Is China A 'Paper' Tiger?

[Steve]

I saw this piece on them. I am not sure if its speculation or fact. I'm under the impression the Chinese economy is doing great and growing by leaps and bounds. However, could an economic downturn do what happened to Japan?

 

Chinese Cook Books

 

Foreign Policy: Washington and the media are quick to parrot Beijing?s numbers showing ?miracle? economic growth. But can we trust its numbers any more than the miracle growth once credited to the Soviet Union?

 

Market reforms or not, Beijing is still a police state running a command economy. Yet we accept Chinese GDP reports of 9% growth uncritically while casting doubt on their reports on defense spending. Go figure.

Defense Secretary Donald Rumsfeld says Beijing is hiding military outlays, low-balling them so as not to draw suspicions about its territorial ambitions in the Taiwan Strait and elsewhere. (China?s stated goal is hegemony in Asia; it?s called the ?Island Chain Strategy,? and those islands include Taiwan and Japan.)

?Since no nation threatens China, one must wonder: Why this growing investment?? Rumsfeld said recently. ?Why these continuing large and expanding arms purchases??

So if Beijing?s defense numbers are bogus, why do we have any confidence in its economic numbers? They come from the same dubious source: the Chinese Communist Party. How do we know its economic ministry isn?t inflating growth numbers to attract more Western investment ? the lifeblood of China?s economy? We don?t. There?s no transparency ? only a Great Wall of propaganda.

This is no small issue. American investors are pumping billions into the Chinese economy on the promise of huge returns, a promise slickly sold by the powerful pro-China lobby in Washington. Beijing needs that hard cash flow to finance its growth, because its state-run banks are virtually bankrupt. (Meanwhile, its central bank is artificially undervaluing its currency to make its exports artificially cheap.)

Many China watchers are starting to doubt China is growing as fast as it claims. ?You can?t trust their GDP numbers. They?re at least 2% below what they advertise,? said Roger Robinson, vice chairman of the U.S.-China Economic and Security Review Commission. ?So when they say 9% growth, it?s really 7% or less.?

Other estimates set the growth even lower ? 6.2%, according to the University of Chicago, and 3.0%, according to the University of Pittsburgh.

Robinson says that without the cushion of foreign capital, China would implode even with 5%-6% growth. And what would it do without our huge industrial subsidy? As a communist state with few incentives for innovators, China has to counterfeit goods and steal technology through economic espionage. Right now China pirates 90% of its technology.

?Miracle? economy? More like a mirage, kept alive by U.S. trade, investment and boosterism.

By naively buying into Chinese propaganda about miracle growth, we may be only propping up a corrupt communist regime while bankrolling its hegemonic military ambitions. We mustn?t forget that any market reforms are merely a means to that end.

[check_bin_krap]

When everthing you buy in low market stuff is Chinese its a good guess that they do well. They don't have any competitors worthy to mention.

 

Paid analysors and research reports? Shit, not worth a dime. Useless farts, overrated and would serve better in rice fields. Hope I offended some posters now,

 

And Rumsfeld - thats a guy to quote when it comes to good info - NOT

 

Cheers!

[David_66_UK]

?Since no nation threatens China, one must wonder: Why this growing investment?? Rumsfeld said recently. ?Why these continuing large and expanding arms purchases??

 

Heard his comments recently, was glad to hear he has not lost his sense of humour

 

Interesting article, China will be an interesting place over the next 20 years, can't believe that it will all go as smoothly as foreign investors are betting on - history and human nature being what it is.

 

I remember a quote from a TV Documentary a year or two back - some senior Chinese official was commenting on Europe worrying about what would happen after all the Good / skilled jobs were "exported" to China.

 

He said that China was also worried about what would happen after this...........as they would still need to find something for the other 300 million odd Chinese to do ::

[Shit-Spattered Dog]

David66UK said:

?Since no nation threatens China, one must wonder: Why this growing investment?? Rumsfeld said recently. ?Why these continuing large and expanding arms purchases??

 

Heard his comments recently, was glad to hear he has not lost his sense of humour

 

Interesting article, China will be an interesting place over the next 20 years, can't believe that it will all go as smoothly as foreign investors are betting on - history and human nature being what it is.

 

I remember a quote from a TV Documentary a year or two back - some senior Chinese official was commenting on Europe worrying about what would happen after all the Good / skilled jobs were "exported" to China.

 

He said that China was also worried about what would happen after this...........as they would still need to find something for the other 300 million odd Chinese to do ::

 

The article is quite wordy. Lots of big talk about grand ambitious about the Chinese's motives. Well the REAL answer is very simple: 2008.

This is the year of the Olympics in Bejing( aka Peking. I think they got the timing right. The west , with it high taxes, wages, stupided goverments, are shooting themselves in the foot. The Chineses, recognizing this and that the fact their country is falling behind has come up with this modernation ideal with the 08' Olympics as the crowning jewel. Just wait. After 2008 you will see China falling from it's peak. As a parallel, remember the 1960's US space program to put a man on the moon by the end of the decade. But after a few return trips the program mostly crashed back to earth.

 

Still it left a lot of spin-off effects. Think micro processors or intergrated circuits or space age glue and Carbon Composites.

The China spinoff will springboard it's country into one of the top nations on earth. ( It's all that cheap labour.

 

Why, the workers from Walmart could be considered to be a red neck labour union compared to workers and their rights under Chinese standard..This place is a manufacture's dream factory. Cheap labour, goverment hands outs, etc.etc.

 

Shit.

[Old Hippie]

In an economy totally regulated by the government, how can anything go wrong...? No Labor unions, no inflation, no problems right...? :dunno:

[samak]

it is often overlooked that fast economic development in china is limited to 3 regions: Greater Shanghai area, Guangdong Province and Beijing-Tianjin; few larger cities outside (Dalian, Wuhan, Qingdao, Chongqing) try to cope; the large majority of china (provinces and people) are poor and agrarian as ever.

GDP of China with over a billion people is still behind all leading europan countries like germany, UK, France with each less than 100 million people.

China is certainly a world superpower in manufacturing in certain industries like consumer electronics, computer and peripherals, mobile phones, toys, textiles etc.

but there is still a long way for them to become e world economic superpower! and certainly development will not be always as smooth as it was during recent 10-15 years.

[OCgringo]

China will always be a big question with the communist leaders it has,

 

Right now it looks good for business , but that can change any time , no real laws ,

China has lots of problems with the regions away from the action, will they just go along with the central government ? no one knows but history would say not.

 

Walmart might have more to do with China's stability than anyone

[Guest]

There was a recent article that pointed out that whereas this probably IS the Asian century, it will bedominated by India, that China's just a flash-in-the-pan. India's got the English langhuage skills. Got the education and literacy. Already lots of outsourcing. China's a hollow shell waiting to collapse. Or so the story went. More to it than that, but you get the idea.

 

China's just a pussy.

[Coss]

Well all this presupposes that the Chinese care about how they interact with the rest of the world's economies. A very (very) wealthy chinese fellow I know opines that they don't care at all.

 

Cheers

 

Coss

[Steve]

Would the 'have nots' in the poor provinces away form the action get a little ansy about their lack of success? One would assume the government will pump some money into these regions, keepinging in line with their communist ideology as well as an insurance policy against any uprisings.

 

There is an undercurrent of 'concern' amongst the government here regarding China's growing economic strength (justifiably or not, its the sentiment). Are there any such concerns in Europe regarding China?