Medicines for Ailing MAS: losses RM2bil, 6,000 job cuts, RM6bil capital injection a bailout?

New medicine for ailing MAS

FOR the first time ever, a government-linked company (GLC) will lay off workers and renegotiate contracts with suppliers and employees – a move that will obliterate the view that companies owned by the Government provide steady employment and are safe paymasters.

In its strongest action to rehabilitate the ailing Malaysia Airlines (MAS), the Government has given its undertaking to its investment arm, Khazanah Nasional Bhd, with the necessary legislation to bring the employees and suppliers to the negotiation table.

This is among the highlights of a 12-point plan unveiled by Khazanah yesterday to resuscitate MAS.

To recap, Khazanah, in a bid to save MAS, has proposed to take it private and delist it by year-end. It has a 69% equity in MAS and has offered to buy the remaining 31% in the airline at 27 sen a share.

A new Bill called the MAS Act will be tabled in Parliament before July next year to facilitate the migration of MAS’ existing operations into a new company (Newco), which will take over MAS’ operations on July 1 next year.

“The MAS Act is to facilitate the migration of the existing operations to a Newco. It is something that was proposed by the Government so that a new airline can take over. It will have a finite life,” Khazanah managing director Tan Sri Azman Mokhtar told the media yesterday.

“The Government will allow the transfer of the AOC (air operator’s certificate) and tax losses to the Newco.”

Apart from the establishment of a Newco to carry on the business of the existing airline, the plan calls for the conversion of some debt into equity and Khazanah injecting RM6bil more into the airline. Kumpulan Wang Persaraan (KWAP) agreed to swap its RM750mil existing perpetual sukuk with ordinary equity, meaning that it will eventually become shareholder in MAS.

 

Azman: 'The MAS Act is to facilitate the migration of the existing operations to a Newco'.

Of the RM6bil, a sum of RM1.4bil is for the privatisation of MAS, RM1.6bil for cost incurred in shutting down the existing company and a voluntary separation scheme to reduce the workforce by 6,000 and penalties for early termination of contracts with suppliers, and RM3bil for working capital for the Newco to take over the operations.

Since taking over MAS in 2001 from Tan Sri Tajudin Ramli, Khazanah has injected more than RM7bil into MAS, which Azman does not think would be recoverable.

However, he is confident that the RM6bil capital that will be pumped in can be recovered.

“We have done the financial modelling and are confident that the money can be recovered,” he said.

“Also, it is a conditional injection of funds, meaning that the money will only be available subject to the MAS management fulfilling the conditions set out in the recovery plan.”



Azman admits that renegotiating contracts with suppliers, leasing agents and converting debt to equity could have some effect on the credit ratings of MAS and other companies within the stable of the strategic investment fund.

However, he opines that the shedding of the workforce and the renegotiations of contracts is only to bring about a significant change in work practices and supply contracts.

“It would not be done arbitrarily. There is some bench-marking on the pricing of the contracts. The suppliers will be given an option to migrate to the Newco on new terms,” he said.



Azman is also confident that the new MAS will achieve profitability by the end of 2017. The new plan will also see net gearing reduced from 290% now to about 100% -125% eventually.

But not many share Azman’s sentiments, as MAS has undertaken half a dozen restructuring exercises over the past 13 years and yet remains in dire straits.

“I obviously do not share the same sentiments as Azman and am not as optimistic about seeing a profit in 2017. I don’t think the new plan goes far enough to resolve the structural problems within the airline. You can call it downsizing or rightsizing, and the plan may appear bold and courageous by slashing 6,000 jobs, but the question is: how much can you actually save from that?” Shukor Yusof, an analyst with Malaysia-based aviation consultancy Endau Analytics, asks.

He says, “The real issue in MAS the past decade is an ill-conceived strategy and financial mismanagement. That’s the key contributors to the losses, shareholder value destruction and the mess built up over the years. While I do agree that MAS is overstaffed, resulting in low productivity levels compared to Singapore Airlines (SIA) or Cathay Pacific, it is not a critical aspect of the overall picture. The losses registered over the years by the airline are not because the airline is overstaffed, but because it had a management which, unfortunately, had little understanding of the airline industry and was slow to adapt to the dynamics of the landscape of the industry,” Shukor says.

Route rationalisation 

MAS has been loss-making for the past 10 quarters, and the amount has ballooned since the two tragedies hit the airline within a space of four months since March this year. The first was on March 8 when a plane, MH370 en route to Beijing, disappeared.

The second was on July 17 when MH17, which was on the way from Amsterdam to Kuala Lumpur, was shot down while flying over Ukraine.

Even before the first airline tragedy on March 8, the airline was already losing close to RM1bil a year due to competition from low-cost carriers and Middle-Eastern full-service carriers (FSCs).

However, the losses exacerbated to RM2bil following the airline tragedies.

For the second quarter of 2014, MAS announced on Thursday an RM307mil net loss, bringing its first-half losses to RM750mil.

 

A lack of demand and the massive cancellations of flights has become a norm after the two incidents, and the policy to refund passengers after the MH17 mishap has further seen flight bookings going down. The airline’s strategy of pushing for loads at the expense of yields has also backfired. However, it has embarked on a new plan to drop fares to win back customers, a strategy which, however, does not guarantee high yields, which MAS needs.

MAS’ current yield of 20 sen per seat kilometre is lower than Cathay Pacific’s 24 sen and SIA’s 22.9 sen.

Azman says there are several conditions for the money to be injected into MAS.

Among them is route rationalisation, whereby the emphasis is on destinations that are within eight hours of flying time. The plan is also to bring short-haul cost within the 15% of the low-cost carrier competition, at parity with Middle-Eastern FSCs and below those of the regional FSC competition. The Newco will only focus on profitable routes and secure global connectivity via oneworld and other alliances, says Khazanah, adding that MAS will come up with a business plan and fleet requirements.

Maybank Investment Bank senior analyst Mohshin Aziz says that with one-third of the jobs going, the route network also needs to be reduced by one-third.

“We were hoping to get the details of the route cuts, but they were not forthcoming. We really believe MAS should terminate its long-haul routes, such as Frankfurt, Amsterdam, Paris, Istanbul and even Dubai as soon as possible.

“They need to reduce frequencies on their Australian routes to twice daily from thrice daily now, and terminate the Brisbane and Adelaide routes,” Mohshin says.

Since the network will be reconfigured, MAS will also have to reduce the number of aircraft it flies from its current fleet of 127 to bring down cost.

Khazanah says MAS needs to renew its focus on revenue management to increase unit revenue by 10% to 15%, and among other things, it needs to also unbundle ancillary products and services and revamp its loyalty programme.

Staff buy-in

A major part of the success of Khazanah’s new plan for MAS hinges on the support of the airline’s employees and their unions. Yesterday, Azman met representatives of the unions to tell them of the new plan, but will the unions support the plan?

A major part of the success of Khazanah's new plan for MAS hinges on the support of the airline's employees and their unions.

“It was a good and frank discussion. I think we were at pains to try and explain what would be happening. And explain that the vessel of the Newco will not be able to carry everybody,” Azman says.

Throughout the day, Khazanah officials and MAS senior team members had various briefing sessions with its employees.

For now, the ties are somewhat strained between the senior team and many of the unions and their members, with many worried about the selection process of who would be axed.

Under the new plan, MAS will undertake a voluntary separation scheme to reduce its workforce to 14,000, with the plan also involving reskilling, redeployment and job creation.

“There seems to be a renewed effort to harmonise now so that Khazanah’s vision of rebuilding a national icon will succeed. But at a glance, the plan is wishy-washy and they are not able to give us details. We are worried as to who will decide on who stays and who leaves. We also do not want the existing team to decide, as there would be no professionalism, only partiality,’’ said a source.

Khazanah says the process of transfer migration and separation will be conducted with “utmost care, fairness and due process”.

A Khazanah official added that “the decision on who stays and who leaves will be done by the Newco”.

“The search for a new chief executive officer (CEO) for the Newco has begun and we are looking at both Malaysian leadership talent and global aviation specialists, basically for the CEO (post),” Azman says.

“Hopefully they will hire the best in the industry and not just anyone for the hot seat. It should be someone with entrepreneurial spirit and expertise to drive profits,’’ says an expert.

The current group CEO Ahmad Jauhari Yahya will leave MAS in June next year.

The plan to set up a Newco is also seen as a way to weaken MAS’ vociferous unions, although an expert says that the Newco could also set up new unions, provided there are no conditions attached to the Newco’s staff appointment letters.

Would minority shareholders sell out?

The biggest challenge Khazanah will face is whether it can get enough minority shareholders and institutional funds to vote in favour of its plan to privatise MAS at an EGM to be called in the coming weeks.

It needs 100% acceptance to take MAS private, and then there will be grounds for the Act to be established.

Khazanah cannot vote at the EGM, given the fact that it is an interested party and institutional shareholders only hold less than a 4% equity in MAS.

Now that there is a serious plan to resuscitate MAS, it is possible that some minorities may want to hold back and not sell their shares. Not only will MAS be profitable by 2017, but there is also a plan to relist the Newco in 2018-2020.

“There will be some minorities who will give up their shares, as holding MAS has been one painful episode. But there are yet others who may see that there is going to be creation of value in the future. So, why sell and miss out on future growth?” opined a source.

However, if Khazanah fails to get 100% equity in MAS, then the entire revival plan will be off.

By B.K. Sidhu The Star/Asia News Network

Radical plan to revive MAS

Khazanah Nasional Bhd has unveiled a radical plan to revive the ailing Malaysia Airlines that calls for job cuts, a capital injection of up to RM6bil and creation of a new company (Newco) to carry the airline business.

To facilitate the migration of the existing business to Newco, the Government will table a new law in Parliament called the MAS Act.

Khazanah managing director Tan Sri Azman Mokhtar said that the new legislation would have a finite life and was needed to facilitate the migration of the existing business to Newco.

In a move to ensure that Newco has a leaner workforce and cleaner balance sheet to compete effectively in a tough operating environment, Khazanah wants to see job cuts of 30% from the existing MAS workforce of 20,000 employees.

It is one of the many conditions Khazanah has imposed on the management of MAS if it were to inject more funds into the ailing airline.

 

“In our opinion, we think that Newco with its business model will require a workforce of about 14,000. A net reduction of 30% is an across-the-board number,” said Azman at a media briefing yesterday.

The job cuts also affect the top leadership of MAS, which comprises a team of 500 staff called the Extended Leadership Team (ELT). Most of them were holding senior positions with long service.

Azman said the current chief executive officer (CEO) of MAS, Ahmad Jauhari Yahya, has indicated his wish to leave.

In commending the MAS CEO for having led the airline during its toughest period, Azman said Ahmad Jauhari would remain in place until the transition.

“We have embarked on a global search for a new CEO and have engaged an international firm to undertake the task,” he said.

Some of the other conditions of the 12-point plan mapped by Khazanah for the recovery of MAS include the relocation of the airline’s existing headquarters in Subang to the KL International Airport and Khazanah owning 100% of MAS.

Towards this end, Khazanah is undertaking a privatisation of MAS at 27 sen per share.

Azman clarified that Khazanah had engaged a consultancy to undertake a review of MAS on Feb 26 this year, before the first airline tragedy on March 8.

“The review came about after the Government was concerned about the financial and general state of affairs in MAS,” he said.

On March 8, a MAS aircraft en route to Beijing went missing and further exacerbated the airline’s losses.

The Cabinet approved MAS’ proposal on Wednesday and yesterday the various stakeholders, which are mainly the unions, existing airline management and some key directors, were summoned for a briefing.

The management and union have been told to work together to decide the shedding of the workforce, he said.

The MAS Act is expected to arm Khazanah with the necessary bite to carry out the radical measures, especially in negotiating the new contracts and collective agreements of the unions.

“The Act would allow for the Air Operators Certificate (AOC) to be transferred from the existing MAS to Newco and the assets and liabilities,” said Azman.

By July 1 next year, Newco is expected to take off.

Azman said that employees who were not absorbed into Newco would be offered a retrenchment scheme or given an option to be absorbed into a scheme for re-training.

Towards this end, Khazanah is working with three business process outsourcing firms that have vacancies for 3,500.

Azman said Khazanah explored several options in coming up with the plan.

“Putting in more money into MAS would not save MAS. So we felt that enabling MAS to start on a clean slate and putting in new money into Newco provided it met the conditions stated was the best option,” he said. - The Star

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MCA Youth calls for concerted effort to help MAS
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What makes us Malaysian? Happy Mereka!

I always get excited when I meet fellow Malaysians, whether at work or during social functions. - Lee Yee Thian

Our sense of belonging is strong, despite living miles away from our homeland.

BACK home in Malaysia, “Chinese” is one of the options in the race column, while in China, it refers to a nationality.

It took me awhile to get used to not nodding when I was asked if I am a Chinese.

“I’m a Malaysian,” I would answer, and get a bewildered look from the inquirers.

“Oh, so you are a Malay? But you look exactly like us. And your command of Mandarin is so good,” was their usual reply.

I would then launch into a lengthy explanation of how I am ethnically Chinese but a Malaysian national, and “Malay” refers to the largest ethnic group in Malaysia and not the people of Malaysia.

I would add that I can read and write Mandarin because I attended Chinese vernacular school, but I could tell they were confused.

“Were you born in China? How old were you when you left for Malaysia?”

“No, I was born in Malaysia. I’m a third-generation Malaysian Chinese.”

And then came the inevitable question: “Where do you feel you belong?”

I grew up singing Negaraku every Monday during school assemblies.

I learned how to draw our national flag when I was in Year One. Next to the crescent, I traced the outline of a 50 sen coin and then carefully drew 14 spikes around the circle.

And until today, I can still hum the tune of Sejahtera Malaysia, a patriotic song that was aired years ago on RTM.

When we say we are Malaysians, we say it with a tinge of pride.

In addition to Malay, English and Mandarin, most Malaysian Chinese here can also understand one or more Chinese dialects.

It is a fact that draws the admiration of many locals.

I asked a few Malaysians in Beijing what makes them Malaysian.

Lee Yee Thian, who has been abroad in the United Kingdom and then China since 2000, said our multicultural background was instrumental in helping him to adapt to living in a foreign country.

The sense of belonging is strong, despite living miles away from our homeland.

“I always get excited when I meet fellow Malaysians, whether at work or during social functions,” the 37-year-old chartered surveyor said.

“We speak freely with our Malaysian accent and pepper our sentences with slang that only Malaysians understand.”

Wesley Tan of Wav Music Production said it was the vast opportunities in the entertainment industry in China that drew him to the Chinese capital 10 years ago.

“The market is huge with endless possibilities to grow and expand,” he said.

“We have to admit that we could not do as much in Malaysia, but it does not make me any less patriotic. I grew up in Malaysia and it will always be my home.”

The advantage of Malaysians, Tan said, is our ability to create products that appeal to an international target audience, with our tolerance and diverse background.

With Beijing being a fast-paced metropolis, the quality of life has plenty of room for improvement.

Air pollution and food safety aside, trust between people is thinning. Tan said he misses the courteous and caring ways of Malaysians.

“My parents-in-law, who are Chinese nationals, were so surprised that Malaysian drivers would actually pause to give way to opposite traffic during their visit to Kuala Lumpur,” he said.

The little gestures, such as placing one’s left hand on one’s right forearm when receiving or offering something, speak volumes about Malaysians’ pleasant disposition.

I couldn’t agree more.

Two weeks ago, I made a brief return to Malaysia. When waiting for my family to pick me up at the Kuala Lumpur International Airport, a Malay girl next to me kindly shared a packet of buah jeruk (pickled fruits) with me. In return, I offered her my chocolates.

We did not exchange names during our brief encounter; only smiles and snacks, but in that moment, I knew I was home.

Happy Merdeka.

Source: 
Check-in China by Tho Xin Yi The Star/Asia News Network

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Clive Palmer's racist 'bastards' hurts Australian more than Chinese!!

Aussie , Australia , Australian , British convicts , China , Chinese , Clive Palmer , Legislator , MP , Palmer United Party (PUP) , Politics , Racism , Racist rant

Clive Palmer - Australian mining mogul and member of parliament

Clive Palmer's tirade cannot be ignored

Clive Palmer, an Australian legislator and mining magnate, delivered a scathing harangue in a TV program on Monday, referring to the Chinese government as "bastards," who "shoot their own people" and want to usurp control of Australia. He called Chinese resources companies "mongrels," which send workers to destroy the wage system and take over Australian ports and plunder minerals for free.

This is the most vicious attack by one of the Australian elite in recent months.

Not long ago, Foreign Minister Julie Bishop and Prime Minister Tony Abbott also made bitter remarks against China without any reason, which was quite astonishing. Now Palmer's "bastards" ravings have intensified this.

On Tuesday, several government ministers and opposition parties in Australia damned Palmer's comments - a rare unanimous move - as an attack on Australia's biggest trading partner. However, China has already fallen victim to this foul war of words.

People can imagine what would come next if a Chinese politician or business tycoon made such unscrupulous remarks by calling a whole country "bastard." This person will be doomed. But in Australia, Palmer will probably not bear too much cost for his nonsense.

China cannot let him off, or show petty kindness just because the Australian government has condemned him. China must be aware that Palmer's rampant rascality serves as a symbol that Australian society has an unfriendly attitude toward China.

China should consider imposing sanctions on Palmer and his companies, cutting off all business contacts with him and forbidding him and his senior executives into China. The sanctions could also be given to any Australian companies which have business dealings with Palmer's. China must let those prancing provocateurs know how much of a price they pay when they deliberately rile us.

Australian society has been aware that Palmer crossed the red line too far and his remarks, along with those of Bishop and Abbott, pose a direct threat to Australian-Sino relations. Canberra is waiting for China's reactions, from which they can assess the tenacity of Chinese diplomacy.

If China generously accepts the condemnations against Palmer by Australian public opinion without taking solid action to punish him, this risks giving Australians the impression that China has too much good will to bother toning it down. On the contrary, Palmer could be the last straw for worsening Sino-Australian relations. How we respond will be a turning point for Australia's understanding of China.

Palmer should be damned as the culprit. Because of him, China must teach Canberra a lesson for sabotaging a bilateral relationship. Australia has picked sides and embraced the US and Japan, but in the meantime, it keeps racking up economic profits from China. This situation is making it a radical "double-dealer" among all the nations which have relationships with China.

Business with Australia should continue, but this country must be marginalized in China's global strategy. Canberra boasts about itself having so-called strategic values, most of which, however, are created out of its own delusions.

Hooligan politics is being employed by the Australian government to deal with China. But China shouldn't care too much about it, or it will only shock us once again.

Australia is a remote business partner, and a place where the Chinese can take a trip and learn some English. These basic understandings should be the starting points for China to re-orientate Sino-Australian relations.

Source:Global Times Published: 2014-8-20

Racism against China hurts Australia

When I studied at the University of Sydney in 2009 for a master's degree in media, I was surprised by the interest ordinary Australians had in China. Not only was China the topic for class discussions every week, one of my lecturers also told me during an after-class chat that she was sending her son to learn fencing in Shanghai in the upcoming summer holiday as China had emerged as an ideal place for his training. Later, my supervisor at a local magazine where I had a month's internship told me his son was studying Chinese at Beijing University of Languages and Culture, as he believed the language advantage would help his son find a job in Australia which was forging an increasingly closer bond with China.

He assigned me to write an article about how small and medium companies run by Australian-Chinese were faring and whether their connections with China actually helped their businesses. During my interviews, I was amazed that a rising number of Australian-Chinese were actually making a decent living out of exporting Australian products to China.

However, when news came earlier this month that China's Wanda Group had bought the famous Jewel Project on Australia's Gold Coast and planned to invest $900 million developing it into a luxury resort, I did not even raise my eyebrows. I also laughed it off when an Australian friend in Sydney sent an e-mail informing me that Chinese developers are also reshaping and rejuvenating Parramatta, a suburban city on the western edge of the city.

True, the depth and breadth of China-Australia ties have grown immensely since 2009 when I first set foot in the biggest country in the Southern hemisphere. Apart from lucrative trade, exchanges between the two peoples have also expanded rapidly.

More and more Chinese people have easier access to Australian products. Australia has become a popular destination for Chinese tourists and for Chinese students seeking education overseas.

With the rising presence of Chinese in Australia, there are reports of how Chinese buyers are ratcheting up property prices in major Australian cities, Sydney in particular.

To me, it is a natural trend toward a win-win outcome if more people from both China and Australia are visiting each other's country and doing business with each other in accordance with law and international practice.

Unfortunately, some in Australia seem not to agree with me. Some even harbor animosity to Australian-bound Chinese people or Chinese investments. There have been several incidents since last year in which Chinese passengers on Sydney trains were the targets of insults.

If these unhappy scenes are just the wrongdoings of some biased Australians, the TV rant against China staged by Australian billionaire-turned politician Clive Palmer last week reflects the ugly undercurrents of racism against Chinese and China beneath the rosy picture of China-Australia interaction.

On Tuesday, Palmer, obviously under huge pressure from the strong condemnation he had received from people in both China and Australia, apologized to the Chinese embassy in Canberra for calling the Chinese government "bastards" and "mongrels" in a media interview.

In a written statement, Palmer said, "I most sincerely apologize for any insult to the Chinese people caused by any of the language I used during my appearance on the ABC television program Q&A."

It is important that the mining tycoon's repentance is heart-felt, and the Australian society truly learns a bitter lesson from undesirable scenarios such as Palmer's TV outburst.

Racism and discrimination against outsiders could easily erode the credibility of a multicultural society such as Australia's, as well as ruin the very foundation of good feelings between Chinese and Australians, which is bedrock for healthy China-Australia cooperation

By Wang Hui (China Daily)/Asia News Network

Clive Palmer apologizes for 'bastards' comment 

 - Insults opportunity for Abbott to change course: community leader

Australian mining mogul and member of parliament Clive Palmer has apologized for calling Chinese people "bastards" in a recent TV interview, following wide-spread condemnation from both China and his home country.

Palmer, who was elected as senator last year and is leader of the Palmer United Party (PUP), made the apology in a letter to Ma Zhaoxu, Chinese Ambassador to Australia.

The letter, which was signed by Palmer on Monday, was released late on Monday.

"I regret any hurt or anguish such comments may have caused any party and I look forward to greater understanding for peace and cooperation in the future," he said, referring to comments he made in a live TV interview on August 18.

During the interview, Palmer said he didn't mind "standing up against the Chinese bastards," and claimed that the Chinese government wants to "take over our ports and get our resources for free."

In a statement posted on the embassy's website Tuesday, Ma stressed that the Chinese people are never to be insulted. "Any remarks attacking or slandering China will not gain support and are doomed to failure," he wrote.

The billionaire's slandering of China drew immediate protest from Chinese government last week. Australia's Prime Minister Tony Abbott also denounced the comments as "over the top, shrill and wrong."

On Tuesday morning, around 200 members of the Chinese community in Australia braved downpours to protest against Palmer's remarks outside Parliament House in Canberra.

"We have been in close contact with Palmer since last week, pressuring him to apologize. Learning that our request for Tuesday's protest was approved by police authorities, Palmer finally softened his stance and released the apology late Monday," said Qian Qiguo, head of the Australian Action Committee for Peace and Justice Incorporated, a group formed by members of the Australian Chinese community.

Palmer had defended himself last week saying his comments were directed at a Chinese company with whom he is locked in a legal dispute.

In the Monday apology, he said, "In keeping an open mind, I now come to the realization that what I said on Q&A was an insult to Chinese people everywhere and I wish to assure them they have my most genuine and sincere apology."

Qian told the Global Times the Chinese community was not satisfied with such remarks in the letter, and demanded Palmer to drop whole paragraph. "At 3:30 pm on Tuesday, Palmer finally sent us a second letter, which took out the unnecessary remarks, and the new edition was also sent to the Chinese ambassador," he said, claiming it a victory.

According to the Sydney Morning Herald, Australia's Foreign Minister Julie Bishop Tuesday welcomed Palmer's apology, but said it should have come earlier. She also called on Palmer's fellow PUP Senator Jacqui Lambie to "reflect on her words" after Lambie had also lashed out at Beijing.

Last week, while supporting Palmer, Lambie said Australia must build missile systems and defense shields to prepare for an invasion from China even if it costs $60 billion a year, reported The Australian.

As of press time, Lambie didn't respond to a Global Times' e-mail inquiry over her comments on Palmer's apology and whether she will apologize for her words.

Qian said the Chinese community had also contacted Lambie and the PUP, and was assured that she wouldn't make such provocative comments in the future.

Han Feng, a deputy director of the Institute of Asia-Pacific Studies at the Chinese Academy of Social Sciences, told the Global Times that the new party is trying to promote its visibility through its senators' strong rhetoric. But Palmer's "irresponsible and reckless" comments on China have clearly backfired.

China is Australia's biggest trade partner and about 1 million Chinese are living in the nation.

Palmer's slandering of China raised doubts whether Australian politicians' opinions toward China would fuel anti-China emotions in the country.

A video recently posted online shows an Australian woman racially abusing Asian-looking passengers on a train and demanding them to go back to China. The video triggered uproar on Chinese social media.

Qian said some people who held extremist anti-Asian and racial sentiments emerged years ago, but they are not the mainstream in Australia.

"Abbott and Bishop made some unfriendly remarks on China when they first came to office, but their immediate condemnations of Palmer this time offered an opportunity for them to correct their position," he said.

Han also noted that the Abbott administration's policy toward China has seen constant adjustments over the past year. "However, it is still concerned about a potential turbulence in the region if the US role is undermined … Canberra hopes that the US could keep its presence to safeguard the existing order. Therefore it is working with the US and Japan to prevent any 'China threat.'"

By Yang Jingjie Source:Global Times Published: 2014-8-27

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The US, which keeps trying to assimilate minorities in a barbaric way, never ceases to point fingers at China.