A table-tennis match on Jan. 7 in Beijing marked the 30-year anniversary of the establishment of normalized diplomatic relations between China and the United States on Jan. 1, 1979. U.S. Deputy Secretary of State John Negroponte, center left, and China's Vice Foreign Minister Wang Guangya, center right, attended.

In April 1971, China invited the U.S. table-tennis team to visit in what Time magazine called "the ping heard round the world." One of the Americans was then 15-year-old Judy Bochenski Hoarfrost, right, who returned today to play veteran Chinese player Qi Baoxiang, left. The 1971 visit launched an era of "Ping-Pong diplomacy," and according to Time, "Probably never before in history has a sport been used so effectively as a tool of international diplomacy." Obviously, with the 2008 Beijing Olympics, it hasn't been the only time China has used sports to try to improve its image.

See also:

• Chinese President Hu Jintao dominates at the Ping-Pong table.
• The FP photo essay, "China's 30 Years of Economic Overdrive," marks the reforms set in motion by Deng Xiaopeng.

Photo: Andy Wong-pool/Getty Images

It isn't every day that Somalia beats China in a battle of military technology... and still loses.

On Tuesday, it was the well-armed, satellite-phone-wielding Somali pirates who held up a Chinese cargo ship. The crew members' defense? Petrol bombs! The makeshift Molotov cocktails worked well enough to hold off the pirates until an international patrol helicopter intervened.

No wonder China is dispatching ships to join the international contingent of navies patrolling against piracy in the gulf of Aden. 1,265 Chinese ships have passed through that same corridor this year and 20 percent of those came under attack. Not good odds.

Alas, should we just start shipping our Suez-bound goods over land? I'll let you see a lay of the land and decide for yourself: the president has fired the prime minister. Parliament is impeaching the president. The U.S. wants to send peacekeepers, but U.N. diplomats fear that's suicide. The entire country is food insecure, and about half is a humanitarian emergency.

No wonder the pirates prefer the seas. 

Swedish prosecutors are investigating whether Nobel Prize jurors who accepted an all-expenses paid trip to China can be charged with accepting bribery. Jurors from the medicine, physics, and chemistry comittees all accepted invitations from the Chinese government to come speak about what it takes to win a Nobel Prize. Chinese authorities covered their plane tickets, hotels, and meals.

One member of the Swedish Royal Academy of Sciences admitted that this doesn't look very good for the prize:

"We should be very careful not to put ourselves in a situation where the Nobel committee's work can be called into question," he said. "I think we should have thought about that here."

On the other hand, if China was trying to influence their decision, they may need to work a little harder. China hasn't won a prize since 1957.

(Hat tip: China Digital Times)

This month marks the 30-year anniversary of economic reforms launched by late Chinese leader Deng Xiaoping that have turned China today into one of the most powerful countries in the world. In late 1991, the New York Times reported that Deng told China's Economic Daily:

In the end, convincing those who do not believe in socialism will depend on our nation's development. If we can reach a comfortable standard of living by the end of this century [the 20th], then that will wake them up a bit. And in the next century [the 21th], when we as a socialist country join the middle ranks of the developed nations, that will help to convince them. Most of these people will genuinely see that they were mistaken.

Fast-forward to 2008: China has been doing astoundingly well, but people in developed countries aren't exactly admitting to being mistaken about socialism. Rather, "communist" China has learned how to play the capitalist game -- well.

To see a timeline of China's economic advances during the past three decades, check out FP's latest photo essay, "China's 30 Years of Economic Overdrive."

AFP/Getty Images, China Photos/Getty Images

The editors at MaxPlanckForschung, flagship journal of Germany's Max Planck Institute, got a little more than they bargained for with an example of "classical" Chinese calligraphy they used on the cover of their latest issue. The idea was to evoke an image of China, which was the focus of the issue. But instead of arousing interest in cutting-edge science, Chinese readers discovered the calligraphy was titillating in other ways. A translation:

With high salaries, we have cordially invited for an extended series of matinées

KK and Jiamei as directors, who will personally lead jade-like girls in the spring of youth,

Beauties from the north who have a distinguished air of elegance and allure,

Young housewives having figures that will turn you on;

Their enchanting and coquettish performance will begin within the next few days.

Despite having consulted a "German sinologist" about the text, no one seems to have caught the two glaring letter K's - I would think a dead give-away things aren't so "classical," even if you fail to comprehend the other characters. Maybe that's just in hindsight, though.

If only the content in science journals was so exciting.

As Jerome reported in yesterday's This Week in China, the Chinese government criticized French President Nicolas Sarkozy for hurting "the feelings of the Chinese people" by meeting with the Dalai Lama. This is a favorite phrase of Chinese officialdom, as James Fallows notes.

One Chinese blogger took it upon himself to comb through the People's Daily archives to rank the countries and organizations that have hurt Chinese feelings the most. The superb China media blog Danwei.org shares the results:

1. Japan: 47 times, starting in 1985
2. USA: 23 times, starting in 1980, when Los Angeles flew the ROC flag
3. NATO: 10 times, mostly relating to the 1999 Belgrade embassy bombing
4. India: 7 times, starting in 1986 and mostly relating to border issues
5. France: 5 times, starting in 1989
6. Nobel Committee: 4 times
7. Germany: 3 times, starting with a meeting with the D?l?i L?m? in 1990
8. Vatican City: 3 times, starting in 2000
9. EU: 2 times, starting in 1996
10. Guatemala: 2 times, both in 1997
11. Indonesia: in 1959, when a newspaper inflamed anti-Chinese sentiment
12. Albania: in 1978, for criticism of Chairman Mao and the Chinese Communist Party
13. Vietnam: in 1979, for a high official's slander of China
14. UK: in 1994, over the Taiwan issue
15. The Netherlands: in 1980, over the government authorizing a company to provide submarines to Taiwan
16. Iceland: in 1997, for allowing Lien Chan to visit
17. Jordan: in 1998, for allowing Lien Chan to visit
18. Nicaragua: in 1995, for supporting Taiwan's bid to join the UN
19. South Africa: in 1996, for proposing a two-China policy

In case that wasn't clear enough, there's a map of countries that have offended China:

Have you ever hurt China's feelings?

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The Chinese government strongly rebuked French President Nicolas Sarkozy for meeting with the Dalai Lama at a conference of Nobel Laureates in Poland over the weekend. Sarkozy's actions “severely undermined China’s core interest, gravely hurt the feelings of the Chinese people and sabotaged the political basis of China-France and China-EU relations,” said Deputy Foreign Minister Ha Yafei in a statement.

 

An editorial in the People's Daily, the Communist Party's mouthpiece publication, accused Sarkozy of drumming up controvery to draw attention away from his political woes at home. Meanwhile, internet users have called for protests of French goods and stores, such as Carrefour markets, recalling similar protests earlier this year after activists disrupted the Olympic torch relay in Paris.

U.K. Prime Minister Gordan Brown and German Chancellor Angela Merkel have also recently met with the Dalai Lama but without much consequence. Given that France currently holds the E.U. presidency, China is probably concerned at the visibility of French actions. Sarkozy will have to be careful where he sticks his neck out.

General News

Officials say upcoming reforms to China's fuel taxation and pricing schemes will lower gasoline prices, which have remained high despite plunging oil prices.

China has banned pork imports from Ireland due to dioxin concerns.

Direct flights between mainland China and Taiwan will begin Monday with a flight from Shanghai operated by China Eastern Airlines.

Politics

In China, arrests marked the 60th anniversary of the Universal Declaration of Human Rights. One well-known dissident, Liu Xiaobo, was detained for his involvement in drafting a public letter that demanded political reform and was signed by over 300 academics, lawyers, artists, and farmers.

Japan lodged a complaint with Beijing on Monday over Chinese ships that sailed near the disputed Senkaku/Diaoyu islands in the East China Sea.

Business & Economics

Chinese exports fell for the first time in seven years as consumer demand continued to weaken elsewhere in the world.

The government urged domestic airlines to cancel or postpone aircraft orders to keep costs low during a period of weak demand for travel.

Science & Environment

The "taikonauts" from China's recent spacewalk mission are on a tour through Hong Kong and Macao where they are meeting with students, scientists, and the public at large.

Topping the United States for the first time, China published more scientific theses in 2007 than any other country.

China Moment

Perhaps it comes a surprise to no one, but a new report shows that more than 90% of China's richest people are the children of senior officials (Hat tip: WSJ China Journal).

Photo: ERIC FEFERBERG/AFP/Getty Images

NPR has an interesting piece on China's recent moves to prop up small coastal export businesses who are hurting with the slowdown in demand from the United States this holiday season:

Official statistics show that thousands of factories in Guangdong province have gone bankrupt this year. In the latest flare-up of unrest, laid off toy factory workers protested in Dongguan on Nov. 25, flipping police cars and smashing company offices.

This has Beijing worried. It has decided to protect exports by increasing export tax rebates and halting the three-year-long appreciation of China's currency against the dollar. And local governments in the delta have used billions of dollars to bail out small and medium enterprises.

China's top economic planner, National Development and Reform Commission Director Zhang Ping, defended the bailouts at a recent press conference.

"Helping these companies get through their current difficulties is entirely necessary and appropriate," Zhang said. "Otherwise, if too many factories go bankrupt, it will lead to many workers losing their jobs, and could increase social tensions and unrest."

On the other hand, Marketwatch reports that the country's growing golf sector was not so lucky:

Mission Hills, the self-proclaimed biggest golf club on Earth and recent host of the World Cup of Golf event, is sacking 2,000 employees, or 20% of its staff, according to a recent Bloomberg news report.

Yes, that's right. A golf course had 10,000 employees. At what point could a golf course be "too big to fail"?

(Hat tip: China Digital Times)

China recently released a list of the 15 foreigners who have had the biggest influence on China since its economic reforms 30 years ago. It's no surprise that the government -- led by its arch-technocrats, hydraulic engineer President Hu Jintao and geological engineer Premier Wen Jiabao -- chose to shine the spotlight primarily on Nobel winners, scientists, and bureaucratic heads.

Those honored include Chinese-American physicist Franklin Yang Chen-ning, who helped restore China's research community after the bleak years of the Cultural Revolution; Hein Verbruggen, the International Olympic Committee member who helped bring the Olympics to Beijing; and Seiei Toyama, a Japanese environmental expert who "worked on reforestation projects in regions subject to desertification," according to the Wall Street Journal.

If that list leaves you scratching your head, you aren't alone. It does contain one "big name" though: starchitect I.M. Pei, who was actually born in Guangzhou before he moved to Hong Kong as a child and later the United States.

It's surely right to honor these people for their work, particularly when they otherwise might be overlooked. But the list leaves me wondering: Which other foreigners might make the list? Michael Jordan? Kobe Bryant? After all, basketball is now the most popular sport in China. Bill Gates? Gorbachev? As long as it's not Ronald McDonald.

Photo by Paul Hawthorne/Getty Images

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In a new tally, Chinese officials said Monday that six infants died and nearly 300,000 were sickened by melamine-tainted milk during the recent scandal. A Ministry of Health statement revealed that 860 babies are still hospitalized with urinary-tract or kidney problems, 154 of them in serious condition.

Confidence in China's dairy industry remains weak as year-on-year dairy exports dropped 92 percent in October. However, heavily discounted valuations for Chinese dairy companies prompted the U.S. private equity firm KKR to invest $100 million in one Chinese raw milk supplier, seeking to ride the $18 billion market back up as regulation strengthens and people return to consuming milk.

KKR's vote-of-confidence shows that industry experts believe the Chinese government is capable of implementing and enforcing effective regulations. The scandal, however, which involved large numbers of small milk suppliers, illustrates the difficulty the government has had in addressing agricultural and food-safety problems before they become crises. Prevention is the next step.

General News

Taxi strikes spread to the city of Foshan in Guangdong province. Three-hundred drivers are protesting exorbitant management fees and lax regulation of unlicensed cabs.

Inflation has eased with the slowing economy, prompting Chinese officials to drop food-price controls enacted earlier this year.

Charter flights have retrived the last of more than 3,000 Chinese citizens that were stranded in Thailand after protesters shut down Bangkok's main airports.

Politics

China's vice premier, Wang Qishan, called for more concrete measures to stimulate domestic demand as Chinese exports continue to fall.

Some 770,000 people took the national civil service exam on Sunday. They are vying for 13,566 government spots.

Business & Economics

The China National Petroleum Corporation signed a $3.29 billion deal to build an oil pipeline in the United Arab Emirates.

Coca-Cola submitted an application to Chinese anti-trust regulators, hoping to win approval for its acquisition of Huiyuan Juice Group, which commands half of China's juice market. 

Science & Environment 

China launched the "Yaogan IV" satellite, which will conduct land surveys and aid in disaster prevention and relief.

China Moment

Earlier this year, retired New York City subway cars were turned into underwater reef habitats off the U.S. coast. As for Beijing's old subway cars, many now house impressionable youngsters. Beijing sent 60 cars to quake-affected Sichuan province, where they were converted for use as student dormitories.

Photos: China Photos/Getty Images

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As the global economic environment continues to worsen, the People's Bank of China has cut its key one year interest rate by 1.08 percent to 5.58 percent. It has also lowered the required reserve ratio that banks must maintain. This comes as the World Bank lowers its forecast for China's 2009 GDP growth from 9.2 percent to 7.5 percent. China's cabinet announced that it was studying measures to bolster struggling automotive, steel, petrochemical, and textile businesses.

Analysts have responded positively for the most part to the rate cut. They've applauded Chinese authorities for taking extraordinary measures to ease the slowdown and have looked favorably on China's continued use of interest rate tools to stimulate the economy, instead of depending on investment spending. More rate cuts are probably in store.

General News

A man convicted of killing six Shanghai police officers has been executed. His sentence drew sympathy and protest from many netizens due to reports that he had been previously abused by the police.

More than 500 workers at a toy factory in Southern Guangdong province clashed with police after they were fired. Some had worked at the factory for more than 10 years.

An official says the government has released more than 1,000 rioters involved in the protests in Lhasa, Tibet earlier this year.

Politics

Chinese President Hu Jintao met with Greek leaders yesterday, pledging more cooperation on trade, energy, and tourism.

The Ministry of Finance earmarked another 20 billion yuan ($2.9 billion) for reconstruction efforts in earthquake-hit southwest China next year. This comes on a top of 70 billion yuan already committed for this year.

Business & Economy

Huang Guangyu, one of China's richest men and head of the Chinese retail electronics giant Gome, has been detained by police who are investigating stock manipulation charges.

China Eastern airlines saw its losses on fuel-hedging trades surge to 1.83 billion yuan ($268 million) as the price of fuel plummeted. Other Chinese airlines have seen similar losses.

Science & Environment

A new report says pollution has made a third of the Yellow River, China's second longest waterway, unsuitable for farming, fishing, or factory use, and 85 percent of it unsuitable for drinking.

China Moment

A panda bit a student after he broke into its zoo enclosure, seeking a hug.

A young girl gazes out of her class window at the school in the village of Gulucan on Nov. 17, 2008 in Hanyuan county, Sichuan province, China. More than 60 farmers' families live in six isolated locations, perched high above a spectacular canyon in the area. Some farmers' children have to walk three hours to their school along the edge of a crumbling, narrow mountain path with a sheer, 5,000-foot drop on one side. (Photo by Guang Niu/Getty Images)

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Chinese President Hu Jintao was in Havana, Cuba yesterday, where he signed more than a dozen economic agreements between China and Cuba. The deals included purchases of Cuban raw materials such as nickel and sugar, a $70 million pledge to help renovate Cuban hospitals, and the postponement of debt payments that Cuba owes China.

Hu also met with former Cuban President Fidel Castro, whom he praised for having struggled "to safeguard state sovereignty" and adhered "to the path of socialism, thus winning respect from people worldwide, including the Chinese people."

Granma, the Cuban Communist Party mouthpiece newspaper, imparted praise on China's economic reforms the day before the visit, but also criticized the income disparities that have arisen. It will be interesting to see which of the reform precedents set by China, arguably the most important of Cuba's communist brethren, President Raul Castro may deem appropriate for the island nation.

General News

Twenty-one people are dead after a subway tunnel under construction collapsed in the eastern city of Hangzhou.

Thousands of protesters clashed with police in northwestern Gansu province over a government plan to resettle residents. This latest in a string of unrest in western and southern China has officials concerned that forthcoming economic hardship could cause isolated incidents to spread into wider discontent.

The U.S. Food and Drug Administration opened offices in Beijing, Shanghai, and Guangzhou to prescreen Chinese goods bound for the U.S.

Politics

China rejects the possibility of sending troops to Afghanistan.

Despite warming relations between China and India, India has cast suspicion on China's growing presence in the region, especially in The Maldives.

Business & Economics

A long awaited fuel tax will soon come into effect. Proceeds are to replace road tolls as a means to fund highway construction.

China's internet-based economy grew by 52.2 percent in the third quarter, with advertising and games making up 72.7 percent of the total income.

Science & Environment

In a bid to reduce chemical residues in milk, Chinese scientists are using herbs in place of hormones to increase milk production in cows.

A new study finds that 12 percent of Chinese children and adolescents in big cities are overweight and notes a growing rate of diabetes.

China Moment

After catching a Ningbo teenager illegally posting advertisements, officials had the boy cover his body with those advertisements as punishment. Naturally, the pictures wound up online and have sparked debat. (Hat tip: WSJ China Journal.)

ADALBERTO ROQUE/AFP/Getty Images

Good news for those of you who answered "China" on question 7 of the current FP Quiz: Your instincts are now correct. At the time of publication, U.S. Treasury data still showed that Japan held the most U.S. treasuries of any country. But new figures reveal that China has now taken the top spot. China increased its holdings to $585 billion in September, compared with $541.4 billion in August. Meanwhile, Japan shaved its holdings from a high of $600.7 billion in March of this year down to $571.4 billion in September.

The October figures will be even more interesting, though. Aside from the $585 billion, China was holding some $400 billion in Fannie Mae and Freddie Mac debt. With the acquisition of the two mortgage lenders by Hank Paulson, American Taxpayers, et al., China announced it would decrease its dollar holdings to diversify its foreign reserve portfolio. How much did China help fund the $700 billion TARP program? We'll know soon.

China Photos/Getty Images

In an interview that appeared on the front page of the Financial Times today, a senior Chinese military official gave some "hints" about China's aircraft carrier program. "Even if one day we have an aircraft carrier, unlike another country, we will not use it to pursue global deployment or global reach," promised Major Gen. Qian Lihua, director of the the Defense Ministry's foreign affairs office.

In last week's FP List, we called for Agent 007 to secretly gather evidence about China's naval capabilities. Far from being reassuring, these vague comments from the Chinese military make James Bond's (hypothetical) task even more urgent. We'd like to know the truth.

In response to the FT article, Richard Fisher, senior fellow at the International Assessment and Strategy Center, a security think tank, told me today that "China has waged an at times sophisticated and at times facile campaign of disinformation surrounding its aircraft carrier program."  He believes the world will never get a transparent description of China's carrier program.

The irony, though, is that this latest "campaign of disinformation", while growing more sophisticated, clings tightly to its facile notions. On the one hand, the Chinese government has deployed an English-speaking and "avuncular"  military official (as the FT describes Qian) to massage the international press corps, which is quite unprecendented for China's notoriously tight-lipped military. Yet the Chinese government seems to believe that other countries will not question its intentions, that simply averring it has no wide ranging naval ambitions is enough to divert the world's attention elsewhere.

When pressed about its technological capabilities, "the [People's Liberation Army] will seek to couch their missions in defensive terminology," Fisher says. "However, the usual approach ... is to assess the capability of the platform, its electronics and weapons, and then assume they will be used to the maximum envelope of those capabilities for any range of offensive and defensive missions." When China does launch an aircraft carrier, it's possible that the crosshairs will be trained only on the Taiwan Strait. But that certainly can't last forever. Qian will have to find an easier pill for the rest of the world to swallow.

Photo: KIM JAE-HWAN/AFP/Getty Images

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Analysts continue to weigh in on China's gargantuan stimulus package, announced Sunday. Many economists believe that China's economic growth will drop into the 7 percent range despite these latest measures.

One China scholar opined in the Wall Street Journal that the biggest potential for a stimulus package would be to pump funding into health and social services, which would ease burdens on consumers and promote domestic consumption. If the Chinese government chose to do this, it would be quite encouraging for the global economy. Unfortunately, the plan seems to be focused on infrastructure spending, the long-term effects of which are hard to predict. Some news outlets are even hailing this as China's "New Deal."

There is also growing discussion of possible motivations that Beijing may not have wanted to mention outright. Inklings of labor unrest have already begun to sprout up in cities across China, which have seen the closure of 67,000 export-producing factories this year. Plus, many of the country's five million college grads last year still have yet to find jobs. But overall, it's a waiting game until the government releases more details about the plan.

General News

Taxi drivers are on strike in the southern resort city of Sanya, adding to similar strikes in the past week in Gansu province and the city of Chongqing.

Beijing annouces a 240 billion RMB ($34 billion) plan to expand transportation infrastructure. The city's plan to quadruple the amount of subway track by 2012 comes after an already feverish period of development in the lead up to the Olympics.

An angry mob of 400 people attacked police in the southern city of Shenzen to protest the death of a motorcyclist who crashed when an officer tried to hit him with a walkie-talkie.

Politics

China reacted with criticism to a comment made by Indian Foreign Minister Pranab Mukherjee claiming that the disputed border region of Arunachal Pradesh belongs to India.

Former Taiwan President Chen Shui-bian was arrested as prosecutors prepared corruption charges.

Business & Economy

The Pearl River Delta, a major manufaturing region that includes the southern city of Shenzhen, saw 1,300 companies close their doors in the first nine months of the year.

Chinese CPI, the main indicator for inflation, dropped to 4 percent in October from 4.6 percent in the previous month, signaling a reigning-in of price increases but also an economic slowdown.

Science & Environment

Infectious diseases caused 1,000 Chinese deaths in October. The top culprits were AIDS, rabies, tuberculosis, hepatitis B, and neonatal tetanus, which together accounted for 90 percent of the deaths.

China unveiled its first complete map of the lunar surface.

China Moment

A slew of reactions to Barack Obama's victory speech appeared on China's Internet forums, many of them positive:

So touching! I approve! I continuously supported him and he did not let me down! ... I hope he can really help bring change to America, and also peacefully coexist with China, giving the world positive change!

Read other opinions here.

Photo: China Photos/Getty Images

On Sunday, China announced a humongous 4 trillion yuan ($586 billion) economic stimulus package to bolster its slowing economy, but many are already questioning how effective the plan will be, both for China and for the world.

The package, which includes spending on low-cost housing and infrastructure projects and new tax deductions for companies, comes at a cost equivalent to 15 percent of China's current GDP. (For comparison, the U.S. Treasury Department's $700 billion bailout plan is about 5 percent of U.S. GDP.)

Analysts have since pointed out, however, that not all of the spending is new. For instance, the 4 trillion yuan price tag includes funds already allocated for rebuilding after this year's earthquakes in southwestern China. Moreover, the funds will be disbursed over the next two years. Given the lag time between undertaking new projects and realizing their economic benefits, this may not be swift enough to prevent GDP growth from dipping below 8 percent -- which some analysts says is the minimum growth rate needed to absorb the millions of rural workers entering the work force. Slower growth could cause unrest and undermine the Communist Party's control.

Even if China's stimulus package does manage to lift the Chinese economy, will that benefit the United States? Some machinery manufacturers may be relieved to find new sales in China and oil companies may be pleased to see Chinese demand propping up oil prices, but much of China's spending will probably go toward procuring raw materials from developing countries for projects such as highways and airports. Given that consumer spending accounts for more than two thirds of U.S. economic activity, Chinese infrastructure spending is unlikely to get the American growth machine going again.

The most magnanimous gesture China could make would be to invest a portion of its estimated $1.9 trillion in U.S. currency reserves back into the United States, perhaps to spur its own badly needed round of infrastructure spending. That's one gift it'd be nice to see under the Christmas tree this year, but the chances seem pretty slim. It looks like Americans will have to rely on their own lawmakers for that shot in the arm.

Photo: MARK RALSTON/AFP/Getty Images

Top Story

A historic meeting between Chinese and Taiwanese officials continues in Taipei today. The five-day visit by the top mainland official on cross-strait relations, Chen Yunlin, marks the highest-level talks between Taiwan and the mainland since the two split in 1949. The talks have already yielded an agreement on expanded cross-strait flights, trade, and mail links, and is slated to address greater cooperation in the financial industry.

Taiwan's opposition Democratic Progressive Party (DPP), which favors independence, is keeping up the pressure with mass protests in Taipei. DPP spokeswoman Cheng Wen-tsang has complained that "people's rights, personal liberties, freedom of speech and judicial rights were seriously violated" by the signing of the agreements.

However, recent DPP measures promoting independence, including a referendum earlier this year that sought the public's approval for Taiwan applying for U.N. membership, have fallen flat. With some 1 million Taiwanese businessmen working on the mainland, more agreements liberalizing trade and travel will likely be the norm.

General News

Flooding and landslides caused by torrential rain kill 51 in southwestern China.

Striking taxi drivers in Chongqing smashed 103 cabs and three police vehicles while protesting the high fees that taxi companies extract from drivers.

A newly proposed regulation could make Aug. 8, the anniversary of the opening of the Olympic Games, a national fitness day and require public sports facilities to admit the public for free.

Politics

President Hu Jintao and Premier Wen Jiabao congratulated Barack Obama on his election victory.

A panel of Chinese experts foresee China becoming a full welfare state with universal health care and old age pensions by mid-century.

Business & Economy

China and other Asian countries are eager to see whether a President Obama will follow through on protectionist campaign promises.

Bright Dairy & Food Co., a major name in the tainted milk scandal, posted a third quarter loss of 277 million RMB (US$41 million), compared to 390 million RMB in profits (US$57 million) a year ago. Other major dairy producers expect similar results.

Science & Environment

China plans to take to the skies with its own commercial jumbo jet before 2020.

In preparation for the 2010 World Expo, Shanghai has enacted new green policies that seek to reduce pollution and stimulate investment in environmental protection.

China Moment

Release the hounds! Er. . . the Chinese public, I mean. A swarm of Chinese Internet users tracked down and humiliated an official accused of assaulting a girl.

Photo: PATRICK LIN/AFP/Getty Images

In what is being billed as an "historic" agreement, Chinese and Taiwanese officials concluded a pact today that increases the number of cross-strait airline flights and establishes new trade and postal links. The goal is to eliminate the hassle of making travelers stop in Hong Kong on their way between the mainland and Taiwan and to ease similar restrictions on cargo and mail. To be sure, the lead-up to today's deal was a gradual process. Direct charter flights first took off in 2005 and regularly scheduled direct flights began in July of this year.

What all this means for Taiwanese sovereignty, though, is unclear. Does breaking down barriers between Taiwan and the Mainland increase Taiwan's stature as a sovereign state? Or does it expose itself to greater control from Beijing should the Communist Party leaders ever decide to use new economic ties as leverage? Some half a million protesters took to the streets of Taipei a week and a half ago, fearful that Taiwan President Ma Ying-jeou's engagement policies could lead the small island state right into Beijing's hands.

This is a relationship built on ambiguity though. So long as Taiwanese politicians aren't beating the drum for independence and economic ties continue to strengthen, it is hard to imagine what kind of catalyst could induce Beijing to demand immediate reunification. Taiwan's independence would be a humiliating defeat for Beijing, but forcing its hand on reunification would spark a major, and needless, international incident. Thus, a continuation of Taiwan's muddled identity with ever closer economic ties to the mainland seems to be viable indefinitely.

Photo: SAM YEH/AFP/Getty Images

Acrobats from the Jiangxi Acrobatic Troupe of China perform 'Candle Contortionists' at the 8th China Wuhan International Acrobatics Art Festival on Oct. 28, 2008, in Wuhan of Hubei province, China. The festival, one of the major acrobatics events in the country, attracts performers from more than 12 countries and regions.

Photo: China Photos/Getty Images