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China review of the year 2010
As the world economic recovery continued to stumble, China experienced a combative year on the world stage in 2010, reveling in its ‘new’ power status as the world’s second-largest economy, but resisting pressure from the ‘old’ powers to become a more responsible stakeholder in world affairs.
Liu Xiaobo was jailed for writing the Charter 08 pro-democracy petition Photo: EPA
Protesters scream for the freedom of Nobel peace laureate Liu Xiaobo Photo: AP
Top men: Hu Jintao, left, and designated successor, Xi Jinping Photo: AP
By Peter Foster 3:40PM GMT 15 Dec 2010
Liu Xioabo wins Nobel Prize
At home China’s leaders faced public calls for political reform in October after the dissident Liu Xiaobo, a former literature professor jailed for writing the Charter 08 pro-democracy petition, was awarded the Nobel peace prize in October.
The leadership, already nervous of unrest after a wave of kindergarten stabbings earlier in the year, responded with a tightening of internet censorship, putting nearly 50 dissidents under house arrest and cracking down on lawyers who challenge state power.
A new Chinese leader emerges from the shadows
Later in October a secret meeting of senior Party officials identified Xi Jinping, the 57-year-old son of a renowned Communist Party revolutionary, as the man likely to succeed Hu Jintao in becoming China’s next president in 2013.
Currency issues dog the US-China relationship
Trade frictions with the US and Europe continued to deepen in 2010. As the US unemployment grew, so did increasingly strident calls in Washington for China to allow its currency, the Renminbi, to rise in value against the dollar.
Although Beijing snapped the dollar peg and allowed the currency to rise a few per cent against the greenback, it refused to countenance a significant appreciation, arguing that China’s economy, and most particularly its exporters, were not yet strong enough to withstand the shock of a major revaluation.
Britain tries to boost China trade
Against this difficult economic background, David Cameron led Britain’s largest trade delegation to China in 200 years in November, hoping to boost UK exports and improve market access for British companies. The visit went off with any major diplomatic embarrassments, but Mr Cameron won no major trade concessions. Looking on the bright side, the UK’s pavilion at the 2010 World Expo in Shanghai won the gold award for best design.
China applies the economic brakes
At home, China’s economy began to show signs of over-heating after two years of massive economic stimulus, with sharply rising food price inflation and spiraling house prices raising fears that China’s economy was becoming an unsustainable credit bubble.
Policy makers quickly ‘tapped the brakes’, raising Interest rates for the first time in two years, introducing controls on speculative property-buying and, after a two-year lending splurge, ordered China’s banks to raise their capital ratios on several occasions.
A bruising year for diplomatic relations
China’s representatives abroad earned a reputation for tough-talking and at times even boorishness in 2010, with the diplomatic fall-out from the Copenhagen climate change summit reverberating throughout the year. The Obama administration toughened its policy on China, infuriating Beijing in July when it described the South China Sea – China’s backyard - as a “core interest”.
Efforts to heal divisions before a visit by Chinese president Hu Jintao to Washington next year came unstuck in December after North Korea shelled a South Korea village – an act Beijing refused to condemn. While Washington urged Beijing to bring use its influence to bring North Korea to heel, China called for a return to the Six Party disarmament talks. The US, Japan and South Korea all refused the invitation, laying the groundwork for a difficult year ahead.
