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Hot off the press, here’s our new policy brief on economic rebalancing in China. The paper takes an updated look at the key policy reforms necessary to achieve economic rebalancing, sketches out a feasible rebalancing scenario over the next decade, and analyzes the domestic political challenges. As always, your public and private comments on this paper are [...]
With the release of fourth quarter 2012 economic data, we can give an update on the economic rebalancing in China. For an explanation of these indicators and why they are important, refer back to our original post on the topic. 1. Urban Disposable Income Growing Faster than GDP Urban disposable income continued to grow moderately faster than [...]
Michael Pettis’ new volume, The Great Rebalancing: Trade, Conflict, and the Perilous Road Ahead for the World Economy, is an important new take on the ramifications of global imbalances, in particular for China and the United States. The book sketches the familiar outlines of Chinese domestic and external imbalances, a sky-high investment share of GDP, [...]
The pace of Chinese intervention in the foreign exchange market has slowed dramatically, but just how much is a bit of an open question. The People’s Bank of China (PBoC) releases a monthly series on foreign exchange reserves. This number receives a lot of attention because it is high frequency and gives the overall stock [...]
Land reform is one of the most politically sensitive topics in China and it has direct implications for both the real estate market and local government finances. In late November the Chinese State Council passed a draft amendment to the Land Administration Law (CN). The changes are aimed at boosting compensation for farmers whose land [...]
One of the messages coming out of the new Chinese leadership is an emphasis on higher quality economic growth. This means moving past a simple emphasis on the headline GDP growth number and instead focusing on boosting living standards. This is embodied in the renewed emphasis on building a moderately well-off (小康) society and the [...]
China’s once-in-a-decade leadership transition has now occurred with the conclusion of the 18th Party Congress and speculation is running high as to what the future direction of economic reform will be. The new lineup of the Politburo Standing Committee is a mixed bag in terms of reform. Key reformers like Li Yuanchao and Wang Yang were left off, but protégés of [...]
We’ve followed the development of wealth management products (WMPs) with interest on this blog. These financial products act as alternative to deposits, soaking up funds from investors seeking to escape low interest rates on bank deposits. While many analysts have greeted the proliferation of WMPs as backdoor interest rate liberalization, we’ve been more skeptical. Source: CNBenefit A [...]
With the third quarter economic data now released, we can give you an update on the progress of economic rebalancing in China. For an explanation of these indicators and why they are important, refer back to our original post on the topic. 1. Disposable Income Growing Faster than GDP Disposable income continued to grow moderately faster than [...]
The third quarter GDP number for China was released today, showing a decline in growth to 7.4 percent (compared to 9.1 percent a year ago). Instead of a long post reiterating all the factors at play, sometimes a chart or two can sum things up succinctly. Here are the two most important graphs for understanding the [...]