(On January 5, 2012, I sat down with Shaun Rein, founder and Managing Director of the China Market Research Group, to talk about China. He gave us his insights into major events of 2011. You may listen to the podcast or read the transcript below. Click on the play button or right-click on the link to save the podcast for local listening: link. In this hour-long interview, we touched on many topics: pollution, CNN and Christian Bale’s recent run-in with Chinese police, food safety, Weibo, and so on.)
DeWang:2011 was another eventful year for China. Just when her bullet train seems unstoppable, a fatal collision left the whole country in doubt. China achieved space docking, something only the U.S. and Russia have managed. Then there was Tiger Mom.
I have invited a real China expert to weigh in on these events and other events that mattered to China. What were the Chinese narratives? How did the Chinese feel about them? I couldn’t have found a better person to do this with. Read more…
With Obama meeting other East Asian countries in Hawaii these few days, the “American re-engagement with Asia” story is all of a sudden in vogue again. This new way of thinking actually started with President Obama’s promise couple of years ago to double America’s exports in the not too distant future. The goal itself is worthy and is an excellent way to channel America’s energy. Unfortunately, the simple gist of that U.S. ‘re-engagement’ has instead been couched by the U.S. media into some sort of militaristic furtherance, with a suspicious eye casted at China. Such ploy is to dramatize and sell ads (and, sure, by politicians to garner votes). I am happy that the Obama administration still publicly reaffirms the idea that a richer China bodes well for American exporters, because that is the simple truth. Ask Intel, Apple, GM, and Caterpillar. Read more…
Here’s one aspect of China’s manufacturing capacity that is rarely mentioned in mainstream western press. By restricting export to China, the US government is giving the largest manufacturing markets to its main competitors. The US hope that by restricting hi-tech export would prevent China from developing its own hi-tech industry. However, the reality is that companies from Germany, Japan, France and Taiwan etc are the major winners. As of now mainland and Taiwan companies accounted for 55% of the world market in Five-axis CNC machine. Technology is not a stagnant and exclusive national attribute, any country who aspire to it and willing to work hard and invest in it will develop it. There is just no exception to the rule.
Americans, of course! Various entities within the U.S. own $9.8 trillion and the remainder $4.5 trillion are owned by foreigners and foreign governments. My own tally shows China, Hong Kong, and Taiwan combined for about $1.4 trillion, about $500 billion more than Japan. These data come from Business Insider and make for great reference since America is undergoing debates about raising the debt ceiling. Top holders of U.S. debt are listed below: Read more…
Most people probably don’t know him but I believe he is one of the most influential people from Taiwan. Here is a World Policy Institute interview of Justin Yifu Lin, the current Senior Vice President of World Bank. He was appointed on 2008. On another note Zhu Min was appointed deputy managing director at IMF.Read more…
Some might wonder how is it possible that Google still commands about 15-20% search market share in China despite its google.cn service essentially shut down there. The reason is because many Chinese netizens, 450 million and growing, are still using google.com for English language searches. Actually, according to Analysys International, a Beijing market research firm, Google enjoys 19.2% in revenue share in China versus Baidu’s 75.8%. For this reason, Baidu and Microsoft have just announced combining efforts to take on Google on that market segment. Read more…
Below is a two-part series made by Aaron Hawkins. I came across his channel on Youtube because he recently talked about the China, South Korea, and Japan efforts in looking into bypassing the USD in their trilateral trade. It appears he has built a small but steady following. Hawkins believes America will collapse economically when the dollar loses the “petrodollar” status and is a matter of when, not whether. He then imagines what happens next. Please watch the two videos in sequence and then cast your vote on this simple poll. (Click ‘Read more..” to expand the post and the videos will show.)
By 2020, China’s FTA with ASEAN nations will get another big boost; a 3,900km high-speed railway system linking China’s Kunming through Laos, Thailand, and Malaysia down to Singapore becomes operational and construction has already started. See my hand-drawing in the regional map below to get a sense of scope of this project. China’s trade with the ASEAN countries has sky-rocked to $292.78 billion in 2010, the year the FTA went into effect. ASEAN countries exports to China at $154.56 billion already dwarfed the U.S.’. Read more…
Following is Russia Today interviewing Economist Max Fraad Wolff, from The New School in New York, supporting an IMF report saying China’s economy will overtake that of the United States in five years on a purchasing-power parity (PPP) basis. This report has stirred up a new wave of discussions around the globe. I liked Wolff’s overall take on this issue, and I would like to chime in with some thoughts of my own. Please watch the footage below before continuing with this post.
One of my favorite columnists for China Daily is Zhang Monan. She has a crisp picture of our world’s financial system. Her recent Op-Ed, “Rebalancing global economy,” lays out for us the benefits enjoyed by the U.S. for having the USD dominating the international monetary system. Precisely because the U.S. is diluting the value of the USD at the rest of the world’s expense, China, Russia, Europe, and generally rest of the world are now pushing for a multi-currency based system through G20. Read more…
The Bahamas has been hit hard by the financial crisis in developed countries and the resultant dwindling tourism. Back in July of 2010, China Daily reported two agencies approved for financing the Baha Mar resort in the Bahamas, enabling much needed job creation. The resort is the largest of its kind in the Caribbean. In this report, construction officially started few days ago. The resort is slated to open in late 2014. Chinese Ambassador Hu Dingxian said to Bahamians during the ground break ceremony, “China is committed to an economic relationship of cooperation and mutual benefit.” Read more…
Even though the 2010 Shanghai World Expo has long passed, I thought this Russia Today coverage of Russian President Dmitry Medvedev’s visit was interesting. It gave a glimpse into the economic relationship between Russia and China as viewed from the Russians.
Henan Province farmers setting up irrigation system
Should China levy environmental tax on exports? Before offering my thoughts on that question, I’d like to share some news first.
China has announced spending 4 trillion yuan ($601 billion) over the next decade in water projects, mainly to tackle over-exploitation, usage efficiency, and pollution. The country plans to cap water consumption at 670 billion cubic meters, and according to this other recent report, China is now short about 40 billion cubic meters annually.
China’s Ministry of Water Resources also reported severe droughts this year, especially in Shandong, Hebei, Henan, Anhui, Shanxi and Jiangsu provinces. It said that in Hebei Province alone, 370,000 residents are having difficulty getting drinking water due to abnormal rainfall (80% less than normal). Read more…
Russia Today’s Producer has a very thought-provoking take on the U.S.-China relations. It goes something like this. The true division is among the American elites. On one hand, the military industrial complex wants a fearsome and bogeyman China. On the other, “normal” industrial capitalists wanting more business for their constituents. “Human rights”, “intellectual property”, etc are perhaps “hot air.” “Congress attack on China?” Probably that too.
I was really moved by the following images, from Hunan Province’s Chaping township where the region is hit by a severe cold storm. The images appeared today in China Daily, entitled, “Pupils take up books, pens, and hand-stoves.”
Occasionally I sift through photos taken by friends who had recently been to China. This is a portrait of Mr. Zhang taken by my friend Ming while in Shanghai. (The same friend whose Tiananmen photo I used in a previous post.) In his words, this is the story behind the image: Read more…
Chinese scientists made breakthrough at the No.404 Factory of China National Nuclear Corp in the Gobi desert in remote Gansu province, enabling the re-use of spent uranium and increasing the efficiency of nuclear fuel by 60 folds. China’s existing supply of uranium throughout China was estimated to last for 70 years. With this technology, China now forecasts the supply lasting 3,000 years.
This breakthrough obviously makes nuclear power a much more practical option, because the waste resulting from use is now dramatically reduced. Read more…
Here is Warren Buffett talking to CNN Money about two months ago. I feel his basic message to the American people is right. I think he tried to stay away from the politics and offer a fairly optimistic view of the China-U.S. relationship. Quite a bit of ground covered in that short segment, actually. If one of my American friends ask me, I will provide basically the same nutshell. (There might be an obligatory 30 second commercial before Buffet appears.)
Russian President Vladimir Putin and Chinese Premier Wen Jiabao has just jointly announced in St. Petersburg to no longer use the U.S. dollar in their two country’s bilateral trade. China Daily reported the news, headlining, “China, Russia quit dollar.” This is a reaction to the yet another round of printing by the Fed ($600 billion in fact).
“Quantitative easing” are new fancy words the U.S. government use to describe printing money out of thin air. (Would you be surprised if the U.S. media do not refer to this as “currency manipulation”?) At the recent G20 Summit, world leaders were upset at the U.S. for being so irresponsible as the USD is the reserve currency for the world. If Russia and China successfully execute on this arrangement in the coming years, I think other countries could follow suit.
In my prior post, “The 2010 USCC Annual Report is ‘truthless, prejudicial’,” I ranted about the 2010 USCC Annual Report and reiterated Chinese Foreign Ministry call that the report was “truthless” and “prejudicial.” Some of you expressed privately that I should address the report seriously, especially, as this is an “official” position taken by a branch of the U.S. government.
Some of you also responded, since the U.S. is not interested in addressing the systemic problems locally and rather blame foreigners (China especially in this report), then let the U.S. march forward with her madness. In the long run, it will only result in America’s decline. Let it be, so the argument goes.
After giving it some thought, I think China and the rest of the world have a vested interest in America seeing our world for what it is, not to be cloaked in lies and prejudices. Read more…
Recently, the U.S.-China Economic and Security Review Commission (USCC) released their “2010 Annual Report” (complete in PDF) to the U.S. Congress, criticizing China over many issues. The USCC’s purpose is as follows:
To monitor, investigate, and submit to congress an annual report on the national security implications of the bilateral trade and economic relationship between the United States and the People’s Republic of China, and to provide recommendations, where appropriate, to Congress for legislative and administrative action. Public Law 109-108 directs the Commission to focus its work and study on the following eight areas: proliferation practices, economic transfers, energy, U.S. capital markets, regional economic and security impacts, U.S.-China bilateral programs, WTO compliance, and the implications of restrictions on speech and access to information in the People’s Republic of China.
the Economist recently interviewed Michael Spence (Professor of Economics, Stern School of Business, New York University, and Senior Fellow, the Hoover Institution, Stanford University), and I thought his comments about China, the U.S., and the growth dynamics between the developing countries and the developed countries were rather interesting.
He talks about economics without the politics. It’s almost “weird” to find this type of discussion in America nowadays. He said that China is laying the ground work for transitioning into a more advanced economy over the next decade. He also said that the developing countries will maintain their growth even if the developed countries continue to limp along; the developing economies are no longer as dependent on the developed countries as was a decade ago. Elsewhere, I’ve read him articulating the U.S. has been consuming more than it produces for about a decade now and the U.S. will have to settle into a lower consumption “norm” when it re-emerges. Read more…
Six months ago, I wrote about the “COMAC C919, Challenging the Boeing and Airbus Duopoly.” The aircraft was scheduled for production release in 2016. And looks like the plan is proceeding well. The company has reported 100 of the planes having been pre-ordered by various airlines. So, here we are, six years before release, the C919 has already started making dents in this lucrative industry.
You may follow the above link to see who the suppliers are (for various subsystems of this aircraft) as well as other pertinent information about the market the C919 competes in. The C919 leverages COMAC’s experience from the ARJ21 which is expected to enter service this year.
Today, I am writing this post from Japan. I had a chance to speak with a Japanese colleague about the general financial crisis in the developed world, particularly as relates to Japan and the U.S.. In this post I simply would like to share that conversation.
It started out with him telling me the Japanese government is trying to take austerity measures to address the country’s budget deficit. This meant cutting back on government expenses. Europe is similarily embarking on such measures. Read more…
Kauai is one of the most beautiful places on planet earth. I have just returned from a one week vacation on the island with my family. The vacation has given me a chance to step away from blogging and put a pause on every day life. You might begin to wonder how this post is going to relate to China. While on Kauai, a number of thoughts did occur to me. Before getting into that, I’d first like to share with you the wonders of this incredible place.
(You may click on any images on this post for an enlarged view.)
Above is a traveler meditating to sunset at Poipu Beach at the southern coast of Kauai. It is easy to imagine why such landscape or seascape draw all sorts of inspiration; romance, artistry, and, apparently spirituality. By the way, the woman in the picture is really beautiful. A thought to interrupt her to get a portraiture did cross my mind, but I decided otherwise. Read more…
The government must make the use of public resources transparent by having all administrative expenditures included in the budget system and known to the public. (Wen Jiabao)
(On January 5, 2012, I sat down with Shaun Rein, founder and Managing Director of the China Market Research Group, to talk about China. He gave us his insights into major events of 2011. You may listen to the podcast or read the transcript below. Click on the play button or right-click on the link to save the podcast for local listening: link. In this hour-long interview, we touched on many topics: pollution, CNN and Christian Bale’s recent run-in with Chinese police, food safety, Weibo, and so on.)
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