China’s Economy Showed Steady Growth In the First Quarter of 2015

[Shotgunner51]

From the trade point of view, 1Q exports grow 4.9% YOY, that's reasonable. 1Q imports drops, largely due to dip in commodity prices, good trend. Trade surplus @ 755.3 billion yuan that's around $122 billion, compared to $382 billion of 2014, that's 28% growth , that's massive.

The trade surplus will put an appreciation pressure on RMB, directing China to a more balanced trade position despite the time-scale could be infinitely long. There are multiple ways of solving the problem e.g. re-investing the Forex as outbound FDI, selling the Forex reserve to domestic buyers and cut back money supply.

 

[Shotgunner51]

LOL ... there's a Chinese ancient words:"巧妇难无米之炊", as a engineer i knew how domestic manufacturer works in China ... Chinese is really good at doing System Engine of circuit board/ mechanism/ assembly, but we r not good at core-tech like CPU & Chipset ... each year China imported ten billions of USD chipset from foreign high-tech companies like Intel / AMD / Nvidia / Atmel / National Semiconductor / Texas Instruments / STMicroelectronics / Freescale Semiconductor / Qualcomm / Samsung / MTK / NXP(Philips) etc ... u might don't know them, but their CPU/Chipset using in ur smartphone/computer/touchpad/LCD etc ... 60~70% benefits earned by those fvcking foreign high-tech companies, Chinese manufacturer only earn rest 30~40% money due to our engineers & workers designed PCB/ shell / produce-line assembly ... we did it during 30 years but still now doing it, WHY ? Coz our government spent too much money in investments of China Real Estate, waste too much energy in fvcking GDP data game.

Without holding core-tech like the West, we r just their slavers and our generations will be too. CCP don't know it, right now their real estate price is the 1st important thing. When Chinese still doing those fvcking low value-added works, China export business only controlled by foreign companies who has the core-tech, and most true benefits earned by foreigners ... but CCP only care the fvcking real estate, it's like the FOOL Japan did in 1990s.


After 15-year PEACE development, ASEAN nations will catch us ... if Chinese still doing these low value-added works and won't hold core-tech field in true high-tech like microelectronic industry. CCP's "Industrial Upgrading" is just a big JOKE !!!

China has already established a massive industrial capability, and tops the world in industrial output. About manufacturing value added, the picture for world's top 5 countries is:

I agree with you brother, in terms of per capita value added, China is way behind the other 4 industrial powerhouses, that's why China has to seriously go higher up the value chain. With well educated & healthy work-force, fast-developing (and even world best in some categories) infrastructure, critical mass in supply chain, even abundance of entrepreneurial spirits! So what's stopping China from going up?

Yes, you have pointed out the symptom - an underdeveloped core tech industry. Why is that?

The root cause of the problem is - a seriously underdeveloped finance sector. Different from infrastructure and welfare systems, which are all primarily state-driven, and different from manufacturing which is predictable, hi-tech business isn't. China's existing finance sector is dominated by one philosophy - control, and stability. Hi-tech is uncontrollable, it isn't stable, it isn't predictable. It requires venturism, risk-taking, as well as marketing sense, and none of these are supposed to be the traits possessed by SOE's which now dominates China's financial sector.

China needs to liberalize the financial sector, from private equities to public equity markets, only through which capital can be deployed more efficiently, and serves the millions of Chinese hi-tech entrepreneurs.

 

[Bussard Ramjet]

I agree with @cnleio to some extent, as in that China is perhaps not giving due weightage to high value added industries and technology sector. China keeps splurging INSANE amount of money.

Just some time back there was the proposal of 220 billion dollars HSR from Moscow to Beijing, and I am damn sure that this money is going almost totally in dump.

If you had spent this money alone in establishing your Chinese intel, that would have become bigger than intel. After all what you need to simply do is poach all employees of intel, qualcomm and the like. Give them good money. And help you to develop the industry.

Similarly, China is giving way too money to bankrupt regimes. Like Venezuela. I have no hope that they will ever be able to repay. They are just too messed up. Again, I am not saying that only China does it, because IMF has done the same with Ukraine. But, this is China's money.

 

[cnleio]

China has already established a massive industrial capability, and tops the world in industrial output. About manufacturing value added, the picture for world's top 5 countries is:

I agree with you brother, in terms of per capita value added, China is way behind the other 4 industrial powerhouses, that's why China has to seriously go higher up the value chain. With well educated & healthy work-force, fast-developing (and even world best in some categories) infrastructure, critical mass in supply chain, even abundance of entrepreneurial spirits! So what's stopping China from going up?

Yes, you have pointed out the symptom - an underdeveloped core tech industry. Why is that?

The root cause of the problem is - a seriously underdeveloped finance sector. Different from infrastructure and welfare systems, which are all primarily state-driven, and different from manufacturing which is predictable, hi-tech business isn't. China's existing finance sector is dominated by one philosophy - control, and stability. Hi-tech is uncontrollable, it isn't stable, it isn't predictable. It requires venturism, risk-taking, as well as marketing sense, and none of these are supposed to be the traits possessed by SOE's which now dominates China's financial sector.

China needs to liberalize the financial sector, from private equities to public equity markets, only through which capital can be deployed more efficiently, and serves the millions of Chinese hi-tech entrepreneurs.

I will be happy if China government do what u said, but the truth as i saw is Li's government still focus on China Real Estate Bubble ... just for the sake of GDP data looks 'Good' and save world hot money in China.

Right now too many liars inside CPC senior members, no doubt next year we will see 6% economic growth on the newspapaer.(not 7% growth anymore)

I agree with @cnleio to some extent, as in that China is perhaps not giving due weightage to high value added industries and technology sector. China keeps splurging INSANE amount of money.

Just some time back there was the proposal of 220 billion dollars HSR from Moscow to Beijing, and I am damn sure that this money is going almost totally in dump.

If you had spent this money alone in establishing your Chinese intel, that would have become bigger than intel. After all what you need to simply do is poach all employees of intel, qualcomm and the like. Give them good money. And help you to develop the industry.

Similarly, China is giving way too money to bankrupt regimes. Like Venezuela. I have no hope that they will ever be able to repay. They are just too messed up. Again, I am not saying that only China does it, because IMF has done the same with Ukraine. But, this is China's money.

It's easy to understand, if China infrastructure construction tends to saturation ... Chinese can build infrastructures in foreign undeveloped nations & earn money from outside instead of inside China, it's just like export "Made in China" before now export Chinese Cement + Steel.

The big problem, is before CCP's " industrial upgrading" or own core-tech ... China government & China GDP becoming too dependent on infrastructure building & real estate, right now boost China unhealth GDP growth.

 

[Shotgunner51]

I will be happy if China government do what u said, but the truth as i saw is Li's government still focus on China Real Estate Bubble ... just for the sake of GDP data looks 'Good' and save world hot money in China.

Right now too many liars inside CPC senior members, no doubt next year we will see 6% economic growth on the newspapaer.(not 7% growth anymore)


It's easy to understand, if China infrastructure construction tends to saturation ... Chinese can build infrastructures in foreign undeveloped nations & earn money from outside instead of inside China, it's just like export "Made in China" before now export Chinese Cement + Steel.

The big problem, is before CCP's " industrial upgrading" or own core-tech ... China government & China GDP becoming too dependent on infrastructure building & real estate, right now boost China unhealth GDP growth.

Well said! China's per capita manufacturing value add is only like 1/3 of Japan, Korea or Germany, needs to upgrade urgently! While on the other hand as a traditional East Asian country, there are $4 trillions of Forex, RMB 30 trillions of securities, RMB 114 trillions of savings and god-knows how much of real estates sleeping in the most backward financial system in the world! As an i-banker I am really ashamed of China's financial system.

Unlike infrastructure, which is predictable (despite long pay back period), and the its nature of being public makes it rightfully state-administered, but hi-tech isn't anything like that. Unlike defense tech or some visionary natural science projects which are non-marketable (as least in the short run) domestically, civilian hi-tech needs market efficiency.

--> In order to do that, the government should focus on efficient use of tax payers' money in health, education, natural science exploration, fiscal/tax incentives for innovation, social welfare and all sorts of civil protection ("soft infrastructure"), the SOE's should focus firmly on building infrastructures (the "hard" ones), both should stay out of the competitive hi-tech market, as well as the capital market.​

--> And in order to achieve that, put it simply, CPC only needs to do one thing - Judicial Reform. That will include set boundaries for the government/SOE's and downsize them, complete all sorts of properties protection law (incl. IP), increase voice of hi-tech sector in law-making (especially fiscal-related), reform tax strategies.​

 

[Bussard Ramjet]

Well said! China's per capita manufacturing value add is only like 1/3 of Japan, Korea or Germany, needs to upgrade urgently! While on the other hand as a traditional East Asian country, there are $4 trillions of Forex, RMB 30 trillions of securities, RMB 114 trillions of savings and god-knows how much of real estates sleeping in the most backward financial system in the world! As an i-banker I am really ashamed of China's financial system.

Unlike infrastructure, which is predictable (despite long pay back period), and the its nature of being public makes it rightfully state-administered, but hi-tech isn't anything like that. Unlike defense tech or some visionary natural science projects which are non-marketable (as least in the short run) domestically, civilian hi-tech needs market efficiency.

--> In order to do that, the government should focus on efficient use of tax payers' money in health, education, natural science exploration, fiscal/tax incentives for innovation, social welfare and all sorts of civil protection ("soft infrastructure"), the SOE's should focus firmly on building infrastructures (the "hard" ones), both should stay out of the competitive hi-tech market, as well as the capital market.​

--> And in order to achieve that, put it simply, CPC only needs to do one thing - Judicial Reform. That will include set boundaries for the government/SOE's and downsize them, complete all sorts of properties protection law (incl. IP), increase voice of hi-tech sector in law-making (especially fiscal-related), reform tax strategies.​

Reserves have come down to 3.8 trillion the last time I checked.