Chinese Economics Thread

[sunnymaxi]

FDI into China fell below zero in Q3, for the first time on record, but China's outbound direct investment rising
View attachment 121079View attachment 121082

they are counting outflow. LOL but its okay

now its opposite. China doesn't need FDI anymore. whatever comes is just a bonus.

China's outbound direct investment is on rise Chinese firms are now investing money in other countries. because foreign/Domestic industries are now well established in mainland , supply chain is well intact. due to stiff competition many firms are dying in mainland. Koreans/Japanese firms losing market share. thanks to Rise of Chinese local firms in manufacturing. Chinese firms start gaining share from west/Japanese/Koreans firms in Global south.

China's outward direct investment maintains growth momentum, overseas M&A in Latin America and Oceania surges. China overall ODI was US$75.4 billion in H1 2023, up 9.6% YOY.

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Official statement from Ministry about FDI in China

Foreign direct investment (FDI) in the Chinese mainland in actual use stood at 919.97 billion yuan (about $128 billion) in the first nine months of the year, the Ministry of Commerce said Friday.

The figure decreased 8.4 percent from a year earlier.

During the period, 37,814 new foreign-invested firms were set up across the country, up 32.4 percent year on year.

FDI in service sector decline 12.8 percent year on year.

FDI in manufacturing rose 2.4 percent year on year, with that in high-tech manufacturing up 12.8 percent.

During the period, FDI from France, the United Kingdom, Canada , Germany and Japan surged by 121.7 percent, 116.9 percent, 109.2 percent, 53 percent and 14.2 percent year-on-year respectively, data from the ministry shows..

 

[CMP]

they are counting outflow. LOL but its okay

now its opposite. China doesn't need FDI anymore. whatever comes is just a bonus.

China's outbound direct investment is on rise Chinese firms are now investing money in other countries. because foreign/Domestic industries are now well established in mainland , supply chain is well intact. due to stiff competition many firms are dying in mainland. Koreans/Japanese firms losing market share. thanks to Rise of Chinese local firms in manufacturing. Chinese firms start gaining share from west/Japanese/Koreans firms in Global south.

China's outward direct investment maintains growth momentum, overseas M&A in Latin America and Oceania surges. China overall ODI was US$75.4 billion in H1 2023, up 9.6% YOY.

-------------------------------------------------------------------------
Official statement from Ministry about FDI in China

Foreign direct investment (FDI) in the Chinese mainland in actual use stood at 919.97 billion yuan (about $128 billion) in the first nine months of the year, the Ministry of Commerce said Friday.

The figure decreased 8.4 percent from a year earlier.

During the period, 37,814 new foreign-invested firms were set up across the country, up 32.4 percent year on year.

FDI in service sector decline 12.8 percent year on year.

FDI in manufacturing rose 2.4 percent year on year, with that in high-tech manufacturing up 12.8 percent.

During the period, FDI from France, the United Kingdom, Canada , Germany and Japan surged by 121.7 percent, 116.9 percent, 109.2 percent, 53 percent and 14.2 percent year-on-year respectively, data from the ministry shows..

Anyone including outflow to create highlights of bleak-sounding historical firsts is doing so as a member and advocate of the Zeihan/Chang cult.

 

[SanWenYu]

Ministry of Commerce now requires rare earth exporters to follow this

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(excerpt following) issued by National Bureau of Statistics.

Not sure what's in plan by China on rare earth. I would be really surprised, and annoyed, that China hasn't been counting its rare earth exports in details until now.

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商务部：将实施出口许可证管理的稀土纳入《实行出口报告的能源资源产品目录》​

商务部网站7日消息，根据国家统计局令2017年第22号（《部门统计调查项目管理办法》）规定，商务部结合近年来我国大宗产品进出口情况和管理需要，对2021年制定的《大宗农产品进口报告统计调查制度》进行了修订，并更名为《大宗产品进出口报告统计调查制度》，经国家统计局批准执行（国统制〔2022〕165号）。在大豆、油菜籽、豆油、棕榈油、菜子油、豆粕、鲜奶、奶粉、乳清、猪肉及副产品、牛肉及副产品、羊肉及副产品、玉米酒糟、关税配额外食糖等14种产品继续实行现行进口报告制度的基础上，主要新增内容如下：

一、将实施进口许可证管理的原油、铁矿石、铜精矿、钾肥纳入《实行进口报告的能源资源产品目录》，将实施出口许可证管理的稀土纳入《实行出口报告的能源资源产品目录》。进口、出口上述产品的对外贸易经营者应履行有关进出口信息报告义务。

二、商务部委托中国五矿化工进出口商会负责上述新增5类能源资源产品报告信息的收集、整理、汇总、分析和核对等日常工作。

现将《大宗产品进出口报告统计调查制度》印发给你们，自2023年10月31日起执行，执行期至2025年10月31日。

Specifically, the said National Bureau of Statistics directive requires these information from the importers and exporters:

二、调查内容

本制度主要内容包括对《大宗产品进出口报告目录》中大宗农产品及能源资源产品的对外贸易经营者，应分别向中国食品土畜进出口商会、中国五矿化工进出口商会报告每笔进出口商品名称、商品编码、贸易方式、贸易国别、原产地国别（地区）、合同号、合同数量、合同船期、装运地、预计抵达时间、实际船期、装运数量、报关口岸等。

Basically the bureau wants to know the amount of commodities per shipment, when and where it is from (for imports) and where it is going (for exports), etc.

 

[Minm]

Worth noting that measurements of Chinese consumption are undercounting actual consumption because a lot of it is "in-kind" (e.g. subsidised by the state) and thus doesn't show up in GDP accounting as it isn't private consumption per se. A good example are subsidised lunches but there are many others.

China's problem is very rapid debt accumulation. Right now it isn't a major problem but it will be 10-15 years from now unless there is a radical re-orientation. Note that when Xi took power it was only 34% of GDP. Now it will hit 100% of GDP within a few years. This is on him. It was also pretty stable, even after the GFC. So this is clearly his policies.

View attachment 120983

Given how poor China still is (per capita GDP lower than Mexico and Bulgaria) there is simply no justification for why the state should accumulate this much debt at a comparatively modest level of development.

Debt accumulation is not necessarily a problem. A debt to GDP ratio of 30% just means that the country isn't using all options available to it. It's a missed opportunity.

In a time where most countries have very high domestic debt, the countries that insist on lowering the debt will fall behind. Take the German obsession with the government deficit as an example. Low investment leads to poor infrastructure and no preparations for the future. When the US and many European countries are accumulating major deficits, the country that refuses to do the same will fall behind. As long as the money is spent on productive assets rather than social benefits, it's good debt

Debt only becomes an issue when interest payments take a too high proportion of government revenue. However, interest paid to SOEs and state owned banks is essentially government revenue and even interest received by private individuals or entities is fed back into the system as they spend it

 

[henrik]

Ministry of Commerce now requires rare earth exporters to follow this

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(excerpt following) issued by National Bureau of Statistics.

Not sure what's in plan by China on rare earth. I would be really surprised, and annoyed, that China hasn't been counting its rare earth exports in details until now.

Please, Log in or Register to view URLs content!

Specifically, the said National Bureau of Statistics directive requires these information from the importers and exporters:



Basically the bureau wants to know the amount of commodities per shipment, when and where it is from (for imports) and where it is going (for exports), etc.

They were probably inept when it comes to counting exports. The big guy thinks his people are smart enough, but still they were probably too lazy to do it.

 

[Michael90]

They were probably inept when it comes to counting exports. The big guy thinks his people are smart enough, but still they were probably too lazy to do it.

That would be shocking if what you said is indeed true. Don't think that's the case though

 

[Bellum_Romanum]

They were probably inept when it comes to counting exports. The big guy thinks his people are smart enough, but still they were probably too lazy to do it.

And your evidence on this is from what source? Mr. MrNA Vaccine salesman.

 

[sunnymaxi]

2023: from 5% to 5.4%

2024: from 4.2% to 4.6%

Moreover, China's economic growth no longer relies on real estate, and its core driving forces now are Manufacturing , High Tech growth and consumption.

 

[gelgoog]

I think real estate will eventually recover. China is still much less urbanized than advanced economies. Like 60% instead of 80%.
But the sector was overheating too much and construction companies were loaded with debt. So the government had to cut it down a notch.

I expect construction of high speed rail and metros to cool down during this decade. But there is still going to be a huge demand for construction of infrastructure, except this might be in clean energy generation, like nuclear power plants or building hydropower plants in the rivers downstream from the Himalayas. Also in pumped storage facilities.

Eventually we might see construction of higher speed maglev lines in the most congested transportation routes like Beijing-Shanghai.

At the same time Chinese industry will continue to move upwards in the industrial production chain by producing and exporting high tech products like aircraft, cars, and semiconductors. I also expect China to become a major weapons exporter.

 

[Jiang ZeminFanboy]

I think real estate will eventually recover. China is still much less urbanized than advanced economies. Like 60% instead of 80%.
But the sector was overheating too much and construction companies were loaded with debt. So the government had to cut it down a notch.

I expect construction of high speed rail and metros to cool down during this decade. But there is still going to be a huge demand for construction of infrastructure, except this might be in clean energy generation, like nuclear power plants or building hydropower plants in the rivers downstream from the Himalayas. Also in pumped storage facilities.

Eventually we might see construction of higher speed maglev lines in the most congested transportation routes like Beijing-Shanghai.

At the same time Chinese industry will continue to move upwards in the industrial production chain by producing and exporting high tech products like aircraft, cars, and semiconductors. I also expect China to become a major weapons exporter.

Looking at the plans for HSR and metros this decade there won't be any cooling down and that's good. Maybe after 2035.