CHINA’S ECONOMY IN 2012 AND 2013

CHINA ECONOMY TO REBOUND IN 2013: AFP SURVEY

Kelly Olsen (AFP)

The China Post, January 14, 2013

BEIJING -- China's economy is poised finally to end a long downward trend in 2013, economists polled by AFP say, as the new communist leadership vows to retool the nation's investment-led development model and promote a “happy life” for all.

The world's second-largest economy is not expected to return to double-digit growth, but the economists' predictions are a welcome spot of good news in a financial world assailed by the eurozone debt crisis and lackluster recovery in the United States.

After seven consecutive quarters of slowing growth, China's gross domestic product (GDP) will rise by 8 percent in 2013, according to the median forecast of 15 economists surveyed by AFP. The poll also projected 7.7-percent growth for 2012.

The figures would outpace the government's 7.5-percent growth target for 2012 — but are well below the 9.3 percent recorded in 2011 and 10.4 percent in 2010.

Maintaining growth is all-important for China's communist leaders, who derive much of their claims to legitimacy from the country's reform-led economic rise, which has lifted hundreds of millions of people out of poverty over the past three decades.

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COAL IN INDONESIA

COAL’S SLIDE POSES BROADER RISKS FOR INDONESIA

Wayne Arnold

Reuters, September 11, 2012

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Coal’s slide poses a problem for Indonesia. As the biggest exporter of coal used for generating power, the country’s fortunes might seem directly tied to China and India’s economic slowdown. In fact, exports account for only a sliver of GDP. The bigger risk is that falling demand spooks foreign investors, undermines a provincial boom, and hurts poor workers.

It’s tempting to see coal as king in Southeast Asia’s largest economy. Indonesia exported 309 million metric tons of the stuff in 2011, according to the World Coal Association, making it the world’s largest exporter of the thermal coal that powers Chinese and Indian power. Slowing demand meant Indonesian coal exports fell 13 percent from May to June.

However, the link to Indonesia’s economic fortunes is not straightforward. Coal accounts for only about 14 percent of Indonesia’s exports and 4.4 percent of GDP. A 30 percent increase in foreign direct investment in the second quarter suggests the country’s growing population and rising incomes remain compelling.

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CHINA/INDIA: MILITARY

CHINA ON A PEACE OFFENSIVE

Manoj Joshi

India Today, September 6, 2012

China is making special effort to gear up its forces for high-altitude operations.

The Chinese are on a peace offensive now. In keeping with the precision with which they operate, the Chinese have sent three top military officers across the world to convey the message that China's actions in South Asia and the South China Sea should not be seen as threatening by anyone. It is quite another matter whether their interlocutors will receive the message that China wishes to convey. But you can't fault Beijing for not trying.

China's Defence Minister Liang Guanglie came on a four-day official visit to India on Sunday, at the head of a 23 member delegation. The delegation included Yang Jinshan, commander of the Tibet autonomous region's military district. This was the first visit by a Chinese defence minister since 2004, but Liang had visited India as chief of the general staff in 2005.

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COMMODITIES IN INDIA

EMERGING GLOBAL COMMODITY MARKET REFORMS, LESSONS FROM INDIA

B C Khatua

Commodity Online, November 7, 2011

The global financial markets have been literally in a churn since early 2008,which became more pronounced after the collapse of Lehman Brothers. Apart from the housing bubble and bankruptcies caused by excessive speculative investments by investment banks in high-risk, complex structured products, the role of excessive speculation in select commodities by high return seeking fund houses, viz., Hedge Funds, Private Equity Funds, long-only funds etc in causing this crisis, first in US and then in the whole global economy, has been well chronicled over the last 3 years.

The massive public funds spent by the US and other governments to bail out these entities in crisis may have saved them, but the aftermath of the crisis persists in terms of high rates of unemployment , persistent high inflation in many economics including India, high interest rates to combat inflation resulting in slow economic recovery and slowing of the GDP growths. The debt crisis in European Countries , viz., Greece, Spain, Ire Land, Portugal, Italy etc. has cast a heavy shadow on the global sentiments apart from plunging the Eurozone into a tailspin. Stock markets are crashing and commodities are plunging. That the food prices in India buck the trend and are causing sleepless nights to the government and the poor alike is another paradox which needs another article to explain.

The touching faith of the likes of Mr. Alan Greenspan, in the ability of the markets to self-regulate in the midst of the scorching growth of the financial markets in the 1990s and early years of the 21st century, lies shattered. The proof of limitlessness of human greed ( in the form of investment bankers and high return seeking HNIs) has been laid bare once again. The efforts of the US Government to rein them in have not shown any significant change in their attitude or behavior, thanks to the easing of the crisis and their leverage in influencing the political legislative process and lobbying ability. The "occupy wall street " movement of those adversely effected by the crisis is a manifest reaction to this phenomenon.

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CHINA AND COMMODITIES

CHINA’S ECONOMIC GROWTH STOKES COMMODITY BULLS AS RISKS GROW

Clyde Russell

Gulf Times, July 18, 2011

China’s stellar second-quarter economic growth should come with a health warning similar to investment products: past performance isn’t an indicator of future returns.

The commodity bulls will have been stoked by the 9.5% growth in gross domestic product in the three months to June.

Not only did it beat expectations of 9.4%, the details were positive, showing a 15.1% rise in factory output and record steel production.

Certainly, the case for a soft landing for the world’s fastest-growing major economy is still very much in place.

In such a scenario, demand for key commodities, such as crude oil, copper, iron ore and coal should remain robust, supporting higher prices in the second half of the year.

Investors responded to the China data by boosting the prices of metals, shares and the Australian dollar, a key risk-barometer currency.

But – and this is a fairly big but – the happy story presented by China may be adversely affected by developments half way across the world.

The debt crisis in Europe just seems to get worse and it now appears likely there will be a default of some sort on Greek debt, with heightened risks of something similar in Ireland, Italy and Spain.

(...) [artículo aquí]