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Issue 43 (January 2000)
The Illicit Asset Stripping of Chinese State Firms
his paper reveals the processes and mechanisms of asset stripping of Chinese state firms during the 1980s and 1990s. The diversion of firm assets into the hands of managers has been occurring on a massive scale. Although market economies, in comparison with socialist systems, are generally marked by clearly defined property relations, the shift from state socialism to market capitalism does not uniformly lead to a clarification of property rights. Quite the opposite: the transition often witnesses property relations becoming far more obscure than before. By designing hybrid property forms, managers can capture firm assets either directly by usurping them or circuitously by abusing them.
The Disarticulation of Hong Kong's Post-Handover Political System
Hong Kong's post-handover political system has been shaped by five critical, sometimes conflicting, forces: the role of the Chinese government, the power of the business lobby, the shifting policies of the British government, the rise of democratic parties and the declining government legitimacy in the wake of the Asian economic crisis. As a consequence of the divergent impact of these factors, the institutional framework has become increasingly disarticulated and relations between the bureaucracy, executive, legislature and judiciary are uncoordinated, poorly developed, fractious and dysfunctional. This article examines the implications of these developments for politics in Hong Kong and for the coherence and implementation of public policy.
Phillip C. Saunders
Supping with a Long Spoon: Dependence and Interdependence in Sino-American Relations
articipation in the world economy offers China a means of increasing national power and fulfilling long-standing ambitions to wield greater international influence. Yet economic interdependence also implies increased vulnerability to foreign pressures. This dilemma is most acute in China's relations with the United States, which dominates the current international system and is able to either facilitate or obstruct China's emergence as a great power. Chinese leaders have accused the United States of pursuing a strategy of 'peaceful evolution' and have denounced US attempts to use economic leverage to force China to improve human rights conditions. Nevertheless, economic relations have continued to deepen and China's dependence on the US economy has further increased.
This paper explores the tension between Chinese fears of US dominance and its willingness to tolerate a high degree of interdependence. Since the 1955-66 missile tests in the Taiwan Straits, both the United States and China have sought to stabilise bilateral relations and are now working toward a 'constructive strategic partnership'. Does the change in policy toward the United States reflect a new acceptance of interdependence or merely China's conclusion that it has few good alternatives to a constructive relationship with the United States? The paper argues that Chinese leaders have sought to build mutual dependence to reduce the United States' ability to place economic pressure on China, and that the need for rapid economic growth to maintain social stability has also compelled a greater degree of economic dependence.
Robert P. Weller and Jiansheng Li
From State-Owned Enterprise to Joint Venture: A Case Study of the Crisis in Urban Social Services
This case study of the conversion of a state-owned steel mill to a joint venture with a foreign investor details one attempt to resolve the social problems that arise from privatisation in China. These problems include finding ways to deal with unemployment, pay pensions and provide social services such as education, health care and housing. The general strategy in this case has been to find mechanisms to delay the full impact of the transformation for several years, in the hope that continued market growth will create acceptable alternatives. Much of the impact will be borne by new companies attempting to carry on the functions of the old state enterprise, but without its original economic base. These companies are unlikely to be profitable. Other problems result from the gradual bleeding of assets through bad debts and 'spontaneous privatisation', where factory profits have been siphoned off to a private enterprise run by factory managers for personal profit.
Criminality and the Policing of Migrant Workers
The control of migrants who come from the countryside to work in the cities is a high policy priority for China's city governments. Migrants account for about half of all urban criminals and while programs to control migrant crime have been put in place, governments have been slow to see the problems that migrants face in finding work or a secure source of income. Urban governments offer migrants little in terms of services or help. Migrants in difficulty are particular targets for detention and deportation back to the countryside. The article surveys migrant-worker prisoners and finds most crimes involved property and money and 65 per cent were committed when workers were in dire economic circumstances. The article also finds that in peri-urban areas, law enforcement has increasingly been taken over by temporary local agencies that have no legal authority, leading some regulatory personnel to infringe the law - exacerbating conflicts and causing regulatory crises.