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China set to implement its first civil code, as private investment slows – Financial Post

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China’s parliament is poised to enact its first civil code, a wide-ranging legislative package that includes strengthening protection of property rights in a Communist Party-ruled country whose embrace of private ownership has long been awkward.

The civil code, in the works since 2014, will become law at a time when China needs its often-embattled private sector to step up investment to help revive a virus-battered economy, and will be a centerpiece of the annual parliamentary session that begins on Friday after a more-than two month delay.

However, the civil code is largely an amalgamation of existing laws, meaning its impact may be limited, some analysts said. And enforcement is uncertain, as courts are not independent and ultimately answer to the party, although legal reforms in recent years have aimed to give judges more independence and rein in local officials’ influence over courts.

The civil code, which among other provisions protects personal information and makes it easier to divorce or sue for sexual harassment, is expected to spell out the clearest boundary yet between government and markets since the 1949 founding of the People’s Republic of China.

It is a cornerstone of President Xi Jinping’s push to reform the country’s legal system by 2020, even as China has tightened controls on civil society and expanded party control under his leadership.

The legislation – on paper at least – reduces the scope for bureaucratic meddling and abuse that have often bedeviled private firms and property owners in a country where business owners were not allowed to join the Communist Party until 2001 and are still treated with suspicion by some party officials.

“It gives more complete protection to the rights of the individual,” said Wang Jiangyu, a law professor at the City University of Hong Kong.

“The bigger context is, is this a country that adheres to the rule of law? Is the government really executing the law?”

BUSINESS INSECURITY

Implementation of the code, which incorporates existing laws including those covering property, contracts and torts, reflects long-running concerns among business owners over protection of personal and property rights.

“All private firms have their ‘original sin,’” Xu Bin, a steel trader in Henan province, told Reuters in March, referring to the sometimes dubious actions taken by entrepreneurs in the early days of China’s reform and opening.

Some worry those “sins” can still be used against them.

A 2017 survey on the climate for private sector firms by Unirule Institute of Economics, a now-defunct liberal Beijing-based think tank, found companies rated “legal fairness” 4 out of 10.

“Without legal protection, private businessmen don’t feel safe. Our survey showed that they think there is a 22.5% chance of danger to themselves and a 26.8% chance that their assets are at risk,” Sheng Hong, an independent scholar who was previously Unirule’s executive director, told Reuters.

However, the civil code will not protect entrepreneurs in criminal cases.

“Since the Civil Code only covers civil disputes, it does not help protect property rights against seizure of assets by the state, a most important concern among entrepreneurs,” said Xin Sun, a lecturer in Chinese and East Asian business at King’s College London.

NEEDED INVESTMENT

Private sector investment in China has slowed sharply, to the worry of officials, from more than 20% growth when Xi assumed power to single digits in recent years. It fell 13% during the coronavirus-battered first four month of this year, compared with a 7 percent decline for state companies.

In an April meeting chaired by Xi, the Communist Party’s decision-making Politburo said the government will support the private economy and development of small- and medium-sized firms, which remain excluded from several industries and have long had difficulty securing bank credit.

“The civil code could restore confidence of private business owners and to help prop up economic growth,” said Hu Xingdou, a retired economics professor with Beijing Institute of Technology.

Sun, of King’s College, isn’t so sure, saying the civil code brings little added protection for rights and property, and is more symbol than substance.

“China does have a comprehensive system of high-quality written laws but a lot of concerns arise from their enforcement rather than the laws themselves,” he said.

(Reporting by Keith Zhai, Gabriel Crossley, and Yew Lun Tian Editing by Tony Munroe and Michael Perry)

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Without investment, universities and colleges heading for a crisis – Toronto Star

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Universities and colleges employ hundreds of thousands of people, educate and train over two million students annually and drive research that improves the lives of all Canadians. In cities and communities across the country, they are regional economic drivers and social and cultural centres. Our world-class post-secondary education system is critical to our prosperity, underpins our democracy and finds solutions to key challenges, be it COVID or climate change.

All of this is in peril — and not just because of the COVID-19 pandemic.

Public funding for post-secondary education has been stagnant for more than a decade. COVID-19 has brought the system closer to the edge. Strategic investments in universities and colleges must be made now to ensure a strong economic recovery and a more resilient future for Canadians.

COVID-19 has strained resources and reduced revenues, especially from international student fees. For decades, in the absence of sustainable government funding, students and their families have been asked to pay more. Private sources of funding now make up over half of university revenues, up from just 20 per cent when the parents of students may have once been on campus.

Since the last recession in 2008, provincial government spending in the sector has decreased by one per cent in real terms. Meanwhile, student enrolment has grown by more than 20 per cent over the same time, and income from tuition by nearly 70 per cent. With more than half of all university students already taking on an average of $28,000 of debt to get an education, reliance on student fees to solve the funding crisis simply isn’t sustainable.

There are three areas that need immediate action from the federal government to put post-secondary education on stable footing and improve quality, affordability and accessibility.

First, we need a national strategy for post-secondary education with goals to tackle education inequality, enhance affordability and strengthen research capacity. The last time the federal government increased the base funding to the provinces and territories for post-secondary education was in 2008 under Stephen Harper and this came with no plan of action to address key challenges.

Secondly, we need to accelerate research through enhanced investments in fundamental research. The government’s own advisory panel recommended funding levels 40 per cent higher than what we are investing today to keep Canada competitive.

The pandemic has also put much research on hold. In a survey of Canadian Association of University Teachers (CAUT) members, two out of three have seen their research stop or stall as a result of the pandemic. This hiatus in research will have a significant downstream impact on the innovation and knowledge that supports Canada’s economy.

Finally, we need to secure opportunities for youth and the unemployed by decreasing upfront costs and moving to a free tuition model for working- and middle-class Canadians. The government’s temporary doubling of the Canada Student Grant this year will help students cover costs this term, however it is still less than the average tuition.

It is also an unsustainable approach.

While we have seen increases in student financial assistance, we have also seen increases in tuition. As some provincial officials half-joke, the best way to leverage federal funding for post-secondary education is to raise tuition, as this will increase demands for federally funded student financial assistance.

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Some of the necessary changes to the funding model for post-secondary education could be met by redirecting the $900 million in unused federal funding from the failed Canada Student Service Grant program. The government could also repurpose the Canada Training Benefit to ensure that Canadians have more meaningful and timely access to educational opportunities.

There are many public services and sectors that need strengthening to get us out of the current crisis and be better for it. Post-secondary education is an essential foundation for social cohesion, science, innovation and economic success in Canada, and must not be taken for granted. We cannot let it languish now, when it is so critical to the well-being of our country.

Brenda Austin-Smith is a film studies professor and head of the English, theatre, film and media department at the University of Manitoba. She is also president of the Canadian Association of University Teachers, which represents 72,000 academic staff at universities and colleges across the country.

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Glimmer of hope for investment in Europe: EY survey – The Journal Pioneer

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By Mark John

LONDON (Reuters) – Global executives see a smaller hit to their investment plans for Europe than they did earlier this year and are somewhat more upbeat about the continent’s future appeal, a questionnaire by professional services group EY found.

The survey, conducted in October before a series of COVID-19 vaccine trial breakthroughs, showed that 42% of executives now expect a decrease in their 2020 investment plans and 31% plan to delay them to 2021.

That compared with 66% who expected decreases and 23% who saw delays when asked the same question back in April. This time around, a small number – 10% – even saw an increase to their 2020 investments, something no one did in April.

While that still means a big overall hit to foreign direct investment after 2019’s record year, EY noted that 21% of those surveyed believed Europe would be more attractive for investment post-Covid compared to just 8% in April.

“It is promising that investors believe that over the next three years, Europe will become a much more attractive destination for investments than before pandemic,” EY Area Managing Partner Julie Teigland said.

The findings were based on interviews with 109 global executives across 14 industries in October.

Upbeat news from vaccine trials are starting to support economic sentiment. The monthly eurozone Purchase Managers Index (PMI) for November saw a rise in its “future output” component in November to its highest level since February.

Among the other takeaways from the EY survey, 63% expected faster roll-out of digital customer access to surveys in the next three years (versus 55% in April) but only 37% now saw a reversal of globalisation (versus 56%).

(Reporting by Mark John, editing by Ed Osmond)

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Glimmer of hope for investment in Europe: EY survey – TheChronicleHerald.ca

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By Mark John

LONDON (Reuters) – Global executives see a smaller hit to their investment plans for Europe than they did earlier this year and are somewhat more upbeat about the continent’s future appeal, a questionnaire by professional services group EY found.

The survey, conducted in October before a series of COVID-19 vaccine trial breakthroughs, showed that 42% of executives now expect a decrease in their 2020 investment plans and 31% plan to delay them to 2021.

That compared with 66% who expected decreases and 23% who saw delays when asked the same question back in April. This time around, a small number – 10% – even saw an increase to their 2020 investments, something no one did in April.

While that still means a big overall hit to foreign direct investment after 2019’s record year, EY noted that 21% of those surveyed believed Europe would be more attractive for investment post-Covid compared to just 8% in April.

“It is promising that investors believe that over the next three years, Europe will become a much more attractive destination for investments than before pandemic,” EY Area Managing Partner Julie Teigland said.

The findings were based on interviews with 109 global executives across 14 industries in October.

Upbeat news from vaccine trials are starting to support economic sentiment. The monthly eurozone Purchase Managers Index (PMI) for November saw a rise in its “future output” component in November to its highest level since February.

Among the other takeaways from the EY survey, 63% expected faster roll-out of digital customer access to surveys in the next three years (versus 55% in April) but only 37% now saw a reversal of globalisation (versus 56%).

(Reporting by Mark John, editing by Ed Osmond)

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