China Economy Forum

[Chinese-Dragon]

Great, improving momentum is exactly what we need for the massive upcoming economic reforms.

And those reforms, if implemented properly could lead to another boom era for China, as we relentlessly move towards becoming the first developed country in the world with 1+ billion people. Now that is one record that is truly worth achieving.

 

[cirr]

Average annual real growth of 7-8%（10-12% nominal）for the next 2 decades。

 

[cirr]

China's current economic growth normal: expert

(Xinhua) Updated: 2014-06-24 10:37


BEIJING - Renowned Chinese economist Li Yining on Monday refuted the notion that China's economy is in decline while noting that the previous high growth rates were "not normal."

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Chinese premier rules out economic hard landing

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China needs sustainable growth: IMF Secretary


"The previous 9 to 10 percent growth rates were to cope with the global economic crisis, and they were actually not normal. It won't do us much good if we keep that up," said Li, a national political advisor, at a meeting of the Standing Committee of the Chinese People's Political Consultative Conference National Committee, China's top political advisory body.

Li said that China's current GDP growth should be higher than the released figure, citing that housing construction in rural areas is not included in the country's GDP calculation while it usually is in developed countries.

According to Li, other fast-developing fields such as the incomes of maids and nannies as well as rural roads and bridges built in charity programs were not encompassed by China's GDP either.

He also refuted doubts concerning the authenticity of China's GDP figures.

"Some State-owned companies might make false reports to showcase their performances. However, the discrepancy can only be small, otherwise, it will be easily detected during auditing," according to the political advisor.

Meanwhile, private businesses, which contribute more than half of China's GDP, will do anything to report less due to taxation concerns, Li added.

He warned that a roller coaster-style trajectory will not be good for China's economic growth in the long run.


China's current economic growth normal: expert - Business - Chinadaily.com.cn

 

[rcrmj]

Must you resort to name calling and persona attacks ? It certainly doesn't give credibility to your point(s), if you even had any to begin with...

thats becuase you are a japanese, and your sheer stereotype about China is so classic which you keep denying, and it makes you ignorant and assertive

 

[cirr]

Nonreporting or under-reporting of sales revenue，let alone tax liabilities，is so bloody easy in China。

It is a practice widely adopted by all privately owned businesses，from one-man shops to enterprises with tens of thousands of employees。

The costs of owner-occupied as well as rental housings are two other accounts of which the figures are grossly under-estimated in China's GDP calculation。

 

[Raphael]

China's current growth rate is 7.x%. While this may be magnitudes higher than what developed economies are undergoing, it's definitely still the normal rate. What's actually anomalous is China's GDP/capita, which at 6700 is abnormally low. China's economy will continue growing at 7.5%+ until it converges in productivity levels with advanced economies.

BTW, 7.5%+ is not just the some random number pulled out of someone's ***, it represents the the minimum growth needed, consistently, to pull a country out of developing status. Malaysia grew at 6.5% for 50 years (Economy of Malaysia - Wikipedia, the free encyclopedia) but today, they are still a developing country, albeit around the upper limits.

If we do the math:
1.065^50=23.3
1.075^50=37.2

Just by increasing the growth rate by 1% (from 6.5% to 7.5%), we can see that GDP actually becomes 1.6x greater than what it would be after 50 years. If Malaysia grew at 7.5%, they would be developed by now. During the peak growth stages for the 4 Asian dragons (HK, SG, TW, SK), they are managed constant double digit growth, never dipping below 8%. So there's nothing wrong with China's current growth.

 

[Aepsilons]

thats becuase you are a japanese, and your sheer stereotype about China is so classic which you keep denying, and it makes you ignorant and assertive

Nonsense, your very post is hypocritical, considering you're personally attacking me simply because of my national origin. Please read. I know that true Chinese that I've come to admire are not as closed minded as you.

 

[Aegis DDG]

When China reaches an GDP of 17,000 dollars, it game over for competitors.

 

[rcrmj]

Nonsense, your very post is hypocritical, considering you're personally attacking me simply because of my national origin. Please read. I know that true Chinese that I've come to admire are not as closed minded as you.

no, thats just your opinion that you know China, but the reality is nowhere close to your ill-informed perception, just as simple as that```

 

[LeveragedBuyout]

This is a very long and complicated article, so it will not appeal to everyone. The crux of the argument is that China's growth has become too dependent on leverage, and with an increasing component of that leverage coming from outside sources, China is losing its ability to manage the money supply. A 1997-style crisis is unlikely, given China's immense foreign exchange reserves, but uncertainty is increasing.

As we've discussed before, the sooner China begins its financial reforms and moves away from investment-led growth, the better for both China and the world. We, collectively, cannot afford another financial crisis.

The Chinese government has much less control over its currency than most people think it does – Quartz

 

[terranMarine]

As we've discussed before, the sooner China begins its financial reforms and moves away from investment-led growth, the better for both China and the world. We, collectively, cannot afford another financial crisis.

financial crisis occurs from time to time yet we are still here, i don't doubt we will see more of it in the future.

 

[LeveragedBuyout]

financial crisis occurs from time to time yet we are still here, i don't doubt we will see more of it in the future.

True, but in most crises, some other part of the world continues to grow, and is thus able to compensate. The last world-wide simultaneous crisis was the Great Depression, which we would prefer to avoid. It is certain that the US and Europe will not return to strong growth in the near future, so it's up to China to hold the line.

 

[terranMarine]

True, but in most crises, some other part of the world continues to grow, and is thus able to compensate. The last world-wide simultaneous crisis was the Great Depression, which we would prefer to avoid. It is certain that the US and Europe will not return to strong growth in the near future, so it's up to China to hold the line.

As the engine of economic growth rests on China's shoulders i can agree on that. If China were to fall in combination with a sick EU and a declining US, i cannot imagine the magnitude of another Great Depression.

 

[Jlaw]

China industrial profits up 9.8 pct in first 5 months

Source:Xinhua Published: 2014-6-27 9:59:15

China's industrial profits continued to rise in the first five months but growth was slightly down from the Jan.-April period, still encouraging sign.

Industrial businesses saw their profits rise by 9.8 percent from a year ago in the first five months of 2014, the National Bureau of Statistics (NBS) said on Friday.

Total profits of industrial companies with annual business revenue of more than 20 million yuan (3.2 million US dollars) reached 2.28 trillion yuan from January to May.

Profit growth was 0.2 percentage points down from 10-percent year-on-year increase recorded in the first four months and 10.1 percent in the first quarter, data showed.

Growth was generally satisfactory compared with that of January and February when disappointing economic indicators, including exports and PMI, stirred concerns over the economic outlook. STABILIZING ECONOMY

Economic growth slipped to the lowest quarterly expansion since the third quarter of 2012 in the Jan.-March period , but key indicators have shown the economy is gradually gaining strength.

Growth in the manufacturing sector continued to accelerate in May, hitting a five-month high; China's exports also picked up in May by a seven-percent year-on-year increase, reversing weak performances in previous months.

Zhang Liqun, a researcher at the Development Research Center of the State Council, pointed to the improving data was an indication that "the economy continued to stabilize, and this trend is becoming evident".

Recent targeted policy easing is also expected to take effect and help the economic advance to remain stable.

Official GDP growth in the second quarter will be released by the NBS on July 17, along with other indicators including industrial output, investment and retail sales.

China industrial profits up 9.8 pct in first 5 months - Global Times

 

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