Further, the International Energy Agency (IEA) has warned that the mainland's energy import policies were becoming increasingly vulnerable to events beyond its control. The IEA is concerned that if political strife arose -- particularly in the Middle East where it has the majority of its energy relationships -- Beijing could find it difficult to continue securing a supply of energy resources.

Stepping in after Taiwan's relatively peaceful transition of power to do something deemed "unnecessary" by Henry Kissinger, speaking Wednesday on the Charlie Rose show, U.S. envoy Richard Holbrooke said on Wednesday he was encouraged by the mainland's wait-and-see attitude toward Taiwan. Indeed, Beijing vowed not to negotiate with anyone who advocates the island's independence, something the president-elect, Chen Shui-bian did for a long time. A cause for concern. During the talks, Holbrooke urged the two rival governments to negotiate and also confirmed U.S. support for Beijing's position that Taiwan and the mainland are part of "one China." Kissinger suggested it was not the place of the U.S. to interfere at this point in something in which it might cause disruption.

Kelon Group, the Guangdong-based air-conditioner and refrigerator manufacturing giant, will reshuffle management to beef up its operations and improve its bottom lines. Analysts said it was an important measure by Kelon Group to meet the challenges being created by the mainland's entry of the World Trade Organization (WTO). The move comes as a number of mainland home-appliance makers, including Haier Group, Wuxi Little Swan and TCL, have launched similar reorganizations in an attempt to streamline their operations amid a fierce battle in the domestic sector.

Leaders of the U.S. Senate Finance Committee introduced Thursday legislation that would grant the mainland permanent trading privileges in the U.S. market. The Finance Committee, which is responsible for trade legislation in the Senate, is expected to approve the bill next month, to ensure the U.S. benefits from its landmark November WTO agreement with the mainland. Most senators support the trade initiative, but it faces stiff opposition in the House of Representatives from labor unions and their Democratic allies. A former U.S. ambassador to China, James Lilley, told the committee the agreement would give Chinese reformers the strength to take on the military and "party dinosaurs." John Sweeney, president of the AFL-CIO labor federation, warned that it would clear the way for Beijing to repress its workers. The Clinton administration wants Congress to approve the legislation by June, fearing further delay would bog it down in election politics.

To reach Jonathan S. Landreth: jslandreth@virtualchina.com