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from Breakingviews:

China index: Beijing cleans up skies, not its act

By Katrina Hamlin

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

Skies above China’s big cities are turning blue, as its economic warning lights flash red. Across the country, PM2.5 readings – a measure of small particulates in the air – fell by 6 percent year on year in the first six months, Greenpeace reported in July. Beijing even scored the city’s least smoggy month since January 2011 according to data from the U.S. Department of State. Dirty industrials are leaving town and shutting down – but that’s just a quick fix.

If grey skies are a sign of economic activity, the clear air suggests things are slowing fast. Breakingviews’ Tea Leaf Index, an alternative measure of China’s economic prospects, dropped to its lowest level since May 2009 in June. Signs are appearing that the industrial economy is in some trouble – for example, diesel demand is likely to fall for the first time in a decade in 2014, Reuters reported on Aug. 7.

Graphic: Breakingviews Tea Leaf Index

But since clean air became a target, it has also become harder to interpret. Only nine of 161 Chinese cities achieved air quality monitoring standards in the first half of this year, according to the Ministry of Environmental Protection. Some problems have just been shunted from one area to another. While Beijing enjoyed a 10 percent year-on-year fall in PM2.5 levels in the first six months, Jiangsu suffered a 10.6 percent increase as steel production leapt 9 percent year on year, soaking up demand from places like Hebei where many plants closed.

from Breakingviews:

Microsoft’s China dream sorely strains credibility

By Ethan Bilby

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

Xbox gamers fear the “red ring of death”, a flashing light that can herald system failure. Microsoft, which makes the consoles, must be awaiting a similar sign in China. After 22 years, the tech giant has achieved little in the country, which looks to account for around 2 percent of revenue. Cloud services may multiply that over time, but political headwinds are raising the cost of business - possibly too high.

from Breakingviews:

U.S.-backed China tech shows investment curb folly

By Robyn Mak

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

China’s tech companies may be Beijing’s darlings, but they have U.S. dollar funding to thank. The next generation of upstarts look likely to continue the pattern. Foreign currency funds poured $5 billion into venture capital the first half of this year – three times more than local funds raised. The economic benefits these foreign investors bring make the rules keeping them out harder to justify.

from Breakingviews:

Yahoo’s Mayer nears post-Alibaba reckoning

By Richard Beales

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

Yahoo is a big company with a much smaller one struggling to get out. A 22.5 percent stake in Alibaba accounts for well over half the U.S. internet group’s roughly $36 billion market capitalization, according to a new Breakingviews calculator. With the Chinese e-commerce giant likely to go public next month, Yahoo Chief Executive Marissa Mayer will find out how investors value the businesses she actually runs.

from Expert Zone:

Afghanistan a building block for China-India ties

(Any opinions expressed here are those of the author and not of Thomson Reuters)

The appointment of a former ambassador to Kabul and New Delhi by China to the role of Special Envoy for Afghanistan highlights China’s thinking of what it can do in Afghanistan.

China is not seeking a leadership role in the country, but is rather looking for regional partners to support its efforts. A key partner is being sought in New Delhi where the Narendra Modi administration has welcomed Xi Jinping’s early overtures for a closer broader relationship. The opportunity presents itself that Afghanistan’s two largest Asian neighbours might be on the cusp of closer cooperation to help the nation onto a more stable footing.

from Breakingviews:

China’s political purges call for financial sequel

By John Foley

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

The formal investigation of China’s former security chief Zhou Yongkang, almost ten months after he was last seen in public, makes compelling viewing. What is needed next is a financial sequel.

from Breakingviews:

China throws weight around on car parts costs

By Ethan Bilby 

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

China’s competition watchdog has forced luxury carmakers into a U-turn. The whiff of a probe into vehicle parts was enough to get Audi and Jaguar Land Rover to reduce their prices, even though neither has been publicly deemed to be abusing its position. Experience shows in China it is better to admit guilt early than risk bigger fines, or lose access to a critical market.

from Breakingviews:

Qualcomm turns from predator to prey in China

By Ethan Bilby

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

Bad news keeps piling on for Qualcomm. Beijing has branded the U.S. chipmaker a monopolist, even as its dominance, which rests on smartphone chips and 3G patents, may be sliding. If that weren’t enough, some Chinese customers aren’t paying their dues. As friction over U.S.-China spying persists, things may only get worse.

from Breakingviews:

China’s old meat is a corporate health warning

By John Foley 

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

Old meat in China’s fast-food chain brings a health warning for foreign companies doing business in the country. After getting fat on rapid growth, some are discovering nasties hidden within their ample folds.

from Photographers' Blog:

Uighurs of Shanghai

Shanghai, China
By Aly Song

The traditional home of China’s Muslim Uighur community is the far western state of Xinjiang, a region that has been plagued by violence in recent years.

The government blames a series of attacks on Islamist militants and Uighur separatists, who it says want to set up an independent state called East Turkestan. But human rights activists say that government policies - including restrictions on Islam - have stirred up the unrest, although the government strongly denies this.

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