China economy
ESCALATING inflation and restrictive policies could be nurturing circumstances similar to those which brought about the Tiananmen Square uprising, warns brokerage Salomon Brothers Hongkong.
The company's chief regional economist Andrew Freris, says in The PRC - Economic Prospects and Policy Issues, that economic growth would have to slow down for at least a year to curb inflation.
''If this happens, there will be a strong probability that China will experience a growth recession towards the end of this year and for most of 1994,'' it said.
The report said China has undertaken a risky role in assuming the mantle of reform and high growth.
However, there are ''most encouraging'' indications that China is capable of sticking to its policies for longer-term benefit even in the face of their re-flotation of the yuan, it said.
