China Economy Forum

[Ayush]

That is more than impressive

 

[faithfulguy]

Let's see India's Growth rate decreases or increases hereafter.
You will be getting the answers from three months onward. India is having an "U" shape recovery, not a "V" shape.

And your prediction of the India growth has not been shared by reality. I know you want India to grow so much, but just like India creating a fight jet, its not a reality.

 

[Psyops]

Rupee devaluation is not a worrying prospect in my view, look how your CCP devalues its currency against dollar intentionally.

Rupee is not devaluing, it's collapsing because global investors have lost faith in your economy. The RMB has been appreciating over 30% since 2005. It's never devalued against the dollar. RMB has risen ALOT because we run current account surpluses and global investors have faith in our economy. They vote with their actions.

Rupee has stopped depreciating. It's appreciating gradually.

Yea going from early 40's to nearly 60 isn't depreciating, that's a full blown collapse.

 

[Srinivas]

Rupee is not devaluing, it's collapsing because global investors have lost faith in your economy. The RMB has been appreciating over 30% since 2005. It's never devalued against the dollar. RMB has risen ALOT because we run current account surpluses and global investors have faith in our economy. They vote with their actions.

These days even Dollar is not a standard currency, the good news is that inflation of our country is coming down to around 4%.

FDI are increasing these days since the wages are low and human resources are there

FDI may increase to $36 bn in 2013-14: PMEAC

The PM’s Economic Advisory panel expects foreign direct investment (FDI) in India to increase to $36 billion this fiscal on the back of supportive policies.

“For 2013-14, we are projecting that with supportive policies it is possible to generate higher levels of inbound FDI flows of the order of $36 billion, comparable to four of the previous six years,” the Prime Minister’s Economic Advisory Council (PMEAC) report said.

The outbound FDI is also expected to increase, resulting in net FDI inflow of $24 billion, it said.

From 2007-08 to 2009-10, the annual foreign inflows ranged from $33-35 billion, while outbound FDI was $14-19 billion.

During the first nine months of the 2012-13 fiscal, India received foreign inflows worth $21 billion, lower than the $29 billion in the corresponding period of 2011-12.

The outbound FDI was marginally smaller and the net inflow of $15 billion in the first nine months of 2012-13 was significantly smaller than the $21 billion in the same period of the previous year.

PMEAC has estimated that for the entire 2012-13, FDI into the country may reach at $26 billion, while outbound FDI may touch $8 billion.

On portfolio investment, it said that in 2012-13, inflows were weak in the first quarter, but picked up in the second and third quarters, totalling more than $16 billion in the first nine months.

For the year as whole, portfolio inflows are estimated to be close to $24 billion, it added.

“In 2013-14, we projected a level of inflow somewhat lower than that of the previous year. Maintaining this level will be mostly dependant on domestic policy stance and growth conditions. Abrupt weakening of international risk appetite can pose a problem, but at the moment crisis conditions are not expected,” it said.

FDI may increase to $36 bn in 2013-14: PMEAC | The Hindu

 

[Psyops]

Your real inflation is wayyyy higher than what's officially reported. I don't buy that for a second. Indian rupee collapsing proves your inflation is way higher. FDI prediction are utterly useless, predictions don't matter in economics.
The collapse of the rupee shows the Indian economy is in dire straits.

 

[shuttler]

These days even Dollar is not a standard currency, the good news is that inflation of our country is coming down to around 4%.

that is the industrial cpi isnt it? what is your consumer's cpi?

FDI may increase to $36 bn in 2013-14: PMEAC | The Hindu

if the amount represents the whole fiscal year of india then it is $2 billion less than our FDI inflow for the first 4 months of 2013.
india has a weak balance sheet and poor current a/c performance as usual
you have a double deficits
your fx reserve can only last for 6 months of import payments
your rupee is at the mercy of the us dollar and free falling to record lows. it is one of the worse performing currencies in asia

how much of those can you brag about?

ps you have to pray a lot for the crops during this monsoon season!

 

[cirr]

This is far from enough。

Guangdong must do a France，at least a Spain，before 2030.

So its infrastructure density，including motorway and railway density，must match those of France or Spain。

Guangdong has got a long long way to go。


China's Guangdong to invest $126 bn in infrastructure

By PTI | 14 Jun, 2013

BEIJING: China's southern economic powerhouse, Guangdong province, is expected to further invest $126 billion (775.1 billion yuan) to improve its transportation infrastructure by 2016, an official has said.

The investment will cover 89 new projects, which include highways and inter-city railways, said Cai Muling, deputy director of the provincial development and reform commission, the provincial economic planning body.


About 62 per cent of the investment will come from market financing, including bank loans, trust investment, medium-term notes and private capital.

About 62 per cent of the investment will come from market financing, including bank loans, trust investment, medium-term notes and private capital, Cai was quoted as saying by the state-run Xinhua news agency.

According to the province's 12th five-year plan (2011-2015), total investment in transportation infrastructure will hit 1.9 trillion yuan in the five-year period.

The investment realized in 2011 and 2012 stood at just 251.4 billion yuan, far below the target.

A provincial government plan released in April stated that Guangdong is expected to have 4,100 km of railways and 6,800 km of expressways in operation by the end of 2015.（too little compared with France or Spain，two EU countries with twice the landsize but 5-9 times more km of rails and much smaller population）

Guangdong leads the country in terms of economic development.

China's Guangdong to invest $126 bn in infrastructure - The Economic Times

 

[illusion8]

(Reuters) - Fake invoicing inflated China's official import and export totals by $75 billion in the first four months of 2013, local media reported on Friday, citing an internal review by China's commerce ministry.

An alternate estimate found that actual year-on-year export growth for January to April was only around 7 percent, while import growth was about 6 percent, the 21st Century Business Herald reported, citing an unidentified source and an internal commerce ministry document.

The second estimate was based on excluding data from the port of Shenzhen, where much of the fraud is suspected to have occurred.

Evidence has been growing in recent weeks that the world's second-largest economy is fast losing momentum, but suspect trade data has clouded the picture for global investors.

China's customs administration officially reported export growth of 17.4 percent in the first four months of the year, while imports officially grew 10.6 percent.

But analysts widely suspected that the data was distorted by inflated invoices used to circumvent China's strict capital controls and profit from appreciation of the Chinese currency.

Reported trade growth nose-dived in May, with exports rising only 1 percent and imports falling 0.3 percent.

The sharp drop occurred after China's customs agency promised to probe inconsistencies between China's export data and data on Chinese imports published by trading partners such as Hong Kong.

China's foreign exchange regulator also issued new rules in early May strengthening oversight of trade invoicing.

The $75 billion estimate was based on an examination of logistics data from China's special customs regulation zones. Such zones are the site of China's bonded warehouses, where analysts suspect much of the fake invoicing occurred.

Bonded warehouses are physically located inside China, but domestically-produced goods stored there have already cleared customs and are therefore counted as exports.

Imports and exports to and from the special regulation zones increased by 130 percent year-on-year in January through April, compared to only 19.1 percent in May, after tighter oversight began.

Assuming the true growth rate for January through April was similar to the reported growth rate in May produces an estimate of $75 billion in fake trade. That compares to official data showing combined imports and exports totaling $1.33 trillion in the same period.

China estimates fake trade invoicing at $75 billion in Jan-April - report | Reuters

 

[shuttler]

I have commented on this on another thread

It was about the global QE and control of the capital accounts in China that has led to the falsification by perpetrators

Let us see the next financial results if there are some corrections

Before announcing the figures, China may cross check them with HK and some other sources before it announces themthe

 

[cirr]

Guangdong province enters the era of HSRs：

Still got a long way to go though。

Guangdong needs to add to its existing network at least 2000km of intercity HSRs.

 

[cirr]

China’s Fifth-Richest Man Targets to Sell More SUVs Than Jeep

http://www.bloomberg.com/news/2013-0...than-jeep.html

By Bloomberg News - May 31, 2013

Chinese billionaire Wei Jianjun has set a target for Great Wall Motor Co. (2333)’s Haval marque to surpass Chrysler Group LLC’s Jeep and become the world’s best selling SUV-dedicated brand in three to four years.

As part of the plan, Great Wall’s chairman has started construction of a new research center the size of 35 soccer fields in the city of Baoding, about 160 kilometers (100 miles) from Beijing. He plans to increase the number of engineers by at least 40 percent to more than 10,000.

“We want Haval to have the highest value for money,” Wei, who is China’s fifth-richest man with an estimated net worth of $6.6 billion according to the Bloomberg Billionaires Index, told reporters yesterday at the company’s factory in northern Hebei province. “We want to surprise our customers by that instead of just satisfying them.”

Great Wall posted record profits last year, helped by a 90 percent surge in SUV sales as increasing numbers of Chinese consumers sought more space than conventional sedans can offer. To achieve his goal, Haval will have to surpass Jeep, which sold more than twice as many SUVs last year, according to data from the companies.

“Great Wall’s growth trajectory has been pretty impressive,” said Ashvin Chotai, London-based managing director of Intelligence Automotive Asia. “That said, it looks a bit optimistic to want to be the biggest SUV brand in the world, especially since it doesn’t have a presence in the U.S., which is one of the biggest SUV markets in the world.”

Great Wall currently sells its SUVs mainly in emerging markets and would need to step up their presence in Europe and the U.S. in order to achieve the goal, he said.

SUV Demand

In China, competition in the country’s fastest-growing vehicle segment will also increase as Jeep and Tata Motors Ltd. (TTMT)’s Jaguar Land Rover start production in the country, allowing them to avoid paying custom duties that add at least 25 percent to the sticker price.

SUV demand helped Great Wall boost net income last year by 66 percent and more than double its share price. The automaker’s Hong Kong-traded stock is up 53 percent this year, beating the 0.8 percent decline in the benchmark Hang Seng Index. (HSI)

The automaker boosted its SUV sales to 279,956 units, according to its annual report. That compares with the 316,000 SUVs that Land Rover sold in the financial year ended March, and Jeep’s sales of 701,626 vehicles.

Great Wall, which counts Russia as its largest overseas market and Iraq as its fastest-growing, has said it plans to spend 5 billion yuan ($816 million) in the five years ending 2015 to strengthen product development and technology research.

Great Wall wants to develop its own technology so that it can own the patents and have the “final say” on its product strategy, Wei said yesterday at the event showcasing the automaker’s technology.

“A lot of leading automakers in the world are based in small cities or in the countryside,” he said. “Baoding is a small city, but we believe that we become an excellent company.”

China's Great Wall Motor to more than double workforce by 2015

BEIJING, June 7 | Fri Jun 7, 2013

(Reuters) - Great Wall Motor , China largest SUV maker, plans to more than double its capacity and workforce by 2015 as its speeds up expansion in China and overseas, it said in a statement on Friday.

Capacity will reach 1.5 million by 2015, more than double the 2012 level, and it plans to add 63,800 new hires during the period, including 43,000 assembly line workers and 2,800 management staff. It currently has 56,000 employees.

Last year, Great Wall, best known for its Haval SUV, sold 624,600 cars, up 28.3 percent from a year earlier. Sales in the first four months came to 250,000, up 38 percent, according to company data. (Reporting by Fang Yan and Kazunori Takada)

http://www.reuters.com/article/2013/...0AM01V20130607

 

[cirr]

Changan's profits grow over 270% in Q1

Gasgoo.com (Shanghai May 1) - Changan Automobile earned a net profit of 549 million yuan ($88.41m) over the first quarter of the year, China Securities News reported earlier this week, citing the manufacturer's recently released financial performance review. The figure is equivalent year-on-year growth of 274.49 percent. The manufacturer's total business returns for the quarter totaled 10.18 billion yuan ($1.64b), representing year-on-year growth of 34.9 percent.

Changan attributes its dramatic growth in net profits to increasing sales of its own brand models, such as the Eado and CS35, as well as rising profits of its Changan Ford joint venture. Changan Ford's New Focus (pictured above) and Kuga SUV played a crucial part in boosting the JV's profits, with monthly sales of the latter increasing from 1,000 units in January to 5,000 units in March.

Changan's net profits are anticipated to continue over the following months, with the two new own brand models it released last month, the Eulove (pictured below) and the Raeton, expected to attract a lot of new buyers.

http://autonews.gasgoo.com/china-new...1-130502.shtml

Changan CS95 Concept

 

[Truth Finder]

The agency said the scale of credit was so extreme that the country would find it very hard to grow its way out of the excesses as in past episodes, implying tougher times ahead.
"The credit-driven growth model is clearly falling apart. This could feed into a massive over-capacity problem, and potentially into a Japanese-style deflation," said Charlene Chu, the agency's senior director in Beijing.
"There is no transparency in the shadow banking system, and systemic risk is rising. We have no idea who the borrowers are, who the lenders are, and what the quality of assets is, and this undermines signalling," she told The Daily Telegraph.
While the non-performing loan rate of the banks may look benign at just 1pc, this has become irrelevant as trusts, wealth-management funds, offshore vehicles and other forms of irregular lending make up over half of all new credit. "It means nothing if you can off-load any bad asset you want. A lot of the banking exposure to property is not booked as property," she said.
Concerns are rising after a string of upsets in Quingdao, Ordos, Jilin and elsewhere, in so-called trust products, a $1.4 trillion (£0.9 trillion) segment of the shadow banking system.
Bank Everbright defaulted on an interbank loan 10 days ago amid wild spikes in short-term "Shibor" borrowing rates, a sign that liquidity has suddenly dried up. "Typically stress starts in the periphery and moves to the core, and that is what we are already seeing with defaults in trust products," she said.
Fitch warned that wealth products worth $2 trillion of lending are in reality a "hidden second balance sheet" for banks, allowing them to circumvent loan curbs and dodge efforts by regulators to halt the excesses.
This niche is the epicentre of risk. Half the loans must be rolled over every three months, and another 25pc in less than six months. This has echoes of Northern Rock, Lehman Brothers and others that came to grief in the West on short-term liabilities when the wholesale capital markets froze.
Mrs Chu said the banks had been forced to park over $3 trillion in reserves at the central bank, giving them a "massive savings account that can be drawn down" in a crisis, but this may not be enough to avert trouble given the sheer scale of the lending boom.
Overall credit has jumped from $9 trillion to $23 trillion since the Lehman crisis. "They have replicated the entire US commercial banking system in five years," she said.
The ratio of credit to GDP has jumped by 75 percentage points to 200pc of GDP, compared to roughly 40 points in the US over five years leading up to the subprime bubble, or in Japan before the Nikkei bubble burst in 1990. "This is beyond anything we have ever seen before in a large economy. We don't know how this will play out. The next six months will be crucial," she said.
The agency downgraded China's long-term currency rating to AA- debt in April but still thinks the government can handle any banking crisis, however bad. "The Chinese state has a lot of firepower. It is very able and very willing to support the banking sector. The real question is what this means for growth, and therefore for social and political risk," said Mrs Chu.
"There is no way they can grow out of their asset problems as they did in the past. We think this will be very different from the banking crisis in the late 1990s. With credit at 200pc of GDP, the numerator is growing twice as fast as the denominator. You can't grow out of that."
The authorities have been trying to manage a soft-landing, deploying loan curbs and a high reserve ratio requirement (RRR) for banks to halt property speculation. The home price to income ratio has reached 16 to 18 in many cities, shutting workers out of the market. Shadow banking has plugged the gap for much of the last two years.
However, a new problem has emerged as the economic efficiency of credit collapses. The extra GDP growth generated by each extra yuan of loans has dropped from 0.85 to 0.15 over the last four years, a sign of exhaustion.
Wei Yao from Societe Generale says the debt service ratio of Chinese companies has reached 30pc of GDP – the typical threshold for financial crises -- and many will not be able to pay interest or repay principal. She warned that the country could be on the verge of a "Minsky Moment", when the debt pyramid collapses under its own weight. "The debt snowball is getting bigger and bigger, without contributing to real activity," she said.
The latest twist is sudden stress in the overnight lending markets. "We believe the series of policy tightening measures in the past three months have reached critical mass, such that deleveraging in the banking sector is happening. Liquidity tightening can be very damaging to a highly leveraged economy," said Zhiwei Zhang from Nomura.
"There is room to cut interest rates and the reserve ratio in the second half," wrote a front-page editorial today in China Securities Journal on Friday. The article is the first sign that the authorities are preparing to change tack, shifting to a looser stance after a drizzle of bad data over recent weeks.
The journal said total credit in China's financial system may be as high as 221pc of GDP, jumping almost eightfold over the last decade, and warned that companies will have to fork out $1 trillion in interest payments alone this year. "Chinese corporate debt burdens are much higher than those of other economies. Much of the liquidity is being used to repay debt and not to finance output," it said.
It also flagged worries over an exodus of hot money once the US Federal Reserve starts tightening. "China will face large-scale capital outflows if there is an exit from quantitative easing and the dollar strengthens," it wrote.
The journal said foreign withdrawals from Chinese equity funds were the highest since early 2008 in the week up to June 5, and withdrawals from Hong Kong funds were the most in a decade.
Fitch says China credit bubble unprecedented in modern world history - Telegraph

 

[shuttler]

The same agency that improves india's sovereignty rating to above junk level when the indian government is on all fours relaxing their rules for foreign ravage of their poor economy while gasping their thin breaths for saving the rupees from diving on free falls

As for our financial market it is a good time for some major adjustments, cleansing up non-performing loans and unproductive enterprises towards becoming a leaner and more efficient economy

If the scenario is as horrifying as what Fitch has said, why they did not take a deeper downgrade than A-plus!

 

[Beast]

Never mind, China got 3 trillion reserve to withstand any financial onslaught for next 10 years.

India got nothing..