Chinese Economics Thread

[TK3600]

The moral argument is not functionally relevant here because what happened in the end - a forced, unplanned and uncoordinated opening, did not prevent the excess deaths that they were looking to prevent.

On one hand, there was economic/political costs imposed on society for sticking to ZCP - a noble cause that I can appreciate - but on the other hand there was virtually zero preparation done (as evidenced by aspirin shortages - note I don't even count hospital crowding because there is less capacity to ramp up capacity there than there is for drugs) to prevent the chance of mass death - especially as it was clear that ZCP was unsustainable and unviable.

The only credible argument you can make would be that they intended for ZCP to last 5 years - in which case the economy is done for.

Nobody is saying that one "prefers to kill old people" - but Presidents do not make easy decisions. The options to Xi were: an ebbing social unrest and the risk of economic implosion from continued ZCP vs. 1 mln dead old people who should've been vaccinated. Yes, its like choosing ice cream flavoured crap vs. crap flavoured ice cream - but its clear that the cost/benefit skewed one over the other.

Idk man, China has huge population if they did it American way they should die a lot more. China had remarkably less death than what it could have been.

I think you should differentiate the criticism of "Xi made suboptimal decision, could have openned couple month earlier without much difference in death"

versus

"It was a complete waste and people died as much either way"

First one is completely valid. Second one is a radical proposal that needs significant proof.

Now with that out of way I think the stability argument makes sense. At first everyone was scared and called for drastic measure. Party was scared to open up and take potential responsibility. But if it were locking too much, weak economic also breeds stability. So when people demanded open they complied.

And regardless, ZCP will end few month later without protest. There is no 5 year lock down lol.

 

[supercat]

China’s economic slump different from Japan in 1980s, with greater growth prospects despite ageing population: Ong Ye Kung​

Older people can continue contributing to the economy, while technology can help to improve productivity and reduce reliance on manpower, enabling ageing societies to continue growing, said Singapore’s Health Minister Ong Ye Kung.

Mr Ong also noted that China’s current circumstances are “very different” from Japan’s in the 1980s, when its property bubble burst amid an ageing population, bringing about prolonged deflation and slowdown.

“Unlike Japan in the 1980s where its per capita income was higher than the US, China’s per capita income today is only about one-third that of the US. There is much more headroom for China to continue its growth path, once it gets over its current slump,” he said.

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Brad W. Setser's current view on the matter:

China's Current Account Surplus Is Likely Much Bigger Than Reported​

The IMF needs to focus on China’s external account in its surveillance. The reported current account surplus appears to be significantly too low.

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The numbers game: IMF projection on a PPP basis: by 2028, China's share of global GDP will be 19.56%, while America's will be 14.57%. So on a PPP basis, The size of China's economy will be approx. 134% of the US' by 2028. For 2023, it's 18.82% vs 15.42%, China's size is approx. 122% of America's.

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[Lethe]

Not sure if this is the right thread...

Despite this article framing China's ongoing energy transition as part of Xi Jinping's quest for "global domination", and referencing the "drastic slowdown" in China's economic growth associated with the "exhaustion of its Ponzi-style property model", this is actually one of the most positive articles I have read about China in the mainstream Anglo media in quite some time:

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China’s carbon emissions have either peaked already or will do this winter, seven years ahead of schedule [....] The country’s target of net-zero by 2060 is likely to be achieved a decade earlier than previously assumed, and perhaps earlier than in Europe.

The International Energy Agency says China accounts for 60 per cent of all new solar and wind power being installed across the world this year and next [....] China is building a gargantuan network of “clean energy bases” in the Gobi, Ordos, and Tengger deserts, and further across the arid wastelands of the northwest. Solar and wind parks run along an arc from Inner Mongolia to Qinghai on the Tibetan plateau.

The electricity will reach the cities of industrial China through ultra-high voltage cables, which cut transition losses to 3.5 per cent per 1000 kilometres. The scale is staggering.

[.....] Xi seeks global supremacy. He was never going to let climate worries alone hold back China’s rise. But today the two are in perfect alignment. Clean-tech has become the spearhead of China’s global economic conquest, and this changes the thrust of Beijing’s climate diplomacy.

In a truly radical departure from standard Anglo practice, the authour even writes favourably about Xi Jinping personally!

Xi Jinping was green long before it became fashionable. He wrote a weekly column twenty years ago as Zhejiang party chief warning that China’s “energy-intensive and high-polluting” economic model was unsustainable.

He defied the orthodoxy of break-neck industrialisation and GDP worship, launching a radical ‘Green GDP’ programme in Zhejiang in 2004. It called on local governments to subtract ecological damage from the raw GDP figures.

Regarding the substance of the article, this bit about carbon capture and storage caught my eye:

The coal that is burned will increasingly come with carbon capture. The mining province of Shanxi has a project underway to turn CO2 into ‘gold’ by making carbon nanotubes, which boost the power of lithium-ion batteries in EVs.

My admittedly uninformed and possibly outdated understanding was that all these proposed carbon capture and storage mechanisms are just expensive methods of accomplishing very little, a figleaf offered by coal and other fossil fuel producers to pretend that they are actually doing something to reduce carbon emissions. Is this inaccurate? Has China actually made CC&S work?

 

[Michaelsinodef]

Not sure if this is the right thread...

Despite this article framing China's ongoing energy transition as part of Xi Jinping's quest for "global domination", and referencing the "drastic slowdown" in China's economic growth associated with the "exhaustion of its Ponzi-style property model", this is actually one of the most positive articles I have read about China in the mainstream Anglo media in quite some time:

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In a truly radical departure from standard Anglo practice, the authour even writes favourably about Xi Jinping personally!



Regarding the substance of the article, this bit about carbon capture and storage caught my eye:



My admittedly uninformed and possibly outdated understanding was that all these proposed carbon capture and storage mechanisms are just expensive methods of accomplishing very little, a figleaf offered by coal and other fossil fuel producers to pretend that they are actually doing something to reduce carbon emissions. Is this inaccurate? Has China actually made CC&S work?

Pretty sure China has yet to make CC&S work, and we might never know if they or anyone can (with work, meaning economically feasible/viable in the medium and long term, as well as scalable).

Doesn't stop experimentation and testing, as well as developing the tech further etc. (in fact, that is needed to even have a chance of making it work).

 

[sunnymaxi]

China will have 2.3 Billion Internet of Things (

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) devices by the end of 2023, up 30% YoY. And China has rolled out over 3.2 Million

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base stations, while the value of its digital economy exceeds RMB 60 Trillion in 2023, up 25% YoY.. Ministry has announced today

 

[Andy1974]

Or the Chinese economy is much bigger than is commonly thought.

I keep hearing this, and I’d really like to know more.

I have heard that Chinas “grey” economy is not counted as part of GDP, also that some night time economics are not included. I’m not sure if any of this is true.

Does anyone have any decent evidence that Chinas economy is actually quite a bit bigger than official statistics show?

I am not talking about fake GDP, such as the USA uses to pump it’s numbers, but actually real economic activity which would normally be included in a countries GDP calculation, but which is not in China.

Thanks!

 

[xlitter]

I keep hearing this, and I’d really like to know more.

I have heard that Chinas “grey” economy is not counted as part of GDP, also that some night time economics are not included. I’m not sure if any of this is true.

Does anyone have any decent evidence that Chinas economy is actually quite a bit bigger than official statistics show?

I am not talking about fake GDP, such as the USA uses to pump it’s numbers, but actually real economic activity which would normally be included in a countries GDP calculation, but which is not in China.

Thanks!

In China's GDP statistics, only enterprises above the designated size will be counted, while companies below the designated size will only be estimated. Economies of scale used to be more than 5 million yuan, but now are more than 20 million.

 

[Andy1974]

In China's GDP statistics, only enterprises above the designated size will be counted, while companies below the designated size will only be estimated. Economies of scale used to be more than 5 million yuan, but now are more than 20 million.

If the estimate is good then the activity is included in gdp statistics, right?

 

[Blitzo]

Multiple pages of off topic posts relating to India deleted.

Come on people, just because you see an easy avenue for off topic conversation that has a nationalistic twinge, doesn't mean you need to take it.

Exercise some restraint.

 

[zbb]

I have heard that Chinas “grey” economy is not counted as part of GDP, also that some night time economics are not included. I’m not sure if any of this is true.

Does anyone have any decent evidence that Chinas economy is actually quite a bit bigger than official statistics show?

I am not talking about fake GDP, such as the USA uses to pump it’s numbers, but actually real economic activity which would normally be included in a countries GDP calculation, but which is not in China.

Thanks!

A couple of old articles from 2014 and 2015, but AFAIK China has not had any major revisions to its official GDP methodology since then.

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A 2008 Morgan Stanley study estimated that Chinese GDP was about 30 per cent higher than official figures, and per capita consumption was as much as 80 per cent higher. Some research surveys show that household income has been understated by some 20-30 per cent of GDP.

There is some official support for such views. The head of the national accounts department at China’s bureau of statistics acknowledged in 2009 that its household consumption figures are deficient. The statistics are based on an obsolete, 30-year-old sample survey; do not take full account of cash transactions; do not include fully non-cash provision of social services; and have not been adjusted to reflect the market values for owner-occupied housing. Moreover, as a result of high sales taxes, businesses often do not issue receipts leading to household purchases being underreported.

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China’s consumption rate is widely believed to be too low. In this paper, we show that official statistics have significantly underestimated Chinese household consumption. First, a lot of private consumption is paid for by companies but cannot be accounted for in official statistics. Second, housing consumption is underestimated because of the construction cost-based method. Third, and most important, high-income households are significantly underrepresented in the household surveys upon which household consumption statistics are based.