A couple of days ago, I was invited to attend a talk by the chief economist of a leading bank in Australia at the Faculty of Economics and Business of the University of Melbourne. (The invite was actually extended to my son-in-law and as he could not make it had asked me to attend instead.) After the talk, a few of us were invited to join the dinner hosted by the university for the speaker.
The talk was on the
outlook of the economy of China and India. As expected, the speaker thought China’s
economy was about to decline, an outcome that is no different from what has
happened to Japan years ago. He put up impressive graphs to support his
contention – negative population growth, high youth unemployment, and more than
300% of debt as a percentage of GDP. He thinks that although China can achieve 5%
GDP growth this year, the rate is going to be downhill all the way to something
that is common to all developed countries, i.e., close to zero growth. He
thinks it is unlikely that China can replace the US as the largest economy in
the world.
On the other hand, he thinks India still has much in its tank. It should continue to do well for a long time.
The speaker is obviously a great fan of The Economist magazine. During the dinner, he sat two seats from me. And in between us was a lady professor at the university. I lost no time to patronise him. I told him he had not taken the culture part when he did his projections. He said he did not believe China’s story was a case of exceptionalism. I told him this should precisely be the term to describe China. I cited example after example to support my case. Since he agreed with me that Singapore’s leaders are great, I suggested he might like to read what Ong Ye Kung has just spoken about China – it is on way to become the largest economy in the world in 2030 in nominal terms. (It is already the largest in PPP terms.) One thing I have to take my hat off to him is that he did not seem to get offended by my opinion of this conclusion.
However, not so with the lady professor who sat between us. She seemed scornful about China all the while. Such attitudes are common amongst politicians in Australia, but I was surprised that a senior academic could behave that way. Just imagine, she said the century of humiliation suffered by China was made up by we Chinese. I could not help blurting out "What a load of rubbish!” to her. She must have been shocked by my outburst, albeit mine was done in a smiling manner. But how could a senior academic be so callous in her remark?
China produces about 12 million first level higher education qualifications, splitting roughly 50-50 between bachelor and non-degree professional certificates. It is still small relative to the size of the Chinese economy. The Chinese is rebalancing economy, thanks to the west’s decoupling and now de-risking policies in general and the US and its allies’ of their denial of China’s access to advanced chips and chips-making equipment in particular. Nowadays, graduates tend to avoid manufacturing and construction jobs. The country therefore needs a much bigger and robust service sector to absorb much of this number. Unfortunately, its service sector is still small. The result has been the high rates of youth unemployment that have recently earned the “There, I told you so” cynicism from the western media.
Necessity is the mother of invention. I am quite confident that with its cultural foundation, entrepreneurs will rise to the occasion to grow the service industry.
There is a great deal of herd mentality amongst economists. They love to use past patterns and statistics to predict the future. Everything appears structural to them, when the real culprit is actually cyclically driven or circumstantial in nature. China’s apparent downturn in their eyes is to me a case in point.
The
force that is driving and shaping this herd mentality is the west’s media. Remember US has allocated – under the
America COMPETES Act – USD500 million for media outlets to produce journalism
for overseas audiences that is critical of China. It funds the US Agency for Global
Media, a US-run foreign media service, as well as local outlets and programmes
to train foreign journalists.
I have a friend who is an editor with a leading daily in Hong Kong. He pores over hundreds of articles from newspapers, tv channels and journals everyday and would take pain to extend the links to friends. Just the last two months alone, I spotted the following and readers can see for yourselves the motives behind these articles. (Do see who the authors are. Several are Chinese ethnically!) The most venomous of which I can conclude is The Economist. To me, it is the most patronizing journal. They should advise its government what to do instead of telling Confucius how to teach Chinese young.
SCMP – Another charm offensive from China: China eager for closer supply chains and no decoupling, Premier Li Qiang tells inaugural expo, in latest charm offensive.
Kinling Lo
23 November
The Economist – How China Lost Europe, China’s
European diplomacy is on losing streak. Both sides may come to regret it.
Nicholas Bequelin
21 November
The Economist -
A Paradigm Shift in America’s Asia Policy. Washington Must Get More Countries
Off the Sidelines in Its Contest with China.
John Lee
The Economist – Xi Jinping repeats imperial China’s mistakes. Lessons of a loyalty test that stifled innovation.
15 November
The Daily Telegraph – Xi Jinping won’t be able
to save Communist China from disaster.
15 November
BBC – Xi Jinping arrives in US as his Chinese
Dream splutters.
15 November
AFP - Biden says China has 'real problems'
ahead of key US summit with Xi.
13
November
The Economist – China’s leaders will seek to exploit global divisions in 2024; But they will
continue to preach harmony.
David Rennie
9 November
The Economist – China wants women to stay home
and bear children; Xi Jinping shares his vision for a patriarchal society.
9 November
The Economist – Not all fun and games; The people of Hong Kong are
growing more tolerant. Their government is not.
6 November
The Economist – The People’s Liberation Army is
not yet as formidable as the West fears. Overestimating China’s armed forces
would be dangerous.
Jeremy Page
6 November
The Economist – China’s economy is a mess. Why
aren’t firms going under? The government’s desire to avoid bankruptcies is
another drag on growth.
5 November
Foreign Policy - The Inevitable Fall of Putin’s New Russian Empire, What history
tells us about collapsed empires trying to restore their former possessions.
Aleander Motyl
3 November
CNN – As the scattered
patrons hop from one deserted bar to the next, it’s hard to believe the
near-empty streets they are zigzagging down were once among the most vibrant in
Asia.
2 November
Foreign Affairs
- Why China Can’t Break Its Coal Addiction; The CCP Prioritizes Energy Security
Over Fighting Climate Change.
Michael Davidson
2
November
The
New York Times – This city never slept. But with China tightening its grip, Is
the party over?
Foreign Policy – The Maoist Roots of Xi’s Economic Dilemma; Beijing needs domestic
consumers to spend more, but the Chinese president’s ideology is getting in the
way.
Jeremy Friedman
2 November
Nikkei – Analysis:
The mysteries and dangers that trail Li Keqiang's death; Xi Jinping's 'eternal
rival' was behind this summer's Beidaihe drama.
30 October
The Telegraph – Chinese minister invited to AI
summit helped to create cyborg rats; Wu Zhaohui has also been described as man
'whose fingerprints are all over the Uyghur genocide'.
28 October
The New York Times – One country, one system?
Hong Kong’s judiciary faces test of independence; Beijing’s security law has
had far-reaching-effect, snuffing out most of the free press, civil society and
political activity.
Denis Staunton
27 October
The Guardian – Li Keqiang, former premier of
China, dies aged 68; Li served as China’s number two leader for 10 years before
being sidelined by Xi Jinping.
Helen
Davidson
27 October
BBC – Why Li Keqiang's death is dangerous for Xi Jinping.
Stephen McDonell
5 October
Nikkei – Analysis:
Inside Xi Jinping's great military purge; Absences from National Day banquet
reveal determination to cement army's loyalty.
2 October
The Economist – The young and
the nationalist; Communist
rappers are luring young disgruntled Chinese; The party’s youth wing is growing.
1 October
The Guardian – Beijing’s mixed messages leave
businesses ‘questioning’ investments in China; A renewed focus on national
security coupled with rising geopolitical tensions has damaged confidence in
the private sector; Peak China? How the middle class hit a brick wall.
Amy
Hawkins
To be fair, there are also those who are pretty ojective in their reporting or assessments, but these are few and far between. I must say, of all, Pearls & Irritations is most commendable. Their contributors are usually scholars and thinkers. Below are the examples that I saw during the two-month period.
SCMP – How US’ anti-China supply chain strategy risks hurting American consumers.
Christopher Tang
Pearls & Irritations – Sacrificing pawns in the USA’s geopolitical game.
Jerry Grey
Pearls & Irritations – White Man’s Media: The Chinese warship sonar incident.
John Menadue
SCMP – The wonders of British human rights hypocrisy on Hong Kong never cease; While the UK called on the city to scrap its national security law, it was busy enacting its own draconian domestic versions.
Alex Lo
24 October
Foreign Affairs – What America Wants from
China. A Strategy to Keep Beijing Entangled in the World Order.
Notes from The Edge of the Narrative Matrix – If You Buy into The Anti-China Propaganda You’re Just a Stupid Asshole.
Caitlin Johnstone
2 October
Foreign Policy – Why the Global South Is Accusing America of Hypocrisy
2 October
Brave New
Europe – Five things that the west doesn’t understand about China’s
foreign policy.
Tom Harper
* * * * *
What is d name of speaker? It is good of u to speak ur honest opinion!
ReplyDeleteRichard Yetsenga of ANZ. if.you want to know the academic's name, i am happy to tell you privately.
DeleteMy admiration for and hat off to Mr. Lim Yu-Book for standing up to people who like to talk China down. John Lee, who is a former senior adviser to Julie Bishop and quoted in Mr. Lim's article as the contributer of an anti-China article in The Economist, is just another America's Gordon Chang. I wish someone tells John Lee and Gordon Chang to their face that they don't deserve Chinese surnames.
ReplyDeleteI believe china will still outperform the rest of the world despite restrictions/sanctions, prohibition of certain investment, rising wages , housing glut and unemployment.. one question asked, why Chinese products are still so competitive.. transportation/communication.. the workers are at least twice as productive maybe even 4 times more compare to certain low wage countries.. it's just common sense, you waste less time on roads/work more on productive activities
ReplyDelete