Extracts.

                     Thursday, December 28, 2000, updated at 09:12(GMT+8)


                       Mideast Summit Cancelled -- Egyptian Source

                       Thursday"s planned summit between Israeli Prime
                       Minister Ehud Barak and Palestinian President Yasser
                       Arafat in the Egyptian Red Sea resort of Sharm
                       el-Sheikh has been cancelled, an Egyptian government
                       source said. "The meeeting will now just be between
                       Arafat and (Egyptian President Hosni) Mubarak and it
                       will be in Cairo," he told Reuters. He declined to
                       give further details.

                       The meeting had been intended to discuss U.S. peace
                       proposals for resolving issues at the heart of the
                       conflict between Israel and the Palestinians, such as
                       Jerusalem, Jewish settlements and Palestinian
                       refugees.

****
                       Thursday, December 28, 2000, updated at 08:10(GMT+8)


                       Preferential Policies on West Development Adopted

                       China is set to adopt more preferential policies for
                       the development of its western region in the next
                       decade, according to a circular released Wednesday,
                       December 27, by the State Council.

                       The incentives cover increased government input,
                       fiscal support, tax cuts and policies to attract
                       investors.

                       The beneficiaries will be the 12 provinces,
                       municipalities and autonomous regions of Chongqing,
                       Sichuan, Guizhou, Yunnan, Tibet, Shaanxi, Gansu,
                       Ningxia, Qinghai, Xinjiang, Inner Mongolia and
                       Guangxi, says the circular.

                       In the next five to ten years, China will step up
                       infrastructure construction, improve environmental
                       protection, readjust the industrial structure and
                       develop tourism in the western areas, it says.

                       The government will allocate more fund to the region,
                       give priority to construction of infrastructure
                       projects in water conservancy, transport and energy
                       sectors there.

                       According to the circular, work will be done to
                       create a better environment to attract investment,
                       both domestic and overseas, to push forward the
                       reform of state-owned enterprises in the western
                       areas and promote the development of the private
                       sector.

                       The government will cut the rate of enterprise income
                       tax to 15 percent for both domestic and
                       overseas-funded companies engaged in industries
                       encouraged by the state for a certain period of time.
                       Preferential tax rates will also be available for
                       projects concerning transport, electricity, water
                       control, postal, broadcasting and TV services, as
                       well as environmental protection.

                       The country will also give investors incentive
                       policies toward the use of land and mineral resources
                       in the region, says the circular.

                       More sectors will be opened to foreign investors and
                       measures including BOT and TOT will be introduced to
                       expand the source of foreign capital.

                       To expand foreign trade in the western areas, more
                       industrial enterprises will be given import and
                       export autonomy, and more preferential policies will
                       be provided to encourage border trade, according to
                       the circular.

                       The government will encourage the economically
                       developed eastern coastal areas to give more support
                       to the west.

                       Measures will be taken to attract more talented
                       professionals to work in the western region and boost
                       the development of education, science and technology
                       there.

                       The new polices will be effective as of January 1,
                       2001 and through the next ten years.

****

                       Thursday, December 28, 2000, updated at 11:15(GMT+8)


                       China Has Built up a Complete Ocean Supervision
                       Contingent

                       The East China Sea Head Corps of China Ocean
                       Supervision Contingent, as the third regional corps
                       following the two in Beihai and the South China Sea,
                       was formally established in Shanghai December 26,
                       marking the complete establishment of an ocean
                       supervision troop in the country.

                       The East China Sea Head Corps will function in the
                       inner seas, the territorial waters, the continental
                       shelves in the marine belts of the special economic
                       zones, that stretch from Shao'antou at the adjacent
                       area of Fujian and Guangdong provinces in the south
                       to the juncture of Jiangsu and Shandong in the north.

                       The corps will impose punishment to any behavior in
                       violation of China's marine interests, illicit use of
                       the maritime space and damaging marine environment
                       and resources in accordance with relevant laws and
                       regulations. They will help law-execution on the sea
                       or participate in maritime salvation and other
                       actions for military safeguards as committed and
                       authorized by relevant departments.

                       Ocean, also known as "blue territories", is of great
                       economic and strategic importance. Since China
                       launched the policy of reform and opening up, the
                       marine industry has witnessed a rapid development and
                       become a new growth point in the national economy.
                       Statistics show that in 1999, the gross production
                       value of China's marine industries reached 360
                       billion yuan with 200 billion yuan added value
                       achieved, taking up 2.4 percent of the GDP.

                       Zhang Hongsheng, vice director of State Oceanography
                       Bureau, said that the Chinese Government published
                       and effected the Protection Law of Marine Environment
                       of the People's Republic of China in the early 1980s,
                       followed by a series of laws and regulations for the
                       protection of the Chinese ocean. In 1983, the Chinese
                       Ocean Supervision Contingent formally began to cruise
                       in execution of the laws within the Chinese
                       seawaters.

                       Since July 1999, the Headquarters of China Ocean
                       Supervision Contingent and regional head corps have
                       been set up one in the wake of the other. In the
                       meanwhile, the coastal provinces and municipalities
                       and autonomous regions also have their own ocean
                       supervision troops built up.

                       By PD Online Staff Deng Gang


****

Iran-Russia Military Cooperation to Be Expanded Russian Defense Minister
Igor Sergeyev has said that Tehran and Moscow will expand their military
and security cooperation despite opposition from the United States, the
Islamic Republic News Agency (IRNA) reported Wednesday, December 27.

"Iranian-Russian military cooperation will not be to the prejudice of any
third country," Sergeyev, who arrived here late Tuesday for a three-day
visit, was quoted by the agency as saying.

Leading a high-ranking military delegation for the first such visit to Iran
since the country's 1979 Islamic revolution, Sergeyev said his trip aims to
bolster the arms trade between Moscow and Tehran, despite U.S. threats of
economic sanctions.

He expressed hope that his visit would initiate a new chapter in
Iran-Russia relations and serve improvement of cooperation for security and
stability in the region.

"Moscow calls for expansion of relations with Tehran in all fields, notably
regional security, and there is no legal and international obstacle before
this intention," Sergeyev said upon his arrival.

Sergeyev is to hold talks with President Mohammad Khatami, Defense Minister
Rear Admiral Ali Shamkhani and other senior military and political
officials on military cooperation, the Afghan crisis, the legal status of
the Caspian Sea, the Middle East crisis and other issues of common concern.


He is also to visit the bases of Iran's aerospace industry, electronic
industry and some military installations.

According to the IRNA report, Sergeyev declined to comment on Washington's
opposition to Russia's dealings with Iran, only saying that "Russia will
not contravene international agreements."

Moscow announced in November that it would stop the observance of a
five-year-old accord with Washington which banned Russia from selling arms
to Iran. The decision prompted a US threat of economic sanctions.

But Moscow has sought to allay Washington's fears at the resumption of arms
deals between Russia and Iran, saying that under no circumstances would
Russia help Iran manufacture weapons of mass destruction.

****

Yearender: World Situation: Relatively Calm in 2000 As the last year of the
20th century is drawing to a close, people can breathe a sigh of relief:
the world situation in 2000 has been relatively calm, without witnessing
flames of war of the magnitude of the Kosovo conflict in 1999.

And the outgoing year also saw no financial turmoil like the one which
flared up in Southeast Asia in 1997 and had repercussions all over the
world.

Nevertheless, the world is far from tranquil and is by no means a heaven
free from concerns and apprehensions.


BIG POWERS' RELATIONS: MORE COOPERATIVE
The relations between Russia and the United States and those between Russia
and Europe suffered a serious setback in 1999 following the bombardment of
Yugoslavia by the US-led NATO, which dented Russia's strategic sphere. But
after Vladimir Putin assumed the Russian presidency at the beginning of the
year, the US and some of its European allies seized the opportunity by
making conciliatory gestures. Putin responded by adopting a series of
fence-mending diplomatic moves, putting these damaged relations back on
track.

With regard to the Russia-Japan relations, while no solution to their
long-running territorial dispute is in the offing, headway has been made in
trade and economic cooperation between the two countries during the year.

The China-US relations, which plummeted to rock bottom when the US-led NATO
launched a missile attack on the Chinese embassy in Yugoslavia in May last
year, were back on track again after more than one year of efforts.

U.S. President Bill Clinton signed a bill into law in October on granting
permanent normal trade relations status to China, which is in keeping with
the common interests of the two peoples and is conducive to the steady
development of Sino-American relations.

The strategic partnership between China and Russia was further strengthened
and elevated in 2000, while China made further progress in the development
of its relations with the European Union and Japan, as both sides followed
the principle of seeking common grounds while reserving differences.

And the alliance between the US and the EU and that between the US and
Japan remained firm despite repeated frictions over trade issues.


WORLD CONTINUES MOVING TOWARDS MULTI-POLARITY The US continued to seek its
absolute supremacy in world political, economic and military spheres, but
its wanton ambition for a unipolar world was reined in, as the majority of
countries in the world, including big powers, have voiced their strong
opposition against it.

China and Russia are among those countries striving for the
multi-polarization of the world. Even some of Washington's Western allies
also, openly or privately, rejected the idea of a unipolar world which
features the dominance of a sole superpower, and

called for a multi-polar world. In the face of public wrath in the world,
Washington was forced to shelve its plans for a national

missile defense system.

The US pokes into international affairs anywhere in the world only to see
its hands getting weak. For example, to Washington's great embarrassment,
one country after another opened commercial and transportation links with
Iraq in the course of the year, in defiance of the sanctions strongly
advocated by the US and Britain.

Washington once boasted that the war in Kosovo had set a "precedent" for
its neo-interventionism, but later had to modify its remark by saying that
the Kosovo mode was not a "precedent" but a "special case."


REGIONAL TENSIONS OVERALL REDUCED
Regional conflicts and hot spots largely calmed down in the year 2000. The
situation on the Korean Peninsular, which had been gripped by hostility
over half a century, experienced a breakthrough in mid-June when the top
leaders of the north and the south of the peninsular held a historical
summit in Pyongyang declaring an end to confrontation and the arrival of a
new era of reconciliation and cooperation.

The two sides then took practical measures to facilitate contacts, exchange
and cooperation in various fields. Difficulties and twists may lie ahead,
but the general trend of reconciliation on the peninsular cannot be
reversed, political analysis say.

The situation on the Balkans became more stable. The efforts of the new
leaders of the Federal Republic of Yugoslavia for the country to return to
the international community met positive responses. In South Asia, the
dispute over the Kashmir issue between India and Pakistan remains
unresolved, while in Africa, some war-torn countries have seen the dawn of
peace.

The Mideast peace process experienced violent ups and downs this year.
Bloody clashes between Palestinians and Israelis since September served to
interrupt the peace talks which had already reported some progress.

But the situation in the Middle East as a whole is not getting out of
control and the blood-letting is unlikely to develop into a large-scale
regional conflict, for both Palestinians and Israelis -- leaders and
ordinary people alike -- are loath to see a return to an era of war and
terror.

The US also wants the two sides to end clashes and continue the peace
talks. The international community has been making efforts to mediate
between the two sides to help reopen the peace talks between Palestine and
Israel.


ROBUST GROWTH IN WORLD ECONOMY, RICH-POOR GAP WIDENS Most countries and
regions in the world recorded faster economic growth in the year. The
International Monetary Fund predicted that in 2000, the world's economy
would grow by 4.7 percent, the highest in the last 10 years. Developed
countries would register a growth of 4.2 percent, developing nations 5.6
percent, Europe 3.5 percent, Asia 6.7 percent, Africa 3.4 percent, and
Latin America and the Caribbean 4 percent. And what is noticeable is the US
economy has registered growth for a record 117 consecutive months by the
end of 2000.

Despite the development of the world economy, the disparity between rich
and poor countries is becoming wider. According to World Bank statistics,
low-income countries account for more than half of the world's population,
but their combined GDP is only 6 percent of the world's total. In contrast,
developed countries account for only one-sixth of the world's population
but have 80 percent of the global GDP.

The rapid development of information technology also contributed to the
widening gap, including the so-called "digital divide," between developing
and developed countries. To basically reverse the trend, concerted efforts
from both developing and developed countries are needed to change the old
unjust and inequitable international economic order and to replace it with
a new international economic order based on equality, cooperation and
common development.

The world is on the threshold of the 21st century. People have every reason
to believe that in the coming new year, the world situation will continue
to demonstrate a trend of overall relaxation with regional turbulence, and
the prospects of the world economy will remain as good.


****
                       Tuesday, December 26, 2000, updated at 20:19(GMT+8)


                       Li Ruihuan on Issues Concerning HK, Macao, Taiwan,
                       and Overseas Chinese

                       Li Ruihuan, chairman of the National Committee of the
                       Chinese People's Political Consultative Conference
                       (CPPCC), reiterated the importance of the issues
                       concerning Hong Kong, Macao, Taiwan, and overseas
                       Chinese.

                       While meeting with delegates attending a national
                       conference on the issues Tuesday, December 26, Li
                       said the issues will play an irreplaceable, important
                       role for China to accomplish its three major tasks in
                       the new century.

                       The three major tasks are to continue the country's
                       modernization drive, realize the reunification, and
                       to safeguard world peace and promote common
                       development, said Li.

                       The conference was sponsored by the Subcommittee for
                       Hong Kong, Macao and Taiwan Compatriots and Overseas
                       Chinese of the CPPCC

                       National Committee. The participants shared their
                       views and experience in handling matters of concern.

                       Vice chairmen of the CPPCC National Committee Sun
                       Fuling, Wan Guoquan, Luo Haocai and Zhang Kehui
                       attended the meeting.




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