Federer at the
US Open to lift
his 10th career
grand slam title
Boss of P2P
Dianrong aims to
shake up mainland
> S P O R T C14
> C H I NA A 6
Heat is on
Climate change experts
forecast rise in temperatures
> WO R L D A 9
to last months
> NEWS A3, FOCUS A4
Tuesday, September 15, 2015 / See live updates at www.scmp.com
PUBLISHED SINCE 1903 / VOLUME 71 / NO 256
ONLY NOT FOR SALE
INTO PRICE WAR
Slower economic growth and market saturation
take the spark out of the automation sector,
putting the squeeze on makers profit margins
Profits are falling for makers of
industrial robots in Guangdong
as a slowdown in economic
growth weighs on demand.
With a price war already
under way, a senior salesman at
LXD Robotics, one of the biggest
robot manufacturers in Foshan
, forecast that only 5 per
cent of the makers of the
machines in the province would
survive the next two years.
This despite claims that the
nation is in the throes of an automation revolution, with manufacturers looking to robotics to
overcome labour shortages and
spur innovation as wages rise.
Earlier this year, Guangdong
authorities said they would
spend 943 billion yuan (HK$1.1
trillion) to replace human labour
with the devices within the next
As a result, many robot manufacturers set overly ambitious
targets, with investment tipped
to hit a record high.
But much of that optimism
faded as sales targets were
missed and revenue streams
started drying up.
In April, LXD Robotics salesman He Zexian forecast that his
companys annual output this
year would reach 300 million
yuan, well up on the 20 million
yuan in 2013.
LXDs polishing and
burnishing robots cost up to
this much each, in yuan
He had since halved this estimate, he said on Thursday at the
Guangdong International Internet Plus Exposition and International Robotics and Intelligent
Equipment Industry Conference
Competition has become
more and more fierce, He said.
Most manufacturers of industrial robots have been forced to
engage in a price war.
LXDs robots are used in jobs
hazardous to human health,
such as polishing, welding and
moving heavy freight. The companys polishing and burnishing
robots cost between 800,000
yuan and 1.5 million yuan each,
but they could replace up to six
people, the company said.
The price of many models is
being cut every three months,
He said. Those that sold for
150,000 yuan last year now go for
He said the market was saturated and there was a shortage of
core technology needed to independently produce high-end
Most Chinese companies operating in this field were producing lower-quality robots using
imported components, He said.
The export-led manufacturing boom in Guangdong is over,
said Zeng Qingzong, sales manager of Foshan Jiefeng Industrial
Automation, a maker of welding,
stamping and polishing robots.
Exports are getting worse by
He Zexian said about 400
companies were making the machines on the mainland last year,
with about 60 per cent generating
> CONTINUED ON A3
Malcolm Turnbull and deputy leader Julie Bishop after the Liberal Party ballot. Turnbull will replace Tony Abbott as prime minister. Photo: AP
Abbott loses leadership to long-time rival Turnbull
Associated Press in Canberra
Australian Prime Minister Tony
Abbott yesterday lost a challenge
for leadership of the ruling Liberal Party to long-time rival
Malcolm Turnbull after months
of poor poll ratings.
Turnbull, a former lawyer, investment banker and entrepreneur, won a secret ballot of the
partys parliamentary members
by 54 votes to 44. In a surprise
move, Turnbull requested the
vote in a meeting with Abbott
earlier in the day.
In comments to reporters
after winning the ballot, Turnbull
paid tribute to Abbott, saying the
nation owed a great debt to him.
Tony has discharged that as
leader of the party and, of course,
as prime minister over many
years now and the achievements
Visitors look at industrial robots on display at an expo in Foshan, Guangdong province. Photo: Xinhua
Lawyers demand clarity
on separation of powers
Bar Association takes top Beijing official to task
for saying chief executive has overriding control
The Bar Association attacked Beijings top official in Hong Kong
for saying separation of powers
as prescribed under the Basic
Law did not apply in the city.
It urged Zhang Xiaoming
, director of the central
governments liaison office, to
explain his remarks last week that
the chief executive possesses a
special legal position that transcends the executive, the legislature and the judiciary, and that
the separation of powers applied
only to sovereign states.
The barristers body said it
also wanted Secretary for Justice
Rimsky Yuen Kwok-keung to
respond and that it was deeply
concerned the speech would be
interpreted as a rejection of the
principle in Hong Kong.
The [Bar Association] firmly
believes that the common law
principle of separation of
powers will continue to be implemented within the constitutional framework of the Basic
Law, it said in a statement.
Zhang has been accused of
provoking the public after a relatively calm period since the
Occupy protests ended. He said
that as the chief executive was not
just the top official in Hong Kong
but also answerable to Beijing,
the citys leader had a status
above the three branches.
The association said it would
be regrettable should this view
be taken as meaning that the
chief executive was superior to
the three institutions.
The chief executive, it argued,
cannot be said to be above the
law irrespective of the description of the political role.
The association called on
Zhang and Yuen to clarify the
position as soon as possible to
Rimsky Yuen said supervision of
chief executive is guaranteed.
rectify misconceptions and eliminate unnecessary doubts among
Hongkongers and the international community.
Yuen stressed earlier that the
Basic Law guaranteed judicial
and legislative supervision of the
Some media or interviewees
said [the chief executive] could
become a local king this is absolutely impossible, Yuen said.
He urged the public not to
read Zhangs words out of context, but he did not say whether
or not the separation of powers
was effective in the city.
Civic Party leader Alan Leong
Kah-kit called on Zhang to explain his remarks because comments from Yuen could at best
serve as second-guessing.
Zhang might just want to
provoke Hong Kong into reacting
more radically and violently
given anticipation of controversy
in his speech, Leong said.
Alan Hoo, chairman of the
Basic Law Institute and convenor
of the Liberal Partys constitutional affairs committee, said
Zhang had pointed out the reality
of the chief executives status.
The chief executive has a collective responsibility to account
to the central government for the
work of all three branches of government, Hoo said.
> MY TAKE A2
Tourists in Egypt
killed by mistake
Egyptian security forces killed 12
people and injured another 10
by accident, mistaking a
tourist convoy for militants they
were chasing in the countrys
Western Desert. At least two
Mexican tourists were among
the dead. > WORLD A8
CSFC strategy on stocks
questioned by analysts
Analysts have cast doubt on the
strategy used by China Securities
Finance Corp to shore up the
stock market, saying they are
baffled by the decision to invest
in small and medium-sized
firms. They cite high valuations
and the fact that prices have
since slumped. > BUSINESS B1
Tuen Mun woman leaps
to death with son, 10
Psychiatrists have raised
concerns about postnatal care
after a woman leapt to her death
with her 10-year-old son from
the 30th floor of a building in
Tuen Mun. The woman, 38, had
been receiving treatment for
postnatal depression since the
birth of her son. > CITY C1
Pair tackle big python
to rescue pet dog
A woman and her friend spent
30 minutes tackling a big,
strong python that attacked her
dog at Sai Kung Country Park.
[The rescue] seemed to go on
forever. It was exhausting but I
wasnt going to give up. Pippa
[the dog] is my baby. She is part
of the family, the woman, Stacy
Tucker, said. > CITY C2
of the government that he has led
have been formidable, he said.
Im very humbled by the
great honour and responsibility
that has been given to me today,
he said, adding that the government would see out the full term
and not seek an early election.
He also said his government
would be focused on ensuring
that in the years ahead as the
world becomes more and more
competitive and greater opportunities arise, we are able to take
advantage of that.
Julie Bishop will stay on as
deputy leader after defeating
Kevin Andrews by 70 votes to 30.
Yesterdays contest pitted a
man who has been described as
the most socially conservative
Australian prime minister in decades against a challenger some
think is not conservative enough.
Unlike Abbott, Turnbull sup-
ports gay marriage, wants Australia to replace the British monarch
with a president as head of state,
and backs a policy of making polluters pay for their carbon gas
Abbott and Turnbull are both
Rhodes scholars. Abbott, a 57year-old former Roman Catholic
seminarian, has long suffered an
image problem, particularly
among women. He is regarded as
Tony Abbott had survived a
February leadership challenge.
gaffe-prone and old-fashioned in
his views on womens place in
Turnbull is a self-made multimillionaire regarded by some as
arrogant and has been nicknamed The Silvertail, an
Australian term for wealth and
The government has trailed
the opposition in a range of opinion polls since April last year.
Abbott survived a leadership
challenge from within his party in
February that was prompted by
those polls and what some say
were questionable judgments he
At the time, Abbott asked his
colleagues to give him six months
to improve his governments
popularity. That deadline passed
without a change in polling. General elections are due around
September next year.
A2 Day by Day
TUESDAY, SEPTEMBER 15, 2015
LETS GET DIGITAL
WHO SAID IT?
Your best guide to top restaurants
There will probably be
more elbows thrown ...
Theres not enough hard
cash to go around ... to
keep 17 candidates alive
Real lives, real stories: watch them unfold at SCMP.tv
U.S. REPUBLICAN NATIONAL
COMMITTEE CHAIRMAN REINCE
PRIEBUS ON THE CROWDED FIELD
OF PARTY HOPEFULS FOR NEXT
YEARS PRESIDENTIAL ELECTION
> WORLD A9
An essential part of your Hong Kong Sunday routine
Nailing a problem. A new road is forced to bypass a lone house in Wuxi
Nail houses have become a big problem as mainland owners refuse to move because they say the
authorities have not offered them sufficient compensation. Planners therefore have to design roads
that skirt these structures. Photo: Imaginechina
The python was so
strong. Ive never seen
anything so big
Beijings latest edict born of frustration
CONNECT WITH US
Tencent Weibo: @
Sina Weibo: @SCMP_
or call 2680 8822
University students burned copies
of the Basic Law during the June 4
vigil. Protesters regularly target
mainland visitors. Soccer fans boo
the national anthem whenever its
played. Some self-styled nativists
openly profess Hong Kongs need
for full autonomy. A few pandemocratic lawmakers are forever
filibustering against the
government. The list goes on; no
wonder Beijing is worried.
The more Hong Kong resists,
the harder Beijing tightens the
screw. Its in this context that we
can make sense of Zhang
that the chief executive is above all
the branches of government and
that there is no Western-style
separation of powers.
It is the latest move by Beijing to
muscle in on the citys affairs and
show who the real boss is. As I
always like to quote an old
Cantonese adage, you provoke a
ghost, you get sick. You keep
poking your finger at Beijings
nose, even when its often
unwarranted and unnecessary,
this is what you get.
Some pan-democrats and their
allies claim they know this and
when they protest, they confine
their grievances to Hong Kongs
affairs. So their favourite tactic is to
undermine Leung Chun-ying and
The latest badmouthing was
when the Democrats led by Emily
Lau Wai-hing met Beijings
representatives and told them how
unpopular Leung was in Hong
Kong and how unsuitable he was
for the top job.
During last years Occupy
STACY TUCKER, WHO WITH A FRIEND,
BATTLED A THREE-METRE PYTHON
FOR HALF AN HOUR TO RESCUE HER
18KG PET DOG FROM THE SNAKE
protests, student leaders made the
absurd claim that Beijing was
misled by the Leung
administration and so produced its
inappropriately restrictive edict on
the citys electoral reform. Really,
did anyone think Beijing didnt
know what it was doing?
Pan-democrats and the liberal
media always accuse Beijing of
trying to polarise their camp by
meeting some of their members it
brands as moderate but not
Yet, from day one, they have
been trying to drive a wedge
between Beijing and Leung.
Beijing is fed up. By saying
Leung is effectively above the three
government branches and is
equally responsible to Hong Kong
and the central government,
Zhang is saying no one and no
organ of power can decide Leungs
fate other than Beijing.
> CITY C2
I try to be a perfectionist
but no one is perfect
BOXER FLOYD MAYWEATHER JNR,
WHO ANNOUNCED HIS
RETIREMENT WITH A PERFECT
49-0 CAREER RECORD
> SPORT C13
Leading the News
Back to Business
City / Sport
Letter of the Law
Going Out & Cinemas
Tuesday, September 15, 2015 A3
LEADING THE NEWS
sees Barry Cheung
spared prison term
Thai report comes
after Malaysia makes
three arrests related to
last months attack
Former Exco member who failed to pay staff at
collapsed exchange has jail sentence quashed
Reuters in Kuala Lumpur
A key suspect in the plotting of
last months deadly bombing in
Bangkok was last tracked via
multiple flights to Turkey, Thai
police said yesterday, as Malaysia
announced it had made three
arrests related to the attack that
killed 20 people.
Two Malaysians and a Pakistani national were arrested and
were assisting with the investigation, Malaysias police chief Khalid Abu Bakar said yesterday.
We believe the suspects can
help in the investigation, he
said. Our arrest was made to assist the Thai police in the Thai
bombing investigation. Malaysian and Thai police are working
closely in cooperation.
In Bangkok, Thai police chief
Somyot Poompanmoung said he
had not received any information
from Malaysian police on the
No group has claimed responsibility for the August 17
attack at the Erawan Shrine in
Bangkok that killed 20 people, including 14 foreign tourists,
among them seven from Hong
Kong and mainland China.
Thai police have said the man
who may have actually planted
the bomb may have fled across
Thailands southern border to
Malaysia, but Khalid refused to
speculate on that.
Protesters demonstrate against Prime Minister Shinzo Abes security bills aimed at expanding the remit of Japans armed forces. Photo: Kyodo
Tens of thousands rally in centre of Tokyo as Shinzo Abe seeks passage
this week of controversial security bills marking shift in defence policy
Agencies in Tokyo
Our arrest was
made to assist
the Thai police in
MALAYSIAS POLICE CHIEF
Thailand initially suggested
that those behind the blast may
have been from a gang involved
in smuggling Uygurs from Xinjiang
, while others speculated they may be separatists or
Islamist extremists angry that
Thailand repatriated more than
100 Uygurs to China in July.
Although the motive is unclear, Thai courts have issued arrest warrants for 11 people: one
Thai woman, four Turkish men,
one Chinese man and five foreign
men whose nationalities have
not been identified.
Two key suspects are also in
custody in Thailand, charged
with possession of illegal explosives. One of them was captured
from an apartment on the outskirts of Bangkok where police
also discovered bomb-making
material. The other was caught
near Thailands border with
Cambodia, and police said his
fingerprints were found on a container with explosive material
confiscated from the apartment.
In Malaysia, Khalid said the
Pakistani suspect was male, one
of the local suspects was female
and the other was male. He said
there were no plans to move the
suspects to Thailand yet.
Additional reporting by Associated
Press and Kyodo
> UYGUR LINK DOWNPLAYED A4
Tens of thousands of protesters
surrounded the Diet building in
Tokyo yesterday amid growing
public opposition to controversial national security bills that
Prime Minister Shinzo Abe aims
to have passed this week.
The mass rally in the centre of
Japans capital came after a similar one at the end of last month
that its organisers said attracted
about 120,000 people at the same
bills would greatly expand the
scope of the Self-Defence Forces
overseas activities, including allowing Japan to exercise the right
to collective self-defence, or
coming to the aid of its allies
under armed attack even if Japan
itself is not attacked.
Led by young people including members of Students Emergency Action for Liberal Democracy-s, or Sealds, leaders of opposition parties, including the Demo-
cratic Party of Japan and the
Japanese Communist Party, and
Noble laureate for literature Kenzaburo Oe were expected to take
part in the rally.
The bills are currently under
deliberation in the upper house
of parliament, after the ruling coalition, led by Abes Liberal
Democratic Party, pushed them
through the lower house in July.
If enacted, the new legislation
would mark a major shift in
Japans exclusively defence-oriented security policy.
Im not sure if my participa-
Respondents opposed to
the legislation in a poll
published yesterday by
tion would change something.
But I came here, for the first time,
as I feel [Abes] way to decide
without listening to peoples
voices is much too contemptuous, said 75-year-old Tateo Iida,
who lives in Chiba prefecture,
east of Tokyo.
I remember when I used to
come here almost every day for
demonstrations, Iida said, referring to mass rallies in the 1960s
when many university students
protested against the security
treaty with the United States.
Im worried that innocent
children, including mine, might
be involved in war. I came here to
get my strong opposition [to the
bills] heard, said a 33-year-old
woman who took part in the
More than half of voters in
Japan are opposed to their
governments plans to enact legislation that would allow Japanese troops to fight abroad for the
first time since the second world
war, a newspaper poll showed
A poll carried out over the
weekend and published yesterday by Asahi Shimbun showed 54
per cent of respondents opposed
the legislation against 29 per cent
who backed it, and 68 per cent
saw no need to enact the bills
during the current session.
Three-quarters of the respondents said the debate had been
Abes ruling bloc has a majority in the upper house, but opposition parties have vowed to use
all possible means to prevent a
Support for Abes government fell to 36 per cent, the survey showed, the lowest rate since
he took office in December 2012
and down from 38 per cent in last
months poll. Abes disapproval
rating inched up to 42 per cent
from 41 per cent.
Abe last week won a rare second consecutive term as a ruling
party chief, and hence premier,
pledging to retain focus on reviving the worlds third-largest
economy and deepen debate on
revising its pacifist constitution.
> U.S. AIR BASE BLOCKED A7
CONTINUED FROM A1
Chengdu beats Shanghai
in ranking of mainland
cities with best economy
a profit. Today there were
thought to be up to 800, most of
them in Guangdong and twothirds of them in the red, He said.
The government was partly to
blame for exaggerating, or misreading, demand, He added.
However, many companies
relied on government subsidies
and would collapse if these were
withdrawn, He said.
Cities in the province have
promised to deliver annual
has the most
successful economy of any mainland city, a US-based think tank
has concluded after looking at
such factors as job growth, foreign investment and high-valueadded industries.
Shanghai and Tianjin
came second and third respectively, while Beijing landed hard
in 13th place in the rankings by
the Milken Institute.
Chengdu, the capital of Sichuan
province, was singled
out for its human capital, central
government support, established
industries in high-end aerospace
and aircraft design, and a more
recently developed electronics
manufacturing sector, according to the institute.
The study pointed to two ways
cities were developing on the
mainland. In the case of Tianjin
and Shanghai, the institute saw
urbanisation, industrial clustering and infrastructure investment bolstering larger regional
But the recent slowdown in
economic growth suggests that
a new approach centring on
technology, private investment,
and consumption would replace the previous strategy.
The study is the first time the
institute has ranked mainland
cities. It assessed 266 at the prefecture level and above and divided them into two categories 34
first and second-tier cities, and
the rest as third-tier cities.
Instead of valuing projected
economic growth, the report
examined factors over different
time periods, including job and
wage growth, gross regional production, foreign direct investment and the strength of highvalue-added industries.
Chengdu, home of several
1 Chengdu, Sichuan
4 Dalian, Liaoning
5 Nanjing, Jiangsu
6 Hefei, Anhui
7 Xiamen, Fujian
8 Changchun, Jilin
10 Shenzhen, Guangdong
subsidies of between 200 million
yuan and 500 million yuan to
robot makers and to the manufacturers that install them on
But local operators claim
more is needed.
giants including Taiwans Foxconn Technology Group the
trading name of Hon Hai Precision Industry have set up their
own robotics businesses.
They have also started selling
robots to the domestic market,
squeezing the market share and
profits of smaller makers of factory and other robots.
Both He and Zeng agreed that
Chinese robot manufacturing
relied heavily on imported materials and technology, and the
robot boom in the delta in the
past year had not resulted in any
obvious technological upgrades.
The technology of domestic
sia and the United Arab Emirates
all former British colonies.
However, parents from 12
other countries and regions
including Singapore, Australia,
Taiwan and mainland China preferred to send their offspring to
the United States.
The survey researchers said
most parents in Hong Kong
believed that studying in an
English-speaking country guaranteed their child a well-paid job
and a brighter future than if they
had stayed in the city.
However, that is not always
the case. Hong Kong resident
Susan Kwan, 28, was sent to
Swansea University in Wales in
2008. Keen to study aerospace
engineering, she obtained a
bachelors degree in the subject
and a masters degree in
mechanical engineering in four
They thought that sending
me abroad to study a profession
such as aerospace engineering
was worth the investment, she
said of her parents.
Kwans parents spent 42,000
(HK$502,000) in tuition fees and
56,000 in living expenses.
But the cost did not yield the
returns expected. Kwan is not
working in aerospace engineering in Hong Kong. She is instead
in a junior position in which she
earns HK$18,000 a month.
How much extra parents would be prepared to pay, on average, to send
their child to an overseas university rather than a domestic one (%)
Ma Au ia
Hong Kong parents are second
only to their counterparts from
India for the money they spend
on their children for overseas
study. But there are doubts over
whether this is always money
A survey by HSBC of 5,500
parents in 16 countries and
regions found that three out of
four Hong Kong parents were
willing to send their children
abroad for tertiary education and
to spend 50 per cent more than
the cost of education at local
Hong Kong parents can
spend more than HK$1 million
on a child for an undergraduate
degree course in Britain.
According to the survey, Britain is a popular destination with
parents from Hong Kong, Malay-
Robot boom powers down into price warfare
robot makers is less mature than
that of overseas competitors. Our
advantage is that our robots are
cheaper though not of as high
quality as the imports, He said.
Deng Qiuwei, general manager of Shenzhen-based automation specialists Rapoo Robotics,
said: We rarely go to overseas robot expos. Domestic players like
to share information and experiences at exhibitions on the
Citys parents splash out on overseas study
Barry Cheung arriving in Admiralty yesterday. Photo: David Wong
A former Executive Council
member and chairman of the
now-defunct Hong Kong
Mercantile Exchange had his sixweek jail term for failing to pay an
employee quashed yesterday,
and was instead ordered to
perform 160 hours of community
Mrs Justice Judianna Barnes
Wai-ling ruled in favour of an
appeal lodged by Barry Cheung
Chun-yuen, 57, against his sentence, saying she believed
Cheung had demonstrated genuine remorse for his wrongdoing.
Sitting at the High Court,
Barnes said she found a magistrates decision to jail Cheung to
be incorrect, as the magistrate
had considered irrelevant factors in passing the sentence.
She found the magistrate
erred in taking into account the
fact Cheung could raise funds to
pay the exchanges rent and still
live in a Repulse Bay flat for which
monthly rent was HK$160,000.
The Kowloon City Court had
ruled in April that Cheung did not
make paying his employees a priority and that Cheung was not
genuinely remorseful, thus he
warranted a custodial sentence.
Barnes said Cheung, as chairman of the exchange, was not
personally liable to make payments to his employees, according to the law. He was only liable if
acourt had ordered him to be responsible for such payments.
Cheung admitted he failed to
pay Raymond Ma Shui-lung, a
senior corporate communications manager with the exchange, HK$340,000 for his services, of which HK$207,000 was
salary. Ma claimed Cheung failed
to pay for his services between
May and August 2013.
Ma filed a complaint with the
Labour Tribunal, and the tribunal ruled the company had owed
Ma the payment and that
Cheung, as chairman, failed to
After learning of the courts
decision yesterday, Ma said he
had no comment.
But he claimed he still had not
received the payment.
Ma claimed more than 100
staff of the exchange had not received their salaries since the
company collapsed in May 2013.
He said they received a small portion of their salaries from a government fund.
Cheung previously explained
to the lower court that an unnamed creditor stepped in to pay
rent for the exchange in October
2013. He said his wife and her
family paid the flats rent.
Cheungs lawyer, Peter Duncan SC, said his client tried all he
could to save the company. He
claimed Cheung wanted his staff
to have their salaries and jobs.
Duncan said Cheung was in
an unfortunate situation and
called him caring and passionate and not a heartless person.
Cheung was declared bankrupt in April with debts of HK$116
Alexa Chow Yee-ping, managing director of AMAC Human
Resources Consultants, reminded parents that investment in
tertiary education did not necessarily translate into premium
returns. It depends which university you went to and what subject you studied, she said.
Chow added that graduates
from established universities like
Oxford and Cambridge had advantages in the marketplace. But
graduates who studied business
administration or pure science in
less well-known universities
were viewed as no different to
other graduates given the surplus
of fresh graduates in Hong Kong.
Having a good command of
English would add a bit of an
advantage, she noted. But at
the same time, employers do not
offer higher salaries to overseas
graduates than to locals.
> WRONG PATH A11
Source: Milken Institute
respected universities, has
emerged as a key economic
growth engine in the mainlands
southwest, enjoying lower labour
Other cities that performed
well include Dalian
ranked ninth, stood along with
Chengdu as the only two inland
cities to make the top 10.
Shenzhen, which has evolved
from a low-cost manufacturing
base to the countrys information
technology hub, came in just
under the wire, taking the No 10
In the ranking of third-tier cities, Jiangsu was home to seven of
the top 10, with Suzhou taking the
A strong transport network,
including airports, highways and
high-speed rail lines connecting
cities throughout the Yangtze
River Delta played a crucial role
in the provinces economic
growth, the report said.
The institute released its
Best-Performing Cities China
2015 report in Beijing yesterday.
A4 Tuesday, September 15, 2015
Lieutenant General of the Thai
police (centre). Photo: Bloomberg
THAI POLICE HIT REVERSE ON
Pressure from Beijing may have prompted backflip on main theory about
who carried out last months bombing attack on Bangkoks Erawan Shrine
Agence France-Presse in Bangkok
The police investigation into the
Bangkok shrine blast increasingly points towards a gamechanging attack on Chinese tourists by Uygur militants or
sympathisers, analysts say but
Thailand and Beijing are loath to
Nearly a month after the August 17 attack, Thailand has two
foreigners in custody and a dozen
arrest warrants issued, and insists
the network responsible for the
explosion is in their crosshairs.
But investigators have yet to
provide a compelling motive for
the carnage in Bangkoks commercial heart, which left 20 people dead the majority ethnic
The leading theory they have
offered is that the bomb was an
act of revenge by criminals striking back at a police crackdown on
a people-smuggling network.
That take has been shredded
by analysts and the Thai public,
unconvinced a criminal gang
would have the means or motivation to carry out such a brutal act.
In recent days, links with militants from the Chinese Uygur minority or ethnic Turkic supporters seem to have firmed up with
the passports, ethnicities and
travel plans of key suspects all appearing to point in that direction.
If the police investigation is on
track, there is definitely a Uygur
or radical Turkish national connection, Zachary Abuza, an expert on Southeast Asian militant
Yet Thai police are bending
over backwards not to use the
words Uygur or terrorism,
largely, analysts say, for fear of
The latest suspect, Ishan.
Uygur or radical
ZACHARY ABUZA, ANALYST
In many ways
by its reliance
PAVIN CHACHAVALPONGPUN, ANALYST
putting off tourists or angering
China one of the juntas few
That determination reached
near comical proportions on
Saturday, when a warrant for a
key suspect named as Abudusataer Abudureheman, or Ishan,
Police said he was a Chinese
national of Uygur ethnicity who
left the country before the attack,
only to rescind the word Uygur
hours later and call on the press
to drop the term entirely.
Mostly Muslim Uygurs have
long accused Beijing of religious
and cultural repression in
Chinas far western Xinjiang
region, with hundreds of
refugees believed to have fled in
recent years, often heading to
Turkey via Southeast Asia.
Thailands deportation of 109
Uygur refugees to China in July
sparked violent protests in Turkey, where nationalist hardliners
see the minority as part of a global
Each release of information
from the Thai police has only
fuelled speculation of Uygur
One of the two suspects in
custody, Yusufu Mieraili, was arrested with a Chinese passport
that gave a Xinjiang birthplace.
Almost all the identified suspects have Turkish sounding
names or links, including the second detained foreigner Adem
Karadag who was discovered
with dozens of fake Turkish passports. Another suspect, Emrah
Davutoglu, had US$11,000 transferred into a Thai account to help
fund the operation, police say.
His Thai wife, also wanted
by police, says she currently lives
in the central Turkish city of
Kayseri, an area renowned for
giving sanctuary to Uygurs fleeing China.
If the culprits are Turkish or of
Turkic origin, said Anthony Davis, a security analyst with IHS
Janes, then it probably ties back
into the eruption of anger following the Thai decision to deport
Pictures showing the deportees hooded and surrounded by
Chinese guards, he added, could
have been the straw that broke
the camels back, raising the
prospect of a revenge attack
schemed in Turkey and carried
out with affiliates in Bangkoks
People killed in
last months attack
Analysts say Thailand is keen
to avoid naming Uygurs for
economic and diplomatic reasons. Chinese visitors are a linchpin of the tourist industry, and
Beijing remains one of the increasingly isolated Thai juntas
few international allies.
In many ways Thailand has
been handcuffed by its reliance
on Beijing, Thai politics expert
Pavin Chachavalpongpun, also a
former diplomat, said.
For its part, Beijing is keen to
avoid any suggestion its tourists
might now be considered targets
by violent Islamists because of
their governments domestic
Last week, Chinas state-run
Global Timesran a report quoting
an unnamed official admitting
Uygur militants could be behind
the blast. But the article was
Barry Sautman from the Hong
Kong University of Science and
Technology says China rarely
identifies militants as Uygurs in
order to keep a lid on ethnic tensions. Thailands reluctance is
an indication... that the Chinese
government is already involved
in this issue.
Michael Clarke, an authority
on Xinjiang at the Australian National University, said it was unclear if the blast may have been
carried out by a Uygur group or if
other jihadists opportunistically
used the Uygur issue as a cause
celebre in Thailand.
Other potential perpetrators
named by police or experts during the investigation have included international jihadists, members of Thailands southern Malay-Muslim insurgency or militants on both sides of the
countrys festering political divide. However, the design, target
and aftermath of the attack is not
considered to fit the modus operandi of any of these groups.
Uygur militant plots inside
China have been rudimentary
and they are not known to have
ever carried out an attack outside
For members of the global
Uygur community, Thailands
reluctance to officially point the
finger of blame has been little
The World Uygur Congress, a
lobby group, called for more
transparent information on the
attack from the Thai police.
I fear now that Uygurs currently in Thailand may be negatively impacted and hope the
Thai government will provide
humanitarian protection, said
spokesman Dilxat Raxit.
How suspicion for attack fell on repressed minority
against them. Scholars have argued that
Chinas stifling policies in the region
including restrictions on beards and veils
have marginalised the Uygurs and fuelled
militancy. Last year, Uygur economist Ilham
Tohti, who had urged Beijing to review its
policies and foster reconciliation, was
convicted of inciting separatism and
sentenced to life in prison. In response to the
2014 attacks, Beijing launched a one-year
crackdown on terror cells in Xinjiang,
executing and jailing hundreds of people on
Arrests made and details revealed about
the August 17 Bangkok bombing that
killed 20 people have raised the question
of whether members of an ethnic and
religious minority from Chinas far west
were involved. Heres a primer on the
Uygurs, the repression they face in China
and their presence abroad:
WHO ARE THE UYGURS?
The Uygurs (pronounced WEE-gurs) are
a Turkic-speaking Muslim ethnic group native
to Chinas far western region of Xinjiang
, which was sporadically controlled
by Chinese dynasties over the centuries.
They have long complained of ethnic
discrimination and religious restriction under
the Chinese government, which is dominated
by members of the Han ethnic group. Several
decades of economic development have
brought an influx of Han people into the
Uygurs oil-rich home region. Uygurs have felt
marginalised in the regions economic boom,
culminating in rioting that left nearly 200
dead in the regional capital of Urumqi
Since 2009, there have been frequent attacks
on police stations, military checkpoints and
government buildings in Xinjiang. The
violence has spilled into other regions with
Uygur militants accused of mounting attacks
Chinese Uygur Muslim men play chess
in the city of Urumqi. Photo: AFP
in train stations, markets and even
a public square in Beijing. In March 2014,
a group of Uygurs including two women
slashed indiscriminately at crowds at a train
, killing 31. In May of
station in Kunming
2014, a bomb assault on a market in Urumqi
left 43 people dead.
Beijing has long been wary of the
independence-minded militants and began
labelling them terrorists in 2001 in a bid to
win international support for the struggle
Uygurs have been fleeing China in recent
years, often by way of Southeast Asia. Rights
advocates say they are escaping repressive
rule, but Beijing says many are leaving to join
jihad with the intention of returning to China
to carry out terrorist attacks. Courts in the
Xinjiang cities of Hotan
Chinese smugglers who helped Uygurs cross
illegally into Vietnam, as well as several
Uygurs who unsuccessfully tried to emigrate
illegally. While there are large Uygur
diasporas in Europe and the United States,
Turkey is the destination of choice for most
seeking to leave China. Turkeys government
is under intense public pressure to support
the Uygurs, leading to tensions in Ankaras
relationship with Beijing.
In late 2014, the Thai government detained
hundreds of migrants believed to be Uygurs
in refugee camps, including women and
children. Many refused to speak to Chinese
officials, claiming to be Turkish, and many
obtained legitimate Turkish passports and
later settled in Turkey. However, on July 9
of this year, Thailand repatriated more
than 100 of the Uygurs mostly men who
were wanted by China as terror suspects.
This drew criticism from Uygur advocates,
human rights groups, the US, the United
Nations and others, all concerned that the
returnees would be persecuted. Video
footage by Chinese state media showed
the men hooded and under tight security.
Chinese authorities have granted no
independent access to any court proceedings
for the returnees.
After the attack in Bangkok, police arrested
two foreigners, confiscated bomb-making
materials from two flats on the outskirts
of Bangkok and are looking for 10 other
suspects. The first suspect arrested was
found at one of the flats and possessed
a fake Turkish passport. The second, arrested
near the Thai-Cambodia border, carried
a passport that indicated he was originally
Above: A Thai Army officer collects evidence following the attack;
below: a joint military and police operation turned up bomb-making
materials at a residential building. Photos: Bloomberg, AP, EPA
Tuesday, September 15, 2015 A5
Whats important is not
how big it is, but how good
DIANRONG CHIEF EXECUTIVE SOUL HTITE, ON
CHINAS P2P MARKET > CHINA A6
China think tank to
host N Korea forum
A think tank backed by the
Chinese government will host a
forum with officials from six
countries involved in stalled
talks on North Koreas banned
nuclear weapons programme,
the foreign ministry said
yesterday, in Chinas latest push
to resume discussions.
Academics and experts from
China, the United States, Russia,
South Korea, Japan and North
Korea will attend the Beijing
event, hosted by the China
Institute of International
Studies, on Friday and Saturday.
Repairs begin on
Tianjin rail station
Workers have started to rebuild a
train station in Tianjin
was seriously damaged in the
powerful twin explosions that
shook the port city last month.
The station was located about
650 metres from the blast site.
The rail line, which links central
Tianjin and the Binhai New
Area, suspended operations
after the accident, Xinhua
reported. Staff Reporter
Trilateral talks on
Japan, China and South Korea
plan to discuss how to
strengthen their cooperation
over African affairs at a meeting
in Beijing today, diplomatic
sources said. The talks will focus
on increasing mutual
developing Africas resources
and infrastructure. Kyodo
Key pollutant falls 17pc
in 161 cities this year
PM2.5 levels in 161 mainland
cities had fallen by an average of
17 per cent since the start of the
year, the deputy minister of the
environment said. Wu Xiaoqing
said the decrease was
due to the adoption of a tougher
emissions standard introduced
in 2012, and which was due to be
rolled out nationally next year.
Get the latest stories today
For breaking news and updates on
China, go to scmp.com/news/china
BEIJING TAKES SOFTER
LINE ON S.O.E. OVERHAUL
Failed reform experiments force more conservative approach to letting
private capital play a role in state-owned enterprises, analysts say
The State Council has changed
tack with its plans to overhaul
state-owned enterprises, taking a
more conservative line in Sundays blueprint on introducing
private capital than it touted two
Analysts say that shift is the result of unsuccessful reform experiments hindered by reluctant
The document released on
the weekend called for fostering
through private investment to rejuvenate inefficient state firms.
It said changes in capital
structure would be pursued
gradually but did not set any
The wording of the statement
was a step back from the call at
the Communist Partys plenum
in late 2013, which stressed the
need to foster a mixed-capital
structure in the firms in a proactive way, a term that was later
toned down to in an orderly
fashion in the annual government work report in March.
A lead researcher at a private
think tank said the backtrack followed a series of unsuccessful attempts to overhaul SOEs.
State firms are still very cautious about ownership and they
dont feel they should involve private companies, the researcher
Private companies that took
part in the experiment were also
The State-owned Assets
Supervision and Administration
Commission announced in July
last year that two SOEs would experiment with mixed-capital
By August this year, 22 prov-
up to 1tr yuan in
Lower-level governments reluctant to spend
allocated money amid anti-graft campaign
Reuters in Beijing
Angry mainland authorities have
seized up to 1 trillion yuan
(HK$1.21 trillion) from local governments who failed to spend
their budget allocations, sources
said, as Beijing seeks ways to
stimulate economic growth
which is at its slowest for 25 years.
1 trillion yuan equals this
much of projected total
The huge underspend, linked
to officials reluctance to spend
on big-ticket projects while authorities crack down on corruption,
supports the argument of some
economists that state investment
has grown too slowly this year.
In the past, local governments had asked for the money.
Money was given, but no one
acted, said one of two sources,
both of whom are close to the
They declined to be named as
Eyes in the sky
they are not authorised to speak
to the media.
Investments were not realised, and the money will be reallocated, added the source, an
economist. He did not elaborate
on how the funds would be spent.
The repossessed money
would pay for other investments,
said the sources, as economic
growth looks increasingly likely
to fall below 7 per cent. Lacklustre
spending growth could be especially punishing for China, as investment is seen by some government economists as the best way
to shore up activity in the short
One trillion yuan of unspent
funds is equivalent to about 6 per
cent of the mainlands projected
total government spending for
the year. The Finance Ministry
was not immediately available
As part of reforms proposed
by Beijing at the end of 2013,
China is pursuing its boldest antigraft campaign yet that has felled
a powerful former domestic security chief among others.
While the campaign has been
a hit with the public, it has also
had the unintended consequence of scuppering investment as fearful officials eager to
stay out of trouble resort to early
retirement or dither over approving major projects.
That has annoyed Beijing,
which has repeatedly threatened
to punish procrastinating governments by recalling their unspent budgets. HSBC estimated
in May that China had 3.8 trillion
yuan of unused fiscal funds carried over from previous years.
On Saturday, the Economic
Observer newspaper reported
there was about 100 billion yuan
of unspent capital, citing audit reports over the past three months.
inces had announced similar
plans at the local level.
But most of those efforts did
not succeed, the researcher said.
The root of the problem was
the overemphasis on the security
of state assets They worried
about the potential loss of state
assets even if the stocks rose after
Zhang Chunxiao, a researcher
at Beijings Chinese Academy of
Governance, said the painful lessons of the SOE reforms in the
1990s also hung over the reforms,
raising fears that assets could be
siphoned off through corruption.
Some officials, out of their own
interest sold national assets at
low prices even giving them
away for free causing great losses [in the 1990s], China Business
News quoted Zhang as saying.
Sheng Hong, director of Beijing-based think tank Unirule Institute of Economics, said the
plan announced on Sunday
stopped short of introducing
competition, which was supposedly the most important part of
We can tell that vested interest groups are unwilling to reform and they are too strong,
Strengthening the partys role
in the firms was not the solution
either, because most SOE offi-
cials who turned out to be corrupt and incompetent were appointed by the party, Sheng
BNY Mellon strategist Simon
Cox said the progress of economic reforms pledged by Beijing in 2013 had so far fallen short
of peoples hopes.
Those reforms might have lost
their shine in the eyes of the
leadership as it tried to tighten its
iron grip on power through campaigns like the ongoing graft
clampdown, he said.
Xis focus on reforms seems
less than laser-like, Cox said.
Maybe once party-building
efforts reached the level of his
satisfaction, he will return to
reforms towards the end of the
Additional reporting by Celine Ge
A Long March 2D carrier rocket carrying the Gaofen-9 highdefinition earth observation satellite blasts off from the Jiuquan
Satellite Launch Centre in Jiuquan
yesterday. It will be used for land surveys, city planning, crop
yield estimates and disaster prevention. Photo: Xinhua
A6 Tuesday, September 15, 2015
Workers lay down a glass
floor on a bridge spanning a
chasm in the Shiniuzhai
National Geopark in Hunan
province. Visitors will
get a stomach-lurching
thrill as they cross the 300
metre-long bridge with
clear views down to the
ground 180 metres below.
authorities added a small
section of glass last year
(bottom right), and decided
to transform the entire
length of the crossing. The
floor is made of a double
layer of glass, and is 24mm
thick in total.
Photo: China News Service
ONLINE LENDING FIRM THINKS
SMALL BUT HAS BIG AMBITIONS
Peer-to-peer loan business Dianrong aims to reach out to clients that the banking majors overlook
Soul Htite, co-founder of the
Lending Club, the worlds largest
online loan broker, has a vision:
to shake Chinas regular banking
sector out of its complacency.
Aware the nations shadow
banking system loans provided
outside the normal banking sector charges criminal annualised interest rates of more than 40
per cent, he said its my job to
help traditional banks go digital
to serve a larger base of mainland
clients, particularly small businesses and individuals.
Htite, 43, left Lending Club in
2010 and founded Chinese online
peer-to-peer (P2P) lending platform Dianrong.com with lawyer
Guo Yuhang in 2012.
Chinas P2P market is already big, Htite, Dianrongs
chief executive, said. But whats
important is not how big it is, but
Dianrong is one of about
2,000 mainland P2P firms offering loans to internet clients.
P2P is not just a platform, its
a technology, he said referring to
peer-to-peer computer systems that communicate with
each other without passing
through a central server.
We are still building infrastructure, not only for ourselves,
but for Chinese banks. You cant
have 2,000 P2Ps in China.
The P2P sector, benefitting
from a fast-growing population
of internet users and Beijings
efforts to overhaul the banking
system, has grown rapidly since
Mainland banks used to focus
on large, powerful corporate clients and shun small firms and individuals. But the countrys
leadership, hoping to bolster
start-ups and cultivate entrepreneurship, is directing a marketoriented banking system that
could offer individuals and small
firms wider access to financing.
Small mainland players looking to fund expansion must
resort to the shadow banking system or black market with interest
rates topping 40 per cent a year.
Htite said commercial banks
closed their doors to 90 per cent
of mainlanders seeking loans.
My job is to help
banks go digital
to serve small
SOUL HTITE, DIANRONG.COM
We want Dianrong to look at
them, said Htite who hopes
Dianrong will handle six times its
present volume next year.
Last month, Standard Chartered Bank became a Dianrong
shareholder, investing US$207
million in a new round of finance.
Global consultancy McKinsey
said more than 70 per cent of
mainlanders would try a digital
bank and warned of many loan
defaults in the P2P sector due to
lack of proper risk management.
Beijing issued a guideline on
internet finance businesses in
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