Journalists invited to cover upcoming NPC, CPPCC sessions. The Chinese government has invited both Chinese and foreign journalists (including journalists from Taiwan) to cover the sessions of both the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) to be held in early March. This is a big deal–especially the CPPCC meetings–in China’s steps to bring more sunlight into the political process. Great move.
Chinese may OK property rights law. In chairman Mao’s days, all property was owned by the government. In 2004, the Constitution was amended to include the protection of private property, although enforcement of the right has remained ambiguous. This has led to many disputes between Chinese and foreign companies and local political authorities, who sometimes abused the system for their own profits. And it led to situations where local officials forcibly appropriated land from farmers with little or no compensation, worsening the growing tensions between rural and urban China.
Under the Constitution, state-owned property is seen as both sacred and inviolable, but the protection of private property is limited to that deemed “legal.” The new law will provide that legal framework. Private property will have the same legal status as that held by the state or the public, and the law will require that authorities provide appropriate, i.e., market-priced, compensation to people whose land has been seized.
This law will reduce the risk of investing in China for foreign investors, attract more capital into China. This is great for China.
But America take note. The capital that will come into China must come out of some other place. Capital is the source of jobs, productivity, and paychecks. We need government policies that will keep the capital within our borders.
Charities left high and dry. My friend Cheng Siwei, vice chairman of the Standing Committee of the National People’s Congress, has been making waves last week. His comments about the over-heated Chinese stock market had a huge impact on the markets. He also talked about widespread corporate irresponsibility, including both direct malfeasance, such as ignoring health and safety standards in coal mines, and failing to engage in charitable social activities, as you will read in this article in Hong Kong’s The Standard.
I will write more about Cheng Siwei later. I met with him 2 weeks ago in the Chinese White House to receive my formal appointment as Honorary Professor at the Schinese Academy of Sciences (CAS), where Cheng Siwei is the Dean of the CAS Graduate University’s School of Management. After the ceremony, we had the most extraordinary conversation about economics, finance, physics and chemistry. More on the remarkable man leter today.