British Prime Minister David Cameron laid a wreath at Jallianwala Bagh in India’s northwestern city of Amritsar on Wednesday where hundreds of Indians were massacred by colonial forces in 1919, calling the act ‘’a shameful event in British history”.
Britain’s prime minister laid a mourning wreath Wednesday at the site of a notorious 1919 massacre of hundreds of Indians by British colonial forces, calling the killings ‘’a shameful event in British history.”
David Cameron was the first British prime minister to make a gesture of condolence at Jallianwala Bagh in the northwest city of Amritsar, but stopped short of issuing a formal apology for his country’s actions 94 years earlier.
‘’This is a deeply shameful event in British history – one that Winston Churchill rightly described at the time as ‘monstrous,” Cameron wrote in the visitors’ book at the site. ‘’We must never forget what happened here. And in remembering we must realize that the United Kingdom stands for the right of peaceful protest around the world.”
The park was the site of an attack by British colonial troops on unarmed Indians attending a rally calling for independence. More than 300 Indians were killed during the massacre, which galvanized the national independence movement and marked the beginning of the end of Britain’s rule over the Indian subcontinent.
Queen Elizabeth II visited the same site in 1997 and laid a wreath there. She called the killings ‘’distressing.”
Cameron’s visit to Amritsar came at the end of his trip to India. The trip was aimed at boosting trade and investment between the two countries in the areas of energy, infrastructure, insurance, banking and retail.
Thursday, February 28, 2013
Wednesday, February 27, 2013
KFC unveils tighter quality control in China to rebuild battered brand after poultry scandal Read more: http://www.foxnews.com/world/2013/02/24/kfc-unveils-tighter-quality-control-in-china-to-rebuild-battered-brand-after/#ixzz2M7icOkBa
BEIJING – KFC has unveiled new quality control measures in China in an effort to rebuild its battered brand after a scandal over misuse of antibiotics by its suppliers to fatten poultry.
KFC said Monday it will strengthen oversight of its suppliers and expand drug testing. It said more than 1,000 small producers used by the company's 25 poultry suppliers have been eliminated from its network.
The company, owned by Yum Brands Inc., says sales in China might fall by as much as 25 percent in the current quarter after state television reported in December that poultry suppliers were using excessive levels of antibiotics to fatten chickens.
KFC is China's biggest fast-food chain with more than 4,000 outlets. China accounts for about 40 percent of KFC's profit.
Bank of East Asia Says China Rate Cuts Weighed On Results
Bank of East Asia's overall net profit up 39%
- Bank of East Asia saw Chinese loan quality deteriorate last year
- The bank's China unit posted a mild drop in pretax profit as interest margins narrowed
HONG KONG--Hong Kong's Bank of East Asia Ltd. (0023.HK) said Tuesday profit at its mainland China operations fell slightly last year as Beijing's interest rate cuts ate into its margins.
The fifth-largest local lender in Hong Kong has the largest China exposure among its peers and is the second-largest foreign bank in China with more than 100 outlets in the country, just after HSBC Holdings PLC. Though its overall net profit rose 39% thanks to buoyant financial markets, its thinner margins in China were accompanied by a rise in bad debt, reflecting the risk of deteriorating credit quality in the world's second-largest economy.
"Interest margins in China were challenging last year, because the People's Bank of China cut interest rates and injected liquidity into the banking system," said Brian Li, Bank of East Asia's deputy chief executive. Mr. Li said interest margins started to stabilize at the end of last year.
Pretax profit at the bank's China unit fell 5% to 2.25 billion Hong Kong dollars (US$290 million) in the year ended Dec. 31, from HK$2.37 billion in 2011. During the same period, the bank's impaired loans in China doubled to HK$453 million from HK$216 million, while loans overdue by more than three months jumped to HK$375 million from HK$21 million.
Mr. Li said the bad loans were concentrated in Zhejiang province, where unpaid loans surged last year. Wenzhou, a city in the eastern Chinese province that is home to many export-oriented businesses, was particularly hard hit by weakening global demand.
"Bad loans might still be popping up in the first half of this year. But it is well under control and won't cause material problems to the bank," he said.
Banking analyst Daniel Tabbush at the Tabbush Report said Bank of East Asia's bad loans rose 44% in the second half of last year compared with the first half. "(That) confirms the worsening credit metrics in China," he said.
The bank said its impaired loan ratio rose to 0.27% in the six months ended December, from 0.18% during the first half of 2012.
Bank of East Asia's net profit last year jumped 39% to HK$6.06 billion from HK$4.36 billion a year earlier, as rosier equity and bond markets drove its gains from trading and financial assets. The result was above the average HK$4.94 billion forecast of 11 analysts polled by Thomson One.
Spanish lender CaixaBank S.A. owns 16.38% of Bank of East Asia, while Guoco Group Ltd., a conglomerate controlled by Malaysian tycoon Quek Leng Chan, has a 14.34% stake. Japan's Sumitomo Mitsui Banking Corp. also owns 9.5% of the Hong Kong lender.
China's Loose Policy Ending, Newspaper Says
China's recent loose monetary policy is coming to an end, said an editorial in the China Securities News published Tuesday.
Liquidity conditions have been looser than expected since Chinese New Year, the paper said.
But the People's Bank of China isn't likely to adjust interest rates or reserve requirements in the short term, the paper said. Instead, the main mechanism for transmitting policy is likely to be bond purchases and sales by the central bank, known as open market operations.
The paper didn't claim insider knowledge on the outlook for monetary policy, but its commentaries on policy are generally highly regarded in the market, having correctly predicted policy moves in the past.
The PBOC hasn't made any changes to interest rates since they were cut in July 2012, relying on open market operations to control the amount of liquidity in the financial system.
The PBOC will be reluctant to tighten conditions too drastically because of the huge levels of financing required for the country's urbanization drive, the China Securities News said. China's incoming leadership is expected make urbanization a centerpiece of its policy agenda.
It is important to build up multiple financing channels in addition to bank loans, the paper said, such as allowing local governments to issue municipal bonds.
Yum cutting some supplier ties after China food scare
BEIJING – Yum Brands Inc said on Monday it will stop using more than 1,000 slaughterhouses in China as it moves to tighten food safety and reverse a sharp drop in business at KFC restaurants in its top market after a scare over contaminated chicken.
Diners began avoiding Kentucky-based Yum's nearly 5,300, mostly KFC, restaurants in China in December after news reports and government investigations in the Asian country focused on chemical residue found in a small portion of its chicken supply.
Yum was not fined by Chinese food safety authorities, but its restaurant sales in the country dropped and have yet to recover. As a result, Yum warned this month that it expected 2013 earnings per share to contract, rather than grow.
Yum said it would end ties with smaller chicken suppliers that have not modernized their operations.
"This is a public problem. Even though China has rules on use of additive products, we very much regret that some people still operated while breaking those rules," Yum China Chairman and Chief Executive Sam Su told a news conference in Beijing.
Su declined to give specifics on other efforts to shore up the safety of the company's food supply in China or its plans to lure diners back.
Yum gets more than half of its overall sales from China, the world's fastest-growing major economy.
The scandal has been a blow to the company, which has a reputation for serving safe, high-quality meals in China, where food contamination is a chronic problem.
"This is going to be quite a management task for (Yum) in terms of their reputation," said David Mahon, managing director of Mahon China, an investment management company that advises multinational companies that operate in the Asian country.
"I think they'll put a lot of effort into closing suspect suppliers and bringing better standards and proving to consumers that they're doing so," Mahon said.
Ultimately, the Chinese government is responsible for setting and enforcing better food safety standards, he said.
Yum Chief Executive David Novak said early this month that time, not money, is the cure for the company's China sales drop.
Based on the company's experience with prior sales-damaging crises related to Severe Acute Respiratory Syndrome (SARS), avian flu and "Sudan Red" dye, Yum said it does not expect restaurant sales there to turn higher until the fourth quarter.
Shares in Yum closed down 1.1 percent at $64.73 on the New York Stock Exchange on Monday.
China May Allow Foreign Banks to Distribute Local Fund Managers' Products - Source
China may soon allow foreign banks to distribute products for domestic fund management companies, in a long-anticipated move that will offer foreign lenders access to a lucrative and fast-growing market in the country.
"As early as next month, China's securities regulator is expected to unveil amended guidelines that will effectively make foreign banks eligible to tap the domestic fund distribution market," a person with direct knowledge of the matter told Dow Jones Newswires Tuesday.
That will give foreign banks entry into a fast-growing niche in the world's second-largest economy. China's 72 fund-management companies managed 3.62 trillion yuan ($575.8 billion) as of the end of last year, 31% more than a year earlier.
Major foreign banks operating in China, including Citigroup Inc.'s (C) Citibank, Standard Chartered PLC (STAN.LN) and United Overseas Bank Ltd. (U11.SG) have already submitted applications to the regulator, the person said.
The Shanghai Branch of China Securities Regulatory Commission said Monday in a statement posted on its website that it has received the applications of these three banks.
Standard Chartered said in an email the bank will "prepare for the business under requirements of the regulator." A Citibank official in China declined to confirm its application. UOB didn't immediately respond to queries.
The anticipated change will help foreign banks expand their currently small customer bases in a tightly-controlled sector, but the new business is unlikely to contribute meaningfully to revenue.
The move is also part of Beijing's efforts to introduce a broader variety of participants into the country's fund management distribution market, which has been dominated by major state-owned lenders for years.
Observers say the de facto monopoly by the big state-owned banks with vast distribution networks and deep pools of retail deposits have pushed up costs for fund investors.
China first amended the guidelines aimed at allowing foreign banks to distribute fund management products two years ago, after Beijing made a commitment to do so at the third Sino-U.S. Strategic and Economic Dialogue, a high-profile meeting between officials of China and the U.S.
However, none of the foreign banks in China has so far succeeded in meeting the existing guidelines, which contain strict criteria and virtually insurmountable hurdles such as a record clean of administrative penalties for three consecutive years.
As part of easing restrictions on foreign banks, the securities regulator will change the guidelines to allow foreign banks with no record of "significant" administrative penalties for three years in a row to distribute fund management products, said the person with direct knowledge of the matter.
Many major foreign banks in China will meet this adjustment, the person added.
With their dominance of the market, Chinese state-owned banks enjoy strong bargaining power and their distribution charges account for an average of a fifth of a fund manager's total management fees to investors, analysts say.
In a bid to introduce more competition into the market, the securities regulator has in recent years brought in more players, including independent fund sale institutions, in addition to banks, securities firms and fund houses. As of the end of last year, 65 banks, 96 securities companies, five securities investment advisers and 14 independent fund sale institutions hold distribution licenses.
Tuesday, February 26, 2013
Deadly explosion hits crowded market in southern India
Two bombs placed on bicycles exploded in a crowded market-place in the southern Indian city of Hyderabad on Thursday, and the federal home minister said at least 11 people were killed and 50 wounded.All major cities in the country were placed on high alert, television channels said, adding that as many as 15 people may have been killed in the explosions.
Hyderabad is a major IT centre in India, only second to Bangalore. Microsoft and Google have major centres in the city.
“Both blasts took place within a radius of 150 metres,” federal Home (Interior) Minister Sushil Shinde told reporters, adding the explosives were placed on bicycles parked in the crowded marketplace. “Eight people died at one place, three at the other.”
The explosions come less than two weeks after India hanged a Kashmiri man for a militant attack on the country’s parliament in 2001 that had sparked violent clashes.
Witnesses told Reuters they heard at least two explosions in the Dilsukh Nagar area of Hyderabad just after dusk but there could have been more.
TV showed debris and body parts strewn on the street in the area, a crowded neighbourhood of cinema halls, shops, restaurants and a fruit and vegetable market.
Prime Minister Manmohan Singh called it a “dastardly attack”.
“I appeal to the public to remain calm and maintain peace,” he said in a Twitter message.
In July 2011, three near-simultaneous blasts ripped through India’s financial capital, Mumbai. At least 20 people were killed and over 100 wounded in the blasts set off by Muslim militants, authorities said.
Last year, four small explosions occurred in quick succession in a busy shopping area of the western Indian city of Pune.
SOUTH-EAST ASIA / OCEANIA: 43 Countries Agree On Battle Against Human Trafficking
Foreign ministers of 43 countries have agreed on a regional framework to fight human trafficking in the Asia-Pacific region.The framework was a
significant step even though it was non-binding, said Indonesian Foreign
Minister Marty Natalegawa, because it took into consideration the
interests of the victims' countries of origin, transit and destination,
the Jakarta Globe newspaper reported."This will allow a more
effective channel for interested parties to work together to combat
people-trafficking networks in the region," said Mr Natalegawa, who
co-chaired the Bali Process meeting with his Australian counterpart
Kevin Rudd.One billion people in the
world is involved in some form of migration, with 41 million being
forcibly moved and 15.9 million being displaced, said Mr Rudd.The Bali Process, a framework
resulting from a human trafficking conference nine years ago, calls for
greater cooperation between Indonesia and Australia to fight human
smuggling, including both countries sharing intelligence, the paper
said.Australia is a popular
destination for illegal migrants from conflict-ridden countries, who
usually use Indonesia as a transit point before entering Australia by
boat.
Egypt: Balloon crashes near Luxor killing 19 tourists
The balloon was at 300m (1,000ft) when it caught fire and plunged into fields west of the ancient city. At least two people, including the balloon's pilot, are reported to have jumped out of the balloon before it crashed. Officials in Luxor say they have now banned all hot air balloon flights.The UK Foreign Office said that two British nationals and one British resident had died. One of them was said to have undergone five hours of surgery in an effort to save his life, but died of his injuries. Another Briton is in a stable condition in hospital.The next of kin have been informed and our thoughts are with them and their families at this difficult time. We are providing them with consular assistance," it said in a statement.The dead also included nine Hong Kong tourists, four from Japan, two French, one Hungarian and an Egyptian, Egypt's health ministry said.
The Chinese and Japanese embassies in Cairo, and the French foreign ministry, also confirmed that their nationals were among those killed. The Hungarian is understood to have been the British resident who died.
The pilot, who is being treated for burns, survived by jumping when the balloon was just 10-15m (33-49ft) above ground, a local ballooning official told Reuters news agency.
Luxor lies on the banks of the River Nile in the south of the country, and has long been a popular tourist destination.
It is home to some of Egypt's most famous ancient ruins, with the temples of Karnak and Luxor in the city itself and the tombs of famed pharaohs - including Tutankhamen - in valleys nearby.The governor of Luxor, Ezzat Saad, told the BBC he wanted to send his condolences to the families of those killed and injured.
"We have never seen anything quite like this in Luxor before. It is an awful thing," he said.
"For the safety of the tourists and the Egyptians I have ordered all the companies dealing with balloons to stop flights until we know exactly what happened and the reasons for it."
The crash happened on one of the many dawn hot air balloon flights that give tourists an aerial view of Luxor's famous sites, such as Karnak temple and the royal tombs in the Valley of the Kings.
The balloon's operating company, Sky Cruise, said a gas cylinder exploded on board, bringing it down in sugar cane fields just west of Luxor.
Cherry Tohamy's balloon was landing when she heard an explosion and saw flames from a balloon above.
U.S., Japan agree on approach to Trans-Pacific Partnership talks
The United States and Japan on Friday agreed on language aimed at giving Japanese Prime Minister Shinzo Abe political cover to bring the world's third-largest economy into negotiations on a U.S.-led free trade agreement in the Asia Pacific region.
In a carefully worded statement following Abe's meeting with President Barack Obama, the two countries reaffirmed that "all goods would subject to negotiation" if Japan joins the talks with the United States and 10 other countries.
At the same time, the statement leaves open a possible outcome to the Trans-Pacific Partnership, or TPP, talks where the Japan could still protect its rice sector and the United States could keep duties on Japanese autos.
Monday, February 25, 2013
Chinese hackers seen as increasingly professional, experts say Read more: http://www.foxnews.com/tech/2013/02/25/chinese-hackers-seen-as-increasingly-professional-experts-say
Beijing hotly denies accusations of official involvement in massive cyberattacks against foreign targets, insinuating such activity is the work of rogues. But at least one element cited by Internet experts points to professional cyberspies: China's hackers take the weekend off.
Accusations of state-sanctioned hacking took center stage this past week following a detailed report by a U.S.-based Internet security firm Mandiant. It added to growing suspicions that the Chinese military is not only stealing national defense secrets and harassing dissidents but also pilfering information from foreign companies that could be worth millions or even billions of dollars.
Experts say Chinese hacking attacks are characterized not only by their brazenness, but by their persistence.
"China conducts at least an order of magnitude more than the next country," said Martin Libicki, a specialist on cyber warfare at the Rand Corporation, based in Santa Monica, California. The fact that hackers take weekends off suggests they are paid, and that would belie "the notion that the hackers are private," he said.
Libicki and other cyber warfare experts have long noted a Monday-through-Friday pattern in the intensity of attacks believed to come from Chinese sources, though there has been little evidence released publicly directly linking the Chinese military to the attacks.
Mandiant went a step further in its report Tuesday saying that it had traced hacking activities against 141 foreign entities in the U.S. Canada, Britain and elsewhere to a group of operators known as the "Comment Crew" or "APT1," for "Advanced Persistent Threat 1," which it traced back to the People's Liberation Army Unit 61398. The unit is headquartered in a nondescript 12-story building inside a military compound in a crowded suburb of China's financial hub of Shanghai.
Attackers stole information about pricing, contract negotiations, manufacturing, product testing and corporate acquisitions, the company said.
Hacker teams regularly began work, for the most part, at 8 a.m. Beijing time. Usually they continued for a standard work day, but sometimes the hacking persisted until midnight. Occasionally, the attacks stopped for two-week periods, Mandiant said, though the reason was not clear.
China denies any official involvement, calling such accusations "groundless" and insisting that Beijing is itself a major victim of hacking attacks, the largest number of which originate in the U.S. While not denying hacking attacks originated in China, Foreign Ministry spokesman Hong Lei said Thursday that it was flat out wrong to accuse the Chinese government or military of being behind them.
Mandiant and other experts believe Unit 61398 to be a branch of the PLA General Staff's Third Department responsible for collection and analysis of electronic signals such as e-mails and phone calls. It and the Fourth Department, responsible for electronic warfare, are believed to be the PLA units mainly responsible for infiltrating and manipulating computer networks.
China acknowledges pursuing these strategies as a key to delivering an initial blow to an opponent's communications and other infrastructure during wartime -- but the techniques are often the same as those used to steal information for commercial use.
China has consistently denied state-sponsored hacking, but experts say the office hours that the cyberspies keep point to a professional army rather than mere hobbyists or so-called "hacktivists" inspired by patriotic passions.
Mandiant noticed that pattern while monitoring attacks on the New York Times last year blamed on another Chinese hacking group it labeled APT12. Hacker activity began at around 8:00 a.m. Beijing time and usually lasted through a standard workday.
The Rand Corporation's Libicki said he wasn't aware of any comprehensive studies, but that in such cases, most activity between malware embedded in a compromised system and the malware's controllers takes place during business hours in Beijing's time zone.
Richard Forno, director of the University of Maryland Baltimore County's graduate cybersecurity program, and David Clemente, a cybersecurity expert with independent analysis center Chatham House in London, said that observation has been widely noted among cybersecurity specialists.
"It would reflect the idea that this is becoming a more routine activity and that they are quite methodical," Clemente said.
The PLA's Third Department is brimming with resources, according to studies commissioned by the U.S. government, with 12 operation bureaus, three research institutes, and an estimated 13,000 linguists, technicians and researchers on staff. It's further reinforced by technical teams from China's seven military regions spread across the country, and by the military's vast academic resources, especially the PLA University of Information Engineering and the Academy of Military Sciences.
The PLA is believed to have made cyber warfare a key priority in its war-fighting capabilities more than a decade ago. Among the few public announcements of its development came in a May 25, 2011 news conference by Defense Ministry spokesman Geng Yansheng, in which he spoke of developing China's "online" army.
"Currently, China's network protection is comparatively weak," Geng told reporters, adding that enhancing information technology and "strengthening network security protection are important components of military training for an army."
Unit 61398 is considered just one of many such units under the Third Department responsible for hacking, according to experts.
Greg Walton, a cyber-security researcher who has tracked Chinese hacking campaigns, said he's observed the "Comment Crew" at work, but cites as equally active another Third Department unit operating out of the southwestern city of Chengdu. It is tasked with stealing secrets from Indian government security agencies and think tanks, together with the India-based Tibetan Government in Exile, Walton said.
Another hacking outfit believed by some to have PLA links, the "Elderwood Group," has targeted defense contractors, human rights groups, non-governmental organizations, and service providers, according to computer security company Symantec.
It's believed to have compromised Amnesty International's Hong Kong website in May 2012, although other attacks have gone after targets as diverse as the Council on Foreign Relations and Capstone Turbine Corporation, which makes gas microturbines for power plants.
Civilian departments believed to be involved in hacking include those under the Ministry of Public Security, which commands the police, and the Ministry of State Security, one of the leading clandestine intelligence agencies. The MSS is especially suspected in attacks on foreign academics studying Chinese social issues and unrest in the western regions of Tibet and Xinjiang.
Below them on the hacking hierarchy are private actors, including civilian universities and research institutes, state industries in key sectors such as information technology and resources, and college students and other individuals acting alone or in groups, according to analysts, University of Maryland's Forno said.
China's government isn't alone in being accused of cyber espionage, but observers say it has outpaced its rivals in using military assets to steal commercial secrets.
"Stealing secrets is stealing secrets regardless of the medium," Forno said. "The key difference is that you can't easily arrest such electronic thieves since they're most likely not even in the country, which differs from how the game was played during the Cold War."
Accusations of state-sanctioned hacking took center stage this past week following a detailed report by a U.S.-based Internet security firm Mandiant. It added to growing suspicions that the Chinese military is not only stealing national defense secrets and harassing dissidents but also pilfering information from foreign companies that could be worth millions or even billions of dollars.
Experts say Chinese hacking attacks are characterized not only by their brazenness, but by their persistence.
"China conducts at least an order of magnitude more than the next country," said Martin Libicki, a specialist on cyber warfare at the Rand Corporation, based in Santa Monica, California. The fact that hackers take weekends off suggests they are paid, and that would belie "the notion that the hackers are private," he said.
Libicki and other cyber warfare experts have long noted a Monday-through-Friday pattern in the intensity of attacks believed to come from Chinese sources, though there has been little evidence released publicly directly linking the Chinese military to the attacks.
Mandiant went a step further in its report Tuesday saying that it had traced hacking activities against 141 foreign entities in the U.S. Canada, Britain and elsewhere to a group of operators known as the "Comment Crew" or "APT1," for "Advanced Persistent Threat 1," which it traced back to the People's Liberation Army Unit 61398. The unit is headquartered in a nondescript 12-story building inside a military compound in a crowded suburb of China's financial hub of Shanghai.
Attackers stole information about pricing, contract negotiations, manufacturing, product testing and corporate acquisitions, the company said.
Hacker teams regularly began work, for the most part, at 8 a.m. Beijing time. Usually they continued for a standard work day, but sometimes the hacking persisted until midnight. Occasionally, the attacks stopped for two-week periods, Mandiant said, though the reason was not clear.
China denies any official involvement, calling such accusations "groundless" and insisting that Beijing is itself a major victim of hacking attacks, the largest number of which originate in the U.S. While not denying hacking attacks originated in China, Foreign Ministry spokesman Hong Lei said Thursday that it was flat out wrong to accuse the Chinese government or military of being behind them.
Mandiant and other experts believe Unit 61398 to be a branch of the PLA General Staff's Third Department responsible for collection and analysis of electronic signals such as e-mails and phone calls. It and the Fourth Department, responsible for electronic warfare, are believed to be the PLA units mainly responsible for infiltrating and manipulating computer networks.
China acknowledges pursuing these strategies as a key to delivering an initial blow to an opponent's communications and other infrastructure during wartime -- but the techniques are often the same as those used to steal information for commercial use.
China has consistently denied state-sponsored hacking, but experts say the office hours that the cyberspies keep point to a professional army rather than mere hobbyists or so-called "hacktivists" inspired by patriotic passions.
Mandiant noticed that pattern while monitoring attacks on the New York Times last year blamed on another Chinese hacking group it labeled APT12. Hacker activity began at around 8:00 a.m. Beijing time and usually lasted through a standard workday.
The Rand Corporation's Libicki said he wasn't aware of any comprehensive studies, but that in such cases, most activity between malware embedded in a compromised system and the malware's controllers takes place during business hours in Beijing's time zone.
Richard Forno, director of the University of Maryland Baltimore County's graduate cybersecurity program, and David Clemente, a cybersecurity expert with independent analysis center Chatham House in London, said that observation has been widely noted among cybersecurity specialists.
"It would reflect the idea that this is becoming a more routine activity and that they are quite methodical," Clemente said.
The PLA's Third Department is brimming with resources, according to studies commissioned by the U.S. government, with 12 operation bureaus, three research institutes, and an estimated 13,000 linguists, technicians and researchers on staff. It's further reinforced by technical teams from China's seven military regions spread across the country, and by the military's vast academic resources, especially the PLA University of Information Engineering and the Academy of Military Sciences.
The PLA is believed to have made cyber warfare a key priority in its war-fighting capabilities more than a decade ago. Among the few public announcements of its development came in a May 25, 2011 news conference by Defense Ministry spokesman Geng Yansheng, in which he spoke of developing China's "online" army.
"Currently, China's network protection is comparatively weak," Geng told reporters, adding that enhancing information technology and "strengthening network security protection are important components of military training for an army."
Unit 61398 is considered just one of many such units under the Third Department responsible for hacking, according to experts.
Greg Walton, a cyber-security researcher who has tracked Chinese hacking campaigns, said he's observed the "Comment Crew" at work, but cites as equally active another Third Department unit operating out of the southwestern city of Chengdu. It is tasked with stealing secrets from Indian government security agencies and think tanks, together with the India-based Tibetan Government in Exile, Walton said.
Another hacking outfit believed by some to have PLA links, the "Elderwood Group," has targeted defense contractors, human rights groups, non-governmental organizations, and service providers, according to computer security company Symantec.
It's believed to have compromised Amnesty International's Hong Kong website in May 2012, although other attacks have gone after targets as diverse as the Council on Foreign Relations and Capstone Turbine Corporation, which makes gas microturbines for power plants.
Civilian departments believed to be involved in hacking include those under the Ministry of Public Security, which commands the police, and the Ministry of State Security, one of the leading clandestine intelligence agencies. The MSS is especially suspected in attacks on foreign academics studying Chinese social issues and unrest in the western regions of Tibet and Xinjiang.
Below them on the hacking hierarchy are private actors, including civilian universities and research institutes, state industries in key sectors such as information technology and resources, and college students and other individuals acting alone or in groups, according to analysts, University of Maryland's Forno said.
China's government isn't alone in being accused of cyber espionage, but observers say it has outpaced its rivals in using military assets to steal commercial secrets.
"Stealing secrets is stealing secrets regardless of the medium," Forno said. "The key difference is that you can't easily arrest such electronic thieves since they're most likely not even in the country, which differs from how the game was played during the Cold War."
Armenian president wins re-election in disputed vote
Armenian President Serzh Sarkisian claimed re-election victory on Tuesday, with official results handing him over 58 percent of the vote. But main rival Raffi Hovannisian insisted he was the real winner and called on Sarkisian to concede defeat.
Armenian President Serzh Sarkisian has won re-election with over 58 percent of the vote, official results published Tuesday showed, as his main rival cried foul.
The Central Election Commission said that tallies from all voting precincts, following Monday's election, showed former foreign minister Raffi Hovannisian trailing in a distant second place with 36.75 percent of votes cast.
But Hovannisian insisted he was the real winner and called on Sarkisian to concede defeat, despite the official results which gave him 58.64 percent of the votes.
Referring to himself, Hovannisian said: "Our people deserve a de jure elected president."
Hovannisian's camp has alleged a range of sometimes bizarre electoral violations, including the use of "vanishing ink" to allow multiple voting and "caravans" of taxis and buses to take pro-government voters to the polls.
However Eduard Sharmazanov, spokesman for Sarkisian's ruling Republican Party, said exit polls showed the president "was the only favourite" and called the vote "the best in the history of independent Armenia", rejecting allegations of fraud.
Police also dismissed the allegations as an "obvious fiction".
Voter turnout was 60 percent in the polls seen as a crucial democratic test for the former Soviet state.
A Gallup exit poll had also found Sarkisian, president since 2008, set for re-election to another five-year term.
The five other candidates were said to be scoring in single digits.
Former prime minister Hrant Bagratian was on course for three percent, as was the Soviet-era dissident Paruyr Hayrikyan, according to the exit poll.
The outcome had become predictable back in December when the highly popular leader of the Prosperous Armenia party -- super-rich former arm-wrestling champion Gagik Tsarukian -- said he was out of the race and Armenia's first post-Soviet president Levon Ter-Petrosian said he was too old for the country's top job.
The election was clouded both by the lack of strong opposition to the incumbent, and a mysterious assassination attempt against Hayrikyan last month.
The authorities were hoping for a peaceful process that would improve the country's chances of European integration.
The vote that brought Sarkisian to power in 2008 ended in clashes in which 10 people died.
Hovannisian said the election marked "the most crucial day in our country's modern history" but denounced irregularities in voters' lists and voting procedures.
"These were shameful elections with a huge number of violations. The results of the exit poll do not show reality but what the authorities wanted," Hovannisian's spokesman Hovsep Khurshudian told AFP.
He vowed that Hovannisian's supporters would stage a protest on Tuesday evening.
International observers from the Organisation for Security and Cooperation in Europe have monitored voting and are set to give their verdict on Tuesday.
Sarkisian, 59, is a veteran of the 1990s war with Azerbaijan over the disputed region of Nagorny Karabakh and derives much of his popularity from a tough can-do militaristic image.
Hovannisian, 54, was born in the United States and practised law in Los Angeles before moving to Armenia following its devastating December 1988 earthquake.
All the candidates made populist promises to fight poverty and unemployment.
The World Bank estimates that 36 percent of Armenians live below the poverty line, while economic hardship and unemployment have driven nearly a million Armenians out of the country over the past two decades.
But campaigning has also focused on Armenia's long-running disputes with neighbours Turkey and Azerbaijan.
No final peace deal has been reached with Azerbaijan over the Armenian-controlled Azerbaijani region of Nagorny Karabakh as the risk of a new conflict remains palpable.
Armenian President Serzh Sarkisian has won re-election with over 58 percent of the vote, official results published Tuesday showed, as his main rival cried foul.
The Central Election Commission said that tallies from all voting precincts, following Monday's election, showed former foreign minister Raffi Hovannisian trailing in a distant second place with 36.75 percent of votes cast.
But Hovannisian insisted he was the real winner and called on Sarkisian to concede defeat, despite the official results which gave him 58.64 percent of the votes.
Referring to himself, Hovannisian said: "Our people deserve a de jure elected president."
Hovannisian's camp has alleged a range of sometimes bizarre electoral violations, including the use of "vanishing ink" to allow multiple voting and "caravans" of taxis and buses to take pro-government voters to the polls.
However Eduard Sharmazanov, spokesman for Sarkisian's ruling Republican Party, said exit polls showed the president "was the only favourite" and called the vote "the best in the history of independent Armenia", rejecting allegations of fraud.
Police also dismissed the allegations as an "obvious fiction".
Voter turnout was 60 percent in the polls seen as a crucial democratic test for the former Soviet state.
A Gallup exit poll had also found Sarkisian, president since 2008, set for re-election to another five-year term.
The five other candidates were said to be scoring in single digits.
Former prime minister Hrant Bagratian was on course for three percent, as was the Soviet-era dissident Paruyr Hayrikyan, according to the exit poll.
The outcome had become predictable back in December when the highly popular leader of the Prosperous Armenia party -- super-rich former arm-wrestling champion Gagik Tsarukian -- said he was out of the race and Armenia's first post-Soviet president Levon Ter-Petrosian said he was too old for the country's top job.
The election was clouded both by the lack of strong opposition to the incumbent, and a mysterious assassination attempt against Hayrikyan last month.
The authorities were hoping for a peaceful process that would improve the country's chances of European integration.
The vote that brought Sarkisian to power in 2008 ended in clashes in which 10 people died.
Hovannisian said the election marked "the most crucial day in our country's modern history" but denounced irregularities in voters' lists and voting procedures.
"These were shameful elections with a huge number of violations. The results of the exit poll do not show reality but what the authorities wanted," Hovannisian's spokesman Hovsep Khurshudian told AFP.
He vowed that Hovannisian's supporters would stage a protest on Tuesday evening.
International observers from the Organisation for Security and Cooperation in Europe have monitored voting and are set to give their verdict on Tuesday.
Sarkisian, 59, is a veteran of the 1990s war with Azerbaijan over the disputed region of Nagorny Karabakh and derives much of his popularity from a tough can-do militaristic image.
Hovannisian, 54, was born in the United States and practised law in Los Angeles before moving to Armenia following its devastating December 1988 earthquake.
All the candidates made populist promises to fight poverty and unemployment.
The World Bank estimates that 36 percent of Armenians live below the poverty line, while economic hardship and unemployment have driven nearly a million Armenians out of the country over the past two decades.
But campaigning has also focused on Armenia's long-running disputes with neighbours Turkey and Azerbaijan.
No final peace deal has been reached with Azerbaijan over the Armenian-controlled Azerbaijani region of Nagorny Karabakh as the risk of a new conflict remains palpable.
Deadly explosion hits crowded market in southern India
Two bombs rigged up to bicycles exploded in a bustling market-place in India’s southern city of Hyderabad on Thursday, killing at least 11 people and injuring dozens of others.
Two bombs placed on bicycles exploded in a crowded market-place in the southern Indian city of Hyderabad on Thursday, and the federal home minister said at least 11 people were killed and 50 wounded.
All major cities in the country were placed on high alert, television channels said, adding that as many as 15 people may have been killed in the explosions.
Hyderabad is a major IT centre in India, only second to Bangalore. Microsoft and Google have major centres in the city.
“Both blasts took place within a radius of 150 metres,” federal Home (Interior) Minister Sushil Shinde told reporters, adding the explosives were placed on bicycles parked in the crowded marketplace. “Eight people died at one place, three at the other.”
The explosions come less than two weeks after India hanged a Kashmiri man for a militant attack on the country’s parliament in 2001 that had sparked violent clashes.
Witnesses told Reuters they heard at least two explosions in the Dilsukh Nagar area of Hyderabad just after dusk but there could have been more.
TV showed debris and body parts strewn on the street in the area, a crowded neighbourhood of cinema halls, shops, restaurants and a fruit and vegetable market.
Prime Minister Manmohan Singh called it a “dastardly attack”.
“I appeal to the public to remain calm and maintain peace,” he said in a Twitter message.
In July 2011, three near-simultaneous blasts ripped through India’s financial capital, Mumbai. At least 20 people were killed and over 100 wounded in the blasts set off by Muslim militants, authorities said.
Last year, four small explosions occurred in quick succession in a busy shopping area of the western Indian city of Pune.
Two bombs placed on bicycles exploded in a crowded market-place in the southern Indian city of Hyderabad on Thursday, and the federal home minister said at least 11 people were killed and 50 wounded.
All major cities in the country were placed on high alert, television channels said, adding that as many as 15 people may have been killed in the explosions.
Hyderabad is a major IT centre in India, only second to Bangalore. Microsoft and Google have major centres in the city.
“Both blasts took place within a radius of 150 metres,” federal Home (Interior) Minister Sushil Shinde told reporters, adding the explosives were placed on bicycles parked in the crowded marketplace. “Eight people died at one place, three at the other.”
The explosions come less than two weeks after India hanged a Kashmiri man for a militant attack on the country’s parliament in 2001 that had sparked violent clashes.
Witnesses told Reuters they heard at least two explosions in the Dilsukh Nagar area of Hyderabad just after dusk but there could have been more.
TV showed debris and body parts strewn on the street in the area, a crowded neighbourhood of cinema halls, shops, restaurants and a fruit and vegetable market.
Prime Minister Manmohan Singh called it a “dastardly attack”.
“I appeal to the public to remain calm and maintain peace,” he said in a Twitter message.
In July 2011, three near-simultaneous blasts ripped through India’s financial capital, Mumbai. At least 20 people were killed and over 100 wounded in the blasts set off by Muslim militants, authorities said.
Last year, four small explosions occurred in quick succession in a busy shopping area of the western Indian city of Pune.
South Korea swears in first female president
Park Geun-Hye was sworn in as South Korea's first female president on Monday, continuing a controversial legacy founded by her father, Park Chung-Hee, who became president in a 1961 military coup. He was later assassinated.
Park Geun-Hye was sworn in as South Korea's first female president Monday, capping a political career founded in privilege and personal tragedy.
Unlike her predecessors, she already knows the presidential Blue House well, having lived there as a child and served there after her mother's murder as first lady to her later-assassinated father.
Park was just nine years old when her father, Park Chung-Hee, came to power in 1961 in a military coup that set the stage for 18 years of authoritarian rule.
Her presidential victory was, in some ways, a referendum on the legacy of her father whose name still triggers polarised emotions in many South Koreans.
Admired for dragging the war-torn nation out of poverty, but reviled in some quarters for his repression of dissent, his shadow loomed large over Park's election campaign last December.
In an effort at reconciliation, Park publicly acknowledged the excesses of her father's regime during her campaign and apologised to the families of its victims.
Park was attending graduate school in France in 1974 when she was called back to Seoul after her mother was killed by a pro-North Korean gunman aiming for her father.
She left the presidential palace after her father was shot dead by his spy chief in 1979 and began her political career in 1998 as a lawmaker in her home town.
Park, 61, never married and has no children -- a fact she used to gain traction with voters tired of nepotism and corruption scandals surrounding their first families.
"I will earn the trust of the people by ensuring that our government remains clean, transparent and competent," she said in her inauguration speech, in which she also invoked the past image of a more caring, compassionate Korea.
"Reviving that spirit once again and building a society flowing with responsibility and consideration for others will allow us to be confident that a new era of happiness that all of us dream of is truly within our reach," she said.
The nurturing, maternal political image is at odds with that pushed by her critics, of an aloof aristocrat they call the "ice queen".
But even dissenters acknowledge her strengths as a campaigner that helped her party secure strong results in local and national polls in 2004, 2006 and this year, earning her another royal moniker as the "queen of elections".
And despite her privileged upbringing, Park has demonstrated a tough streak.
In 2006 an attacker at an election event where she was speaking slashed her face with a knife, leaving a wound that needed 60 stitches.
She will face numerous challenges when she begins her five-year term on Monday, not least dealing with a North Korea that triggered global outrage by conducting a nuclear test just weeks before her inauguration.
Even before Park won her party's presidential nomination last August the state-run Korean Central News Agency had attacked her candidacy, warning that "a dictator's bloodline cannot change away from its viciousness".
Park has signalled a break from outgoing President Lee Myung-Bak's hard line on Pyongyang, and even held out the possibility of an eventual summit with North Korea leader Kim Jong-Un.
But she will be restricted by conservative forces in her party as well as an international community intent on punishing North Korea.
The North's February 12 nuclear test is almost certain to draw toughened UN sanctions -- a move likely to anger Pyongyang and further heighten tension on the peninsula.
While Park's election as South Korea's first woman president marks a major breakthrough in a male-dominated country, not everyone sees her victory as paving the way for greater women's rights.
Kim Eun-Ju, executive director of the Centre for Korean Women and Politics, believes Park is a female political leader "only in biological terms".
"For the past 15 years, Park has shown little visible effort to help women in politics or anywhere else as a policymaker," Kim told AFP.
Park Geun-Hye was sworn in as South Korea's first female president Monday, capping a political career founded in privilege and personal tragedy.
Unlike her predecessors, she already knows the presidential Blue House well, having lived there as a child and served there after her mother's murder as first lady to her later-assassinated father.
Park was just nine years old when her father, Park Chung-Hee, came to power in 1961 in a military coup that set the stage for 18 years of authoritarian rule.
Her presidential victory was, in some ways, a referendum on the legacy of her father whose name still triggers polarised emotions in many South Koreans.
Admired for dragging the war-torn nation out of poverty, but reviled in some quarters for his repression of dissent, his shadow loomed large over Park's election campaign last December.
In an effort at reconciliation, Park publicly acknowledged the excesses of her father's regime during her campaign and apologised to the families of its victims.
Park was attending graduate school in France in 1974 when she was called back to Seoul after her mother was killed by a pro-North Korean gunman aiming for her father.
She left the presidential palace after her father was shot dead by his spy chief in 1979 and began her political career in 1998 as a lawmaker in her home town.
Park, 61, never married and has no children -- a fact she used to gain traction with voters tired of nepotism and corruption scandals surrounding their first families.
"I will earn the trust of the people by ensuring that our government remains clean, transparent and competent," she said in her inauguration speech, in which she also invoked the past image of a more caring, compassionate Korea.
"Reviving that spirit once again and building a society flowing with responsibility and consideration for others will allow us to be confident that a new era of happiness that all of us dream of is truly within our reach," she said.
The nurturing, maternal political image is at odds with that pushed by her critics, of an aloof aristocrat they call the "ice queen".
But even dissenters acknowledge her strengths as a campaigner that helped her party secure strong results in local and national polls in 2004, 2006 and this year, earning her another royal moniker as the "queen of elections".
And despite her privileged upbringing, Park has demonstrated a tough streak.
In 2006 an attacker at an election event where she was speaking slashed her face with a knife, leaving a wound that needed 60 stitches.
She will face numerous challenges when she begins her five-year term on Monday, not least dealing with a North Korea that triggered global outrage by conducting a nuclear test just weeks before her inauguration.
Even before Park won her party's presidential nomination last August the state-run Korean Central News Agency had attacked her candidacy, warning that "a dictator's bloodline cannot change away from its viciousness".
Park has signalled a break from outgoing President Lee Myung-Bak's hard line on Pyongyang, and even held out the possibility of an eventual summit with North Korea leader Kim Jong-Un.
But she will be restricted by conservative forces in her party as well as an international community intent on punishing North Korea.
The North's February 12 nuclear test is almost certain to draw toughened UN sanctions -- a move likely to anger Pyongyang and further heighten tension on the peninsula.
While Park's election as South Korea's first woman president marks a major breakthrough in a male-dominated country, not everyone sees her victory as paving the way for greater women's rights.
Kim Eun-Ju, executive director of the Centre for Korean Women and Politics, believes Park is a female political leader "only in biological terms".
"For the past 15 years, Park has shown little visible effort to help women in politics or anywhere else as a policymaker," Kim told AFP.
Monday, February 18, 2013
Global investors watch how chips fall in China's cashless casino bar
SANYA – Placing bets on green-felt baccarat tables in a new casino bar on China's southern Hainan island, punters seem oblivious to a huge wager quietly being placed around them, one that could potentially siphon business from the world's largest gaming hub in Macau an hour's flight away.
For now, players at Jesters casino bar, part of the newly opened Mangrove Tree Resort World on Sanya Bay, cannot win cash - only points that they can use to pay for accommodation, luxury goods, jewelry and artwork for sale at the resort.
Owned by art, film and real estate mogul Zhang Baoquan, the casino bar marks the Chinese government's first tacit approval of a gaming concept outside of Macau. Global investors, including some of the world's biggest gaming companies, are watching to see how the chips will fall.
"Our casino bar is the first in the country. The government is monitoring, it's a test," Zhang told Reuters in a recent interview at his 23rd-floor office overlooking his sprawling 173-acre property that opened late last year.
"Right now we are not at this stage (legalising casino gambling), but my personal opinion is, in future, there is a big possibility that they will have."
The stakes are enormous -- China's monopoly gambling site, Macau, raked in $38 billion in gaming revenues last year, primarily from Chinese gamblers. If Beijing were to allow gambling elsewhere in the country, cash would follow.
It's not just the Chinese government that is watching the development. MGM Resorts International opened a hotel in Sanya last year and fellow U.S. casino operator Caesars Entertainment is set to open a hotel in 2014.
An MGM spokesman said the company had no plan to introduce "anything of this kind". Caesars did not respond to requests for comment.
Dressed in jeans and a black-and-white Hawaiian shirt during his interview, the 56-year-old Zhang said he aims to create an integrated resort similar to those in Las Vegas and Singapore where gaming, convention space and retail outlets are offered together.
Mangrove Tree Resort World, the newest addition to Hainan's rapidly developing hotel scene, will be China's biggest resort when construction is completed next year. It will have more than 4,000 rooms, a convention hall accommodating 6,000 people and facilities including a water park.
It is one of 10 integrated resorts that Zhang is developing around the country, including one more in Sanya and others stretching from Lhasa in Tibet to the eastern coastal city Qingdao.
While the Chinese government does not permit casinos in the country outside of Macau, Zhang - ranked by Forbes as one of the country's 300 richest people in 2012 with $600 million - said Hainan could become an exception.
Sensitive to existing restrictions, the soft-spoken businessman emphasized cultural attractions such as his art gallery that, along with the casino bar, will be incorporated into the planned resorts.
WINNING "MANGROVE" POINTS
Inside Jesters, which models itself on Macau's casino halls with garish chandeliers and a giant roulette wheel ceiling, players buy tickets costing 500 yuan ($80) each. Bets range from 20-2,000 yuan in the mass area, while the high-limits area is set at 2,000-100,000 yuan. Big whale punters will be able to bet over 100,000 yuan once the VIP room opens on the second floor.
The casino bar, with 50 gaming tables now, is currently open only to hotel guests, but when the resort is completed, local residents will be allowed in.
When players win, they receive "Mangrove" points that can be used to buy products available in the casino such as an iPad 3G or a Rimowa suitcase. Once luxury brands open outlets within the resort, customers will be able to spend their points in those stores. Art work from Zhang's Beijing art gallery is also available for purchase.
Retail stores including Prada and Louis Vuitton will be part of a network of 20 luxury stores that will open at the resort next year, Zhang said.
Zhang, president of Beijing conglomerate Antaeus, has the financial backing of China Development Bank. The state lender invested 70 percent of the cost of the Mangrove Tree expansion.
"The local governments are very supportive," says the boyish-looking Zhang, who started off as a carpenter in his hometown of Zhenjiang in eastern Jiangsu province, and now is well known as an arts philanthropist and prominent film investor.
Married to Wang Qiuyang, a mountaineer whose father Wang Chengbin was a former army commander, Zhang said any potential change to gambling restrictions would take time, adding that the government would need to decide whether to let other operators open similar casino bars.
"Gambling culturally is a very bad thing, but today there is a difference -- gambling is a financial tool," said Zhang.
"In Asia, even North Korea has two casinos. The richest country, Singapore, before you would never think society would accept it there. All over the world the attitude towards casinos is different from what it was traditionally."
SANYA AND BEYOND
China is positioning Hainan as an international tourist destination, approving the construction of 15 large resorts and 63 five-star hotels as part of the country's five-year plan.
As Chinese spend their money in new casinos across Asia from the Philippines to Vietnam, pressure is growing on Beijing to keep more gamblers at home.
"To some extent, the approval of gaming on Chinese soil is inevitable," said Gary Pinge, analyst at Macquarie Group in Hong Kong.
"With regional markets already vying for a share of the Chinese gambling wallet, unless China brings gaming onto its own shores, it will not only lose tax revenues to other countries, but also the 'multiplier effect' from the consumption spend."
In the meantime, Zhang is pushing ahead with his expansion plans. Aiming to list the Mangrove Tree brand on the Hong Kong stock exchange in 2015, Zhang hopes to use the capital raised to take his Mangrove Tree brand outside of China.
"Sydney, the Maldives, the United States, England, Paris and Turkey" would all be good, said Zhang with a shy smile.
For now, players at Jesters casino bar, part of the newly opened Mangrove Tree Resort World on Sanya Bay, cannot win cash - only points that they can use to pay for accommodation, luxury goods, jewelry and artwork for sale at the resort.
Owned by art, film and real estate mogul Zhang Baoquan, the casino bar marks the Chinese government's first tacit approval of a gaming concept outside of Macau. Global investors, including some of the world's biggest gaming companies, are watching to see how the chips will fall.
"Our casino bar is the first in the country. The government is monitoring, it's a test," Zhang told Reuters in a recent interview at his 23rd-floor office overlooking his sprawling 173-acre property that opened late last year.
"Right now we are not at this stage (legalising casino gambling), but my personal opinion is, in future, there is a big possibility that they will have."
The stakes are enormous -- China's monopoly gambling site, Macau, raked in $38 billion in gaming revenues last year, primarily from Chinese gamblers. If Beijing were to allow gambling elsewhere in the country, cash would follow.
It's not just the Chinese government that is watching the development. MGM Resorts International opened a hotel in Sanya last year and fellow U.S. casino operator Caesars Entertainment is set to open a hotel in 2014.
An MGM spokesman said the company had no plan to introduce "anything of this kind". Caesars did not respond to requests for comment.
Dressed in jeans and a black-and-white Hawaiian shirt during his interview, the 56-year-old Zhang said he aims to create an integrated resort similar to those in Las Vegas and Singapore where gaming, convention space and retail outlets are offered together.
Mangrove Tree Resort World, the newest addition to Hainan's rapidly developing hotel scene, will be China's biggest resort when construction is completed next year. It will have more than 4,000 rooms, a convention hall accommodating 6,000 people and facilities including a water park.
It is one of 10 integrated resorts that Zhang is developing around the country, including one more in Sanya and others stretching from Lhasa in Tibet to the eastern coastal city Qingdao.
While the Chinese government does not permit casinos in the country outside of Macau, Zhang - ranked by Forbes as one of the country's 300 richest people in 2012 with $600 million - said Hainan could become an exception.
Sensitive to existing restrictions, the soft-spoken businessman emphasized cultural attractions such as his art gallery that, along with the casino bar, will be incorporated into the planned resorts.
WINNING "MANGROVE" POINTS
Inside Jesters, which models itself on Macau's casino halls with garish chandeliers and a giant roulette wheel ceiling, players buy tickets costing 500 yuan ($80) each. Bets range from 20-2,000 yuan in the mass area, while the high-limits area is set at 2,000-100,000 yuan. Big whale punters will be able to bet over 100,000 yuan once the VIP room opens on the second floor.
The casino bar, with 50 gaming tables now, is currently open only to hotel guests, but when the resort is completed, local residents will be allowed in.
When players win, they receive "Mangrove" points that can be used to buy products available in the casino such as an iPad 3G or a Rimowa suitcase. Once luxury brands open outlets within the resort, customers will be able to spend their points in those stores. Art work from Zhang's Beijing art gallery is also available for purchase.
Retail stores including Prada and Louis Vuitton will be part of a network of 20 luxury stores that will open at the resort next year, Zhang said.
Zhang, president of Beijing conglomerate Antaeus, has the financial backing of China Development Bank. The state lender invested 70 percent of the cost of the Mangrove Tree expansion.
"The local governments are very supportive," says the boyish-looking Zhang, who started off as a carpenter in his hometown of Zhenjiang in eastern Jiangsu province, and now is well known as an arts philanthropist and prominent film investor.
Married to Wang Qiuyang, a mountaineer whose father Wang Chengbin was a former army commander, Zhang said any potential change to gambling restrictions would take time, adding that the government would need to decide whether to let other operators open similar casino bars.
"Gambling culturally is a very bad thing, but today there is a difference -- gambling is a financial tool," said Zhang.
"In Asia, even North Korea has two casinos. The richest country, Singapore, before you would never think society would accept it there. All over the world the attitude towards casinos is different from what it was traditionally."
SANYA AND BEYOND
China is positioning Hainan as an international tourist destination, approving the construction of 15 large resorts and 63 five-star hotels as part of the country's five-year plan.
As Chinese spend their money in new casinos across Asia from the Philippines to Vietnam, pressure is growing on Beijing to keep more gamblers at home.
"To some extent, the approval of gaming on Chinese soil is inevitable," said Gary Pinge, analyst at Macquarie Group in Hong Kong.
"With regional markets already vying for a share of the Chinese gambling wallet, unless China brings gaming onto its own shores, it will not only lose tax revenues to other countries, but also the 'multiplier effect' from the consumption spend."
In the meantime, Zhang is pushing ahead with his expansion plans. Aiming to list the Mangrove Tree brand on the Hong Kong stock exchange in 2015, Zhang hopes to use the capital raised to take his Mangrove Tree brand outside of China.
"Sydney, the Maldives, the United States, England, Paris and Turkey" would all be good, said Zhang with a shy smile.
Russia's Rosneft, China Discuss Increasing Oil Deliveries
Chinese Vice Premier Wang Qishan and OAO Rosneft (ROSN.RS) chief Igor Sechin on Sunday discussed increasing oil deliveries to China, the Russian oil giant said in a statement.
"The sides discussed a wide range of questions on increasing deliveries of oil to the Chinese People's Republic and also the participation of companies in upstream and downstream in Russia and China," Rosneft said in the statement.
Mr. Sechin is currently leading a Rosneft delegation on a two-day visit to China. Russian news reports in January suggested Rosneft and China were in talks on nearly doubling supplies from the current 300,000 barrels of crude per day.
Reuters news agency cited four unnamed industry sources last week as saying Rosneft could receive a loan of up to $30 billion from China for doubling deliveries.
A spokeswoman for Rosneft declined further comment on the talks Sunday. Rosneft Thursday denied it was in talks on a loan from China.
Rosneft already supplies 15 million metric tons per year to China under a 2009 deal. That agreement saw China extend a $25 billion credit to Rosneft and Russian pipeline operator OAO Transneft.
Rosneft is acquiring competitor TNK-BP in deals worth $55 billion.
In December, Mr. Sechin held talks in Russia with Mr. Wang on a proposed multibillion-dollar refinery and petrochemical project at Tianjin in China.
Write to James Marson at James.Marson@dowjones.com.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
Chinese Vice Premier Wang Qishan and OAO Rosneft (ROSN.RS) chief Igor Sechin on Sunday discussed increasing oil deliveries to China, the Russian oil giant said in a statement.
"The sides discussed a wide range of questions on increasing deliveries of oil to the Chinese People's Republic and also the participation of companies in upstream and downstream in Russia and China," Rosneft said in the statement.
Mr. Sechin is currently leading a Rosneft delegation on a two-day visit to China. Russian news reports in January suggested Rosneft and China were in talks on nearly doubling supplies from the current 300,000 barrels of crude per day.
Reuters news agency cited four unnamed industry sources last week as saying Rosneft could receive a loan of up to $30 billion from China for doubling deliveries.
A spokeswoman for Rosneft declined further comment on the talks Sunday. Rosneft Thursday denied it was in talks on a loan from China.
Rosneft already supplies 15 million metric tons per year to China under a 2009 deal. That agreement saw China extend a $25 billion credit to Rosneft and Russian pipeline operator OAO Transneft.
Rosneft is acquiring competitor TNK-BP in deals worth $55 billion.
In December, Mr. Sechin held talks in Russia with Mr. Wang on a proposed multibillion-dollar refinery and petrochemical project at Tianjin in China.
"The sides discussed a wide range of questions on increasing deliveries of oil to the Chinese People's Republic and also the participation of companies in upstream and downstream in Russia and China," Rosneft said in the statement.
Mr. Sechin is currently leading a Rosneft delegation on a two-day visit to China. Russian news reports in January suggested Rosneft and China were in talks on nearly doubling supplies from the current 300,000 barrels of crude per day.
Reuters news agency cited four unnamed industry sources last week as saying Rosneft could receive a loan of up to $30 billion from China for doubling deliveries.
A spokeswoman for Rosneft declined further comment on the talks Sunday. Rosneft Thursday denied it was in talks on a loan from China.
Rosneft already supplies 15 million metric tons per year to China under a 2009 deal. That agreement saw China extend a $25 billion credit to Rosneft and Russian pipeline operator OAO Transneft.
Rosneft is acquiring competitor TNK-BP in deals worth $55 billion.
In December, Mr. Sechin held talks in Russia with Mr. Wang on a proposed multibillion-dollar refinery and petrochemical project at Tianjin in China.
Write to James Marson at James.Marson@dowjones.com.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
Chinese Vice Premier Wang Qishan and OAO Rosneft (ROSN.RS) chief Igor Sechin on Sunday discussed increasing oil deliveries to China, the Russian oil giant said in a statement.
"The sides discussed a wide range of questions on increasing deliveries of oil to the Chinese People's Republic and also the participation of companies in upstream and downstream in Russia and China," Rosneft said in the statement.
Mr. Sechin is currently leading a Rosneft delegation on a two-day visit to China. Russian news reports in January suggested Rosneft and China were in talks on nearly doubling supplies from the current 300,000 barrels of crude per day.
Reuters news agency cited four unnamed industry sources last week as saying Rosneft could receive a loan of up to $30 billion from China for doubling deliveries.
A spokeswoman for Rosneft declined further comment on the talks Sunday. Rosneft Thursday denied it was in talks on a loan from China.
Rosneft already supplies 15 million metric tons per year to China under a 2009 deal. That agreement saw China extend a $25 billion credit to Rosneft and Russian pipeline operator OAO Transneft.
Rosneft is acquiring competitor TNK-BP in deals worth $55 billion.
In December, Mr. Sechin held talks in Russia with Mr. Wang on a proposed multibillion-dollar refinery and petrochemical project at Tianjin in China.
China says ConocoPhillips unit can resume operations at oilfield closed after leaks in 2011
BEIJING – A Chinese regulator says the Chinese subsidiary of ConocoPhillips can resume operations at an oilfield that was closed in 2011 after two oil spills.
The State Oceanic Administration said in a statement Saturday that conditions at the Penglai 19-3 oilfield had returned to normal after a series of rectification measures. It says ConocoPhillips can gradually resume production there.
The oilfield off northeastern China is jointly owned by ConocoPhillips' Chinese subsidiary and China National Offshore Oil Corp., China's main offshore oil and gas producer.
The two spills occurred in June 2011. Combined, they released more than 30,300 gallons of oil, and more than 110,000 gallons of mineral oil-based drilling mud, which is used as a lubricant for drilling. The oil and mud drained into the Bohai Sea and its bay.
The State Oceanic Administration said in a statement Saturday that conditions at the Penglai 19-3 oilfield had returned to normal after a series of rectification measures. It says ConocoPhillips can gradually resume production there.
The oilfield off northeastern China is jointly owned by ConocoPhillips' Chinese subsidiary and China National Offshore Oil Corp., China's main offshore oil and gas producer.
The two spills occurred in June 2011. Combined, they released more than 30,300 gallons of oil, and more than 110,000 gallons of mineral oil-based drilling mud, which is used as a lubricant for drilling. The oil and mud drained into the Bohai Sea and its bay.
Geely leading China bids for U.S. green-car startup
BEIJING – China's Zhejiang Geely Holding Group is favoured to secure a majority stake in troubled U.S. electric car maker Fisker Automotive, according to two sources familiar with Fisker's search for a strategic investor or partner.
Fisker, the Anaheim-based plug-in hybrid maker, is currently weighing bids from two Chinese auto makers: Geely, the owner of Sweden's Volvo, and state-owned Dongfeng Motor Group Co..
The interest in Fisker reflects China's strong push into alternative fuel cars as it seeks to foster the green technology sector and clear the increasingly polluted skies of its cities.
The knowledgeable individuals said both offers, which Fisker received in the last three weeks, were worth between $200 million to $300 million. A deal would give the suitors a majority stake in the southern Californian company, they said.
The sources, who are close to Fisker, said Geely appeared to be the preferred suitor.
Fisker's corporate leaders and their advisers believe Geely is "more serious" and "passionate" about Fisker and its technology, one of the individuals said.
The Hangzhou-based company also "can move fast" in making decisions -- unlike Dongfeng, whose responsiveness could be hampered by its multi-layered decision-making structure typical in a Chinese state-owned enterprise, the source said.
That quality is likely to work against Dongfeng, since Fisker is under a tight deadline to find a suitor, he added.
"Most of all, with Geely we're dealing with one decision maker," the individual said, referring to its charismatic founder and chairman, Li Shufu.
Geely's Li is also deemed a better suitor due to his experience in making cross-border acquisitions. In 2010, Geely acquired all of Volvo from its previous owner Ford Motor Co.
"Overall, we think Geely is a better fit," the knowledgeable individual said.
The sources noted that Geely had already sent a team of engineers to Anaheim to evaluate Fisker and its technology for battery-powered electric cars with a small gasoline engine used to extend the car's driving range.
Victor Yang, a Geely spokesman in Hangzhou, said: "we are not in position to comment on this at the moment."
Dongfeng also declined to comment. "Dongfeng pays attention to all potential opportunities of international cooperation to cope with future market development both at home and abroad," said spokesman Zhou Mi in an email on Monday.
INTEREST FROM EUROPE, SOUTH KOREA
Fisker -- the producer of the $100,000-plus Karma which it began selling in late 2011 -- fielded interest from several companies including from both South Korea and Europe.
But it received only two firm bids, from Geely and Dongfeng, the sources said. Fisker is hoping to sew up a deal by mid-March, another person said.
Any deal is likely to also involve another Chinese player, Wanxiang Group, an auto parts maker that has purchased bankrupt U.S. lithium-ion battery maker A123 Systems, Fisker's primary battery supplier. A Wanxiang executive declined to comment.
"The company has received detailed proposals from multiple parties in different continents which are now being evaluated by the company and its advisors," Fisker spokesman Roger Ormisher said in an email over the weekend.
He declined to comment further.
A strategic pact would give Fisker the funds to start building its second and more affordable model, the Atlantic plug-in hybrid, which is expected to start at around $55,000 and be Fisker's high-volume vehicle.
Over the last several months, Fisker Chief Executive Tony Posawatz and other Fisker executives have traveled to Europe and Asia to meet investors and automotive makers.
The two bids Fisker is weighing now stem from the trip to Asia that Posawatz and his top executives made in late January.
During that trip, they traveled to Hangzhou, where Geely is based, to meet its chairman Li and his technology chief, Frank Zhao. They also traveled to Wuhan for a meeting with top executives from Dongfeng and then to Beijing for a meeting with Beijing Automotive Industry Holding Co.
The search for financial backers comes after a tough 2012 marred by the rocky and delayed introduction of Fisker's Karma, A123's bankruptcy and an election season that turned the U.S. government-backed company into a political punching bag.
Fisker, the Anaheim-based plug-in hybrid maker, is currently weighing bids from two Chinese auto makers: Geely, the owner of Sweden's Volvo, and state-owned Dongfeng Motor Group Co..
The interest in Fisker reflects China's strong push into alternative fuel cars as it seeks to foster the green technology sector and clear the increasingly polluted skies of its cities.
The knowledgeable individuals said both offers, which Fisker received in the last three weeks, were worth between $200 million to $300 million. A deal would give the suitors a majority stake in the southern Californian company, they said.
The sources, who are close to Fisker, said Geely appeared to be the preferred suitor.
Fisker's corporate leaders and their advisers believe Geely is "more serious" and "passionate" about Fisker and its technology, one of the individuals said.
The Hangzhou-based company also "can move fast" in making decisions -- unlike Dongfeng, whose responsiveness could be hampered by its multi-layered decision-making structure typical in a Chinese state-owned enterprise, the source said.
That quality is likely to work against Dongfeng, since Fisker is under a tight deadline to find a suitor, he added.
"Most of all, with Geely we're dealing with one decision maker," the individual said, referring to its charismatic founder and chairman, Li Shufu.
Geely's Li is also deemed a better suitor due to his experience in making cross-border acquisitions. In 2010, Geely acquired all of Volvo from its previous owner Ford Motor Co.
"Overall, we think Geely is a better fit," the knowledgeable individual said.
The sources noted that Geely had already sent a team of engineers to Anaheim to evaluate Fisker and its technology for battery-powered electric cars with a small gasoline engine used to extend the car's driving range.
Victor Yang, a Geely spokesman in Hangzhou, said: "we are not in position to comment on this at the moment."
Dongfeng also declined to comment. "Dongfeng pays attention to all potential opportunities of international cooperation to cope with future market development both at home and abroad," said spokesman Zhou Mi in an email on Monday.
INTEREST FROM EUROPE, SOUTH KOREA
Fisker -- the producer of the $100,000-plus Karma which it began selling in late 2011 -- fielded interest from several companies including from both South Korea and Europe.
But it received only two firm bids, from Geely and Dongfeng, the sources said. Fisker is hoping to sew up a deal by mid-March, another person said.
Any deal is likely to also involve another Chinese player, Wanxiang Group, an auto parts maker that has purchased bankrupt U.S. lithium-ion battery maker A123 Systems, Fisker's primary battery supplier. A Wanxiang executive declined to comment.
"The company has received detailed proposals from multiple parties in different continents which are now being evaluated by the company and its advisors," Fisker spokesman Roger Ormisher said in an email over the weekend.
He declined to comment further.
A strategic pact would give Fisker the funds to start building its second and more affordable model, the Atlantic plug-in hybrid, which is expected to start at around $55,000 and be Fisker's high-volume vehicle.
Over the last several months, Fisker Chief Executive Tony Posawatz and other Fisker executives have traveled to Europe and Asia to meet investors and automotive makers.
The two bids Fisker is weighing now stem from the trip to Asia that Posawatz and his top executives made in late January.
During that trip, they traveled to Hangzhou, where Geely is based, to meet its chairman Li and his technology chief, Frank Zhao. They also traveled to Wuhan for a meeting with top executives from Dongfeng and then to Beijing for a meeting with Beijing Automotive Industry Holding Co.
The search for financial backers comes after a tough 2012 marred by the rocky and delayed introduction of Fisker's Karma, A123's bankruptcy and an election season that turned the U.S. government-backed company into a political punching bag.
China takes investment and lending risks others won't in going global
MEXICO CITY – When Venezuela seized billions of dollars in assets from Exxon Mobil and other foreign companies, Chinese state banks and investors didn't blink. Over the past five years they have loaned Venezuela more than $35 billion.
Elsewhere around the Caribbean, as hotels were struggling to stay afloat in the global economic slowdown, the Chinese response was to bankroll the biggest resort under construction in the Western Hemisphere — a massive hotel, condominium and casino complex in the Bahamas just a few miles from half-empty resorts.
All over the world, from Latin America to the South Pacific, a cash-flush China is funding projects that others won't, seemingly less concerned by the conventional wisdom of credit ratings and institutions such as the World Bank.
___
EDITOR'S NOTE — This story is part of "China's Reach," a project tracking China's influence on its trading partners over three decades and exploring how that is changing business, politics and daily life. Keep up with AP's reporting on China's Reach, and join the conversation about it, using the hashtag (hash)APChinaReach on Twitter.
___
The Chinese money is breathing life into government infrastructure projects that otherwise might have died for lack of financing. For commercial projects such as the Caribbean resort, China is filling a gap left by Western investors retrenching after the 2008 financial crisis.
But some in the Bahamas worry what will happen if the sprawling Baha Mar project fails. They picture an economy saturated with hotels, dragged down by an expensive Chinese white elephant. Likewise, the infrastructure loans are loading financially shaky countries with more debt and letting them avoid economic reforms that other lenders would likely have demanded.
"The Chinese play by other rules," said Kevin Gallagher, a Boston University international relations professor who has studied Chinese lending to Latin America. "We'll give you financing with no conditions, and we'll finance things the International Monetary Fund won't fund, things others won't fund anymore, like big infrastructure projects. It allows countries to shop around, which has good and bad sides."
Venezuelan leader Hugo Chavez talked up his independence last year while highlighting another $4 billion in Chinese loans, part of a wave of money that has translated into new railways, utilities and other projects.
"In a few days, they're going to deposit 4 billion little dollars more from Beijing," Chavez told reporters, holding up four fingers for emphasis.
"Fortunately, we don't depend on the dreadful bank. What's that one called that you mentioned? The World Bank. Poor are those countries that depend on the World Bank, the International Monetary Fund."
Venezuela's Oil and Mining Minister Rafael Ramirez says China has loaned his country $36 billion since 2008, and others put the figure even higher. The Spanish-language version of a report co-authored by Gallagher, "The New Banks in Town: Chinese Finance in Latin America," estimates it at $46.5 billion.
The loans have added to Venezuela's $95.7 billion in public foreign debt as of mid-2012, which has risen even as the country rakes in record-high oil revenue. Some analysts say the spending helped Chavez win re-election in October, despite battling cancer.
China has emerged in recent years as the largest provider of development loans not only to Venezuela but also to Ecuador and Argentina, according to the Gallagher report. All three are junk bond countries, ratings agencies say. In contrast, the World Bank and Inter-American Development Bank remain larger lenders in Brazil and Mexico, both countries with higher bond ratings.
In cases such as the tiny South Pacific islands of Tonga, China is lending enormous sums to countries few expect will be able to repay.
What has surely given the Chinese banks courage is the trillions of dollars in reserves the country holds in U.S. Treasury bonds, investments that pay almost nothing in interest. Making that money work harder for a return overseas has become nothing less than a national priority, part of China's trumpeted "going out" strategy.
___
China's economy is the second largest after the U.S., and many of the deals stipulate repayment in oil and natural gas, locking in the commodities China will need to sustain its growth for decades to come.
In 2009 and 2010 alone, the China Development Bank extended $65 billion in such loans to energy companies and government entities from Ecuador to Russia and Turkmenistan, according to a report by Erica Downs, a China expert at the Brookings Institution, a U.S. think tank.
"If you're lending tens of billions of dollars to a borrower ..., you want to make sure that loan is secured against something," she said. "In the case of Venezuela, it's the most valuable thing they can offer. It's just one way to ensure they get paid."
In dozens of cases, the Chinese have also demanded that their own companies build the infrastructure that will help governments extract and ship the commodities used to pay back the loans. In Argentina, that means agreements to bring in Chinese companies to revamp the country's decrepit rail system, which would speed up shipments of soy to Chinese consumers.
"The money goes from one account in the China Development Bank into the hands of small- and medium-sized businesses in China," Gallagher said, while noting the majority involve big state companies.
The Chinese also hold a valuable trump card: They're betting that Chavez and other financial pariahs won't dare alienate their last source of affordable money by defaulting on Chinese loans or seizing Chinese assets.
"The Chinese have the upper hand," Downs said. "The China Development Bank sees this country that's thumbed their nose at the IMF. And if they borrowed from the IMF and had to be subjected to IMF conditionality, the regime would fall."
Perhaps with that in mind, more than 30 Chinese consultants toured Venezuela and handed Chavez a thick binder with recommendations on everything from exchange rate reform to agriculture.
While news cameras clicked, Chavez held up the book, thanked his Chinese benefactors and pledged to study the prescriptions. Unlike IMF loans, however, the Chinese recommendations weren't a requirement, and Chavez has shown no sign of curbing public spending.
The investments and loans have contributed to a substantial shift in commerce toward China. Venezuela, for example, saw its trade with the U.S. drop from 26 percent of its GDP in 2006 to 18 percent in 2011, according to an Associated Press analysis of IMF databases. Meanwhile, Chinese trade grew from virtually nothing in 2001 to nearly 6 percent a decade later, much of it in the form of oil to repay loans.
But the money doesn't necessarily save countries from their own bad financial bets.
Zimbabwe, which has received generous Chinese financing, saw inflation peak at 79.6 billion percent a month in November 2008. At one point, a loaf of bread reportedly cost 500 million Zimbabwe dollars. Gideon Gono, governor of the Reserve Bank of Zimbabwe, suggested one possible remedy: Adopt the Chinese yuan as the official currency. (Zimbabwe eventually overcame the crisis by switching to a mix of Western and African currencies.)
Argentina is fighting off an economic reckoning despite receiving more than $12 billion in Chinese loans, according to the Gallagher report. In 2001, the country defaulted on some $100 billion in loans. It struck a deal with most of its lenders, but over the past year, a group of creditors is insisting on payment in full.
"It's extremely concerning," said Margaret Meyers, a China expert at the U.S. think tank the Inter-American Dialogue. "Chinese financing won't be able to sustain these economies unless they go through substantial macroeconomic reforms. For Argentina, that means open markets, reforming institutions, reforming the banking system, fiscal accountability, ending lots of misspending."
Some in the borrowing countries have watched with worry as the Chinese bets play out.
Opposition politicians in Venezuela have slammed the deals for locking in contracts for everything from Chinese-made refrigerators to Chinese construction workers while giving Chavez free rein to spend billions of dollars.
"There's no doubt we're going to need China, they are an economic powerhouse," opposition leader Henrique Capriles said last year. "But many of the agreements the government has signed involve political loyalties that don't interest us."
___
On the beaches of New Providence in the Bahamas, hundreds of Chinese construction workers are toiling around the clock to ready the Baha Mar project for a phased opening scheduled to start in late 2014.
The project will add thousands of hotel rooms not far from the islands' biggest resort, the Atlantis.
"Going forward, we have to achieve a sustainable tourism product," said James Smith, the former state minister of finance for the Bahamas. "If we don't, Baha Mar could be cannibalizing Atlantis."
Baha Mar has opened sales offices all over Asia to promote and presell hundreds of pricey condos, hoping to imprint new travel habits on a continent that's traditionally spent beach vacations in Southeast Asia. It is also working with the Bahamian government to open more consular offices in China to issue visas.
"In general, you would assume that a project of that size is generating its own demand and the idea would probably also be with Chinese money comes an influx of Chinese travelers," said Jan Freitag, senior vice president of hospitality industry research firm STR. "The Chinese would argue that we can maybe attract a clientele that has not been with you before."
When completed, the complex is set to boast brands such as the Grand Hyatt, Rosewood and Mondrian, and 313 $1-million condos being marketed to the international elite.
Business leaders have openly questioned the investment as Baha Mar rises just blocks from storefronts left empty during the latest downturn. The Wyndham hotel was closed for all of September and most of October with low occupancy levels, and on Feb. 8 announced the need for "substantial cutbacks," including layoffs.
"In a vibrant economy, we wouldn't be having any concerns. The reason it comes into question is whether it's right at this time," said Winston Rolle, CEO of the Bahamas' Chamber of Commerce.
The project had, in fact, been conceived in a different moment, more than five years ago, when the U.S. housing boom and global tourism seemed unstoppable.
One of the original developers, Caesar's Entertainment Corp., formerly Harrah's Entertainment, backed out of the project in 2008, and Chinese financiers stepped in after reaching a deal with project CEO Sarkis Izmirlian. The agreement brought in a state-owned Chinese construction company to build the resort.
"This project is essential to developing business in the Caribbean and into the U.S.," said Tiger Wu, vice president of the construction company, told Bahamian media. "It's only the beginning."
All evidence indicates the Chinese are charging forward. They've made their $3.5 billion gamble in the Bahamas. Elsewhere, they have promised tens of billions for everything from dams to railroads. Guyana has hired the state-owned Shanghai Construction Group to build a 197-room Marriott Hotel on the southern edge of the Caribbean.
Meanwhile, traditional investors in the U.S. and Europe have been left on the sidelines. It's China's game now. And the rest of the world is waiting to see how the big gambles pay off.
Elsewhere around the Caribbean, as hotels were struggling to stay afloat in the global economic slowdown, the Chinese response was to bankroll the biggest resort under construction in the Western Hemisphere — a massive hotel, condominium and casino complex in the Bahamas just a few miles from half-empty resorts.
All over the world, from Latin America to the South Pacific, a cash-flush China is funding projects that others won't, seemingly less concerned by the conventional wisdom of credit ratings and institutions such as the World Bank.
___
EDITOR'S NOTE — This story is part of "China's Reach," a project tracking China's influence on its trading partners over three decades and exploring how that is changing business, politics and daily life. Keep up with AP's reporting on China's Reach, and join the conversation about it, using the hashtag (hash)APChinaReach on Twitter.
___
The Chinese money is breathing life into government infrastructure projects that otherwise might have died for lack of financing. For commercial projects such as the Caribbean resort, China is filling a gap left by Western investors retrenching after the 2008 financial crisis.
But some in the Bahamas worry what will happen if the sprawling Baha Mar project fails. They picture an economy saturated with hotels, dragged down by an expensive Chinese white elephant. Likewise, the infrastructure loans are loading financially shaky countries with more debt and letting them avoid economic reforms that other lenders would likely have demanded.
"The Chinese play by other rules," said Kevin Gallagher, a Boston University international relations professor who has studied Chinese lending to Latin America. "We'll give you financing with no conditions, and we'll finance things the International Monetary Fund won't fund, things others won't fund anymore, like big infrastructure projects. It allows countries to shop around, which has good and bad sides."
Venezuelan leader Hugo Chavez talked up his independence last year while highlighting another $4 billion in Chinese loans, part of a wave of money that has translated into new railways, utilities and other projects.
"In a few days, they're going to deposit 4 billion little dollars more from Beijing," Chavez told reporters, holding up four fingers for emphasis.
"Fortunately, we don't depend on the dreadful bank. What's that one called that you mentioned? The World Bank. Poor are those countries that depend on the World Bank, the International Monetary Fund."
Venezuela's Oil and Mining Minister Rafael Ramirez says China has loaned his country $36 billion since 2008, and others put the figure even higher. The Spanish-language version of a report co-authored by Gallagher, "The New Banks in Town: Chinese Finance in Latin America," estimates it at $46.5 billion.
The loans have added to Venezuela's $95.7 billion in public foreign debt as of mid-2012, which has risen even as the country rakes in record-high oil revenue. Some analysts say the spending helped Chavez win re-election in October, despite battling cancer.
China has emerged in recent years as the largest provider of development loans not only to Venezuela but also to Ecuador and Argentina, according to the Gallagher report. All three are junk bond countries, ratings agencies say. In contrast, the World Bank and Inter-American Development Bank remain larger lenders in Brazil and Mexico, both countries with higher bond ratings.
In cases such as the tiny South Pacific islands of Tonga, China is lending enormous sums to countries few expect will be able to repay.
What has surely given the Chinese banks courage is the trillions of dollars in reserves the country holds in U.S. Treasury bonds, investments that pay almost nothing in interest. Making that money work harder for a return overseas has become nothing less than a national priority, part of China's trumpeted "going out" strategy.
___
China's economy is the second largest after the U.S., and many of the deals stipulate repayment in oil and natural gas, locking in the commodities China will need to sustain its growth for decades to come.
In 2009 and 2010 alone, the China Development Bank extended $65 billion in such loans to energy companies and government entities from Ecuador to Russia and Turkmenistan, according to a report by Erica Downs, a China expert at the Brookings Institution, a U.S. think tank.
"If you're lending tens of billions of dollars to a borrower ..., you want to make sure that loan is secured against something," she said. "In the case of Venezuela, it's the most valuable thing they can offer. It's just one way to ensure they get paid."
In dozens of cases, the Chinese have also demanded that their own companies build the infrastructure that will help governments extract and ship the commodities used to pay back the loans. In Argentina, that means agreements to bring in Chinese companies to revamp the country's decrepit rail system, which would speed up shipments of soy to Chinese consumers.
"The money goes from one account in the China Development Bank into the hands of small- and medium-sized businesses in China," Gallagher said, while noting the majority involve big state companies.
The Chinese also hold a valuable trump card: They're betting that Chavez and other financial pariahs won't dare alienate their last source of affordable money by defaulting on Chinese loans or seizing Chinese assets.
"The Chinese have the upper hand," Downs said. "The China Development Bank sees this country that's thumbed their nose at the IMF. And if they borrowed from the IMF and had to be subjected to IMF conditionality, the regime would fall."
Perhaps with that in mind, more than 30 Chinese consultants toured Venezuela and handed Chavez a thick binder with recommendations on everything from exchange rate reform to agriculture.
While news cameras clicked, Chavez held up the book, thanked his Chinese benefactors and pledged to study the prescriptions. Unlike IMF loans, however, the Chinese recommendations weren't a requirement, and Chavez has shown no sign of curbing public spending.
The investments and loans have contributed to a substantial shift in commerce toward China. Venezuela, for example, saw its trade with the U.S. drop from 26 percent of its GDP in 2006 to 18 percent in 2011, according to an Associated Press analysis of IMF databases. Meanwhile, Chinese trade grew from virtually nothing in 2001 to nearly 6 percent a decade later, much of it in the form of oil to repay loans.
But the money doesn't necessarily save countries from their own bad financial bets.
Zimbabwe, which has received generous Chinese financing, saw inflation peak at 79.6 billion percent a month in November 2008. At one point, a loaf of bread reportedly cost 500 million Zimbabwe dollars. Gideon Gono, governor of the Reserve Bank of Zimbabwe, suggested one possible remedy: Adopt the Chinese yuan as the official currency. (Zimbabwe eventually overcame the crisis by switching to a mix of Western and African currencies.)
Argentina is fighting off an economic reckoning despite receiving more than $12 billion in Chinese loans, according to the Gallagher report. In 2001, the country defaulted on some $100 billion in loans. It struck a deal with most of its lenders, but over the past year, a group of creditors is insisting on payment in full.
"It's extremely concerning," said Margaret Meyers, a China expert at the U.S. think tank the Inter-American Dialogue. "Chinese financing won't be able to sustain these economies unless they go through substantial macroeconomic reforms. For Argentina, that means open markets, reforming institutions, reforming the banking system, fiscal accountability, ending lots of misspending."
Some in the borrowing countries have watched with worry as the Chinese bets play out.
Opposition politicians in Venezuela have slammed the deals for locking in contracts for everything from Chinese-made refrigerators to Chinese construction workers while giving Chavez free rein to spend billions of dollars.
"There's no doubt we're going to need China, they are an economic powerhouse," opposition leader Henrique Capriles said last year. "But many of the agreements the government has signed involve political loyalties that don't interest us."
___
On the beaches of New Providence in the Bahamas, hundreds of Chinese construction workers are toiling around the clock to ready the Baha Mar project for a phased opening scheduled to start in late 2014.
The project will add thousands of hotel rooms not far from the islands' biggest resort, the Atlantis.
"Going forward, we have to achieve a sustainable tourism product," said James Smith, the former state minister of finance for the Bahamas. "If we don't, Baha Mar could be cannibalizing Atlantis."
Baha Mar has opened sales offices all over Asia to promote and presell hundreds of pricey condos, hoping to imprint new travel habits on a continent that's traditionally spent beach vacations in Southeast Asia. It is also working with the Bahamian government to open more consular offices in China to issue visas.
"In general, you would assume that a project of that size is generating its own demand and the idea would probably also be with Chinese money comes an influx of Chinese travelers," said Jan Freitag, senior vice president of hospitality industry research firm STR. "The Chinese would argue that we can maybe attract a clientele that has not been with you before."
When completed, the complex is set to boast brands such as the Grand Hyatt, Rosewood and Mondrian, and 313 $1-million condos being marketed to the international elite.
Business leaders have openly questioned the investment as Baha Mar rises just blocks from storefronts left empty during the latest downturn. The Wyndham hotel was closed for all of September and most of October with low occupancy levels, and on Feb. 8 announced the need for "substantial cutbacks," including layoffs.
"In a vibrant economy, we wouldn't be having any concerns. The reason it comes into question is whether it's right at this time," said Winston Rolle, CEO of the Bahamas' Chamber of Commerce.
The project had, in fact, been conceived in a different moment, more than five years ago, when the U.S. housing boom and global tourism seemed unstoppable.
One of the original developers, Caesar's Entertainment Corp., formerly Harrah's Entertainment, backed out of the project in 2008, and Chinese financiers stepped in after reaching a deal with project CEO Sarkis Izmirlian. The agreement brought in a state-owned Chinese construction company to build the resort.
"This project is essential to developing business in the Caribbean and into the U.S.," said Tiger Wu, vice president of the construction company, told Bahamian media. "It's only the beginning."
All evidence indicates the Chinese are charging forward. They've made their $3.5 billion gamble in the Bahamas. Elsewhere, they have promised tens of billions for everything from dams to railroads. Guyana has hired the state-owned Shanghai Construction Group to build a 197-room Marriott Hotel on the southern edge of the Caribbean.
Meanwhile, traditional investors in the U.S. and Europe have been left on the sidelines. It's China's game now. And the rest of the world is waiting to see how the big gambles pay off.
Sunday, February 17, 2013
Obama Should Woo Japan to Join Pacific Trade Pact
Illustration by Brendan Monroe
Obama Should Woo Japan to Join Pacific Trade Pact
Now covering 11 economies that together conduct more than $1 trillion of trade each year, the TPP is a multinational free- trade agreement started by Brunei, Chile, Singapore and New Zealand a decade ago. The Obama administration notified Congress in late 2009 that it would be joining the talks.
In addition to eliminating tariffs, the TPP aims to confront nontariff issues such as the protection of intellectual property and the distorting effects of state-owned enterprises. Administration officials have expressed hope that the TPP would lay the foundation for an Asia-Pacific free-trade zone.
Although the TPP is a trade agreement, it has enormous geopolitical ramifications as a potential economic counterweight to the rise of China, which has been busy forging its own regional and bilateral agreements. In fact, Obama has repeatedly referred to the TPP as a critical part of his administration’s plans to “rebalance” U.S. foreign policy toward Asia. Yet Japan, the third largest economy in the world and the only Asian nation whose economy rivals China, hasn’t yet formally asked or been invited to join the TPP.
At least 36 killed in Hindu festival stampede
A terrifying stampede at a railway station left at least 36 people dead after the main day of India's Kumbh Mela religious festival, which drew record crowds of 30 million, officials said Monday.Dozens more were injured in the crush on Sunday evening at Allahabad, marking a tragic end to the most auspicious day of the 55-day Hindu festival in the northern state of Uttar Pradesh, the world's largest gathering of humanity.
Local officials said the railings on a bridge at the station had given way under the pressure of the mass of people, while witnesses said that police had baton-charged the crowd, triggering panic.
Injured people were stretchered away on ambulances from Allahabad station, but relatives said emergency services took hours to reach the scene. At least 10 corpses wrapped in white sheets could be seen on a platform several hours later.
Among the victims was an eight-year-old girl called Muskaan whose distraught parents said she had died while waiting for help for nearly two hours.
"Our daughter still had a pulse. Had the doctors reached in time she would have been saved, but she died before our eyes," Bedi Lal, the child's father, told the NDTV news channel.
Amit Malviya, a spokesman for the northern and central railway, told AFP on Monday that 20 bodies had been identified and authorities were waiting for relatives to come forward to claim another 16.
Apart from Muskaan, the victims included 26 women and nine men. The oldest was a 75-year-old man, Malviya said.
Hollande ‘no travelling salesman’ on India visit
India and France are speeding up negotiations in a multibillion-dollar deal to build French fighter jets for the Indian air force on Thursday during a visit by French President François Hollande to New Delhi.Hollande and Indian Prime Minister Manmohan Singh held talks in the capital that also focused on defense, regional security and cooperation in space exploration. A $9.3-billion agreement for French energy giant Areva to construct the world’s biggest civilian nuclear power complex in western India was also being fine-tuned.
But despite the numerous contracts up for discussion, including the purchase by India of 126 Rafale fighter jets for $11 billion, President Hollande stressed that his visit was a diplomatic one.
“There will be contracts signed by companies,” he told FRANCE 24 in an exclusive interview. “But it’s not the state that signs contracts. We can give our support, we can accompany them, we can give an idea of what's on our mind, but from there on it's the companies, using their technological capacities, and the quality of their products and also their market savvy that land the contracts.”
Hollande stressed France’s “special relationship” with India, whose vast market for energy could prove massively lucrative to the world’s biggest nuclear producer. France is already one of the largest suppliers of nuclear fuel to India.
“I do sense a connection between France and India,” Hollande said. “India expects much of France – not just in economic terms, but also culturally and politically. [...] We complement each other very significantly, because we can come together in the field of technology and in politics we can shape the world,” he said.
What's Kim Jong Un's intention with the nuclear test?
(CNN) -- On Tuesday, the international community reacted to North Korea's third nuclear test by calling its action "provocative," while South Korea's foreign minister warned that it was a "clear threat to international peace and security."
It was what Kim Jong Un, the nation's young leader, wanted.
From the North Korean
government's view, the more pressure the international community places
on its nuclear testing, the better. They enjoy the chatter among the
world's leaders and at the U.N. about how North Korea's nuclear program
must be stopped at all cost.
On January 23,
the North Korean foreign ministry notified that they intended to carry
out a test. They also sent photos of Kim Jong Un holding a meeting with
senior officials.
If Kim had not acted by
going through with the underground blast, it would have appeared that he
had succumbed to pressure from the international community. In North
Korea the authority of the "king" in the dynasty system cannot be
compromised.
The date of the nuclear test -- conducted on February 12
-- is also significant, as it fell just days short of the 71st birthday
of Kim's late father, Kim Jong Il, on February 16. Many North Korean
events are associated with symbolic dates for the Kim family. On December 12,
just days before the first anniversary of Kim Jong II's death,
Pyongyang launched its first rocket into orbit -- despite international
uproar
Rescuers struggle to aid Philippines storm victims
(CNN) -- Rescue crews in the Philippines grappled with washed-out roads, downed power lines and poor communications in search of hundreds of people missing after a typhoon that killed more than 300.
More than 180,000 people were left homeless after Typhoon Bopha
raked the large southern island of Mindanao with heavy rains and
sustained winds of up to 175 kph (110 mph). As of Thursday morning, the
storm had left 325 dead, 411 injured and 379 missing, the Philippines
National Disaster Risk Reduction and Management Council reported.
Many of the missing were
in remote highland towns. The storm wiped out the mountain village of
Baculin and killed at least half of the residents of nearby Kinablangan,
the official Philippines News Agency reported Wednesday. Bopha also
severely damaged almost all of the homes in the villages of Boston,
Cateel and Baganga, Davao Oriental Gov. Corazon Malanyaon told PNA.
Bopha, known in the
Philippines as Pablo, continued to work its way through the island
nation Wednesday, making its fourth landfall in the northwestern
province of Palawan, PNA reported.
The storm had begun to
move offshore by Wednesday afternoon, but continued to wash Palawan with
heavy rain. It wasn't expected to fully clear the Philippines until
Thursday.
It left chaos and death in its wake.
At one point, at least
319 people were missing in the Mindanao town of New Bataan alone, CNN
affiliate ABS-CBN reported, citing Interior and Local Government
Secretary Mar Roxas.
"Entire families may have been washed away," ABS-CBN quoted him as saying.
At least 180,000 people
were living in shelters, according to the National Disaster Risk
Reduction and Management Council, the federal emergency management
agency. The Philippine Red Cross put the number at 216,000.
Philippines seeks peaceful solution to Borneo stand-off
Philippines seeks peaceful solution to Borneo stand-off
Malaysian policemen return from a sea patrol in Tanjung Labian near Lahad Datu, on the Malaysian island of Borneo, on February 16, 2013. The Philippines called for a peaceful resolution to a tense stand-off in a remote area on Borneo island in Malaysia, where hundreds of armed Filipinos landed on Tuesday.
Local policemen conduct a security check near the village of Bakapit, near Lahad Datu, on the Malaysian island of Borneo, on February 14, 2013. The Philippines on Saturday called for a peaceful resolution to a tense stand-off between Malaysian forces and a group of gunmen claiming to be followers of the heir of a former Borneo sultan.
New Zealand dolphin faces extinction, group warns
New Zealand dolphin faces extinction, group warns
Campaigners dressed as dolphins call on New Zealand Prime Minister John Key to help save the critically endangered Maui's dolphin, in Wellington, on May 2, 2012. Scientists have also urged New Zealand to take immediate action to protect the animal.
UN Security Council vows action after North Korea test
The United Nations Security Council on Tuesday ‘strongly condemned’ North Korea’s third nuclear test and vowed to take action, the president of the council said. Pyongyang is already under a heavy sanctions regime due to its earlier atomic tests.
North Korea confirms 'successful' nuclear test
North Korea has confirmed that it "successfully" carried out a third nuclear test, drawing immediate condemnation from world powers. The UN Security Council will hold an emergency meeting on Tuesday to debate a response.
Friday, February 15, 2013
India hangs man linked to 2001 Parliament attack
A Kashmiri man convicted of plotting the deadly 2001 attack on India’s Parliament was hanged on Saturday, officials said. The news sparked protests in Indian Kashmir, where several groups claim the man did not get a fair trial.
A Kashmiri man convicted in a 2001 attack on India’s Parliament that left 14 people dead was hanged Saturday in an Indian prison after a final mercy plea was rejected, a senior Indian Home Ministry official said.
Home Secretary R.K. Singh told reporters that Mohammed Afzal Guru was executed early Saturday morning in New Delhi’s Tihar prison.
“It was the law taking its course,” Singh said.
Guru was given a Muslim burial in the prison compound, Press Trust of India news agency reported. His family in the Indian state of Jammu and Kashmir has demanded that his body be handed over, but that seems unlikely given the highly sensitive nature of the execution.
Protests broke out Saturday in three parts of Indian Kashmir, including the northwestern town of Sopore, which was Guru’s home. Scores of protesters defied a curfew and clashed with police and paramilitary troops who opened fire. Four protesters sustained bullet wounds and one of them was in critical condition, a senior police officer said on customary condition of anonymity.
Thousands of police and paramilitary troops fanned out across the state preparing for more protests and violence following the announcement of the execution. A curfew was also imposed in most parts of Jammu and Kashmir state, and cable television channels were cut off in the region.
Guru had been on death row since first being convicted in 2002. Subsequent appeals in higher courts were also rejected, and India’s Supreme Court set an execution date for October 2006. But his execution was delayed after his wife filed a mercy petition with India’s president. That petition, the last step in the judicial process, was turned down earlier this week.
Several rights groups, including political groups in Indian Kashmir, have said that Guru did not get a fair trial.
On Dec. 13, 2001, five gunmen entered the compound of India’s Parliament and opened fire. A gunbattle with security officers ensued and 14 people, including the gunmen, were killed. India blamed the Pakistan-based militant groups Lashkar-e-Taiba and Jaish-e-Mohammed.
The attack led to heightened tensions between India and its neighbor and archrival Pakistan and brought the neighbors to the brink of war, but tensions eased after intense diplomatic pressure from the international community and a promise by then-Pakistani President Gen. Pervez Musharraf to clamp down on the militants.
Guru confessed in TV interviews that he helped plot the attack, but later denied any involvement and said he was tortured into confessing.
Government prosecutors said that Guru was a member of Jaish-e-Mohammed, a charge Guru denied.
Guru’s family said it had not been told that he was about to be executed.
“Indian government has yet again functioned like a fascist state and hanged him secretly,” said Yasin Guru, a relative who lives in the family’s compound in Sopore. “They did not have the courtesy to inform his family.”
When Guru’s death sentence was handed down by India’s Supreme Court it sparked protests in Kashmir, and the state government has warned that his execution could destabilize the volatile Himalayan region.
Anti-India sentiment runs deep in Muslim-majority Kashmir, which is divided between Hindu-dominated India and Muslim-majority Pakistan but is claimed by both nations.
Since 1989, an armed uprising in Indian-controlled Kashmir and an ensuing crackdown have killed an estimated 68,000 people, mostly civilians.
The secrecy in which Guru’s execution was carried out was similar to the execution in November of Mohammed Ajmal Kasab, the lone surviving gunman of the 2008 Mumbai attacks. Kasab was also buried in the western Indian prison where he was hanged.
Police in Indian Kashmir on Saturday also detained several leaders of the All Parties Hurriyat Conference, an umbrella organization of separatist political and religious groups, a police officer said on condition of anonymity because he wasn’t authorized to speak to reporters.
A Kashmiri man convicted in a 2001 attack on India’s Parliament that left 14 people dead was hanged Saturday in an Indian prison after a final mercy plea was rejected, a senior Indian Home Ministry official said.
Home Secretary R.K. Singh told reporters that Mohammed Afzal Guru was executed early Saturday morning in New Delhi’s Tihar prison.
“It was the law taking its course,” Singh said.
Guru was given a Muslim burial in the prison compound, Press Trust of India news agency reported. His family in the Indian state of Jammu and Kashmir has demanded that his body be handed over, but that seems unlikely given the highly sensitive nature of the execution.
Protests broke out Saturday in three parts of Indian Kashmir, including the northwestern town of Sopore, which was Guru’s home. Scores of protesters defied a curfew and clashed with police and paramilitary troops who opened fire. Four protesters sustained bullet wounds and one of them was in critical condition, a senior police officer said on customary condition of anonymity.
Thousands of police and paramilitary troops fanned out across the state preparing for more protests and violence following the announcement of the execution. A curfew was also imposed in most parts of Jammu and Kashmir state, and cable television channels were cut off in the region.
Guru had been on death row since first being convicted in 2002. Subsequent appeals in higher courts were also rejected, and India’s Supreme Court set an execution date for October 2006. But his execution was delayed after his wife filed a mercy petition with India’s president. That petition, the last step in the judicial process, was turned down earlier this week.
Several rights groups, including political groups in Indian Kashmir, have said that Guru did not get a fair trial.
On Dec. 13, 2001, five gunmen entered the compound of India’s Parliament and opened fire. A gunbattle with security officers ensued and 14 people, including the gunmen, were killed. India blamed the Pakistan-based militant groups Lashkar-e-Taiba and Jaish-e-Mohammed.
The attack led to heightened tensions between India and its neighbor and archrival Pakistan and brought the neighbors to the brink of war, but tensions eased after intense diplomatic pressure from the international community and a promise by then-Pakistani President Gen. Pervez Musharraf to clamp down on the militants.
Guru confessed in TV interviews that he helped plot the attack, but later denied any involvement and said he was tortured into confessing.
Government prosecutors said that Guru was a member of Jaish-e-Mohammed, a charge Guru denied.
Guru’s family said it had not been told that he was about to be executed.
“Indian government has yet again functioned like a fascist state and hanged him secretly,” said Yasin Guru, a relative who lives in the family’s compound in Sopore. “They did not have the courtesy to inform his family.”
When Guru’s death sentence was handed down by India’s Supreme Court it sparked protests in Kashmir, and the state government has warned that his execution could destabilize the volatile Himalayan region.
Anti-India sentiment runs deep in Muslim-majority Kashmir, which is divided between Hindu-dominated India and Muslim-majority Pakistan but is claimed by both nations.
Since 1989, an armed uprising in Indian-controlled Kashmir and an ensuing crackdown have killed an estimated 68,000 people, mostly civilians.
The secrecy in which Guru’s execution was carried out was similar to the execution in November of Mohammed Ajmal Kasab, the lone surviving gunman of the 2008 Mumbai attacks. Kasab was also buried in the western Indian prison where he was hanged.
Police in Indian Kashmir on Saturday also detained several leaders of the All Parties Hurriyat Conference, an umbrella organization of separatist political and religious groups, a police officer said on condition of anonymity because he wasn’t authorized to speak to reporters.
At least 36 killed in Hindu festival stampede
At least 36 people died at India's Kumbh Mela religious festival in Uttar Pradesh state when a railing gave way at a train station in Allahabad on Sunday, triggering a stampede. Officials said this year's festival drew a record 30 million people.
A terrifying stampede at a railway station left at least 36 people dead after the main day of India's Kumbh Mela religious festival, which drew record crowds of 30 million, officials said Monday.
Dozens more were injured in the crush on Sunday evening at Allahabad, marking a tragic end to the most auspicious day of the 55-day Hindu festival in the northern state of Uttar Pradesh, the world's largest gathering of humanity.
Local officials said the railings on a bridge at the station had given way under the pressure of the mass of people, while witnesses said that police had baton-charged the crowd, triggering panic.
Injured people were stretchered away on ambulances from Allahabad station, but relatives said emergency services took hours to reach the scene. At least 10 corpses wrapped in white sheets could be seen on a platform several hours later.
Among the victims was an eight-year-old girl called Muskaan whose distraught parents said she had died while waiting for help for nearly two hours.
"Our daughter still had a pulse. Had the doctors reached in time she would have been saved, but she died before our eyes," Bedi Lal, the child's father, told the NDTV news channel.
Amit Malviya, a spokesman for the northern and central railway, told AFP on Monday that 20 bodies had been identified and authorities were waiting for relatives to come forward to claim another 16.
Apart from Muskaan, the victims included 26 women and nine men. The oldest was a 75-year-old man, Malviya said.
Hindus believe a dip in the sacred waters of the river Ganges cleanses them of their sins. This year's Mela is enormous even by previous standards, with astrologers saying a planetary alignment seen once every 147 years made it particularly auspicious.
Police had been stretched in controlling the vast crowds as they reached their peak on Sunday, with officials saying the numbers had passed the 30 million mark by the evening.
After the stampede, Indian Prime Minister Manmohan Singh issued a statement saying he was "deeply shocked" while the Chief Minister of Uttar Pradesh Akhilesh Yadav ordered an inquiry.
A spokesman for the state government said the crush began after joints broke on railings attached to the bridge.
"People were taking a rest on these railings and the railings could not take the load," Ashok Sharma, told AFP.
But Railways Minister Pawan Kumar Bansal, who headed to Allahabad after the accident, attributed the crush to sheer weight of number.
"No footover bridge collapsed, no railings collapsed," Bansal told reporters.
"We had provided for colour-coded enclosures to help people travelling in different directions.
"We got to know that there was huge crowd and those (enclosures) were broken down. Many thousands of people climbed the footover bridge. And as you know the consequences when stampedes happen."
The Kumbh Mela, which began last month and ends in March, takes place every 12 years in Allahabad while smaller events are held every three years in other locations around India.
In 2003, 45 people died in a stampede during the festival in the western Indian town of Nasik.
Crushes are a constant menace at religious events in India, where policing and crowd control are often inadequate.
The worst recent incident was in October 2008 when around 220 people died near a temple inside a famous fort in the northern city of Jodhpur.
At the Kumbh Mela on Sunday, 30,000 volunteers and 7,000 police were on duty, urging pilgrims to take one short bath and then leave the waters to make space for the flow of humanity that stretched for kilometres (miles).
The event has its origins in Hindu mythology, which describes how a few drops of the nectar of immortality fell on the four places that host the festival -- Allahabad, Nasik, Ujjain and Haridwar.
A terrifying stampede at a railway station left at least 36 people dead after the main day of India's Kumbh Mela religious festival, which drew record crowds of 30 million, officials said Monday.
Dozens more were injured in the crush on Sunday evening at Allahabad, marking a tragic end to the most auspicious day of the 55-day Hindu festival in the northern state of Uttar Pradesh, the world's largest gathering of humanity.
Local officials said the railings on a bridge at the station had given way under the pressure of the mass of people, while witnesses said that police had baton-charged the crowd, triggering panic.
Injured people were stretchered away on ambulances from Allahabad station, but relatives said emergency services took hours to reach the scene. At least 10 corpses wrapped in white sheets could be seen on a platform several hours later.
Among the victims was an eight-year-old girl called Muskaan whose distraught parents said she had died while waiting for help for nearly two hours.
"Our daughter still had a pulse. Had the doctors reached in time she would have been saved, but she died before our eyes," Bedi Lal, the child's father, told the NDTV news channel.
Amit Malviya, a spokesman for the northern and central railway, told AFP on Monday that 20 bodies had been identified and authorities were waiting for relatives to come forward to claim another 16.
Apart from Muskaan, the victims included 26 women and nine men. The oldest was a 75-year-old man, Malviya said.
Hindus believe a dip in the sacred waters of the river Ganges cleanses them of their sins. This year's Mela is enormous even by previous standards, with astrologers saying a planetary alignment seen once every 147 years made it particularly auspicious.
Police had been stretched in controlling the vast crowds as they reached their peak on Sunday, with officials saying the numbers had passed the 30 million mark by the evening.
After the stampede, Indian Prime Minister Manmohan Singh issued a statement saying he was "deeply shocked" while the Chief Minister of Uttar Pradesh Akhilesh Yadav ordered an inquiry.
A spokesman for the state government said the crush began after joints broke on railings attached to the bridge.
"People were taking a rest on these railings and the railings could not take the load," Ashok Sharma, told AFP.
But Railways Minister Pawan Kumar Bansal, who headed to Allahabad after the accident, attributed the crush to sheer weight of number.
"No footover bridge collapsed, no railings collapsed," Bansal told reporters.
"We had provided for colour-coded enclosures to help people travelling in different directions.
"We got to know that there was huge crowd and those (enclosures) were broken down. Many thousands of people climbed the footover bridge. And as you know the consequences when stampedes happen."
The Kumbh Mela, which began last month and ends in March, takes place every 12 years in Allahabad while smaller events are held every three years in other locations around India.
In 2003, 45 people died in a stampede during the festival in the western Indian town of Nasik.
Crushes are a constant menace at religious events in India, where policing and crowd control are often inadequate.
The worst recent incident was in October 2008 when around 220 people died near a temple inside a famous fort in the northern city of Jodhpur.
At the Kumbh Mela on Sunday, 30,000 volunteers and 7,000 police were on duty, urging pilgrims to take one short bath and then leave the waters to make space for the flow of humanity that stretched for kilometres (miles).
The event has its origins in Hindu mythology, which describes how a few drops of the nectar of immortality fell on the four places that host the festival -- Allahabad, Nasik, Ujjain and Haridwar.
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