Emerging and Frontier Markets: Economic and Geopolitical Analysis

[LeveragedBuyout]

After conferring with @Nihonjin1051 , I am opening this thread to discuss geopolitical and economic issues that do not fit well into the existing specialized forums that already exist on PDF. I will start the conversation with a topical article from a few days ago:

http://blogs.ft.com/beyond-brics/2014/09/05/turkey-latin-america-lead-em-vulnerability-ranking/

Turkey, Latin America lead EM vulnerability ranking
Sep 5, 2014 6:50pmby James Kynge
10

US jobs growth slowed in August, contradicting a host of other data showing strength in the world’s largest economy. Nevertheless, the weak data is unlikely to sway the US Federal Reserve from hiking rates next year, though it is possible that its language may now turn a little less hawkish.

So while US monetary tightening remains in prospect, it makes sense to assess which EM countries have worked hard to shore up their vulnerabilities to prepare for the receding tides of liquidity – and which have failed to do so.

The chart below shows stark geographical divisions. Frailties have deepened in five out of six selected Latin American countries but receded in five out of six economies in emerging Europe and Africa, and in two out of three Asian nations, according to four criteria selected by Capital Economics.



Source: Capital Economics
Capital Economics chose to look at vulnerabilities only in those EM countries that run a current account deficit, since those economies rely most heavily on external financing and are therefore most susceptible to a drying up of global liquidity. These were also the countries hit in previous “taper tantrums” last year and early this year.

Aside from the current account, the other three areas of exposure to dwindling liquidity are short-term external debt (which requires international financing), foreign currency reserves (which reveal the extent of dependency on capital inflows) and real interest rates (the higher they are, the easier it is to attract international capital).

“While we don’t expect the Fed to jump on the brakes, we do expect it to raise rates sooner than most in the market expect (our forecast is March 2015) and, ultimately, by more than most in the market expect,” said Capital Economics in a report on Friday.

“Against this backdrop, there is a clear possibility of renewed turbulence in EM financial markets,” the report added.

Turkey looks most vulnerableOf these four yardsticks, the most crucial is the current account deficit – and on this measure, many EM economies are in a stronger position than they were a year ago. The exceptions are Turkey, Brazil, Colombia and Argentina (see chart).

Turkey has the largest current account deficit, at more than 6 per cent of GDP, while South Africa, Peru and Brazil also look shaky.


Source: Capital Economics

The outlook for Turkey is similarly bleak when their short-term domestic debt is considered. Not only has this increased from a year ago, it is high as a proportion of GDP (see chart).


Source: Capital Economics

So is the EM rally in danger?Investors in EM stocks and bonds have prospered since the last “taper tantrum” began to abate in February, with the MSCI EM index up 20 per cent since its February low and overall yields on EM sovereign debt down 0.7 per cent to 5.4 per cent in the year to date.

So, is there a danger that market conditions could soon deteriorate. Of course, there are a variety of opinions, but for many the key yardstick is the yield on the 10-year US Treasury bond.

“Wake me up when the 10-year (US Treasury) hits 3 per cent,” said Benoit Anne, head of emerging markets strategy at SocGen. “Until then, I am setting my ‘buy global emerging markets’ signal on automatic pilot.”

“In my empirical study about the impact of higher US rates on EM, I showed that only a 55bp US Treasury shock is large enough and even then, the conclusion is very mixed on the market response in EM,” added Anne. “In other words, the EM rally is well alive and kicking, and will only come to a stop when we hit the valuation walls.”


Source: Thomson Reuters



The chart above shows that the yield on the 10-year US Treasury bond today was considerably lower than the 3 per cent level, at 2.38 per cent.

 

[Aepsilons]

Excellent good Sir ! Thank You!

 

[LeveragedBuyout]

This might be a good place to post an article that I came across several years ago, but which provides an interesting perspective on the question of how countries move from emerging to developed status. This set of guidelines appears to be particularly relevant to India as Modi embarks on his reform program. The points about Korea and Singapore re-positioning themselves also provide relevant lessons for China under Xi's own reform program.

Finance & Development, December 2008 - Picture This

The Ingredients of Sustained High Growth

Since 1950, 13 economies have managed to grow at an average rate of 7 percent or more for at least 25 years in a row. How did they do it? And, more important, can such high growth be repeated in other countries on a sustained basis? For over two years, these were the questions that guided the work of the Commission on Growth and Development, comprising leaders from business, government, and academia, including two Nobel laureates.

Diversified and engaged
Sustained fast growth is not a miracle—it is possible for developing countries, as long as their leaders are committed to it and take advantage of the opportunities provided by the global economy. The 13 successes identified by the Commission (see table) include the familiar Asian examples, but the list is otherwise well diversified in terms of size, resource endowment, and political regime.

Since economies can learn faster than they can invent, developing countries can catch up through much faster growth than was experienced by today's industrialized countries when they were creating their own growth levers. Even with high rates, catching up is a long-term process that takes two generations or more.

Critical to success is engagement with the global economy that enables developing countries to import knowledge and technology, to access markets, and to generate a strong export sector, which is especially important in the early stages of growth.

The five common characteristics of sustained high growthIn addition to engaging with the global economy, these high-growth countries share other important characteristics. Macroeconomic stability—which includes relatively low inflation and avoidance of excessive debt—helped them ride out economic shocks and uncertain investment horizons. Their economic policies and collective choices were oriented toward the future, helping them achieve high investment and saving rates.

These 13 countries also relied on markets, including mobility of labor, to allocate resources. And strong leadership—in the form of individuals, parties, or political systems—forged a consensus around the goals of growth and development, and ensured the process was inclusive and fair in terms of opportunities.

How did they do it?
Six of the economies—Hong Kong SAR, Japan, Korea, Malta, Singapore, and Taiwan Province of China—continued to grow all the way to high-income levels. But several lost momentum before catching up with industrialized nations. The most striking example is Brazil (see next box).

It is not easy—or common—for middle-income countries to reach high income. The first priority for policymakers is to anticipate this transition and the new demands it will make of them.

Korea, for example, changed its policies and public investments in the 1980s and the 1990s to help the economy's evolution from labor-intensive manufacturing to a more knowledge- and capital-intensive economy.

The second priority is for countries to let go of some of their earlier policies, even the successful ones. Singapore, for example, responded to evolving economic conditions at home and abroad by allowing labor-intensive manufacturing to migrate elsewhere in the region, where labor was cheaper. It even ran special economic zones in China and India.

Brazil's slowdown
Brazil, one of the first countries to achieve sustained high growth, began to slow down in 1980. The country suffered inflation and debt overhang from the 1973 oil shock.

Instead of seeking to expand exports, it turned inward in 1974 and extended a policy of protecting light manufacturing domestic industries to heavy industries and capital goods production.

Brazil's exchange rate appreciated dramatically and its exporters lost much of the ground they had gained in previous decades. When dollar interest rates spiked in 1979, Brazil was plunged into a debt crisis from which it took more than a decade to emerge.

New global challenges
Countries embarking on a high-growth strategy today must overcome some global trends their predecessors did not face. These include global warming; the falling relative price of manufactured goods and rising relative price of commodities, including energy; swelling discontent with globalization in advanced and some developing economies; the aging of the world's population, even as poorer countries struggle to cope with a "youth bulge"; and a growing mismatch between global problems—in economics, health, climate change, and other areas—and weakly coordinated international responses.

But whatever the challenges, the strength of the global economy remains central for rapid growth in developing countries.

www.growthcommission.org


----

LeveragedBuyout's comments:

Here's an interesting bit of trivia. I took the first chart from the article (showing how per capita GDP changed in the selected countries over the period of high growth), and calculated the compound annual growth rate of per capita GDP. Here are the results:

Botswana: 6.65%
Brazil: 4.87%
China: 6.06%
Hong Kong: 6.32%
Indonesia: 4.97%
Japan: 8.73%
Korea: 6.25%
Malaysia: 5.89%
Malta: 7.24%
Oman: 5.93%
Singapore: 7.24%
Taiwan: 6.68%
Thailand: 5.51%

I've set in bold those cases that appear particularly interesting. First, note Japan's world-beating performance--the original "Asian Tiger" set the stage for the others in more ways than one, but it appears to have executed the model particularly well (probably due to its culture of strong institutions, but we can save that discussion for another time). Nihon Banzai! The other outlier is Botswana, which indicates that high growth is possible no matter what the location, as long as the ingredients of high growth as specified in the article are followed. That said, it will be harder than ever for developing countries to catch up to the rich country club, as detailed in the end of the article. The window is closing, so countries need to take advantage of the reforms that they are able to, while they can still exploit them to their advantage.

 

[tranquilium]

This might be a good place to post an article that I came across several years ago, but which provides an interesting perspective on the question of how countries move from emerging to developed status. This set of guidelines appears to be particularly relevant to India as Modi embarks on his reform program. The points about Korea and Singapore re-positioning themselves also provide relevant lessons for China under Xi's own reform program.

Finance & Development, December 2008 - Picture This

The Ingredients of Sustained High Growth

Since 1950, 13 economies have managed to grow at an average rate of 7 percent or more for at least 25 years in a row. How did they do it? And, more important, can such high growth be repeated in other countries on a sustained basis? For over two years, these were the questions that guided the work of the Commission on Growth and Development, comprising leaders from business, government, and academia, including two Nobel laureates.

Diversified and engaged
Sustained fast growth is not a miracle—it is possible for developing countries, as long as their leaders are committed to it and take advantage of the opportunities provided by the global economy. The 13 successes identified by the Commission (see table) include the familiar Asian examples, but the list is otherwise well diversified in terms of size, resource endowment, and political regime.

Since economies can learn faster than they can invent, developing countries can catch up through much faster growth than was experienced by today's industrialized countries when they were creating their own growth levers. Even with high rates, catching up is a long-term process that takes two generations or more.

Critical to success is engagement with the global economy that enables developing countries to import knowledge and technology, to access markets, and to generate a strong export sector, which is especially important in the early stages of growth.

The five common characteristics of sustained high growthIn addition to engaging with the global economy, these high-growth countries share other important characteristics. Macroeconomic stability—which includes relatively low inflation and avoidance of excessive debt—helped them ride out economic shocks and uncertain investment horizons. Their economic policies and collective choices were oriented toward the future, helping them achieve high investment and saving rates.

These 13 countries also relied on markets, including mobility of labor, to allocate resources. And strong leadership—in the form of individuals, parties, or political systems—forged a consensus around the goals of growth and development, and ensured the process was inclusive and fair in terms of opportunities.

How did they do it?
Six of the economies—Hong Kong SAR, Japan, Korea, Malta, Singapore, and Taiwan Province of China—continued to grow all the way to high-income levels. But several lost momentum before catching up with industrialized nations. The most striking example is Brazil (see next box).

It is not easy—or common—for middle-income countries to reach high income. The first priority for policymakers is to anticipate this transition and the new demands it will make of them.

Korea, for example, changed its policies and public investments in the 1980s and the 1990s to help the economy's evolution from labor-intensive manufacturing to a more knowledge- and capital-intensive economy.

The second priority is for countries to let go of some of their earlier policies, even the successful ones. Singapore, for example, responded to evolving economic conditions at home and abroad by allowing labor-intensive manufacturing to migrate elsewhere in the region, where labor was cheaper. It even ran special economic zones in China and India.
Brazil's slowdown
Brazil, one of the first countries to achieve sustained high growth, began to slow down in 1980. The country suffered inflation and debt overhang from the 1973 oil shock.

Instead of seeking to expand exports, it turned inward in 1974 and extended a policy of protecting light manufacturing domestic industries to heavy industries and capital goods production.

Brazil's exchange rate appreciated dramatically and its exporters lost much of the ground they had gained in previous decades. When dollar interest rates spiked in 1979, Brazil was plunged into a debt crisis from which it took more than a decade to emerge.
New global challenges
Countries embarking on a high-growth strategy today must overcome some global trends their predecessors did not face. These include global warming; the falling relative price of manufactured goods and rising relative price of commodities, including energy; swelling discontent with globalization in advanced and some developing economies; the aging of the world's population, even as poorer countries struggle to cope with a "youth bulge"; and a growing mismatch between global problems—in economics, health, climate change, and other areas—and weakly coordinated international responses.

But whatever the challenges, the strength of the global economy remains central for rapid growth in developing countries.

www.growthcommission.org


----

LeveragedBuyout's comments:

Here's an interesting bit of trivia. I took the first chart from the article (showing how per capita GDP changed in the selected countries over the period of high growth), and calculated the compound annual growth rate of per capita GDP. Here are the results:

Botswana: 6.65%
Brazil: 4.87%
China: 6.06%
Hong Kong: 6.32%
Indonesia: 4.97%
Japan: 8.73%
Korea: 6.25%
Malaysia: 5.89%
Malta: 7.24%
Oman: 5.93%
Singapore: 7.24%
Taiwan: 6.68%
Thailand: 5.51%

I've set in bold those cases that appear particularly interesting. First, note Japan's world-beating performance--the original "Asian Tiger" set the stage for the others in more ways than one, but it appears to have executed the model particularly well (probably due to its culture of strong institutions, but we can save that discussion for another time). Nihon Banzai! The other outlier is Botswana, which indicates that high growth is possible no matter what the location, as long as the ingredients of high growth as specified in the article are followed. That said, it will be harder than ever for developing countries to catch up to the rich country club, as detailed in the end of the article. The window is closing, so countries need to take advantage of the reforms that they are able to, while they can still exploit them to their advantage.

I want to note something on Chinese growth. Notice the start date of Chinese high growth? It is 1960, right after the Great Leap Forward which many foreign source likes to cite as a disaster. The truth is, while there are certainly many problems that appeared during the Great Leap Forward and many lesson in managing a country to be learned, but the overall direction is right and the result shows.

Basically, emerging economies do not have the time or competitiveness to gather starting capital like their European/American counterparts. So it is much more important for them to concentrate whatever limited amount of resource they can muster and put them into key industrial sector. You NEED to get the backbone of your industry setup, even at the cost of creature comforts.

 

[LeveragedBuyout]

I want to note something on Chinese growth. Notice the start date of Chinese high growth? It is 1960, right after the Great Leap Forward which many foreign source likes to cite as a disaster. The truth is, while there are certainly many problems that appeared during the Great Leap Forward and many lesson in managing a country to be learned, but the overall direction is right and the result shows.

Basically, emerging economies do not have the time or competitiveness to gather starting capital like their European/American counterparts. So it is much more important for them to concentrate whatever limited amount of resource they can muster and put them into key industrial sector. You NEED to get the backbone of your industry setup, even at the cost of creature comforts.

Excellent distillation. Choose an industry, and specialize in it in order to grow capital that can be invested into ancillary industries. It's the classic model: agriculture to light industry (e.g. textiles) to heavy industry (e.g. steel production, shipbuilding) to R&D and services. Europe and the United States did it, then a century later, Japan did it, the Asian Tigers did it, China did it. Now it's everyone else's turn. But the clock is ticking: can the remaining emerging markets be competitive in light industry in the age of robotic manufacturing?

 

[tonyget]

Japan is facing deflation problem
China is facing inflation problem

 

[tranquilium]

Japan's case is very interesting to note. Japan is different from the other Asian tigers or Asian economy in that it is the only industrial country in East/Southeast Asia prior to WWII (If you disregard USSR that is. The only Asian country at 1950 that comes close to Japan is actually Philippine.)

Its high growth Post-WWII has political related reason as well. In 1950, Korean war started, while Chinese intervention would not occur until the end of the year, the Korean Peninsula has become the first major proxy war battleground in the cold war. As a result, Japan is in a position to serve as the front base of US/NATO sphere of influence in East Asia; consequent, major US investment poured in and greatly accelerate Japanese economic development. This is a text book example of country taking advantage of international political events to advance itself. (A side note, China did similar things in 1950s, where USSR helped China to build a lot of infrastructure base due to its need of a strong partner in cold war. This included getting China started on nuclear weapons program.)

Of course, what truly allowed it to take advantage of the opportunity and excel are two things:
1. The existing Japanese industrial base, even though damaged in WWII, was still much better than any other emerging economies at the time.
2. Its massive population is one of the deciding advantage Japan has over the other Asian tigers. While country/regions like South Korea, Taiwan or Singapore also had fast development, their size and population simply means even if they realize their full potential, they would fall short since their potential only goes so far. While Japan's size also couldn't compete with likes of US, USSR or China, its population is very respectable and its size is comparable to European countries as well.

What's the lesson to take from here? Opportunities do exist and can do wonders, but only if you have the resource and infrastructure to actually take it.

 

[Jlaw]

Japan is facing deflation problem
China is facing inflation problem

Inflation better than deflation. But it should still be controlled. It's easier to control inflation than deflation.

 

[tranquilium]

Japan is facing deflation problem
China is facing inflation problem

Inflation better than deflation. But it should still be controlled. It's easier to control inflation than deflation.

While Japan's deflation problem is certainly true, historical data has a different opinion on Chinese inflation:

Historic inflation China – historic CPI inflation China
CPI China 2014 2.27 %
CPI China 2013 2.57 %
CPI China 2012 2.62 %
CPI China 2011 5.53 %
CPI China 2010 3.17 %
CPI China 2009 -0.72 %
CPI China 2008 5.97 %
CPI China 2007 4.82 %
CPI China 2006 1.65 %
CPI China 2005 1.78 %
CPI China 2004 3.84 %
CPI China 2003 1.13 %
CPI China 2002 -0.73 %
CPI China 2001 0.73 %
CPI China 2000 0.35 %
CPI China 1999 -1.40 %
CPI China 1998 -0.77 %
CPI China 1997 2.81 %
CPI China 1996 8.33 %
CPI China 1995 17.07 %
Typically, between 1% to 5% inflation is considered healthy and optimal.

As far as inflation goes, Chinese inflation rate is the worst around 1990s, where China goes the economic transition after ten years of open-door policy. Many people on these forums are not old enough to realize it, but 1990s is actually a make or break period for Chinese economy where not only is the economy adjusting for the sudden increase in capital and wealth. The society itself is facing value changes and many problem that appeared with increased wealth. Basically, had China broke down back then, it would have been like Brazil or India instead what it is today. Comparing to the 1990s, the economy transition faced by China today is a cakewalk.

 

[tonyget]

Chinese inflation rate is the worst around 1990s, where China goes the economic transition after ten years of open-door policy. Many people on these forums are not old enough to realize it, but 1990s is actually a make or break period for Chinese economy where not only is the economy adjusting for the sudden increase in capital and wealth. The society itself is facing value changes and many problem that appeared with increased wealth. Basically, had China broke down back then, it would have been like Brazil or India instead what it is today. Comparing to the 1990s, the economy transition faced by China today is a cakewalk.

Many people say that cost of living is cheaper in the US than in China

 

[tranquilium]

Many people say that cost of living is cheaper in the US than in China

I live in US. There are certain items that is cheaper in US, particular the luxury goods which China has a 100% import tax, but in general living is much cheaper in China than US.

 

[Jlaw]

Believe me as I lived for a short time in US. If you make $50k USD/year in China, you're better off than making $50k USD/year in the USA.

 

[LeveragedBuyout]

Japan's case is very interesting to note. Japan is different from the other Asian tigers or Asian economy in that it is the only industrial country in East/Southeast Asia prior to WWII (If you disregard USSR that is. The only Asian country at 1950 that comes close to Japan is actually Philippine.)

Its high growth Post-WWII has political related reason as well. In 1950, Korean war started, while Chinese intervention would not occur until the end of the year, the Korean Peninsula has become the first major proxy war battleground in the cold war. As a result, Japan is in a position to serve as the front base of US/NATO sphere of influence in East Asia; consequent, major US investment poured in and greatly accelerate Japanese economic development. This is a text book example of country taking advantage of international political events to advance itself. (A side note, China did similar things in 1950s, where USSR helped China to build a lot of infrastructure base due to its need of a strong partner in cold war. This included getting China started on nuclear weapons program.)

Of course, what truly allowed it to take advantage of the opportunity and excel are two things:
1. The existing Japanese industrial base, even though damaged in WWII, was still much better than any other emerging economies at the time.
2. Its massive population is one of the deciding advantage Japan has over the other Asian tigers. While country/regions like South Korea, Taiwan or Singapore also had fast development, their size and population simply means even if they realize their full potential, they would fall short since their potential only goes so far. While Japan's size also couldn't compete with likes of US, USSR or China, its population is very respectable and its size is comparable to European countries as well.

What's the lesson to take from here? Opportunities do exist and can do wonders, but only if you have the resource and infrastructure to actually take it.

Great point. The importance of the Korean War to Japan should not be underestimated; indeed, some argue that the Korean War essentially saved Japan. Interestingly, Japan was starting to suffer from deflation at the time, with inventories rising and prices declining, Japanese industry was struggling to get on its feet, so the Korean War was a godsend. G.C. Allen in "Japan's Economic Recovery" (1958) estimated that American procurement of Japanese supplies during the Korean War accounted for 27% of Japan's exports.

You know what they say about luck. Luck = preparation + opportunity. As you say, countries that hope to grow need to be prepared to exploit the opportunities that come their way.

 

[Hamartia Antidote]

Many people say that cost of living is cheaper in the US than in China

Cost Of Living Comparison Between China And United States

China United States
Restaurants[Edit][Edit]
Meal, Inexpensive Restaurant22.00 ¥ 61.34 ¥
Meal for 2, Mid-range Restaurant, Three-course150.00 ¥ 276.04 ¥
Combo Meal at McDonalds or Similar27.00 ¥ 39.87 ¥
Domestic Beer (0.5 liter draught)8.00 ¥ 21.47 ¥
Imported Beer (0.33 liter bottle)25.00 ¥ 30.67 ¥
Cappuccino (regular)27.02 ¥ 22.51 ¥
Coke/Pepsi (0.33 liter bottle)3.48 ¥ 9.87 ¥
Water (0.33 liter bottle)2.14 ¥ 7.91 ¥
Markets[Edit][Edit]
Milk (regular), (1 liter)13.35 ¥ 6.17 ¥
Loaf of Fresh White Bread (500g)10.55 ¥ 14.88 ¥
Rice (white), (1kg)6.52 ¥ 18.40 ¥
Eggs (12)11.77 ¥ 14.08 ¥
Local Cheese (1kg)93.09 ¥ 58.56 ¥
Chicken Breasts (Boneless, Skinless), (1kg)25.95 ¥ 47.57 ¥
Apples (1kg)11.46 ¥ 23.41 ¥
Oranges (1kg)11.26 ¥ 22.88 ¥
Tomato (1kg)8.08 ¥ 23.48 ¥
Potato (1kg)5.79 ¥ 14.70 ¥
Lettuce (1 head)4.47 ¥ 9.63 ¥
Water (1.5 liter bottle)3.90 ¥ 10.84 ¥
Bottle of Wine (Mid-Range)80.00 ¥ 73.61 ¥
Domestic Beer (0.5 liter bottle)4.60 ¥ 14.11 ¥
Imported Beer (0.33 liter bottle)14.11 ¥ 20.08 ¥
Pack of Cigarettes (Marlboro)15.00 ¥ 36.81 ¥
Transportation[Edit][Edit]
One-way Ticket (Local Transport)2.00 ¥ 12.27 ¥
Monthly Pass (Regular Price)120.00 ¥ 429.40 ¥
Taxi Start (Normal Tariff)11.00 ¥ 18.40 ¥
Taxi 1km (Normal Tariff)2.40 ¥ 9.53 ¥
Taxi 1hour Waiting (Normal Tariff)35.00 ¥ 183.42 ¥
Gasoline (1 liter)7.95 ¥ 5.90 ¥
Volkswagen Golf 1.4 90 KW Trendline (Or Equivalent New Car)150,000.00 ¥ 127,685.45 ¥
Utilities (Monthly)[Edit][Edit]
Basic (Electricity, Heating, Water, Garbage) for 85m2 Apartment339.10 ¥ 983.36 ¥
1 min. of Prepaid Mobile Tariff Local (No Discounts or Plans)0.33 ¥ 0.95 ¥
Internet (6 Mbps, Unlimited Data, Cable/ADSL)117.85 ¥ 287.69 ¥
Sports And Leisure[Edit][Edit]
Fitness Club, Monthly Fee for 1 Adult238.46 ¥ 241.48 ¥
Tennis Court Rent (1 Hour on Weekend)85.56 ¥ 114.21 ¥
Cinema, International Release, 1 Seat70.00 ¥ 61.34 ¥
Clothing And Shoes[Edit][Edit]
1 Pair of Jeans (Levis 501 Or Similar)625.91 ¥ 253.34 ¥
1 Summer Dress in a Chain Store (Zara, H&M, ...)324.58 ¥ 222.41 ¥
1 Pair of Nike Shoes670.56 ¥ 473.51 ¥
1 Pair of Men Leather Shoes630.14 ¥ 518.16 ¥
Rent Per Month[Edit][Edit]
Apartment (1 bedroom) in City Centre3,884.85 ¥ 6,261.43 ¥
Apartment (1 bedroom) Outside of Centre2,141.08 ¥ 4,707.66 ¥
Apartment (3 bedrooms) in City Centre8,464.39 ¥ 10,623.06 ¥
Apartment (3 bedrooms) Outside of Centre4,635.07 ¥ 8,004.42 ¥
Buy Apartment Price[Edit][Edit]
Price per Square Meter to Buy Apartment in City Centre33,616.57 ¥ 11,750.69 ¥
Price per Square Meter to Buy Apartment Outside of Centre17,035.27 ¥ 7,689.31 ¥
Salaries And Financing[Edit][Edit]
Average Monthly Disposable Salary (After Tax)4,520.41 ¥ 20,237.13 ¥
Mortgage Interest Rate in Percentages (%), Yearly6.25 4.20
Last update


keep in mind this
Average Monthly Disposable Salary (After Tax) 4,520.71 ¥ 20,267.47 ¥ +348.33 %

Believe me as I lived for a short time in US. If you make $50k USD/year in China, you're better off than making $50k USD/year in the USA.

Well of course. But you'd live better in Kenya than in China.

 

[tonyget]

I live in US. There are certain items that is cheaper in US, particular the luxury goods which China has a 100% import tax, but in general living is much cheaper in China than US.

You know that many good quality products aren't available in China, despite that those goods being manufactured in China, they are for export only