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Historic floods test the Three Gorges Dam. A Dalian oil spill rivals Exxon Valdez. China becomes largest energy consumer, and the second largest economy. Chinese banks are at risk for crash. Parents are banned from snooping on children’s computers. And will Chinese teens get their own Gossip Girl?
Top News:China experienced its worst flooding in over a decade. Already in 2010, floods killed 928 people with 477 missing and caused tens of billions of dollars in damage. The floods have been the first big test for the Three Gorges Dam, which was supposed to stem flooding on the Yangtze River. While it hasn’t been completely effective in flood control, it has stayed structurally sound, a major worry for critics of the dam.
Dalian, known as the most livable city in China, experienced a manmade disaster that could severely hurt its reputation. A massive oil spill, called the country’s biggest in history, caused by two explosions at a pipeline has officially leaked 1,500 tons of crude into Bohai Bay. An unofficial estimate by American expert Rick Steiner puts the real spill at a far higher level, maybe even 90,000 tons, or about twice as big as the Exxon Valdez disaster.
If it seems like there’s lots of news from China about environmental disasters, it’s because there are a lot more of them. According to the State Environmental Protection Agency, the number of environmental accidents rose 98 percent in the first six months of the year. The ministry explained that China’s economic growth is leading “to increasing conflicts with the capacity of the environment to absorb” the demands.
China has surpassed the United States to become the world’s largest energy consumer, according to the International Energy Agency. The country hit the milestone far earlier than expected, with its demand for energy doubling since 2000. However, per capita consumption still remains a low compared to developed countries.
Not surprisingly, China’s air pollution is again getting worse. After improving slightly in past years, the first quarter of 2010 saw the first rise in air pollution since 2007. Officials have said that it is now as bad as 2005 levels, way before the Olympic push for a greener China.
The Shanghai Metro is getting too crowded. This month, officials expect the system to reach 7 million passengers a day. As a result of some recent deaths due to overcrowding in the subway, the government is now going to limit passenger numbers at four stations. At one stop, Nanjing Dong Lu, an astounding 144 people enter the station every minute.
But it’s not just the metro that’s getting crowded. China’s middle class is expected to reach 700 million people by 2020, or half the population, according to a Euromonitor report. Right now only about one quarter of the country is considered middle class, way below the US rate of 80 percent.
In a very unexpected new law, parents in Chongqing are now banned from snooping on to their children’s computers or text messages. Law experts say the law is hollow as it is unlikely that the kids will be able to bring their parents to court. It seems the government wants exclusive rights for snooping into text messages and web searches.
Parents looking for compensation after their children were killed by tainted vaccines were severely beaten outside the Ministry of Health in Beijing. After chaining themselves together and holding up signs asking for an explanation of the tainted vaccine scandal, public security bureau officers came out and beat them breaking bones. The protestors were taken away and have thus far been refused medical treatment.
Money:China’s chief currency regulator said that China has now overtaken Japan to become the world’s second largest economy. Rapid growth for over forty years has pushed China past the economies of France, Britain, Germany and Japan in the 2000s. According to World Bank estimates, China’s economy, assuming continued growth, will surpass the United States economy by 2025.
However, some economists don’t believe continued growth is in the cards for China. Patrick Chovanec at the Business Insider has written an in-depth article exposing the risks within the Chinese banking system. He believes that a financial instrument called a Local Government Financial Vehicle is piling up bad loans on bank’s balance sheets. An LGFV is essentially a subprime loan to local development entities related to the stimulus package, and like subprime loans in the US have then been touted by banks as super safe investments. Time will tell if Chovanec’s worries come to fruition.
Warren Buffet might be passing control of Berkshire Hathaway to Chinese born hedge fund manager Li Lu. Buffet has said that he will split his role into a CEO and an investment head once he retires and Li is the top candidate for the investment post.
Chinese automaker Geely has received government approval to buy Volvo from Ford. Geely will pay $1.8 billion for the brand, but will keep Volvo’s headquarters in Sweden.
Elsewhere: Chinese fans of Gossip Girl might soon get a local version to satisfy their appetite for rich teen intrigue. The creator Josh Schwartz said that he might begin developing a Chinese version of the show. Apparently more Chinese people watch Gossip Girl illegally online than people in the US watch it in any form.
A Shanghai landmark is now reopened. The Peace Hotel, built in the 1920s by Victor Sassoon and equivalent to a Shanghai version of the Plaza Hotel, was closed for three years for renovations. If you’re in town check out the updated version or if not look at the picture tour compiled by Malcolm Moore of the Telegraph.