Is the Chinese economy faltering? What is going on over there? I provide some insights into the rebalancing act happening in China in my latest Forbes post: http://blogs.forbes.com/annlee/
I wrote a piece for Forbes explaining that contrary to what many analysts say, the enormous investments in infrastructure in China will be good for the economy and also visionary on the part of China’s leadership: http://www.forbes.com/sites/annlee/2012/07/22/why-chinas-high-investment-levels-wont-hurt-them/
The Latin American Advisor, a magazine focused on developments in Latin America, asked for my thoughts on the future of the Asia-Latin America trade corridor. The piece that followed showcased my opinion along with two others. Take a look at what we have to say here.
Reuters has reported that a bill about to be signed by Obama will allow existing tariffs on imported goods from China to stay in place after they were threatened by a court ruling. At a time when there seems to be little bipartisan support for anything, it is surprising that this piece of legislation enjoys popularity from both sides of the aisle. Certainly, there is a broad perception in the U.S. that China does not play by the rules, that the U.S. engages in free market capitalism while China engages in mercantilism.
Unfortunately, like all disagreements, the truth is not black and white, but shades of gray. Continue reading
The World Bank and China’s Development Research Center released a report calling for China to make a number of economic reforms in order to develop a more sustainable economy. This was widely reported in the New York Times, Washington Post, and Seattle Times. It claims that China cannot sustain growth unless it does a long laundry list of things. Why the Chinese would listen to outgoing World Bank President Robert Zoellick is a bit puzzling since he was part of senior management at Goldman Sachs just prior to joining the World Bank and thus likely has Goldman’s interests, not China’s interests, at heart.
Recommendations they made that I agree with include the following: Continue reading
1. The Chinese Central bank (PBOC) will relax interest rates.
2. The Chinese banks will return to easy lending.
3. The expected real estate bubble will not
burst the Chinese economy because the Chinese government will soften real estate
4. Chinese consumption will creep towards
40% of GDP.
5. Wang Qishan will be the Premier.
6. China will create more small banks to
lend to SMEs and TVEs.
7. China will use the north Canton area to
experiment with democracy as a way to solve the land grab issue.
8. The Hong Kong Stock Exchange will be
allowed to trade in China and link up with the Shanghai Stock exchange to
create a world powerhouse.
9. China will team up with the Eurozone to
set up an International Currency Regulatory Authority.
10. China will create an Asian currency bloc with Japan and S.