https://www.scmp.com/rss/321581/feed Zhang Jun is dean of the School of Economics at Fudan University and director of the China Centre for Economic Studies, a Shanghai-based think tank. en https://assets.i-scmp.com/static/img/icons/scmp-meta-1200x630.png https://www.scmp.com There are signs that the Chinese economy has been improving, owing to the government’s September 2024 stimulus package. Year-on-year gross domestic product growth in the first quarter of this year reached 5.4 per cent – continuing the marked acceleration from last year. In fact, the change in policy direction has been evident since late 2022, when Chinese policymakers acknowledged that falling demand was becoming a major problem. The most important cause was the real estate market, where a... https://www.scmp.com/opinion/china-opinion/article/3307406/more-chinas-spending-power-needs-be-unleashed-heres-how?utm_source=rss_feed https://www.scmp.com/opinion/china-opinion/article/3307406/more-chinas-spending-power-needs-be-unleashed-heres-how?utm_source=rss_feed Tue, 22 Apr 2025 08:30:08 +0000 The business model that underpinned Chinese economic growth for over two decades has collapsed in recent years, especially since the outbreak of the Covid-19 pandemic. Now, the combination of rising uncertainty and falling confidence is casting a dark shadow over the Chinese economy. The immediate reasons for the decline of China’s prevailing business model are external. In particular, geopolitical developments – mainly deepening trade frictions, especially with the United States – have rattled... https://www.scmp.com/opinion/china-opinion/article/3290201/how-chinas-fast-transforming-economy-can-avoid-painful-l-shaped-growth?utm_source=rss_feed https://www.scmp.com/opinion/china-opinion/article/3290201/how-chinas-fast-transforming-economy-can-avoid-painful-l-shaped-growth?utm_source=rss_feed Wed, 11 Dec 2024 06:30:14 +0000 In the wake of China’s exit from its zero-Covid strategy, the government has recognised the need to address the economic risks arising not only from supply shocks but from weakening aggregate demand. Doing so will require a shift in macroeconomic policy, which previously focused on the supply side. At the same time, after examining the financial risk and environmental costs of the real estate sector, Chinese leaders have doubled down on their commitment to achieving the long-term goal of... https://www.scmp.com/opinion/china-opinion/article/3278951/chinas-economic-strategy-change-thousand-adjustments?utm_source=rss_feed https://www.scmp.com/opinion/china-opinion/article/3278951/chinas-economic-strategy-change-thousand-adjustments?utm_source=rss_feed Wed, 18 Sep 2024 07:30:09 +0000 Rarely do assessments of an economy’s performance and potential diverge as sharply as when it comes to China. Even as some economists laud China’s past achievements and future prospects, others fixate on presumed flaws in its development model and suggest that the middle-income trap awaits. But even more remarkable than the sharp divergence of opinions on China’s economy is the fact that both sides are able to marshal ample evidence to support their views. Few would dispute that China owes its... https://www.scmp.com/opinion/china-opinion/article/3261989/why-chinas-diversified-economy-garners-both-praise-and-criticism?utm_source=rss_feed https://www.scmp.com/opinion/china-opinion/article/3261989/why-chinas-diversified-economy-garners-both-praise-and-criticism?utm_source=rss_feed Thu, 09 May 2024 06:32:11 +0000 As China grapples with enormous challenges – including an imploding property sector, unfavourable demographics and slowing growth – doubts about the future of the world’s largest growth engine are intensifying. Add to that China’s geopolitical rise, together with deepening tensions with the United States, and the need to understand China’s political economy is becoming more urgent than ever. A recent book by MIT’s Yasheng Huang – The Rise and Fall of the EAST: How Exams, Autocracy, Stability,... https://www.scmp.com/comment/opinion/asia/article/3255060/how-chinas-unique-value-system-unpins-its-prosperity-and-innovation?utm_source=rss_feed https://www.scmp.com/comment/opinion/asia/article/3255060/how-chinas-unique-value-system-unpins-its-prosperity-and-innovation?utm_source=rss_feed Tue, 12 Mar 2024 09:30:17 +0000 The narrative that China’s economy is nearing its peak – or has already reached it – has taken hold in Western media. But if you read the doomsayers’ analyses carefully, you will find that many of the reasons they give for their bleak assessments are not new. On the contrary, they tend to highlight precisely the same challenges that economists and commentators have been harping on for at least a decade or longer. If China was not sputtering then, why should we believe it is now? To be sure, the... https://www.scmp.com/comment/opinion/article/3247222/chinas-economic-slowdown-could-work-its-favour?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3247222/chinas-economic-slowdown-could-work-its-favour?utm_source=rss_feed Thu, 04 Jan 2024 12:45:08 +0000 China’s aggregate demand has weakened significantly over the past three years. In addition to the enduring effects of China’s anti-Covid policy, the country has also been weighed down by the decrease in global demand. Exports fell by 14.5 per cent year on year in July. Given such downturn pressures, the government’s decision not to announce a massive stimulus package, as many had anticipated, has left foreign and Chinese observers deeply perplexed. While China’s leaders are certainly aware of... https://www.scmp.com/comment/opinion/article/3232658/why-china-reluctant-launch-massive-economic-bailout?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3232658/why-china-reluctant-launch-massive-economic-bailout?utm_source=rss_feed Tue, 29 Aug 2023 07:30:11 +0000 After Chinese GDP grew by only 3 per cent in 2022, one would have expected the government to set a growth target of at least 6 per cent for this year. In fact, virtually no market forecast projects a lower rate. Yet, at last month’s National People’s Congress, outgoing premier Li Keqiang revealed in his final government work report that Beijing was aiming for growth of about 5 per cent, the lowest target of his tenure. Under former premier Wen Jiabao, from 2003 to 2013, China maintained an... https://www.scmp.com/comment/opinion/article/3217238/china-has-abandoned-illusion-high-growth-can-be-maintained-indefinitely-thats-right-way-forward?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3217238/china-has-abandoned-illusion-high-growth-can-be-maintained-indefinitely-thats-right-way-forward?utm_source=rss_feed Sun, 16 Apr 2023 13:30:16 +0000 Chinese bank deposits increased by about 26.3 trillion yuan (US$3.9 trillion) last year, according to recent data from China’s central bank, the People’s Bank of China (PBOC). Spurred by China’s rigid Covid-19 containment strategy, which the government rolled back in December, household savings surged by 17.8 trillion yuan in 2022, growing by more than 5 trillion yuan in the last two months of the year alone. To many economists and analysts, these “excess savings” represent pent-up demand that... https://www.scmp.com/comment/opinion/article/3208971/chinas-huge-household-savings-no-guarantee-economic-recovery-revenge-spending?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3208971/chinas-huge-household-savings-no-guarantee-economic-recovery-revenge-spending?utm_source=rss_feed Fri, 03 Feb 2023 07:44:33 +0000 When Western economists and historians analyse China’s spectacular economic transformation over the past four decades, they tend to emphasise the productivity boom unleashed by the start of market-oriented reforms in 1978. But the role of the country’s political elite as a key driver of its emergence as an economic power has remained under-examined. This is partly because it is hard to measure the contribution of political elites to a country’s economic development. Fortunately, a new study by... https://www.scmp.com/comment/opinion/article/3202353/chinas-economic-rise-part-thanks-its-political-elites?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3202353/chinas-economic-rise-part-thanks-its-political-elites?utm_source=rss_feed Wed, 07 Dec 2022 05:20:31 +0000 In January, China’s government forecast that the country’s economy – which, at the time, was experiencing a strong rebound after the initial pandemic slowdown – would grow by 5.5 per cent in 2022. But by the second quarter, unfortunately, the rapid spread of the Omicron variant of Covid-19 had forced the government to implement emergency containment measures in its most economically dynamic cities, including Beijing, Guangzhou, Shanghai and Shenzhen. The two-month Shanghai lockdown, in... https://www.scmp.com/comment/opinion/article/3195004/covid-19-highlights-how-chinas-economy-will-suffer-if-cadres-dont?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3195004/covid-19-highlights-how-chinas-economy-will-suffer-if-cadres-dont?utm_source=rss_feed Thu, 06 Oct 2022 06:00:12 +0000 When high levels of investment spending fuelled a sustained increase in Chinese inflation from 1991 to 2011, the authorities quickly brought the situation under control and, over the past decade, the consumer price index (CPI) has rarely exceeded 2 per cent, compared to 5.4 per cent in 2011. But with policymakers in most major economies now losing their grip on price stability, can China continue to keep a lid on inflation this year and next? To answer this question, we must first look at how... https://www.scmp.com/comment/opinion/article/3187688/can-china-keep-lid-inflation-world-struggles-stem-price-rises?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3187688/can-china-keep-lid-inflation-world-struggles-stem-price-rises?utm_source=rss_feed Thu, 04 Aug 2022 17:30:14 +0000 A tough decision to lock down Shanghai, China’s largest city, shocked the world. After six weeks, and despite a sharp decline in infections, Shanghai’s lockdown has imposed enormous costs on the city and its residents. Given that the Omicron variant has a low mortality rate among the vaccinated, and much of the rest of the world has been convinced to shift their strategies from lockdowns and movement restrictions to mass immunisation, critics wonder why China’s zero-Covid policy is here to... https://www.scmp.com/comment/opinion/asia/article/3178254/why-china-will-not-abandon-its-zero-covid-policy-any-time-soon?utm_source=rss_feed https://www.scmp.com/comment/opinion/asia/article/3178254/why-china-will-not-abandon-its-zero-covid-policy-any-time-soon?utm_source=rss_feed Fri, 20 May 2022 01:15:21 +0000 In terms of geopolitical impact, nothing could be more important than the United States’ shift from strategic cooperation to strategic competition with China. This change has darkened many observers’ views of China’s economic prospects. The assumption is that China has no choice but to retreat from its successful development path and embark on a less-prosperous path toward self-reliance, with the state exercising complete control over the economy to hedge against geopolitical shocks. But China’s... https://www.scmp.com/comment/opinion/article/3170481/chinas-hedge-against-us-policies-and-geopolitical-shocks-will-not?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3170481/chinas-hedge-against-us-policies-and-geopolitical-shocks-will-not?utm_source=rss_feed Tue, 15 Mar 2022 05:30:17 +0000 In just four decades, China’s economy has achieved an unprecedented level of wealth and development, and, until recently, its upwards trajectory of economic growth and prosperity seemed set to continue. But as political pressures and the coronavirus push many countries – particularly the United States – to embrace more nationalist policies, the heyday of globalisation could soon be replaced by a post-pandemic era shaped by national security concerns and border controls. This is not good news for... https://www.scmp.com/comment/opinion/article/3160237/why-china-holds-advantage-over-america-even-amid-deglobalisation?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3160237/why-china-holds-advantage-over-america-even-amid-deglobalisation?utm_source=rss_feed Sun, 19 Dec 2021 06:30:25 +0000 Over the past 20 years, a number of thriving technology companies have emerged in China. This has invited much speculation about the country’s scientific and technological prowess, and about its ability to innovate. Some argue that China is already nipping at America’s heels in these domains, and has become a world leader in some sectors. Others believe that China is not quite as far along as it may appear, and the government’s regulatory clampdown on tech companies will impede its continued... https://www.scmp.com/comment/opinion/article/3151218/secret-chinas-economic-success-willingness-learn?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3151218/secret-chinas-economic-success-willingness-learn?utm_source=rss_feed Tue, 05 Oct 2021 17:30:24 +0000 The great powers in history have tended to have one thing in common – size matters. While a large market does not guarantee dominance in other realms, it certainly helps, perhaps more than any other single factor. This was true of the United States, and now it applies to China. Beyond being a leading economic and trading power, China is increasingly becoming a global financial power. Somehow, many economists in the West did not see this coming. Even a decade ago, few were bullish about the... https://www.scmp.com/comment/opinion/article/3143604/why-chinas-rise-financial-dominance-inevitable?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3143604/why-chinas-rise-financial-dominance-inevitable?utm_source=rss_feed Tue, 03 Aug 2021 14:00:16 +0000 Last month, the US Senate Foreign Relations Committee officially backed the Strategic Competition Act of 2021, which labels China a strategic competitor in a number of areas, including trade, technology and security. Given bipartisan support – exceedingly rare in the United States nowadays – Congress is likely to pass the bill, and President Joe Biden will sign it. With that, America’s antagonism towards China would effectively become enshrined in US law. The act purports to highlight China’s... https://www.scmp.com/comment/opinion/article/3134539/why-americas-growing-antagonism-towards-china-can-be-traced-us?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3134539/why-americas-growing-antagonism-towards-china-can-be-traced-us?utm_source=rss_feed Sun, 23 May 2021 13:30:09 +0000 Historically, demographics has been a slow-moving variable. But the East Asian economies – especially China, Japan and South Korea – have flipped so fast from rapid population growth to decline that they practically have whiplash. As a planned economy, China was once obsessed with expanding its population. But, in 1957, the economist Ma Yinchu published The New Theory of Population and cautioned that this trend would soon begin to undermine China’s economic development. Though the government... https://www.scmp.com/comment/opinion/article/3126752/could-chinas-population-crisis-be-reaching-point-no-return?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3126752/could-chinas-population-crisis-be-reaching-point-no-return?utm_source=rss_feed Wed, 24 Mar 2021 22:45:07 +0000 On October 14, President Xi Jinping visited the southern city of Shenzhen, where he delivered a speech celebrating 40 years of progress since the special economic zone (SEZ) was established there. A month later, Xi headed to Shanghai’s Pudong district – which was designated China’s first “new area” 30 years earlier – for the same purpose. The centrality of Shenzhen and Shanghai to China’s future development could not be clearer. When China first created the Shenzhen SEZ, some questioned its... https://www.scmp.com/comment/opinion/article/3111116/shenzhen-shanghai-show-chinas-skill-playing-pioneering-cities?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3111116/shenzhen-shanghai-show-chinas-skill-playing-pioneering-cities?utm_source=rss_feed Tue, 24 Nov 2020 09:00:15 +0000 Despite taking a serious hit from Covid-19 lockdowns, China’s economy has proved resilient. It has not, however, fully bounced back: some activities, especially in the service sector, simply cannot be revived. Yet, unlike most of the world, China seems unlikely to become mired in a long recession, not least because of its rapid digital transformation. China’s digital economy was growing strongly before the pandemic. In 2018, it already accounted for 31.3 trillion yuan (US$4.7 trillion), or 34.8... https://www.scmp.com/comment/opinion/article/3100679/how-chinas-rapid-shift-digital-economy-can-help-it-escape-long?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3100679/how-chinas-rapid-shift-digital-economy-can-help-it-escape-long?utm_source=rss_feed Wed, 09 Sep 2020 12:45:06 +0000 Widespread lockdowns and border closures to combat the Covid-19 pandemic have interrupted supply chains and largely paralysed the global economy. Yet its real weakness is not its vulnerable production networks but souring attitudes towards globalisation – and China in particular. Fear of China’s growing economic clout is increasingly driving many foreign-trade and investment decisions, and not only in the United States. Concerns about manufacturing dependence on China have prompted calls to... https://www.scmp.com/comment/opinion/article/3090574/why-chinas-economy-will-continue-grow-and-attract-investment?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3090574/why-chinas-economy-will-continue-grow-and-attract-investment?utm_source=rss_feed Fri, 26 Jun 2020 19:00:11 +0000 The global recession brought on by the Covid-19 pandemic is almost certain to be far deeper and more protracted than the one that followed the 2008 global financial crisis. While many governments have pledged to bolster their economies with unprecedented monetary and fiscal stimulus – despite holding already-massive public debt – the best they can probably hope for is to stave off economic collapse. If they insist on turning inward – pointing fingers and erecting barriers, instead of upholding... https://www.scmp.com/comment/opinion/article/3078940/why-coronavirus-crisis-wont-weaken-chinas-position-global-supply?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3078940/why-coronavirus-crisis-wont-weaken-chinas-position-global-supply?utm_source=rss_feed Wed, 08 Apr 2020 19:00:12 +0000 Just five days before the Lunar New Year, the authorities in Beijing finally declared the novel coronavirus pneumonia that originated in Wuhan a major public health emergency. Because Wuhan’s municipal government had initially withheld information and failed to effectively control the viral spread, about 5 million residents and temporary workers left the city for the Spring Festival holidays before the city was officially closed off on January 23. As a result, the virus has spread rapidly... https://www.scmp.com/comment/opinion/article/3050025/coronavirus-why-chinas-economy-likely-make-robust-recovery?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3050025/coronavirus-why-chinas-economy-likely-make-robust-recovery?utm_source=rss_feed Wed, 12 Feb 2020 17:00:10 +0000 China’s economic growth is expected to have slowed to just over 6%, and it is unlikely to accelerate any time soon.  In fact, analysts generally agree that China’s economic performance last year – its worst in nearly 30 years – could be its best for at least the next decade. What observers cannot seem to agree on is how worried China should be, or what policymakers can do to improve growth prospects. Optimists point out that, given the size of China’s economy today, even a 6% growth in gross... https://www.scmp.com/opinion/chinas-government-should-get-out-way-navigate-economic-slowdown/article/3044266?utm_source=rss_feed https://www.scmp.com/opinion/chinas-government-should-get-out-way-navigate-economic-slowdown/article/3044266?utm_source=rss_feed Thu, 02 Jan 2020 11:32:08 +0000 China’s economic growth is expected to have slowed to just over 6 per cent, and it is unlikely to accelerate any time soon. In fact, analysts generally agree that China’s economic performance last year – its worst in nearly 30 years – could be its best for at least the next decade. What observers cannot seem to agree on is how worried China should be, or what policymakers can do to improve growth prospects. Optimists point out that, given the size of China’s economy today, even a 6 per cent... https://www.scmp.com/comment/opinion/article/3044129/how-beijings-overmanagement-doing-chinas-economy-and-businesses?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3044129/how-beijings-overmanagement-doing-chinas-economy-and-businesses?utm_source=rss_feed Wed, 01 Jan 2020 17:00:13 +0000 Two years ago, Chinese President Xi Jinping declared that by the time the People’s Republic celebrates its centenary in 2049, it should be a “great modern socialist country” with an advanced economy. To achieve this ambitious goal, China will need to secure another three decades of strong economic performance and inclusive development. The question is how.  The first step towards answering this question is to understand what has driven China’s past successes. The People’s Republic did not thrive... https://www.scmp.com/comment/opinion/article/3032989/china-must-tap-potential-its-huge-domestic-market-economic-growth?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3032989/china-must-tap-potential-its-huge-domestic-market-economic-growth?utm_source=rss_feed Wed, 16 Oct 2019 07:00:12 +0000 China’s rapid economic rise in recent decades has astonished the world. Yet the reasons behind the country’s success are often misunderstood and misinterpreted. The rise of China is widely attributed to its state capitalism, whereby the government, endowed with huge assets, can pursue a wide-ranging industrial policy and intervene to mitigate risks. Accordingly, China owes its success, first and foremost, to the government’s “control” over the entire economy. This explanation is fundamentally... https://www.scmp.com/comment/opinion/article/3021858/china-owes-its-rapid-economic-rise-not-state-control-its-unique?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3021858/china-owes-its-rapid-economic-rise-not-state-control-its-unique?utm_source=rss_feed Fri, 09 Aug 2019 19:00:05 +0000 Just when a US-China trade agreement appeared to be in sight, negotiators found themselves back at square one. The immediate reason for the disruption was China’s insistence on a substantially rewritten draft agreement that, according to US President Donald Trump’s administration, reneges on previously agreed terms. But the cause of China’s changes to the draft – the reason behind its reluctance to meet US demands – lies in a fundamental miscalculation by the Trump administration.  Simply put,... https://www.scmp.com/comment/opinion/article/3012983/how-trump-misjudged-chinas-commitment-economic-stability-and?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3012983/how-trump-misjudged-chinas-commitment-economic-stability-and?utm_source=rss_feed Tue, 04 Jun 2019 17:00:10 +0000 For the West, the year 2008 marked the beginning of a difficult period of crisis, recession and uneven recovery. For China, 2008 was also an important turning point, but one followed by a decade of rapid progress that few could have foreseen.  Of course, when the US investment bank Lehman Brothers collapsed, triggering a global financial crisis, China’s leaders were deeply worried. Their concerns were compounded by natural disasters – including severe freezing rain and snowstorms in the south in... https://www.scmp.com/comment/insight-opinion/article/3004415/chinas-decade-extraordinary-growth-2008-lost-its-critics?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/3004415/chinas-decade-extraordinary-growth-2008-lost-its-critics?utm_source=rss_feed Wed, 03 Apr 2019 05:00:13 +0000 In his influential 1954 article “Economic Development with Unlimited Supplies of Labour”, the future Nobel laureate economist Arthur Lewis concluded that “the central problem in the theory of economic development is to understand the process by which a community which was previously saving and investing 4 or 5 per cent of its national income or less, converts itself into an economy where voluntary saving is running at about 12 or 15 per cent of its national income or more”. That process, Lewis... https://www.scmp.com/comment/insight-opinion/world/article/2184085/china-should-save-less-stop-protecting-industries-and?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/world/article/2184085/china-should-save-less-stop-protecting-industries-and?utm_source=rss_feed Wed, 30 Jan 2019 02:30:00 +0000 In the 1940s, the British historian Arnold J. Toynbee predicted that the United States and the Soviet Union would remain the world’s only two great powers. Not even China and India – with their “ancient civilisations” and “vast populations, territories and resources” – would be able to “exert their latent strength” in the ensuing decades.  Toynbee was right about the ensuing decades, but wrong about two places: the Soviet Union collapsed, and now China has become the world’s second-largest... https://www.scmp.com/comment/insight-opinion/asia/article/2176096/chinas-economy-will-not-go-way-japans-or-soviet-unions?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/asia/article/2176096/chinas-economy-will-not-go-way-japans-or-soviet-unions?utm_source=rss_feed Mon, 03 Dec 2018 17:00:56 +0000 Five years ago, China’s leaders decided to target modern state governance as a top reform priority. The goal of such reform is to improve the state’s capacity to adapt to the sheer size and increasing complexity of the Chinese economy, and to mitigate risk. Achieving this objective will not be easy.  To understand why, and what it will take to succeed, consider how Chinese governance has worked in recent decades. Overall, governing the country involves a combination of political centralisation... https://www.scmp.com/comment/insight-opinion/united-states/article/2166576/how-chinas-balancing-act-between-centralised?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/united-states/article/2166576/how-chinas-balancing-act-between-centralised?utm_source=rss_feed Tue, 02 Oct 2018 07:00:15 +0000 Over the past two decades, China has been achieving rapid technological progress, thanks in no small part to its massive investment in research and development, which totalled some 2.2 per cent of its gross domestic product last year. Yet China is nowhere near the technological frontier. In fact, the distance separating it from that frontier is far greater than most people recognise. In the West, many economists and observers now portray China as a fierce competitor for global technological... https://www.scmp.com/comment/insight-opinion/united-states/article/2157728/will-china-be-next-tech-powerhouse-maybe-next?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/united-states/article/2157728/will-china-be-next-tech-powerhouse-maybe-next?utm_source=rss_feed Wed, 01 Aug 2018 09:00:30 +0000 Last month, China commemorated the 20th anniversary of the death of Deng Xiaoping ( 鄧小平 ), the chief architect of the economic reform and opening up that catapulted the country to the top rungs of the global economic ladder. The anniversary comes at a time when economic openness is under threat, as the United States is being led by a president who believes that the way to “make America great again” is to close it off from the world. In particular, Donald Trump’s administration is posturing for a... https://www.scmp.com/comment/insight-opinion/article/2079805/chinas-cautious-financial-opening-does-not-make-it-enemy-us?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2079805/chinas-cautious-financial-opening-does-not-make-it-enemy-us?utm_source=rss_feed Fri, 17 Mar 2017 06:27:23 +0000 Chinese automotive glass tycoon Cao Dewang sparked heated debate countrywide recently, when he told an interviewer how his US$600 million investment to set up a US manufacturing branch for his company, Fuyao Glass Industry Group, was driven largely by China’s high taxes, which he claims are 35 per cent more than for manufacturers in the US. Has the tax burden on Chinese enterprises really reached economically lethal levels? Going strictly by the numbers, this doesn’t seem the case. Measured as... https://www.scmp.com/comment/insight-opinion/article/2059195/are-chinese-enterprises-being-taxed-death?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2059195/are-chinese-enterprises-being-taxed-death?utm_source=rss_feed Wed, 04 Jan 2017 08:30:15 +0000 For more than a year, headlines worldwide have been pointing to a Chinese economic slowdown. But a closer look at regional dynamics within China tells a different story – one that is less about deceleration than changing gears. According to the National Bureau of Statistics, resource-rich Shanxi (山西) province has suffered an economic slowdown, but Chongqing (重慶) and Guizhou (貴州) in the southwest have experienced vibrant growth. Hebei and three other northeastern provinces are feeling the effects... https://www.scmp.com/comment/insight-opinion/article/2007399/cities-must-rise-if-services-are-power-chinas-new-economy?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2007399/cities-must-rise-if-services-are-power-chinas-new-economy?utm_source=rss_feed Mon, 22 Aug 2016 09:31:18 +0000 Since 2002, China’s economy has undergone significant changes, including a shift from acceleration to deceleration of growth in gross domestic product. Yet the official urban unemployment rate, jointly issued by the National Bureau of Statistics and the Ministry of Labour and Social Security, has remained remarkably steady, at around 4-4.1 per cent. Since 2010, it has stood at precisely 4.1 per cent. This is surprising, to say the least – and has led some to ask whether the bureau could be... https://www.scmp.com/comment/insight-opinion/article/1936129/china-could-be-facing-hard-choice-over-painful-job-losses?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1936129/china-could-be-facing-hard-choice-over-painful-job-losses?utm_source=rss_feed Fri, 15 Apr 2016 06:00:30 +0000 At a forum in Canberra last year, financial commentator Andrew Sheng quipped, “China is transparent, but only in the Chinese sense.” The statement provoked laughter among those who view China’s decision-making processes as opaque; but it was laughter born of the recognition that Sheng was right. In the run-up to a major policy decision in China, editorials by high-ranking authorities in major publications, as well as reports and communiqués from official forums and meetings, almost always... https://www.scmp.com/comment/insight-opinion/article/1911962/china-communication-key-keeping-currency-markets-calm?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1911962/china-communication-key-keeping-currency-markets-calm?utm_source=rss_feed Thu, 11 Feb 2016 09:34:39 +0000 The tumult in China's equity market appears to have ended. But considerable uncertainty remains, not only about what caused the plunge in the Shanghai and Shenzhen stock exchanges, but also about what the episode will mean for China's financial-reform efforts. The stock-market crash has been attributed to many factors. Official media initially attributed the disaster largely to the "malicious" short-selling of Chinese shares by foreign banks and traders. Later, domestic investors also became... https://www.scmp.com/comment/insight-opinion/article/1847320/blame-inept-regulation-chinas-stock-market-crash?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1847320/blame-inept-regulation-chinas-stock-market-crash?utm_source=rss_feed Fri, 07 Aug 2015 03:15:15 +0000 The days of double-digit economic growth in China are over. Indeed, the annual growth rate, which has been lingering at about 7.5 per cent since 2012, is predicted to fall to 7 per cent this year. This is China's "new normal", characterised, according to China's leaders, by "medium-to-high-speed" growth. But perhaps even this is optimistic. In the past two years, credit grew almost twice as fast as gross domestic product, and total social financing grew even faster. Yet GDP growth slowed... https://www.scmp.com/comment/insight-opinion/article/1752375/inefficient-credit-holds-back-growth-has-no-place-chinas-new?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1752375/inefficient-credit-holds-back-growth-has-no-place-chinas-new?utm_source=rss_feed Tue, 31 Mar 2015 08:45:30 +0000 Although China's economy has expanded at a staggering pace over the past three decades, its growth model is now widely agreed to be exhausted. Even China's top leadership acknowledges the need for change. While not everyone agrees on exactly what the new model should look like, proposals do not differ drastically, given the consensus that the current model rests on an unsustainable foundation. On the demand side, many economists endorse a shift from investment-led to consumption-driven growth.... https://www.scmp.com/comment/insight-opinion/article/1410241/rethinking-role-efficiency-chinas-growth-model?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1410241/rethinking-role-efficiency-chinas-growth-model?utm_source=rss_feed Tue, 21 Jan 2014 20:00:30 +0000 China's economic slowdown has fuelled widespread speculation about the economy's growth potential. While it is impossible to predict China's growth trajectory, understanding the economy's underlying trends is the best way to derive a meaningful estimate. Some economists compare China to Japan in the early 1970s. After more than two decades of sustained rapid growth, Japan's economy slackened in 1971, leading to four decades of annual growth rates averaging less than 4 per cent. Structural reform... https://www.scmp.com/comment/insight-opinion/article/1353519/can-china-fulfil-its-untapped-economic-growth-potential?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/1353519/can-china-fulfil-its-untapped-economic-growth-potential?utm_source=rss_feed Mon, 11 Nov 2013 10:45:45 +0000