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RUSSIA Special Report: The long arm of the state
RUSSIA
The long arm of the state
Nov 27th 2008
From The Economist print edition
The financial crisis may lead to renationalisation by stealth
EVEN to someone who has never been to Yekaterinburg, a large industrial city in the Urals, the changes are obvious. Shiny towers of metal and glass have shot up everywhere without order or design, pushing aside historic buildings and making the Soviet-era apartment blocks look even grimmer. At night cranes are lit up like Christmas trees. At eight in the morning heavy traffic, mostly of foreign-made cars, chokes streets that still bear Soviet names. The city’s ultra-modern airport makes Moscow’s look shabby.
Yekaterinburg, traditionally the centre of the mining and metal-bashing industry, is a microcosm of Russia’s economy. Until recently it has been flush with money, mostly from natural resources and cheap credit, spent in sprawling supermarkets, restaurants and car dealerships. Oil, gas and metals make up around 80% of Russia’s exports, and until recently their prices were rising fast. For the past five years the economy has been growing at about 7% a year. Measured in dollars the rise has been much faster. Some of this money has been stashed away into a stabilisation fund, but a large portion has been fuelling an unprecedented consumer boom. Real incomes have more than doubled since 1999 and the growth in retailing has averaged 12% a year.
In a country so long starved of good restaurants, hotels and shops, it was natural that consumers should take a lead role, says Andrei Illarionov, a former economic adviser to Vladimir Putin and now one of his fiercest critics. Besides, there is so much uncertainty around that most people would rather spend than save.
But there has been plenty of capital investment too, though mostly in extractive industries. Fixed investment last year rose by a record 21% on the year before, although it remains relatively low.
Private initiative, freed up by the market reforms of the 1990s, became the main force behind Russia’s economic recovery after the 1998 crisis. Growth was particularly strong in sectors that were not weighed down by any Soviet legacy, such as mobile telecoms. But private ownership was also transforming Soviet-era behemoths.
Proud to be private
One example is Uralelectromed, a large copper producer in the Urals, which is partly owned by Andrei Kozitsyn. In the past five years the company’s revenues have tripled. It has used the money to install a new production line, along with the latest American equipment. To add value, it has begun to produce high-quality wire, which it exports to Europe. “We had to be competitive, otherwise we were meaningless,” says Mr Kozitsyn. Having started as a worker in the factory, he rose to the top because he wanted to be in business. But these days, he says, young people prefer bureaucratic careers.
Tax revenues from his industry provide about 40% of the Ural region’s budget. But the government has used the money to pay higher salaries to its employees, recruit more of them and renovate offices rather than build new roads and railway lines, which companies like Uralelectromed badly need.
Crucially, the government failed to use the good times to diversify the economy, clean up its banking system, reform capital markets, strengthen property rights and establish the rule of law. As long as the oil price was going up, nothing that Russia did—from the overt expropriation of Yukos, a giant Russian oil company, to forcing foreign oil companies out of production-sharing agreements—seemed to stop the flow of money into the Russian stockmarket. The job of raising capital was outsourced to foreign banks and capital markets. They lent money to state companies such as Gazprom and Rosneft whose debts were implicitly backed by the government.
This uncontrolled corporate borrowing undid the government’s success at repaying state debt, building up foreign-exchange reserves and setting up a stabilisation fund in which to accumulate some of the oil revenues. At the end of June Russia’s total external debt was $527 billion. Its total reserves in November were $475 billion.
Mr Putin boasted that the net inflow of capital had reached $80 billion last year and total foreign investment had risen to 9% of Russia’s GDP. But only a quarter of this was foreign direct investment; the rest came in the form of loans and portfolio investments. As Kirill Rogov of the Institute of Economy in Transition, a think-tank, explains, this reflected the strength of Russia’s reserves and the weakness of its investment climate. Whereas other emerging economies were fighting tooth and nail for direct investment, Russia was borrowing cheaply instead, he says.
When the world economy started to wobble, the government increased its spending by 40% to boost consumption, says Evgeny Gavrilenkov, chief economist at Troika Dialog, an investment bank. With demand outpacing supply, the Russian economy started to overheat. Inflation topped 15% during the summer. Held back by red tape, the strong rouble and weak property rights, Russian industrial production grew by 5.4% in the first nine months of this year and imports in the same period shot up by 42%. Yekaterinburg is full of department stores, but hardly anything that is sold in them is produced around there. What is made locally is tanks, exports of which did go up last year.
Even as the Russian stockmarket went into a nosedive, Mr Putin insisted that Russia had escaped the financial crisis. On September 13th, in an interview with France’s Le Figaro, he gloated: “We did not have a crisis of liquidity; we did not have a mortgage crisis [like America or Europe]. We did not have it, we escaped it.”
When the music stopped
But when the oil price started to fall, foreign banks stopped lending and money began to flow out of Russia, it became clear that the economy was more vulnerable and more highly leveraged than many investors had wanted to believe. The cranes in Yekaterinburg, and in many other Russian cities, are now standing idle. Production lines have ground to a halt and metal companies and carmakers have begun to sack workers.
The fall in the stockmarket mattered because Russian firms had borrowed heavily against their shares and faced margin calls from their foreign creditors. Mr Illarionov says this is a “standard” credit and liquidity crisis rather than a budget crisis. Compared with many other countries Russia still has plenty of cash, even if its reserves are dwindling at a worrying rate. Leaving aside the recent spending spree, the country’s overall macroeconomic policy has been sensible. For the past eight years the government has been running budget and current-account surpluses. If growth were to slow down to 3% next year, as some analysts predict, that would still be more than in most countries.
Eyevine
All quiet now in YekaterinburgIgor Shuvalov, the first deputy prime minister, puts a brave face on it: “High oil prices corrupted us, inflated our expenditure and distorted our economy. If this crisis had not happened now, by 2011 the quality of credit portfolios would have been much worse. So it is a blessing. Now we can start the real project, to develop domestic industry and the financial sector.”
In essence Russia’s problems are political, not economic. “We have come to this crisis well prepared,” says Yegor Gaidar, a former prime minister and architect of Russia’s post-Soviet economy. “But now we need to stop nationalising companies and cut down on populism. You can make any argument for nationalisation, but when Russia started to nationalise its oil industry production stopped growing.”
Russia may also need to devalue the rouble. The central bank recently allowed it to depreciate slightly against a basket of currencies, but it still intervenes in the market to defend it. Politically a strong rouble has become a proxy for a resurging Russia and devaluing it or letting it float would hurt Mr Putin’s reputation.
As Mr Rogov explains, it would do no harm if Russia’s highly leveraged oligarchs were to hand over their stakes to foreign creditors, but the Kremlin would not allow this. The risk is that instead of clearing the system and promoting the most efficient firms, the crisis is helping the least efficient. The government is already introducing protectionist measures.
“The crisis itself is less grave than the potential consequences of the government’s actions in solving it,” says Andrei Sharonov, a former deputy economics minister who now works in the private sector. The government has earmarked a total of more than $200 billion for various rescue measures, which as a proportion of GDP is almost three times what the Americans are spending. But in contrast to America, there is little public scrutiny of what the money goes on. The first victims to be rescued by the government were two banks said to be closely linked to senior government officials.
To unblock the banking system, the government deposited $50 billion in three banks, two of which are state-linked. The third used to be controlled by Gazprom and is now owned mostly by private individuals. The idea was that the banks would inject liquidity into the system, but in the event they did not lend the money on to other banks, so now the government decides whom they should lend to.
Another $50 billion of the rescue money was earmarked for bailing out “strategic” companies. At the front of the queue were Russia’s largest oil and gas companies, including the state-controlled Gazprom and Rosneft. Igor Sechin, the powerful deputy prime minister in charge of energy, seems to have promised $9 billion of government money to energy companies. Half of it will go to Rosneft, which has a debt of $20 billion that goes back to its controversial takeover of the Yukos oil company. Mr Sechin is also the chairman of Rosneft and, says Mikhail Khodorkovsky, the former boss of Yukos (and now in jail), the man who destroyed his company.
Next came electricity companies, carmakers and anyone else who could think of a good reason to ask for help. As one Russian oligarch observed, a lot of people in the Kremlin would like to take back the companies that were privatised in the 1990s. Back then the oligarchs lent money to the cash-strapped state and got assets at knock-down prices in return. Now it is the companies that are in debt, whereas the state is cash-rich and can buy the assets back cheaply. To make them even cheaper, government officials publicly threaten companies or dig out old charges against them, as Mr Sechin has recently done with one of Russia’s largest fertiliser producers.
The crisis has also changed the behaviour of private firms. In the past the market pushed them to improve their governance, but now they are encouraged to look towards the state, says Roland Nash of Renaissance Capital.
Mr Shuvalov admits that some private assets might end up in state hands, but he insists that the government does not intend to keep them. The question is how, and to whom, these assets will be sold. Nationalising businesses is risky in any country, but in Russia, with its weak institutions and powerful Kremlin clans, it is almost certain to lead to a redistribution of property to the ruling elite, mainly past and present members of the security services, collectively known as siloviki, or hard men.
Neither one thing nor the other
The new entities that could emerge from the crisis may be neither state nor private, says Mr Rogov, but the worst of both worlds: opaque, quasi-state firms run by people affiliated with the Kremlin. One model for this form of ownership is a privately controlled subsidiary of a state-controlled company. Another is something called a “state corporation”.
One example is Russian Technologies, run by Sergei Chemezov, a former KGB officer and a friend of Mr Putin’s from the 1980s when the two served together in East Germany. Until last year Mr Chemezov was in charge of a state arms-trading monopoly, which did not stop him from taking over a successful private titanium business and a car factory. This year his empire, now under the umbrella of Russian Technologies, has grown even further. State corporations’ assets, Mr Chemezov once said, “are neither state not private”; they are “state commerce”.
He has successfully lobbied for the inclusion in Russian Technologies of some 420 mostly state-controlled companies, some of which—such as airlines or property—seem to have little to do with the corporation’s declared aim of promoting technology. Alexei Kudrin, Russia’s finance minister, noted that giving Russian Technologies all these assets would amount to “a covert privatisation and the loss of control over how the proceeds are spent”. But his words fell on deaf ears.
Another state corporation is based on Vneshekonombank (VEB), which is meant to be bailing out Russian firms that need to refinance their foreign debt. The committee that decides on the bail-outs is chaired by Mr Putin himself. VEB has recently lent $4.5 billion, well above its supposed limit, to Rusal, a company controlled by Oleg Deripaska, a Russian aluminium tycoon, so he could repay a foreign loan backed by 25% of Norilsk Nickel, the world’s largest nickel producer. In return VEB will include government officials in the company’s management and board. But even before the crisis Norilsk Nickel’s controlling shareholder, Vladimir Potanin, one of the most politically savvy oligarchs, had put a former KGB officer in charge of the company—to be on the safe side.
The projection of KGB power in Russia’s politics and economy has been a guiding principle of Mr Putin’s period in office. In the past the siloviki often had to rely on tax inspectors or the Federal Security Service (FSB) to get hold of assets. Now the crisis is creating new opportunities for what Mr Illarionov calls the “KGB-isation of the economy”. The result, he explains, could be a new, highly monopolistic system, based on a peculiar state-private partnership in which the profits are privatised by Kremlin friends and debts are nationalised. This will not take Russia back to a state-run economy, but it is likely to shift it further towards a corporatist state.
This Day in History: Japan invades Hong Kong
On this day, in 1941 Japanese troops land in Hong Kong and a slaughter ensues.
A week of air raids over Hong Kong, a British crown colony, was followed up on December 17 with a visit paid by Japanese envoys to Sir Mark Young, the British governor of Hong Kong. The envoys’ message was simple: The British garrison there should simply surrender to the Japanese – resistance was futile. The envoys were sent home with the following retort: “The governor and commander in chief of Hong Kong declines absolutely to enter into negotiations for the surrender of Hong Kong. ...”
The first wave of Japanese troops landed in Hong Kong with artillery fire for cover and the following order from their commander: “Take no prisoners.” Upon overrunning a volunteer antiaircraft battery, the Japanese invaders roped together the captured soldiers and proceeded to bayonet them to death. Even those who offered no resistance, such as the Royal Medical Corps, were led up a hill and killed.
The Japanese quickly took control of key reservoirs, threatening the British and Chinese inhabitants with a slow death by thirst. The Brits finally surrendered control of Hong Kong on Christmas Day.
JAPAN: Top 10 Japan news stories of 2009
The Japan Times' editors picked these events as the top domestic news stories of 2009 based on their significance and impact:
1) Power shift: The Democratic Party of Japan wins a landslide victory in the Aug. 30 election, breaking the Liberal Democratic Party's almost uninterrupted five decades in power.
2) New flu: A new swine flu strain hits Japan, sparking widespread public fears and prompting millions of people to regularly wear surgical masks in daily life.
3) Lay judges: The lay-judge system debuts Aug. 3, ushering in a new age of citizen participation in the criminal trial system.
4) JAL: Japan Airlines Corp., the nation's flagship airline, goes into a financial tailspin, seeking government assistance in order to survive.
5) Freedom: Convicted killer Toshikazu Sugaya, sentenced to life in prison, is released June 4 and is set to be exonerated in a retrial based on a DNA test that effectively cleared him of involvement in a girl's 1990 murder in Ashikaga, Tochigi Prefecture.
6) Apprehended: Tatsuya Ichihashi, wanted in connection with the 2007 murder of British English-language teacher Lindsay Ann Hawker, is arrested in Osaka on Nov. 10 after 2 1/2 years on the run.
7) Drugs: Noriko Sakai, a singer-actress popular in Japan and Asia, is arrested Aug. 8 and later convicted of possessing and using amphetamines, becoming main fodder for the gossip media this year.
8) Economy: The jobless rate hits record highs amid the global economic slump, and the yen's surge in November to 84 to the dollar plagues exporters.
9) Secrets: Alleged, and officially denied, secret diplomatic pacts with the U.S. are key media topics, particularly an accord believed signed in 1969 that allows the U.S. to bring nuclear weapons into Okinawa in an emergency. A copy of this pact turned up Dec. 22.
10) Child custody: Attempts by estranged international couples to retrieve or otherwise take custody of their offspring draw renewed attention when American Christopher Savoie is arrested by Japanese police for allegedly trying to abduct his two children and take them to the U.S. Consulate in Fukuoka on Sept. 28.
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CHINA: Shanghai's World Expo, Oberammergau Passion Play rate in 2010
TRAVEL
The year is a fresh slate before you, so it's time to start filling in those blanks. Here are five ideas for places to be or places to see that will turn your 2010 into a year to remember. And if you have something you think should be on readers' radars, write to us at travel@latimes.com.
Oberammergau Passion Play, Germany
It happens only once every 10 years and has been going on since 1634. The people of Oberammergau in the Bavarian Alps, fearing that bubonic plague would sweep the village, promised they would reenact the Passion every decade if God spared them.
About 2,000 people participate in the production, which runs from May 15 to Oct. 3. They are musicians and costume makers and scenery painters and, of course, the actors who depict the last days of Christ. About a half-million people attend the play, which lasts five hours with a three-hour dinner break.
Tour companies regularly sell excursion packages to the play; you can find a list under "how to book" as well as more about the event at www.oberammergau-passion.com.
-- Catharine Hamm
Inaugural sail of the Queen Elizabeth
We saw the introduction in 2009 of the world's largest cruise ship -- Royal Caribbean's Oasis of the Seas -- and in 2010, we'll see the introduction of what arguably will be the world's most loved: Cunard's Queen Elizabeth.
Like royalty itself, Cunard liners sometimes require a scorecard to keep track of who is who and what is what, so to recap briefly:
The original Queen Elizabeth was launched in 1938 but became a troop ship during World War II, transporting 750,000 troops and sailing a half-million miles. The ship returned to civilian use after the war and was in service as the decline in passenger transport began. It made its final transatlantic crossing as a Cunard liner in the fall of 1968.
By spring of the next year, the Queen Elizabeth 2 had taken over. In 1982, it was called into wartime service again, this time carrying troops to South Georgia Island to fight in the Falkland Islands war. It was refitted and refurbished again (and again and again), and after almost four decades was retired from the fleet. It is owned by the financially shaky Dubai World, and its future remains unclear.
By contrast, the future of the next Queen Elizabeth is crystal clear. The 1,046-stateroom ship is to set sail Oct. 12 from Southampton, England. Cabins may be booked beginning April 2. The inaugural voyage, to Portugal, Spain and the Canary Islands, will begin at $2,995 per person. For information: www.cunard.com.
-- Catharine Hamm
Watching the elk rut in Northern California
Call it sex outside the city. If watching animal courting rituals strikes you as a bit voyeuristic, you've not seen the show Roosevelt elk put on. Think of their antler-locking antics as a sort of fraternity hazing without the beer.
And if that's not enough to lure you, there's the great outdoors to enjoy at Elk Meadow, three miles north of Orick and 45 minutes from Eureka.
Roosevelt elk, the largest of the North American elk, inhabit the Pacific coastal rain forests and mountains. They're kin to deer but larger, graze on grasses rather than legumes and leaves, and communicate more distinctively than deer. The prime time to watch them rutting is early September to the end of October.
Besides elk watching, you can mountain bike, hike or go horseback riding through the redwoods. In nearby Prairie Creek Redwoods State Park, the redwoods are old-growth and virgin trees because the forest has never been logged.
To see the full story, go to latimes.com/elk.
-- Terry Gardner
Total eclipse of the sun
In 2010, see something rare. Machu Picchu? Alaska's glaciers? They'll be around in 2011 (at least, we think they will). How about something more fleeting like, say, a total solar eclipse? It will occur July 12 and be visible from a narrow band of the Southern Hemisphere -- Mangaia in the Cook Islands and Easter Island.
A partial eclipse can be seen in parts of the South Pacific and southern South America.
Shipboard viewing is another option. It's a perfect excuse to take a cruise to French Polynesia. Tours are filling up quickly, so make your travel plans soon. Ring of Fire Expeditions ( www.eclipsetours.com) and Flo USA Inc. (www.eclipsetraveler.com) offer tour packages. The eclipse lasts from two to five minutes depending on your viewing location. If you miss this one, the next total solar eclipse is Nov. 13, 2012.
More info: eclipse.gsfc.nasa.gov/SEpubs/2010/TP214171a.pdf.
-- Jason La
Shanghai world's fair
Think of a world's fair as a cultural Olympics that lasts six months. Prices are better, the airport less jammed. As such, the 2010 World Expo in Shanghai is shaping up as one of the year's best travel events.
The coastal city has always considered itself more cosmopolitan than Beijing. It's upping the ante with $45 billion in upgrades that include better roads and expanded mass transit. New hotels include two InterContinental locations -- the Peninsula and the stylish Hotel Indigo, a boutique property.
So where's the "wow" factor? As with any world's fair, it's all about the pavilions.
Visitors are sure to be drawn to the Saudi Arabia pavilion, which looks like a big gleaming wedding gift. The "moon boat" shape will be surrounded by deserts and seas. Across its roof: 150 date palms. Besides such stunning design feats, more than 100 daily events and performances will take place across several dozen sites. One-day admission is about $24. More info: en.expo2010.cn/.
-- Chris Erskine
Copyright © 2010, The Los Angeles Times
JAPAN: Making soba noodles the easy way
A master shares his easy method for making your own.
By Betty Hallock Reporting from Tokyo and L.A.
At Akila Inouye's Tsukiji Soba Academy in Tokyo, a specially made wooden cabinet has 108 small cubbyholes, each containing a scroll of thick brown or green paper printed with a question. "How to finish the soba dough so that the surface is completely smooth?" "What is the ideal shape of soba cutting knives?" "How difficult is it to mill buckwheat flour oneself?"
The soba instructor's cabinet of questions is emblematic of the nuances of soba-making. Soba, revered in Japan -- especially on New Year's Eve, when it's eaten as a symbol of longevity -- is one notoriously tricky noodle. It's difficult to make well, so that it's supple, lustrous and slurpable, resilient and slightly chewy, with the fresh, earthy flavor of buckwheat.
But there is hope for beginners, an opportunity for the would-be casual soba maker (who isn't steeped in the ways of michi, or strict adherence to tradition) to mix, roll and cut the noodles entirely by hand. It's an easy method prescribed by Inouye, who has studied the intricacies of soba-making for more than 20 years and describes himself as a soba evangelist. Call it "intro to soba"; all you basically need is stone-milled buckwheat flour, a plastic bag, a rolling pin and a sharp chef's knife.
According to the lore of Japanese cooks, it takes three years to perfect the subtle art of turning just buckwheat flour, wheat flour and water into elegant skeins of noodles: one year to learn to mix the dough, the second to learn to roll, and the third to learn to cut the slender noodles by hand. Because buckwheat flour doesn't have any gluten (the matrix of proteins that holds dough together), mixing and kneading soba dough to its precise consistency and smoothness requires experience.
But, Inouye says, there's a big difference between making two servings and making 12 servings, and using his technique, even the uninitiated can make two servings of fresh soba that will be better-tasting than dried, packaged noodles. "Everybody can make fine soba at home," he says.
Inouye opened his school, located near the Tsukiji fish market on the third floor of an office building on a quiet street -- practically in the shadow of Honganji Temple -- in October 2002. After leaving a career as a graphic designer, he hoped to teach aspiring professionals so "they can open [soba] restaurants around the world."
"The main reason is I love soba," says Inouye, who is 56 with salt-and-pepper hair and a gentle face. His students (whom he occasionally commends by saying, "You're a good soba-tician.") are a mix of mostly home cooks and some potential soba masters enrolled in one-day, weekend or four- to six-week courses.
Soba is venerated for its simplicity but is more than the sum of its parts, he says. And each aspect of the process of making soba affects the outcome. The movements of a soba master are exacting.
To make soba the traditional way, Inouye starts with freshly milled flour from newly harvested buckwheat that has been cultivated in cold, arid regions of Japan such as Hokkaido, Aomori, Yamagata or Fukushima. A small mill stands near the entrance of the classroom, its two granite wheels grinding a kernel of buckwheat at a time; it produces only enough flour to make soba for the school's restaurant service, Inouye says.
For New Year's Eve, he'll make 300 servings of soba to give to customers. "Actually, this is not a remarkable amount for a soba maker," he says. "Some people make over a thousand servings for the day."
He mixes the dough (using a ni-hachi, or 2-to-8, ratio of wheat flour to buckwheat flour) in a black lacquer bowl bigger than a baby's tub, swirling the mixture first with his fingertips and then his palms to incorporate all of the water into the flour. "It's most critical so every particle of flour meets the water," he says.
He starts kneading, pressing firmly on the dough with the heels of his hands, making sure the water is absorbed deep into the dough and the final disk of dough feels "smooth as a baby's cheek."
Using a set of four long rolling pins called menbo (his are made of lacquered wood and acrylic) he begins rolling the dough on a cypress board dusted with uchiko, a type of buckwheat flour. The menbo are of varying lengths and diameters and are used in turn at different stages of the rolling process. His hands are curled into fists, the heels of his hands placed on top of the menbo, moving it back and forth as a look of deep concentration settles on his face, his body swaying and feet moving in a complex shuffle and sweat forming on his brow. Soba dough makes you work for it.
He produces a thin, wide sheet of dough, nearly the size of a bath towel and no thicker than a quarter, folds it into eight layers and starts cutting with a tall, thin-bladed steel cleaver called soba-kiri. Keeping the cleaver as upright as possible, he cuts quickly, guided by a board. After each cut, he angles the soba-kiri almost imperceptibly to move the guide across the dough. The knife hits his cutting mat rhythmically; "it should be the sound of horses trotting," he says. And what he ends up with is more than 2,000 identical, perfectly julienned strands of delicate soba -- the final product of a technique that has been honed over decades.
Now, soba the easy way: During a recent visit to L.A., Inouye also demonstrated his method for those who want to try their hand at soba. The key is to make a small quantity so that no special equipment (or years of refined technique) is needed.
Inouye mixes all-purpose and buckwheat flour -- still using the 2-to-8 ratio -- along with some water in a plastic bag. He likes using a plastic bag because it's convenient and helps keep in moisture (you could instead use a bowl). Twisting the bag closed, he starts squeezing it to combine the flour and water thoroughly. He removes it from the bag and begins kneading.
The type of buckwheat flour you use is paramount to the success of your soba (which in Japanese means both "buckwheat" and "buckwheat noodles"). The way the buckwheat is harvested, threshed, dried and milled all play a part in determining whether the flour can be used for soba. You can't use Bob's Red Mill buckwheat flour, for example (we tried and ended up with a wet, sandy mixture instead of smooth dough). But stone-milled buckwheat flour from Cold Mountain worked well and is available at select Japanese markets.
He continues to knead, using the heel of his hand and his palm to fold the dough onto itself, rolling it forward. "Little by little the dough is getting smoother."
He pushes the dough down into the thinnest possible disk, using his palm and putting all of his weight on it.
With a rolling pin, he rolls the dough into an oval and then a rectangle while dusting uchiko flour onto his board (uchiko is difficult to find, so Inouye recommends substituting cornstarch). He folds the dough, rolled to about one-sixteenth-inch thick, into quarters and cuts the noodles with a sharp Japanese vegetable knife (we tried it with a sharp chef's knife, which works well too; a heavy cleaver had too thick a blade). Using a slight rocking, or "pitching," motion, he quickly cuts exquisitely thin, even slices (skill comes with practice).
The soba is boiled for just a minute to 90 seconds. Save the cooking liquid, or sobayu, to add hot to the tsuyu dipping sauce to drink as a soup at the end of the meal. After the soba is boiled, it is shocked in an ice bath to stop the cooking and then dipped into another ice bath to remove all of the surface starch and complete the cooling (soba cooking is a series of hot and cold baths).
Soba connoisseurs eat their noodles unadorned, presented on a zaru, or flat wooden strainer, with a dashi- and soy-based dipping sauce on the side and condiments such as sliced green onions, grated daikon, wasabi and togarashi. A creamier dipping sauce is made with ground walnuts and tsuyu.
It's worth going to the trouble of making soba to get fresh, elastic, toothsome noodles that sing with the flavor of buckwheat. Most dried, packaged soba is made with as much as 70% wheat flour. Buckwheat flour should be the first ingredient listed (and when it is, it can be expensive). It may take a little practice, but all soba masters have to start somewhere.
"The first time I tried to make soba, they were not noodles," Inouye says. "But the second time, great results. I thought, maybe I'm a great soba maker."
betty.hallock@latimes.com
Copyright © 2010, The Los Angeles Times
JAPAN: Bringing in the new year with soba is a Japanese tradition
By Sonoko Sakai
When I go back to Japan, some people assume that I head straight for sushi bars. But my favorite pastime is making pilgrimages to artisanal soba shops. If there is one food I love with a passion, it is soba, the thin, earthy-looking buckwheat noodles. I enjoy their natural sweet flavor and nutty aroma and eat them for lunch three or four times a week, and sometimes for dinner too.
I'm not the only one who places soba on such a high pedestal. "Soba is the best Japanese food there is," my friend Noritoshi Kanai said to me the other day. An active 86 years, he has a breakfast ritual that consists of a bowl of soba seven days a week, surpassing even my soba consumption.
Kanai likes soba because it makes him feel soboku -- a quality Japanese people treasure that means to be simple, natural, modest and elegant in an unadorned way. Considering this is the Japanese American businessman who brought the first sushi bar to the U.S., it's amazing what soba can do to keep one's ego in check.
Then comes the year's end, when the number of soba enthusiasts multiplies. Japanese people practice an old custom on New Year's Eve called toshikoshi soba, eating "Passing of the Year" soba to bring good luck and good fortune. The shape and length of soba are associated with a lean and long life.
Keep it simple
But soba is by no means an haute, complicated or new-wave noodle. Pure and simple, it's never masked with heavy, oily sauces. Instead it's usually eaten cold and plain with a dipping sauce or hot in a soy-based broth.
You can, however, pair soba with a variety of side dishes.
One classic accompaniment is tamago. You have probably eaten tamago at a sushi bar. It is an egg omelet that is made by rolling together several layers of cooked egg. It's seasoned with soy sauce, sugar and dashi, a fragrant broth made with dried bonito flakes and konbu (seaweed).
By adding dashi to the eggs, you get a juicy and savory omelet that is lighter in texture and flavor than its butter-based Western counterpart.
Some tamago can be sweet like a dessert custard. I hold off on the sugar and make a milder version. The tamago you see at sushi bars is usually rectangular or square because it is made in a special pan. I use a standard round pan to make mine. Not everything has to be square.
Kanai likes his morning soba with satsuma-age, or deep-fried fish balls, and a handful of fresh bean sprouts. It's a good combination of protein and vitamins to balance out the meal.
Satsuma-age is kind of like a sausage ball, except that it is made with minced fish and vegetables.
Satsuma-age originated in Kagoshima on the southern tip of the island of Kyushu where there is an abundance of fish. The people there call these deep-fried fish balls "tempura." But unlike the standard tempura, satsuma-age are not coated in a batter, so they're lighter.
Eat satsuma-age just out of the oil while they are hot and crispy. If you have any fear of deep-frying, like I once did, this is a good entry-level tempura to practice with.
They are also tasty at room temperature. You can grill them on the barbecue or put them in hearty nabe (stews). Satsuma-age is a good standby dish to have on hand because it freezes well.
Soba should be served immediately. The noodles will lose their al dente texture if you let them sit around too long.
When serving tamago or satsuma-age with soba, make the side dishes first and have plenty of grated daikon to serve as a condiment. Then boil the soba noodles, which takes one to five minutes, depending on the thickness of the soba and on whether you are using fresh or dried noodles.
Put all three of these dishes together and you have a nice spread for your New Year's Eve table. So before you finish up the year, how about joining me and millions of others in a big slurp of soba? Then pop open the Champagne and revel in the new year.
food@latimes.com
Copyright © 2010, The Los Angeles Times
CHINA: Large Oil Spill Reported in China
By DAVID BARBOZA
SHANGHAI — A large oil spill in northwest China has heavily polluted a tributary of the Yellow River, and threatens to reach one of the country’s longest and most important sources of water.
China’s state-run news media said late Saturday that a “large amount” of diesel oil had leaked out of a pipeline last Thursday in Shaanxi Province.
The government has not explained why the report of the spill was not released until late Saturday. But Xinhua, the official state news agency, said the leak was caused by construction work and that a crew of 700 people was struggling to contain the damage from what Shaanxi officials said was about 150,000 liters, or about 40,000 gallons, of diesel oil.
The damaged pipeline belongs to the China National Petroleum Corporation, one of the country’s state-owned oil giants and the parent company of PetroChina. The company did not specify on Saturday exactly how much oil was spilled but said that it had shut down the pipeline. The company also said that “much of the leaked oil and polluted silt has already been taken away.” But government officials in Shaanxi province said on Saturday that oil has been detected far downstream from the leak and warned local residents not to use water in the region.
The oil pipeline, which transports oil from northwest China to central parts of the country, was damaged and released oil into the Chisui River and Wei River, a tributary of the Yellow River, according to Xinhua.
The Yellow River, which stretches for about 5,500 kilometers, or about 3,400 miles, is a source of water for approximately 140 million residents, and it also provides water to factories and farms through northern China.
In November 2005, a huge amount of toxic benzyme leaked out and damaged the Songhua River in north China’s Heilongjiang Province, cutting off water supplies for millions of residents.
Some local officials were disciplined for a delay in reporting the spill, which later created a panic among residents.
Copyright 2010
JAPAN: Toshiba curbs loss on chip sales
Page last updated at 09:18 GMT, Friday, 29 January 2010
Toshiba supplies computer chips to Apple
Toshiba has said it made a smaller-than-expected loss in the final three months of last year due to a recovery in its electronic components business.
The company made a net loss of 10.6bn yen ($117.5m; £72.7m) compared with a loss of 121.1bn yen a year earlier.
Toshiba's chip business suffered heavy losses last year but was recovering, the company said.
Group revenue for the quarter rose 6% to 1.58 trillion yen, from 1.49tn yen a year earlier.
Toshiba, which supplies chips to Apple, has lowered its yearly revenue target from 6.8tn yen to 6.4tn yen, but kept its forecast for a 50bn yen loss for the year ending March 2010.
The company described sales of its televisions as "healthy", but blamed a decline in sales of home appliances on the economic downturn.
Saturday, January 2, 2010
JAPAN: Happy 1,300th to Nara, Japan
Heads Up
By HIROKO TABUCHI
THE ancient city of Nara has lived in the shadow of its neighbor, Kyoto,
for centuries. So this year, as Nara marks the 1,300th anniversary of its ascension as Japan’s imperial capital, the city might be forgiven for going over the top.
Nara was a splendor in its time — a world of silks, Chinese scripts and Buddhist culture set in a sleepy landscape. Built by the emperor Shomu, a convert to Buddhism, Nara played an important role in the spread of that religion in Japan, as evidenced by the ancient temples that still dot the city. Now it is celebrating that history in style.
After a $100 million investment, the eighth-century palace that once anchored Heijyokyo (Nara’s ancient name), only to be razed following the transfer of the capital to Kyoto in A.D. 784, has been painstakingly rebuilt and is scheduled to open on April 24. To celebrate the cultural diversity of the Nara Period, when the city reigned as the capital, Nara has built a life-size replica of a ship that carried Japanese envoys to and from Tang China.
But the restored palace and ship are just stage-setters for a yearlong festival (300.jp/foreign/english) to celebrate the city and its history. In the works are carnivals, fairs and musical performances drawing on an era that saw the rise of Buddhism in Japan, as well as the increased influence of the Tang Dynasty.
A highlight, officials say, is the “Corridor of Light” festival from Aug. 20 to 27, when the palace will be illuminated with candles and LED lights.
At the recreated palace, a 15-minute walk or short shuttle bus ride from Kintetsu Yamato-Saidaiji Station, guards in period armor will re-enact something akin to an ancient Japanese version of Buckingham Palace’s changing of the guard three times a day, between April 24 and Nov. 7.
At the heart of the city is Nara Park, and nearby is the Todaiji Temple, and home to Japan’s largest Buddha statue, erected in 752.
The city’s modern-day charms, however, lie in Naramachi, a historic merchant area in the heart of the city, which is now home to small museums, traditional town houses and a scattering of quaint cafes and restaurants. Ryo Yonehara, a Nara native who recently started an English language magazine, Nara Explorer, recommends taking at least an afternoon to explore Naramachi’s mazelike paths. “Strolling through Naramachi is when you’ll really fall in love with Nara,” he said.
In Naramachi, the restaurant Awa (1 Shonami-cho; 81-742-24-5699), set in a town house with pretty courtyard, offers a kaiseki, an elaborate seasonal meal with many courses, distinguished by Italian flourishes: think chilled eggplant with a sorghum and tomato sauce.
Mr. Yonehara’s favorite hangout is the more casual Mangyoku (9 Ganrin-cho; 81-742-22-2265), which occupies a former geisha house and offers tapas-style dishes like octopus marinated in Japanese vinegar and chili.
Locals will also tell you to stop by the Harushika “Spring Deer” sake brewery (27-4 Imamikado-cho; 81-742-23-2255) for a taste of the area’s famous rice wine. For just 400 yen, $4.50 at 89 yen to the dollar, a brewer will pour a sampling of five sakes. Don’t miss a Harushika blend prepared especially for the anniversary celebrations, which Shin Kamemura, a brewer, said is heavenly when taken chilled.
Copyright 2010 The New York Times Company
JAPAN: Paris, Milan, Tokyo. Tokyo?
By HIROKO TABUCHI
TOKYO — Japan’s trailblazers of street fashion are the envy of Western designers, spawning Web sites filled with snapshots of Tokyo youngsters in the latest distressed jeans or psychedelic stockings.
With city sidewalks as their catwalks, young Japanese flaunt carefully layered tops and thigh-high boots sporting labels like Galaxxxy, Phenomenon and Function Junction.
But most of Tokyo’s clothing designers have not figured out how to cash in on the city’s fashion sense. Only a handful of Japanese brands, like A Bathing Ape or Evisu Jeans, have gained traction beyond the nation’s shores. Chic local labels like Fur Fur and Garcia Marquez Gauche remain mostly unknown outside Japan.
Experts say that the nation’s fashion industry is too fragmented and too focused on the domestic market to make it overseas.
“For much of this decade, fashion trends have started in Japan and gone global. But Japanese brands don’t even realize that,” said Loic Bizel, a French-born fashion consultant based in Tokyo. Japan “generates trends and ideas, but it stops there,” he said. “Many brands are not even interested in going overseas.”
So each season, Mr. Bizel takes fashion industry buyers from America and Europe — mass clothiers like Hennes & Mauritz of Sweden and Topshop of Britain — to buy up bagfuls of the latest hits. The designs are then whisked overseas to be reworked, resized, stitched together and sold under Western labels.
In that business model, there is little financial gain for Japan. In 2008, Japan’s clothing and apparel-related exports came to a mere $416 million, dwarfed by the $3.68 billion exported by American apparel companies, and a tiny fraction of China’s $113 billion.
Meanwhile, Japan’s domestic apparel industry is on the decline. It shrank 1.3 percent, to 4.37 trillion yen ($48 billion), in 2008, and is expected to post a steeper decline for 2009 as recession-weary consumers and an aging population cut back sharply on spending.
“Japanese fashion might be considered cutting-edge, but overseas markets have been largely elusive,” said Atsushi Izu, an analyst at the Nomura Research Institute in Tokyo. “Japan’s fashion industry is very fragmented, and most companies lack the resources and know-how to bring their brands to foreign markets.”
The government is trying to help. Earlier this year, the Foreign Ministry dispatched a group of suit-clad officials to Tokyo’s hip Harajuku neighborhood to survey the latest trends, part of an effort to promote Japanese fashion overseas. After interviews with shoppers and sales clerks, the ministry came up with a battle plan: to appoint three young trendsetters as “ambassadors” of Japanese chic, charged with extending the industry’s reach overseas and piquing interest in Japanese brands.
One ambassador, Misako Aoki — a model known in Tokyo for her Lolita look of frilly Rococo-inspired dresses paired with platform shoes — has been dispatched to France, Spain, Russia and Brazil, where she has attended expos and hosted fashion talk shows in her trademark floppy bow tie and frilly smock.
“I hope that Lolita fashion and Japanese fashion in general will raise your interest in Japan,” Ms. Aoki said in São Paulo, Brazil, in November after starring in a Lolita fashion show organized by the Japanese embassy. (Although Lolita style is a reference to the Vladimir Nabokov novel “Lolita,” its look is more covered-up Victorian schoolgirl than skin-baring teenage vixen.)
The trade ministry has also helped revamp the twice-yearly Tokyo Collection and started inviting foreign journalists to come on the government’s dime. For the first time this year, the collection, renamed Japan Fashion Week, sponsored a splinter fashion event in New York to showcase Japanese designers, and it has planned another runway show in New York in mid-February.
“Japanese fashion has so much global potential,” says Kenjiro Monji, director general of the Foreign Ministry’s Public Diplomacy Department, who oversees Japan’s cultural push overseas.
But the government’s efforts have won it few fans in the fashion industry. Besides Ms. Aoki, the two other fashion ambassadors chosen by the government are a woman who likes to dress up in cute high school uniforms and another who mixes and matches secondhand clothes. Promoting such niche tastes does little to help the wider fashion industry, many say.
And Japan Fashion Week remains a relative nonevent filled with relatively obscure designers like Motonari Ono and Kazuhiro Takakura. Ambitious young designers hoping to follow in the footsteps of Japanese greats like Issey Miyake, Yohji Yamamoto and Rei Kawakubo may have to do what they did: pass over Tokyo’s shows for those in Paris.
Meanwhile, local favorites like Fur Fur — a new brand that mixes airy cotton frocks with distressed trench coats — have neither the expertise nor the resources to market overseas. Despite rave reviews from industry insiders, it has only one small store in Tokyo.
“Of course, taking my brand overseas is a dream,” said Fur Fur’s designer, Aya Furuhashi. “But to be honest, that’s really beyond us right now.”
What Japan’s fashion industry needs is more concrete help in marketing and setting up shop overseas, experts say. The government could also play a larger role helping Japanese labels protect their intellectual property rights, they say.
There are some promising signs. With government support, the start-up Xavel, which runs fashion shows that let women order outfits in real time using their cellphones, has opened shows in Paris and Beijing.
Fast Retailing, which sells the Uniqlo brand, has also been flexing its muscles overseas. Uniqlo, Japan’s answer to Gap, has roots in suburban outlets and does not have the level of respect among young fashion fans that many of Japan’s hipper brands do. But with ample funds and aggressive pricing on its fleece jackets and shirts, Uniqlo has expanded, with 92 stores worldwide.
Tadashi Yanai, chief executive of Fast Retailing, has said he hopes to build it into the world’s biggest apparel company, with sales of 5 trillion yen in 2020.
“We are part of a global economy,” Mr. Yanai said at a recent forum. “We cannot look inward.”
Moshe Komata contributed to this report.
Copyright 2010 The New York Times Company
JAPAN: For Some in Japan, Home Is a Tiny Plastic Bunk
By HIROKO TABUCHI
TOKYO — For Atsushi Nakanishi, jobless since Christmas, home is a cubicle barely bigger than a coffin — one of dozens of berths stacked two units high in one of central Tokyo’s decrepit “capsule” hotels.
“It’s just a place to crawl into and sleep,” he said, rolling his neck and stroking his black suit — one of just two he owns after discarding the rest of his wardrobe for lack of space. “You get used to it.”
When Capsule Hotel Shinjuku 510 opened nearly two decades ago, Japan was just beginning to pull back from its bubble economy, and the hotel’s tiny plastic cubicles offered a night’s refuge to salarymen who had missed the last train home.
Now, Hotel Shinjuku 510’s capsules, no larger than 6 1/2 feet long by 5 feet wide, and not tall enough to stand up in, have become an affordable option for some people with nowhere else to go as Japan endures its worst recession since World War II.
Once-booming exporters laid off workers en masse in 2009 as the global economic crisis pushed down demand. Many of the newly unemployed, forced from their company-sponsored housing or unable to make rent, have become homeless.
The country’s woes have led the government to open emergency shelters over the New Year holiday in a nationwide drive to help the homeless. The Democratic Party, which swept to power in September, wants to avoid the fate of the previous pro-business government, which was caught off-guard when unemployed workers pitched tents near public offices last year to call attention to their plight.
“In this bitter-cold New Year’s season, the government intends to do all it can to help those who face hardship,” Prime Minister Yukio Hatoyama said in a video posted Dec. 26 on YouTube. “You are not alone.”
On Friday, he visited a Tokyo shelter housing 700 homeless people, telling reporters that “help can’t wait.”
Mr. Nakanishi considers himself relatively lucky. After working odd jobs on an Isuzu assembly line, at pachinko parlors and as a security guard, Mr. Nakanishi, 40, moved into the capsule hotel in Tokyo’s Shinjuku district in April to save on rent while he worked night shifts at a delivery company.
Mr. Nakanishi, who studied economics at a regional university, dreams of becoming a lawyer and pores over legal manuals during the day. But with no job since Christmas, he does not know how much longer he can afford a capsule bed.
The rent is surprisingly high for such a small space: 59,000 yen a month, or about $640, for an upper bunk. But with no upfront deposit or extra utility charges, and basic amenities like fresh linens and free use of a communal bath and sauna, the cost is far less than renting an apartment in Tokyo, Mr. Nakanishi says.
Still, it is a bleak world where deep sleep is rare. The capsules do not have doors, only screens that pull down. Every bump of the shoulder on the plastic walls, every muffled cough, echoes loudly through the rows.
Each capsule is furnished only with a light, a small TV with earphones, coat hooks, a thin blanket and a hard pillow of rice husks.
Most possessions, from shirts to shaving cream, must be kept in lockers. There is a common room with old couches, a dining area and rows of sinks. Cigarette smoke is everywhere, as are security cameras. But the hotel staff does its best to put guests at ease: “Welcome home,” employees say at the entrance.
“Our main clients used to be salarymen who were out drinking and missed the last train,” said Tetsuya Akasako, head manager at the hotel.
But about two years ago, the hotel started to notice that guests were staying weeks, then months, he said. This year, it introduced a reduced rent for dwellers of a month or longer; now, about 100 of the hotel’s 300 capsules are rented out by the month.
After requests from its long-term dwellers, the hotel received special government permission to let them register their capsules as their official abode; that made it easier to land job interviews.
At 2 a.m. on one recent December night, two young women watched the American television show “24” on a TV inside the sauna. One said she had traveled to Tokyo from her native Gunma, north of the city, to look for work. She intended to be a hostess at one of the capital’s cabaret clubs, where women engage in conversation with men for a fee.
The woman, 20, said she was hoping to land a job with a club that would put her up in an apartment. She declined to give her name because she did not want her family to know her whereabouts.
“It’s tough to live like this, but it won’t be for too long,” she said. “At least there are more jobs here than in Gunma.”
The government says about 15,800 people live on the streets in Japan, but aid groups put the figure much higher, with at least 10,000 in Tokyo alone. Those numbers do not count the city’s “hidden” homeless, like those who live in capsule hotels. There is also a floating population that sleeps overnight in the country’s many 24-hour Internet cafes and saunas.
The jobless rate, at 5.2 percent, is at a record high, and the number of households on welfare has risen sharply. The country’s 15.7 percent poverty rate is one of the highest among industrialized nations.
These statistics have helped shatter an image, held since the country’s rise as an industrial power in the 1970s, that Japan is a classless society.
“When the country enjoyed rapid economic growth, standards of living improved across the board and class differences were obscured,” said Prof. Hiroshi Ishida of the University of Tokyo. “With a stagnating economy, class is more visible again.”
The government has poured money into bolstering Japan’s social welfare system, promising cash payments to households with children and abolishing tuition fees at public high schools.
Still, Naoto Iwaya, 46, is on the verge of joining the hopeless. A former tuna fisherman, he has been living at another capsule hotel in Tokyo since August. He most recently worked on a landfill at the city’s Haneda Airport, but that job ended last month.
“I have looked and looked, but there are no jobs. Now my savings are almost gone,” Mr. Iwaya said, after checking into an emergency shelter in Tokyo. He will be allowed to stay until Monday.
After that, he said, “I don’t know where I can go.”
Copyright 2010 The New York Times Company
THE KOREAS: Serving a Father by Bringing Long-Lost Koreans Home
Woohae Cho for The New York Times
“I have been a headache for the South Korean government, but I am finally carrying out my filial duty to my father.” — Choi Sung-yong
January 2, 2010
The Saturday Profile
SEOUL, South Korea
CHOI SUNG-YONG remembers his father as a war hero who became a successful fishing boat captain, a reserved man who helped at orphanages and once splurged to buy his music-loving teenage son a record player, a true luxury at the time.
But all the memories are tinged with loss. In 1967, when Mr. Choi was just 15, his father’s boat failed to return from sea. The family went into mourning, assuming the boat had sunk. But three months later they were shocked to learn that Mr. Choi’s father, Choi Won-mo, was alive, but lost to them. His vessel, it turned out, had been captured by North Korea, and when the North Koreans released the crew, they kept Mr. Choi’s father.
In the more than four decades since, Mr. Choi, 57, has devoted himself to trying to find his father and the hundreds of other missing South Koreans believed to have been snatched by North Korean agents.
He toils in a tiny office here, where the walls are covered with sepia-toned photos of the missing.
“So far,” he said, “my work has been a lonely fight.”
Unlike in Japan — where the plight of fewer than 20 Japanese abductees has become something of a national obsession — the issue of the disappeared is a divisive one here, freighted with a tangle of conflicting emotions about the North and the collective suffering of South Koreans since the peninsula’s fratricidal war from 1950 to 1953.
In the early years, South Korea’s fervently anti-Communist military rulers treated families like Mr. Choi’s with suspicion, fearful that those who had disappeared were defectors lured by the same ideology that helped cleave the country. But even a shift away from authoritarianism did not help. A succession of liberal presidents who gained power in democratic elections starting in the 1990s ignored the families’ cause in pursuit of reconciliation with the North.
While South Korea’s current, conservative, president, Lee Myung-bak, has taken a tougher line on the abduction issue, the South Korean public remains far less passionate on the subject than the Japanese, who helped drive their leaders not only to sever economic ties with the North, but also to continually urge the United States not to forget the abductees in its drive to get the North to give up its nuclear weapons program.
Fed up with waiting, Mr. Choi decided years ago to take matters into his own hands. In the late 1990s, he began traveling to northern China, where he developed contacts among North Koreans to try to gather information about his father.
Over time, he built something of an underground railroad in the North by using Koreans, sometimes by paying, to help the abductees escape across the border. And slowly, he began to achieve, in a small way, what the Seoul government has so far failed to do.
SINCE 2000, Mr. Choi says, Abductees’ Family Union, which he leads, has smuggled seven South Koreans back to their country via China, including one who later returned to the North because he had started a family there. Officials at South Korea’s Ministry of Unification, which helps oversee inter-Korean relations, acknowledge that Mr. Choi has succeeded in bringing out abducted South Koreans, though they will not confirm the number.
His efforts — and his role with Abductees’ Family Union, which lobbies for the families of 505 civilians thought by the South Korean government to have been kidnapped — have earned him wide attention in the South’s media. They have also, he says, led to death threats from the North.
As a result, he is now afraid to travel to China. But he says he will press on until he finds out what happened to his father, who would be 99 years old now if still alive, or at least retrieve his remains. His father’s former crew said his father had been kept in the North because of his war record, and Mr. Choi fears he may have been executed.
“I have been a headache for the South Korean government,” Mr. Choi said. “But I am finally carrying out my filial duty to my father.”
Like his father, most of the missing are fishermen who vanished when they ventured out to sea in the 1960s and 1970s. Based on South Korean intelligence and the tales of defectors, it appears that the North had several goals in mind when it captured South Koreans. Some were put to work as laborers. Others — like at least some of the Japanese — helped train spies who had little chance to learn about other nations, given their reclusive leaders’ absolute control on news and penchant for propaganda.
The abductees, experts on the issue in the South say, were also tools for the North’s propaganda machine; North Korea still insists that South Koreans who left their country defected for a happier life.
One of those who Mr. Choi’s group smuggled out of North Korea is Choi Wook-il, who is no relation to him. A shrimp fisherman, Choi Wook-il said his boat was seized by a North Korean gunboat in 1975. He was kept in the North until three years ago, when he was led at night across a frozen river into China and freedom, he said.
Now 69, he lives with his wife in a government-provided apartment in the city of Ansan, south of Seoul.
He said that without the efforts of Choi Sung-yong, he would never have been able to return to his life. “He is the only one making efforts.”
The fisherman’s wife, Yang Jeong-ja, 67, said she thought he was dead until Choi Sung-yong one day showed her a letter her husband had written to his brother, which was smuggled out via China. He also presented a picture of her husband taken in North Korea and said he could get her husband out. Ms. Yang was skeptical, but agreed to his plan.
Her husband said that one night almost a decade ago, he got a knock on the door from a North Korean who said he had been sent by Ms. Yang to lead him to China. At first, Mr. Choi — who had been working on a pear and corn farm because his middle-school education was deemed inadequate for spy training — said he did not believe his visitor. It took nine visits until he finally agreed to leave. After they arrived in South Korea, his guide defected. The other Mr. Choi said such successes help make up for the continued pushback from many South Koreans.
He has been criticized by government officials and many people in the public for threatening the South’s engagement with the North, which most South Koreans support in some form. That stance is somewhat pragmatic; those who want to unite with the North say peace will not only allow any abductees who are alive to return home, but also reunite the thousands of families split up during the war.
Experts say it is also difficult for the families of those who were kidnapped to gain sympathy because many of their countrymen feel some bitterness about their singling out their own suffering when so many families have been separated.
“This issue has been intertwined with all the national pain,” said Lee Keum-soon, a researcher on the abductions at the Korea Institute for National Unification, a government-financed research center.
FAMILIES of abductees say they are more hopeful now. President Lee, who took office two years ago, in November called addressing the abduction issue a precondition for holding any future summit meeting with the North.
Mr. Choi has also been appointed to a group that advises the government as it continues to investigate missing persons cases to determine if more of them are possible abductees. On his wall, he proudly displays a plaque that he received in 2009 from the president proclaiming his father a patriot for having piloted a boat that clandestinely dropped off guerrilla fighters behind enemy lines during the Korean War.
“Whenever I ask a North Korean for news of my father, my heart still beats wildly,” Mr. Choi said. “I have struggled to accept that I am a child whose father will never return.”
Su-Hyun Lee contributed reporting.
This article has been revised to reflect the following correction:
Correction: January 5, 2010
A picture with the Saturday Profile about Choi Sung-yong, the leader of Abductees’ Family Union who works to bring home South Koreans believed to have been kidnapped by North Korea, was published in error. The picture showed Choi Wook-il, a man who was smuggled out of the North by the Abductees’ Family Union; it was not of Choi Sung-yong.
Friday, January 1, 2010
JAPAN: Paris, Milan, Tokyo. Tokyo?
In the trendy Harajuku neighborhood of Tokyo, the latest street fashions, like thigh-high boots, are on display in shop windows. Ko Sasaki for The New York Times
January 2, 2010
TOKYO — Japan’s trailblazers of street fashion are the envy of Western designers, spawning Web sites filled with snapshots of Tokyo youngsters in the latest distressed jeans or psychedelic stockings.
With city sidewalks as their catwalks, young Japanese flaunt carefully layered tops and thigh-high boots sporting labels like Galaxxxy, Phenomenon and Function Junction.
But most of Tokyo’s clothing designers have not figured out how to cash in on the city’s fashion sense. Only a handful of Japanese brands, like A Bathing Ape or Evisu Jeans, have gained traction beyond the nation’s shores. Chic local labels like Fur Fur and Garcia Marquez Gauche remain mostly unknown outside Japan.
Experts say that the nation’s fashion industry is too fragmented and too focused on the domestic market to make it overseas.
“For much of this decade, fashion trends have started in Japan and gone global. But Japanese brands don’t even realize that,” said Loic Bizel, a French-born fashion consultant based in Tokyo. Japan “generates trends and ideas, but it stops there,” he said. “Many brands are not even interested in going overseas.”
So each season, Mr. Bizel takes fashion industry buyers from America and Europe — mass clothiers like Hennes & Mauritz of Sweden and Topshop of Britain — to buy up bagfuls of the latest hits. The designs are then whisked overseas to be reworked, resized, stitched together and sold under Western labels.
In that business model, there is little financial gain for Japan. In 2008, Japan’s clothing and apparel-related exports came to a mere $416 million, dwarfed by the $3.68 billion exported by American apparel companies, and a tiny fraction of China’s $113 billion.
Despite rave reviews from industry insiders, Fur Fur — a new brand that mixes airy cotton frocks with distressed trench coats — has only one small store in Tokyo.
Meanwhile, Japan’s domestic apparel industry is on the decline. It shrank 1.3 percent, to 4.37 trillion yen ($48 billion), in 2008, and is expected to post a steeper decline for 2009 as recession-weary consumers and an aging population cut back sharply on spending.
“Japanese fashion might be considered cutting-edge, but overseas markets have been largely elusive,” said Atsushi Izu, an analyst at the Nomura Research Institute in Tokyo. “Japan’s fashion industry is very fragmented, and most companies lack the resources and know-how to bring their brands to foreign markets.”
The government is trying to help. Earlier this year, the Foreign Ministry dispatched a group of suit-clad officials to Tokyo’s hip Harajuku neighborhood to survey the latest trends, part of an effort to promote Japanese fashion overseas. After interviews with shoppers and sales clerks, the ministry came up with a battle plan: to appoint three young trendsetters as “ambassadors” of Japanese chic, charged with extending the industry’s reach overseas and piquing interest in Japanese brands.
One ambassador, Misako Aoki — a model known in Tokyo for her Lolita look of frilly Rococo-inspired dresses paired with platform shoes — has been dispatched to France, Spain, Russia and Brazil, where she has attended expos and hosted fashion talk shows in her trademark floppy bow tie and frilly smock.
“I hope that Lolita fashion and Japanese fashion in general will raise your interest in Japan,” Ms. Aoki said in São Paulo, Brazil, in November after starring in a Lolita fashion show organized by the Japanese embassy. (Although Lolita style is a reference to the Vladimir Nabokov novel “Lolita,” its look is more covered-up Victorian schoolgirl than skin-baring teenage vixen.)
The trade ministry has also helped revamp the twice-yearly Tokyo Collection and started inviting foreign journalists to come on the government’s dime. For the first time this year, the collection, renamed Japan Fashion Week, sponsored a splinter fashion event in New York to showcase Japanese designers, and it has planned another runway show in New York in mid-February.
“Japanese fashion has so much global potential,” says Kenjiro Monji, director general of the Foreign Ministry’s Public Diplomacy Department, who oversees Japan’s cultural push overseas.
But the government’s efforts have won it few fans in the fashion industry. Besides Ms. Aoki, the two other fashion ambassadors chosen by the government are a woman who likes to dress up in cute high school uniforms and another who mixes and matches secondhand clothes. Promoting such niche tastes does little to help the wider fashion industry, many say.
And Japan Fashion Week remains a relative nonevent filled with relatively obscure designers like Motonari Ono and Kazuhiro Takakura. Ambitious young designers hoping to follow in the footsteps of Japanese greats like Issey Miyake, Yohji Yamamoto and Rei Kawakubo may have to do what they did: pass over Tokyo’s shows for those in Paris.
Meanwhile, local favorites like Fur Fur — a new brand that mixes airy cotton frocks with distressed trench coats — have neither the expertise nor the resources to market overseas. Despite rave reviews from industry insiders, it has only one small store in Tokyo.
“Of course, taking my brand overseas is a dream,” said Fur Fur’s designer, Aya Furuhashi. “But to be honest, that’s really beyond us right now.”
What Japan’s fashion industry needs is more concrete help in marketing and setting up shop overseas, experts say. The government could also play a larger role helping Japanese labels protect their intellectual property rights, they say.
There are some promising signs. With government support, the start-up Xavel, which runs fashion shows that let women order outfits in real time using their cellphones, has opened shows in Paris and Beijing.
Fast Retailing, which sells the Uniqlo brand, has also been flexing its muscles overseas. Uniqlo, Japan’s answer to Gap, has roots in suburban outlets and does not have the level of respect among young fashion fans that many of Japan’s hipper brands do. But with ample funds and aggressive pricing on its fleece jackets and shirts, Uniqlo has expanded, with 92 stores worldwide.
Tadashi Yanai, chief executive of Fast Retailing, has said he hopes to build it into the world’s biggest apparel company, with sales of 5 trillion yen in 2020.
“We are part of a global economy,” Mr. Yanai said at a recent forum. “We cannot look inward.”
Moshe Komata contributed to this report.
CHINA: Top Ten Most Watched People (风云人物) of 2009
Two interesting observations about the most-watched people. First, 20 percent of the list goes to Americans, and to black Americans at that: President Obama, not surprisingly; and Tiger Woods (who it might be noted is part Chinese, though it’s doubtful this had anything to do with his popularity). Secondly, 70 percent is negative-news related. I would reckon this is a necessary complement to the relentlessly positive “news” in the mainstream press.
1. President Obama
Obama’s election night victory speech (which of course was given in November 2008, and not actually in 2009) resonated across the Pacific in China, with many viewers reporting that they were actually moved to tears by some of his oratory and the power of the moment. We’re so often told about an assertive China and a Chinese Internet seething with angry nationalistic youth scornful of the U.S. and its president, but the popularity of Obama and the reception of his speech at least among Youku viewers suggests a more complex picture indeed.
2. Brother Zeng
For me, the most baffling and disturbing part is to hear the supportive whistling and applause. Am I still in my world where singing or performing is still interpreted through time-tested, evolution-selected bio- or physiological standards? If so, how can one possibly understand this Brother Zeng phenomenon? If we want to describe Brother Zeng as another Furong Jiejie, the latter at least seems to have her own logic, however twisted: She’s some kind of narcissistic personality disorder victim, and her “fandom” is clearly tongue-in-cheek. But what’s up with people who liked Brother Zeng?
3. Gome Founder Huang Guangyu
Huang Guanyu, the founder of China’s largest appliance chain Gome Electrical Appliances, used to be the second-richest man in mainland China. But it’s a dangerous business to be rich in the PRC. Under investigation for white-collar crime, Huang resigned his position as Gome chairman, as reported in this video news. The news also disclosed that Huang gambled away 8 billion RMB in 2009. The news report suggest this caused a broken link in Gome’s cash flow, which we would assume partly contributed to Huang’s collapse.
4. “Scholar” Ren Zhiqiang
Ren is famous for being the unofficial spokeman for Chinese realtors and developers. When the television drama Snail House stirred up Chinese emotions over skyrocketing housing prices, Ren jumped out to claim in this news clip that it’s only natural that Chinese youth cannot afford apartments of their own. He also believed that housing prices in China were still too cheap. An amazing quote from him: “Even in developed countries such as the U.S., owning a house and a car yourself is considered a dream, but here in China, many youngsters around 30 realized this dream. Don’t you think we are more advanced?”
5. Tiger Woods
Tiger Woods, as everyone on Earth probably already knows, cheated on his wife and announced that he was leaving pro golf “with no specific return date.” one exact same phrase used by Edison Chen (Chen Guanxi), a Hong Kong entertainer who was caught in a massive and very, erm, graphic sex scandal in early 2008.
The related news ranked third on Youku’s Top 10 Hot Topics. 20-year-old Hu Bin struck and killed a pedestrian while street racing in Hanghzou, instantly becoming the poster child for the “rich second generation.” Chinese netizens followed the news closely, and soon discovered the boy in court looked totally different. Rumor of the rich Hu family paid certain taxi driver to replace Hu Bin for three year imprisonment quickly spread online. This video report did a small investigation and proved it was the real Hu Bin who is now serving his term.
7. Xiao Shenyang
Comedian Xiao Shenyang became a household name after his performance on CCTV’s annual Spring Festival show (春晚) early in 2009. The sketch that made him famous was called “Money’s No Issue,” (不差钱,buchaqian), but ironically a scandal about suggested that for Xiao Shenyang, money really is an issue. After performing in Shanghai, he was booked to perform in the nearby city of Changzhou, and the show promoter there sent a tourbus to pick him and his entourage up in Shanghai. His manager refused to allow him to perform unless the Changzhou promoter paid all costs of airfare to and from Beijing. After the promoter relented and paid, the comic and his crew caused another scene in a restaurant, insisting that the poor promoter pick up the tab for a lavish banquet.
8. Xie Caiping
This ordinary-looking middle-aged woman was in fact the capo di tuti capi, the boss of all bosses, in the massive Chongqing organized crime syndicate that’s been the object of a major investigation this year. She allegedly controlled gambling and the drug trade, and had a large string of officials in her pocket. What a contrast to the stereotype we have of the heilaoda (黑老大). Xie was given a prison term of 18 years, and a fine of 1.02 million RMB.
9. Magician Liu Qian
After performing at CCTV’s annual Spring Festival gala (春晚), Taiwanese magician Liu Qian gained fame overnight in mainland area, and sparked nationwide fever for magic. Liu Qian has long been referred to as the most renowned Taiwanese magician and performed internationally. His contemporary program design and always sleek appearance attracted millions, and now apparently billions viewers. This video clip from one entertainment program at Hunan Satellite TV shows how Liu Qian works his magic.
10. Writer Yu Qiuyu or Investor Yu Qiuyu
Writer Yu Qiuyu is famous for his signature meditations on Chinese culture and history — and for his ability to earn money on his literary fame. In a country that traditionally believes the intelligentsia should choose a life of material poverty, Yu Qiuyu drew a lot criticism when news that he had invested in a former state-owned department store came out. As one of the major shareholders, Yu Qiuyu’s stake, on paper at least, was worth billions of yuan. Though many viewers support a writer to make money, many question how the ownership of a state-owned department store can easily and mysteriously be transferred to certain seemingly irrelevant individuals.
Source: buzz.youku.com
Wednesday, December 30, 2009
RUSSIA & CHINA: China: Russia’s Land of Opportunity
Photo by Joshua Kucera
DECEMBER 30, 2009
BY JOSHUA KUCERA
Where Russia Meets China: The final part of a 5-part series in cooperation with Slate.
SUIFENHE, China -- In 1989, the opening of the border between Russia and China raised Russian fears of a "yellow peril": millions of Chinese citizens flooding north into relatively unpopulated, but richly endowed, Siberia. Some contrarian publications even went so far as to suggest that Russia should just accept the inevitable and sell the whole territory to China.
Demographically, it makes sense that Chinese people would flock to Russia. Look at it in economic terms, though: China's economy is booming, and its prospects seem limitless. Meanwhile, Russia is highly dependent on uncertain oil and natural gas reserves. Professionals already make more money in China than they do in Russia, and as China's economy grows, blue-collar wages will likely outpace Russian pay. So, rather than Chinese people moving to Russia, isn't it more likely that Russians would move to China?Part 1: Meet the Siberian Liberation Army
Part 2: Don't Call Them Twin Cities
Part 3: “China is the destiny of Siberia.”
Part 4: Vladivostok's Used-Car Dealers Are Mad As Hell
I asked this question of many Russians in the Far East, and I usually got the same answer: It's already happening. Thus far, the Russian migration to China seems to be only a trickle. But it's not hard to imagine that this is just the start.
The energy in Suifenhe, a relative backwater, is so much greater than in Vladivostok-a city three times the size-that taking the four-hour bus trip across the border is like switching from black-and-white to color.
The road from Vladivostok becomes progressively worse the closer you get to the border, and the land is almost empty of people. As soon as you cross the border into China, there is a massive shopping mall with red cupolas, an apparent nod to Russian architecture, and an international-standard Holiday Inn.
The mall is part of what was supposed to be a joint Chinese-Russian free-trade zone, where people would be able to come to shop and tour visa-free. But all Russia has built on its side of the border is a church, which Chinese tourists photograph through the chain-link fence.
The day I arrived was one of the biggest celebrations in recent Chinese history: the 60th anniversary of the establishment of the People's Republic of China. Still, at the many construction projects around the city's center, workers were on the job until after dark. I thought back to Vladivostok, where a huge suspension bridge is under construction. It is supposed to be ready by 2012, when the city plays host to the Asia-Pacific Economic Cooperation summit.
Ostensibly, this is a priority project overseen from Moscow, but when I mentioned to my translator that I hadn't seen anyone working on it, she smiled. "Yes," she said. "We notice that all the time."
Suifenhe's economy is driven by Russian shoppers on package tours, and the shops in the city center all have signs in the Cyrillic alphabet. One sporting goods store was called CSKA, after Moscow's legendary soccer team. I flipped through the T-shirts on sale at another boutique and saw shirts advertising the 2014 Sochi Olympics and United Russia, Vladimir Putin's political party.
But in addition to the many Russian tourists, there is a growing population of Russian expatriates living in Suifenhe. One, a journalist named Stanislav Bystritski, is a former reporter for a Vladivostok TV station. He moved here five years ago and produces two Russian-language shows on local Suifenhe TV, one oriented toward Russian tourists and one for Chinese people who want to learn about Russia and the Russian language.
As he showed me around town, an elderly Chinese man greeted us with a smile and said "Horosho," which means good in Russian. It seemed a strange thing to say, but Bystritski told me it was a common greeting by Chinese people here, because it sounds like it could be a Chinese word and is easy for Mandarin speakers to pronounce.
He echoed what I had heard in Blagoveshchensk and Vladivostok-Russians come to China because it is easier to get a good job and easier to do business.
"So many Russian businessmen say it's easier to work here, there is so much less corruption and bureaucracy," he said.
Suifenhe's government once had plans to build a Russian quarter, reportedly with the expectation that up to 50,000 Russians might relocate here, though those plans appear to have been abandoned. Bystritski said that the rules on apartment ownership by foreigners have been loosened, so the government may have decided that there is no longer a need for a special Russian district. (We couldn't find out for sure. Bystritski set up a meeting with a member of Suifenhe's local government to talk about that and other issues involving Russian migrants. The official apparently assumed I would be Russian, and when Bystritski introduced me as an American, the official's eyes widened somewhat cartoonishly. He probably wasn't the best person, he said, and in the end I couldn't get anyone from the local government to talk to me.)
Still, I was able to meet several Russians who had moved here. Petr is building a small complex of apartment buildings for Russians. The Suifenhe government is so enthusiastic about the project that it is bulldozing the homes of the Chinese people who currently live in the area.
Viktor, a Russian engineer who moved here at the beginning of 2008, is working on a pollution-control technology that has excited more interest in China than it did in Russia.
"The Chinese are more interested in innovative projects, so there are more opportunities here," he said.
His wife, Natasha, works as a technician with Suifenhe's pioneering (and, to a civil libertarian, rather ominous) "electronic security" system, in which surveillance cameras all over town are controlled from a spotless control room in a glass-fronted building called the Suifenhe Cyberport. She says she wants her 4-year-old son to be raised "in Chinese traditions," and she is making sure he learns Chinese.
"People are so friendly here, I feel so comfortable," she said. "This is my new home."
Joshua Kucera is a freelance journalist based in Washington, D.C. This series also appears on Slate.com.
Tuesday, December 29, 2009
RUSSIA & CHINA: “China is the destiny of Siberia.”
Photo by Joshua Kucera
DECEMBER 29, 2009
BY JOSHUA KUCERA
Where Russia Meets China: Part 3 of a 5-part series in cooperation with Slate.
BLAGOVESHCHENSK, Russia -- I originally came to the Russian Far East with the idea that the Russian-Chinese border was roughly analogous to the U.S.-Mexican border: poor, darker-skinned people sneaking north across a river for better job opportunities, freaking out the white people.
Poor Chinese do cross over, and they do work for less than Russians. And some of the overheated immigration rhetoric you hear in the United States exists in Russia, too, about the "zheltaya ugroza," or "yellow peril." That paranoia is much more prevalent in Moscow than in the Russian Far East, however. Here, everyone seems to have their favorite example of how other Russians exaggerate the Chinese presence. There are reports in the Moscow press that half the population of Blagoveshchensk is Chinese or that there are dozens of Chinese villages in Russia that don't appear on any map. "I've heard that the streets in Blagoveshchensk are named after Chinese generals or that there are Chinese people on the city council here," Mikhail Kukharenko, the head of the Chinese-government-run Confucius Institute, told me.Part 1: Meet the Siberian Liberation Army
Part 2: Don't Call Them Twin Cities
Part 4: Vladivostok’s Used-Car Dealers Are Mad as Hell
Part 5: China As Russia's Land of Opportunity
In part because the government has placed tight restriction on Chinese visitors to Russia, there is little visible Chinese presence in Blagoveshchensk-and there's more here than anywhere else in Russia. There are a couple of so-called "Chinese markets," where Chinese vendors sell cheap clothes and electronics, but you can find these all over Russia and the former Eastern bloc. There are also a good number of Chinese restaurants catering to Russian tastes: It was here that I had stir-fried potatoes for the first time.
But you see very few Chinese people on the streets, other than a few tourists snapping photos of the statue of Lenin or of the reconstructed arch originally built for Czarevich Nicholas' visit through the Far East in 1891.
What is remarkable here, though, is the enthusiasm that Russian people-in contrast to the Russian government-display about China. While some poor Chinese citizens come to Russia for work, educated, middle-class Russians are increasingly going in the other direction. Among the group of young, English-speaking Russians I fell in with in Blagoveshchensk, nearly all of them worked in some capacity with China. Many of them had lived there. One, Sergey, was home from his job in Shanghai, and he raved about how much friendlier, more open, and optimistic Chinese people were compared with Russians.
One feature of the Russian-Chinese relationship seemed especially telling: Cross-border marriages are overwhelmingly between Chinese men and Russian women. Much of this has to do with demographics-Russia has a surplus of women, while China has too many men.
But as one Russian woman told me, "Chinese men are kinder and more attentive to their wives. And they usually have more money."
In the international relations department of Amur State University in Blagoveshchensk, the number of students studying Chinese increases every year, and more Russian students now learn Chinese as their first foreign language than English. The department is closing its European studies track and shutting down German and French. Soon, it will offer only Chinese and English.
"China is the destiny of Siberia, our present and future depends in every respect on what happens in China," Victor Dyatlov, a professor at Irkutsk State University and a top authority on Russian-Chinese relations, told me. "The only direction we can move in is integration and cooperation between Russia and China. But we don't know what form that integration will take."
But this local integration with China doesn't mean much to the larger picture, Dyatlov said. "The future of Siberia and its people is defined not by the people here but in Moscow," he said. "What people in Siberia think isn't that important. Siberia is the national treasure, and the people here are just meant to help the government exploit these resources."
Indeed, many people complain that Moscow treats the Russian Far East like a cash cow to be exploited for export income to China and cares little about how people here live. In February 2009, Russia and China signed a 20-year, $25 billion oil deal, and by the end of that term China could be getting one-quarter of its imported oil from Russia and Central Asia. Most of that oil will come from eastern Siberia, through a pipeline whose original route veered dangerously close to famously pristine Lake Baikal, prompting protests from Siberians.
Russia also recently started selling electricity to China from the Bureya Dam, on a tributary of the Amur, at a price cheaper than Russians pay for electricity in Blagoveshchensk.
"We don't like it," said Svetlana Kosikhina, the dean of the international relations department at Amur State. "Electricity is expensive here, and if we sell it to China, it's going to be even more expensive."
Even locals admit to a significant amount of skepticism about China's intentions toward the Russian Far East. Kukhalenko-as director of the Confucius Institute here, he's an employee of the Chinese government-said he assumes that "a lot" of the Chinese students in Blagoveshchensk are spies, "especially the ones who are older and who speak good Russian already." There are also rumors of a secret museum in Heihe-shown only to Chinese tourists-that displays maps showing Chinese control over the Russian Far East.
"We're not afraid, but we're wary. We just don't understand what they're going to do. It's a system that could rise up at any moment and attack us," Kosikhina said. "We have a saying here: 'Pessimists study Chinese.'"
Joshua Kucera is a freelance journalist based in Washington, D.C. This series also appears on Slate.com.