China fourth-quarter growth weakest since 2009 as policy misstep fears grow

Markets | Tue Jan 19, 2016 2:37am EST Related: CHINA

BEIJING | BY KEVIN YAO AND XIAOYI SHAO

China's economic growth in the fourth quarter slowed to the weakest since the financial crisis, adding pressure on a government that is struggling to restore the confidence of investors after perceived policy missteps jolted global markets.

Concerns about China's policy making ability have shot to

the top of global investors' risk lists for 2016 after a renewed plunge in its stock markets and yuan currency CNY=CFXS stoked worries that the economy may be rapidly deteriorating.

Xi’s new model army

Xi Jinping reforms China’s armed forces—to his own advantage

Jan 16th 2016 | BEIJING

The Economist

CHINA’S biggest military shake-up in a generation began with a deliberate echo of Mao Zedong. Late in 2014 President Xi Jinping went to Gutian, a small town in the south where, 85 years before, Mao had first laid down the doctrine that the People’s Liberation Army (PLA) is the armed force not of the government or the country but of the Communist Party. Mr Xi stressed the same law to the assembled brass: the PLA is still the party’s army; it must uphold its “revolutionary traditions” and maintain absolute loyalty to its political masters. His words were a prelude to sweeping reforms in the PLA that have unfolded in the past month, touching almost every military institution.

Opposition leader’s landslide win in Taiwan puts onus on China to respond

The Washington Post

By Simon Denyer January 17 at 2:44 PM 

TAIPEI, TAIWAN — A stunning victory for Taiwan’s opposition and the election of the island’s first female president Saturday signal a new era and send a clear message: Taiwan is coming of age as a democracy.

The question is whether Beijing is listening, and how it will respond.

Even as the final votes were being tallied, President-elect Tsai Ing-wen was reaching out to China and calming any fears the giant neighbor might have.

Tsai’s Democratic Progressive Party considers Taiwan to be a sovereign, independent nation, but it sees no need to anger Beijing by making a formal declaration of independence. But Tsai went further, promising in her victory speech that she would rise above party politics, maintain peaceful and predictable relations with Beijing, and avoid doing anything provocative.

Greece Seeks German Know-How to Tackle Tax Evasion

By THE ASSOCIATED PRESS ATHENS, Greece — Jan 16, 2016, 4:04 PM ET

Greece has turned to a German state government to seek help in combating tax evasion.

Greek tax officials, initially numbering about 50, will be trained by the tax authorities of North Rhine-Westphalia, a state noted for its success in persuading German citizens to repatriate capital they had whisked abroad to avoid taxation. Their efforts have resulted in 1 billion euros ($1.09 billion) in extra revenue since 2010.

Next Up for Greece: How to Shrink the Debt

Political talks to begin after first bailout review is done

The Wall Street Journal

By VIKTORIA DENDRINOU

Jan. 14, 2016 1:44 p.m. ET

Greece’s creditors are expected to start talking soon over an issue that has been looming over the eurozone since 2010: cutting the country’s mountainous debt burden.

Greece already sliced its debts to private lenders through a bond swap in 2012. But that wasn’t enough. Now, most of its debt is owed to other eurozone governments, which have conceded Athens needs more relief.

After Nuclear Test, South Korea Urges China to Rein In North

The New York Times

By CHOE SANG-HUNJAN. 13, 2016

SEOUL, South Korea — A week after North Korea conducted its fourth nuclear test, President Park Geun-hye of South Korea urged China on Wednesday to do more to rein in the North, amid growing criticism that Ms. Park’s policy of building stronger ties with Beijing was not showing results.

“China has repeatedly said publicly that it would not tolerate North Korea’s nuclear weapons,” Ms. Park said in a nationally televised speech. “I think China is fully aware that if such strong will is not matched by necessary measures, we cannot prevent fifth and sixth nuclear tests by the North or guarantee real peace and stability on the Korean Peninsula.”

As Taiwan’s Workers Flock to China, Concerns About Economy Grow

By AUSTIN RAMZYJAN. 13, 2016

The New York Times

TAIPEI, Taiwan — Jason Lee spent most of the last decade building a business in a field for which Taiwan is famous. With three friends, he founded an animation studio here, churning out TV shows and special effects for games and films.

But costs rose and orders dried up, and they closed up shop in 2011. A few years later, Mr. Lee left Taiwan for mainland China, where he was hired to run an animation studio in the city of Qingdao. Five months ago, he started his own studio there. He has 20 employees, a number he hopes to double after the Chinese New Year next month — growth he could not have imagined in Taiwan.

Greece Renews Challenge to Creditors’ Austerity Policies

Labor Minister says stimulating growth, not belt-tightening, is best way to bolster country’s finances

The Wall Street Journal

By NEKTARIA STAMOULI and  MARCUS WALKER

Jan. 12, 2016 4:41 a.m. ET

ATHENS—Greece’s left-led government renewed its challenge to its creditors’ austerity policies on Tuesday, vowing to resist further pension cuts while calling on Europe to let Greece meet budget targets mainly via economic growth, not belt-tightening.

“The best way to fill this gap [in Greece’s budget] isn't by reducing, but by increasing the economy,” Labor Minister George Katrougalos said in an interview with The Wall Street Journal.

U.S. may send more strategic weapons to Korean peninsula: South Korea

Mon Jan 11, 2016 4:51am EST Related: WORLD, SOUTH KOREA

SEOUL | BY JU-MIN PARK AND JEE HEUN KAHNG

Reuters

The United States and its ally South Korea were discussing on Monday sending more strategic U.S. weapons to the Korean peninsula, a day after a U.S. B-52 bomber flew over South Korea in response to North Korea's nuclear test last week.

North Korea said it set off a hydrogen bomb last Wednesday, its fourth nuclear test since 2006, angering China, the North's main ally, and the United States, which said it doubted the device was a hydrogen bomb.

France 'convinced Greece will live up to economic reform promises'

Sun Jan 10, 2016 4:52pm EST

PARIS

Reuters

Greece found an ally in France's finance minister on Sunday as Athens seeks support from its European creditors for its efforts at economic reforms that are crucial to opening talks on easing its debt burden.

Speaking after meeting in Paris with his Greek counterpart, who is on a tour of euro zone capitals, French Finance Minister Michel Sapin said he was won over and that France was in favor of moving on to tackling the debt issue quickly.

Putin: US and NATO want to 'sit on the throne in Europe alone'

Deutsche Welle

11-1-2015

Russian President Vladimir Putin has defended his policies in Ukraine and Crimea and slammed NATO expansion and the United States. He also said he trusts German Chancellor Angela Merkel.

Russian President Vladimir Putin slammed western sanctions against his country as "geo-political" rather than aimed at solving the crisis in Ukraine and criticized NATO expansion and the United States for trying to impose its will, in a wide-ranging interview published Monday in the popular German daily newspaper "Bild."

Greece's conservatives choose reformer to lead

11-1-2015

Deutsche Welle

The conservative New Democracy party has voted in no-nonsense reformer Kyriakos Mitsotakis as its new leader. The Harvard-educated economist is expected to challenge Greece's charismatic Prime Minister Alexis Tsipras.

The party announced Mitsotakis' victory after 70 percent of the nationwide vote was counted, with the new leader claiming 51 percent of the vote to former parliament chief Vangelis Meimarakis' 49 percent.

Kyriakos Mitsotakis Elected to Lead Greece’s Conservatives

New Democracy voters choose former administrative reforms minister over rival Vagelis Meimarakis

By STELIOS BOURAS

Updated Jan. 10, 2016 6:44 p.m. ET

1 COMMENTS

ATHENS—Greece’s main opposition party, center-right New Democracy, elected Kyriakos Mitsotakis as its new leader, a party spokesman said, making the 47-year-old former minister the main challenger to Greek Prime Minister Alexis Tsipras.

Mr. Mitsotakis, the American-educated scion of one of Greece’s most prominent political dynasties, is an advocate of market-oriented economic overhauls, including slimming down Greece’s often-inefficient state. His surprise victory in Sunday’s party leadership ballot provides a boost to the cause of economic reforms of the kind demanded by Greece’s creditors, whose bailout loans have been keeping Greece from bankruptcy since 2010.

A New Economic Era for China Goes Off the Rails

By KEITH BRADSHERJAN. 7, 2016

The New York Times

HONG KONG — When President Xi Jinping of China convened a group of top officials to discuss the economy last month, the highly publicized meeting was seen as a moment of triumph.

A stock market plunge last summer, and a messy currency devaluation that followed, had faded from global view. In the relative calm, he seemed to usher in a new era of economic management, promising policy coordination at the highest levels to prevent another bout of turmoil.

Less than three weeks later, his plans have been derailed as China’s stock market and currency once again rattle investors around the world. The latest rout sets up a challenge for Mr. Xi, who has positioned himself as the master of the country’s economy.

Police Report of Cologne New Year’s Eve Details Chaos, Overwhelmed Force

Angela Merkel signals willingness to toughen deportation procedures

The Wall Street Journal

By RUTH BENDER

Updated Jan. 7, 2016 4:18 p.m. ET

142 COMMENTS

A detailed account of the mass assaults in Germany’s fourth-largest city on New Year’s Eve emerged Thursday, drawing a picture of chaos and aggression that left police overstretched and attackers enjoying virtual free rein.

An internal federal police report dated Jan. 4 and seen by The Wall Street Journal described scenes in Cologne of crying women fleeing sexual molestation from crowds of men, passersby trying to rescue young girls from being raped, and groups of intoxicated men throwing bottles and fireworks at a police force no longer in control of the situation.

Greece’s Glimmer of New Year Hope

The potential election of Kyriakos Mitsotakis as head of Greece’s main opposition party would be a watershed moment, Simon Nixon writes

The Wall Street Journal

By SIMON NIXON

Jan. 6, 2016 3:35 p.m. ET

It is easy to list what might go wrong in Europe in 2016: a global economic slowdown that rekindles fears over eurozone debt sustainability; a worsening refugee crisis that leads to the collapse of the Schengen passport-free travel zone; increased political instability as a result of rising support for populist parties; plus the possibility that the U.K. might vote to exit the EU in a referendum likely later this year, which would trigger a political earthquake that would destabilize the entire continent.

Be Scared of China's Debt, Not Its Stocks

107 JAN 7, 2016 5:34 PM EST

By Noah Smith

Bloomberg

China’s stock market is crashing again. After two days this week with big and rapid declines -- the latest of which shut off trading only a few minutes after the open -- Chinese stocks are back in the neighborhood of their mid-2015 lows. The raft of administrative measures that the Chinese government has used to prop up its markets since the big plunge last year seems to only have postponed further declines, rather than prevented them.

Greece Deserves a Break on Pension Reform

25 JAN 7, 2016 4:38 AM EST

By Mark Gilbert

Bloomberg

After teetering on the brink of exiting the euro for much of last year, Greece has started 2016 looking much more likely to hang on to its common-currency membership card. Now, after clearing several reform hurdles set by its creditors, the nation deserves some leeway on the thorny issue of pension reform.

How ISIS runs its economy

By Financial Times

From the site of the World Economic Forum

Dec 16 2015

This article is published in collaboration with The Financial Times.

Even under jihadi rule, death and taxes remain the two great certainties of life. Some learn that the hard way.

As Isis officials announced a religious tithe known as zakat last summer, Mansour, a 26-year-old grocery storekeeper in eastern Syria, stalled payment while he tried to cook his books.

EU enters brave new world of bank bail­ins

By Hugo Dixon

January 4, 2016

Reuters

The author is a Reuters Breakingviews guest columnist. The opinions expressed are his own.

The European Union entered a brave new world of bank “bail­ins” at the start of 2016. Europe has wasted so much taxpayers’ money on bailing out bust banks in recent years that it is right to try to get investors to help foot the bills in future. However, the tough new regime carries big political risks. The key new rule is that no bank can be bailed out with public money until creditors accounting for at least 8 percent of the lender’s liabilities have stumped up. So­called bail­ins typically mean wiping out creditors’ investments, slashing their value or converting them into shares in the bank. Uninsured depositors could get caught along with professional investors.