10 Bizarre Food Scams That Could Only Happen In China

Yahoo's China page closes following gradual phase out

After seeing its popularity decline, Yahoo's Internet portal in China has formally closed down, in a sign that e-commerce giant Alibaba Group is transitioning away from the brand.

The portal went offline on Sunday. Its closure is rooted in an agreement Yahoo made last year with Alibaba Group, which has control over the Yahoo brand in the country.

For years now, Alibaba has operated Yahoo's China business as part of $1 billion deal investment from the U.S. company made back in 2005. In exchange, Yahoo acquired a 40 percent stake in Alibaba.

But last year, Yahoo agreed to sell part of that stake back to the Chinese e-commerce company, following ongoing disagreements between the two Internet giants. The share buy-back resulted in Yahoo granting Alibaba "a transitional license" to continue operating its brand for up to four years.

Since then, Alibaba has been phasing out Yahoo products. In December, Yahoo's music service in China went down. Then earlier this year, Yahoo's China site announced the closure of its email service, which formally went offline last month.

Sunday's shutdown of Yahoo's Chinese portal is the result of a strategy adjustment, the site's team said in an Internet posting. The portal, at cn.yahoo.com, now reroutes to an Alibaba site promoting public welfare projects.

Alibaba declined to elaborate on the site's closure. Yahoo had no immediate comment.

The popularity of the Yahoo portal site has gradually waned over the years, as the influence of Chinese Internet companies has only grown. In May, the site ranked as the tenth most-visited Internet portal in the country, according to CR-Nielsen, an Internet research company.

Alibaba likely has no more use for the Yahoo brand, considering that the company is focused on e-commerce, and not media portal sites, said Li Zhi, an analyst with Beijing-based research firm Analysys International.

"China Yahoo has been under Alibaba for many years. Its most valuable properties have been dismembered and used," she said, pointing to how Alibaba had originally wanted access to Yahoo's search technologies. In 2009, however, Yahoo decided to use Microsoft Bing to power its searches.

"Alibaba already has no need for a China Yahoo that's been squeezed dry," Li added.

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China investigating IT suppliers linked with Apple for polluting rivers

Local authorities in China are investigating two electronics suppliers linked with Apple and also reportedly HTC of dumping heavy metals in the country's rivers after watchdog groups accused them of damaging the environment.

Last week, five Chinese environmental groups issued a report claiming that factories of Foxconn Technology Group and Unimicron Technology had been polluting rivers in the country's Taihu basin, where the cities of Shanghai and Kunshan are located.

The groups claimed the factories from the two suppliers had dumped large amounts of nickel and copper that had been poisoning the nearby water and soil, and threatening the health of local residents. At the Foxconn facilities, the water was described as black, and carrying an "awful stench". The affected soil had become yellow and red in color, and planted crops were also unable to grow. (A video of the report can be found here.)

On Friday, Kunshan's environmental protection bureau said it would investigate the matter, and monitor the water drained by the facilities. Any violations found will be dealt with, the city said in statement posted on the its official microblog account.

Taiwan-based Foxconn, which builds products for Apple, Microsoft and Sony, said it was aware of the claims made by the environmental groups, but said the waste treatment from its facility in Kunshan was in line with local regulations.

"The river that runs through the middle of that industrial park receives waste water discharges from a number of companies that are based in the park," the company said in a statement. Foxconn also said it was supporting government plans to protect the Taihu lake basin, and advocated other companies should do the same.

Unimicron, another Taiwan-based company, did not immediately respond to a request for comment.

The dumping of the heavy metals by electronic suppliers usually comes from the manufacturing of printed circuit boards, according to the Chinese environmental groups. Copper toxicity can cause the poisoning of fish and soil, and lead to cardiovascular illness in humans, while nickel is a known carcinogen, the groups added.

In its report, the environmental groups said they suspected Unimicron's facility in the lake basin of supplying to smartphone maker HTC.

In response, HTC said, "The company has been taking a proactive approach to ensure proper and prudent supply chain management," and works to ensure all of its suppliers follows the company's code of conduct.

In recent years, Chinese environmental groups have been critical of electronic manufacturers in the country for polluting. In the past, Apple was accused of failing to prevent its suppliers from damaging the environment. Apple later agreed to jointly audit one of its suppliers' factories in China with a prominent environmental group in the country. Apple did not respond when asked to comment on the investigations by Kunshan's environmental protection bureau.

Head of Google China leaves post, to be replaced by executive from Europe

Google’s leader for its China operations, John Liu, is leaving his position as the company continues to maintain a low-key presence in the nation following heated disputes over online censorship.

Liu has “decided to pursue other opportunities,” Google said in an email on Monday. Liu had been at Google for nearly six years, and originally was head of sales for the company’s Greater China operations. In 2009, he was elevated to head of Google’s Greater China business after the departure of his predecessor, Kai-Fu Lee, a tech entrepreneur well-known in the country.

Liu worked at Google as its search business in China slowly grew to compete with the country’s largest search engine Baidu. But in 2010, Google decided it would no longer agree to China’s demands for online censorship, and initiated a partial retreat from the Chinese market.

Since then, Google’s presence in China has diminished. The company’s market share for search is at 3 percent, according to Chinese analytics site CNZZ.com. In addition, many Google services, such as Google Play, YouTube or Google Plus are either blocked or not offered in the country.

The company, however, sees a major opportunity in helping Chinese companies advertise outside the country through its online services. At the same time, Google’s Android OS dominates the nation’s handset market, and has close to a 90 percent market share.

Scott Beaumont, who leads Google’s partnerships business in Europe will take over from Liu starting in mid-August. “He’ll continue our focus on helping Chinese businesses of all sizes grow locally and globally,” Google said.

Differences on Cybertheft Complicate China Talks

And to no one’s surprise, the Chinese had an answer ready: that the publication of secret documents showing the extent of American surveillance of Chinese universities and other institutions undercuts the Obama administration’s case.

That friction, American officials conceded in private, underscores how difficult it will be for the United States to make progress on what President Obama and his top aides have said is now a central issue between two countries whose economies are intertwined and whose militaries are in competition.

And at a time when the Chinese economy is showing signs that it is headed into a period of slower growth, the administration’s hopes of persuading Chinese leaders to crack down on the daily barrage of theft and espionage over the Internet — considered crucial to keep China competitive — is likely to be even more difficult.

“We both will benefit from an open, secure, reliable Internet,” Mr. Biden said at the opening of the talks, the Strategic and Economic Dialogue, an annual effort to bring together top Chinese and American cabinet and subcabinet officials on a range of problems. “Outright cyber-enabling theft that U.S. companies are experiencing now must be viewed as out of bounds and needs to stop.”

Mr. Biden was making the same point that Mr. Obama repeated in recent weeks, including during a meeting with China’s new president, Xi Jingping, in California. To the Americans, China’s cybertheft — often directed by units of the People’s Liberation Army — is different, and far more corrosive, than standard government espionage.

An American official who was sent out to brief reporters after the first day of talks said that when it came to the theft of intellectual property — including the designs of commercial products and military aircraft — “we don’t do it, and we don’t think any country should do it.”

China has always viewed the issue differently, seeing far less of a distinction involving what it regards as issues of economic and military security.

“For many Chinese, it is bizarre that how Washington can continue to pose as the biggest cyberespionage victim and demand others behave well,” China Daily, a government-influenced publication, wrote before the meeting, “after former U.S. intelligence contractor Edward Snowden revealed that U.S. spy agencies hacked deep into China and other countries’ computer networks, including those of government, military, research, educational and business organizations.”

It concluded that “by dividing cyberespionage into ‘bad’ and ‘good’ activities, Washington is trying to dictate the rules for global cyberdomain, which is a public space.”

American and Chinese cyberexperts met Monday for the first time in a working group intended to address the issue. That alone was progress: when the United States asked Chinese officials to discuss cybertheft, cyberespionage and cybersecurity at a meeting several years ago, there was almost no give and take. But new attention focused on the activities of the Chinese military, notably Unit 61398 of the People’s Liberation Army, has made it harder for Mr. Xi’s government to ignore the United States’ protests.

Mr. Snowden’s revelations may be a gift to the Chinese, because they shift the focus from China’s covert activities to Washington’s. And even American scholars say the Chinese have a good argument. “It is not true that ‘unwritten rules’ prohibit economic espionage,” said Jack Goldsmith, a Harvard law professor and cyberexpert who served in the Bush administration. “Economic espionage is expressly prohibited by U.S. domestic law but is not prohibited by international law, written or unwritten, and it is widely practiced.”

The most fruitful part of the conversations, American officials indicated in a briefing late on Wednesday, dealt with North Korea and climate change, two areas where the governments have been moving into alignment.

Johnny Depp’s ‘Transcendence’ Scores China Partner DMG Entertainment

Alcon Entertainment and China’s DMG Entertainment announced a multi-picture deal in Beijing, China today, which will first see them co-finance, produce and distribute the 2014 Johnny Depp-starring tentpole Transcendence.

The two companies also announced that they will next partner on the reboot of Point Break, which Alcon has been developing.

DMG will distribute both pictures in China, while Warner Brothers will distribute them in North America.

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“We are very excited that these will be the first two films of what will be a long- lasting and very successful partnership with Alcon,” said Dan Mintz, CEO of DMG Entertainment. “We look forward to making history with our new partner.”

“DMG brings a level of global insight and imagination to the project, and, most importantly, a strong relevancy to China," said Alcon co-founders and co-CEOs Broderick Johnson and Andrew Kosove."Their track record is unprecedented. To watch DMG’s performance on the U.S.-China collaborations of Looper and Iron Man 3, and then know our movies are following on that kind of success...it’s nothing less than awesome.”

Directed by Chris Nolan’s longtime choreographer, Wally Pfister, Transcendence stars Depp, Morgan Freeman, Paul Bettany, Rebecca Hall and Kate Mara, in a science fiction story of artificial intelligence. It will be executive produced by Nolan and Emma Thomas.

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“Without giving away too much, Transcendence is about that moment when human consciousness and the insanely fast rise of computing power collide,” Mintz said. “It pulls from the idea of singularity to tell a truly meaningful story that is more ‘science reality’ than science fiction. This is something that is likely to happen in our lifetimes and that makes it a story everyone can get into.”

DMG last partnered with Marvel Disney to co-produce Iron Man 3. The project wasn't able to secure official co-production status from the Chinese government (which entails a higher take of local box office), but DMG's local connections gave the film unprecedented marketing reach in the country, including a promotional event hosted by Robert Downey Jr. within the historic Forbidden City in Beijing, and various product placement deals with Chinese brands. The film was also released in a special Chinese cut, featuring more footage of Chinese stars Wang Xueqi and Fan Bingbing, which DMG consulted on. Iron Man 3 grossed $123 million (755 million yuan) in the country.

Twitter: @sajilpl

China Taps a Growing Phone Market

Until then, the global market for smartphones had been defined by the rivalry between Apple and Samsung Electronics. They built expensive phones as must-have products for affluent consumers in wealthy countries.

Now more phones are being designed for consumers in emerging markets, who are expected to account for most of the growth in smartphone sales in the future. That presents an opportunity for the major Chinese phone makers, like Huawei, Lenovo, ZTE, Coolpad, Xiaomi and Oppo.

While Samsung is the biggest smartphone vendor in China, with a market share of 20 percent in the first quarter of 2013, according to the research firm Canalys, several Chinese companies have surged past Apple, which holds 8 percent.

These include internationally recognized names like Huawei, known for network switching gear, and Lenovo, known for ThinkPad laptops, which moved into the No. 3 and No. 4 positions in the first quarter. But there are nearly 400 other little-known makers in China, where two-thirds of the world’s smartphones are made. One of these, Coolpad, leapfrogged from seventh place a year ago to second in the first three months of this year, with a 10 percent share.

“There’s a long tail of local competitors that are going to push Apple and Samsung harder and harder,” said Neil Mawston, an analyst at Strategy Analytics. “There’s a million and one people trying to eat their lunch.”

Chinese phone shoppers are concerned about price because most phones are sold without subsidies from network operators. In the United States and Europe, the wide use of subsidies masks what consumers pay for phones.

The Chinese also switch phones far more often than their counterparts in the West — generally after about six months, analysts say, compared with every two years or so in developed economies. Fickle customers mean market share shifts swiftly, and the fortunes of companies rise and fall almost as fast.

Apple’s and Samsung’s position in the high end of the market allows them to collect most of the profit from smartphone sales in China, analysts say. Apple sells 55 percent of the phones priced at $450 or more, with Samsung accounting for 40 percent, according to Sanford C. Bernstein, a brokerage firm. Apple’s iPhone 5 costs about $780, while Samsung’s Galaxy S4 costs about $850.

But growth in this segment is slowing. Analysts at Bernstein expect sales of smartphones $450 and up in China to rise to 296 million units this year, from 235 million in 2012. But the total will flatten out at around 300 million a year, the firm said.

By contrast, sales of phones priced at less than $200 are expected to surge to 400 million units this year, from 234 million last year, with a further jump to 685 million in 2015, the firm says. The low end is growing faster because prices of smartphones have fallen so much that hundreds of millions of Chinese consumers are now able to replace old-fashioned feature phones that lack mobile data capabilities.

“The question for Samsung and Apple is whether they are equipped to compete in the developing markets, especially China, where the growth is going to happen,” said Pete Cunningham, an analyst at Canalys.

Some of these phones are simply knockoffs of handsets from Samsung or Apple, often housed in cheap plastic shells or offering less memory, lower-resolution screens or inferior cameras. Last year, one Chinese brand, Goophone, introduced a clone of the iPhone 5 for $150, even before Apple released the iPhone 5 in China.

It bears a resemblance to Apple’s phone, but the Goophone i5 is different in an important respect — it runs on a version of Google’s Android software.

The challenge for the Chinese makers is to go global. Coolpad began selling its Quattro 4g in the United States through MetroPCS, a mobile network operator. It drew mixed reviews in the United States, but it sold for less than $100 under some promotions.


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China sees rise in international Trojan and botnet attacks

China saw an increase in Trojan and botnet attacks coming from other countries in 2012, as the amount of mobile malware in the country also surged, according to a local security group.

During the year, a total of 73,000 Trojan and botnet command-and-control servers had hijacked 14.2 million host machines in the country. The number of Trojan and botnet servers marks an almost 60 percent increase from 2011.

Close to 13,000 of those servers were based in the U.S., the country also responsible for the largest number of Trojan and botnet attacks targeting China. South Korea was second, followed by Germany.

China's National Computer Network Emergency Response Technical Team (CNCERT) reported the figures on Thursday. They were later published by the nation's state press, Xinhua News Agency.
 
Both China and the U.S. have lately been at odds with one another over cyber security. Earlier this year, U.S. officials warned the country to stop with its alleged state-sponsored hacking attacks, a claim Chinese officials vehemently rejected.

Former U.S. National Security Agency contractor Edward Snowden has also complicated matters. The leaker has reportedly accused the U.S. government of hacking into Chinese telecommunication companies and universities. Last month, China's foreign ministry said it was "gravely concerned" about the alleged cyber espionage and has the matter brought up with the U.S.

Chinese officials have previously claimed the country is a major victim of cyber attacks. On Thursday, CNCERT reported that the Trojans and botnets targeting China were designed to steal data or to help facilitate other hacking attacks.

In addition, China is also witnessing a boom in mobile malware. CNCERT encountered close to 163,000 samples of mobile malware in 2012, an increase of 25 times from the previous year.

Most of the malware, at 82.5 percent, was designed for Google's Android OS. About 40 percent was also designed to steal funds from the user by secretly triggering fee-based services on the device.

Snowden seeks asylum from several countries, including China and Russia

Applications for asylum or asylum assistance were submitted on behalf of former U.S. National Security Agency contractor Edward Snowden to a number of countries including China, Russia, and India, whistle-blower site WikiLeaks said Tuesday.

Snowden, who leaked information about NSA surveillance programs, was charged by the U.S. in a federal court for theft of government property, unauthorized communication of national defense information and willful communication of classified communications intelligence information to an unauthorized person. The complaint in the U.S. District Court for the Eastern District of Virginia was filed on June 14.

The asylum-related requests were submitted by hand by Sarah Harrison, WikiLeaks' legal advisor in the Snowden matter, to an official at the Russian consulate at Sheremetyevo Airport in Moscow late Sunday evening, WikiLeaks said.
 
Among the countries approached were Austria, Bolivia, Brazil, China, Cuba, Finland, France, Germany, India, Italy, Ireland, the Netherlands, Nicaragua, Norway, Poland, Russia, Spain, Switzerland, and Venezuela. A Russian official has confirmed receiving an application for asylum in the country, according to reports.

"The requests join or update others previously made including to the Republic of Ecuador and the Republic of Iceland," WikiLeaks said in a statement.

WikiLeaks did not provide information on the outcome of the requests, except that the requests have started to be delivered by the Russian consulate to relevant embassies in Moscow.

Snowden's request for asylum in Ecuador hasn't moved because the government of Ecuador wants him to seek asylum from Ecuador territory, according to reports. U.S. vice president Joe Biden is also said to have spoken to Ecuador President Rafael Correa to ask him not to grant Snowden asylum.

Snowden, who is said to be in the transit facility of the airport in Moscow after the U.S. revoked his passport, on Monday criticized the "deception" of U.S. President Barack Obama who last week said that he would not permit any diplomatic "wheeling and dealing" over the Snowden issue.

"Yet now it is being reported that after promising not to do so, the President ordered his Vice President to pressure the leaders of nations from which I have requested protection to deny my asylum petitions," Snowden said in a statement released through WikiLeaks.
 
The Obama administration has now adopted the strategy of using citizenship as a weapon, Snowden wrote. "Although I am convicted of nothing, it has unilaterally revoked my passport, leaving me a stateless person. Without any judicial order, the administration now seeks to stop me exercising a basic right. A right that belongs to everybody. The right to seek asylum."

The NSA was allowed by a court order to collect phone metadata of a large number of customers of Verizon, according to a report in the Guardian last month. The information was said to have been leaked by Snowden who also passed on documents that suggested that the NSA had real-time access to the content on servers of Internet companies like Facebook and Google.

26 U.S. senators, cutting across party lines, said on Friday they are seeking "public answers" on a number of issues related to the surveillance, including whether the National Security Agency collected in bulk other data such as credit card purchases and financial information in the U.S. besides phone records, and specific evidence of how the surveillance helped foil terrorist plots.

New legislation, introduced last week in the U.S. Senate, called the FISA Accountability and Privacy Protection Act of 2013, aims to reform the Patriot and FISA Amendments Acts to provide greater oversight and control to the government's surveillance programs.

Whistle-blowers, authors, academicians and actors have urged Correa to grant Snowden political asylum, stating that the Obama administration, U.S. Congress and most of the media have focused "their ire on the messenger," instead of focusing on the danger to citizens' freedom and privacy exposed by the revelations, and the reforms necessary to protect citizens' rights. A letter signed by Pentagon papers whistle-blower Daniel Ellsberg, author Noam Chomsky and film director Oliver Stone, among others, was released Monday by organization Just Foreign Policy.

China media warns Philippines of 'counterstrike' in South China Sea

New recruits of the Chinese Navy march with their guns during the parade marking the end of their first training session in Qingdao, Shandong province, March 4, 2013.
BEIJING - China's state media warned on Saturday that a "counterstrike" against the Philippines was inevitable if it continues to provoke Beijing in the South China Sea, potentially Asia's biggest military troublespot.
The warning comes as ministers from both countries attend an Association of Southeast Asian Nations meeting in Brunei, starting Saturday, which hopes to reach a legally binding code of conduct to manage maritime conduct in disputed areas.
At stake are potentially massive offshore oil reserves. The seas also lie on shipping lanes and fishing grounds.
Both China and the Philippines have been locked in a decades-old territorial squabble over the South China Sea, with tensions flaring after the Philippines moved new soldiers and supplies last week to a disputed coral reef, prompting Beijing to condemn Manila's "illegal occupation".
The overseas edition of the People's Daily, the official newspaper of the Chinese Communist Party, said in a front-page commentary that the Philippines had committed "seven sins" in the South China Sea.
These include the "illegal occupation" of the Spratly Islands, inviting foreign capital to engage in oil and gas development in the disputed waters and promoting the "internationalization" of the waters, said the commentary.
The Philippines has called on the United States to act as a "patron", while ASEAN has become an "accomplice," said the commentary, which does not amount to official policy but can reflect the government's thinking.
"The Philippines, knowing that it's weak, believes that 'a crying child will have milk to drink'," the People's Daily said, accusing Manila of resorting to many "unscrupulous" tricks in the disputed waters.
Beijing's assertion of sovereignty over a vast stretch of the South China Sea has set it directly against Vietnam and the Philippines, while Brunei, Taiwan and Malaysia also lay claim to other parts of the sea.
The 10-member ASEAN hopes to reach a legally binding Code of Conduct to manage maritime conduct in disputed areas. For now a watered-down "Declaration of Conduct" is in place.
On Thursday, China's Foreign Minister Wang Yi warned that countries with territorial claims in the South China Sea that look for help from third parties will find their efforts "futile", adding that the path of confrontation would be "doomed".
Last week, China vowed to protect its sovereignty over the Second Thomas Shoal, known in China as the Ren'ai reef. The Philippines is accusing China of encroachment after three Chinese ships, including a naval frigate, converged just five nautical miles (nine km) from an old transport ship that Manila ran aground on a reef in 1999 to mark its territory.
Last year, China and the Philippines were locked in a tense two-month standoff at the Scarborough Shoal, which is only about 124 nautical miles off the Philippine coast. Chinese ships now control the shoal, often chasing away Filipino fishermen.

28Tbps undersea fiber backed by Google, China Telecom, NEC goes live

An 8,900 kilometer undersea fiber cable system in Asia, backed by a consortium including Google, China Telecom, NEC and a host of local telecommunications companies, went live Thursday.

 

The Southeast Asia-Japan Cable (SJC) system has an initial capacity of 28Tbps and connects China, Hong Kong, the Philippines, Singapore and Brunei with Japan and its link to transpacific fiber that runs to the U.S. The project will provide the lowest latency connection from Singapore to Los Angeles, said its main supplier, Japan's NEC.

 

The project was first announced in 2009 and construction started in April of 2011. Total costs were about US$400 million. NEC said the cable system consists of six fiber pairs that can carry the equivalent of 3 million HD video streams at the same time.

 

The majority of the investors in the project are large telecommunications providers and mobile operators that operate in the countries that were connected. In addition to China Telecom, these include China Mobile, Hong Kong's Donghwa Telecom, Globe in the Philippines, SingTel, and TOT in Thailand.

 

Google is an exception. Its share in the project could be used to link up its three massive new Asian data centers and connect them to its U.S. presence. In September 2011, Google acquired 15 hectares (150,000 square meters) in Taiwan to construct a facility that is to go live this year. It also said it acquired smaller plots in Hong Kong and Singapore that month to build data centers in those countries as well.

 

The new bandwidth could also be used to one day expand its service provider business. In the U.S., Google has recently launched its Google Fiber service in several towns, which offers 1Gbps Internet as well as TV packages. The online giant purchased large amounts of "dark," or unused fiber in the U.S. over the last decade.

 

The fiber project may also expand to link to Thailand, bringing its total length to 9,700 kilometers.

 

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China Box Office: 'Man of Steel' Drops to No. 2 as Local Film 'Tiny Times' Swoops In

HONG KONG – What does it take to bring Superman to ground? What angry birds or war planes couldn’t do, a teen-oriented rite-of-passage drama did – as Man of Steel was thrown off the top in mainland China’s daily box-office rankings just a week into its release there.

Having been locked in a neck-and-neck struggle with the Jet Li-starring action film Badges of Fury in the past few days, Man of Steel finally surrendered its shaky grip atop the earnings rankings Thursday upon the release of Tiny Times, writer-turned-filmmaker Guo Jingming’s adaptation of his own novel about four young women’s glitzy passages to adulthood in Shanghai.

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According to figures accumulated by entertainment industry analysts Entgroup, Tiny Times broke the Chinese opening-day record for a solely 2D release by taking $11.2 million (69 million yuan) on Thursday, with the film having already taken $1.2 million (7.3 million yuan) in sneak previews held the previous day.

Man of Steel, which averages tickets of $6.65 (41 yuan) per head across the country, took $2 million (12.3 million yuan), with its total earnings now standing at $37 million (228 million yuan). Badges of Fury – which was also a 2D-only movie, with average ticket prices standing at $5 (31 yuan) – came in third Thursday on $1.75 million (10.8 million yuan), taking its total earnings to $25.7 million (158.4 yuan).

The revenue trends on Thursday have led to a drastic increase in the number of screenings of Tiny Times. Entgroup’s statistics have revealed the film as taking up more than half of all shows across China on Friday – that’s more than 30,000 for the day – with Badges of Fury and Man of Steel securing only about 18 percent and 16 percent of screenings, respectively. Shanghai, Beijing and Guangzhou remained the three cities still giving Clark Kent more than one-fifth of its screenings.

But the backlash has already begun for Tiny Times, with its staggering ticket sales running contrary to the mauling it received online – the film averaged ratings of 3.4 and 5.0 out of 10 on mtime.com and douban.com, two of China’s most-visited movie portals.

STORY: Chinese Coming-of-Age Drama 'Tiny Times' Eyeing Huge Local Debut

Commentators have frowned on how the film’s emphasis on glamorous lifestyles have rendered the whole premise vacuous, with seasoned critic Zhou Liming going to the extremes of writing on his miniblog about how the “flaunting of wealth in the film has reached pathological levels” – a comment that has led to him being barracked by hate tweets. The Southern Metropolis Daily, one of the country’s most influential newspapers, reported of viewers exiting screenings describing the film as being “pretentious” and “only suitable for high school students.”

Speaking to The Hollywood Reporter in Shanghai last week, Guo said his film is made with China’s new “me generation” in mind, that “these days it’s all about looking after myself – saying, ‘I want to enjoy life the way I like it.'” The director reiterated the point to the Chinese press after the film’s launch in Beijing on Thursday, saying how “a film couldn’t satisfy everyone, and I have never wanted to make a film suited for both the old and the young.”

 

Obama jabs Russia, China on failure to extradite Snowden

DAKAR - U.S. President Barack Obama said on Thursday he would not start "wheeling and dealing" with China and Russia over a U.S. request to extradite former American spy agency contractor Edward Snowden.

Obama, who appeared concerned that the case would overshadow his three-country tour of Africa begun in Senegal, also dismissed suggestions that the United States might try to intercept Snowden if he were allowed to leave Moscow by air.

"No, I'm not going to be scrambling jets to get a 29-year-old hacker," he told a news conference in Dakar, a note of disdain in his voice. Snowden turned 30 last week.

Obama said regular legal channels should suffice to handle the U.S. request that Snowden, who left Hong Kong for Moscow, be returned to the United States.

He said he had not yet spoken to China's President Xi Jinping or Russian President Vladimir Putin about the issue.

"I have not called President Xi personally or President Putin personally and the reason is ... number one, I shouldn't have to," Obama said sharply.

"Number two, we've got a whole lot of business that we do with China and Russia, and I'm not going to have one case of a suspect who we're trying to extradite suddenly being elevated to the point where I've got to start doing wheeling and dealing and trading on a whole host of other issues."

Snowden fled the United States to Hong Kong in May, a few weeks before publication in the Guardian and the Washington Post of details he provided about secret U.S. government surveillance of Internet and phone traffic.

The American, who faces espionage charges in the United States and has requested political asylum in Ecuador, has not been seen since his arrival in Moscow on Sunday. Russian officials said he was in a transit area at Sheremetyevo airport.

A Russian immigration source close to the matter said Snowden had not sought a Russian visa and there was no order from the Russian Foreign Ministry or Putin to grant him one.

CHARGES OF U.S. HYPOCRISY

Snowden's case has raised tensions between the United States and both China and Russia. On Thursday, Beijing accused Washington of hypocrisy over cyber security.

Obama's remarks in Senegal seemed calibrated to exert pressure without leading to lasting damage in ties with either country.

"The more the administration can play it down, the more latitude they'll have in the diplomatic arena to work out a deal for him (Snowden)," said Andy Smith, director of the University of New Hampshire Survey Center.

Obama indicated that damage to U.S. interests was largely limited to revelations from Snowden's initial leak.

"I continue to be concerned about the other documents that he may have," Obama said. "That's part of the reason why we'd like to have Mr. Snowden in custody."

Still, Snowden's disclosures of widespread eavesdropping by the U.S. National Security Agency in China and Hong Kong have given Beijing considerable ammunition in an area that has been a major irritant between the countries.

China's defense ministry called the U.S. government surveillance program, known as Prism, "hypocritical behavior."

"This 'double standard' approach is not conducive to peace and security in cyber space," the state news agency Xinhua reported, quoting ministry spokesman Yang Yujun.

In Washington, the top U.S. military officer dismissed comparisons of Chinese and American snooping in cyber space.

"All nations on the face of the planet always conduct intelligence operations in all domains," Army General Martin Dempsey, the chairman of the Joint Chiefs of Staff, told an audience at the Brookings Institution.

"China's particular niche in cyber has been theft and intellectual property." Dempsey said. "Their view is that there are no rules of the road in cyber, there's nothing, there's no laws they are breaking, there's no standards of behavior."

In Ecuador, the leftist government of President Rafael Correa said it was waiving preferential rights under a U.S. trade agreement to demonstrate what it saw as its principled stand on Snowden's asylum request.

Correa told reporters Snowden's situation was "complicated" because he has not been able to reach Ecuadorean territory to begin processing the asylum request.

"In order to do so, he must have permission of another country, which has not yet happened," Correa said.

In a deliberately provocative touch, Correa's government also offered a multimillion dollar donation for human rights training in the United States.

The U.S. State Department warned of "grave difficulties" for U.S.-Ecuador relations if the Andean country were to grant Snowden asylum, but gave no specifics.

"USEFUL" CONVERSATIONS

Obama said the United States expected all countries that were considering asylum requests for the former contractor to follow international law.

The White House said last week that Hong Kong's decision to let Snowden leave would hurt U.S.-China relations. Its rhetoric on Russia has been somewhat less harsh.

Putin has rejected U.S. calls to expel Snowden to the United States and said the American should choose his destination and leave the Moscow airport as soon as possible.

Obama acknowledged that the United States did not have an extradition treaty with Russia, but said such a treaty was not necessary to resolve all of the issues involved.

He characterized conversations between Washington and Moscow as "useful."

Washington is focused on how Snowden, a former systems administrator for the contractor Booz Allen Hamilton, gained access to National Security Agency secrets while working at a facility in Hawaii.

NSA Director Keith Alexander on Thursday offered a more detailed breakdown of 54 schemes by militants that he said were disrupted by phone and internet surveillance, even as the Guardian newspaper reported evidence of more extensive spying.

In a speech in Baltimore, Alexander said a list of cases turned over recently to the U.S. Congress included 42 that involved disrupted plots and 12 in which surveillance targets provided material support to terrorism.

The Guardian reported that the NSA for years collected masses of raw data on the email and Internet traffic of U.S. citizens and residents, citing a top-secret draft report on the program prepared by NSA's inspector general.

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28Tbps undersea fiber backed by Google, China Telecom, NEC goes live

An 8,900 kilometer undersea fiber cable system in Asia, backed by a consortium including Google, China Telecom, NEC and a host of local telecommunications companies, went live Thursday.

The Southeast Asia-Japan Cable (SJC) system has an initial capacity of 28Tbps and connects China, Hong Kong, the Philippines, Singapore and Brunei with Japan and its link to transpacific fiber that runs to the U.S. The project will provide the lowest latency connection from Singapore to Los Angeles, said its main supplier, Japan's NEC.

The project was first announced in 2009 and construction started in April of 2011. Total costs were about US$400 million. NEC said the cable system consists of six fiber pairs that can carry the equivalent of 3 million HD video streams at the same time.

The majority of the investors in the project are large telecommunications providers and mobile operators that operate in the countries that were connected. In addition to China Telecom, these include China Mobile, Hong Kong's Donghwa Telecom, Globe in the Philippines, SingTel, and TOT in Thailand.

Google is an exception. Its share in the project could be used to link up its three massive new Asian data centers and connect them to its U.S. presence. In September 2011, Google acquired 15 hectares (150,000 square meters) in Taiwan to construct a facility that is to go live this year. It also said it acquired smaller plots in Hong Kong and Singapore that month to build data centers in those countries as well.

The new bandwidth could also be used to one day expand its service provider business. In the U.S., Google has recently launched its Google Fiber service in several towns, which offers 1Gbps Internet as well as TV packages. The online giant purchased large amounts of "dark," or unused fiber in the U.S. over the last decade.

The fiber project may also expand to link to Thailand, bringing its total length to 9,700 kilometers.

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China urged to end forced resettlements in Tibet

A Tibetan boy and man sit on a street next to the Dzamthang Jonang monastery in Barma township
BEIJING - A human rights group appealed to China on Thursday to end what it called forced "mass rehousing and relocation" of ethnic Tibetans that it said had uprooted more than two million people in the past seven years.

The report, by New York-based Human Rights Watch, said Chinese authorities threw lives into disarray by denying rights to forcibly relocated ethnic Tibetans with insufficient compensation, sub-par housing and lack of help in finding jobs.

"The scale and speed at which the Tibetan rural population is being remodeled by mass rehousing and relocation policies are unprecedented in the post-Mao era," said Human Rights Watch China Director Sophie Richardson.

"Tibetans have no say in the design of policies that are radically altering their way of life, and - in an already highly repressive context - no ways to challenge them."

More than two million Tibetans had been relocated in Tibet since 2006, as have hundreds of thousands of nomadic herders in the eastern part of the Tibetan plateau such as in Qinghai province, the report said.

The program's aim, it added, was to help economically, but also to combat separatist sentiment "and is designed to strengthen political control over the Tibetan rural population".

Phone calls to the Tibet autonomous region government office seeking comment were not answered.

CHINA DEFENDS DEVELOPMENT POLICY

Foreign ministry spokeswoman Hua Chunying said she hoped those issuing the report could "remove their colored glasses" in terms of China's achievements in development policy.

Those examining Chinese policy, she told a news briefing, "should have a correct understanding of China's ethnic and religious policies and respect for the Chinese people's chosen path of development".

Violence has flared in Tibet since 1950, when Beijing says it "peacefully liberated" the region. Many Tibetans say Chinese rule has eroded their culture and religion and agitate for the return of their spiritual leader the Dalai Lama, who fled into exile in 1959 after an abortive uprising against Chinese rule.

The Chinese government, which brands the Dalai Lama a dangerous "splittist", denies trampling on Tibetan rights and says it brought prosperity to the region and ended serfdom.

Since 2009, at least 117 Tibetans have committed acts of self-immolation in China in protest against Beijing's policies. More than 90 have died.

But in a possible sign of a loosening of some restrictions, authorities in Tibetan-populated areas of Qinghai and Sichuan provinces are allowing monks to respect the Dalai Lama as a religious leader, though not as a political figure, Radio Free Asia said.

While the move appears limited to Sichuan and Qinghai, it contradicts the long-time policy of prohibiting veneration of the Dalai Lama, Radio Free Asia said, citing sources who in turn cited official documents introducing the experimental policy.

When asked about the report, Hua said she was unaware of the specific situation. She reiterated Beijing's stance that the Dalai Lama was "not a purely religious figure" and had long used religion to "engage in anti-China separatist activities".

The Dalai Lama denies he is a separatist and says he is merely seeking greater autonomy for his homeland.

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China, South Korea push for North Korea talks

BEIJING - China's president welcomed his South Korean counterpart on Thursday as an "old friend of China" and agreed to make a push for new talks with North Korea on Thursday as two of Asia's newest leaders met for the first time.

Park Geun-hye, one of Asia's few women leaders, took office in Seoul in February amid war threats by North Korea, while China's Xi Jinping was appointed in November and has sought to rein in the North's nuclear weapons program, backing tougher economic sanctions against Beijing's traditional ally.

"The two leaders shared a common view on denuclearizing North Korea, maintaining peace and stability on the Korean peninsula and resolving issues through dialogue and negotiations," Park's office said in a statement after they met.

China backed North Korea in the 1950-53 Korean War with late leader Mao Zedong's eldest son dying in the conflict with the South. The 60th anniversary of the end of the war is July 27.

Beijing is the main economic and diplomatic lifeline for the impoverished and isolated state, whose three nuclear weapons tests since 2006 have threatened Asia's security.

China has boosted sanctions on its ally, which this year conducted a nuclear test in defiance of international criticism. It has also closed access for North Korean banks in China.

Xi was appointed Communist Party chairman, China's most powerful position, last November and named president in March.

In April, he told an international forum in southern China that no country "should be allowed to throw a region and even the whole world into chaos for selfish gain".

While Xi did not name North Korea, his comment came amid the highest tension on the peninsula in years, with daily threats from Pyongyang to attack South Korea and the United States.

Xinhua, China's state news agency, appeared to criticize Pyongyang ahead of the visit, saying that "hard-earned trust among concerned parties has been evaporating following unfortunate incidents one after another" since 2009.

In 2009, the North walked out of denuclearization talks brokered by China, carried out its second nuclear test and in 2010 was accused of sinking a South Korean naval vessel and shelling a South Korean island.

ASIAN ECONOMIC POWERHOUSES

China, Asia's largest economy, consumes 15 percent of South Korean exports in annual trade worth $215 billion. North Korea's puny economy trades just $6 billion with China.

Park, 61, was accompanied by a hefty economic delegation from South Korea's huge industrial conglomerates, including the world's largest electronics company, Samsung Electronics Co Ltd, and Hyundai Motor Co. .

The two countries' central banks extended a currency swap for 64 trillion Korean won ($55.44 billion) or 360 billion yuan, as part of a defense against financial market instability.

Unlike a military delegation sent by North Korea last month that featured aged generals bedecked with medals, Park appeared to get an enthusiastic welcome from her hosts.

"Park Geun-hye visits China" was the most searched financial and economic topic on Weibo, China's version of Twitter.

In response to an interview with Park by state broadcaster CCTV, one microblogger, Christumn, said: "I am already her fan".

By contrast, North Korean leader Kim Jong-un is derided on some Chinese social media sites as "Fatty Kim".

Stylish and mild mannered, Park arrived with self-taught Mandarin skills, and received a warm welcome from state media for a trip she described as "a journey to deepen the mind and trust" between the two countries.

"The visit, which comes months after both countries saw leadership change, is expected to open a new chapter in bilateral relations," Xinhua said.

Park is to deliver an address at Tsinghua University, Xi's alma mater, on Saturday and visit the ancient capital of Xi'an, the site of major South Korean investment, including a $7 billion chip complex by Samsung Electronics.

Park, whose mother was killed by a North Korean-backed assassin, got a guarded welcome from ethnic Koreans in China.

"I feel thankful for South Korea. Its economy has grown to become one of Asia's four dragons and expanded in China... But on the other hand we want North Korea to live well," said Li Jung-ae, 49, who has a PhD in finance from Tsinghua University. ($ = 1154.5000 Korean won)

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Confrontation over the South China Sea 'doomed', China tells claimants

BEIJING - Countries with territorial claims in the South China Sea that look for help from third parties will find their efforts "futile", China's Foreign Minister Wang Yi warned on Thursday, adding that the path of confrontation would be "doomed".

Beijing's assertion of sovereignty over a vast stretch of the South China Sea has set it directly against Vietnam and the Philippines, while Brunei, Taiwan and Malaysia also lay claim to other parts of the sea, making it Asia's biggest potential military troublespot.

At stake are potentially massive offshore oil reserves. The seas also lie on shipping lanes and fishing grounds.

Wang didn't name any third countries, but the United States is a close ally of Taiwan and the Philippines, and has good or improving relations with the other nations laying claim to all or part of the South China Sea.

"If certain claimant countries choose confrontation, that path will be doomed," Wang said after a speech at the annual Tsinghua World Peace Forum.

"If such countries try to reinforce their poorly grounded claims through the help of external forces, that will be futile and will eventually prove to be a strategic miscalculation not worth the effort."

The Philippine military said this week it had revived plans to build new air and naval bases at Subic Bay, a former U.S. naval base that American forces could use to counter China's creeping presence in the South China Sea.

Wang's comments came days before the minister is due to attend a meeting of foreign ministers of the Association of Southeast Asian Nations grouping in Brunei from Saturday to Tuesday.

The 10-member ASEAN hopes to reach a legally binding Code of Conduct to manage maritime conduct in disputed areas. For now a watered-down "Declaration of Conduct" is in place.

The path to a Code of Conduct will be slow and deliberate, Wang said, adding that the Declaration of Conduct was a commitment made by China and the 10 ASEAN countries and China would continue to abide by it.

"The right way is to fully implement the Declaration, and in this process, move forward with the Code in a gradual way," Wang said.

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China canal project in Nicaragua has investors

Nicaraguan President Daniel Ortega and Wang Jing of HKND Group.

Telecom executive Wang Jing told reporters in Beijing that work should start on the canal by the end of 2014 and finish within six years.

Lawmakers in Nicaragua granted a 50-year concession earlier this month to Wang's privately held HKND Group to build the canal, which will stretch three times the distance of its Panamanian counterpart.

The proposed passage through Nicaragua would be wider that the Panama Canal, and could leave the country well placed to capitalize on a predicted rise in global shipping over the next 20 to 30 years.

Even with its current expansion, the Panama Canal will still be too small to accommodate the world's largest container ships.

In addition to the canal, HKND has won rights to build a railroad, two ports, an international airport and an oil pipeline.

It is not clear how the group intends to finance the canal's construction, which carries a reported price tag of $40 billion.

Wang said Tuesday that fundraising is "going very well so far." But he declined to name any investors, saying instead that more information will be provided "when the project reaches different phases."

Nicaragua has long attracted ambitious businessmen, politicians and governments hoping to build a canal. So far, all efforts have fallen victim to a lack of funding or the country's complicated politics.

Related story: China and Europe risk trade war

Many observers are deeply skeptical of the project's viability. Wang has no apparent experience with large infrastructure projects, and little is know about HKND's governance structure.

Wang denied any ties to the Chinese government or military on Tuesday, saying the project is entirely independent. Pressed about his background, Wang said that he studied Chinese medicine before pursuing a career in business.

"I am an average Chinese citizen," the CEO said.



T.L. Yip, an assistant professor at Hong Kong Polytechnic University, said that the project is technically viable and not unrealistic.

Beijing is eager, Yip said, to secure energy supplies, and a canal in Nicaragua would provide an additional avenue for trade between China and key trading partners like South Africa.

"From China's point of view, they would like to see an alternative to the Panama Canal," Yip said. "This could be very important for Beijing."

President Daniel Ortega and his Sandinista government have portrayed the project as an economic boon for Nicaragua, which is the poorest country in Central America and second poorest in the Western Hemisphere. The country is highly indebted and unemployment is rampant.

Ortega faces domestic opposition over the project. The Movement for Nicaragua, a coalition of community groups, has already objected to the proposed construction.

"Nicaragua isn't for sale. Nicaragua belongs to all Nicaraguans and isn't the private property of Ortega and his family," the group said in a statement.

 

China targets shadow bankers in credit squeeze

China's central bank is applying pressure to the country's shadow banking system.

Beijing's tactics are designed to crack down on the banks, securities dealers and underground operators that make up the country's flourishing shadow banking system.

The government's concern is that lending has grown too big, too fast, and it hopes higher rates will restrain that expansion. At the same time, the fear among investors is that the lending crackdown could slow the economy more than expected.

In recent years, shadow banks have carved out a niche trade in China. They offer loans to small and medium-sized companies that are ignored by large state-run banks. Often, the loans are packaged and sold to investors looking for higher returns.

In many cases, the shadow lenders provide a valuable service -- offering capital for run-of-the-mill projects that would otherwise go unfunded.

This is no small operation. The shadow banking sector's exact reach is unknown, but the Fitch ratings agency estimates its size has reached roughly 60% of China's GDP.

But Beijing is now worried that credit is becoming inefficient, increasingly dominated by unregulated lenders and reaching a scale where it could sap growth.

By allowing rates to rise, the central bank is signaling that the era of easy credit -- which has helped spur shadow banks -- is over.

The central bank last week allowed the rate at which Chinese banks lend to each other to hit a record high above 13%. Another key measure of cash in the banking system -- the seven-day "repo rate" -- peaked at 25%.

Under normal circumstances, the central bank would have moved quickly to provide liquidity and lower rates. But the bank stood idly by as investors grew increasingly nervous over the bank's inaction and lack of guidance. The unease manifested in equity markets, which were battered as rates increased.

Some clarity emerged over the weekend, when official state media reported that the China's shadow banking system was indeed the central bank's target.

"It's not that there's no money," a Xinhua commentary said. "It's that the money is not in the right places."

Related story: In China, a little bit of financial chaos is just fine

The decision not to jump in and push down borrowing rates for financial institutions is seen as a way to force them to get back to traditional banking. Beijing had recently issued warnings to its banks to avoid risky loans and excessive expansion of credit.

The central bank broke its silence on Monday, indicating that its harsh medicine is likely to continue.

"Commercial banks must pay close attention to the liquidity situation in the market and must strengthen their analysis and forecasts of factors affecting liquidity," the central bank said in a note posted Monday but dated June 17.

Related story: Is China's debt: a crisis in the making?

The bank elaborated after a wild day of trading on Tuesday, going so far as to hold a press conference and issue a pledge to keep lending rates at a reasonable level.

Mark Williams, chief Asia economist at Capital Economics, said in a research note Monday that the central bank's efforts to rein in credit were the strongest sign yet that China's leadership is "willing to suffer short-term economic pain if necessary to achieve more sustainable growth."

But Williams also said the lack of communication from the central bank was troublesome.

"By most standards, the behavior of the People's Bank over the last couple of weeks has been extraordinarily reckless," he said. "It did not intervene as interbank rates spiked to extreme levels, despite having the tools to do so, and it offered no explanation for its inaction."

Mexico eyes China as new tequila market

Some high-end tequilas such as Jose Cuervo, Herradura, Patron and Don Julio will be largely launched in Beijing, Shanghai and Hong Kong by the end of the year.

The two countries agreed to increase tequila imports from Mexico when their presidents met earlier this month.

"We are expecting to export 10 million liters of tequilas to China in five years, and make China the second largest market after the United States," said Francisco Soltero Jimenez, general manager of Mexico's national tequila industry association.

Until recently, China restricted imports of foreign liquor that exceed 2 grams of methanol per liter, citing harmful health effects. Most high-quality tequila -- made with 100% agave -- contains more methanol than the limit. Consequently, high-grade tequilas have been largely unavailable to Chinese drinkers.

Last year, Mexican tequila makers exported 410,000 liters of lower agave tequila into China.

But China recently reassessed tequila's risks and found that tequilas with more than 2 grams of methanol per liter don't pose any harmful health effects.

Mexico currently exports tequila to more than 100 countries, but nearly 80% goes to the United States, according to Mexico's national tequila industry association.

China consumes 5 billion liters of spirits every year, led by cognac, whiskey and vodka. Drinking has been a long-standing part of Chinese culture, especially during business banquets. And tequila's flavor profile is similar to traditional Chinese wine, a strong drink.

Related: Tequila! But not for spring breakers

Looking for new growth opportunities, Mexican producers are studying the spirits, culture and customs of the nearly 300 million Chinese upper-middle class consumers.

"We will have more promotions in Beijing, Shanghai and Hong Kong," Jimenez said. "Some high-end tequila such as Jose Cuervo, Herradura, Patron and Don Julio will be largely launched in China by the end of the year," he said.

The 100% agave-based tequila will cost approximately $40 to $60 per bottle including import tax, according to Jimenez.

In the long run the tequila market in China could be even larger than in the United States because there are more Chinese with disposable incomes, said Christopher Shanahan, food and agriculture manager at Frost & Sullivan, a U.S. marketing analysis firm.

Tequila makers are trying to encourage China's growing new rich to buy the alcohol by leveraging its mystique and novelty, Shanahan said.

"There has been significant growth in food services and restaurant sales on top of grocery sales in China," Shanahan said. "And the Chinese market likes foreign prestige brands. These are indicators that tequila will be popular in China."

Major foreign brands that have launched in China almost all experienced significant growth, Shanahan said.

"Chinese consumers want to spend money on luxurious and unique foreign products to increase their social standings in a fashionable way. Tequila is one of many products that will become part of the equation," Shanahan said.