HEFEI OFFICIALS PAINT OPTIMISTIC PICTURE OF PROGRESS IN

UNCLAS SECTION 01 OF 04 SHANGHAI 000209

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SUBJECT: HEFEI OFFICIALS PAINT OPTIMISTIC PICTURE OF PROGRESS IN
LEAST AFFLUENT PART OF CONSULAR DISTRICT

SHANGHAI 00000209 001.2 OF 004



1. (U) Summary. As part of Consulate efforts to scale up
outreach to Anhui Province, the least affluent part of our
consular district, the Consul General and Pol/Econ chief visited
the provincial capital of Hefei April 8-9. During the visit,
the Consul General met with Governor Wang Sanyun and Provincial
Foreign Affairs Office officials and raised IPR concerns with
the Hefei Mayor and municipal investment promotion officials.
The Governor and Provincial Tourism Bureau officials noted hopes
for increased tourism to Anhui from the 2010 Shanghai Expo;
environmental officials detailed progress on water quality
issues, and education officials admitted that recruitment and
retention of qualified teachers remains a serious challenge in
the Anhui countryside. The CG also spoke to students at Anhui
University and visited the Anhui Children's Welfare Institute
and the Chinese Academy of Sciences' Institute of Plasma Physics
(IPP). Septels will report on Deputy Principal Officer's Hefei
meetings and activities in late April. End summary.


Governor: Building Infrastructure for Better Tomorrow

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2. (U) The Consul General, Pol/Econ Chief and Consulate
interpreter visited Hefei April 8-9. Governor Wang Sanyun
painted reasons for economic optimism in Anhui, saying that
China's economic stimulus plans will bring another 3,400
kilometers of rail lines - all high-speed - to the province over
the next several years, with electrification upgrades planned
for another 1400 kilometers of existing rail lines.
Hefei-to-Beijing travel will be less than three hours by rail
within three years. A new international airport for Hefei has
broken ground in a western suburb, and should be operational in

2011. Anhui has lagged its neighbors in economic growth for
many years, the Governor noted, but a new period of opening up
for Anhui has dawned, and the prospect of resolving
transportation bottlenecks through expansion of rails and
improvements to waterways and roads means Anhui can overtake its
neighbors and promote regional economic integration and
globalization.



3. Anhui shipped 10 billion kilograms of grains to other parts
of China in 2008, Wang boasted, and the leading provincial
industries of construction materials and cement should fare well
under the economic stimulus plans. Natural resources - scenic
mountains, coal and limestone - and abundant labor, strong
engineering talent emerging from universities and national-level
research institutes, and development of tourism, amusement parks
and a nascent cartoon industry mean bright future prospects for
Anhui. First-quarter economic data had already shown signs of
an economic rebound, with provincial power generation climbing
15.6 percent and power consumption growing 7.7 percent. (Note:
Anhui was one of the provinces hit hard by January-February 2008
snowstorms, which inter alia damaged the electricity
distribution network. End note.) First-quarter fiscal revenue
had climbed about six percent year-on-year, while industrial
output had climbed more than 17 percent.


Hefei Mayor: Welcome More U.S. Investment, IPR Important

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4. (U) Hefei Mayor Wu Cunrong noted that the rail improvements
will connect Hefei and Shanghai in two hours travel time 25
times per day by August 2010. The Mayor expressed particular
hope for additional U.S. business and U.S. Government activities
in Hefei and the province on environmental protection, cultural
activities and scientific and technological undertakings. Anhui
companies represent an important market for energy efficiency

SHANGHAI 00000209 002.2 OF 004


technologies from abroad.



5. The Mayor quickly and enthusiastically endorsed our
recommendation that Hefei or the province should publish a White
Paper on intellectual property rights (IPR) protection and
enforcement as part of efforts to attract new foreign direct
investment and protect the legitimate interests of the more than
3000 foreign-invested enterprises already in Hefei. He
instructed Hefei Investment Promotion Bureau Director Mr. Lan
Tian to make follow-up inquiries to relevant local offices about
early preparation of an IPR White Paper.



Tourism Potential Recognized

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6. (U) Anhui Provincial Tourism Deputy Director General Zhang
Xueping outlined plans to promote more `green tourism' to
Anhui's scenic mountain areas and ancient villages; `red
tourism' to sites associated with the Communist Party's rise to
power, and `blue tourism' to Anhui's lakes and rivers (including
more tourism along the Yangtze River and connecting to
destinations in neighboring jurisdictions). Tourism officials
are working with local tour operators and the hotel and
hospitality industries to also develop rural tourism
(bed-and-breakfast on farms, pick your own produce) and even
tourism, especially by student groups, to industrial sites such
as advanced or historic factories.



7. Thrice-weekly flights between Hefei and Seoul were launched
in March 2009 to bring businesspersons and tourists from South
Korea to Anhui; the province hopes to someday land flights from
European cities as well. Tourism has become a pillar industry
for Anhui, providing 8.3 percent of the province's GDP in 2008.
The Tourism Bureau has an ambitious target for attracting a
substantially increased number of tourists to Anhui during the
Shanghai 2010 Expo (May 1 - October 31, 2010),although final
details of cooperative tourism promotion are still being worked
out with the Shanghai Tourism Bureau.


Teacher Supply a Continuing Challenge, However

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8. (U) Anhui Provincial Education Department Director-General
Cheng Yi, a former university mathematics professor, noted that
Anhui suffers from a chronic shortage of teachers for grades
1-9. The shortage is uneven within the province, with some
small remote villages having only one teacher for all grades,
far too few teachers in the more populous countryside in
northern Anhui, and a better situation in most cities. The
Central Government and local communities are providing salary
subsidies to recruit more college graduates to teach in
villages, an expansion of a successful program already
undertaken in western China for three years and now expanded to
Anhui and other central China provinces.



9. The global financial crisis and difficulties in job
placement may prove a boon to hiring more qualified teachers in
the short term, DG Cheng hopes. Even so, 3-5 years of hiring
more and better quality teachers will be required for Anhui to
get its compulsory education system more regularized. Higher
teacher salaries (a responsibility of local governments) are the
key to resolving the quantity and quality of teachers.


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10. (U) Two million of Anhui's nine million students are sons
and daughters of migrant worker parents who spend most or all of
the year in other provinces in China. Those left behind are
usually cared for by grandparents, too often without sufficient
family reinforcement of the importance of education, Cheng said.
Some unemployed returned migrant workers have brought their
children back with them to Anhui, leading to new challenges
about reintegrating children into local schools. Even before
the economic downturn, expenditure of RMB 2.1 billion was
planned over a two-year period to rebuild many primary schools
in Anhui, with the quality of school construction guaranteed.
Anhui is keen on developing more English instruction programs
for schoolchildren and on expanding cooperation projects with
U.S. educational institutions.


Water Quality an Urgent Challenge

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11. (U) The CG also called on the Provincial Environmental
Protection Bureau. Chief Engineer Zhang Zhiyuan said water
quality is the most urgent pollution problem facing Anhui, but
numerous wastewater treatment plants are under construction and
important progress has been made in reducing pollution
discharges. Indeed, the goal of new pollution control efforts
is to prevent future pollution, especially treatment of
industrial and urban domestic wastewater, not on remediating
extant pollution problems.






12. (U) In a province that still has 26 percent forest cover,
ten Anhui cities score worrisome marks for the incidence of acid
rain, some of which is caused by locally-emitted pollutants and
some by pollutants blown in from elsewhere. Perfection of the
`local government responsibility evaluation system' (i.e.,
making promotion of government officials and Communist Party
cadre more dependent on meeting environmental protection work
requirements) will be a crucial factor in meeting environmental
protection goals. Continuing public education on the concept of
environmental protection is another important step in moving
from today's situation to better environmental quality in the
future. Chief Engineer Zhang noted that even in Anhui, people
are demanding environmental quality improvements for the welfare
of the people.


Tokamak: What Bilateral Scientific Cooperation Can Be

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13. (U) Institute of Plasma Physics (IPP) Director Professor
Li Jiangang led the CG on a tour of the Experimental Advanced
Superconducting Tokamak (EAST) research fusion reactor outside
Hefei. Chinese scientists at this major research institute (460
staff, 100 contractors, about 500 Masters and Ph.D. students
now) have been collaborating with U.S. scientists since 1982,
including with the University of Texas at Austin, the Princeton
Plasma Lab, UCLA, UC-San Diego, and General Atomic of San Diego.
Cutting edge research there could lead to an operational fusion
reactor in another 30 - 50 years, Professor Li estimated.



14. (SBU) Modern telecommunications allows remote monitoring
and control of tokamak experiments around the clock by three
shifts, one in Anhui, another in Europe and one in the United
States. However, this extensive record of productive high-level
bilateral scientific collaboration is dimmed, Li said, by the
unpredictable and lengthy administrative processing times (i.e.,
stateside multiagency processing of Security Advisory Opinions)

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for the visas that IPP scientists and staff need to meet their
scientific partners or to attend scientific conferences in the
United States. As an example, Li told us that he had applied on
February 9 for a U.S. nonimmigrant visa to attend a March 12
meeting in the United States; as of April 9 his application was
still awaiting a Washington reply.


Students and Orphans

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15. (U) The CG spoke at Anhui University about the changes
seen in the U.S.-China relationship since diplomatic relations
were normalized in 1979. 480 enthusiastic students listened
raptly and embraced the opportunity to pose questions about the
economic downturn, U.S. perceptions of human rights in China,
employment prospects for their stateside peers, and how soon
President Obama might visit China.



16. (U) We also visited the Anhui Children's Welfare
Institute, home to about 500 orphans, about 90 percent of whom
have mental or physical challenges. This orphanage is an
important source of orphans placed in domestic and international
adoptions, including to the United States; and the orphanage
receives important financial assistance from the
California-based `Half the Sky Foundation'. The visit was an
opportunity to underscore the benefits of people-to-people
engagement and the constructive role U.S. NGOs can play in
China. Many preschool orphans greeted us warmly, while grade
school orphans were returning from the local elementary school
and getting to work on that day's homework.


Comment

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17. (U) Anhui is home to some of China's most spectacular
scenery (Huangshan National Park) and remote impoverished
communities, and a provider of millions of migrant workers to
other parts of China. The province also boasts important
automotive industries, cultural and performing arts, and the
ancestral homes of several current and past top members of the
Communist Party of China. The recognized need for improved
environmental protection and the eagerness for increased
engagement with the United States in business and investment,
education, pollution control and other sectors make Anhui a rich
target for increased Consulate outreach and reporting travel.
Consulate is forming a dedicated transformational diplomacy team
focused on Anhui to structure and guide that increased outreach.
CAMP