Tuesday, November 29, 2011

S'pore can do better than Hong Kong

THE Housing Board stated that the shrinking sizes of flats over the years are due to the need to maximise Singapore's limited land space and adapt to shrinking household sizes. And according to HDB, this does not mean a lower quality of life since the living space per person has actually improved ('Sizes of HDB flats are shrinking. Sizes of households shrinking too'; last Saturday).

Why smaller isn't the way to go

BY MAKING flats smaller ('Sizes of HDB flats are shrinking'; last Saturday), the Housing Board is working against several government initiatives: encouraging married couples to have kids; encouraging children to live with their parents; and encouraging more women to return to the workforce.

Monday, November 28, 2011

Why have auditors at all?

SIX months ago, accounting firm PricewaterhouseCoopers (PwC) said MF Global and its units 'maintained, in all material respects, effective internal control over financial reporting as of March 31, 2011'. A lot of people who relied on that opinion lost a lot of money.
By Jonathan Weil

MF Global filed for bankruptcy on Oct 31. Last week, the trustee in the liquidation of its United States brokerage unit said as much as US$1.2 billion (S$1.6 billion) of customer money is missing, perhaps more. Those deposits should have been kept segregated from company funds. It seems they were not.

What is the point of having auditors make reports like this? And are they worth the cost?

When an auditor certifies that a client's internal controls are effective, that is supposed to mean the company can do basic functions like maintain accurate financial records, detect unauthorised transactions, and keep track of its receipts and expenditures. We know MF could not do these things during the final days before its bankruptcy filing, when former New Jersey governor Jon Corzine was still its chief executive officer.

'Their books are a disaster,' Mr Scott O'Malia, a commissioner at the Commodity Futures Trading Commission (CFTC), told the Wall Street Journal in an interview.

The newspaper also quoted Interactive Brokers Group CEO Thomas Peterffy as saying: 'I always knew the records were in shambles, but I didn't know to what extent.' Interactive Brokers backed out of a potential deal to buy MF last month after finding discrepancies in its financial reports.

So, to believe PwC got it right when it blessed MF's controls in May, you would have to accept the notion that MF's controls were effective in March, and did not start going bad until some time later.

Although we should not rule out anything, this scenario seems implausible. One lesson from the 1980s savings-and-loan crisis is that when a financial institution fails, it is almost always true its internal controls were poor - and had been so for a long time. Otherwise, it would not have failed.

There is more at stake here than the missing US$1.2 billion. Besides MF, other companies that use PwC's New York office as their auditor include Goldman Sachs and JPMorgan Chase. Both banks presumably are too big to fail, meaning taxpayers would be on the hook if they ever blew up. If PwC cannot spot control weaknesses at a relatively small shop like MF, which had US$41 billion of assets, it is a bit much to expect it would catch anything materially amiss at Goldman, which has US$949 billion of assets, or at a serial acquirer such as JPMorgan, with US$2.3 trillion of assets.

Fortunately for PwC, there is no better alternative. What can Goldman or JPMorgan do? Switch to KPMG? Ernst & Young? Deloitte & Touche? Their track records are no better.

The reason MF had to get an outside audit report on its internal controls was that the Sarbanes-Oxley Act requires it. That law was enacted in 2002 in response to a wave of audit failures at big companies such as WorldCom and Enron.

Thanks in part to the new workload, audit fees at the Big Four accounting firms skyrocketed. So, too, did the number of financial restatements by public companies, which seemed to show the auditors were drilling down and catching lots of errors. For a while, it looked like the new rules were working.

Then a backlash hit. Corporate executives, lawmakers and even Securities and Exchange Commission officials complained the auditors were too strict. The number of restatements plunged. Audit fees stopped soaring, and overall have been little changed since 2007, according to a July report by Analyst's Accounting Observer editor Jack Ciesielski.

Many companies' audit fees plunged, suggesting auditors there were doing less work. In 2007, MF Global paid PwC US$17.1 million in audit fees. By this year, that had fallen to US$10.9 million, as warning signs about MF's internal controls were surfacing publicly.

In 2007, MF and one of its executives paid a combined US$77 million to settle CFTC allegations of mishandling hedge-fund clients' accounts, as well as supervisory and record-keeping violations. In 2009, the commission fined MF US$10 million for four instances of risk-supervision failures, including one that resulted in US$141 million of trading losses on wheat futures.

Suffice it to say, PwC should have been on high alert.

On top of that, PwC's main regulator, the Public Company Accounting Oversight Board, released a nasty report this week on PwC's audit performance. The agency cited deficiencies in 28 audits, out of 75 it inspected last year.

The tally included 13 clients where the board said the firm had botched its internal-control audits. The report did not name the companies. One could have been MF, for all we know.

In a response letter to the board, PwC's US chairman Bob Moritz and US audit practice head Tim Ryan said the firm is taking steps to improve its audit quality.

But the point of having a report by an independent auditor is to assure the public that what a company says is true. If the reports are not reliable, they are worse than worthless, because they sucker the public with false promises.

Maybe, just maybe, we should stop requiring them altogether.


He returns to China from US, but now he can't leave

BEIJING: After two decades of working as a successful engineer in the United States, Mr Hu Zhicheng (right) decided to return to China in 2004 and apply his rich experience to designing catalytic converters for its booming automotive industry.

'I saw how polluted the air was here, and thought I could make a difference,' said Mr Hu, a naturalised US citizen who has a doctorate in engineering.

Now, it seems he cannot leave.

The last three times he tried to board an aeroplane and return to his family in Los Angeles, Mr Hu, 49, was turned away by Chinese border agents, who claimed he was a wanted man.

The problem is, he cannot find out exactly who wants him and why.

Mr Hu, an inventor trained at the Massachusetts Institute of Technology with 48 patents and a number of prestigious science awards to his name, was detained for 11/2 years starting in 2008 after a former business associate accused him of commercial theft.

The charges were so spurious that prosecutors withdrew the case - a rare gesture in China's top-down legal system.

But since his release 19 months ago, his life has been in limbo, and his family has grown increasingly frantic.

He writes to powerful Communist Party officials, who he imagines might control his fate. A coterie of influential friends and colleagues has been lobbying on his behalf. And this month, his daughter, a sophomore at the University of California, Berkeley, began a petition campaign that has garnered more than 50,000 signatures.

Mr Richard Buangan, a spokesman for the US Embassy in Beijing, said US diplomats have had little success in pressing his case with Chinese officials.

'No authority has been cooperative with our request for information on the restrictions that block his departure from China,' he said.

Mr Hu's predicament highlights the potential perils of doing business in China, where commercial disputes can easily become criminal matters, especially when the politically well-connected use the country's malleable legal system to bludgeon rivals.

Most worrisome, legal experts say, are the country's vague commercial secret laws, which state-owned enterprises - the companies that dominate China's economy - sometimes wield to protect information related to production, procurement, mergers and strategic planning.

Anecdotal evidence suggests that overseas Chinese are more vulnerable to such abuses than their non-Chinese compatriots.

Last year, Stern Hu, an Australian Chinese mining executive, was detained after a deal between his company Rio Tinto and the state-owned Aluminium Corporation of China fell through. Convicted of stealing trade secrets and bribery, he was sentenced to 10 years in jail after a largely closed trial.

Xue Feng, an American Chinese geologist who is serving eight years in jail on similar charges, said he was tortured during his interrogation. His supporters, including US diplomats, insist that the oil and gas industry data he sold was publicly available.

In 2008, the authorities executed Wo Weihan, a Chinese biomedical researcher who had returned from Europe to start a medical supply company in Beijing. Tried in secret, he was accused of espionage, but details of his crimes were never disclosed.

Even as official policies seek to lure China-born inventors, academics and entrepreneurs with housing perks and financial incentives, lingering anti-Western xenophobia nurtured during the Mao years sometimes taints them as unpatriotic for having left.

'It is kind of a reverse racism,' said Mr John Kamm, executive director of Dui Hua, a US human rights group that frequently advocates on behalf of detained foreign nationals in China. 'If you are ethnic Chinese with a foreign passport, you are really not considered a foreigner.'

Mr Hu Zhicheng, whose long resume includes stints as a researcher in Japan and more than a decade working for US designer of catalytic converters Engelhard Corp, would seem to be the ideal returnee.

In 2006, when he took a job as chief scientist for Wuxi Weifu Environmental Catalysts, a company in eastern Jiangsu province, he also brought along his wife and their two US-born children, in part, he said, because he wanted them to become steeped in Chinese language and culture.

His return coincided with a surge in domestic car production and government-led efforts to reduce emissions. The company prospered, and so did Mr Hu, who eventually became Wuxi Weifu's president. It now provides catalytic converters for half of all China-made cars.

His troubles began after his company refused to buy components from Tianjin-based Hysci Specialty Materials, which once supplied Engelhard.

According to Mr Hu and his lawyers, Hysci would not take no for an answer. They say Hysci's well-connected chief executive, Mr Dou Shihua, sent Tianjin public security agents to Wuxi Weifu to pressure Mr Hu to change his mind.

The police raised allegations of stolen trade secrets, but also suggested that the accusations would evaporate if the two companies did business together. Mr Hu would not budge.

'We have a system of quality control, and even one word from me could not change that,' he said.

In the end, the veiled threats gave way to an arrest, and Mr Hu was put in jail in Tianjin.

The patent infringement case prosecutors eventually built against him cited technology that has been publicly available in the US for decades, according to several scientists who rallied to his defence.

But even after prosecutors withdrew the case and Mr Hu was freed, he found his return home to the US blocked by immigration officials, who claimed he was still wanted by the Tianjin police. Each time he or his lawyer contacted the authorities there, however, they were told there were no such restrictions.

One of his lawyers said he believed Mr Dou was still using his influence to exact revenge or get a deal. Over the phone, a Hysci sales executive refused to comment on the case. The Tianjin Public Security Bureau hung up before answering queries on Mr Hu.


Sunday, November 27, 2011

'Zeronauts' needed in these dangerous times

At the stroke of midnight on Oct 31, countries across the world, led by the United Nations, celebrated a series of symbolic seven-billionth babies being born.

While parents were congratulated and babies photographed by local press, one man - a prominent authority on sustainable development - posed a sober thought amid the revelry.

Mr John Elkington, executive chairman of London-based environmental consultancy Volans, notes that though this might be a symbolic moment for humanity, it also marks 'dangerous times'.

Speaking to The Sunday Times in Singapore recently - he was here to speak at a forum held by the Singapore International Foundation - Mr Elkington, 62, says the problem humanity faces today is that it has inherited from the 19th and 20th centuries economic and business models, technologies and ways of thinking about the world which are now 'actively dangerous'.

'When I was born, there were fewer than three billion people in the world. This month, we hit seven billion and in these circumstances, resource availability and environmental security are severely threatened,' he said.

Going by UN estimates, the world population is set to rise further - reaching 10.1 billion in the next 90 years, or reaching 9.3 billion by the middle of this century. Current consumption patterns are simply unsustainable, given this scenario.

Mr Elkington says he recognises that some governments and business leaders have been responding to these concerns by adopting policies and strategies that ensure the sustainable and efficient use of resources.

'But I don't think they are remotely addressing the agenda yet, or introducing the disruptive change we need to see,' he says bluntly.

Mr Elkington is regarded widely as a pioneer thinker on sustainability - he originated the term 'triple bottom line', or people, planet and profit, which has become popular in business speak and often used in conveying the idea of a socially responsible business.

It is a way of measuring success beyond financial performance to include the environmental and social impact of an organisation.

These days, he is working on a new book, to be published early next year, and has coined a new term that describes people who are leading the way in solving the world's problems - the 'Zeronauts'.

He explains to the forum, aptly called 'Ideas for a Better World': In the last century, astronauts launched into space in search of new worlds, and in the process, catalysed the evolution of everything from non-stick frying pans to mini-computers to satellite telecommunications.

Their work forced humans to recognise that Earth is a very rare planet indeed - and our only home for the foreseeable future.

Today, there is a new breed of explorers and entrepreneurs - the Zeronauts - who are pioneering novel ways to create wealth that is in tune with the 21st century reality of a human population pushing towards 10 billion people.

Central to this idea of the Zeronauts is that they are putting the world on a path to a zero impact economy - that is, one with zero risk, zero emissions, zero pollution and waste, zero biodiversity loss and zero population growth, as defined by Mr Elkington.

He cites one person he identifies as a Zeronaut in the book: Microsoft founder Bill Gates.

But Mr Elkington says Mr Gates is a Zeronaut not due to his leadership while he was in Microsoft, but rather now in running the Bill and Melinda Gates Foundation, which is pursuing objectives towards a zero impact economy.

'Unusually, for a business leader in the United States, he's talked about the need to drive towards zero carbon, but he's also addressing it in areas like public health care, in polio and malaria; he's trying to drive these diseases to zero,' notes Mr Elkington.

Professor Simon Tay, chairman of the Singapore Institute of International Affairs, who was in a panel discussion with Mr Elkington at the forum, notes that if Singapore were to measure itself based on this idea of the zero impact economy, then it has not been bold enough.

It was only recently that the local bourse launched voluntary guidelines for companies to report on their operations and their impact, he adds.

So does Singapore have what it takes to produce such a Zeronaut?

To this, Mr Elkington says: 'I'm deeply positive about Singapore, but I do recognise that the entrepreneurial instinct (here) is not as great as it needs to be.'

He explains that, typically, disruptive innovation comes from places where people are 'profoundly uncomfortable' because the current system is not working.

Singapore is an efficient society 'where things work' and this may take away the urgency to change things disruptively, he adds.

Still, Singapore has shown leadership by planning for long-term timeframes in its investments and that is why Volans, in a recent report called 'The Future Quotient', identified the Republic as one of 50 top examples of leaders that have shown the capacity to create value in the long term.

Mr Elkington defines long term as a time horizon of beyond 33 years - the defined age of a generation. The report profiles examples of innovation which are 'future- centric' and inter-generational in nature.

'Singapore has accumulated a huge amount of wealth over time and trained, educated and skilled up its population in a way that is highly unusual,' he says.

'So although the average person might not have this raw hunger to change the world, there's the capacity to do so once the mind is made up, as Singapore has demonstrated with its capabilities in water technology,' he adds.

That said, he admits that ordinary people are 'unlikely to be driven by the concept of zero'.

The Zeronaut agenda is a business and governmental concept which he hopes will help leaders see that they are defining the world's sustainability challenge too loosely.

'A relatively small number will come out of this revolution... but those who do will be the Amazons and eBays of the future.'


Nothing concrete in earlier plans for Bukit Brown

Last Sunday's article, 'Bukit Brown road project 'can't wait'', reported that 'strangely, the URA said, no one raised a ruckus when plans highlighting the area's intended future use were displayed for feedback' in 1991 and 2001, when the Concept Plans were released.

This argument is being used to refute current public opinion against the transport and housing developments in Bukit Brown cemetery.

In 1991 and 2001, there were no concrete announcements on the intrusion of physical infrastructure like the road. If there had been a public outcry then, the Government would have replied, understandably, that such an outcry was premature as nothing concrete had yet been planned.

More importantly, we were a different country two decades ago. Thanks to nation-building efforts by the Government, Singaporeans today are more conscious of their national identity and are thus sensitive to any loss of heritage.

With a bigger population now, Singaporeans are hungry for more open spaces and recreational areas, of which Bukit Brown is one.

We also now have new know-ledge of just how rich a historical and ecological resource Bukit Brown is.

Arguments for the conservation of the area were put forth by the Nature Society (Singapore) in its Feedback for the Inter-Ministerial Committee Project on Sustainable Singapore: Lively and Liveable City in 2009, and by the Singapore Heritage Society in the book, Spaces Of The Dead: A Case For The Living, published in May this year.

The Urban Redevelopment Authority Concept Plan is intended for long-term planning and its zones are broad and flexible.

For example, Pulau Ubin was also zoned for residential use in 1991 but it was later re-zoned as 'open space and reserve land' in the 2001 Concept Plan.

To imply that present-day concerns are invalidated by not having been raised 10 or 20 years ago is a flawed premise that leads to sub-optimal decision-making based on outdated information and analysis.

It also denies the possibility for any generation to determine its own immediate future and those of its children.

Chua Ai Lin
Terence Chong
Executive Committee Members
Singapore Heritage Society

Toddler tragedy still haunts market

The red ink marking the spot where the tragedy took place has grown so faint it is barely visible. The police have stopped coming by to question witnesses. The media throng has disappeared.

By Peh Shing Huei, China Bureau Chief, In Foshan (Guangdong)

More than a month after toddler Wang Yue died after being hit by not one but two vehicles here in an incident that shocked China, much of Guangfo Hardware Market has regained a semblance of normalcy.

But probe a little deeper and the shopkeepers of this sprawling wholesale centre are still struggling to shed their collective cloaks of shame.



'Unless they are my suppliers or my customers, I don't talk to them. That's just how it is here. I've been here for 10 years but I hardly know the guy next door.'

MADAM XU RUIFANG, whose electrical cables shop is adjacent to the spot where the toddler was run over. Most shopkeepers in the area do not know one another.

Many Chinese pointed fingers at the people in this industrial market, accusing them of being cold and apathetic.

The belief was that the 18 passers-by who ignored the dying two-year-old nicknamed Little Yue Yue, before a rag-and-bone collector picked her up and called for help, were from the market.

Clearly, such criticisms hurt. Several of those in shops just metres from the accident refused to be interviewed by The Sunday Times.

Others quickly said they were not around when the girl was run over by the vehicles.

'I wasn't here. I found out about it on TV, just like you. I left just before it happened,' said Madam Xu Ruifang, whose electrical cables shop is just adjacent to the tragic spot.

A sealant shop owner, who wanted to be known only as Madam Li and whose table faces the spot just a few steps away, also said she had closed her shop when the incident occurred.

Another shopkeeper, from central Hunan province, said he was around but did not hear or see the accident, even though his shop selling hard hats and screwdrivers had a clear line of sight.

'A car blocked my view. A rack also blocked me from seeing anything. It was raining heavily that evening and I didn't hear a thing,' he said, raising his voice as he smoked a cigarette. He declined to be named.

He swore that he would have helped if he had witnessed the incident. 'I would have made a call. It doesn't cost much these days to use your mobile phone anyway.'

He did not know Yue Yue or her parents, who used to run a shop in the market but have since closed it down and reportedly moved to nearby provincial capital Guangzhou.

Neither did any of the other shopkeepers. In fact, most of them do not know one another too.

In this massive market as big as 56 football fields, there are migrants from all parts of the country. Most stick with those from their hometowns and do not even know their neighbours.

They flocked to coastal Guangdong province to make money and improve their lives, but share little else in common.

'We do chat sometimes but don't ask me their names. We just call one another 'boss',' said Madam Li.

'I'm from Guangdong but most of the people here are from other provinces and we speak different dialects. It's hard to communicate.'

They do not share meals either. Most of them cook on makeshift stoves in their shops and wolf down their lunches, sitting on stools with a few colleagues.

There are more than 2,000 shops in the market but little sense of community under the metal roof.

There is no common area to gather. When night falls, the shopkeepers pull down their shutters, retreating upstairs where some of them live or driving off in motorcycles or small vans.

As the Hunan shop owner said: 'Talk to others? Where am I going to find the time? I'm here to run a business, you know.'

Analysts believe the Guangfo market is a microcosm of China as a 'society of strangers', where people are indifferent to those who live and work near them.

This came about as the Chinese enjoyed an unprecedented freedom of movement, leaving their familiar rural communities of longstanding personal relations for urban surroundings where kinship and friendship are usually secondary to the pursuit of wealth.

Madam Xu, who is from central Hubei province, explained their alienating world: 'Unless they are my suppliers or my customers, I don't talk to them. That's just how it is here. I've been here for 10 years but I hardly know the guy next door.'


Saturday, November 26, 2011

Public's complaint: sizes of HDB flats are shrinking.

Housing Board's reply: sizes of households are shrinking too
But some say smaller apartments do not square with needs of a developed nation

Wednesday, November 23, 2011

How about better parents?

THERE is no question that a great teacher can make a huge difference in a student's achievement, and we need to recruit, train and reward more such teachers. But here's what some new studies are also showing: We need better parents.
By Thomas L. Friedman

Parents more focused on their children's education can also make a huge difference in a student's achievement.

How do we know? Every three years, the Organisation for Economic Cooperation and Development, or OECD, conducts exams as part of the Programme for International Student Assessment, or Pisa, which tests 15-year-olds in the world's leading industrialised nations on their reading comprehension and ability to use what they have learnt in maths and science to solve real problems - the most important skills for succeeding in college and life. America's 15-year-olds have not been distinguishing themselves in the Pisa exams compared with students in Singapore, Finland and Shanghai.

To better understand why some students thrive taking the Pisa tests and others do not, Mr Andreas Schleicher, who oversees the exams for the OECD, was encouraged by the OECD countries to look beyond the classrooms. So starting with four countries in 2006, and then adding 14 more in 2009, the Pisa team went to the parents of 5,000 students and interviewed them 'about how they raised their kids and then compared that with the test results' for each of those years, Mr Schleicher explained to me.

Two weeks ago, the Pisa team published the three main findings of its study: 'Fifteen-year-old students whose parents often read books with them during their first year of primary school show markedly higher scores in Pisa 2009 than students whose parents read with them infrequently or not at all.

'The performance advantage among students whose parents read to them in their early school years is evident regardless of the family's socioeconomic background. Parents' engagement with their 15-year-olds is strongly associated with better performance in Pisa.'

Mr Schleicher explained to me that 'just asking your child how was their school day and showing genuine interest in the learning that they are doing can have the same impact as hours of private tutoring. It is something every parent can do, no matter what their education level or social background'.

For instance, the Pisa study revealed that 'students whose parents reported that they had read a book with their child 'every day or almost every day' or 'once or twice a week' during the first year of primary school have markedly higher scores in Pisa 2009 than students whose parents reported that they had read a book with their child 'never or almost never' or only 'once or twice a month'. On average, the score difference is 25 points, the equivalent of well over half a school year'.

Yes, students from more well-to-do households are more likely to have more involved parents. 'However,' the Pisa team found, 'even when comparing students of similar socioeconomic backgrounds, those students whose parents regularly read books to them when they were in the first year of primary school score 14 points higher, on average, than students whose parents did not.'

The kind of parental involvement matters, as well. 'For example,' the Pisa study noted, 'on average, the score point difference in reading that is associated with parental involvement is largest when parents read a book with their child, when they talk about things they have done during the day, and when they tell stories to their children.'

The score point difference is smallest when parental involvement takes the form of simply playing with their children.

These Pisa findings were echoed in a recent study by the National School Boards Association's Centre for Public Education, and written up by the centre's director, Ms Patte Barth, in the latest issue of The American School Board Journal.

The study, called 'Back to School: How parent involvement affects student achievement', found something 'somewhat surprising', wrote Ms Barth: 'Parent involvement can take many forms, but only a few of them relate to higher student performance. Of those that work, parental actions that support children's learning at home are most likely to have an impact on academic achievement at school.

'Monitoring homework; making sure children get to school; rewarding their efforts and talking up the idea of going to college. These parent actions are linked to better attendance, grades, test scores, and preparation for college,' Ms Barth wrote.

'The study found that getting parents involved with their children's learning at home is a more powerful driver of achievement than parents attending PTA and school board meetings, volunteering in classrooms, participating in fund-raising, and showing up at back-to-school nights.'

To be sure, there is no substitute for a good teacher. There is nothing more valuable than great classroom instruction. But let's stop putting the whole burden on teachers. We also need better parents. Better parents can make every teacher more effective.


Tuesday, November 22, 2011

Khmer Rouge 'Killing Fields' trial begins

PHNOM PENH: Cambodians were reminded of their tragic history yesterday as the trial began of three top Khmer Rouge leaders accused of orchestrating Cambodia's 'Killing Fields' in the late 1970s.

The prosecution started its case at the United Nations-backed tribunal more than three decades after the South-east Asian country endured some of the 20th century's worst atrocities. Two-thirds of Cambodians today were not yet born when the communist group's reign of terror ended in 1979.

The defendants are old and infirm, and there are fears they will not live long enough for justice to be done.


IENG THIRITH: The most powerful woman in the Khmer Rouge, Ieng Thirith, 79, is Ieng Sary's wife and was Pol Pot's sister-in-law.
Sometimes described as the 'First Lady' of the Khmer Rouge, she acted as social affairs minister and is held responsible for the regime's drastic re-ordering of traditional Cambodian life.

Court-appointed experts told the tribunal last month that she suffers from dementia and most likely has Alzheimer's disease. Trial chamber judges recently ruled that she was unfit for trial.

NUON CHEA: 'Brother No. 2' to ruthless Khmer Rouge leader Pol Pot, ailing Nuon Chea is believed to have been a key architect of the regime's death machine.
One of the last top regime leaders to surrender in a deal with the government, Nuon Chea has acknowledged the deaths that took place under the Khmer Rouge's rule but denies he was in a position to stop the disaster that unfolded.

KHIEU SAMPHAN: A French-educated radical, Khieu Samphan served as head of state for Pol Pot's regime, and was one of its few diplomats who had contact with the outside world.
The 80-year-old claimed he was an intellectual and nationalist who knew little, until long afterwards, of the devastation wrought during the Khmer Rouge regime.

IENG SARY: Known as 'Brother No. 3', the now 86-year-old served as foreign minister under Pol Pot, who was also his brother-in-law.
Ieng Sary was found guilty of genocide in a 1979 Vietnamese-backed trial, widely regarded as a sham. He was granted a royal amnesty in 1996 but a court recently ruled that the amnesty did not bar him from further prosecution.


Yesterday, they sat side by side with their lawyers in the courtroom especially built for the tribunal: 85-year-old Nuon Chea, the Khmer Rouge's chief ideologist and No. 2 leader; 80-year-old Khieu Samphan, a former head of state; and 86-year-old Ieng Sary, the former foreign minister.

A fourth defendant, 79-year-old Ieng Thirith, was ruled unfit to stand trial last week because she has Alzheimer's disease. She is Ieng Sary's wife and was the regime's minister for social affairs.

The charges include crimes against humanity, genocide, religious persecution, homicide and torture. Their leader, Pol Pot, died in 1998 in the jungle while a prisoner of his own comrades.

An estimated 1.7 million people died of execution, starvation, exhaustion or lack of medical care as a result of the Khmer Rouge's radical policies, which essentially turned all of Cambodia into a forced labour camp as the movement attempted to create a pure agrarian socialist society.

'This is the first (trial) of the Khmer Rouge leadership responsible for enacting a series of policies that led to the deaths of nearly two million people,' said Ms Anne Heindel, legal adviser to the independent Documentation Centre of Cambodia.

'There is hope that it will help Cambodians understand why it happened, why Khmer killed Khmer, and will teach the younger generation to ensure it will never happen again,' she said.

Mr Meas Sery, 51, said he came to the hearing from his home in Prey Veng province to see for himself the faces of the defendants. He said he lost four siblings under the Khmer Rouge regime.

'I am happy to see these three leaders brought to the court. I believe that justice will come,' he said.

Ms Chea Leang, Cambodian co-prosecutor, recalled for the court the brutalities of Khmer Rouge rule, beginning on April 17, 1975, when they captured Phnom Penh, ending a bitter five-year civil war, and began the forced evacuation to the countryside of the estimated one million people who had sheltered in the capital.

Personal property was banned, religion, press and all personal freedoms abolished. The evidence, she said, would show that the regime presided over by the defendants 'was one of the most brutal and horrific in modern history'.

Some of those attending the trial provided their own vignettes of the terror.

Mr Chim Phorn, 72, was chief of a commune under the Khmer Rouge regime in Bantheay Meanchey province in the north-west. In 1977, he said, he beat a couple to death with an axe handle.

'I was ordered to kill the young couple because they fell in love without being married,' he said. 'If I did not kill them, my supervisor would have killed me, so to save my life, I had no choice but to kill them.'

When the Khmer Rouge led by Pol Pot took power in 1975, they all but sealed off the country to the outside world and sent all city dwellers to vast rural communes. Intellectuals, entrepreneurs and anyone considered a threat were imprisoned, tortured and often executed.

Economic and social disaster ensued. Vietnam, whose border provinces had suffered bloody attacks by Khmer Rouge soldiers, sponsored a resistance and invaded, ousting the Khmer Rouge in 1979 and installing a client regime.

The UN-backed tribunal, established in 2006, has tried just one case, convicting Kaing Guek Eav, the former head of the regime's notorious S-21 prison, last July and sentencing him to 35 years in prison for war crimes, crimes against humanity and other offences.

His sentence was reduced to a 19-year term due to time served and other technicalities.


Monday, November 21, 2011

Awkward questions about China's reserves

WHOSE money is it anyway?

That question, referring to China's huge foreign exchange reserves, has been the subject of much recent debate here following news that Beijing's help was being sought to beef up a rescue fund for tottering European economies.

As the world's largest holder of forex reserves, China is under international pressure to join a bailout of Europe, which hopes to double the fund to €1 trillion (S$1.75 trillion).

China's top officials have so far remained non-committal on whether they will go to Europe's aid, but that has not stopped a burgeoning debate at home centred on the country's US$3.4 trillion (S$4.4 trillion) worth of forex reserves.

The issues raised have evolved beyond relatively straightforward economic considerations of investment risks and returns, or how Chinese exports will gain from throwing a lifeline to the Europe Union, whose countries make up China's biggest trading partner.

Instead, the heated discussions among netizens and in the Chinese media have taken an increasingly political tone. Some have called for aid to be linked to conditions that give China more say on the global stage. Others question why China should help developed countries when the money could be better spent on struggling businesses or the poor at home.

At the heart of this clamour is a fundamental question that Beijing is hard-pressed to answer: To whom do China's forex reserves really belong, and whose interests should they serve?

In theory, this is a no-brainer: The money does not belong to the people. 'Forex reserves are the central bank's money and represent the country's wealth, (they are) not to be understood as the common expression of the Chinese people's 'blood and sweat money',' asserted a People's Daily editorial a month ago.

The Communist Party newspaper, which broadly reflects the government's views, said it was a misconception that forex reserves are what millions of Chinese enterprises and workers get in exchange for their toil.

Instead, it explained, the reserves rightfully belong to the central bank, which 'purchased' them from exporters by issuing yuan for the foreign currency they get in trade.

China has a controlled exchange rate and closed capital account, so Chinese businesses and people can hold only limited amounts of foreign currency.

And since the Chinese people cannot participate in currency speculation, the authorities have to do it on their behalf, the People's Daily added.

Such arguments drew derisive responses from scholars such as Geneva-based Chinese economist Xiang Lanxin.

'Despite the convoluted technical jargon employed by the central bank apologists, the logic of their argument appears crystal clear to ordinary citizens: The forex reserves are none of your business, but earning them is your duty!' he wrote in the South China Morning Post.

He further questioned if the reserves were serving the interests of corrupt officials: 'Are there kickbacks involved for purchasing foreign bonds?'

'Jiang Yong, a leading Chinese government analyst of financial securities, revealed recently he had been told that the dirty side of foreign exchange operations was much bigger than in the railway sector,' Mr Xiang added. Billions of yuan are believed to have been lost through corruption in China's huge rail projects.

While such claims are hard to prove, it is widely acknowledged that China's cash-pile is not transparently managed by the State Administration of Foreign Exchange (Safe) and the China Investment Corporation. These agencies are ranked among the world's most secretive government agencies that manage sovereign wealth.

So closely does China guard its information that it does not even subscribe to a set of specific disclosure standards for macroeconomic data that 65 countries, including much poorer states such as India and the Kyrgyz Republic, adhere to. Instead, Beijing has opted for a more general standard that is meant for International Monetary Fund (IMF) members with less developed statistical systems.

Given the opacity and its size as the world's No. 2 biggest economy, it is little wonder that China has reportedly met with resistance to its demands in exchange for helping Europe.

Beijing is said to have wanted a bigger say in decision-making in the IMF and to have a European Union arms embargo lifted. It is also said to have asked for market economy status - which would make it harder for other countries to start trade proceedings against it.

Reports of such conditions are likely to please the 24,000 readers polled by the state-linked newspaper Global Times recently. The respondents not only supported these strings attached, but they also had one more: Stop interfering in China's domestic affairs.

What is becoming clear is that China's huge forex reserves are becoming a matter of public interest, and Beijing is not immune to public pressures.

With rising social discontent and anger at official corruption and mismanagement, it is perhaps unsurprising that Safe put up a list of 16 frequently asked questions (FAQ) some months back to address criticisms that China's reserves were undiversified, losing value and fuelling inflation at home.

In a sense, Beijing is trapped. It refuses to acknowledge that it should provide greater accountability in its handling of the reserves and yet it is facing growing populist pressure on what to do with all that money.

This raises the hazard that political consideration might creep into play in the management of the funds.

Certainly, it is not easy to institute a system that ensures the reserves best serve national interests alone. But for starters, China could be more forthcoming with its figures and sign up to international standards such as the IMF's specific disclosure rules.

With tighter rules on accountability in place, officials deliberating future risky investment decisions would be forced to practise what Safe itself pledged in its July 28 FAQ: More information disclosure and transparency to 'safeguard the security and interests of China's foreign exchange reserves'.


Sunday, November 20, 2011

To save the earth, know human nature

Two years ago, the National Environment Agency (NEA) did a study of anti-littering measures to find out what really worked.
By Grace Chua

It turned out that banners reminding people not to litter - an old campaign standby - were ineffective. Now, the NEA has developed new tactics based on the study, such as using gentle social pressure in the form of Litter-Free Ambassadors, and adding bins for the convenience of people.

In environmental policy here, there is a growing recognition that understanding people's behaviour is more important than sticking dogmatically to campaigns.

And it can be just as important as new, high-tech fixes in getting people to use less fossil fuel.

At the Singapore International Energy Week held at the beginning of this month there was, for the first time, a discussion of the role of behavioural economics in energy use. It was organised by the National University of Singapore's Energy Studies Institute (ESI).

Behavioural economics is a young branch of economics that uses insights from psychology to understand why people sometimes act in seemingly irrational ways.

For instance, researchers once found people bought more cans of soup at a supermarket if the display bore the sign 'Limit: 12 per customer'.

Discussion moderator Tilak Doshi, chief economist and principal fellow at the institute, commented that renewable energy makes up such a minuscule fraction of energy mix that it will not go far towards lowering the nation's carbon footprint.

Getting individuals and businesses to be more energy efficient instead offers a 'bigger bang for the buck' in that arena.

But Singapore has long eschewed energy subsidies, saying the 'true' market cost of electricity encourages people to use less electricity. Has it reached the point where cost alone is not enough to get people to save energy?

'We've always had market pricing, but not to the point where we price externalities,' said Dr Doshi, referring to putting a price tag on carbon emissions from energy use.

'If you do that and other countries don't, then you become less competitive,' he said. That is why few countries have stepped forward to tax or price carbon emissions.

So there is a limit to the usefulness of price alone.

Stanford energy economist James Sweeney, speaking at the Energy Week discussion, outlined several ways to increase energy efficiency that rely on behavioural change.

What would save most energy, said Professor Sweeney, is getting people to buy more energy-efficient appliances in the first place.

For instance, in the United States, most people with programmable thermostats never change the default programming. So thermostats could be sold pre-set to a comfortable temperature when one is at home, and to use less or no heating at night when one is asleep and tucked under the blanket.

Then, it is getting people to use those gadgets more efficiently.

If energy usage, Prof Sweeney explained, was front and centre at the 'point of purchase' of electricity - when viewers turn on the television, for example, they might think twice about turning it on. But the electricity bill comes only at the end of the month, long after people have consumed the electricity.

There is also a social aspect to behaviour change. Yale economist Kenneth Gillingham, also part of the Energy Week panel, found that people in one California neighbourhood were more likely to install solar panels on their roofs if their neighbours also had them.

Singapore already does this - by printing on utility bills the average electricity consumption by one's housing type - but Dr Doshi suggested narrowing it down by neighbourhood or by suburb, which could spur friendly competition between direct neighbours. And the NEA is banking on such social pressure by introducing its 'Litter-Free Ambassadors' - volunteers who run personal campaigns to get friends and family not to litter.

Behavioural solutions, however, are not a magic bullet. They should be thought of as complements to traditional approaches, pointed out Dr Gillingham. One obstacle is the need to understand context. For example, in California, utility bills in some areas showed average consumption in the neighbourhood as well as the energy consumption by one's most efficient neighbours. But only liberal Democrats cut back their energy use in response - Republicans did not budge.

One explanation was that when conservatives learn that they are better than average, they become less vigilant about turning the lights off - in other words, they move closer to the norm. Some groups respond to nudges in unexpected ways, something proponents of behavioural solutions should keep in mind.

Yet such solutions need not mean more regulation, explained Copenhagen Business School researcher Lucia Reisch, if they do away with the need to legislate certain behaviour or energy standards. And they can pay for themselves in energy saved. Professor Reisch, who also studies cross-cultural communication, said these are also applicable to Asia as human nature, ways of thought and biases are similar everywhere.

But social norms can vary, she said. For example, people in the US are more likely to say that someone driving badly is a bad driver, and those in India are more likely to believe he or she is having a bad day.

Dr Doshi said Singapore has been 'nudging' its citizens into good choices for decades - one example is automatic payroll donations to self-help groups Sinda, Mendaki and the CDAC (Chinese Development Assistance Council).

So behavioural economics is worth paying attention to when it comes to encouraging people to adopt green efforts. In terms of the cost of cutting carbon emissions, it has the potential to be as effective as pouring money into the most advanced solar-energy research, which is necessary for progress but insufficient on its own.

More fine-tuned 'nudges' should be introduced and the private sector could seek to capitalise on human behaviour - for example, by selling smart meters that measure energy use up front. Also, more research should be done here and throughout Asia to find out which aspects of so-called human nature are truly universal, and which are peculiar to the US university undergraduates involved in so many such studies.

As one civil servant asked during the Energy Week panel discussion: How to convince decision-makers that these measures work? Run more tests and collect more empirical data, came the reply.

If human nature is irrational anyway, said Prof Sweeney, 'why don't we use that irrationality as a nudge to get people to accomplish things we want to accomplish'.

Values education version 2.2

The Government has a grand scheme to get values education back on track, but a similar and, by now, largely forgotten campaign in 1991 to do the same has raised questions among educators about its application, even as they welcome the new plan.
By Yen Feng

The plan integrates character education into various aspects of school, including sports and co-curricular activities.

Of those who said they supported the new programme, few recalled a similar initiative introduced 20 years ago: The White Paper on Shared Values.

Those who did could not say what the values were.

Former MPs Chng Hee Kok and Hong Hai, who had debated passionately on the subject in Parliament, were unable to recall what the row was about.

'I must confess that I have little recollection,' said Dr Hong, 68, a People's Action Party (PAP) MP from 1989 to 1991, when asked about the public debate that ensued when the paper was introduced in 1991.

The White Paper on Shared Values, which extolled the virtues of 'nation before community, society above self', was the first codified, made-for-Singaporeans set of values to promote and guide ethical behaviour.

It provided the road map for a nationwide, moral education syllabus the following year, and later, paved the way for schools to devise their own values curricula.

It was not until 2003 that it was replaced by a set of new values after discussions with school leaders and teachers in a curriculum review.

The Ministry of Education (MOE) said the new values were adopted to provide a 'more focused approach' in the light of changing social trends, in response to queries from The Sunday Times.

Thus was born 'Respect, Responsibility, Integrity, Care, Harmony, and Resilience' - qualities that underpinned subsequent values curricula, including the latest Character and Citizenship Education (CCE) programme.

The CCE programme is said to be an integrated approach combining various values education curricula over the years. Educators said it signalled a sign of changed times.

Instead of exhorting students to put nation and society before self, the CCE's aim today is for students to build personal character, before applying themselves socially.

Over the years, the changing profile of students has made less effective, 'one-way' methods of teaching values, said Mr Michael Muhunthan, vice-principal of Pioneer Junior College.

'Students now engage better in a discussion. Telling them what is right and wrong does not work well any more.'

Ms Rohanah Mohd Ali, a teacher of more than 20 years, said that with globalisation and a growing culture of consumerism, students have become more self-centred.

The focus on individuals is necessary so students can learn to better themselves, the head of English at Greenview Secondary, who is in her 40s, added.

Overwhelmingly, educators welcomed the ministry's move to update their schools' values curricula, although some remain unsure of its impact on existing programmes.

These range from small-group discussions to outdoor activities that foster values of self-reliance and kindness. Almost every school makes compulsory some form of community work, which educators say teaches compassion.

At Westgrove Primary, Mr Mark Eric Nadhan, 33, who teaches English, mathematics and science, said that apart from the school's weekly pupil well-being classes, teachers are already encouraged to find 'teachable moments' daily when values education can mesh with subject learning - a point raised at a recent CCE conference.

In his English class earlier this year, for example, Mr Nadhan said he used reports of the tsunami in Japan to teach his pupils about resilience and empathy.

Teachers with longer memories said they hoped the renewed focus on values would not go the way of its 1991 predecessor - forgotten after a period of time, or worse, during school exams.

'I'm optimistic, but I wonder how long this 'high' on morals will go on,' said education consultant Sonia Sng, 38.

Others said the CCE programme should not be seen as a signal for teachers to pull back on academic rigour in place of teaching values.

Mrs Lee Cheng Leung, 39, a part-time marketing executive and mother of two teenagers, said: 'I expect teachers to teach, not parent.

'I hope the schools will involve parents when discussing what new programmes to introduce.'


Friday, November 18, 2011

S'pore rebuts article on its Timor Leste stance

NUSA DUA (Bali): The Singapore Embassy in Jakarta yesterday rebutted an article in the Jakarta Post that said Singapore continued to reject Timor Leste's application to join Asean.

In a letter to the newspaper, the embassy said the article published yesterday was 'completely inaccurate and misinformed, particularly about Singapore's position on Timor Leste's application to join Asean'.

Deputy chief of mission Gerard Ho wrote: 'Singapore welcomes the interest of Timor Leste and other countries to join Asean.

'Singapore sees this as an indication of confidence in the centrality of Asean in the region, and its standing and credibility as an organisation, which we have always supported.'

The Jakarta Post report, headlined 'Asean to review Timor Leste's bid', said that during the grouping's foreign ministers' meeting on Wednesday, 'foreign ministers from Cambodia and Malaysia directly questioned Singapore's insistence on rejecting Timor Leste's bid'.

This is not true, Mr Ho wrote in the letter, which was seen by Singapore media.

He explained that in fact, at the Asean Coordinating Council meeting on Wednesday, 'there was consensus on Singapore's proposal to establish an Asean Coordinating Council Working Group to discuss all relevant aspects related to the application by Timor Leste, as well as its possible implications on Asean'.

Singapore Foreign Minister K. Shanmugam and his Indonesian counterpart Marty Natalegawa had also made this point in their remarks to reporters on Wednesday.

Mr Ho added that the working group will assess whether Timor Leste is able to meet the requirements of Article 6 of the Asean Charter on the admission of new members, which relates to the obligations of membership.

'Moreover, there was also consensus among the foreign ministers on how this would be presented to the public in the Chair's Statement of the 19th Asean Summit,' he said.

Asean has affirmed Timor Leste's membership bid, but is still working out the timing, as there are concerns over whether the new nation could meet the obligations of a member.

The Jakarta Post article had also named Singapore's foreign minister as Masagos Zulkifli.

Wrote Mr Ho: 'For the record, the name of Singapore's minister for foreign affairs is K. Shanmugam.'

Wednesday, November 16, 2011

The case for curbs on foreign property buyers

SOME Singaporeans are clearly worried that the growing numbers of foreigners buying private homes are driving prices ever higher - and out of the reach of some local buyers.
By Esther Teo, Property Reporter

This concern has been heightened by a fairly new trend for foreigners to buy mass-market homes, a segment in which they had previously taken little interest.

These, of course, are the same homes that many upgraders aspire to buy.

Are restrictions on foreigners' purchase of private homes, proposed by some, warranted?

First, consider the figures. In the first eight months of this year, one in three buyers of non-landed private residential properties was a non-Singaporean.

Among buyers of private homes - excluding landed property which is more regulated - the proportion of foreigners, including permanent residents (PRs), is creeping up. Last year, it was 28 per cent.

Foreigners are also increasingly turning to new developments. A recent Business Times report showed that foreigners, excluding PRs, bought 843 uncompleted private homes from developers in the third quarter, up nearly 20 per cent from 703 homes in the previous quarter. Their share of the total number of uncompleted private homes sold by developers rose from 16.3 per cent in the second quarter to 20.1 per cent in the third quarter.

Foreigners, excluding PRs, accounted for 16 per cent of all private home purchases in the first half of the year, up from 12 per cent last year.

Perhaps the biggest worry for many Singaporeans is the fact that foreigners are now encroaching on the mass-market segment.

Foreigners' share of homes sold at price tags of under $1 million - taken as a proxy definition of a mass-market home - rose to 28 per cent in the first nine months of this year. It was 19 per cent in 2009 and 22 per cent last year, according to caveats lodged with the Urban Redevelopment Authority.

At recent launches of mass-market developments such as Parc Vera in Hougang, foreigners and PRs made up about 20 per cent of sales, compared to below 10 per cent a few years ago.

In the past, foreigners largely went for expensive homes in districts nine, 10 and 11, and this had minimal impact on the average Singaporean, said Dennis Wee Group director Chris Koh. However, they are now making a splash in the suburban leasehold mass market, he noted.

Faced with such statistics, it is little wonder that some attribute the surge in private home prices to record highs - up 18 per cent last year and a further 6 per cent in the first nine months of this year - to purchases by foreigners.

Amid this concern, some experts like Chesterton Suntec International research head Colin Tan have suggested that curbs on foreigners buying private residential properties could temper the rapid rises in prices.

To a certain extent, foreigners already face curbs on property purchases. Foreigners can buy landed homes only in Sentosa Cove. If they are PRs, they may buy some types of landed housing elsewhere, but only with approval.

The sale of resale Housing Board flats is also restricted to Singaporeans and PRs who meet certain criteria.

But the market for private condominiums is largely open to foreigners, who invest in this market on a level playing field with citizens.

Those who call for curbs point out that Singapore's real estate sector is vulnerable to speculative capital flows.

With interest rates set to stay low for the next couple of years, the plentiful funds washing around the market seeking better returns could well cause price volatility if there are no curbs, they argue.

Last month, MP Christopher de Souza (Holland-Bukit Timah GRC) suggested restrictions on foreigners buying homes. He cited Australia, which has rules that limit foreigners to buying only new properties, which they can subsequently sell only to Australians.

Singapore, like other open economies such as Hong Kong and Britain, does not restrict foreigners from purchasing private condos and apartments.

Others have suggested less onerous financing-related measures such as caps on the number of mortgages foreigners can take out or reducing further for them alone the proportion of a property's value they may borrow.

Dennis Wee's Mr Koh suggested one way would be to introduce a capital gains tax for foreigners who make gains from selling private property here. Or simply keep or impose an additional sellers' stamp duty on foreigners who sell within a stipulated period, he said.

Another suggestion from Knight Frank group managing director Danny Yeo is to differentiate between those who have a stake here and those who do not.

Long-term residents, such as PRs and foreigners working here, should not be subject to restrictions as they also need a home in Singapore. But the purchases of foreigners who do not live or work here could be subject to curbs, he said.

But as National Development Minister Khaw Boon Wan noted last month, it is important to ensure that housing policy shifts do not unwittingly harm the economy and society. Rising prices also cannot be attributed solely to foreign purchases. There are many factors at play, such as low interest rates and Singapore's strong economic fundamentals, he emphasised.

In any case, foreigners are already subject to the same anti-speculation measures as locals - including a sellers' stamp duty of up to 16 per cent. This has creamed off some speculative froth, with prices moderating for the past eight consecutive quarters - inching up just 1.3 per cent in the three months to Sept 30.

Taken together, the case for more curbs on foreign purchases is mixed. A further surge in demand from foreigners can raise prices beyond the reach of locals.

At the same time, any measure that curbs demand in one segment risks cooling down the entire market, especially with a slowing economy.

There may be a case for more calibrated measures: for example, to dampen demand for mass-market homes from foreigners who do not live or work in Singapore.

But the timing and extent of any such move are critical. For now, the trend of foreigners buying into mass-market homes is certainly one that bears careful watching.


Friday, November 11, 2011

More space per person despite smaller HDB flats

If residents use good interior design and arrange their furniture to create better storage options and a feeling of space, smaller flats do not have to mean a lower quality of living, said Housing Board chief executive Cheong Koon Hean on Thursday.

The Jews: Ultra-orthodox at odds with secular

TEL AVIV: At an ice cream parlour in the ultra-orthodox Jewish neighbourhood of Mea Shearim, a sign warns men and women not to lick cones.
By Jonathan Pearlman, For The Straits Times

Still, for some of the community's more fanatical residents, the sign was not enough. The store was recently vandalised for fear that public licking - even of ice cream - promotes promiscuity.

Although it is only a short stroll from Jerusalem's main pedestrian shopping mall, there is no mistaking where the border of this ultra-orthodox, or Haredi, community lies.

Large signs on the streets leading into the neighbourhood 'beg' women not to enter if they are wearing tight-fitting dresses or 'immodest' clothes.

And anyone who attempts to drive through the neighbourhood on the Sabbath - when driving is banned under Jewish law - risks a rock thrown through their windscreen.

For most Israelis, who are largely secular, entering such neighbourhoods is like entering another world.

But it is a world that is rapidly expanding. The ultra-orthodox community has the country's highest birth rate, prompting fears of a 'demographic threat' to Israel.

There are more than 700,000 Haredim in Israel - about 9 per cent of the population - but the proportions are rapidly changing.

A University of Haifa report last November found that Haredim account for about a quarter of the country's births. By 2040, a majority of the country's high school students will be Haredim.

Haredi families have an average of seven children - treble the national average - but are not required by the government to serve in the army.

Most do not even work. The community has the country's lowest workforce participation rate: About 30 to 40 per cent of Haredi men and half of women hold jobs.

Encouraging Haredi to integrate - and work

Instead, most of the men devote their lives to studying religious scriptures at seminaries, largely funded by the government and philanthropy.

Both Israeli Finance Minister Yuval Steinitz and Bank of Israel Governor Stanley Fischer have warned that the situation is 'unsustainable'.

'We cannot have an ever-increasing proportion of the population continuing to not go to work,' Mr Fischer said last year.

Almost 60 per cent of Haredi families live below the poverty line.

The government says the cost of the community's low level of employment is about US$1.2 billion (S$1.6 billion) a year.

However, the government and several non-governmental organisations have begun working with the community to encourage more Haredi to go to college, get jobs and enlist in the army.

These have included a special army programme which allows Haredi men to study scriptures and serve separately from women soldiers. An expert on the Haredim, Professor Amiram Gonen, a professor of geography at Hebrew University, said the community has shown signs of change in the past five years.

The main catalysts, he says, have been the global financial crisis - which dried up philanthropic funding for seminaries - and the impact of the surrounding consumer society.

In its outward appearance, a Haredi neighbourhood can seem like a throwback to an 18th-century Jewish European shtetl, or village. Most men have beards, long, curling sidelocks, and wear black suits and hats. Women wear long dresses and, if married, a headscarf or wig.

But the community, as Prof Gonen says, is not as isolated as it may appear.

For a start, many Haredim do work. Even in Mea Shearim, virtually every man seems to be clutching a prayer book or speaking on a cellphone - or both.

While many households are reluctant to expose themselves to the Internet, a growing number - about 40 per cent - have computers.

The government has budgeted US$140 million over the next six years to make education more accessible for Haredim.

'It is not a barricaded fortress,' Prof Gonen said. 'Ideas come in, new norms and tastes develop.

'The images in the media are usually of the hardcore. But the fanatics are a minority. For the most part, they want a car and furniture and a new telephone and a new computer. They do consume - they are not cut off.'


Thursday, November 10, 2011

'Merkozy' calls the shots in euro zone

LONDON: Europe spent decades searching for an inspirational leader. And it finally appears to have found one: 'Merkozy'.
By Jonathan Eyal, Europe Correspondent

The term was recently coined to describe the duo of German Chancellor Angela Merkel and French President Nicolas Sarkozy who effectively run the continent, disciplining misbehaving nations while rewarding those deemed good pupils.

The fate of Greece now rests entirely in Merkozy's hands: The German and French leaders put together the financial bailout plan for that stricken country, and when the Greek Prime Minister George Papandreou demurred, he was told that he could be kicked out of the European Union altogether.


To some extent, the emergence of the Merkozy couple is unsurprising. For France and Germany founded the European Union and have ruled it ever since.

Italian Prime Minister Silvio Berlusconi also discovered the power of Europe's ruling couple. With only a few hours' notice, he was recently summoned to appear before Merkozy, and ordered to cut his government's budget or face bankruptcy.

Mr Berlusconi complied, but the episode finished his political career: The Italian leader who survived numerous domestic scandals over his 'bunga-bunga' parties proved no match for Dr Merkel and Mr Sarkozy.

Even those who are outside the euro currency zone have felt Merkozy's wrath: British Prime Minister David Cameron was told by Mr Sarkozy to 'shut up' and stop complaining about the continent's financial condition. The French and German leaders no longer bother with diplomatic niceties.

To some extent, the emergence of the Merkozy couple is unsurprising. For France and Germany founded the EU and have ruled it ever since. The two leaders routinely meet before each European summit to coordinate their policies, and then present them to the other member states as accomplished facts.

As Europe's biggest economies, France and Germany now contribute about €370 billion (S$647 billion) to the bailout fund created to save the continent from disaster, more than all the other European countries combined. So, Mr Sarkozy and Dr Merkel are entitled to decide what is done with their money.

Besides, 'the euro area institutions were not designed for crisis management', points out a senior EU official; the Merkel-Sarkozy tandem is the only structure which works.

Still, Merkozy's grip over Europe is not as solid as it seems.

To start with, the personalities of the two leaders could not be more different. Dr Merkel is methodical and well-briefed, while Mr Sarkozy is an unpredictable improviser of the kind ordinary Germans find infuriating.

As the daughter of a Lutheran pastor, Dr Merkel does not appreciate Mr Sarkozy's 'Latin lover' behaviour, complete with frequent hugs and kisses. And Mr Sarkozy often jokes about Dr Merkel's demeanour: He recently giggled about the German leader's inability to lose weight. The link between the two is a political marriage of convenience, rather than a meeting of minds.

And despite the appearance of equality, Mr Sarkozy remains the junior partner. For the French economy is facing the same excessive budget deficits and high debts which plague the rest of Europe.

This week, Mr Sarkozy was forced to introduce new austerity measures in an attempt to maintain France's triple-A status with international credit-rating agencies, without which France will be shut out of financial markets. So, Mr Sarkozy is clinging to Dr Merkel's coat-tails out of desperation.

And Dr Merkel is happy to pretend not to notice, because this serves Germany's interests. As Europe's paymaster, Dr Merkel knows that she is admired and dreaded in equal measure.

By sharing power with France, she protects herself from accusations of dominating other European nations. Mr Sarkozy does the unpleasant talking, while Dr Merkel does the sums.

Still, the backlash against the Merkozy duo is rising. Mr Anibal Cavaco Silva, the President of Portugal, a country which had to be bailed out, recently expressed his public concern over the emergence of a 'board of directors, which treats European institutions with disdain'. Meanwhile, smaller but rich countries, such as Austria, Finland or the Netherlands, are angry that France and Germany no longer consult them, but still demand their cash.

Dr Merkel and Mr Sarkozy have tried to answer this criticism by co-opting into their magic circle a handful of other decision makers. The recently established 'Frankfurt Group' includes the bosses of the International Monetary Fund and the European Central Bank, as well as a handful of top EU officials. The group met no fewer than four times on the margins of the recent G-20 summit, including once with US President Barack Obama.

But other European countries dismiss the Frankfurt Group as just another Franco-German directorate, and remain determined to oppose it. On Monday, finance ministers of the 10 EU countries outside the euro zone organised their own separate gathering.

'This is not a club, just an informal meeting,' said Swedish Finance Minister Anders Borg. However, the implicit message was clear: France and Germany will not be allowed to act alone.

The real danger is that, in an effort to save Europe, Dr Merkel and Mr Sarkozy could tear up the continent's existing political arrangements without putting anything else in their place.

And, to make matters worse, they may also fail to rescue the euro.


Monday, November 07, 2011

Chinese students cheat to get into US colleges

NEWARK: Dozens of new students crowded into a lobby of the University of Delaware's student centre at the start of the school year. Many were stylishly attired in distressed jeans and brightly coloured sneakers; half tapped away silently on smartphones while the rest engaged in boisterous conversations.

All but one - a lost-looking soul from Colombia - were from China.

Among them was Mr Fan Yisu, whose flight from Shanghai had arrived six hours earlier. Too excited to sleep, he had stayed up all night waiting for orientation at the English Language Institute to begin. Like nearly all the Chinese students at Delaware, he was conditionally admitted, and can begin taking classes only after he completes an English programme.


90 per cent of Chinese applicants submit false recommendations, 70 per cent have other people write their essays, 50 per cent forge high school transcripts and 10 per cent list academic awards and other achievements they did not receive, says Zinch China, a consulting company that advises US colleges and universities about China.

He plans to major in finance, he said, and return home to work for his father's construction company after graduating. He had chosen to attend college more than 10,000km from home, he added, because 'the Americans, their education is very good'.

That opinion is widely shared in China, which is partly why the number of Chinese undergraduates in the United States has tripled in just three years to 40,000 - making them the largest group of foreign students at US colleges.

While other countries, such as South Korea and India, have for many years sent high numbers of undergraduates to the United States, it is the sudden and startling uptick in applicants from China that has caused a stir at universities.

It is also a trend that many countries are seeing, as rising incomes allow more Chinese to seek an overseas education. In Singapore, the 50,000 or so Chinese students at all educational levels form one of the largest groups of foreign students.

At Delaware, the growth has been stark. In 2007, there were just eight Chinese students; this year, there are 517.

At first glance, the trend is a boon for colleges and students alike. While China's rapidly expanding middle class can now afford to go overseas, they are also a godsend for universities that have faced sharp budget cuts in recent years.

On closer inspection, however, it can be a tricky fit for both.

Colleges eager to bolster their diversity and expand their international appeal have rushed to recruit in China, where fierce competition for seats at local universities and an aggressive admissions-agent industry feed a frenzy to land spots on US campuses.

But college officials and consultants say they are seeing widespread fabrication on applications, whether that means a personal essay written by an agent or an English proficiency score that does not jibe with a student's speaking ability.

US colleges, new to the Chinese market, struggle to distinguish between good applicants and those who are too good to be true.

Ms Tang Wenting, a junior majoring in management and international business, for instance, had very poor English when she first applied to Delaware.

An agency helped her with her application, charging her US$4,000 (S$5,060) for it. Because her English was not good enough for her to write the admissions essay, staff at the agency asked her questions about herself in Chinese and produced an essay.

Now that she can write in English herself, she does not think much of what they wrote. But it served its purpose: She was admitted, and spent six months in the English-language programme before beginning freshman classes.

As for allowing an agent to write her essay, she sees that decision in pragmatic terms: 'At that time, my English not better as now.'

Zinch China, a consulting company that advises US colleges and universities about China, interviewed 250 US-bound Beijing high school students, their parents, agents and admissions consultants.

It concluded that 90 per cent of Chinese applicants submit false recommendations, 70 per cent have other people write their essays, 50 per cent forge high school transcripts, and 10 per cent list academic awards and other achievements they did not receive.

The 'tide of application fraud', it predicted in a report, will only worsen as more students go to America.

At an orientation in September, the director of the English Language Institute at Delaware's Newark campus, Dr Scott Stevens, mixed compliments and warnings as he reminded his audience of primarily Chinese students not to cheat. 'You are all very intelligent,' he said. 'Use that intelligence to write your own papers.'

But he was candid about the challenges Delaware is facing as the population of Chinese students grows - and confronting plagiarism is near the top of the list.

Dr Stevens told of how one student memorised four Wikipedia entries so that he could regurgitate whichever one seemed most appropriate for an essay - an impressive, if misguided, feat.

For those on the ground, there is deepening concern that US colleges have entered China without truly understanding it. For officials like Dr Stevens, who has been dealing with international students for nearly three decades, Chinese undergraduates are like a code he is still trying to decipher.

'How can we reach them? How can we get them to engage? That,' he said, 'is something that keeps me up at night.'


Friday, November 04, 2011

Warning over 'crisis of faith' in China

BEIJING: China's top official paper yesterday warned that the government is facing 'a crisis of faith' among its people, and urged local officials to win trust in the face of rising discontent.

Anger over forced demolitions and corruption has led to a daily rash of 'mass incidents', an official euphemism for protests, worrying officials determined to defend one-party rule and ensure a smooth transition of power to a younger generation of leaders.

The call came in an editorial of the People's Daily, the official paper of the ruling Communist Party. While such an editorial does not amount to a statement of government policy, it reflects official concern.



'If the mistrust deepens, it will bring a negative impact to the development, harmony and stability of society. A ruling party's governing position and governing power, fundamentally speaking, come from the people.'

A People's Daily editorial

'We must pay attention to the 'crisis of faith' in the relationship between grassroots cadres and the people,' the editorial said.

'If the mistrust deepens, it will bring a negative impact to the development, harmony and stability of society.

'A ruling party's governing position and governing power, fundamentally speaking, come from the people.'

China's leaders have pinned the legitimacy of one-party rule on delivering quick economic growth and higher standards of living that spread more widely among the population.

But the Communist Party has not succeeded in tackling problems that have long plagued the nation, including rampant corruption and a yawning income gap that could doom its efforts to create a more 'harmonious society'.

In a speech in July to mark the party's 90th birthday, Chinese President Hu Jintao said the anti-graft fight was the key to 'winning or losing public support and the life or death of the party'.

The central government announced on Wednesday that all civil servants will have to undergo at least six hours of ethics teaching by the end of 2015.

Topics to be taught to China's nearly 10 million civil servants will include the 'conscientious discharge of duties' and the 'justness and honesty' of government employees, the State Administration of Civil Service said in a statement.

Ethical standards will be a factor in the selection, assessment and supervision of government employees, it added.

Apart from corruption, rising land prices form another top source of public discontent. The high prices have given rise to patronage networks of officials and businessmen eager to procure more farmland for development.

A recent poll found that rural land grab disputes are hitting new highs in China, and spreading to the country's undeveloped west.

The poll, involving 1,700 households in six provinces, found disputes over land acquisitions had reached a new peak amid rampant development across the country, and was a leading cause of rural clashes, according to Outlook Weekly, a magazine run by Xinhua, China's state-run news agency.

In September, thousands of villagers in the southern Chinese region of Lufeng rioted and ransacked government offices, in a major flare-up of violence over brazen land requisitions.

Official statistics on China's rural conflicts are hard to come by, but a former deputy editor-in- chief of the People's Daily said they consistently numbered above 90,000 a year from 2007 to 2009.

Meanwhile, a 65-year-old grandmother who organised a protest in Shanghai demanding better benefits for retirees has been sentenced to 31/2 years' jail for disturbing public order, a relative and court official said yesterday.

Zhang Weimin is the leader of a group of Shanghai residents - now retired - who were sent to the far western region of Xinjiang in the 1960s to work, as part of a policy of dispatching so-called 'educated youth' to rural areas.


A multifaceted look at ageing issues

IF BOOKS on serious subjects like health care and dying can ever be said to be a treat, this is one of them.
By Chua Mui Hoong, Review Editor
Singapore's Ageing Population: Managing Healthcare And End-Of-Life Decisions.
Edited by Chan Wing Cheong.
Routledge Contemporary Southeast Asia Series. 222 pages, $140.

It is an intellectual treat for the sheer range of perspectives on ageing: from the medical, sociological, legal and anthropological. It also scores in offering a macro- and micro-perspective, a rare feat for academic books. The 19 contributors to the book, most of whom based their chapters on papers presented at a conference on ageing earlier, come from different academic disciplines, and quite a few are policy practitioners. So there are insights into the flesh-and-blood experience of ageing, thanks to sociologists' first-hand interviews, and policy suggestions from researchers.

One chapter describes Singapore's demographic changes in the context of an ageing Asia-Pacific, offering a macro view of ageing. (See other story.)

Yet another zooms in in some detail on the experience of ageing among men in Singapore, using its ground-up perspective to offer suggestions on ways to help elderly men age in place: go beyond health-care needs to provide meals, social support and daily assistance.

Another chapter - by Chan Wing Cheong, an associate professor at the National University of Singapore with an interest in elder law, who is also the editor of the volume - gives an insight into elder abuse victims. This is based on a study of 89 cases at TRANS SAFE Centre, a voluntary welfare organisation that handles elder abuse. This study does a useful service in confirming or overturning some commonly held assumptions about elder abuse: It is true that elderly women are more prone to being abused than elderly men. And among the different types of abuse, sons are more likely to use neglect as a form of elder abuse than other forms such as physical abuse, psychological abuse and financial abuse.

The issue of a society's rapid ageing is invariably bound up with health financing issues. The introduction of the book rightly zooms in on this Gordian knot on health financing thus: 'How can long-term medical expenses be dealt with?'

Perhaps because there are no health economists among the contributors, this important issue is not sufficiently discussed in this book. (Those who want a more thorough discussion of health-care financing can turn to another book, Social Policy In An Ageing Society: Age And Health In Singapore, by David Reisman, a professor of economics at the Nanyang Technological University, published in 2009.)

But what Chan's book on ageing lacks in economic insight, it makes up for in conceptual interest, especially when it comes to the legal and intellectual issues of end-of-life matters.

When is a person dead - when the brain has no decipherable function or must the heart also stop? How does a society represent the interests of the person at the end of life, when that person is no longer mentally capable? How much authority should a proxy carer be given to make decisions? On what basis should a proxy carer make such decisions?

Since a patient has autonomy to refuse treatment, does he also have a right to determine time and manner of death?

These difficult ethical and moral dilemmas are dealt with excellently in the last four chapters that illumine the issues with an incisive presentation of concepts.

Consider: how does one begin to make a decision for an incapacitated person? Tracey Evans Chan, an assistant professor of law at the National University of Singapore, guides the reader through the legal morass. Three usual standards apply. First, 'advance decision', which is when a patient has already indicated his or her wishes, for example via an advance medical directive or verbal instructions. Second is 'substituted judgment', which is based on one's best assessment of what the person would have chosen were he or she mentally competent. The third is 'best interests', which is making a decision based on what one thinks is in the best interest of the infirm patient.

It is interesting to know that 'the first finds clear support in the common law generally, while the second has widest support among the various US states but has been rejected by the highest courts in Britain and Canada in favour of the third'.

What of Singapore? What direction will the legal and philosophical debate here take? The chapter gives a lucid assessment of existing legal frameworks and points out their limits.

One of the most ground-breaking - and radical - proposals in the book comes towards the end, when two contributors bravely take on the sensitive issue of physician-assisted suicide (euthanasia), look at different legal models and even draft a proposed legal framework for such a law in Singapore.

This book does not claim to offer clear answers on how a society should best prepare for a rapidly ageing population. But the intelligent and varied views in this slim 222-page volume will reward both the layman and the specialist reader.

The book can be ordered online from the publisher's website http://www.routledge.com/books/details/9780415609753/). It is also available at the National University of Singapore Library and the National Library.

Thursday, November 03, 2011

Wen recalls Mao's persecution

BEIJING: Chinese Premier Wen Jiabao said his family was 'constantly attacked' in Maoist political campaigns that convulsed the country over past decades, giving a rare glimpse into his tumultuous past as he prepares to leave office.

China's wary leaders rarely talk about their past. But Mr Wen opened up in comments to students and teachers that were published in the China Education News yesterday, saying his father was dismissed as a teacher and sent to tend pigs.

'After I went to high school and university, my family suffered constant attacks in the successive political campaigns,' Mr Wen told the audience at Nankai Middle School, his alma mater in the northern port city of Tianjin near Beijing.

Mr Wen, 69, has stood out among China's ruling Communist Party leaders as the most persistent advocate of measured political relaxation under party control, and his published comments to the students perhaps help explain why.

Mr Wen comes from a family of teachers, and during Mao Zedong's era of fervent communism, the party attacked and demoted citizens deemed to have bad 'class' backgrounds or suspect pasts. Mr Wen's father and grandfather were among the victims. 'In 1960, my father was also investigated for so-called historical problems. He could no longer teach and was sent to work on a farm on the outskirts of the city to tend pigs, and then later worked in a library,' Mr Wen told the students when he visited the school on Oct 25, according to the transcript in the Chinese-language paper.

Surviving files about Mr Wen's grandfather from the school where he taught showed he constantly had to write 'self-criticisms' before he died of cerebral haemorrhage in 1960, Mr Wen said. 'I was the one who carried him on my back to the hospital.'

His grandfather's files 'are filled with one self-criticism after another, written in small, neat characters', he added.

Mr Wen retires as premier in early 2013 as part of a generational leadership shift that begins late next year.

As he prepares to leave power, he has made a habit of calling much more forthrightly for political reform than more cautious comrades in the Communist Party elite. But his proposals have remained vague, and Mr Wen lacks the backing from other leaders needed to act on such ideas.

To sceptics, Mr Wen's hazy words are vanity, burnishing his reputation without venturing to secure real change. More sympathetic observers have said he is defending a moderate agenda that could gain ground after the leadership transition.

'I come from the people, and had a hard childhood, so I feel sympathy for all poor people and have given all I can for the sake of their happiness,' he said.

'My childhood was spent in war and hardship, and the poverty, turmoil and famine left an ineradicable imprint on my young soul.'

China has made huge economic strides, he said, but remains beset by imbalances, inequality and corruption. 'Income distribution is unfair, and in some areas social conflicts are very sharp, with mass incidents occurring.'

'Mass incidents' is the government's euphemism for protests, demonstrations and strikes.

'If a government ignores the public and people's well-being, it ignores its foundations,' he said.

'Fairness and justice are the pillars of society, and if they are lost, then the great house of society will collapse.'


Wednesday, November 02, 2011

Not all inequality is created equal

Income gap a problem but bigger issue is divide between grads and non-grads

WE LIVE in a polarising society, so perhaps it's inevitable that our experience of inequality should be polarised, too. In the first place, there is what you might call Blue Inequality. This is the kind experienced in New York City, Los Angeles, Boston, San Francisco, Seattle, Dallas, Houston and the District of Columbia. In these places, you see the top 1 per cent of earners zooming upwards, amassing more income and wealth. The economists Jon Bakija, Adam Cole and Bradley Heim have done the most authoritative research on who these top 1 per cent are.
By David Brooks

Roughly 31 per cent started or manage non-financial businesses. About 16 per cent are doctors, 14 per cent are in finance, 8 per cent are lawyers, 5 per cent are engineers and about 2 per cent are in sports, entertainment or the media.

If you live in or around these big cities, you see stores and entire neighbourhoods catering to the top 1 per cent. You see a shift in social norms. Up until 1970 or so, a chief executive would have been embarrassed to take home more than US$20 million (S$25 million). But now there is no shame, and top compensation zooms upwards.

You also see the superstar effect that economists have noticed in the income data. Within each profession, the top performers are now paid much better than the merely good or average performers.

If you live in these big cities, you see people similar to yourself, who may have gone to the same college, who are earning much more while benefiting from low tax rates, wielding disproportionate political power, gaining in prestige and contributing seemingly little to the social good. That is the experience of Blue Inequality.

Then there is what you might call Red Inequality. This is the kind experienced in Scranton, Des Moines, Naperville, Macon, Fresno, and almost everywhere else. In these places, the crucial inequality is not between the top 1 per cent and the bottom 99 per cent. It's between those with a college degree and those without. Over the past several decades, the economic benefits of education have steadily risen. In 1979, the average college graduate made 38 per cent more than the average high school graduate, according to the Federal Reserve chairman, Ben Bernanke. Now the average college graduate makes more than 75 per cent more.

Moreover, college graduates have become good at passing down advantages to their children. If you are born with parents who are college graduates, your odds of getting through college are excellent. If you are born to high school grads, your odds are terrible.

In fact, the income differentials understate the chasm between college and high school grads. In the 1970s, high school and college grads had very similar family structures. Today, college grads are much more likely to get married, they are much less likely to get divorced and they are much, much less likely to have a child out of wedlock.

Today, college grads are much less likely to smoke than high school grads, they are less likely to be obese, they are more likely to be active in their communities, they have much more social trust, they speak many more words to their children at home.

Some research suggests that college grads have much bigger friendship networks than high school grads. The social divide is even starker than the income divide.

These two forms of inequality exist in modern America. They are related but different. Over the past few months, attention has shifted almost exclusively to Blue Inequality.

That's because the protesters and media people who cover them tend to live in or near the big cities, where the top 1 per cent is so evident. That's because the liberal arts majors like to express their disdain for the shallow business and finance majors who make all the money. That's because it is easier to talk about the inequality of stock options than it is to talk about inequalities of family structure, child-rearing patterns and educational attainment. That's because many people are wedded to the notion that our problems are caused by an oppressive privileged class that perpetually keeps its boot stomped on the neck of the common man.

But the fact is that Red Inequality is much more important. The zooming wealth of the top 1 per cent is a problem, but it's not nearly as big a problem as the tens of millions of Americans who have dropped out of high school or college. It's not nearly as big a problem as the 40 per cent of children who are born out of wedlock. It's not nearly as big a problem as the nation's stagnant human capital, its stagnant social mobility and the disorganised social fabric for the bottom 50 per cent.

If your ultimate goal is to reduce inequality, then you should be furious at the doctors, bankers and CEOs. If your goal is to expand opportunity, then you have a much bigger and different agenda.


Half of rich Chinese want to emigrate

SHANGHAI: Nearly half of Chinese who have assets worth more than 10 million yuan (S$2 million) are considering emigration, mainly to seek better opportunities for their children's education, results of a new survey showed.

According to the survey released at the weekend by the Hurun Report and Bank of China, 46 per cent of the 980 millionaires surveyed are considering leaving China.

Fourteen per cent have either emigrated or applied, said the survey, which was done in 18 Chinese cities from May to September this year.

Some 60 per cent want to leave to seek a better education for their children. Many also cited concerns about the security of their assets in China.

One-third of the people surveyed have engaged in 'investment immigration', which allows a person to emigrate after he agrees to first invest a certain amount of money in the host country. Some countries offer residency to foreign citizens who are prepared to invest large sums.

After education, protecting assets and retirement, other reasons listed for wanting to emigrate included the lack of a sufficient legal framework on the mainland leading to too many grey areas, a worsening environment for investment, and rising living costs and taxation.

The survey did not list the most popular destinations for China's rich emigrants, though state news agency Xinhua said last month that Canada and Australia are the two most favoured.

The Hurun survey said the average respondent was 42 years old and worth over 60 million yuan.

China now has 271 US-dollar-billionaires, according to Hurun's 2011 rich list, up from 189 last year, despite the global economic crisis.

The latest survey said that 960,000 people in China are now worth more than 10 million yuan, up by 9.7 per cent from last year.

More than 30 years of booming economic growth have allowed some Chinese to build up vast fortunes. Many of the country's richest have made their money in the construction and property sectors, as well as in a growing domestic retail market.

A woman surnamed Luo, who has emigrated to Britain, said: 'To buy a house in Beijing, the price now is the same as that abroad, but you enjoy no other benefits.

'To live abroad, the cost is not higher, but you definitely enjoy it more,' she was quoted as saying in a recent issue of popular magazine Lifeweek.

The survey was greeted with envy online. Many users on microblogging website Sina Weibo said they would have done the same if they were rich.

'If you can flee, flee immediately,' a microblogger using the name 'Jiang Langzi' said.