term U.S.
bonds.' This shows that their faith in the U.S. market has
increased. 'Selling long-term bonds and holding short-term bonds'
may be an investor's next move."
3. U.S.-CHINA TRADE RELATIONS
"China may take counter measures concerning the U.S.-China tire
industry tariff case"
The independent Chinese weekly business newspaper distributed in
major cities throughout China, Economic Observer (Jingji
Guanchabao)(08/19): "Deng Yali, the Secretary General of the Chinese
Rubber Industry, said that the tire tariff case can still be
seriously considered. The American Trade Commission feels great
pressure and finds it difficult to make a decision. The Chinese
Rubber Industry is planning to suggest that the Ministry of Commerce
should take counter measures, sanctions, against the U.S. In order
to pressure U.S. President Obama, these measures could include
increasing import tariffs on products from the U.S., limiting U.S.
imports or not allowing any importing. Xu Youming at Hangzhou
Zhongce Rubber Company Ltd. indicated that the tire dispute does not
only affect the tire industry. Once the U.S. implements tariffs,
those tariffs will also concern other aspects of U.S.-China trade.
The Chinese lobbying delegation to the U.S. has realized that the
U.S. Worker's Union is using this case as a test of the Obama
administration's attitude on the issues such as this. The Bush
administration denied special protection measures against China. If
Obama approves these special protective measures, China will take
immediate counter measures. China should reflect on what is wrong
with its trade patterns, which rely too much on exports."
GOLDBERG