• Could there be potential benefits to a hard landing of China's economy?

    China's Potential Economic Credibility Hit

    The sudden, sharp fall of Chinese stock prices twice in 2015 and again this month does not necessarily herald a further slowdown of GDP growth. However, investor confidence, the bedrock of a healthy economy, has been shaken both in China and throughout the world.

    As Chinese leaders struggle to implement market-based reforms, a severe economic crisis that causes social disruption cannot be completely ruled out. In such a case, what might happen?

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  • Guangdong is really where China's economic transformation is originating.

    Look to Guandong for China's Transformation

    China’s southern province, Guangdong, is emerging as a globally important innovation zone and consumer market. It moves into the future as it builds a post-industrial society.

    The forces that once boosted Guangdong’s dramatic economic boom – industrialization, booming world trade, cheap labor and low-cost manufacturing – are fading. With the slowest growth pace in 25 years, economic anxiety is spreading. That standard narrative is part of the story, but not the full story.

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  • Critics suggest China's anti-corruption measures are hurting the economy.

    China Casts a Wider Anti-Corruption Net

    As China’s anti-corruption drive is expanding from the public and corporate sector to financial institutions, some argue that it is hurting economic growth. In reality, it is the rule of law that can ensure China’s resilient growth.

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  • Several factors are conspiring to slow China's economic engine.

    Chinese Economy Likely to Decelerate Further in the Fourth Quarter, Albeit Moderately

    China grew at 7% year-on-year in the first and the second quarter and 6.9% year-on-year in the third quarter of 2015.  This is its weakest quarterly economic performance since first quarter of 2009 according to official data, growth is likely to decelerate further - albeit moderately - in the fourth quarter (i.e. GDP growth will probably be a bit lower than 6.9% year-on-year in the fourth quarter).  Consequently, annual GDP growth will be lower than the official target of 7% in 2015.

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  • China promotes global investment, but punishes 'Western values'.

    China Straddles Menacing Superpower and Economic Saviour

    The Janus-faced nature of Xi Jinping’s China was again on show in 2015. In September, a dour-looking Xi reviewed soldiers and ballistic missiles at a military parade in Beijing to celebrate the 70th anniversary of Victory Day, which marks China’s victory over Japanese aggression in World War II. A month later, a grinning Xi rode beside Queen Elizabeth in the royal carriage as Prime Minister David Cameron talked up Chinese investment in the United Kingdom.

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  • China sharpens its focus on Africa.

    China's Global Leadership Litmus Test

    The sixth Forum on China–Africa Cooperation (FOCAC), held on 4–5 December 2015, set in motion a deeper pattern of exchanges with its partners that could drive economic transformation across the continent. In ‘scaling-up’ measures to ease African bottlenecks in infrastructure, skills and finance, China’s efforts are also a litmus test of its legitimacy in global leadership.

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  • China's e-commerce future is in full effect.

    China's Wuzhen Summit (World Internet Conference) is on Deck

    The second World Internet Conference (WIC), also known as the Wuzhen Summit, will take place Dec 16 -18, in Wuzhen, Zhejiang. Chinese President Xi Jinping will attend the conference and address the opening ceremony. It takes place amid dramatic expansion of Chinese e-commerce, thanks to great market potential and government's supportive policies.

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  • China understands the dollar-yuan link and will act accordingly.

    China's Yuan Tactics Seem to Take Cues from the Fed

    The US dollar continues its mixed performance.  The fragile stability of commodity prices today is not lending much support to the Australian and New Zealand dollars though the Canadian dollar is flat after yesterday's slide.

    The euro has pushed above $1.09 for the first time this week.  We had suggested a $1.08-$1.10 range would likely dominate this week.  Technically, it appears poised to test the upper end of that range.  Stops above the $1.1010 retracement objective could carry the euro toward $1.11.

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  • China should embrace its migrants contribution to the new consumption economy.

    China's Migrants Show Great Economic Potential

    China’s economy has entered a ‘new normal’, slower growth pattern. In addition, consumption is touted to play a more significant role in boosting economic development. The potential is large. However, if it has to be achieved, the Chinese government needs to focus on unlocking the consumption potential of migrant workers who are a major driver of structural change and urbanisation in the Chinese economy.

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