2011/01/22

Obama vows to 'unlock the productivity' of Americans

WASHINGTON, January 22, 2011 (AFP) - US President Barack Obama expressed his determination Saturday to "unlock the productivity" of American workers to  make the country more competitive in a technology-driven economy.

"I know we can out-compete any other nation on Earth," Obama said in his weekly radio address.

"We just have to make sure we're doing everything we can to unlock the productivity of American workers, unleash the ingenuity of American businesses, and harness the dynamism of America's economy," he added.

The president also referred to a raft of trade deals worth $45 billion the United States and China announced Wednesday as the two powers tried to narrow disputes by tethering their economic fortunes.

Lauding 70 trade agreements with exporters in 12 US states, presidents  Obama and his Chinese counterpart, Hu Jintao, edged away from the fevered rhetoric of recent months to stress mutual dependency, despite lingering tensions.

Obama expressed hope for a renewal of relations, casting aside "old stereotypes" and allowing US firms to more easily benefit from China's breakneck development.

In Saturday's address, Obama said that as a result of deals completed this past week, US exports to China would increase by more than $45 billion, and China's investments in America by several billion dollars.

"Most important, these deals will support some 235,000 American jobs. And that includes a lot of manufacturing jobs," the US president stressed.

Chinese businesses have descended on the United States to coincide with Hu's visit, inking agreements with US titans Alcoa, General Electric, Honeywell, Westinghouse and Caterpillar among others.

The deals span sectors as diverse as agriculture, gasification, railways and hybrid buses.
"These will inject fresh momentum into our bilateral cooperation," Hu said.

The meeting did however touch on US complaints that China does not adequately protect copyright and unfairly discriminates against foreign firms in competitions for lucrative government contracts.

Obama said the leaders had made some toward resolving each of those issues.

Hu was said to have agreed to make it easier for US firms to tap procurement contracts issued outside the central government, a market worth more than $88 billion dollars each year.

On Thursday, Hu also urged the United States to ease restrictions on high-tech exports to China.

"China wishes to work with the United States to fully tap our cooperation potential in fiscal, financial, energy, environmental, infrastructure development and other fields," the Chinese leader said in a speech to political and business leaders in Chicago.

Obama also praised a recently concluded trade agreement with South Korea, saying that will support more than 70,000 American jobs.

In December, President Obama's administration sealed a deal to end 95 percent of tariffs between the United States and South Korea, revising a 2007 pact negotiated under president George W. Bush that went nowhere in Congress.

The free trade agreement enjoys support from senior lawmakers, with revisions on auto tariffs in the new text winning over automaker Ford and the United Auto Workers union -- former staunch opponents.

But the AFL-CIO, the largest US labor federation and usually a staunch ally of Obama's Democratic Party, opposes the deal which it says will not fundamentally protect workers in troubled economic times.

Obama stressed the need of making everything that is necessary to uphold "America's global economic leadership."

"Leading the world in innovation. Opening new markets to American products. That's how we'll create jobs today," the president pointed out. "That's how we'll make America more competitive tomorrow. And that's how we'll win the future."

Japanese rocket puts cargo into orbit

TOKYO, January 22, 2011 (AFP) - A Japanese rocket successfully took an unmanned cargo transporter to the International Space Station into orbit on Saturday, Japan's space agency said.

The H-IIB rocket took off from the Tanegashima space centre in southern Japan on schedule at 2:37 pm (0537 GMT). Around 15 minutes later it put the cargo unit into a planned orbit, according to the Japan Aerospace Exploration Agency (JAXA).

The "Kounotori (stork) 2" space vehicle is carrying five tonnes of supplies, including food, water and experimental tools for astronauts.

It is scheduled to reach the space station on Thursday ahead of the final launch of the space shuttle Discovery on February 24.

It was Japan's second cargo transfer mission to the ISS, where Japanese astronaut Satoshi Furukawa is scheduled to stay for six months from late May.

The rocket was originally due to be launched on Thursday but was delayed by bad weather.

Japan culls 10,000 chickens to contain bird flu

TOKYO, January 22, 2011 (AFP) - Japan began slaughtering some 10,000 chickens Saturday at a poultry farm in western Miyazaki prefecture in a bid to contain an outbreak of bird flu, the local government said.

Officials in the prefecture, 900 kilometres (560 miles) southwest of Tokyo, said 36 chickens were found dead on Friday at the poultry farm.

Preliminary tests confirmed that six of the birds had died of the H5 subtype of the avian flu virus, the officials said.

In an effort to prevent a larger outbreak, the local government decided to slaughter all the chickens at the farm while setting up 20 checkpoints for disinfection and banned any movement of chickens within 10 kilometres.

It was the first bird flu outbreak since 2007 in Miyazaki, where a foot-and-mouth outbreak also forced the slaughter of almost 300,000 farm animals last year.

In Tokyo, Prime Minister Naoto Kan set up a task force Saturday morning to "promptly" introduce necessary measures to contain the bird flu outbreak, officials said.

Google looks to its next decade

WASHINGTON, January 22, 2011 (AFP) - Google, which prides itself on helping people navigate the Internet, is facing a tangled Web as it weaves its own future.

While more profitable than ever -- with nearly $30 billion in revenue last year -- Google is under pressure from new rivals such as Facebook and Twitter for the attention of Web surfers, advertising dollars and engineering talent.

In naming co-founder Larry Page, 37, to be chief executive, analysts said Google is seeking to return to its startup roots and ensure its place amid a constantly evolving Internet landscape.

Outgoing CEO Eric Schmidt, 55, was brought in to run Google in 2001, when it was battling other, now defunct search engines, while Page and fellow co-founder Sergey Brin were just a few years removed from Stanford University.

Schmidt, who has jokingly referred to himself as the "adult supervision" at Google, is widely credited with helping build the company into the technology titan it is today alongside the likes of Apple and Microsoft.

And while Schmidt is expected to remain an influential voice at Google as executive chairman, the Mountain View, California-based company is turning to Page to stay ahead of its competitors over the next decade.

BGC Partners analyst Colin Gillis said Google experienced tremendous growth under Schmidt, becoming a search and advertising powerhouse, but the company also arguably experienced a number of missteps and missed opportunities.

"A case can also be made that the company has not built any new material revenue streams, was late to building for the mobile market, has no effective social solutions, overbuilt its headcount and placed itself in the crosshairs of government regulators," Gillis said.

Danny Sullivan, editor-in-chief of technology blog SearchEngineLand.com, said Google's biggest challenges now are to "prove that they've got their Mojo back and that nobody needs to fear them."

"You have investors and others saying 'Gosh, Facebook seems to be doing so well. Why aren't you the hot new thing?'" Sullivan said.

"And nobody's made a movie about Google yet," he added in a reference to "The Social Network," the Oscar-nominated film about the birth of Facebook.

Sullivan said "social networking in particular is seen as hot and Google is seen as a company that ought to be doing something there."

At the same time, he said, Google's critics "neglect the fact that they actually have successful products and quite a range of them."

The other major issue for Google is "they are engendering a lot of fear in various places: people wondering about privacy, whether they're favoring themselves... governments investigating them for anti-trust claims," Sullivan added.

Wedbush Securities social media analyst Lou Kerner dismissed claims Google does not have a social strategy and said the company is well-placed in the booming mobile telephone market with its Android mobile operating system.

"Facebook is the world's biggest social network and Google is not going to come up with another social network," he said. "But they already have a massive social presence.

"YouTube is the third biggest website in the world and massively social... Email is still the primary social communication media and Google is the fastest growing email provider in the world.

"And they've got the largest blogging platform in the world so they are already a massive player in social," he added.

In a conference call with financial analysts after the surprise announcement that Page would replace Schmidt in April, co-founder Brin indicated the company would be putting more effort into the social arena.

"We've touched just one percent of the capabilities that could be deployed in that realm," said Brin, who will be in charge of strategic projects and new products in the new management structure.

BGC's Gillis said Google has had scant success with products it has developed on its own, such as Google Buzz, Google Wave and Google TV but acquisitions such as Android, YouTube and DoubleClick have flourished.

He said he will be looking to see whether Page, the CEO, "can better increase the integration of Google's technology with business models to generate new revenue."

Wedbush's Kerner said the new management structure could prove more nimble than the troika of Schmidt, Page and Brin, which has been in place for the last decade.

"What I do think Facebook has shown Google is that they're moving too slow," Kerner said. "Facebook is moving at the speed of light and Google isn't.

"Having three people running the company, making the decisions, was slowing it down," he added.

China to US: Boost exports to trim surplus

CHICAGO, January 21, 2011 (AFP) - China said Friday it would welcome greater US exports to the fast-growing Asian economy, rejecting blame for its large and politically sensitive trade surplus over the United States.

As President Hu Jintao wound up a state visit to the United States, Chinese officials appeared to try to shift the focus away from US allegations of currency manipulation and instead stressed business promotion.

"Our two countries need to sit down and work it out so there won't be such a huge trade deficit and trade surplus," Chinese Commerce Minister Chen Deming told a business conference in Chicago.

Chen voiced hope that US exports to China would more than double to $200 billion by 2015 as part of $500 billion in overall trade.

"We still have work to do to get to that $200 billion," Chen said.

The latest US data showed that the US deficit with China in 2010 was likely to top the 2008 record of $268.0 billion, even though the overall US trade gap shrank in November.

US Commerce Secretary Gary Locke, addressing the same conference, said that impediments were holding back US businesses that operate in China including government preferences for domestic firms and theft of intellectual property.

Chen, however, said China had its own complaints and pressed the case for the United States to ease restrictions on exports of its advanced technology.

"We hope the US can eliminate discriminatory practices against high-tech products into China," Chen said.

Wang Chao, the vice minister of commerce, said China was shifting to an economy based on domestic consumption rather than exports, in line with exhortations by the United States and other trading partners.

"China never pursued a trade surplus. A long time ago China began to pursue home-grown demand," he said.

US policymakers, led by members of Congress, have charged that China has kept its currency artificially low so as to boost its manufacturing sector and flood world markets with cheap goods.

Hu, in a speech in Washington, hit back by saying that US consumers have saved $600 billion in the past decade thanks to "quality yet inexpensive Chinese products."

Facebook raises $1.5 billion, valued at $50 billion

SAN FRANCISCO, January 21, 2011 (AFP) - Facebook announced Friday that it had raised $1.5 billion from investors in a private share offering that valued the booming social network at approximately $50 billion.

"Our business continues to perform well, and we are pleased to be able to bolster our cash position with this new financing," Facebook chief financial officer David Ebersman said in a statement.

"With this investment completed, we now have greater financial flexibility to explore whatever opportunities lie ahead."

Facebook said US investment bank Goldman Sachs completed an oversubscribed offering to its non-US clients in a fund that invested $1 billion in Facebook Class A common stock.

Russia's Digital Sky Technologies, The Goldman Sachs Group, Inc., and funds managed by Goldman Sachs meanwhile invested $500 million in Facebook Class A common stock at the same $50 billion valuation.

Facebook also said it expected to surpass the ceiling of 500 shareholders sometime this year and would start filing public financial reports no later than April 30, 2012.

US Securities and Exchange Commission (SEC) rules require firms with 500 or more shareholders of record in a given type of stock to publicly disclose certain financial information.

Facebook, the world's top social network with nearly 600 million members, said it had "no immediate plans" for the newly raised funds, indicating it "will continue investing to build and expand its operations."

Earlier this week, Goldman Sachs, citing "intense media coverage," said it was excluding US clients from the private offering of shares in Facebook.

"Goldman Sachs concluded that the level of media attention might not be consistent with the proper completion of a US private placement under US law," it said.

US securities law bars public promotion of private offerings and the Facebook deal reportedly attracted the SEC's attention.

Facebook has been in the spotlight since US media revealed earlier this month that Goldman had invested $450 million in the company, alongside a $50 million investment by Digital Sky Technologies.

With this fresh investment, Facebook has a bigger valuation than companies like Boeing or Time Warner.

Yet its annual revenue, primarily based on advertising, is estimated at $2 billion, compared with Boeing's $64.62 billion and Time Warner's $26.5 billion.

Facebook co-founder Mark Zuckerberg has so far resisted pressure to launch an initial public offering of stock in the Palo Alto, California-based company. The 26-year-old was recently named Time magazine's "Person of the Year."

In charm mode, China leader pledges US jobs

CHICAGO, January 21, 2011 (AFP) - Chinese President Hu Jintao on Friday promised to help create needed jobs in the United States as he basked in a warm welcome in Chicago at the end of an often contentious state visit.

A day after heated discussions with lawmakers in Washington, Hu tried to show a more human side of the rising Asian power as he visited the third largest US city, where he met with business leaders, students and local dignitaries.

At a suburban warehouse, Hu toured an exhibition showcasing more than 30 Chinese companies that operate in the Midwestern metropolis which he said "have injected fresh momentum into the American economy and created jobs here."

"The Chinese government will continue to encourage our companies to do business and make investments here. We hope the American government will help provide a welcome environment for Chinese businesses," Hu said.

China has faced intense pressure from the United States and other major economies over its economic policies, with Beijing a favorite target of candidates during last year's congressional election.

Many US lawmakers accuse China of artificially keeping its currency low so it can flood the world with cheap exports. Hu, in a speech in Washington, hit back by saying that US consumers have saved $600 billion in the past decade thanks to "quality yet inexpensive Chinese products."

Commerce Secretary Gary Locke, addressing a trade forum in Chicago on the sidelines of Hu's visit, said US businesses worried in China about the theft of intellectual property, closed decision-making and preferences toward domestic companies.

"In my travels across the country, I continue to hear stories of exasperation from American business leaders concerned about the commercial environment in China," Locke said.

At the start of Hu's visit, President Barack Obama's administration said that China had agreed to contracts that would support 235,000 US jobs including a $19 billion deal to buy 200 planes from Chicago-based Boeing Co.

Mayor Richard Daley escorted Hu throughout his tour of Chicago, the adopted hometown of Obama and home to some 300 companies that do business in China including Boeing, telecom giant Motorola and iconic chewing gum maker Wrigley.

"Our long-range goal is to make Chicago the most 'China-Friendly' city in the United States," Daley said.

Hu started the final day of his state visit at a Chicago school that teaches Chinese language. He beamed as a student presented him with a bouquet of orchids.

Chicago teenagers learning Chinese waved flags and shouted "Huanying," or "Welcome," as he arrived. Students donned traditional garb as they performed Chinese handkerchief and kung fu fan dances.

"I hope that all the students here will manage to practice hard, study hard in good conscience and carry full convictions forward into their lives," Hu said, as he invited 20 of the teenagers and faculty members to visit China.

"We were especially struck by how bright and inquisitive the students are," Hu said.

Kristin Brantley, 16, said she studies Mandarin and Chinese culture because "I think it's going to be important in the future."

"It's pretty exciting. All my teachers have been telling us this is a huge deal," she said.

Obama on Wednesday welcomed Hu for a gala black-tie dinner at the White House, part of efforts between the world's two largest economies to seek areas of cooperation despite rivalry on numerous issues.

Hu and Obama disagreed at a joint news conference on a series of points, including over China's human rights record.

But the Obama administration said that it sensed progress over North Korea, with China joining the United States in expressing concern over Pyongyang's uranium enrichment.

The New York Times reported Friday that Obama stepped up the tone on North Korea, warning Hu that the United States will have to redeploy forces in Asia unless Beijing reins in its ally.

White House spokesman Robert Gibbs did not confirm the report, but said that the US side had tried to get China to understand its deep concerns over North Korea's actions.

Whatever progress was made, China has steadfastly declined to condemn North Korea over last year's sinking of a South Korean warship that sent tensions soaring.

Obama to answer questions from YouTube users

WASHINGTON, January 21, 2011 (AFP) - US President Barack Obama will answer questions from YouTube users in a live event on the video-sharing site next week, the White House said.

Obama will be live-streaming on YouTube at 2:30 pm (1930 GMT) on Thursday, two days after he delivers his annual agenda-setting State of the Union speech to a joint session of the US Congress.

Obama also conducted a 40-minute interview with YouTube users following last year's speech and the initiative is one of a number of moves being taken by the White House to engage with the public using the Internet.

Senior White House officials are to answer questions at the White House website at WhiteHouse.gov submitted through Twitter or Facebook immediately following the State of the Union speech.

And White House Press Secretary Robert Gibbs will be answering questions from the public on his Twitter feed, @PressSec, before the address.

Google-owned YouTube said Obama's speech and the Republican response will both be streamed live.

Questions for Obama can be submitted at youtube.com/askobama. YouTube said video questions are "highly preferred" and should be about 20 seconds long.

YouTube said Obama will respond to the questions that have received the most votes from users of the site.

Last year, one of the most popular questions concerned legalization of marijuana as lobbying groups -- as they have done with previous open Internet forums -- mobilized their supporters to flood YouTube with submissions.

Obama embraced the Internet during his presidential campaign for organizing, fundraising and communicating and the White House has a channel on YouTube in addition to its presence on Facebook, Flickr, MySpace and Twitter.

Google targets spam-laden websites

SAN FRANCISCO, January 21, 2011 (AFP) - Google on Friday said it has made it harder for spam-packed websites to rank high in results at the world's top Internet search engine.

While the amount of "webspam" in query results is less than half of what it was five years ago, the California-based Internet firm has seen a "slight uptick" in recent months, according to Google principal engineer Matt Cutts.

"Webspam is junk you see in search results when websites try to cheat their way into higher positions in search results or otherwise violate search engine quality guidelines," Cutts explained in a blog post.

"We recently launched a redesigned document-level classifier that makes it harder for spammy on-page content to rank highly."

The new classifier better detects words or phrases typical of "junky, automated, self-promoting" comments repeated on pages at spam websites, according to the engineer.

Google also "radically improved" its ability to detect when legitimate websites have been tainted by hackers in the kinds of attacks that were a major source of spam last year, according to Cutts.

Other spam-fighting tactics being considered at Google include identifying websites laden with content copied from elsewhere on the Internet, he added.

Cutts stressed that having Google-powered ads on pages did not elevate them in search results or bar websites from repercussions of violating quality guidelines.

2011/01/21

Singapore Airlines raises fuel surcharges

SINGAPORE, January 21, 2011 (AFP) - Singapore Airlines (SIA) on Friday announced additional fuel surcharges as a result of rising world oil prices and hinted that the cost of flying on the premium Asian airline could rise further.

The increases will also apply to its regional wing SilkAir and range from $3 to $27 depending on the distance and class of travel.

"Singapore Airlines will increase its fuel surcharges for tickets issued on or after 27 January 2011 as a result of the recent sharp and sustained escalation in the price of jet fuel," it said.

The adjustment "will offer only partial relief from the higher operating costs arising from increases in the price of jet fuel," SIA said, adding it will continue to closely monitor oil price movements and "keep surcharges under constant review".

Jet fuel is now above $110 per barrel, the firm added.

It was SIA's second increase in fuel surcharges since December 2, when jet fuel prices were above $95 per barrel.

Before December, the last increase was in June 2008. There were three fuel surcharge cuts -- in September and November 2008 and in February 2009, the carrier said.

"It's a good sign that SIA is reacting quickly because the trend is that oil prices are inching higher," Shukor Yusof, an aviation analyst with Standard & Poor's Equity Research, told AFP.

SIA needs to raise fuel surcharges as oil prices increase because, "As a tier-one airline, it costs a lot more to produce the products that they have on board compared to other airlines," Shukor said, adding that SIA's entire fleet is made up of big planes.

But he said even low-cost carriers, which operate smaller planes, might raise fuel surcharges because they are also vulnerable to higher fuel prices.

"If you're a passenger, at the end of the day you just have to grin and bear it," Shukor said.

Benchmark crude futures were higher Friday, buoyed by a strong Chinese economy. China is the world's biggest energy consumer.

New York's main contract, light sweet crude for March delivery, gained 39 cents to $90 per barrel in late Asian trade. Brent North Sea crude for March advanced 54 cents to $97.12.


Preserve racial, religious unity: Lee Kuan Yew

SINGAPORE, January 21, 2011 (AFP) - Elder statesman Lee Kuan Yew on Friday urged Singaporeans to preserve racial and religious harmony, saying the city-state was still "a nation in the making" despite its rapid rise to prosperity.

"I do not deceive myself for one moment that our differences of race, culture, language, religion, have disappeared," he said at the launch of a new book on his thoughts about the future of the island that he led to independence from Malaysia in 1965.

"The message I want to convey is a simple one: we are a nation in the making. Will we make it? Am I certain we'll get there? No, we cannot say that. Something may go wrong somewhere and we'll fall apart," he said.

"It is the business of your generation, and the generation that succeeds you to understand the vulnerability, the fragility of our society and keep it in cohesion, keep it united and keep it as it is today, tolerant of each other, accommodating each other."

Lee, 87, was speaking at the launch of "Lee Kuan Yew: Hard Truths to Keep Singapore Going," published by media giant Singapore Press Holdings and based on exclusive interviews by its flagship daily, the Straits Times.

Singapore, which prides itself on its political stability, has a predominantly Chinese population, with minority races including Malays and Indians plus a growing foreign community now comprising one-fifth of the population of five million.

"You have a nation like China or Japan, China can be ravaged, demolished but the people come together again and rebuild. I'm not sure if Singapore were damaged, ravaged and demolished, they could ever come together again."

"So this precious, accidental, improbable, unlikely nation that we have created should be nurtured, carefully strengthened and built upon."

In excerpts published by the Straits Times ahead of the book launch, the silver-haired politician who served as prime minister from 1959 to 1990 and lost his wife Kwa Geok Choo in October touched upon a personal wish.

He said he wanted his family home torn down for redevelopment after he dies instead of being turned into a historical shrine.

"I've told the Cabinet, when I'm dead, demolish it," said Lee, who now advises his son Prime Minister Lee Hsien Loong and holds the special title Minister Mentor.

Taiwan seeks death penalty for election eve gunman

TAIPEI, January 21, 2011 (AFP) - Taiwanese prosecutors said Friday they were seeking the death penalty for the man accused of an election-eve shooting that wounded former vice-president Lien Chan's son and killed a bystander.

The suspect, Lin Cheng-wei, was indicted on charges of murder, attempted murder and illegal possession of firearms, said Chen Cheng-fang, a spokeswoman for the prosecution.

"We demand the death penalty for the suspect because he has shown no remorse and he committed a grave offence that seriously affected the social order and Taiwan's image for holding fair elections," she said.

Prosecutors hope to make an example of Lin by requesting the most severe punishment and help to curb election-related violence, she said. The defence has yet to reveal its argument.

Lin -- who has been nicknamed "Horse Face" by locals and the media -- was arrested on the scene after shooting Sean Lien in the face at a November campaign rally for the ruling Kuomintang (KMT) party.

A man in the crowd was hit by the same bullet and died on the spot, only hours before Taiwanese voters went to the polls in key local elections.

Lien was rushed to hospital for emergency surgery and released after ten days of treatment, police and doctors have said.

Prosecutors said Lin, who had some personal disputes with the KMT candidate Lien was backing, apparently made a mistake and shot Lien instead because he happened to be standing at the centre of the stage at the time of the shooting.

President Ma Ying-jeou condemned the shooting as an assault on the island's democracy, but said he believed it had little impact on the election outcome, which handed the KMT victories in three out of five mayoral races.

However, the main opposition party claimed that the incident led to unfair elections and went to court last month seeking to annul the results.

Lien's shooting revived painful memories of another election-eve shooting in 2004, when then president Chen Shui-bian and his deputy Annette Lu were shot while campaigning for re-election in southern Taiwan.

Critics alleged that the shooting was staged to win sympathy for Chen, who eventually won by a razor-thin margin in a disputed election that plunged the island into turmoil for months.

Obama warned Hu to pressure NKorea: report

WASHINGTON, January 21, 2011 (AFP) - President Barack Obama warned Chinese President Hu Jintao that Washington would have to redeploy forces in Asia unless Beijing stepped up pressure on North Korea, The New York Times reported Friday.

The US "warning, first made in a phone call to Mr. Hu last month and repeated over a private dinner at the White House on Tuesday, persuaded China to take a harder line toward North Korea," the report said citing an unnamed US official.

It said the push seeking action from the visiting Chinese leader "opened the door to a resumption of dialogue between North and South Korea."

Just Thursday, Seoul said that it had agreed to hold defense talks with the North, the first engagement between the Koreas since a deadly North Korean artillery attack on a South Korean island in November. The strike lurched the peninsula seemingly to the brink of war.

While China has not condemned North Korea for torpedoing a South Korean warship, Hu on his visit did for the first time join the United States in voicing concern at "a new North Korean uranium-enrichment plant. But there were no immediate signs that it planned to punish the North for its defiance," the report added.

Pressure from the US president "reinforced by cabinet members like Defense Secretary Robert M. Gates, moved China into much closer alignment with the United States in dealing with North Korea."

"Without help from China, which is the major supporter of the North Korean government, Mr. Obama told Mr. Hu that the United States would have to take long-term measures, like redeploying its forces, changing its defense posture or beefing up military exercises in Northeast Asia," the unnamed administration official told the Times.

"It was not meant to suggest pre-emption, but we were projecting that a North Korea that becomes a national security threat is going to get a response," the report quoted the unnamed official as saying. "That was attention-getting for the Chinese."

Washington irked Beijing last year when it sent the aircraft carrier George Washington to take part in joint drills with South Korea in the Yellow Sea after Pyongyang sunk a warship from the South.
mdl/mm

Japan drops collision case against Chinese skipper

TOKYO, January 21, 2011 (AFP) - Japanese prosecutors said Friday they would drop the case against a Chinese trawler captain for allegedly ramming two coastguard boats in a September collision that sparked a seething territorial row.

They also decided not to indict a former coastguard officer who leaked a controversial video showing the incident that sent relations between China and Japan plunging to their worst in years.

The decision to drop the case against trawler captain Zhan Qixiong was expected, given that he had been freed two weeks after the collision in what was seen as a diplomatic climbdown amid pressure from Beijing.

The incident took place near the disputed but uninhabited chain of islands known as Senkaku in Japan and Diaoyu in China.

Japan arrested Zhang, triggering protests from Beijing and sending diplomatic relations between Japan and Chin plunging.

But prosecutors released the captain after Beijing cut political, economic and cultural exchanges and detained four Japanese citizens for video recording in a military area.

In a separate case, former coastguard Masaharu Isshiki, 44, admitted to posting a video of the collision on YouTube, actions which lead to his resignation and disciplinary proceedings against others, including the chief of the entire agency.

The video, recorded by the coastguard, showed a Chinese fishing trawler colliding with two Japanese coastguard vessels in the East China Sea in early September.

Isshiki was alleged to have copied footage of the collisions on to a USB data storage device from a computer aboard his patrol boat, and posted clips taken from it on the YouTube video-sharing website.

Tokyo prosecutors had considered the video confidential amid fears its leakage risked inflaming the row between China and Japan, and studied if the officer should be held responsible for a breach of confidentiality obligations.

But they decided the level of confidentiality of the video was low, given that many other coastguard officers had been granted access to watch it.

Singapore's Lee wants home demolished

SINGAPORE, January 21, 2011 (AFP) - Singapore's elder statesman Lee Kuan Yew wants his family home torn down for redevelopment after he dies instead of being turned into an historical shrine.

In excerpts from a new book launched Friday, Lee said he had already instructed the government to destroy the British colonial-era bungalow situated off the premier Orchard Road shopping belt after his death.

"I've told the Cabinet, when I'm dead, demolish it," the 87-year-old Lee,  who now advises his son Prime Minister Lee Hsien Loong, said in remarks published by the daily Straits Times.

"I've seen other houses, Nehru's, Shakespeare's. They become a shambles after a while," he said, the former referring to India's independence hero Jawaharlal Nehru.

The newspaper's parent company Singapore Press Holdings is publishing the book "Lee Kuan Yew: Hard Truths to Keep Singapore Going". It is based on  exclusive interviews with Straits Times journalists.

The famously frank and unsentimental Lee described his home -- built more than a century ago by a Jewish merchant -- as "a big rambling house with five bedrooms and three others at the back" and cracks on the walls.

Lee, who gave the interviews before his wife died in October last year, said his family would not miss the house, which he has owned since the 1940s.

"I don't think my daughter or my wife or I, who lived in it, or my sons who grew up in it, will bemoan its loss. They have old photos to remind them of the past," he said.

Key meetings of what would become the ruling People's Action Party met in the house's basement to plot strategy during its formative years, the newspaper reported.

The PAP has ruled Singapore since 1959, when the island gained self-rule from Britain.

Lee, who served as prime minister from 1959 to 1990, was pragmatic about the house's economic value.

"Because of my house the neighbouring houses cannot build high. Now demolish my house and change the planning rules, go up, the land value will go up," he said.

World 'running out of Internet addresses'

SYDNEY, January 21, 2011 (AFP) - The world will run out of Internet addresses "within weeks", according to one of the founding fathers of the web, a report said Friday.

Vint Cerf, who helped create the web by connecting computers using Internet Protocol (IP) addresses, said it was his "fault" that the 4.3 billion addresses created were running out, the Sydney Morning Herald reported.

"I thought it was an experiment and I thought that 4.3 billion would be enough to do an experiment," Cerf, who is Google's vice president and "Chief Internet Evangelist", was quoted as saying in an interview.

"Who the hell knew how much address space we needed?"

In 1977, Cerf created the web protocol IPv4, which connects computers globally, as part of an experiment while working with the US Department of Defense. He said he never expected his experiment "wouldn't end".

"It doesn't mean the network stops, it just means you can't build it very well," Cerf said.

IP addresses are the unique sequence of numbers assigned to each computer, website or other internet-connected devices. They are not the same as website domain names.

The overwhelming number of devices now accessing the internet means the addresses are running out fast.

To resolve the crisis, an updated protocol for the Internet, IPv6, currently being planned by the industry, will create trillions of addresses.

As Google vice president Cerf, who was in Australia to address a conference, said he thought the new chief executive of the California-based giant, Larry Page, was ready to lead the company into the future.

In a surprise move, Google announced on Thursday that co-founder Page would replace Eric Schmidt as chief executive in April.

Schmidt, 55, a former chief executive of Novell, will remain with Google as executive chairman, focusing on deals, partnerships, customers and government outreach, Google said.

He will also act as an adviser to Page, 37, who served as CEO previously, from 1998 to 2001.
Cerf said Schmidt had been chief executive for 10 years -- "a nice round number" -- and Page was ready to lead the company into the future.

"Larry and Sergey are 10 years older than they were when they thoughtfully hired Eric to be the CEO... so everybody's growing up," Cerf said.

Google has grown over the past decade from a start-up battling other Internet search engines into a technology giant with nearly 25,000 employees and annual revenue of nearly $30 billion.

The company meanwhile reported its fourth-quarter net profit increased to $2.54 billion from $1.97 billion a year ago, while revenue rose 26 percent to $8.44 billion.

Warner Music seeking buyers, wants EMI: report

NEW YORK, January 21, 2011 (AFP) - Major US record company Warner Music has hired investment bank Goldman Sachs to search for potential buyers as it pursues a bid for Britain's troubled EMI, The New York Times reported Thursday.

Warner, whose catalog of artists includes Frank Sinatra, the Bee Gees, The Doors, Youssou N'Dour, REM and Green Day, decided to hire Goldman after buyout firm Kohlberg Kravis Roberts (KKR) and others sought to buy the firm, the Times said, citing an executive briefed on the matter.

The newspaper said the auction could see Warner sell only its prized publishing branch Warner/Chappell, rather than the entire company.

A separate team of bankers at Goldman has also been working on Warner's potential acquisition of EMI, according to the Times. The bank has namely been in touch with Citigroup, which owns much of EMI's debt and could soon control the company if it does not make its payments.

NEC, Lenovo in talks on joint venture: report

TOKYO, January 21, 2011 (AFP) - Leading Japanese and Chinese electronics firms NEC Corp. and Lenovo Group are in the final stages of talks to form a joint venture in the personal computer business, a report said Friday.

A likely scenario would see Lenovo taking a majority stake in NEC Personal Products Ltd., a wholly owned NEC unit that makes and sells PCs, the Nikkei business daily said.

The leaders in their respective domestic PC markets aim to boost their competitiveness through economies of scale by combining development, production and materials procurement, it said.

They could also decide to work together in other areas such as information technology equipment and services, the Nikkei said.

NEC controlled about 18 percent of the Japanese PC market in 2009, but globally it came in 12th with a share of less than one percent, the Nikkei said, citing data by IDC intelligence firm.

Lenovo had roughly 27 percent of its home market and was ranked fourth in the world with a market share of about eight percent, it said.

By working together, they hope to catch up with such global giants as top-ranked Hewlett-Packard Co. of the United States, the Nikkei said.

US lauds Hu comment on human rights

WASHINGTON, January 20, 2011 (AFP) - The White House Thursday billed President Hu Jintao's comment that China needed to do more on human rights as unprecedented, and warned the world would watch to test Beijing's compliance.

"You would all have to strain your recent memory to find a leader from China traveling outside of his country... making such a frank admission of the improvement that needed to happen," White House spokesman Robert Gibbs said.

Hu's comment during a press conference alongside President Barack Obama on Wednesday attracted intense interest, and was played up in some reports as a significant shift in rhetoric on China's human rights policy.

However, Hu's true intentions remained unclear, and he several times stated that China did not share western conceptions of human rights, saying "national" characteristics and different circumstances needed to be recognized.

His emphasis on the social challenges and development needs of China appeared to follow traditional government formulations on human rights and indicate that Beijing is not about to change its policies on political dissent.

But the White House chose to interpret the remarks as evidence of steady progress on a number of issues including economics and security, that Obama aides said emerged from Wednesday's summit.

"The news was just that, that President Hu realizes -- and told the world -- that China has to do better," Gibbs said.

"The world heard the leader of China make that important admission, and the world will watch to see the steps that they take over the course of the next many months... to make the improvements that he says need to be made."

Obama twice stated in public on Wednesday in front of Hu that the United States would not shirk from raising its "core" beliefs of the importance of universal human rights, despite seeking to improve ties with China.

Officials said that Obama also raised the plight privately of his successor as Nobel peace laureate, Liu Xiaobo, who is languishing in a Chinese prison after calling for political reforms.

"We have some core views as Americans about the universality of certain rights -- freedom of speech, freedom of religion, freedom of assembly -- that we think are very important and that transcend cultures," Obama said during Wednesday's press conference.

"I have been very candid with President Hu about these issues."

Hu at first did not answer a US reporter's question about human rights, but prompted to respond later, said it had not been translated for him, and launched into a detailed defense of China's record.

He said China had made "enormous progress" on human rights, but argued his was a vast nation with many social and economic development problems, apparently rationalizing US criticisms of its behavior.

"We do believe that we also need to take into account the different national circumstances when it comes to the universal value of human rights," Hu said, but admitted "a lot needs to be done in China in terms of human rights."

China leader warns US on Tibet, Taiwan

WASHINGTON, January 20, 2011 (AFP) - Chinese President Hu Jintao on Thursday warned the United States to respect Beijing's sovereignty over Taiwan and Tibet but assured that his country had no interest in engaging in an arms race.

Hu repeatedly urged "mutual respect" and cooperation between the Pacific powers as he delivered a policy speech on a state visit in which his hosts have repeatedly pressed him about human rights.

At a luncheon with senior US officials and business leaders, Hu said that Taiwan and Tibet "concern China's sovereignty and territorial integrity and they represent China's core interests."

"A review of the history of our relations tells us that US-China relations will enjoy smooth and steady growth when the two countries handle well issues involving each other's major interests," Hu said.

"Otherwise our relations will suffer constant trouble or even tension," he warned.

President Barack Obama, at a joint news conference with Hu on Wednesday, had urged China to engage in talks with the Dalai Lama, Tibet's exiled spiritual leader, although he reaffirmed the US view that the Himalayan territory is part of China.

The United States and its allies, particularly Japan, have repeatedly voiced concern about China's double-digit growth of military spending. China tested a stealth fighter this month just as US Defense Secretary Robert Gates visited.

Hu dismissed concerns, saying: "We do not engage in arms races or pose a military threat to any country. China will never seek hegemony or pursue an expansionist policy."

However, much of Hu's speech was conciliatory. He urged cooperation between the world's largest developed and developing nations on issues from reviving the moribund Doha trade liberalization talks to fighting climate change.

"China and the United States should pursue global cooperation as partners to fulfill common responsibilities and meet common challenges," Hu said.

He also said China sought to work with the United States around Asia, despite growing concerns in Japan and Southeast Asian nations about Chinese assertiveness in recent months over myriad territorial disputes.

"We should stay committed to promoting peace, stability and prosperity in the Asia-Pacific region, engage in open and inclusive regional cooperation and turn the Asia-Pacific into an important region where China and the United States work closely together on the basis of mutual respect," Hu said.

The leader of the world's most populous nation also hit back at the sour US mood over China's economic clout. Hu met earlier Thursday with US lawmakers, many of whom accuse China of killing American manufacturing jobs by keeping its currency artificially low.

Hu, citing an unspecified study, said that "quality yet inexpensive products" from China have saved US consumers 600 billion dollars over the past 10 years.

In China, more than 70 percent of US companies stayed profitable even during the worst of the global economic crisis, Hu said.

"The China-US relationship is not one in which one side's gain means the other one's loss," Hu said.

Google co-founder Page replacing Schmidt as CEO

SAN FRANCISCO, January 21, 2011 (AFP) - In a surprise shakeup of its top management, Google said Thursday that Eric Schmidt, the chief executive over the past decade, will step aside in April for co-founder Larry Page.

Google said the company's other co-founder, Sergey Brin, who along with Page and Schmidt has led the "triumvirate" at the helm of the Internet search titan, would be responsible for strategic projects and new products.

The management changes, which overshadowed the Mountain View, California-based company's announcement of strong fourth quarter earnings, are due to take effect on April 4.

Schmidt, 55, a former chief executive of Novell, will remain with Google as executive chairman, focusing on deals, partnerships, customers and government outreach, Google said in a statement.

He will also act as an adviser to Page, 37, who served as CEO previously, from 1998 to 2001, and Brin, also 37.

"Day-to-day adult supervision no longer needed!" Schmidt said on Twitter in a reference to when the young co-founders brought him in to run the day-to-day operations of the then-fledgling company.

Google has grown over the past decade from a startup battling other Internet search engines into a technology giant with nearly 25,000 employees and annual revenue of nearly $30 billion.

The company meanwhile reported its fourth-quarter net profit increased to $2.54 billion from $1.97 billion a year ago, while revenue rose 26 percent to $8.44 billion.

Technology bloggers and analysts were uncertain what exactly to make of the shakeup at the company that dominates the search market but has been coming under pressure from social networking rivals such as Facebook and Twitter.

Danny Sullivan, editor-in-chief of technology blog SearchEngineLand.com, said Google was "probably overdue for a major management reorganization."

"The structures between the three have remained exactly the same over the past 10 years -- which might as well be 100 years of Internet time," he said in a blog post.

"It could be that Schmidt wants a break from being the main public face of the company."

Sullivan noted that Schmidt had come in for criticism for awkward recent statements "harmful to Google's reputation" and the three top executives may have decided "it was time for a fresh public face."

John Battelle, author of "The Search," a book about Google and technology rivals, said: "Eric has been at it for a decade, a very long time to be running a company, particularly one that has very headstrong founders in key positions of power."

"I think it's fair to say that Larry Page will not be a conventional CEO -- he's not been much of a public figure for the past 10 years," Battelle added on his blog, Battellemedia.com.

"It will be interesting to see if that changes, or if Page chafes at the relentless public demands of running a massively scrutinized public company."

Venturebeat's Owen Thomas said "Page's emphasis has always been on the company's products."

"With his ascendancy, the company's engineers will reign unchallenged -- not that they had much trouble before," Thomas said.

In a blog post, Schmidt said: "Larry, Sergey and I have been talking for a long time about how best to simplify our management structure and speed up decision making."

"This triumvirate approach has real benefits in terms of shared wisdom, and we will continue to discuss the big decisions among the three of us," he added, noting each member of the trio had been equally involved in decision-making over the past 10 years.

"But we have also agreed to clarify our individual roles so there's clear responsibility and accountability at the top of the company."

He said Page was "ready to lead," and anticipated working "for a long time to come" with Page and Brin.

Page praised Schmidt as a "tremendous leader" who did an "outstanding job" leading Google.
"There is no other CEO in the world that could have kept such headstrong founders so deeply involved and still run the business so brilliantly," he added.

Google shares were up 1.35 percent to 635.26 dollars in after-hours electronic trading after the strong earnings results and management shakeup were announced.

Japanese housewives' secret savings 'at 3-year low'

TOKYO, January 20, 2011 (AFP) - The "secret savings" of Japanese housewives hit a three-year low in 2010 as they were forced to compensate for slumping family incomes with the hidden reserves, according to a survey released on Thursday.

The value of "hesokuri" -- the cash and investments that housewives stash away without telling their husbands -- came to an average 3.08 million yen ($37,520) last year, a unit of Sompo Japan Insurance Inc. found in a survey.

It was the lowest level since 2007, according to the survey carried out in mid-December, covering 500 housewives across the nation who were on average 39.7 years old.

"Hesokuri" is a common practice in Japan, where married women tend to stay at home to look after their families' domestic needs and squirrel away a small portion of their husbands' salaries as discretionary money.

But many of the respondents said they had to use more of the secret funds to pay daily bills last year, as family incomes and bonuses decline at a time of economic fragility for Japan.

In 2010 43 percent of housewives said they were able to secure "hesokuri", with the largest individual savings standing at 35 million yen compared with 100 million yen a year ago, the poll showed.

Asia-Pacific computer sales rise 19% in 2010: IDC

SINGAPORE, January 20, 2011 (AFP) - Sales of personal computers in the Asia-Pacific area outside Japan rose 19 percent in 2010, in another sign of the region's robust economic growth, technology industry analyst IDC said Thursday.

Computer sales reached 107 million units last year, with most markets posting double digit growth, it said in a press statement.

"The full year growth rates clearly show that the region has picked itself up from the economic slump that plagued the region in the past year or two," said IDC analyst Bryan Ma.

Last year's growth was faster than the 15 percent expansion posted in 2009 and 11 percent in 2008 but much weaker than the 27 percent rise in 2007 before the global economic slump.

Chinese computer giant Lenovo remained the regional leader in 2010, with a 20.2 percent market share, followed by US rivals Hewlett-Packard and Dell, with Taiwan's Acer and Asus rounding up the top five.

2011/01/20

China media largely avoids Hu's comments on rights

BEIJING, January 20, 2011 (AFP) - The visit by Chinese President Hu Jintao to the United States Thursday was widely reported by the state media here, but his comments on China's beleaguered human rights situation got scant mention.

China Central Television's (CCTV) nightly news broadcast, often seen as the nation's most widely viewed programme, devoted nearly its entire 30 minute show Thursday to Hu's meetings with US President Barack Obama.

China's state-controlled media widely covered the visit, reflecting the country's rise as a major global economic and political power, while bolstering the image of Hu -- who also heads the ruling Communist Party -- as a leading world statesman.

Most aspects of Hu's visit, including the welcoming ceremony on the White House lawn, talks with Obama and former US president Bill Clinton, a joint press conference and an elaborate state dinner were covered in full.

State media also praised the agreement for the two nations to cooperate on a wide range of issues, including trade, military-to-military ties, exploration of space and global security issues.

But Hu's acknowledgement that China's human rights situation required attention was ignored by CCTV's nightly news broadcast and many other domestic news outlets, including the leading Xinhua news agency.

"China recognizes and also respects the universality of human rights," Hu said in a press conference with Obama.

"A lot still needs to be done in China, in terms of human rights."

Human rights issues have long been a point of contention between China and Western developed nations.

However, not all state media ignored Hu's comments as CCTV's English channel, the English-language China Daily -- both largely produced for foreign consumption -- and the China News Service carried the remarks partially or in full.

Taiwan may test missiles again after flop

TAIPEI, January 20, 2011 (AFP) - Taiwan is considering new missile tests after a series of failures in a drill this week earned the top brass rare criticism from an irate President Ma Ying-jeou, media and an official said Thursday.

Six out of the 19 missiles missed their targets or failed to explode during a live-fire manoeuvre Tuesday, prompting Ma to publicly tell the military that he was "not very satisfied", urging it to practice some more.

Although the military insisted the result was acceptable, it now plans to re-test three types of missile that failed during the drill, the Liberty Times said, without citing its source.

The missiles include the home-made Tien Chien II ("Sky Arrow II"), US-made Sparrows and the French-made Mica, the paper said.

"They may be tested again during another drill to be held in the second half of this year, but no final decision has been made," a defence ministry official told AFP on condition of anonymity.

Taiwan has ruled itself since the end of a civil war in 1949, but Beijing still considers the island part of its territory and has never renounced the potential use of force to get it back.

The island's relations with China have improved since Ma took over as president in 2008 on a campaign promise to lift the island's economy through closer interaction with Beijing.

China says economy grew 10.3% in 2010

BEIJING, January 20, 2011 (AFP) - China said Thursday that its economy grew 10.3 percent in 2010, marking the fastest annual pace since the onset of the financial crisis and underlining the country's growing might.

Gross domestic product in China rose by 9.8 percent in the fourth quarter, exceeding analyst expectations, while consumer inflation lost a bit of steam in December as Beijing moved to rein in soaring prices.

The 2010 GDP figure, up from a revised 9.2 percent growth in 2009, highlighted China's powerful performance in a year when it overtook Japan to become the world's second-largest economy behind the United States.

"Currently the economy is in a critical period of transforming from recovery to stable growth," Ma Jiantang, Commissioner of the National Bureau of Statistics, told reporters.

Ma said China would step up efforts to transform the country's "economic growth pattern" -- referring to the Beijing's oft-stated aim to boost domestic consumption and reduce its reliance on exports and investment.

His comments were echoed by President Hu Jintao, who told US business leaders during a high-profile visit to Washington on Wednesday that China would boost interior demand and consumer spending.

The country's consumer price index, the main guage of inflation, rose by 4.6 percent year-on-year in December compared with 5.1 percent in November, which was the fastest pace in more than two years.

The index rose 3.3 percent for all of 2010 -- exceeding the government's full-year target of three percent as food costs soared.

"We should have full confidence that we will be successful in 2011."

Analysts said the still-high inflation figure in December supported the case for further interest rate hikes and bank lending restrictions.

"Price pressures will remain uncomfortably strong in the months ahead, and the dip in headline CPI inflation in December will likely be temporary," said Brian Jackson, an analyst at Royal Bank of Canada.

IHS Global Insight analyst Alistair Thornton agreed.

"A new wave of credit expansion is driving inflationary pressure, in both consumer prices and asset markets, with a re-acceleration in construction and fixed investment," Thornton said.

Output from the country's millions of factories and workshops rose 15.7 percent for all of 2010, faster than in 2009 as manufacturers cranked up activity to meet growing demand for Chinese-made goods.

Urban fixed asset investment, a measure of government spending on infrastructure, rose 24.5 percent over the 12 months -- slower than in the previous year as Beijing started to wind back crisis-stimulus measures.

Retail sales, a key indicator of consumer spending, rose 18.4 percent in 2010.

As the United States and Europe struggle to spur growth, Beijing has been trying to slow its economy and stem a flood of liquidity that is fanning inflation and driving up property prices, straining household budgets.

The central bank last Friday again ordered banks to increase the amount of money they keep in reserve, effectively putting a cap on lending, after raising interest rates twice in the fourth quarter.

Hu admits China has long way to go on rights

WASHINGTON, January 19, 2011 (AFP) - Chinese President Hu Jintao acknowledged on Wednesday that a great deal more needed to be done on human rights in his country, but also stressed "national circumstances" were different in China.

As he welcomed Hu to the White House for a high-profile state visit, US President Barack Obama urged his Chinese counterpart to uphold human rights, saying it could prove key to China's future success.

"History shows that societies are more harmonious, nations are more successful and the world is more just when the rights and responsibilities of all nations and all people are upheld," he said.
"Including the universal rights of every human being," Obama added.

Hu was later grilled on the contentious human rights issue as he and Obama faced journalists at a joint White House press conference.

Pressed a second time to comment on alleged rights abuses in China after a first question appeared to be lost in translation, Hu claimed "enormous progress" had been made and said China was "always committed" to the protection and promotion of human rights.

"China recognizes and also respects the universality of human rights but at the same time we do believe that we do need to take into account the different national circumstances when it comes to human rights," he said.

"China is a developing country with a huge population and also a developing country in crucial stage of reform," he said, admitting "a lot needs to be done in China in terms of human rights."

At the joint press conference, Obama also acknowledged Beijing and Washington had different opinions on human rights and freedoms.

"China has a different political system than we do. China is at a different stage of development than we are," Obama said. "We come from very different cultures and with very different histories."

He said he had been "very candid" with Hu during their talks about issues such as freedom of speech, religion and assembly, admitting "occasionally they are a source of tension between our two governments."

But Obama added he believed, "we can engage and discuss these issues in a frank and candid way, focus on the areas where we agree, while acknowledging there are going to be areas where we disagree.

"I want to suggest that there has been an evolution in China over the last 30 years since the first normalization of relations between the United States and China.

"And my expectation is that 30 years from now we will have seen further evolution and further change," Obama added.

'Uncensored' Playboy coming to iPad: Hefner

WASHINGTON, January 19, 2011 (AFP) - Playboy founder Hugh Hefner is bringing his iconic men's magazine to the iPad.

The octogenarian publisher, in a message on his Twitter feed, @hughhefner, said current and back issues of Playboy would be available on the Apple device in March.

"Big news! Playboy -- both old & new -- will be available on iPad beginning in March," Hefner said.

He did not provide any more details but in response to a question from a Twitter follower Hefner said "Playboy on iPad will be uncensored."

A Playboy spokeswoman said Playboy for the iPad will be a Web-based subscription service with Bondi Digital Publishing that will be "iPad compatible and will utilize iPad functions."

She said the Chicago-based company also plans to release a "non-nude" version of a Playboy-branded iPad application in the coming months that "adheres to all of Apple's policies and guidelines."

Apple has a strict policy of banning nudity in applications for the iPhone and the iPad sold through its App Store.

Playboy already offers an iPhone application for 99 cents that does not feature nudity.

Hefner's iPad announcement came just over a week after he struck a deal to   return Playboy Enterprises to private ownership.

Obama salutes Taiwan-China progress

WASHINGTON, January 19, 2011 (AFP) - US President Barack Obama voiced hope Wednesday for a further easing of tensions over the Taiwan Strait as he pledged to stick to US recognition of Beijing as the sole government of China.

Welcoming Chinese President Hu Jintao for a state visit, Obama welcomed a major trade pact sealed last year between China and Taiwan, which Beijing considers part of its territory.

"I welcomed the progress that's been made on both sides of the Taiwan Strait in reducing tensions and building economic ties," Obama told a joint news conference.

"And we hope this progress continues, because it's in the interest of both sides, the region and the United States."

Obama reaffirmed his commitment to the one-China policy and to the Taiwan Relations Act, a law passed by Congress in 1979 that requires the United States to provide the island with the means to defend itself.

In a joint statement, China stressed that Taiwan "concerns China's sovereignty and territorial integrity" and hoped the United States "will honor its relevant commitments and appreciate and support the Chinese side's position on this issue."

Taiwan's government was set up by Chinese nationalists after they lost the civil war to the communists in 1949. China says the island is awaiting reunification with the mainland, by force if necessary.

China responded angrily last year when the United States sold Taiwan some 6.4 billion dollars worth of arms, including Patriot missiles, Black Hawk helicopters and minesweepers.

Taiwan has been pressing for F-16 fighter jets, fearful that the strategic balance is shifting in China's favor. After China unveiled a stealth aircraft last week, Taiwan conducted a major missile drill, although it was marred by several misses.

However, ties between Beijing and Taipei have improved markedly since the island elected President Ma Ying-jeou in 2008.

Jackie Chan, Barbra Streisand lead Hu state dinner guests

WASHINGTON, January 20, 2011 (AFP) - Action star Jackie Chan and pop diva Barbra Streisand topped a guest list including three presidents and political and media elites at a US state dinner for Chinese President Hu Jintao Wednesday.

At the request of the Chinese side, the menu for the dinner honoring Hu, after a day of frank talks at the White House, was quintessentially American fare, such as poached Maine lobster and dry-aged rib eye with creamed spinach.

And nothing could be more American than the old fashioned apple pie offered as dessert in a final flourish for a meal washed down with a selection of wines from California and Washington state.

Hu, wearing a business suit, posed with President Barack Obama, in black tie, and First Lady Michelle Obama, who was wearing a flowing red and black off-the-shoulder dress, after arriving at the North Portico of the White House.

On the list of 225 guests for Obama's third state dinner were his two predecessors as Democratic presidents, Bill Clinton and Jimmy Carter. Previous events honored the Indian and Mexican leaders.

Henry Kissinger, the Nixon-era national security adviser and secretary of state who played key role in forging relations with communist China, was also invited.

Guests from the art world and the media included cellist Yo Yo Ma, whose parents were ethnic Chinese, and Anna Wintour, the editor-in-chief of Vogue magazine.

Wendi Deng, the wife of media mogul Rupert Murdoch, showed up without her husband, who she said was traveling.

After-dinner entertainment was to be provided by Herbie Hancock and Chinese classical pianist Lang Lang.

Several important Washington powerplayers who would have normally been expected at a state dinner turned down invitations amid anger on Capitol Hill over China's human rights record and economic policies.

Senate Democratic Majority leader Harry Reid, Republican Senate Minority Leader Mitch McConnell and Republican House Speaker John Boehner -- now the third-ranking US elected official -- all chose not to attend.

But former speaker Nancy Pelosi, who now leads the Democratic House minority, was on the guest list, despite her history of fierce denunciations of China's human rights record.

eBay earnings shine on PayPal performance

SAN FRANCISCO, January 20, 2011 (AFP) - Online auction house eBay reported better than expected earnings Wednesday, driven by the success of its online financial transactions service PayPal.

EBay revenue for the quarter ending December 31 was slightly less than $2.5 billion and its net profit was $559.2 million dollars.

"We delivered a strong fourth quarter and a solid year," said eBay chief executive John Donohoe. "We are driving strong local growth at PayPal and strengthening our core eBay business."

PayPal ended the quarter with 94.4 million registered user accounts and handled a total of $26.9 billion in payments during the period, according to eBay. Nearly half of that PayPal revenue came from outside the United States.

The company saw revenue rise in its online auction Marketplaces during the year-end holiday shopping season.

EBay finished the year with a net profit of $1.8 billion on $9.16 billion in revenue.

The San Jose, California-based Internet firm's stock price climbed nearly three percent to $29.90 per share in after-hours trading that followed release of the earnings results.

EBay is adapting its service to changes in how people shop, focusing on the trend of using smartphones to locate bargains or stores and to even pay for things, Donohoe said in an earnings conference call.

"Mobile is increasing the number of Internet-enabled transactions, and in the process it is rapidly blurring the line between online and offline," Donohoe said.

"We are trying to make sure we are aggressively capitalizing on that as a company."

EBay sees PayPal as a reassuring option for shoppers reluctant to enter credit card or other sensitive financial data into mobile phones.

"We are treating mobile as another device in an increasingly seamless shopping experience," Donohoe said.

Along with building up its mobile platform, eBay will continue to beef up its tools to help shoppers easily find things they want.

Donohoe said the firm's strategy will build on recent acquisitions of US Internet startup Milo, mobile gadget application maker Critical Path Software and brands4friends, Germany's largest online fashion shopping club.

Milo is a website that connects shoppers with real-world shops that have what they seek and then lets them compare prices with those in online stores.

EBay announced in December that it bought Critical Path Software as it follows buyers and sellers onto smartphones and other devices.

"We're very serious about innovating in mobile commerce," eBay Marketplace chief technology officer of global products Mark Carges said at the time.

"Integrating the Critical Path Software team into eBay will be a big win for mobile shoppers around the world... we can make shopping and selling anywhere, anytime, for almost anything, even better."

Critical Path had worked with eBay on applications that let smartphone users connect with the online auction house as well as its other services such as classified ads, ticket marketplace StubHub and Shopping.com.

Acquisitions for eBay in the final three months of 2010 included the 200-million-dollar (150 million euro) purchase of Berlin-based brands4friends, which was founded in 2007 and boasted 3.5 million members in Germany.

It sells goods from well-known fashion and lifestyle brands at reduced prices to members through daily offers.

The acquisition was "designed to strengthen eBay's position as a leading online fashion destination in Europe," eBay said.

As part of the deal, eBay will assume brands4friends's equity interests in British shopping club SecretSales.com and in its Japan arm, brands4friends.jp.

The acquisition, which is subject to regulatory approval, is expected to close in the first quarter of this year.

Obama, Hu air divides but seek trust

WASHINGTON, January 20, 2011 (AFP) - US President Barack Obama and Chinese leader Hu Jintao sparred Wednesday over human rights but smoothed over sharp differences and a dearth of breakthroughs by vowing to work to build trust.

On a long-awaited state visit, Hu made the unusual comment for a Chinese president that "a lot" remained to be done on freedoms in China, but pointedly did not share Obama's definition of universal human rights.

Later, the two presidents swapped the dry language of diplomacy for a gala state dinner, sprinkled with stars like action hero Jackie Chan and pop diva Barbra Streisand, in White House rooms bathed in purple and red lights.

"While it is easy to focus on our differences, in cultures and perspective, let us never forget the values that our people share," Obama said in a toast to Hu, pointing to mutual hard work, sacrifice and love of family.

Earlier, trumpets sounded and a 21-gun salute blasted over Washington as Hu arrived at a White House draped with US and Chinese flags, in the most sumptuous pageantry a US president can muster. But tough talking soon ensued.

At a frank press conference, there were few signs the leaders had ended disagreements on the rate of China's yuan currency, access to Chinese markets or strategic issues, despite an earlier announcement of tens of billions of dollars in US export deals.

But both sides promised to seek further cooperation on the world's most pressing issues and Obama welcomed China's rise as a key power and looked forward to an era of "friendly competition."

The president also candidly laid out US differences with China, demanding a level playing field for US firms, said the yuan was "undervalued" and encouraged dialogue with the Dalai Lama's representatives over Tibet.

Obama, under pressure because his successor as Nobel peace laureate Liu Xiaobo is in a Chinese jail, acknowledged China had a different political system than America, but said he would not shirk from raising rights issues.

"We have some core views as Americans about the universality of certain rights -- freedom of speech, freedom of religion, freedom of assembly -- that we think are very important and that transcend cultures," he said.

"I have been very candid with President Hu about these issues."

Later, a senior US official said that Obama had personally raised the case of Liu, jailed in 2009 on subversion charges, though did not detail Hu's response.

Hu at first did not answer a US reporter's question about human rights, but prompted to respond later, said it had not been translated for him, and launched into a detailed defense of China's record.

He said China had made "enormous progress" on human rights, but argued his was a vast nation with many social and economic development problems.

"We do believe that we also need to take into account the different national circumstances when it comes to the universal value of human rights," he said, but admitted "a lot needs to be done in China in terms of human rights."

Earlier, US officials revealed that China would announce a mammoth 45 billion dollars in export deals with Washington, including a purchase of 200 Boeing passenger jets worth an estimated 19 billion dollars.

The order will bolster Obama's bid to convince Americans that his ambitious foreign policy can have a domestic payoff in the wake of the deepest economic crisis in decades, as officials said the deals would support 235,000 US jobs.

And as both sides sought to enhance economic ties, Obama hosted a meeting with Hu and top US business leaders, including executives from Microsoft, Motorola, Goldman Sachs, General Electric, Coca Cola, Boeing and HSBC.

Obama said he hoped Beijing and Washington could ease recent trade frictions and break free of "old stereotypes."

In a sign of the political sensitivity of Hu's visit, top members of Congress, including John Boehner, the speaker of the House of Representatives, declined invitations to attend the state dinner.

Democratic US Senate Majority Leader Harry Reid meanwhile branded Hu a "dictator," then withdrew the remark.

Obama also used the press conference to say that both he and Hu wanted North Korea to halt "further provocations," and agreed that total denuclearization of the peninsula was the "paramount goal."

In a joint statement, both sides expressed concern at North Korea's uranium enrichment program, the first time that Beijing had made such concerns public.

2011/01/19

Obama raises rights in White House welcome for Hu

WASHINGTON, January 19, 2011 (AFP) - US President Barack Obama and China's President Hu Jintao sparred gently over human rights Wednesday, opening a state visit in which calls for cooperation barely masked tensions over economics.

Trumpets sounded and a 21-gun salute blasted over Washington as Hu arrived at the White House against a red, white and blue backdrop of US and Chinese flags, in the most sumptuous pageantry a US president can muster.

The two leaders quickly went into Oval Office talks expected to lay bare disputes over currency policy, trade, US economic policy, access to Chinese markets and differing visions of Asian security and world affairs.

At a welcoming ceremony, Obama said that despite the doubts of some people in both countries, the United States and China had an "enormous stake" in one another's future prosperity and success.

"With this visit, we can lay the foundation for the next 30 years," Obama said.

But Obama also made an early reference to disputes over human rights, as his successor as Nobel peace laureate, Liu Xiaobo, languishes in a Chinese prison after calling for political reform.

"History shows that societies are more harmonious, nations are more successful and the world is more just when the rights and responsibilities of all nations and all people are upheld, including the universal rights of every human being," Obama said.

Hu did not directly respond to Obama's comments in his speech, delivered before invited guests and service personnel in dress uniform on the south law of the White House, calling for greater cooperation and mutual exchanges between the US and Chinese peoples.

But in a hint at Sino-US differences over the issue, he did say "China and the United States should respect each other's choice of development path and each other's core interests."

The Chinese president did, however, praise "new progress" in his government's dealings with the Obama administration, despite a rocky two years in relations between Washington and Beijing.

Hu will be honored later on Wednesday with the full pomp of a state dinner -- only Obama's third such occasion. The two leaders will also hold a press conference.

And in an event symbolizing the uneasy embrace between the world's most powerful advanced economy, and its fastest-developing new economic titan, Obama will host Hu at a meeting of US and Chinese business leaders.

Obama and Hu will also likely spar over Washington's claims that China maintains its yuan currency at an artificially low level to boost its exports -- a practice American critics see as detrimental to US jobs and growth.

The White House meanwhile will be seeking to enlist further Chinese help on combating Iran's nuclear drive, cooling North Korea's belligerence and cooperation on ensuring a peaceful outcome to Sudan's independence referendum.

But few analysts expect major breakthroughs, forecasting instead a realistic appraisal of testing relations and a joint pledge by the United States and China to seek consensus where possible.

But in a sign of domestic political tensions whipped up by the crucial US relationship with China, the White House was forced Tuesday to defend Hu's invitation, and insist it would not mute US concerns on human rights in China.

"We will continue to have difficult conversations, but necessary conversations that have to be had with China and we'll do that again tomorrow," spokesman Robert Gibbs told reporters.

"In order to make progress on certain issues you've seen the two countries work together, despite, again, continuing to have differences on things like continued economic growth and human rights."

And US Secretary of State Hillary Clinton, who shared a private meal with Hu and Obama on Tuesday night, said Wednesday that it was so far unclear whether China was a US friend or foe.

"The reason we're rolling out the red carpet" for the Chinese leader "is we think we'll be better (able) to answer such a question as we move forward," Clinton told ABC television when asked whether China is a friend or foe.

"Well, my hope is we have a normal relationship," she said.

Hu's visit will mark the start of a turning point in US-China relations, as likely his last fully ceremonial journey to the United States before a power transition begins in China that will culminate in a new top leader in 2013.

The talks come at a time when when the United States is weakened by a slowly recovering economy and China's soaring expansion augments its growing power.

China has also been infuriated by the visit to Washington of Tibet's exiled spiritual leader, the Dalai Lama, last year.

The two sides have also been at odds over Chinese treatment of US intellectual property rights, Internet freedom, and naval rivalries in the Pacific, as well as US arms sales to Taiwan.

Clinton cannot say whether China is friend or foe

WASHINGTON, January 19, 2011 (AFP) - As the Obama administration rolled out the red carpet for visiting Chinese President Hu Jintao, US Secretary of State Hillary Clinton could not say Wednesday whether Beijing is a friend or foe.

However, in US television interviews timed with Hu's state visit, Clinton said Washington aimed to avoid a Cold War with Beijing as she called for cooperation ranging from the economy to North Korea.

"The reason we're rolling out the red carpet" for the Chinese leader "is we think we'll be better (able) to answer such a question as we move forward," Clinton told ABC television when asked whether China is a friend or foe.

"Well, my hope is we have a normal relationship," the chief US diplomat said when pressed to answer the question two years after US President Barack Obama's administration launched a charm offensive with China.

Clinton voiced hope for "a very positive, cooperative, comprehensive relationship, where, in some areas, we're going to compete. There's no doubt about that. But in many areas, we're going to cooperate."

During a visit to China in November 2009, Obama declared that the United States and China need not be adversaries.

The Obama administration was at the time accused by US critics of playing down China's poor human rights record in order to appease Beijing, as it sought a partnership to resolve the world's economic crisis and fight climate change.

Obama also angered critics when he declined to meet the Dalai Lama, Tibet's spiritual leader, before his visit to China. Beijing accuses the Dalai Lama of plotting to split up China, dismissing his conciliatory approach as insincere.

However, Obama met with the Buddhist leader in February last year, albeit in a low-key way, and the administration has toughened its stance on human rights.

In a speech on Friday, Clinton urged China to free dissidents and improve treatment of minorities, pledging not to shy away from disagreements when President Hu Jintao pays a state visit.

When asked on NBC television whether there is the risk of a new Cold War, Clinton replied: "We hope to avoid that because we don't think that's in America's interest.

"We want to have an open trading system, we want to have a lot of interchanges between our two countries," she said, adding there would be new steps to improve ties between the American and Chinese peoples.

"It's not just between governments," she said.

"We want to see more cooperation on the economic front," Clinton added.

"We want to see more cooperation dealing with the very thorny problem of North Korea" and its nuclear weapons ambitions as well as "provocative behavior," Clinton said.

As North Korea's ally, China is seen as having leverage over Pyongyang, which sent tension soaring in the region when it revealed a uranium enrichment program and unleashed a deadly artillery barrage on a South Korean island.

"We don't want a zero-sum relationship. We want to look for as many win-win opportunities as we can because this relationship is going to in many ways determine the peace and prosperity of the 21st century," Clinton said.

Indian police arrest 3 Chinese telecom employees

LUCKNOW, January 19, 2011 (AFP) - Indian police said Wednesday they had arrested three Chinese employees of telecom group Huawei who strayed into Indian territory from Nepal.

The two men and a woman were seized on Monday in the north Indian state of Uttar Pradesh, about 180 kilometres (110 miles) from state capital Lucknow, border police officer Deva Anand told AFP.

"The three Chinese nationals were arrested because they were found inside Indian territory without a passport and visa," he said by telephone from Bahraich district in northern Uttar Pradesh.

The suspects, who said they were installing mobile phone towers in Nepal, were produced before a local court on Tuesday and were remanded in custody for 14 days.

China police open fire on protesters: rights group

BEIJING, January 19, 2011 (AFP) - Police opened fire on a crowd of protesters in southern China at the weekend, injuring at least five people, a rights group said Wednesday.

More than 100 workers were marching towards a government building in Guangxi region's Wuzhou city to protest about pay on Sunday when police blocked them and fired, the Information Center for Human Rights & Democracy said.

The Hong Kong-based rights group said at least five people were injured by bullets, and added that a total of around 20 people were being treated in hospital, some with gunshot wounds, others because they fell in the crush.

An employee at the Wuzhou Chinese medicine hospital, who refused to be named, told AFP that 18 people had been hospitalised, all of whom had been injured by gunshots.

But she refused to say who shot the patients, and AFP was not able to independently confirm whether police had indeed fired on the crowd.

A policeman in Wuzhou's Changzhou district confirmed to AFP that a protest had taken place involving workers' pay, adding it had been handled by another police force.

"Some migrant workers demonstrated in the street and many residents watched," the policeman said.

Another official at Wuzhou's public security bureau, surnamed Xie, told AFP more than 100 people had "illegally demonstrated."

China's Baidu edges ahead in top online market

SHANGHAI, January 19, 2011 (AFP) - Chinese search engine Baidu further strengthened its dominance of the world's largest Internet market in the fourth quarter at the expense of US rival Google, a research firm said Wednesday.

Baidu's share of the increasingly lucrative sector hit 75.5 percent in the last three months of the year, compared with 73 percent in the third quarter, Beijing-based Analysys International said in a statement.

Google saw its share of the Chinese search market continue to slide, falling to 19.6 percent in the fourth quarter from 21.6 percent in previous period.

The value of the Chinese search market reached 3.85 billion yuan ($585 million) in the fourth quarter, nearly doubling from a year earlier, the data showed.

China's online population increased 19.1 percent in 2010 to 457 million users, with nearly 82 percent of them using search engines, according to the state-backed China Internet Network Information Centre.

Baidu has seen its market share increase steadily this year following Google's public spat with Beijing over censorship.

In March, Google said it would no longer bow to government censors and effectively shut down its Chinese search engine, automatically re-routing mainland users to its uncensored site in Hong Kong.

But it ended the automatic redirect in June to avoid having its licence suspended by China.

Singapore needs young immigrants: Lee Kuan Yew

SINGAPORE, January 19, 2011 (AFP) - Singapore needs young immigrants to save its economy from long-term decline as a result of a falling birth rate, elder statesman Lee Kuan Yew said in remarks published Wednesday.

"At these low birth rates, we will rapidly age and shrink," the 87-year-old Lee said in comments released to the local media after the government disclosed that the city-state's birth rate fell to a record low in 2010.

"So we need young immigrants. Otherwise our economy will slow down, like the Japanese economy. We will have a less dynamic and less thriving Singapore. This is not the future for our children and grandchildren," he added.

Lee's defence of immigration came amid increasingly vocal criticism in web forums and local media directed at foreigners, who now make up more than 20 percent of the population of five million.

Most of the foreign workers and immigrants come from China, Southeast Asia and India, reflecting Singapore's own ethnic mix.

Lee stepped down as prime minister in 1990 after leading the city-state since 1959, when it gained self-rule from colonial ruler Britain, but remains a powerful figure as an adviser to his son, Prime Minister Lee Hsien Loong.

The former leader said immigrants should be welcomed and integrated.

"The first generation will take some time to integrate, but their children will be completely Singaporean," he said.

"They will increase our population and talent pool. Singapore will be vibrant and prosperous, not declining and ageing," he added.

The resident fertility rate -- or number of babies born per woman -- dipped to 1.16 in 2010, down from the previous record low of 1.22 in 2009, Deputy Prime Minister Wong Kan Seng, who coordinates population policy, said Monday.

The rate, which has fallen as more couples choose to have just one child and more people opt to remain single, is well below the 2.1 babies per woman  needed for the population to replenish itself naturally.

Singapore rolled out the welcome mat for foreign workers during the 2004-2007 economic boom.

But after the 2008 global financial crisis, the government took a fresh look following complaints from citizens that foreigners were increasingly competing for jobs, housing, medical care and even space on metro trains.

The inflow of foreign workers has slowed and full citizens were given more social and other benefits over foreigners.

Taiwan ex-military police chief jailed for 16 years

TAIPEI, January 19, 2011 (AFP) - A former military police chief in Taiwan has been sentenced to 16 years in jail on graft charges in the latest scandal to hit the island's top brass, the defence ministry said Wednesday.

Lieutenant General Ho Yung-chien, the chief aide-de-camp of ex-president Chen Shui-bian, was sentenced by a military high court for embezzling Tw$3.0 million ($102,000), the ministry said.

Prosecutors plan to appeal in a bid to increase the jail term, it added.

Colonel Chen Shuang-huan, a former senior intelligence officer under Ho, received a five-year jail term for helping Ho embezzle the money.

Colonel Wang Chi-hsin, who was also charged with helping Ho, was acquitted because he had cooperated with the prosecutors.

Ho was deputy commander of Taiwan's army reserves when he was detained over corruption allegations in December 2009.

Corruption remains a major problem in Taiwan, with scandals stretching all the way to the top of the political system.

Former president Chen is currently serving a sentence of 17 years for graft.

Chen insists that the legal action against him is a vendetta carried out by Taiwan's Beijing-friendly government in retaliation for his pro-independence stance while in power from 2000 to 2008.

China's economy grows 10.3% in 2010: report

BEIJING, January 19, 2011 (AFP) - China's economy grew 10.3 percent last year as inflation exceeded the government's full-year target, Hong Kong-based Phoenix Television said on its website Wednesday.

The broadcaster cited unnamed central bank sources as saying the figures had been "leaked" a day before the government is due to release key economic data for December and 2010.

The country's consumer price index, a key measure of inflation, rose 3.3 percent from a year earlier over the 12 months, exceeding Beijing's full-year target of three percent as food costs soared.

December inflation slowed to 4.6 percent year on year compared with 5.1 percent in November, which was the fastest pace in more than two years.

The producer price index, which measures the cost of goods at the factory gate, jumped 5.9 percent over the year.

China e-commerce sales up 22% in 2010: report

BEIJING, January 19, 2011 (AFP) - Online sales in China, the world's largest web market, rose 22 percent in 2010 as price-sensitive consumers turned to the Internet for cheaper products amid rising inflation, an industry report said.

Internet sales in the country hit 4.5 trillion yuan ($684 billion) in 2010,  the China e-Business Research Center said in the report published Tuesday.

The data covers business-to-business, business-to-consumer and consumer-to-consumer transactions.

Cheaper prices and growing confidence in online payment security attracted more people to the Internet, with the number of shoppers reaching 158 million last year compared with 121 million in 2009, the report said.

"Internet shopping offers users lower prices and convenience amid high inflation," it said.

"Meanwhile, users' confidence in and reliance on online shopping have strengthened as companies improved their services and product quality."

Consumers are increasingly anxious about soaring living costs, after inflation topped five percent in November for the first time in more than two years.

Consumer online spending nearly doubled to 513.1 billion yuan in 2010 from a year earlier, accounting for around three percent of total retail sales in the country, the report said.

It could exceed one trillion yuan in the next two years.

Commerce ministry spokesman Yao Jian said Tuesday China's retail sales likely reached 15 trillion yuan last year, up 18 percent on year. Key economic data for 2010 are scheduled to be released on Thursday.

E-commerce has been expanding in China as more companies set up online stores to cut costs and improve efficiency, the report said.

There were 25,000 e-commerce websites at the end of 2010, compared with 20,700 at the end of June -- no figure for 2009 was provided.

Highlighting the growing appeal of the country's Internet market, which has more than 450 million users, foreign companies such as Adidas, Gap and Wal-Mart have been opening online stores in China.