Everything You Know About China Is Wrong | Print Article | Newsweek.com - The Diigo Meta page

• 19 Oct 09
  

  juremes sss
• 18 Oct 09
  

  dan maertens

  weerlegging van 6 mythes

  • Even government officials now admit that 60 percent or more of the stimulus money has ended up in stock and real-estate markets, fueling worries about dangerous new asset bubbles. In some coastal cities, property sales are three times what they were last year; the Shanghai stock market is up over 60 percent this year. "It's just a stopgap measure—all the stimulus has been concentrated in building new infrastructure and reheating the property sector," says Chinese independent economist Andy Xie.
  • Last month Wen told a group of VIPs at the World Economic Forum in Dalian that China's rebound was "unstable, unbalanced, and unconsolidated." A week earlier Chi Fulun, a member of the Chinese People's Political Consultative Conference was blunter: "Chinese leaders," he said in an interview, "should rethink the country's reform package."
  • 8 more annotations...
  • • "Take a drive on one of those new rural highways; you won't see many cars," says Ming Huang, a finance professor at Beijing's Cheung Kong business school and Cornell University. "It's going to take a long time for this sort of investment to result in any kind of consumption boost."
    • The number of private enterprises in China doubled from 20 million in 1990 to 40 million in 2008.
    • State companies have easy access to 3 percent loans from state-owned banks, while private companies pay double-digit rates and are often forced to tap underground markets for funding.
    • "That's bad news for domestic demand, because it means that individuals will control a smaller share of the economy. Households are already supporting state-owned enterprises with their savings, which are given to these mostly inefficient businesses via state-owned banks at very low interest rates."
    • If that really were true, why is it that exports are down 20 percent this year, but the economy is still up by 8 percent? "While exports are important to China, in the same way that they are important to Japan or Germany, it's not the only thing going on here,"
    • Net exports account for just over 7 percent of China's GDP.
    • "Quite simply, there is little real innovation or branding ability in China," says Beijing University professor Michael Pettis.
    • Why spend money to become more globally competitive when you have a monopoly in the world's most populous country?

Would you like to comment?

Join Diigo for a free account, or sign in if you are already a member.