Briefly…Top Ten Tweets (From Private Equity & Private Consumption to Fast Cities, Slow(er) Lending & Dumb Things
Our round-up of last week’s news, from our ChinaBlogTweets highlights, is below:
Comment: China is upping its overseas direct investment (ODI), with policy incentives and political pressure on companies. It is also playing catch-up in the auto sector, where it is taking the lead in market terms, but where foreign firms have dominated. China’s ODI is generally getting smarter too, as we noted here. Watch this space.
Comment: Stability for the stimulus? Expect a package of policy measures to ensure continued growth (of 8% plus), while taking care to manage bank lending and inflationary risk.
Comment: Dan Harris says: “China’s view on foreign investment has changed in the last year and this change has not been for the better” . We noted the changing trend back in 2007 in this post: China, and the Story of the Malicious Foreign Takeovers. So if you do it, better do it legal (that goes for visas too).
Comment: Despite the paper losses for CIC in Blackstone, rumour is that it is being used for strategic investment. Same for Europe? As noted above, Chinese ODI is getting smart, and is using many channels.
Comment: Shaun Rein writes about some of the mistakes that foreign firms (such as Apple with their low-selling iPhone) make in China. Big brands, transferred to China, do not always mean big success. Adapt to local preferences, make marketing culturally relevant, and be big!
Comment: Bank lending, at some RMB10 trillion this year, went through the roof. It helped fund the stimulus, but is also stoking asset bubbles, non-performing loans and inflationary pressure. It will come down in 2010, but will also continue to be a well-used policy lever.
Comment: Business outlook has been getting better, but concerns remain. Not least on bank lending and the sustainability of the stimulus.
Comment: The gradualist approach to currency remains in place. As does pressure for appreciation. Of course there is a complex back story to this, and the arguments are not all black and white.
Comment: ...am surprised that list of fast-growing cities does not include more relative unknowns. Different cities have different attractions, as we noted in this post.
Comment: China is trying to make the “3 horses” of the economy (investment, trade & consumption) run as more of a group. Consumption, especially private consumption, has a long way to go. Policies are in place to push long-term restructuring, but it will take time.
