Chinese Economics Thread

[Anlsvrthng]

No, coastal regions tend to be wealthier because they have the benefit of low-cost seaborne freight transport compared with expensive low-capacity trucks or trains.

So it just makes sense for population/industry/jobs to gravitate to where transportation costs are lowest.

That is another proof for that certain imbalances are built into the country, and no infrastructure investment can solve them.

Even if the EU central government has got an income and real power, it still doesn't solve the issue that the EU is a fragmented market split up by different languages/cultures/currencies. It means people, companies, goods and services are stuck within their respective national borders. Of course, there could be a single market if the EU mandated a SINGLE national language and therefore a single political forum for all of Europe, but we all know that is not going to happen.

The EU market is not fragmented any more.

The language barriers are less problematic than it should to an outsider, even before the EU it was a requirement for the majority of office jobs to talk at least one another language,

If I go around any shop in any European country then I see good from all over EU.


So, the marekt integration is very deep, regards of goods/services /work flow inside the EU.

Only thing is missing the central government, to iron out the imbalances.

Japan is already a wealthy developed country with amongst the highest living standards in the world and a slowly declining population.
So of course it is going to show zero to stagnant economic growth.

If we talk about China's growth returning to the mean, remember that China's peer group are the other confucian East Asian Economic Tigers (Japan, Korea, Taiwan, Hong Kong , Singapore). And they did grow fast enough to get through the middle income trap

All of them ride the export as engine of growth, but China is too big to follow that route.

They still depending the US export as the main growth source.

I just have to check any USA shop for the proof of it.

 

[taxiya]

All of them ride the export as engine of growth, but China is too big to follow that route.

They still depending the US export as the main growth source.

I just have to check any USA shop for the proof of it.

That is totally ridiculous way of thinking. US shop full of Chinese goods ONLY means US rely on Chinese import. It is NOT necessarily true the other way around.

In Chinese University it is a fundamental course for engineering discipline. And it is one of the three section of GRE test to enter any US university for post-graduate education in Engineering. So guess that is true in your country too. Check it there

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Since you have been posting pages of number and formula of Space science, I have assumed that you are educated in engineering major in university. It seems you fall asleep in class room?

 

[Anlsvrthng]

That is totally ridiculous way of thinking. US shop full of Chinese goods ONLY means US rely on Chinese import. It is NOT necessarily true the other way around.

In Chinese University it is a fundamental course for engineering discipline. And it is one of the three section of GRE test to enter any US university for post-graduate education in Engineering. So guess that is true in your country too. Check it there

Please, Log in or Register to view URLs content!

Since you have been posting pages of number and formula of Space science, I have assumed that you are educated in engineering major in university. It seems you fall asleep in class room?

US shops full of Chinese goods is a necessity condition for :
a. the Chinese dependence on USA market
b. The USA dependence on Chinese production capacity.

It is not sufficient to choose a or b.

Problem is the see the necessary conditions for the Chinese / Japanese/ Taiwanese / SK dependence on the USA markets we needs to see the effects if we cut them off from the USA market.

And practically here end the usefulness of the mathematical idea of n/s .
In math it used to proof a theorem in math, but in reality there is only chance.

So, when the USA decreased the Japanese import, Japan went into decade long recession.
We can see now the repetition of this experiment again, and if Trump run a full round then we will see if this is the case.

However, the Chinese / USA reactions showing support the "a" version, considering China doesn't like the customs, and USA likes it.

And additionally, the world full of idle production capacity and idle human capital. Check Spain or Japan.

 

[taxiya]

US shops full of Chinese goods is a necessity condition for :
a. the Chinese dependence on USA market
b. The USA dependence on Chinese production capacity.

It is not sufficient to choose a or b.

Problem is the see the necessary conditions for the Chinese / Japanese/ Taiwanese / SK dependence on the USA markets we needs to see the effects if we cut them off from the USA market.

And practically here end the usefulness of the mathematical idea of n/s .
In math it used to proof a theorem in math, but in reality there is only chance.

So, when the USA decreased the Japanese import, Japan went into decade long recession.
We can see now the repetition of this experiment again, and if Trump run a full round then we will see if this is the case.

However, the Chinese / USA reactions showing support the "a" version, considering China doesn't like the customs, and USA likes it.

And additionally, the world full of idle production capacity and idle human capital. Check Spain or Japan.

I will save the time of both of us by just making my interpretation of the logic
US shops full of Chinese goods is

1. sufficient to prove US dependence on Chinese production capacity (your point b),
2. but is not necessary to prove China's dependence on US market (your point a).

Your a and b are one being necessity, the other being sufficiency. They are the two opposing vectors of the logical equation, NOT two vectors on the same side.

I will let yourself to figure out what is the other vector to prove the Chinese dependency on US market.

[Edit]
An advice to verify whether one's logic is sound is to express that logic in a sentence that is grammatically correct. I learned that from the GRE preparation.

 

[Anlsvrthng]

I will save the time of both of us by just making my interpretation of the logic
US shops full of Chinese goods is

1. sufficient to prove US dependence on Chinese production capacity (your point b),
2. but is not necessary to prove China's dependence on US market (your point a).

You using 1 as logical result of that we see Chinese / Taiwanese/Japanese/SK goods in the shops in USA , but it is not proving that the USA is dependent on any of the Chinese suppliers.

I disagree with logic regarding of this, due to the next:
1. The Chinese goods replaced other countries goods from market.If you check the historic Japan/China trade then they fight for the same market
2. There are countless of country running trade surplus, and many country desire to do this. But if you check the trade deficit countries then there is only one running big enough : USA.


The necessity and sufficient condition to keep China the same level of export WITHOUT usa is to have another country willing AND capable to run trade deficit.

Any candidate?

And now the other sides of the trade balance is the required workforce to supply the market with goods.

The deficit country import unemployment ,the surplus importing employment.

Your reasoning can be true only if there is no other country around the word that is willing to run trade surplus.

But the reality is that there is no country on the word that willing to run trade deficit - apart from USA and UK.

 

[AndrewS]

That is another proof for that certain imbalances are built into the country, and no infrastructure investment can solve them.

The EU market is not fragmented any more.

The language barriers are less problematic than it should to an outsider, even before the EU it was a requirement for the majority of office jobs to talk at least one another language,

If I go around any shop in any European country then I see good from all over EU.


So, the marekt integration is very deep, regards of goods/services /work flow inside the EU.

Only thing is missing the central government, to iron out the imbalances.



All of them ride the export as engine of growth, but China is too big to follow that route.

They still depending the US export as the main growth source.

I just have to check any USA shop for the proof of it.

Yes, there are imbalances due to geography. But look at how those differences have been ironed out in the USA which has a way more integrated market than the EU.

You have to be kidding me about EU fragmentation. When you look at a true single market (like in the USA), it is way more efficient than what we see with the European Union.
Every time I try to buy stuff from different countries, I just see so many major websites only setup in one language, and which only deliver to one country.

Your comment on language not being a barrier makes no sense.

There are 6 major languages in Europe with more than 40million native speakers (English, French, German, Italian, Spanish, Polish). So how many people actually can even speak 2 languages fluently?

Note that the Italians, Spanish the French are notorious for not speaking other languages.
Remember that the majority of people in every EU country are not university educated, so realistically they are not fluent in even 2 languages.

There has been a huge backlash in Northern Europe against migrants from Eastern European and South European migrants, who struggle to speak the local languages. If there is an efficient market, then there shouldn't be this sort of anti-foreigner backlash against their fellow Europeans,

If there was a truly integrated EU market, we would see US levels of income differences across the states, rather than the huge gaps in the EU.

And the creation of truly pan-European companies, which we simply do not see. For example, in a single market, it makes no sense why France, UK, Germany, Netherlands, etc each have their own national supermarket/retail chains that dominate each country

However, these countries are all densely populated and right next to each other. These fragmented companies are simply less efficient than if a single Wal-Mart type company existed. But that doesn't exist and likely won't ever happen.

You should know that I've lived in Europe my whole life and travel all the time. And whilst I appreciate the quirks of what makes each place different, I also see how fragmented and divided it is when I compare to experiences in the USA/China.

 

[Hendrik_2000]

The profile of overseas Chinese role in China development There are many like him maybe thousands via Taishang

Chinese miracle beckons for Filipino 'snacks king'

Updated: 2018-09-28 06:42

(HK Edition)


China's economic reform and opening-up has turned entrepreneur Carlos Chan's Liwayway Group into one of the country's largest and trusted foreign corporations. Willa Wu reports.

The Oishi Shanghaojia brand is one of the most widely-respected and recognized brands in China - a remarkable success story of how the country's economic reform and opening-up policy has pulled in foreign investment.

The company, renowned for its snack foods, is a part of the Chinese miracle - brought here by Carlos Chan, a Chinese Filipino, who is today ranked No 21 on the Forbes list of the Philippines' 50 wealthiest individuals. The tycoon shared the secrets of his success with China Daily.

Chan set up Oishi's first overseas plant in Pudong, Shanghai, in 1993, in cooperation with two State-owned companies. He gave his brand the Chinese name - Shanghaojia, which literally means "excellent, top grade and high quality".

The auspicious name didn't bring much luck to Chan at the beginning. He had to wait for nearly half a year for the plant's operating license to get the nod.

Then, no sooner had the plant opened when it looked like his fledgling enterprise was bound for disaster.

Chan got a phone call from the manager of his newly-established Oishi plant in Shanghai.

"I'm afraid we have to leave the China market," Chan recalled his plant manager telling him. "The employees here won't cooperate with us."

Chan answered: "I will come and talk to them." He had already learned valuable lessons, working shoulder by shoulder with his father in the family business - "be patient" and "make friends before doing business".

The entrepreneur recalled the tense atmosphere as he walked into the meeting with the plant's Chinese workers. "They were all standing, red-faced. I wasn't allowed to sit either." Chan stood for almost an hour listening to his employees' complaints.

The workers had been hired from two State-owned companies that had leased the factory to the Filipino group.

"They were dissatisfied with the management. We were foreign employers. They thought we were capitalists, intending to exploit them. It was an ideological issue," Chan said.

Talking slowly, Chan described himself as "a shy man", something he had to overcome to follow his father's advice to be patient: "That to me, means having an attentive ear and talking to people regardless of their background."

Chan heard the workers' complaints and answered them. Tensions eased. Chan was invited to sit down. The Chinese Filipino employers and their Chinese workers started calmly discussing how to build mutual trust.

Chan ordered annual increases in their salaries. The workers had been earning only 200 yuan ($29) per month in the first place. He installed heaters in the staff canteen. "We needed to let them know we cared about them and not treat them like mere laborers."

Chan's communicative management style has imprinted his corporation. "We've maintained good relationships from top management down to frontline workers. Every decision is made after we put everything on the table to discuss," said Desmond Cheng, the plant manager of the corporation based in Cavite City, Philippines.

Chan's style won him loyalty from his staff and business partners. Cheng joined the company in 1996 and has worked for the group ever since. In his eyes, Chan is a "good and down-to-earth boss" who is always ready to talk to employees and willing to help whenever they need it.

According to Cheng, many of the employees with Chan's Liwayway Group of Companies in the Philippines are like him, having worked with the group for more than 20 years. "They view the company as their family, willing to build their entire career here," Cheng said.

It was 1994 when Oishi's Shanghai plant produced its first lot of prawn crackers. Chan recalled the trucks waiting outside the plant to deliver the crackers to distributors across China. "We faced little competition in China. We managed to cover the initial cost in the third year after we entered the Chinese market. Demand exceeded supply," Chan noted.

There's also loyalty among Liwayway's dealers in China. Many of the 700 wholesale distributors have maintained partnerships since the group entered China in the early 1990s.

"I often told my dealers that without Deng Xiaoping, Oishi would not have what it has today," Chan said.

Thus, the reform and opening-up policy became the catalyst, helping to create one of China's largest and trusted corporations.

Deng, the architect of modern China, put forward the reform and opening-up policy in 1978, allowing the once reserved country to open its doors to foreign investment. The policy has lifted around 700 million people out of poverty and has been the driving force behind the Chinese economic miracle.

Eight years after Oishi Shanghaojia was nearly forced to close, it became the first non-Chinese company to win the Shanghai Famous Brand Award. It's an honor given to brands ranked among the top five in their respective industries, and which have earned broad consumer trust. In 2006, Oishi Shanghaojia won the additional honor of being recognized as a "China Famous Brand".

Today, Oishi Shanghaojia snacks can be found everywhere, in small convenience shops or large supermarkets all over China. The company, now in its 25th year in China, has 15 plants across the country. The company's products are distributed throughout the country by over 700 wholesale distributors.

Data from Liwayway show that, currently, Oishi's market share accounts for 26 percent among similar products in China.

Oishi's success story began in the Philippines in 1946 when Chan was only 5. His parents, immigrants from South China's Fujian province, founded Liwayway Marketing Corporation in Manila, the capital city of the Philippines.

The company started out repackaging products like coffee and starch. It then began manufacturing products for the local snacks market. In the 1970s, the company started producing Oishi Prawn Crackers, making it a market leader in the local industry.

The family had held on to its Chinese roots. Chan was raised in a traditional Chinese family setting heavily immersed in Confucianism. The idea of contributing to the land of his ancestors was planted deep.

Chan attended Chinese schools in the Philippines. He is proficient in spoken and written Chinese and even gave himself a Chinese name, Shi Gong Qi.

 

[Hendrik_2000]

(cont)
Chan had dreamed of becoming a painter. He was majoring in architecture in college but, as the eldest son, he dropped out to help out with the family's growing business.

Chan got his entre to Shanghai through the movies he watched when he was a kid. In those movies, he saw it as a lively, vibrant place - a place that would be ideal for business.

He'd been considering entering the China market since the mid-1980s. Ten years after the company produced its first bag of Oishi prawn crackers, it was facing increasing competition from local rivals. He got little encouragement from people who knew the market, or thought they did.

"Many told me it would be hard to profit from the China market. People there were poor," Chan said. "So you mean they don't have one or two yuan at all?, I asked people who turned the stoplight on my go-to-China proposal," Chan said.

He wasn't willing to give up and decided to see for himself. He was determined to crack the Chinese market. In the late 1980s, he started making frequent visits to Shanghai. There was no direct flight from Manila to Shanghai. He had to change planes in Hong Kong and often enough, he was the only passenger in business class.

Chan's first direct experience of Shanghai proved a disappointment to him.

"It was under-developed. Roads were shabby and people all wore the same color - blue," the magnate said. But he hung on and learned about the local market and the country's legal system.

Recalling his initial days in Shanghai, Chan said one of his most memorable moments was the time he drove his Mercedes-Benz in Shanghai shortly after he opened the plant.

"There were few cars on the road at that time, let alone a luxury car. You could feel the people's eyes all fixed on you.

"But now things are different. I watch others' cars on the road in Shanghai. The city has advanced a lot."

Shanghai, where Chan's business empire in China started, became the first city in the country to post a 3-trillion yuan ($469 billion) GDP in 2017, and is on its way to becoming one of the world's major financial centers by 2020.

With its successful experience in China, Liwayway expanded its snack business to other markets, including Myanmar, Thailand, Indonesia, Cambodia, India and South Africa.

"My roots are in China," Chan said. "The Philippines is my home too. It has accommodated my family and given opportunities for us to thrive."

The mogul's love for both countries propels him to act as a bridge between China and the Philippines. Three Philippine presidents, including incumbent leader Rodrigo Duterte, have named Chan as a special envoy to China.

Talking about that role, Chan said his main task is to bring the two countries closer together. He has initiated many sisterhood pacts between provinces and cities of the two countries, including Bohol in the Philippines and Jiangxi province in China, Cavite in the Philippines and Anhui province in China, and Palawan in the Philippines and Ningxia Hui autonomous region in China.

After the deadly magnitude 8 earthquake struck southwest China's Sichuan province in May 2008, Chan donated 13 million yuan ($2 million), including 1 million yuan worth of Oishi products, to the affected areas.

He also paid for 100 high school students from the devastated areas to go to the Philippines to help them recover.

"I believe when someone dies, he or she, standing in front of God, will inevitably be asked: What have you done in your life?

"I think I've prepared myself for that question. Life is short. Live it not only for yourself, but also for society when you're able."

Chan now spends half the year in Manila and the other half in Shanghai. He is a man of few words, but plenty of action. At the age of 77 and having seven grandchildren, he's still energetic when it comes to expanding Liwayway's market map. That way, the billionaire is satisfied that he's not wasting time.

Contact the writer at

[email protected]

 

[Jura The idiot]

yes yes, I read
Xinhua Headlines: Chinese economy powering ahead
Xinhua| 2018-10-01 17:41:54

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Despite external uncertainties, the Chinese economy continues to power ahead, at a slower but more sustainable pace, with increasing market opportunities for the rest of the world.

China's manufacturing purchasing managers' index (PMI) came in at 50.8 in September. The gauge of factory activity was down from 51.3 in August but has remained in the expansionary territory for 26 months in a row.

The slowdown, along with moderating fixed-asset investment and industrial profits, has caused concerns regarding China's economy.

Analysts, however, suggest the use of a long-term approach to feel the pulse of the economy, which is constantly growing due to four key factors -- economic fundamentals, growth outlook, resilience and policy incentives.

HEALTHY FUNDAMENTALS

Non-manufacturing PMI expanded at a faster pace, standing at 54.9 in September, up from 54.2 in August, according to the National Bureau of Statistics (NBS).

The PMI readings confirmed a message revealed by a slew of other indicators, that the economy has stayed on the track of steady progress with sound fundamentals.

Imports, a barometer of domestic demand, have been growing strongly, up 13.7 percent in the first eight months. Industrial output and retail sales both rose at a faster pace in August, though fixed-asset investment increases continued to slow.

In the first eight months, over 10 million urban jobs were created and the surveyed urban unemployment rate was kept at a relatively low level of around 5 percent.

Despite fluctuations of some indicators, NBS spokesperson Mao Shengyong said the economy had been generally stable with improving momentum for growth.

The gross domestic product (GDP) expanded 6.7 percent in the second quarter, above the government's annual target of around 6.5 percent. The growth has remained between 6.7 percent and 6.9 percent for 12 consecutive quarters, highlighting its economic resilience.

In the latest OECD Economic Outlook and Interim Economic Outlook, the organization maintained its forecast for China growth at 6.7 percent for 2018.

RESTRUCTURING PROCEEDS

China has been in a transition from investment and export-fueled development growth model to one that draws strength from innovation, consumption and service sector.

"The new drivers have played a key role in sustaining growth, adjusting the economic structure and expanding employment," Premier Li Keqiang said when addressing the opening plenary of the Summer Davos in northern port city of Tianjin.

Consumption has played a more prominent role in driving growth, contributing to 78.5 percent of economic expansion in the first half of the year. The proportion was up from 58.8 percent in 2017.

The service sector contributed 60.5 percent of the overall economic growth in H1, 23.8 percentage points higher than the secondary industry.

High-tech industries and equipment manufacturing, dubbed as new driving forces, are booming and attracting increasing investment, when growth of overall investment has been declining since the beginning of the year.

SUFFICIENT RESILIENCE, POTENTIAL

Untapped potential solidifies the country's economic resilience and development potentials, experts have said.

China boasts a workforce of 900 million, among whom 170 million have received higher education or training in professional skills, and more than 100 million are market players.

Chi Fulin, head of the China Institute for Reform and Development, expects consumption market to hit 50 trillion yuan (about 7.2 trillion U.S. dollars) by 2020.

Besides consumer goods, Nicholas Lardy, an economist with Peterson Institute for International Economics, said China's large and still growing middle class was spending a growing share of their rising income on education, health care, travel and other services.

"Urbanization is unlocking tremendous market demand and conducive to upgrading industries and boosting employment and investment," said Zhang Liqun, a researcher with the Development Research Center of the State Council, a government think tank.

Citing favorable factors including huge market demand, abundant and increasingly competent human resources, vibrant entrepreneurship and innovation activities, and a reserve of innovative measures and policy tools for macro regulation, Premier Li Keqiang said that "all this gives our economy sufficient resilience, potential and space for maneuver. We have the confidence, ability and means to cope with the current difficulties and challenges."

KEEP UP REFORM, OPENING-UP

China owes its success over the past decades to reform and opening-up, and has pledged further reforms to improve the business environment, and wider opening-up to share its growth dividends with the rest of the world.

The Belt and Road Initiative and the first China International Import Expo, scheduled for November, also demonstrate the country's determination to seek mutually beneficial cooperation with other countries.

Besides efforts to boost longer-term development, China also announced a host of pro-growth measures, including enhancing financial support for small businesses, cutting administrative red tape and further reducing taxes and fees, to offset the strain from external uncertainties.

The government has vowed to keep employment, the financial sector, foreign trade, foreign and domestic investments, and expectations stable.

Supply-side reform supported by monetary and fiscal measures will help keep China's growth on track, the Asian Development Bank said in a recent report.

 

[Anlsvrthng]

Yes, there are imbalances due to geography. But look at how those differences have been ironed out in the USA which has a way more integrated market than the EU.

You have to be kidding me about EU fragmentation. When you look at a true single market (like in the USA), it is way more efficient than what we see with the European Union.

I agree with your basic logic, but you miss the base / starting condition for EU.

Originally there was many wealthy, national state, now there is a less fragmented, more optimal 500 million market.

So, compared to a homogen country it is way off, but compared to the starting condition it is way better.

Apart from the complete lack of central government.

Maybe the EU needs the Habsburgs : )