Tag Archives: Communist Party of China

That Incredible Shrinking Feeling: #Chinese Regiopolis ‘Experiencing Biological Leakage’!

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Filed under Environment, Urban Life

Great Firewall, 2.0: World’s Most Sophisticated Redacting Network ‘Gets Legislative Framework Upgrade’!

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China’s Growing Realisation: 7%/Year Economic Expansion ‘the Stuff of Dreams’!

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Filed under Economic Development, Economics, Political Science, Politics

The #Gaokao, But Not As We Know It: China Unveils ‘Total Revamp’ of #Education System!

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Apartment Life 2.0: Map of China ‘Altering Beyond Recognition’ as Villages Obliterated!

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The Fifth Chinese Revolution: The March Up the Value Chain!

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The New Great Wall of China: Economic Growth?

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One of the more intriguing executive summaries that our Creative Director & CSO has come across in recent times is that to the Asian Development Bank’s visionary book, Asia 2050: Realizing the Asian Century (‘ADB Asia 2050’). ADB Asia 2050 projects that by 2050, an additional 3 billion Asians could be enjoying levels of affluence comparable to those present in (Western) Europe in 2011. However, this possibility – which would make the ‘Asian Century’ something of a foregone conclusion – is, as ADB Asia 2050 notes, not preordained. Rising inequality, climate change and weak institutional capacity are but three major challenges that the world’s most populous continent must transcend in order to attain this objective.

The prosperity of large parts of Asia will also depend to a large degree on the health of the Chinese economy – and it is here where there is perhaps most cause for immediate concern (narrowly defined). Official, recently-released data claims that the PRC’s economy grew at a rate of 7.8% year-on-year for Q4 2013. This might not ordinarily be too troubling: after all, this rate is something that most European and indeed American economies can only dream of. However, on closer inspection, this level of economic performance should be causing a certain amount of panic in the streets – at least amongst economists and administrators.

As a one-party authoritarian state, China is not subject to many of the normal rules that more open countries are subject to. This means that it can do almost anything it likes in an attempt to elevate GDP figures, way beyond even the undoubted and clearly evident irrationality of many Western governments. As the respected analyst Tyler Durden has pointed out, China can expand balance sheets at a velocity that would make the most fervent Keynesian blush. The Chinese state can level 700 mountains to build a city with an official population of 100,000 and inhabited by virtually nobody. It can throw up the world’s largest shopping mall by gross leasable area – the New South China Mall on the outskirts of Dongguan – and leave operational with a vacancy rate of 99%.

All of these measures work wonders for augmenting short-term GDP. In the long term, they create the mother of all credit and property bubbles – and as economists everywhere should know by now, the larger the bubble, the more spectacular the burst. The comedown from this monetary sugar-high will be nauseous and could have many possible consequences, but delaying or perhaps even derailing the Asian Century is almost certainly one of them.

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