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Monday, June 10, 2013

U.S., Chinese leaders talk 'new model'

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By Greg Botelho. Dan Merica and Jessica Yellin, CNNJune 9, 2013 -- Updated 0607 GMT (1407 HKT)/*var clickExpire="-1";var playerOverRide={headline:"Obama, Xi pledge \'new relationship\' ",images:[{image:{height:"360",width:"640",text:"http://i2.cdn.turner.com/cnn/dam/assets/130608175054-obama-xi-china-us-wide-story-top.jpg"}}]};*/window.jQuery(document).ready(function() {window.CNNVIDEOS = window.CNNVIDEOS || {};CNNVIDEOS[ 'T1' ] = CNNVIDEO( 'cnnCVP1', {video: 'world/2013/06/09/pkg-yellin-us-china-summit-concludes.cnn',thumb: 'http://i2.cdn.turner.com/cnn/dam/assets/130608175054-obama-xi-china-us-wide-story-top.jpg',preset: 'storypage',diagnostics: {section: 'articlepage',placement: 'page-top'},network: 'cnn',adsection: cnnCVPAdSectionT1 || '',headline: 'Obama, Xi pledge \'new relationship\' ',videoSource: 'CNN',videoSourceUrl: '',url: ''});// pause other videos playing on pagewindow.jQuery( '#cnnCVP1' ).on( 'onContentBegin', function( e, obj ) {for ( var instance in window.CNNVIDEOS ) {if ( instance !== 'T1' && window.CNNVIDEOS.hasOwnProperty( instance ) ) {try { window.CNNVIDEOS[ instance ].pause(); } catch(e){}}}});});/*var cnnWindowParams=window.location.toString().toQueryParams();if(typeof cnnWindowParams.video!="undefined"){if(cnnWindowParams.video){cnnLoadStoryPlayer('world/2013/06/09/pkg-yellin-us-china-summit-concludes.cnn','cnnCVP1', '640x384_start_art' ,playerOverRide,T1);}} else {$('cnnCVP2').onclick=function(){if ($$('.box-opened').length){$$('.box-opened').each(function(val){Element.fireEvent(val,'click');});}cnnLoadStoryPlayer('world/2013/06/09/pkg-yellin-us-china-summit-concludes.cnn','cnnCVP1','640x384_start_art',playerOverRide,T1);};$('cnnCVP2').onmouseover=function(){$('cnnCVP2').className='cnn_mtt1plybttn cnn_mtt1plybttnon';};$('cnnCVP2').onmouseout=function(){$('cnnCVP2').className='cnn_mtt1plybttn';};}*/NEW: Xi says meeting could "chart the future of China-U.S. relations" NEW: Obama says a peaceful, prosperous China is good for the U.S., world The two leaders meet for 2 days in the desert around Palm Springs, CaliforniaThe talks come as the U.S. has said cyberattacks have originated from China

Palm Springs, California (CNN) -- Even after months of tensions over alleged cyberattacks, the leaders of China and the United States struck positive tones in a two-day summit that ended Saturday in the sweltering heat of the California desert as both talked of forging a "new model" for their relations going forward.

"We're meeting here today to chart the future of China-U.S. relations," Chinese President Xi Jinping said. "...We need to think creatively and act energetically so that working together we can build a new model of major country relationship."

The summit at the Annenberg Retreat at Sunnylands, just outside Palm Springs, comes less than three months after Xi rose to his current post. Both he and U.S. President Barack Obama pointed out their meeting is happening sooner than some expected, a testament they said to both men's recognition of the importance of solid relations between the two countries.

And both heads of state, who met last year in Washington when Xi was China's vice president, spoke of pursuing policies that furthers their nation's respective interests.

"It is in the United States' interest that China continues on the path of success, because we believe that a peaceful and stable and prosperous china is not only good for Chinese but also good for the world and for the United States," he said.

The U.S. president did allude to the fact "areas of tensions" are inevitable, highlighted his nation's commitment to human rights, and its support for "an international economic order where nations are playing by the same rules."

"And ... the United States and China (can) work together to address issues like cybersecurity and the protection of intellectual property," he added.

That comment -- tucked in the middle of Obama's opening remarks -- was the closest the U.S. president got to referring to the rhetorical skirmishes of late over whether U.S. servers and secrets have been targeted from China.

Such allegations were made in a Pentagon report that points to "the Chinese government and military" as the likely culprits of cyberintrusions in American institutions, to allegations that even the presidential campaigns of Mitt Romney and Barack Obama were hacked by Chinese operatives in 2012.

Beyond the broad outlines laid out by the two leaders late Friday afternoon, it's not clear exactly what the leaders will discuss over the coming days.

But experts on U.S.-China relations told CNN that they don't expect cyberattacks will come up in direct negotiations, which occur as the Obama administration is on the defensive over whether it's wrongly violated citizens' privacy in collecting phone and online data as part of its antiterrorism strategy.

"They both won't want to and won't be able to use this as leverage in a discussion," said Chris Johnson, China expert at the Center for Strategic and International Studies. "They won't be able to say this is the pot calling the kettle black."

Robert Pastor, founder and director of the Center for North American Studies at American University, said the two nations have different perspectives.

While the "U.S. is focusing on acts of violence and terrorism," Pastor said, China is "utilizing the Internet and other mechanism in order to steal commercial or military secrets."

Earlier this month, Defense Secretary Chuck Hagel pointed to China when he addressed cybersecurity threats, telling an audience of defense professionals in Singapore that the United States was concerned about "the growing threat of cyber intrusions, some of which appear to be tied to the Chinese government and military."

In an annual support on Chinese military capabilities, the Pentagon echoed Hagel's claim, stating that recent cyber attacks in the United States appeared "to be attributable directly to Chinese government and military."

Despite the fact that most experts believe the United States use of monitoring is unlikely to come up, many acknowledged that if Obama and other White House negotiators push too hard on charging the Chinese with cyberespionage, domestic programs in the United States could be used against them.

"The potential for pushing back is there and that may force the United States to take a more win-win approach," echoed Kennedy, stating that if it does come up, it may force the United States to focus on less decisive goals from the two-day summit.

The fact is cybersecurity is just one of the many issues the two countries might address. One is what to do about North Korea's nuclear program. Another is how to address climate change. Then there's how to fairly boost the economies of both countries.

Meanwhile, the American public sees China as much as an ally or, at least, a "frenemy."

The latest Gallup poll shows 55% of Americans asked think China is either an ally (11%) or a nation friendly to the United States (44%), while 40% say it is either unfriendly (26%) or an enemy (14%).

For the most part, the different experts said, this weekend's meeting will primarily be an opportunity for the two leaders to get to know one another, while also addressing major issues.

"If these guys come out of the meeting saying, I understand this other person and this is someone I can work with" then the meeting should be considered a success, Johnson said.

CNN's Greg Botelho reported and wrote from Atlanta, Jessica Yellin reported from Palm Springs, and Dan Merica reported from Washington. CNN's Jethro Mullen contributed to this report.

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China: World's e-wastebasket?

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U.N. report: "China now appears to be the largest e-waste dumping site in the world"Products originally produced in China are now finding their way back as electronic junkThe small town of Guiyu as been a major hub for the disposal of e-waste"When recycling is done in primitive ways ... it is hugely devastating for the local environment"

Guiyu, China (CNN) -- Did you ever wonder what happens to your old laptop or cellphone when you throw it away?

Chances are some of your old electronic junk will end up in China.

According to a recent United Nations report, "China now appears to be the largest e-waste dumping site in the world."

E-waste, or electronic waste, consists of everything from scrapped TVs, refrigerators and air conditioners to that old desktop computer that may be collecting dust in your closet.

Many of these gadgets were initially manufactured in China. Through a strange twist of global economics, much of this electronic junk returns to China to die.

"According to United Nations data, about 70% of electronic waste globally generated ended up in China," said Ma Tianjie, a spokesman for the Beijing office of Greenpeace.

Much of [the e-waste] comes through illegal channels ... from developed countries like the United States to countries like China and Vietnam
Ma Tianjie, Greenpeace"Much of [the e-waste] comes through illegal channels because under United Nations conventions, there is a specific ban on electronic waste being transferred from developed countries like the United States to countries like China and Vietnam."

For the past decade, the southeastern town of Guiyu, nestled in China's main manufacturing zone, has been a major hub for the disposal of e-waste. Hundreds of thousands of people here have become experts at dismantling the world's electronic junk.

On seemingly every street, laborers sit on the pavement outside workshops ripping out the guts of household appliances with hammers and drills. The roads in Guiyu are lined with bundles of plastic, wires, cables and other garbage. Different components are separated based on their value and potential for re-sale. On one street sits a pile of green and gold circuit boards. On another, the metal cases of desktop computers.

At times, it looks like workers are reaping some giant plastic harvest, especially when women stand on roadsides raking ankle-deep "fields" of plastic chips.

In one workshop, men sliced open sacks of these plastic chips, which they then poured into large vats of fluid. They then used shovels and their bare hands to stir this synthetic stew.

"We sell this plastic to Foxconn," one of the workers said, referring to a Taiwanese company that manufactures products for many global electronics companies, including Apple, Dell and Hewlett-Packard.

Dirty, dangerous work

This may be one of the world's largest informal recycling operations for electronic waste. In one family-run garage, workers seemed to specialize in sorting plastic from old televisions and cars into different baskets. "If this plastic cup has a hole in it, you throw it away," said a man who ran the operation, pointing to a pink plastic mug. "We take it and re-sell it."

But recycling in Guiyu is dirty, dangerous work. "When recycling is done properly, it's a good thing for the environment," said Ma, the Greenpeace spokesman in Beijing.

"But when recycling is done in primitive ways like we have seen in China with the electronic waste, it is hugely devastating for the local environment."

Much of the toxic pollution comes from burning circuit boards, plastic and copper wires, or washing them with hydrochloric acid to recover valuable metals like copper and steel. In doing so, workshops contaminate workers and the environment with toxic heavy metals like lead, beryllium and cadmium, while also releasing hydrocarbon ashes into the air, water and soil, the report said.

For first-time visitors to Guiyu, the air leaves a burning sensation in the eyes and nostrils.

Toxic tech

Studies by the Shantou University Medical College revealed that many children tested in Guiyu had higher than average levels of lead in their blood, which can stunt the development of the brain and central nervous system.

Piles of technological scrap had been dumped in a muddy field just outside of town. There, water buffalo grazed and soaked themselves in ponds surrounded by piles of electronic components with labels like Hewlett-Packard, IBM, Epson and Dell.

The enormous animals casually stomped through mounds of sheet glass, which clearly had been removed from video monitors.

Flat screen displays often use mercury, a highly toxic metal.

"Releases of mercury can occur during the dismantling of equipment such as flat screen displays," wrote Greenpeace, in a report titled "Toxic Tech." "Incineration or landfilling can also result in releases of mercury to the environment...that can bioaccumulate and biomagnify to high levels in food chains, particularly in fish."

Most of the workers in Guiyu involved in the e-waste business are migrants from destitute regions of China and poorly educated. Many of them downplayed the potential damage the industry could cause to their health.

They asked only to use their family names, to protect their identity.

It may not sound nice, but we don't dare eat the rice that we farm because it's planted here with all the pollution
Zhou, a local farmer"Of course it isn't healthy," said Lu, a woman who was rapidly sorting plastic shards from devices like computer keyboards, remote controls and even computer mice. She and her colleagues burned plastic using lighters and blow-torches to identify different kinds of material.

"But there are families that have lived here for generations ... and there is little impact on their health," she said.

Several migrants said that while the work is tough, it allows them more freedom than working on factory lines where young children are not permitted to enter the premises and working hours are stringent.

Used to be worse

Despite the environmental degradation and toxic fumes permeating the air, many in Guiyu said that conditions have improved dramatically over the years.

"I remember in 2007, when I first came here, there was a flood of trash," said Wong, a 20-year-old man who ferried bundles of electronic waste around on a motorcycle with a trailer attached to it.

"Before people were washing metals, burning things and it severely damaged people's lungs," Wong added. "But now, compared to before, the [authorities] have cracked down pretty hard."

But residents who did not work in the e-waste business offered a very different take on the pollution in Guiyu.

A group of farmers who had migrated from neighboring Guangxi province to cultivate rice in Guiyu told CNN they did not dare drink the local well water.

They claimed if they tried to wash clothes and linens with the water, it turned fabrics yellow.

The head of the group, who identified himself as Zhou, had another shocking admission.

"It may not sound nice, but we don't dare eat the rice that we farm because it's planted here with all the pollution," Zhou said, pointing at water-logged rice paddy next to him.

Not that surprising considering that the latest food scandal to hit the country earlier this month is cadmium-laced rice. Officials in Guangzhou city, roughly 400 kilometers away from Guiyu, found high rates of cadmium in rice and rice products. According to the city's Food and Drug Administration samples pulled from a local restaurant, food seller and two university canteens showed high levels of cadmium in rice and rice noodles. Officials did not specify how the contaminated rice entered the city's food supply.

CNN made several attempts to contact the Guiyu town government. Government officials refused to comment on the electronic waste issue and hung up the phone.

However, it did appear that government efforts to restrict imports of foreign waste are reducing the flow of e-trash here.

"Why are they stopping the garbage from reaching us?" asked one man who ran a plastic sorting workshop. "Of course it's hurting our business," he added.

Domestic e-waste grows

The Chinese government had some success regulating e-waste disposal with a "Home Appliance Old for New Rebate Program," which was tested from 2009 to 2011.

With the help of generous government subsidies, the program collected tens of millions of obsolete home appliances, according to the U.N.

Even if Chinese authorities succeed in limiting smuggled supplies of foreign garbage, the U.N. warns that the country is rapidly generating its own supply of e-waste.

"Domestic generation of e-waste has risen rapidly as a result of technological and economic development," the U.N. reported. It cited statistics showing an exponential surge in sales of TV's, refrigerators, washing machines, air conditioners and computers in China over a 16-year period.

To avoid a vicious cycle of pollution, resulting from both the manufacture and disposal of appliances, Greenpeace has lobbied for manufacturers to use fewer toxic chemicals in their products.

The organization also has a message for consumers who seem to swap their phones, tablets and other computer devices with increasing frequency.

"Think about where your mobile phone or where your gadgets go," said Ma, the Greenpeace activist.

"When you think about changing [your phone], or buying a new product, always think about the footprint that you put on this planet."

Connie Young contributed to this story

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Mexico's China charm game

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Time to take a 'Breather'

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Julien Smith says rooms like that pictured above will be available for around $20 an hour with his Breather appAuthor Julien Smith has launched Breather, a concept for distributing space Breather allows real estate owners to let their spaces for around $20 an hourStarbucks is the closest to a city pit-stop, but around it are likely empty office spacesBreather has partnered with Lockitron to create an app which allows access to the space

(CNN) -- Julien Smith, writer, speaker and now start-up chief executive, says he's good at "predicting and following trends." And now he's getting into another: Distributed space.

Smith, co-author of books including Trust Agents, which explores how to use the web as a tool of influence and reached The New York Times bestseller list, revealed Breather at Le Web in London.

Le Web's theme is the "sharing economy," with Airbnb given top billing. Breather works with the same idea -- utilizing space that would otherwise be empty -- but for a city pit-stop at a cost per hour.

Le Web: The Google glasses view of sharing economy?

Smith says he is "obsessed" with private space where one can take time out, without obligations, at any time.

"I notice sound, and space, a lot," he says. And in the rush of big cities such as New York or London, finding a time-out zone can be difficult.

Starbucks is the closest existing outlet for an on-the-run office, but around each coffee store are likely empty commercial spaces, Smith says. He plans to unlock them.

The idea is "obvious," Smith says. "In 2050 we're not going to be walking around thinking 'where can we go'," he says.

Read more: The end of consumer culture as we know it

Smith is connecting the owners of real estate in New York, London, and San Francisco to open "millions of square feet" of real estate that can be used for around $20 an hour. Space can be reserved from an hour to the entire day.

It will be done through an app for which Smith has partnered with Lockitron, which featured at Le Web in Paris last December. The Lockitron locks will be installed at the Breather spaces, allowing users access at a time that suits them.

Those who use the app will be screened and assessed after use, meaning anyone who breaches standards will be banned from using Breather again.

Read more: My year of living open source

Breather has the credit card details and phone details of those using the app which Smith says will ensure security for the "private club...we can ban anyone at will," he said.

The app will be available to a limited number of people in 60 days, with a fuller roll out in October.

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Firms take Chinese medicine west

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Chi-Med and Nestle working to get FDA approval for some Chinese medicinePhase III trials have started on HMPL-004 -- used to treat stomach problemsIt's final round of trials before FDA approval to enter the $7B IBD market

Hong Kong (CNN) -- At Chi-Med's labs in Shanghai, a group of 70 chemists has been working for a decade to try and crack the mysteries of Chinese medicine.

The company's scientists are attempting to break 1,300 medicinal herbs into their component parts and then test them for global use against diseases.

It's an ambitious effort and one that looks close to paying off. Chi-Med, in partnership with Nestle, has started the first worldwide phase III clinical testing trials -- the final step before approval for sale -- for a botanical drug based on Chinese Traditional Medicine.

If Chi-Med and Nestle succeed in winning U.S. Food and Drug Administration (FDA) approval, the companies will be at the forefront of efforts to export Chinese medicine beyond its loyal following at home. They'll also have tackled the central problem in taking Chinese medicine global: how do you get a centuries-old remedy through the rigors of modern government regulation?

The testing was made possible by a change in the FDA policies and procedures in 2004 regarding botanical drug products.

The new guidelines removed some of the obstacles involved in getting an investigational new drug application (IND), the first step in getting a drug developed and marketed in the U.S.

Since the guidelines were introduced, the FDA has only approved two botanical drugs, according to the U.S. Department of Health & Human Services. Fulzaq, an antidiarrheal drug used for HIV/AIDS patients and derived from the red sap of the Croton lechleri plant, was approved in December 2012. Veregen, a treatment for warts based on green tea extract, was given the green light in 2006.

By Chinese medicine standards, HMPL-004 is a simple drug. It's a single extract from a single herb, called andrographis, which has a long history of use in Asia for stomach problems.

Contrast that with She Xiang Bao Xin Wan, one of Chi-Med's primary products in China.

It's a prescription cardiovascular drug with over 100 different chemical components, which Hogg explains makes it nearly impossible to get through the current U.S. approval system. "If you are working with the FDA to register that, you are going to have to explain to them exactly where each of those compounds comes from and you are going to have to guarantee every step that exactly the same amount of the compound is in that product," he says.

There are currently 2,800 patients in the phase III clinical trials to determine if HMPL-004 is both safe and effective.

The more similar it is to conventional drugs, the better from the FDA standpoint.
Christian Hogg, Chi-MedIf FDA agrees with the results, the drug will then enter the $7 billion global market to treat IBD.

Chi-Med is not alone in its efforts to take Chinese botanical drugs beyond China.

Dr. Yibin Feng at Hong Kong University's School of Chinese Medicine is studying the effectiveness of Chinese medicine treatments for cancer and liver disease. He says the lack of advanced science and technology has meant in the past that traditional Chinese medical doctors did not understand how the treatments worked. "We know this works for some disease, but I don't know what the scientific basis is," he says. "Why does it work for this disease?"

Dr. Feng believes all of that is changing now. Both he and Hogg think the slowing pace of conventional drug development is driving more people to look to Chinese medicine.

"Now new drug discovery from natural products and other material is more difficult that many years ago, people notice the wisdom in Chinese medicine," says Dr. Feng. He's particularly hopeful people outside China will begin to see the value in China's more complicated, multi-ingredient treatments. In fact, he sees these multi-faceted remedies as one of the major assets of Chinese medicine.

Dr. Hogg believes gradually the foreign regulators will become more open to the range of Chinese drugs. "It is in the best interest for the public health to be bringing these therapies to the market," he says.

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