Featured Article

The Long Term Risks of China's Inflation Problem

By Pieter Bottelier

04/28/2008 - China’s tolerance of inflation has a low threshold because of the risks it poses to social and political stability. That is why the government and the people have been worried about a steep rise in the consumer price index (CPI) since the first half of 2007. Is this the beginning of a new and potentially dangerous inflation cycle? Earlier cycles were often associated with severe social hardship and political turmoil. The Tiananmen disaster on June 4, 1989, might have been prevented if the high inflation of those days had not brought so many additional demonstrators to the Square frightening the leadership. Older political leaders remember that the Communists’ defeat of the Nationalists in the Chinese civil war of 1945-1949 was greatly assisted by the run-away inflation of those years, which sharply reduced the popularity of Chiang Kai-shek’s Republic of China (ROC) government.

Land Disputes Ignite Peasant Uprisings in Rural China

By Russell Hsiao

04/28/2008 - An altercation between police and villagers in Saixi—protesting against insufficient compensation for the appropriation of land in the village for mining—resulted in bloodshed that left two reported dead, more than 20 injured and five critically wounded, according to a report by Hong Kong newspaper Ming Pao on April 22 (Ming Pao, April 22). The incident took place on April 21 in the village of Saixi, near the city of Mengdong, in the autonomous prefecture of Malipo on the border of Vietnam, where the population is majority Miao, an ethnic minority group in China. Allegedly, on April 20, miners from Zijin Mining Corp., one of the largest mining companies in China, began excavations on the contested village land. A group of around 100 villagers gathered on April 21 to protest the insufficient compensation package offered by the company. According to a source cited by Ming Pao, when the local police arrived at the scene to put down the protest, tensions escalated after the villagers started to use wooden sticks and bricks to attack the police, which left five police officers wounded (China Times, April 22). The police reportedly then fired warning shots to disburse the protests but to no avail; it was then that the police fired into the crowd, reportedly killing two villagers (China Times, April 22). An official from the Malipo County government’s propaganda department by the surname Xie said that it was only when the officers’ lives were believed to be under threat that they used their guns in self-defense (China Times, April 22). Local officials claim that the villagers were from small mining companies without licenses. Moreover, the official stated that only one villager was killed and 11 were wounded in the violent standoff, and no bodies were found on the scene of the incident (Xinhua News Agency, April 22).