The Sydney Morning Herald from Sydney, New South Wales, Australia • Page 7

The Sydney Morning Herald WORLD Friday, November 12, 1993 7 State sector officials gripe over bitter pill prescribed to them in Vice-Premier's austerity package ins of recovery hn casDi clfoaos that Mr Zhu was in trouble politically for having pushed too hard with his economic stabilisation program. But while there is no doubt that he has offended powerful officials in the State sector and in the'provinces, there appears to be no alternative to his prescription for the economy. This combines a squeezing of credit to "hot money" areas like real estate to infrastructure combined with determined efforts to reform China's inefficient financial system. Mr Dai's remarks seem By TONY WALKER Herald Correspondent BEIJING, Thursday: China's tense debate over curbs on an overheating economy surfaced in the official press today with a spirited defence of the austerity-reform program of senior Vice-Premier, Mr Zhu Rongji. The Chinese newspapers prominently featured remarks by a deputy Governor of the People's Bank, Mr Dai Xianlong, claiming success in the austerity campaign as the Central Committee of the designed to claim victory for bringing the economy under control inflationary pressures eased slightly in September and also to offer reassurance that the Central Bank was sensitive to the plight of State industry.

Starting in August, he said, the Central Bank had eased credit restrictions. In the first 10 months of the year, banks had provided 30 billion yuan billion) more in loans than in the same period last year. Mr Zhu, who doubles as the Governor of the Central Bank, is certain to face sharp questioning at the Central Committee meeting over hardship caused to the State sector. The session is expected to last until the weekend, although true to tradition, no details of when it would actually meet or how long it would sit have been released officially in advance. The plenum will approve sweeping reforms in finance, taxation, trade and investment.

Among important reforms is a new federal tax system designed to improve sharing of revenues between the centre and the provinces. Mr Dai blamed lax policies earlier in the year for allowing an explosion in credit that had helped to fuel inflation. Money in circulation in June on an annu-alised basis had grown 54 per cent the highest monthly rise ever. The previous Governor of the Central Bank, Mr Li Guixian, was sacked in June and replaced by Mr Zhu Rongji Among Mr Li's patrons was the Premier, Mr Li Peng, who ruling Communist Party was due to begin discussions in Beijing of a new reform program. "In recent months, China's financial departments have been blocking evil ways while opening correct roads," Mr Dai said bluntly.

Mr Zhu and his team at the central bank, who have been presiding over a squeeze on credit in an effort to combat inflation, have been accused of stifling State enterprises, some of which are having difficulty paying workers. Reports circulated in Beijing suffered a heart attack in April and underwent a long convalescence. The unusual public criticism of the previous regime at the Central. Bank indicates that below the, surface, the leadership has been engaged in some stirring argument about the implementation of Mr Zhu's austerity package. Early in July, Mr Zhu announced a 16-point plan to combat inflation and bring order to China's chaotic finances.

Pressure was also exerted on faltering State industries by squeezing available credit UK tells China to step up talks NZ rivals told not to draw in G-G By DAVID BARBER Herald Correspondent WELLINGTON. Thursday: The leader of New Zealand Alliance, Mr Jim Anderton, a key figure in the political impasse since Saturday's general election, today urged his political rivals to decide on the new Government if Parliament remained deadlocked without having to rely on the Governor-General, Dame Catherine Tizard. "I think the less the Governor-General is asked to do in this matter, the Mr Anderton said after his first meetings with the Prime Minister, Mr Jim Bolger, and the Labour Party Leader, Mr Mike Moore, since the election returned a hung Parliament. Mr Anderton said: "We're trying to work this through so that we don't present the Governor-General with a problem. Parliament should sort it out." A continued stalemate without a party agreement would put Dame Catherine in an invidious position.

Appointed by a Labour Government, she was a Labour Mayor of Auckland, is divorced from a former Labour Cabinet minister and is the mother of a re-elected Labour MP. It will be another week before special votes are counted and the country knows whether Mr Bol-ger's National Party or Labour will have enough seats to lead a minority government. The Alliance won a crucial two seats to share the balance of power on election night with Mr Winston Pcters's New Zealand First party, which also won two. Mr Anderton said the Alliance would not bring down either a National or Labour government on a vote of confidence under any circumstances, but added: "There will be no deals, no coalitions, no trade-offs on policy. The party with the most seats will have the right to form a government, and we'll not frustrate that." Mr Peters has declined to meet the other three leaders, saying party discussions are "premature" while the election outcome is uncertain.

By PETER ELLINGSEN Herald Correspondent LONDON, Thursday: Britain plans to intensify its negotiations with China in an llth-hour bid to settle differences over the future of Hong Kong. With just weeks left before a decision must be made on the shape of elections in the colony, the Foreign Secretary, Mr Douglas Hurd, made it clear that Britain believed more meetings were needed if progress was to be made. "We're proposing a move into a more intensive phase straightaway," Mr Hurd said after a Cabinet meeting yesterday chaired by the Prime Minister, Mr John Major, and including the Hong Kong Governor, Mr Chris Patten. Alluding to the tough Chinese stand that has seen the talks bogged down over 15 inconclusive meetings since April, Mr Hurd said a "lot more progress is needed" if differences were to be resolved. There had been "some movement" on the British side and less on the Chinese side, he said, adding that Britain wanted China to deal first with questions that were close to settlement before facing the harder issues.

The major sticking points centre on what sort of electoral system will be in place when China resumes control of Hong Kong in 1997. Beijing has opposed a plan by Mr Patten to extend the present franchise to municipal elections next year and to a poll for the Legislative Council in 1995. China claims the plan contradicts an agreement on the handover of power. The impasse, in which China has threatened to dismiss councillors elected under the Patten formula, has meant crucial decisions, such as approval for Hong Kong's new airport and expansion of its container port, have been put on hold. According to Mr Patten, Beijing's refusal to deal with matters before the Joint Liaison Group, a Sino-British diplomatic forum negotiating the details of Hong Kong's transfer to China, "risked vital legal and commercial relations with the Should Britain choose to push ahead with Mr Patten's proposals, there is likely to be difficulty getting approval from the Legislative Council, which seems split between the Democrats, who won a landslide victory in the first direct elections for 18 seats in 1991, and conservatives linked to Beijing.

Mr Chris Patten, left, and Mr Major shake hands before addressing a conference in London on doing business in Hong Kong. Mr Patten is in London for consultations on how to break the deadlock in talks with China on the colony's future. Picture by reuter Soeharto to attend AFEC summit of the group and said he would not attend it. The Australian Prime Minister, Mr Keating, met President Soeharto here two weeks ago to encourage him to attend the Seattle summit. The Singaporean Prime Minister, Mr Goh Chok Tong, a strong backer of APEC, was also here this week for the same reason.

President Soeharto's long-awaited decision on going to Seattle was announced last night by the State Secretary, Mr Moerdiono. The APEC leaders' summit will By TERRY FRIEL JAKARTA, Thursday: Australian hopes of widespread support for upgrading the Asia-Pacific Economic Co-operation (APEC) group have been boosted with the announcement that Indonesia's President Soeharto will. attend the leaders' summit in the United States next week. President Soeharto, who assumes the chair of APEC next year, rules South-East Asia's largest country and is widely regarded as the region's elder statesmaa His support for the leadership summit and an enhanced role for APEC is critical to securing widespread backing from the South-East Asian countries, which make up almost half of the 15-strong membership. The President's backing is also seen as important in countering fears that the group is being hijacked by its Western members, particularly Australia and the US.

After the US President, Mr Bill Clinton, unilaterally announced the Seattle summit, the Malaysian Prime Minister, Dr Mahathir Mohamad, accused the West of stealing control discuss the future development of the grouping, including an Australian proposal to change the name to Asia-Pacific Economic Community. Mexico and Papua New Guinea were likely to be admitted to APEC next week but not Chile, a senior US official said in Washington yesterday. The US Undersecretary of State for Economic and Agricultural Affairs, Ms Joan Spero, said there appeared to be a consensus among the 15 APEC members on Mexico and Papua New Guinea. Australian Associated Press, Agence France-Presse Mow yoer onasasies Singapore to beam TV programs out but not in 'benefit from By LINDSAY MURDOCH Herald Correspondent SINGAPORE, Thursday: Singapore has decided to enter Asia's crowded satellite television broadcasting competition with an hour-long service starting In January. But the city-State, which imposes strict censorship, will continue to ban its 3 million people from putting up satellite dishes for overseas services.

Homes from Shanghai to Darwin will be able to receive the new service, to be known as Singapore International Television. Several bigger satellite services are vying for Asian viewers, including the Rupert Murdoch-controlled Star TV, CNN International, the Dow Jones-controlled Asian Business News and the ABC-run Australian Television International. Singapore's predominantly English news service will be launched on Indonesia's Palapa, the same satellite that carries Australian Television International. Singapore's Minister for Information and the Arts, Mr George Yeo, said yesterday that introducing the service was one way to cope with increased competition from television broadcasting. The service was aimed at Singaporeans living overseas and friends of Singapore in the region, he said.

Singapore is working on a plan to enable every household on the island to receive 100 cable channels, which Mr Yeo said would reduce the desire for satellites. The Government would be able to cut out channels that carried pornographic or violent programs. the new 10 Self-rule for Palau 4 4 Investment 4 4 4 4 4 4 4 Allowance? IWC IWC watches of Switzerland. Full range at HBs. Priced rrom 2200.

HARDY TvW BROTHERS JEWELLERS 4 4 In more than 50 per cent of the vote but never the required 75 per cent However, last year, a constitutional amendment was approved requiring the pact get only a simple majority for passage. Under the pact, the US military can operate on Palau in a crisis and open two military bases. It would be responsible for Patau's defence, and other countries would be denied military access to the region. The US would also clean up nuclear or toxic accidents in its waters. Nuclear, biological and chemical warfare materials would be prohibited.

Palau is a collection of 200 volcanic islands, the westernmost cluster of six major groups making up the Caroline Islands. It is about 800 kilometres east of the Philippines. Associated Press KOROR, Palau, Thursday: Residents of this western Pacific archipelago voted yesterday to approve self-rule and endorse a political, economic and military pact with the United States. With about 47 per cent of the votes counted and the margin widening, the "yes" vote was 3,225 (64 per cent) and the "no" vote 1,793 (36 per cent). Palau, a series of islands with a population of 15,000, is the last remaining United Nations trust territory.

As the island's trustee, the US has administered its affairs. The Compact of Free Association allows Palauans self-rule and provides nearly SUS450 million (SA677 million) in US economic aid. The 50-year pact has failed in seven plebiscites since 1983, always getting 4 4 77 Castlcrcieh Street Sydney iiiiiltcA le Avenue 1 Jonble li.iv 4 4 4 4 4 4 4 I tfif 1h WvVt VEHICLE SAFETY RECALL Mazda Australia Pty Limited, is recalling vehicles in the current 626 Model range to have both headlight wiring harnesses reworked. The vehicles affected fall within the vehicle indentification number (VIN) range and the manufacturing period listed below; 1. 626 V6, JMO GE10L1 00100001 to JMO GE10L1 00133086 Novembers, 1991 to May 25, 1993.

2. 626 4 Cylinder, JMO GE10S1 00100001 to JMO GE10S1 00133086 November 12, 1991 to May 25, 1993. The VIN number is located under the bonnet on the rear panel (firewall) of the engine compartment, and in the warranty information booklet on page five (5). The subject Safety Recall Campaign is effective as of this date. Condition The possibility of a wire in one of the headlight wiring harnesses shorting to earth, may cause a fuse to blow.

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