China Toughens Restrictions on Internet Use

The decision came as government censors have sharply stepped up restrictions on China’s international Internet traffic in recent weeks. The restrictions are making it harder for businesses to protect commercial secrets and for individuals to view overseas Web sites that the Chinese Communist Party deems politically sensitive.

The new regulations, issued by the Standing Committee of the National People’s Congress, allow Internet users to continue to adopt pseudonyms for their online postings, but only if they first provide their real names to service providers, a measure that could chill some of the vibrant discourse on the country’s Twitter-like microblogs. The authorities periodically detain and even jail Internet users for politically sensitive comments, such as calls for a multiparty democracy or accusations of impropriety by local officials.

Any entity providing Internet access, including over fixed-line or mobile phones, “should when signing agreements with users or confirming provision of services, demand that users provide true information about their identities,” the committee ordered.

In recent weeks, Internet users in China have exposed a series of sexual and financial scandals that have led to the resignations or dismissals of at least 10 local officials. International news media have also published a series of reports in recent months on the accumulation of wealth by the family members of China’s leaders, and some Web sites carrying such reports, including Bloomberg’s and the English- and Chinese-language sites of The New York Times, have been assiduously blocked, while Internet comments about them have been swiftly deleted.

The regulations issued Friday build on a series of similar administrative guidelines and municipal rules issued over the past year. China’s mostly private Internet service providers have been slow to comply with them, fearing the reactions of their customers. The committee’s decision has much greater legal force, and puts far more pressure on Chinese Internet providers to comply more quickly and more comprehensively, Internet specialists said.

In what appeared to be an effort to make the decision more palatable to the Chinese public, the committee also included a mandate for businesses in China to be more cautious in gathering and protecting electronic data.

“Nowadays on the Internet there are very serious problems with citizens’ personal electronic information being recklessly collected, used without approval, illegally disclosed, and even traded and sold,” Li Fei, a deputy director of the committee’s legislative affairs panel, said on Friday at a news conference in Beijing. “There are also a large number of cases of invasive attacks on information systems to steal personal electronic information, as well as lawbreaking on the Internet through swindles and through defaming and slandering others.”

Mr. Li denied that the government was seeking to prevent the exposure of corruption.

“When citizens exercise these rights according to the law, no organization or individual can use any reason or excuse to interfere, and cannot suppress them or exact revenge,” he said. “At the same time, when citizens exercise their rights, including through use of the Internet, they should stay within the bounds of the Constitution and the laws, and must not harm the legitimate rights and interests of the state, society, the collective or of other citizens.”

A spokesman for the National People’s Congress said that 145 members of the committee voted in favor of the new rules, with 5 abstaining and 1 voting against them.

The requirement for real names appeared to be aimed particularly at cellphone companies and other providers of mobile Internet access. At the news conference, an official from the Ministry of Industry and Information Technology, Zhao Zhiguo, said that nearly all fixed-line services now had real-name registration, but that only about 70 percent of mobile phones were registered under real names.

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World's Longest High-Speed Rail Line Opens in China

HONG KONG — China began service Wednesday morning on the world’s longest high-speed rail line, covering a distance in eight hours that is about equal to that from New York to Key West, Florida, or from London across Europe to Belgrade.

Bullet trains traveling 300 kilometers an hour, or 186 miles an hour, began regular service between Beijing and Guangzhou, the main metropolis in southeastern China. Older trains still in service on a parallel rail line take 21 hours; Amtrak trains from New York to Miami, a shorter distance, still take nearly 30 hours.

Completion of the Beijing-Guangzhou route is the latest sign that China has resumed rapid construction on one of the world’s largest and most ambitious infrastructure projects, a network of four north-south routes and four east-west routes that span the country.

Lavish spending on the project has helped jump-start the Chinese economy twice: in 2009, during the global financial crisis, and again this autumn, after a brief but sharp economic slowdown over the summer.

The hiring of as many as 100,000 workers per line has kept a lid on unemployment even as private-sector construction has slowed down because of limits on real estate speculation. And the national network has helped reduce toxic air pollution in Chinese cities and curb demand for imported diesel fuel, by freeing up a lot of capacity on older rail lines for goods to be carried by freight trains instead of heavily polluting, costlier trucks.

But the high-speed rail system has also been controversial in China. Debt to finance the construction has reached nearly 4 trillion renminbi, or $640 billion, making it one of the most visible reasons total debt has been surging as a share of economic output in China, and approaching levels in the West.

Each passenger car taken off the older, slower rail lines makes room for three freight cars, because passenger trains have to move so quickly that they force freight trains to stop frequently. But although the high-speed trains have played a big role in allowing sharp increases in freight shipments, the Ministry of Railways has not yet figured out a way to charge large freight shippers, many of them politically influential state-owned enterprises, for part of the cost of the high-speed lines, which haul only passengers.

The high-speed trains are also considerably more expensive than the heavily subsidized older passenger trains. A second-class seat on the new bullet trains from Beijing to Guangzhou costs 865 renminbi, compared with 426 renminbi for the cheapest bunk on one of the older trains, which also have narrow, uncomfortable seats for as little as 251 renminbi.

Worries about the high-speed network peaked in July 2011, when one high-speed train plowed into the back of another near Wenzhou in southeastern China, killing 40 people.

A subsequent investigation blamed flawed signaling equipment for the crash. China had been operating high-speed trains at 350 kilometers an hour, and it cut the top speed to the current rate in response to that crash.

The crash crystallized worries about the haste with which China has built its high-speed rail system. The first line, from Beijing to Tianjin, opened a week before the 2008 Olympics; a little more than four years later, the country now has 9,349 kilometers, or 5,809 miles, of high-speed lines.

China’s aviation system has a good international reputation for safety, and its occasional deadly crashes have not attracted nearly as much attention. Transportation safety experts attribute the public’s fascination with the Wenzhou crash partly to the novelty of the system and partly to a distrust among many Chinese of what is perceived as a homegrown technology, in contrast with the Boeing and Airbus jets flown by Chinese airlines.

Japanese rail executives have complained, however, that the Chinese technology is mostly copied from them, an accusation that Chinese rail executives have strenuously denied.

The main alternative to trains for most Chinese lies in the country’s roads, which have a grim reputation by international standards. Periodic crashes of intercity buses kill dozens of people at a time, while crashes of private cars are frequent in a country where four-fifths of new cars are sold to first-time buyers, often with scant driving experience.

Flights between Beijing and Guangzhou take about three hours and 15 minutes. But air travelers in China need to arrive at least an hour before a flight, compared with 20 minutes for high-speed trains, and the airports tend to be farther from the centers of cities than the high-speed train stations.

Land acquisition is the toughest part of building high-speed rail lines in the West, because the tracks need to be almost perfectly straight, and it has been an issue in China as well. Although local and provincial governments have forced owners to sell land for the tracks themselves, there have been disputes over suddenly valuable land near rail stations, with the result that surprisingly few stores and other commercial venues have sprung up around some high-speed stations through which tens of thousands of travelers move every day.

Zhao Xiangfeng, a farmer in Henan Province, said a plan to build a minimall on his and six other farmers’ land near a station had been shelved indefinitely after he and three of the other farmers refused to lease the land for anything close to what the village leadership offered. He said he worried that local leaders might try strong-arm tactics against the farmers to force them to lease the land and revive the project.

The southern segment of the new high-speed rail line, from Guangzhou as far as Wuhan, has been open for nearly three years and already suffers from heavy congestion, which could limit the number of seats available for travel all the way to Beijing during peak hours. Regular travelers on the route said in interviews that the 800-seat trains are often sold out as many as 10 trains in advance on Monday mornings and Friday afternoons, even though the trains travel as often as every four minutes, and even lunchtime trains at midweek are often full as well.

Mia Li in Beijing contributed research.

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Pope Prays for Freedom in China and Peace in Syria

“May peace spring up for the people of Syria, deeply wounded and divided by a conflict which does not spare even the defenseless and reaps innocent victims,” Benedict said. “I appeal for an end to the bloodshed, easier access for the relief of refugees and the displaced, and dialogue in the pursuit of a political solution to the conflict.”

Wearing a short red cape lined with snow-white ermine and trimmed with gold embroidery, Benedict smiled as he offered Christmas greetings in 65 languages to thousands of faithful in Saint Peter’s Square. Marching bands from from the Italian armed forces and the Carabinieri police played festive anthems. During Christmas Eve Mass on Monday evening, the 85-year-old pontiff had appeared tired and his voice hoarse, but on Tuesday he appeared more vivacious as he delivered the traditional message, “Urbi et orbi” — to the city and the world.

He also addressed China, where in recent weeks the Vatican has been increasingly at odds with the government over the ordination of bishops, who cannot hold office without approval from the authorities, to the dismay of the Vatican.

“May the King of Peace turn his gaze to the new leaders of the People’s Republic of China for the high task which awaits them,” Benedict said. “I express my hope that, in fulfilling this task, they will esteem the contribution of the religions, in respect for each, in such a way that they can help to build a fraternal society for the benefit of that noble people and of the whole world.”

Aggravating tensions, the Chinese Bishops’ Council, a government entity, stripped Thaddeus Ma Daqin, 45, the auxiliary bishop of Shanghai, of his title this month, according to Catholic Web sites that cited sources in the Chinese church.

The bishop had been under house arrest since he shocked Communist Party officials and his faithful by renouncing his government position during his consecration in July. In recent years, China’s Patriotic Catholic Association, which does not recognize the authority of the pope, has consecrated a number of bishops over the Vatican’s objections, resulting in their excommunication.

On Tuesday, Benedict asked God to give Israelis and Palestinians the “courage to end to long years of conflict and division, and to embark resolutely on the path of negotiation” and called for peace in Egypt, “land where the Redeemer was born.”

The pope also urged “the return of peace in Mali and that of concord in Nigeria, where savage acts of terrorism continue to reap victims, particularly among Christians.” He prayed for “the refugees from the east of the Democratic Republic of Congo,” and for peace to Kenya, “where brutal attacks have struck the civilian population and places of worship.”

On Monday evening, communicating through his new Twitter handle, @Pontifex, Benedict recalled that as a boy he loved his family’s Christmas crèche, and asked his followers what their favorite Christmas traditions were. “The cribs that we built in our home gave me much pleasure,” his message read. “We added figures each year and used moss for decoration.”

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Dirty money costs developing world $6 trillion, led by China: report

WASHINGTON, Dec 17 (TrustLaw) - Crime, corruption and tax evasion have cost the developing world nearly $6 trillion over the past decade, and illicit funds keep growing, led by China, a financial watchdog group said in a new report.

China accounted for almost half of the $858.8 billion in dirty money that flowed into tax havens and Western banks in 2010, more than eight times the amounts for runner-ups Malaysia and Mexico. Total illicit outflows increased by 11 percent from the prior year, Global Financial Integrity, a Washington-based group that campaigns for financial accountability, said in its latest report released on Monday.

"Astronomical sums of dirty money continue to flow out of the developing world and into offshore tax havens and developed country banks," said Raymond Baker, director of GFI.

"Developing countries are hemorrhaging more and more money at a time when rich and poor nations alike are struggling to spur economic growth. This report should be a wake-up call to world leaders that more must be done to address these harmful outflows," he said.

All the countries in the top 10, which this year saw India, Nigeria, the Philippines and Nigeria join the ranks, face significant problems with corruption, and in most there are vast gaps between rich and poor citizens as well as internal security problems.

Leaders of the Group of 20 major economies increasingly are focusing on ways to crack down on money laundering, bank secrecy and tax loopholes to prevent funds stolen from public coffers or earned through criminal activity from depleting the budgets of developing countries.

The sums are so huge that for every dollar in foreign direct aid, $10 leaves developing countries.

China lost $420.4 billion in 2010 and over the decade lost a total of $2.74 trillion. And its losses are steadily rising. In an October report, GFI said another $602 billion in illicit flows left China in 2011 for a total of $3.79 trillion between 2000-11.

However, the numbers in the latest report are not directly comparable with earlier data because GFI has updated its methodology, making the estimates somewhat more conservative. It measures illicit flows by calculating the difference between fund inflows from loans and net foreign direct investment, and the outflows from a country to pay for trade, cash transfers and other earnings.

Aware of the destabilizing impact of corrupt money, Chinese leaders are embarking on a crackdown. Outgoing President Hu Jintao recently warned corruption threatens to destroy the communist party and the state. In Russia, President Vladimir Putin last week also put the issue high on his agenda as citizen protests over corruption mount.

"Our report continues to demonstrate that the Chinese economy is a ticking time bomb," said Dev Kar, GFI's lead economist, who compiled the report. "The social, political and economic order in that country is not sustainable in the long run given such massive illicit outflows."

Mexico lost $51.17 billion in illicit flows in 2010 for a total of $476 billion over the last decade, which does not even count the billions of dollars in bulk cash that probably left under organized crime and drug dealing. Malaysia, an export-dominated economy with a wealthy elite, lost $64.38 billion in 2010 and $285 billion cumulatively between 2001 and 2010, the report said.

Illicit financial flows have grown by 13.3 percent a year since 2001, robbing countries of wealth and benefiting a handful of corrupt leaders. Kar said the worsening picture over the past decade coincides with the globalization of finance and loosening of capital controls, changes that make it easier to transfer funds to Western banks and to tax havens.

"Until governance improves and measures to shrink the underground economy take hold, we will not see a sustained decline in illicit flows," Kar said.

GFI called on world leaders to accelerate efforts to curtail the flow of dirty money by clamping down on secret bank accounts and ownership of shell companies; reforming customs and trade protocols so that export/import payments cannot be used to hide illegal fund transfers; requiring multinational companies to report their profits by country to prevent tax avoidance; and strongly enforcing anti money-laundering laws.

(Reporting by Stella Dawson; Editing by Leslie Adler)

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