China's inflation rate has risen 5.1 per cent in November compared with a year ago, which is the country's fastest pace in the last 28 months. The hike in consumer prices is yet another indication of the world's second largest economy's unrelenting growth. Florence Looi reports on how Huaxi, China's wealthiest village, is a prime example of China's rising success.
Chinese are not happy with life: CASS studyAFP, Dec 16, 2010, 01.35pmBEIJING: People in China are increasingly dissatisfied with their lives as confidence in Beijing's ability to govern the vast country and manage the economy falters, according to a key government think tank. Indicators showed that public satisfaction with jobs and social security was at its lowest in four years, said the annual report based on a poll of the public and launched this week by the Chinese Academy of Social Sciences (CASS)."Urban and rural residents' overall life satisfaction declined as the negative impacts of the financial crisis gradually came into play in 2010," said the annual Blue Book of China's Society.Confidence in the government's ability to manage economic, social and international affairs fell, while pride in China's world status, which has been on the rise for four years, dropped back to its 2006 level, it said.In a further sign of growing fears about the country's soaring inflation, the report found prices topped the list of concerns in 2010 and people's ability to absorb price rises slumped sharply.China's consumer price index, a key gauge of inflation, rose 5.1% year on year in November, the fastest increase in over two years and well above Beijing's full-year target of three percent, as food costs continued to soar.Ever fearful of inflation's historical potential to spark unrest, authorities have taken a range of measures to curb growth, with the central bank in October hiking interest rates for the first time in nearly three years.The CASS report showed the Chinese public is also concerned about reform of the country's healthcare system and runaway housing costs. Reining in home prices has become the people's top expectation of the government, it said.Property prices in China's major cities were up 7.7% in November from a year ago and 0.3% from October, the third straight month-on-month rise, official data shows, despite Beijing's efforts to cool the red-hot market.More than 4,100 people were polled in seven major cities and seven smaller towns for the CASS report.
[youtube]0h7V3Twb-Qk[/youtube]http://www.youtube.com/watch?v=0h7V3Twb-Qkhttp://singaporeuncletrader.wordpress.com/2009/11/13/chinas-empty-city-build-them-and-they-will-contribute-to-8-gdp-target/QuoteNovember 13, 2009 · Leave a CommentI’ve always found the goal-seek function in excel to be a real time saver. It turns out that the Chinese government has something similar: build enough cities – never mind if they remain unoccupied – and voila! the magical ‘8′ appears.Summary: Ordos is a hyper modern city in China, full of brand new glass walled residential and commercial buildings, yet devoid of inhabitants. (from Al Jazeera)[tags] uncletrader
November 13, 2009 · Leave a CommentI’ve always found the goal-seek function in excel to be a real time saver. It turns out that the Chinese government has something similar: build enough cities – never mind if they remain unoccupied – and voila! the magical ‘8′ appears.Summary: Ordos is a hyper modern city in China, full of brand new glass walled residential and commercial buildings, yet devoid of inhabitants. (from Al Jazeera)
These amazing satellite images show sprawling cities built in remote parts of China that have been left completely abandoned, sometimes years after their construction.Elaborate public buildings and open spaces are completely unused, with the exception of a few government vehicles near communist authority offices.Some estimates put the number of empty homes at as many as 64 million, with up to 20 new cities being built every year in the country's vast swathes of free land.The photographs have emerged as a Chinese government think tank warns that the country's real estate bubble is getting worse, with property prices in major cities overvalued by as much as 70 per cent.
China grapples with money supply as inflation soarsFriday, January 21, 2011The Chinese authorities face an uphill task to reduce excess liquidity and ease inflationary pressures for the second time in three years. During the tightening campaign of 2007 and 2008, the People’s Bank of China lifted the banking sector’s reserve requirement ratio by eight percentage points to 17½ per cent and implemented a 135-basis point increase in benchmark lending rates.Food price inflation already exceeds 10 per cent with little sign of retreat but unlike 2007 – when disruptions in the food supply chain, primarily blue-ear disease and the resulting surge in pork prices, were the primary culprit behind the acceleration in the inflation rate – the uptick this time round is also apparent in non-food prices.Hot Money: Speculative capital inflows are already thwarting the People’s Bank of China’s efforts to control the money supply and quantitative easing in the US has added fuel to the fire.Dr. Jian Tianlun, a former employee of PBOC and currently an economist in the U.S., believes that the Chinese authorities were compelled to raise the interest rate.“The sudden interest hike now shows that either their decision then was based on political concerns, or that their understanding about the economic situation has now changed. Now that they feel a greater pressure of inflation, they are then forced to raise the interest rate.”The higher the interest rate, the higher the revaluation pressure on the Yuan. Jian speculated that perhaps the communist regime found that inflation was getting out of control, and was therefore forced to raise interest rates.Rates UpJian believes inflation will go even higher in 2011. “This is for sure. The NDRC has already set a higher target for inflation. This indicates that the regime has anticipated higher inflation for 2011 and it’s quite possible that inflation will be uncontrollable.”.
No lah, China FDI at record levels, Koreans, Germans investing big time - huge consumer market within China. Read here. Last year FDI in China rose 17.4% to $105.7B. FDI to India for 2010 DROPPED 31% percent to $23B. Wonder if investors are moving their FDI from India to China? :Foreign Direct Investment in China in 2010 Rises to Record $105.7 BillionBy Bloomberg News - Jan 17, 2011 6:20 PM PT Foreign direct investment in China rose to a record $105.7 billion last year, underscoring confidence that rising incomes will boost demand in the world’s fastest-growing major economy. Investment climbed 17.4 percent from a year earlier, the Ministry of Commerce said in a statement in Beijing today. Spending in December rose 15.6 percent from a year earlier to $14 billion. Estimates of five economists surveyed by Bloomberg News for the month ranged from an increase of 29 percent to a decline of 21 percent. Boosting wages and reducing income inequality will be major tasks over the next five years, China’s leaders said in October after setting targets for the economy for the 12th five-year plan. Samsung Electronics Co. and LG Display Co., the world’s two biggest makers of liquid-crystal displays, received Chinese government approval to build LCD factories in the country and meet surging demand. “Foreign companies tapping Chinese consumers will benefit from rising wages and will continue to invest in China,” said Alan Liao, an economist at Chinatrust Commercial Bank in Taipei. “There’s a misconception that higher salaries will force companies out of China, this may apply to low-margin textiles or toy manufacturers, but it’s not true for value-added service sectors and high-margin technology companies,” he said. Overtaking U.S. China in 2009 overtook the U.S. to become the world’s biggest car market, passed Germany as the largest exporter and likely surpassed Japan to become the second-biggest economy in 2010. It may overtake the U.S. as the largest economy by 2027, according to Goldman Sachs Group Inc. chief economist Jim O’Neill. The economy probably expanded about 10 percent, Vice Premier Li Keqiang said last week. Growth may slow to 8.7 percent this year as the government tries to limit increases in asset prices, the World Bank said in a Jan. 12 report. Foreign investment inflows are adding to liquidity flooding the economy from the trade surplus and surging bank lending and putting pressure on the central bank’s policy of restraining yuan appreciation. The People’s Bank of China has raised interest rates and told banks to keep more money as reserves to mop up cash. The government is also encouraging outbound investment, allowing companies to keep foreign-currency earnings overseas and boosting use of the yuan for trade and investment. Mergers Jump Outbound investment by non-financial companies climbed 36.3 percent to $59 billion, the commerce ministry said today. Overseas mergers and acquisitions by Chinese companies rose more than 30 percent last year to a record 188 with a combined deal value of $38 billion, PricewaterhouseCoopers LLP said at a press briefing yesterday. Middle-income and affluent consumers with annual household incomes of more than 60,000 yuan ($9,000) will probably almost triple in the next 10 years to 415 million, Boston Consulting Group Inc. said in a report released on Nov. 8. There will be “strong” increases in salaries in the five years to 2015 as the nation’s supply of labor dwindles and consumers spend more and save less, Credit Suisse Group AG sad in a report dated Jan. 1. Wages may rise by 19 percent a year and private consumption may climb to 41.7 percent of GDP in 2015 from 35.6 percent last year, the bank estimated. Companies in the online shopping and financial industries will benefit most from the increase in wages and consumer spending during the period, analysts led by Vincent Chan and Peggy Chan wrote in the report. Billion-Dollar Factories Wal-Mart Stores Inc. and a group partners last month agreed to invest more than $500 million in Chinese online retailer 360buy Jingdong Mall. China became the largest LCD-TV market in the third quarter, surpassing the U.S., according to Soh Hyun Cheol, an analyst at Shinhan Investment Corp. in Seoul. Samsung and LG are planning to build multi billion-dollar factories in Suzhou and Guangzhou to meet Chinese demand for flat panel displays used in televisions and computers. Taiwan’s AU Optronics Corp. last month said its board approved an additional $167 million investment in its plant in Kunshan, eastern Jiangsu province, that makes color filters used in LCD TVs and flat-screen monitors. The company is awaiting approval to build a $3 billion LCD plant in Suzhou. Top Target The United Nations’ trade and development agency predicted global foreign direct investment flows would climb to $1.5 trillion this year and $2 trillion in 2012 from an estimated $1.2 trillion in 2010, with China remaining the top target. India and Brazil will trail as the No. 2 and No. 3 recipients, according to the report. China was the second-largest recipient of FDI in 2009, attracting $95 billion, behind the U.S. with $130 billion, the United Nations said in a report in July. China estimated its FDI in 2009 at $90 billion.
On May 25, U.S. businessman Charles Hubbs made the short trek to Hong Kong from his office just outside Guangzhou, a city in Guangdong province in southeastern China that is known for good reason as the manufacturing workshop of the world. For the 64-year-old native of Louisiana, it was a trip that may have marked the beginning of the end of his successful 22-year run as a China-based exporter of medical supplies.Hubbs was going to listen to a pitch from the American ambassador in Cambodia, Carol Rodley, and the president of the American Chamber of Commerce in Phnom Penh. Their aim was simple: to get foreign investors, particularly those already with operations in China, to consider setting up shop in Cambodia. Hubbs was all ears. To hear him tell it, the price of labor is on the brink of making his firm, Guangzhou Fortunique, which supplies some of the U.S.'s biggest health care companies, uncompetitive. "We've seen our wage costs in China go up nearly 50% in the last two years alone," he says. "It's harder to keep workers on now, and it's more expensive to attract new ones. It's gotten to the point where I'm actively looking for alternatives. I think I'll be out of here entirely in a couple of years." (See "As China Economy Grows, So Does Labor Unrest.")He is not alone. In what is supposed to be a land of unlimited cheap labor — a nation of 1.3 billion people, whose extraordinary 20-year economic rise has been built first and foremost on the backs of low-priced workers — the game has changed. In the past decade, according to Helen Qiao, chief economist for Goldman Sachs in Hong Kong, real wages for manufacturing workers in China have grown nearly 12% per year. That's the result of an economy that's been growing by double digits annually for two decades, fueled domestically by a frenzied infrastructure and housing build-out — one that, for now anyway, continues apace — combined with what was for a time an almost unquenchable thirst for Chinese exports in the developed world. Add to that the fact that in the five largest manufacturing provinces, the Chinese government — worried about an ever widening gap between rich and poor — has raised the minimum wage 14% to 21% in the past year. To Harley Seyedin, president of the American Chamber of Commerce in Southern China, the conclusion is inescapable: "The era of cheap labor in China is over."Mind you, that doesn't mean that labor costs in China, even in the most expensive parts of the country like Guangdong province, are higher than in most other places, particularly in the developed world. They aren't. The average manufacturing wage in China is still only about $3.10 an hour, (compared with $22.30 in the U.S.), though in the eastern part of the country, it's up to 50% more than that. The hourly cost advantage, while still significant, is shrinking rapidly. For the vast majority of companies, whether small, medium-size or huge multinationals, the decision about where to produce a product is always driven by multiple factors, of which the cost of labor is but one. "For lots of companies over the past two decades, the disparity was such that labor costs often drove the decision," says economist Daniel Rosen, the China director and principal of the Rhodium Group, a New York — based consulting firm. "Now, increasingly, that's no longer the case." (See portraits of Chinese workers.)The ripple effects of this new reality are enormous, and they flow globally. Start with China itself. The push for higher wages, constrained for so many years, resulted in a series of high-profile labor protests last year, which included 14 worker suicides at Foxconn, the large manufacturer that produces goods like the iPad. But higher wages have also improved things in China's western region, where the government has long tried to encourage investment. In the past year, many multinational and Chinese companies have expanded or relocated inland, where labor is still cheap.From China's perspective, that's exactly the sort of trade-off it seeks. As Andy Rothman, chief China macro strategist at CLSA Securities in Shanghai, says, "People in Sichuan or Henan or wherever can stay closer to home and find a good-paying job" instead of having to flood east each year to live in a company dormitory far away from their families. "How is this a bad thing?"
Sweden's education minister said Wednesday that all schoolchildren will be taught Chinese within 10 years, reports AFP.If Jan Björklund's plan goes ahead, Sweden will be the first country in Europe to make Chinese compulsory.“Chinese will be much more important, from an economic perspective, than French or Spanish,” Björklund told the Dagens Industri newspaper.“Not everyone in the business world speaks English,” said Björklund. “Very qualified businesses are leaving Europe to move to China.”
The.Chinese.Are.Coming.1of2.Africa.HD==Western views of Chinese presence in Africa==中方在非洲 西方觀點==字幕==Subtitles
Nov. 21 (Bloomberg) -- China’s property market is reaching a “tipping point” and the slowdown in the housing industry will have a spillover effect on demand for steel and other construction materials, according to Nomura Holdings Inc.The risk of the nation’s economic growth falling to less than 8 percent in the first quarter is also higher than before because of the housing market, Zhang Zhiwei, a Hong Kong-based economist at Nomura, said on a conference call today.“The property sector has probably already reached a tipping point given the data is getting worse at a very fast pace,” Zhang said. “We’ve been here before in 2008 with housing investment and I feel we’re getting close to that stage. I’m more worried about the housing sector and the GDP of the first quarter.”China’s home prices fell in 33 of 70 cities monitored by the government in October, the worst performance since it expanded property curbs and scrapped the reporting of national average housing data this year, according to figures from the statistics bureau on Nov. 18.The country’s private housing investment is expected to increase 14 percent in 2012, matching the gain in 2008, which was the slowest in 10 years, Nomura said. So-called second- and third-tier or less affluent cities will drive the nation’s housing demand, the brokerage said.Longer Downturn“In the private market sector, the downturn will be longer than 2008 because the government is taking a different strategy by pushing public housing,” Zhang said. “Private housing will stay weak for quite some time.”Premier Wen Jiabao said this month that the government won’t relax property curbs. The government this year raised down-payment and mortgage requirements and imposed home purchase restrictions in about 40 cities to avert a bubble. The central bank also increased interest rates three times and reserves ratio six times this year.Analysts including Barclays Capital Research and asset managers such as CBRE Global Investors are betting price declines will force a policy reversal as the tightening weighs on economic growth. Zhang said he expects the government to maintain its housing measures and loosen monetary policy “gradually.”Shares FallThe gauge tracking property shares on the Shanghai Composite Index fell 0.5 percent at the midday break, dropping for a fifth day in its longest losing streak since Sept. 6.More than twice the number of cities posted declines in October compared with September, when 16 locations reported lower prices from August, according to the latest government data. Prices in 23 cities were unchanged in October and 14 recorded gains, the data showed.Housing values in the financial center of Shanghai and the southern business hub of Guangzhou fell 0.2 percent from the previous month, while those in Shenzhen, neighboring Hong Kong, slipped 0.1 percent. Beijing prices were unchanged.Home prices will fall between 15 percent to 30 percent in the next two years, Mark Mobius, who oversees $40 billion as Hong Kong-based executive chairman of Franklin Templeton Investments’ Emerging Markets Group, said before the housing data last week. BNP Paribas predicted a 10 percent decline by the second half of next year.“I expect more cities to fall month-on-month,” Zhang said. “We are certainly not at the worst moment yet.”Residential property accounted for 6.1 percent of the country’s gross domestic product last year, according to Citigroup Inc.--Bonnie Cao. Editors: Linus Chua, Andreea Papucvia : http://www.businessweek.com/news/2011-11-21/c
Homes in Beijing have seen a dramatic price drop as the year comes to a close. Insiders say the reduction comes as developers need cash returns that are not coming fast enough.A local property company has been promoting its houses in Beijingxiangsu community, located near the East Fifth Ring Road, for 11,600 yuan ($1,825) per square meter and some units are selling for as low as 480,000 yuan, according to the Beijing Morning Post.Figures from the Beijing Real Estate Trade and Management website show the average price of an apartment in this community has dropped from 22,500 yuan per square meter to 11,600 yuan, said the report.The company started pre-sales in June, but none of its apartment projects have sold out, a sharp contrast compared to last year's busy real estate market.Another builder, Vanke, has also reduced the price of several projects by 10 to 20 percent, indicating the housing market in Beijing is in a rapid decline, according to the report.Zhang Yue, a senior analyst at Beijing Homelink Real Estate, said many real estate companies followed Vanke's lead and reduced their price by between 10 and 20 percent."It is unusual to see a 50 percent reduction," said Zhang.An anonymous staff member at a local property company told the paper a half-price home comes close to the original cost of the property, adding possible reasons for the huge discount."At the end of the year, many real estate developers have to repay loans to the bank and pay the construction workers," he said.Yu Liang, the president of Vanke, recently told the press his company has "gone into hibernation.""Cash on hand is more important than profits now," he said.Zhang Dawei, marketing director of Centaline Real Estate Beijing, told the Global Times the decrease in home prices shows the government's policy on the housing market, such as purchase restrictions and loan regulations, has had an effect."If the government doesn't loosen the policy, I think the prices might keep dropping lower," he said.
6:34am UK, Friday November 25, 2011Holly Williams, Asia correspondentChina's "ghost cities" show that the country's economic boom could be more fragile than it appears.Kangbashi is a showcase city, laid out spaciously on the grasslands of northern China.It was dreamt up by the local secretary of the Communist Party as a monument to the country's new-found prosperity.The place is dominated by impressive public buildings - a marble-clad library, a state-of-the-art theatre and a giant convention centre.In the centre of town a 70m-high statue of two fighting horses looms over Genghis Khan Square.The only thing missing is the people.Kangbashi was built to house one million residents, but so far only 20,000 have moved in.Like many roads in the sparsely-populated city of Kangbashi, this one lies emptyAcres of apartment complexes - many of them luxurious by Chinese standards - are deserted. Store fronts are boarded up. When they first began building Kangbashi, there was a frenzy of investment. The local government contributed a £200m road network. Nearly all of the homes that now lie empty were sold off-plan.The buyers were China's cashed-up new middle class. The country's poorly-regulated stock markets, along with controls on investing overseas, have made second, third and even fourth homes a popular store of wealth.But from the very outset, Kangbashi defied all economic logic. There's no industry in the city, and no real reason to live there.Now Kangbashi - along with other "ghost cities" dotted around China - has come to symbolise what many believe is a dangerous property bubble that could be primed to pop.The scale of China's housing boom is staggering. Over the past five years the country has built nearly 40 million new homes. In some cities the price of housing has tripled in the same period.Chinese economist Zhang Bin said: "If you look at financial crises, they're always accompanied by property bubbles."Lower property prices would definitely be more sustainable and healthy, but a sharp drop would mean a big contraction in the economy and problems like unemployment."Kangbashi's public buildings are impressive, but not very busy.In Kangbashi, many think the bubble has already popped.Businessman Wang Pen spent his life savings buying a two-bedroom apartment. He says its value has fallen by 20% since the start of the year.But Mr Wang finds it difficult to believe that the good times will ever stop rolling."When I bought this one three years ago I was still poor, so it's a bit small," he said."Now I'm thinking of getting another place, something bigger."If the bubble pops on a nationwide scale, it could be disastrous, not just for China, but for global economic recovery.China is now the world's second-biggest economy, and by some estimates nearly half of its GDP is in some way linked to property.Alistair Thornton, Beijing-based economist with HIS Global Insight, said: "Property is the core of the Chinese economy."With the eurozone weak and the US stagnant, a sharp contraction in the world's largest growth engine would have a dramatic effect. It's not a good story."
High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/a77dde82-3cc3-11e1-8d38-00144feabdc0.html#ixzz1jDAZRG8ZChinese inflation edged down in December, setting the stage for a continuation of cautious policy loosening to support the slowing economy.Consumer prices rose 4.1 per cent from a year earlier, the lowest in 15 months and well below July’s peak of 6.5 per cent.
Mixed view on China manufacturingBy CNNMoney staff @CNNMoney April 1, 2012: 8:52 PM ETNEW YORK (CNNMoney) -- China watchers got a mixed view over the weekend of the country's all-important manufacturing sector.China's government reported that manufacturing expanded in March, while a closely-watched private report said factories struggled with poor demand for their products.The National Bureau of Statistics said Sunday that its official index of purchasing managers' sentiment rose to 53.1 in March from 51 in February. Any reading above 50 indicates expansion in the sector.The March report marked the fourth consecutive monthly increase and the index's highest reading in a year.At the same time, banking company HSBC issued a report that showed factory output fell in March for the fourth time in five months."Factory output was reduced largely in response to lackluster demand from domestic and external markets," the HSBC report said.The contrasting reports follow a pattern of recent months, as the two indexes have diverged.Investors and analysts have been concerned that China's extraordinary growth may be slowing too quickly.Chinese Premier Wen Jiabao rattled investors recently when he said that China's new gross domestic product growth forecast for 2012 is 7.5%, down from an earlier prediction of 8%.A "hard landing" by China could ripple throughout the world. Troubles in Europe, the largest market for China's goods, have intensified fears about a China slowdown.Of course, China's growth far exceeds what many developed countries are experiencing. China's GDP rose 9.2% last year, while the U.S. economy grew 1.7%. First Published: March 31, 2012: 11:05 PM ET
