Chinese Economics Thread

[Hendrik_2000]

Looks like after a strong first half of 2010, China's export industry might have some trouble in the second half. With the Euro falling because of the public debt problems and austerity messures taken in many countries, the european market might become less profitable for chinese exports for the time being. However, imports would become cheaper.
But of course, China will still be running a solid trade surplus.

How is China doing with it's domestic market anyway? Rather low development priority in terms of staying competitive with it's export oriented industry, or trying to increase public demand for it's own goods, thereby also making it easier for foreing companies to sell things there?

I don't believe that even with turndown in Europe, Chinese export will be completely stopped . You see most of Chinese product are daily necessity that even in economic downturn will find demand. The first reaction when Economic hardship hit is too save as much as you can which play to Chinese advantage since their consumer product are mostly priced for lower middle class.

Domestic grow by 17% last year but domestic demand is not going to replace export anytime soon. It will take a long time to be the main driver of economy. Having said that it doesn't mean that domestic demand doesn't grow or play a role in the economy. Not too long ago the dream of every chinese family is to own Bicycle, Sewing maching, Watch. Then in 80's Refrigerator, TV, Washing Machine . Now Home, Car, Travel.

Wages are growing at fast clip of 20% Most of coastal province will soon reached 10.000 Dollar GDP/per capita. I believe Guangdong, Jiangsu,Zhejiang and Beijing already reached that figure It will soon follow by Shandong, Fujian and Inner Mongolia.

but the impulse to save is deeply ingrained in Chinese Psyche. Partly out of necessity poor health care plan and costly education. Also Chinese culture value saving over consumption, Remember that today Chinese is only one generation away out of periodic famine and crop failure

Plan is underway to vastly improve the health plan with universal health care as a goal . But it will take a generation to change the consumption habit of China

 

[Scratch]

I really did not mean to say chinese export will just stop, just that it probably will be felt. And yes China also exports a lot of basic goods wich people still need even if they have to safe.
However, as I understand China obviously becomes also more adapt at making and selling more technology prone products, like entertaiment stuff, smart phoes etc. I'd assume that those industries feel global economy problems more then others. Or is the export volueme of these industries so small that nobody will really feel it.

 

[Hendrik_2000]

I really did not mean to say chinese export will just stop, just that it probably will be felt. And yes China also exports a lot of basic goods wich people still need even if they have to safe.
However, as I understand China obviously becomes also more adapt at making and selling more technology prone products, like entertaiment stuff, smart phoes etc. I'd assume that those industries feel global economy problems more then others. Or is the export volueme of these industries so small that nobody will really feel it.

You are right. Contrary to popular believe more than 50% of Chinese export to EU are in fact Electrical machinery and office product.

But since most of them are owned by MNC OR Taiwan and Japanese investor outsourcing product from all over Asia. I don't know what will be the impact on Chinese economy hard to say

 

[Martian]

China's $576 Billion High-tech Exports

You are right. Contrary to popular believe more than 50% of Chinese export to EU are in fact Electrical machinery and office product.

But since most of them are owned by MNC OR Taiwan and Japanese investor outsourcing product from all over Asia. I don't know what will be the impact on Chinese economy hard to say

Greater China's patents play an important role in China's high-tech exports.

For 2009, due to the Great Recession worldwide, China's top two high-tech exports for "Electrical machinery & equipment" and "Power generation equipment" dipped to $537.1 billion US dollars. However, if we add in the $38.9 billion from "Optics and medical equipment" then the overall high-tech exports for 2009 are $576.0 billion U.S. dollars. See "Table 5: China's Top Exports 2009 ($ billion)."

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[Martian]

China Claims #9 Rank In United States Patents!

For 2009, China passed Italy to claim the ninth-highest rank for countries that receive the most patents in the United States.

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Patents granted by the United States for the year 2009.

1. U.S. 95,037 patents
2. Japan 38,066
(Greater China 10,638)
3. Germany 10,353
4. South Korea 9,566
5. Taiwan 7,781
6. Canada 4,393
7. U.K. 4,011
8. France 3,805
9. China 2,270
10. Italy 1,837
...
India 720
Hong Kong 587 (Patent office counts Hong Kong as a separate entity)
Singapore 493
Russian Federation 204
Brazil 148

For 2009, Greater China's 10,638 combined total patents (i.e. China's 2,270 + Taiwan's 7,781 + Hong Kong's 587) are greater than Germany's 10,353 patents. Greater China would rank third on the U.S. patent list. The patent ranks are important because they help to explain why China is the world's largest exporter and Germany is the world's second-largest exporter. Patents play an important role.

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[Note: These are my comments from last year on "Greater China outnumbers German patents."

There are 70,000 Taiwanese companies on the Chinese Mainland. It is my guess that many Chinese exports incorporate not only Chinese patents, but also Taiwanese patents. The Taiwanese were a perennial #4 in U.S. patents received until they were passed by South Korea in 2008.

While the current number of Chinese patents appears to be insufficient to support a large high-tech export base, the combination of Greater China (i.e. Chinese, Taiwanese, and Hong Kong) patents should suffice.

Greater China's 10,370 patents (i.e. China's 1,874 + Taiwan's 7,779 + Hong Kong's 717) are greater than the number of German patents at 10,086.

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"Significant migration to Taiwan from the Chinese mainland began as early as A.D. 500. ..... There are a number of small political parties, including the Taiwan .... in China, and more than 70000 Taiwan companies have operations there. .... In keeping with our one China policy, the U.S. does not support Taiwan ..."

 

[Martian]

Greater China's Innovations Are Showing Results

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"The 50 Most Innovative Companies April 15, 2010, 5:00PM EST

The 50 Most Innovative Companies
For the first time since Bloomberg BusinessWeek began its annual Most Innovative Companies ranking in 2005, the majority of corporations in the Top 25 are based outside the U.S. The reason: the new global leaders coming out of Asia
...
The extended Top 50 list is dominated by companies from Europe, Asia, and, in another first, South America (Petrobrás (PBR) of Brazil at No. 41). China's rise is biggest. A year ago its only representative was PC-maker Lenovo Group (LNVGY), at 46. This year Greater China is tied with Asia's postwar powerhouse, Japan, thanks to showings by BYD, Haier Electronics (27), Lenovo (29), China Mobile (CHL) (44), and Taiwan-based HTC (47). The age of Asian innovation has begun."

 

[Martian]

China Leads All Nations in Publication of Chemical Patents According to CAS

Let's hear it from the "global expert" CAS on China's chemical patents.

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"China Leads All Nations in Publication of Chemical Patents According to CAS, the World's Most Authoritative Publisher of Chemical Information

Columbus, Ohio (November 23, 2009) - Chemical Abstracts Service (CAS), the global expert on chemical information, reports that China's patent office is now the world's leading producer of patent invention applications in chemistry. China trailed Japan's patent office, the World Intellectual Property Organization (WIPO), and the United States Patent and Trademark Office (USPTO) for more than a decade, but passed the USPTO in 2005, WIPO in 2006, and exceeded Japan for the first time on a monthly basis in 2008. In 2009, China will record an entire year as the number one producer of chemical patents, and CAS projects that trend to continue.

"Chemistry is widely recognized as 'the central science,'" according to Dr. Matthew Toussant, senior vice president of editorial operations at CAS. "Chemical patents are a critical component to many industrial processes and scientific realms, including medicine and natural products," said Toussant. "In fact, on average, 35 percent of new patent invention applications involve chemical substances."

"CAS has been recording the phenomenal growth of patent documents in the last decade, with the number of chemistry-related patent publications by the USPTO and WIPO growing by more than 500 percent," said Christine McCue, vice president of marketing at CAS. "Meanwhile, Chinese invention applications increased by nearly 1,400 percent, with much of that growth taking place in the pharmaceutical sector. More than half of the Chinese patent applications during this period were from inventors within China, which surely indicates that Chinese scientists now also recognize the importance of monetizing research discoveries."

Hundreds of CAS scientists, aided by state-of-the-art technology, identify and record the chemistry obscured in patents that standard search engines cannot locate. Proprietary technology systems developed by CAS enable scientists working around the world to analyze patents from 60 global patent authorities. Patent documents meeting CAS selection criteria from nine major patent offices are available in CAS databases within two days of the patents' issuance, and are fully indexed in less than 27 days. CAS scientists add value to the data they collect, entering chemical names, a unique CAS Registry Number, literature references, property data, commercial availability, preparation details, spectra, and regulatory information from international sources into CAS databases.

Media Contact

Crystal Poole Bradley
614-447-3611
[email protected]"

 

[Martian]

European Patent Office (EPO) says that patents lead to higher GDP/economic growth

Serious organizations, such as the European Patent Office (EPO), around the world believe that patents lead to higher GDP/economic growth. See

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"The EPO is convinced that patents could have "an even stronger impact on economic growth" once the patent system is better known in Europe and a patent culture develops similar to that of the United States."

 

[pla101prc]

well if you throw enough money at it progress is bound to come...

 

[Orthan]

It appears dark clouds are gathering in US-China relations after g-20 summit. If china doesnt make concessions to the US, there could be trouble...

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I disagree in that china export unenployment not to the US, but rather to other developing countries.

China says US sanctions because of currency manipulation are against WTO rules.

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That may be correct. However Pascal Lamy, head of the WTO, said that is in fact a question rather to the IMF

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what do do you think will happen?