China's Looming Economic Crisis!

China's Looming Economic Crisis!

Posted in the China Forum

LOVE CHINA DESTROY CCP

Port Moody, Canada

#1 Mar 8, 2013
China’s Looming Economic Crisis. Poverty and Rising Social Inequalities
By John Chan
Global Research, March 08, 2013

Outgoing Premier Wen Jiabao warned this week, in his final report to the National Peoples Congress (NPC), that China faces a series of unresolved crises, ranging from a lack of access to basic healthcare and education, to a yawning gap between rich and poor, and an “unbalanced, uncoordinated and unsustainable” economy.

A new leadership will be formally installed at the NPC, which opened on March 5. Chinese Communist Party general secretary Xi Jinping, anointed by last November’s 18th party congress, will take over the presidency from Hu Jintao, while Vice Premier Li Keqiang will succeed Wen.

Efforts were made to disguise the gross social inequality that dominates the Chinese regime. In recent years, scenes of wealthy NPC delegates bearing mink coats, luxury European handbags and watches, or reports of their combined fortunes, totalling tens of billions of dollars, have fuelled popular anger in China. The NPC has become known as a “billionaires’ congress.” Xi’s new leadership recently warned of the fate suffered by the French aristocracy during the French Revolution. That is why luxury brands were reportedly absent among the NPC delegates arriving at Beijing’s Great Hall of People this year.(See:“China’s red aristocracy”)

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LOVE CHINA DESTROY CCP

Port Moody, Canada

#2 Mar 8, 2013
...
Nevertheless, the NPC delegates include 83 billionaires, measured in US dollars. Another 53 billionaires are delegates to the advisory body meeting alongside the NPC, the Chinese Peoples Political Consultative Conference.

Wen’s report reflected the needs and concerns of this tiny super-rich elite, including his own family, which has reportedly amassed $2.7 billion. These elements are deeply hostile to, and fearful of, the 400 million Chinese workers they exploit.“We are keenly aware that we still face many difficulties and problems,” Wen said, referring to the widening gulf between rich and poor, official corruption and environmental degradation. As a result,“social strains are clearly increasing.”

The danger of social unrest has increased as the global economic slump has overwhelmed the impact of Beijing’s stimulus measures since the global crash of 2008. Wen predicted economic growth this year of just 7.5 percent—down from last year’s actual growth of 7.8 percent, the slowest pace since 1999. Even this would be achieved only though “hard efforts”, he said. Such a growth rate, he claimed, would create nine million jobs in order to keep urban unemployment under control, mainly through shifting the government’s economic model from an export-led one, to one based on domestic consumption.

Wen stressed repeatedly the need to provide social protection to the poor, as a key mechanism to boost consumption. He said the government would spend 655 billion yuan on social welfare.“To expand individual consumption, we should enhance people’s ability to consume, keep their consumption expectations stable, boost their desire to consume, improve their consumption environment and make economic growth more consumption-driven,” he said.

In reality, the CCP bureaucracy cannot simply adopt a new economic model. China is a highly specialised cheap labour platform, geared to export production on behalf of transnational corporations. Higher wages could undermine the competitiveness of China’s export industries.

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LOVE CHINA DESTROY CCP

Port Moody, Canada

#3 Mar 8, 2013
...
In fact, Wen’s government presided over the largest decline in consumption, as a share of the economy, in Chinese history. With millions of workers on poverty-line wages in order to boost export-led production, private consumption as a share of gross domestic product (GDP) fell to 33 percent in 2010, down from 46 percent in 2000. Physical capital investment surged to an unsustainable 40-50 percent of the GDP, compared to 20 percent in most developed countries.
Workers and poorer rural farmers, cannot become a new consuming force, not only because of their low incomes, but due to the lack of any social protection network to secure them from joblessness or illness. That forces them to save for their own retirement or inability to work.
The state-owned enterprises that once provided a minimal safety net to urban workers have largely disappeared since the massive privatisation program of the 1990s. Xi’s leadership is under instructions from the 18th party congress and international capital to open up the remaining state sectors to private ownership.
As for the 200 million internal migrant workers, who are part of the urban workforce but deprived of residency rights, education and other public services, their jobs and livelihoods depend on expanding the labour-intensive export industries. Yet, China’s main markets in Europe and America are mired in slump.
Wen set a growth target for foreign trade of just 8 percent, down from the 10 percent goal in 2012. Even that is optimistic—actual growth was only 6.2 percent last year, down from 22.5 percent in 2011. With rising competition from other low-wage platforms like India, and the drastic lowering of pay rates in Europe and America, Chinese exports can expand only by enforcing higher productivity and lower wages.
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LOVE CHINA DESTROY CCP

Port Moody, Canada

#4 Mar 8, 2013
...
Because of a crisis of overcapacity, manufacturing capital has engaged heavily on real estate speculation, rather than production. As a result, economists are warning of a “nightmare scenario” for the Chinese economy. In a revealing sign of fragility, the Shanghai share market tumbled on the opening day of the NPC, with the property index down almost 10 percent during the day.
The sharp fall followed a government announcement of measures to curb real estate speculation. Following the stimulus package in 2008, housing prices soared 20 percent in 2009. Despite measures by the government in late 2011 to bring prices down, the deepening European debt turmoil last year forced the Chinese central bank to inject more credit into the economy, further pushing up home prices, which are already beyond the reach of most people.
Mark Williams of London’s Capital Economics recently noted in China Daily that 11 million housing units were built in 2012, yet it was “the sector’s most difficult year on record”. That was because a small wealthy layer bought most units as investments, rather than residences. If the building rate continued,“that would leave a colossal glut of housing that could only be sold if prices collapsed,” he commented.
Tom Holland of the Hong Kong-based South China Morning Post warned that China faced a crisis of “stagflation”:“If they keep the credit taps open, the asset bubbles and the inflation rate will only get worse. If they close off the supply of credit and tighten monetary policy, growth will slow even further, asset prices will collapse, and they run the risk that many of the new loans will turn bad, triggering a banking crisis that could weigh on growth rates for years to come.”
With these economic and social contradictions looming, the regime is assembling a massive repressive apparatus to suppress unrest. For the third consecutive year, the domestic security budget of $124 billion (up 8.7 percent) outstripped military spending of $114 billion (up 10.7 percent) and also Wen’s proposed social welfare spending of $105 billion. These economic priorities demonstrate that Beijing’s greatest fear is not US military encirclement or the revival of Japanese militarism, but an uprising by the working class at home.
LOVE CHINA DESTROY CCP

Port Moody, Canada

#5 Mar 8, 2013
Chinese guy from San Jose

Cupertino, CA

#6 Mar 9, 2013
Loser, Becareful. The ill faith you hope on the Chinese will be multipled by the bloody collapse of your society soon. LOL
Old Jew

San Francisco, CA

#7 Mar 9, 2013
China is great, many Jews are flocking there.
atilla the Han

Australia

#8 Mar 10, 2013
looming glooming grooming

twisted wicked wish from the witch of ipswich.
Old Jew

San Francisco, CA

#9 Mar 10, 2013
Cheers to China.
HeyHeyHoHo CCP HasGotToGo

Port Moody, Canada

#10 Mar 11, 2013
Chinese guy from San Jose wrote:
Loser, Becareful. The ill faith you hope on the Chinese will be multipled by the bloody collapse of your society soon. LOL
Traitor to China, be careful.

The corruption and mass-murders of your Chinese Communist Party dictatorship will be punished severely by the Chinese people. Their anger will be multiplied by the rage the Chinese people will unload on you CCP for lying to them, stealing from them, and abusing them for so many years.

Your shabby CCP dictatorship will soon collapse like all the others already have, and then you will be like Ceaucescu and his thugs in Romania; hated and hunted criminal traitors.

But, it is what you deserve, as you know.

Better burn your Communist Party card, loser.
HeyHeyHoHo CCP HasGotToGo

Port Moody, Canada

#11 Mar 11, 2013
China's House of Cards
By ChinaFile
Mar 11 2013, 7:30 AM ET 1

Will empty apartment buildings like these doom the Chinese economy?(Walter Stanish)

Dorinda Elliott:

At this week's National People's Congress, outgoing Premier Wen Jiabao proclaimed that the government kept housing prices from rising too fast. Really? I wonder what my 28-year-old Shanghainese friend Robert thinks about that. He and his fiancée could never dream of buying an apartment on their own, but his fiancée won't marry him unless he has one. Robert is lucky: his parents are spending their life savings to buy them a tiny apartment. Residential property prices have climbed 50 percent during Wen's last five-year term, according to statistics bureau data, to the highest level since China privatized home ownership in 1998.

The situation seems dangerously out of balance. In an interview with CBS's 60 Minutes last week, Wang Shi, CEO of Vanke, one of China's biggest property companies, said he thinks there is a property bubble, and that if the bubble bursts, there could be Arab Spring-like protests. When I saw my Shanghainese friend recently, he made the same point. In his experience, he said, young people are frustrated by rampant corruption, and many people can't find good jobs. "If the economy slows down, or housing prices drop," he said, "there could be serious unrest."

The government has to manage a delicate balancing act: on one hand, cool down the market, but on the other hand, avoid stoking public fury if prices sink. Real estate tycoon Wang said that apartment owners protested when he announced price reductions on some of his apartments. Will the government's new 70 percent required down payments on second homes and higher sales taxes help avoid a calamity? The stakes are high: Property investment now accounts for some 14 percent of the country's GDP, so if there is a serious collapse, I'm betting the ripple effects will be felt by Chinese, rich and poor -- and by us in the U.S.
Chinese guy from San Jose

Cupertino, CA

#12 Mar 11, 2013
HeyHeyHoHo CCP HasGotToGo wrote:
<quoted text>
Traitor to China, be careful.
The corruption and mass-murders of your Chinese Communist Party dictatorship will be punished severely by the Chinese people. Their anger will be multiplied by the rage the Chinese people will unload on you CCP for lying to them, stealing from them, and abusing them for so many years.
Your shabby CCP dictatorship will soon collapse like all the others already have, and then you will be like Ceaucescu and his thugs in Romania; hated and hunted criminal traitors.
But, it is what you deserve, as you know.
Better burn your Communist Party card, loser.
LOL... You must be stupid. I happen to think China is better off with a democracy. It is more war like than this disgrace we have now. The Chinese are superior than the monkeys In indian, or white whites, and blacks. You all deserve to die for your rottenness. burn in hell, bitch LOL
HeyHeyHoHo CCP HasGotToGo

Surrey, Canada

#13 Mar 12, 2013
Chinese guy from San Jose wrote:
<quoted text>
LOL... You must be stupid. I happen to think China is better off with a democracy. It is more war like than this disgrace we have now. The Chinese are superior than the monkeys In indian, or white whites, and blacks. You all deserve to die for your rottenness. burn in hell, bitch LOL
But you praise the CCP dictatorship and fear to disclose your CCP membership?

Traitor to China, be careful.

The corruption and mass-murders of your Chinese Communist Party dictatorship will be punished severely by the Chinese people. Their anger will be multiplied by the rage the Chinese people will unload on you CCP for lying to them, stealing from them, and abusing them for so many years.

Your shabby CCP dictatorship will soon collapse like all the others already have, and then you will be like Ceaucescu and his thugs in Romania; hated and hunted criminal traitors.

But, it is what you deserve, as you know.

Better burn your Communist Party card, loser.
Chinese guy from San Jose

Cupertino, CA

#15 Mar 12, 2013
South East Asians should all die for polluting the genetic of Northern Chinese LOL
LOVE CHINA DESTROY CCP

Surrey, Canada

#16 Mar 12, 2013
^Sick racist CCP living in California on cash they stole from poor Chinese are stinking up the state!
Chinese guy from San Jose

Cupertino, CA

#17 Mar 13, 2013
LOVE CHINA DESTROY CCP wrote:
^Sick racist CCP living in California on cash they stole from poor Chinese are stinking up the state!
LOL... If possible, I wish to massacre all those south east asian looking Chinese as well. You ideological bitch really is retarded indeed.LOL I also want to kill off the ccp for it is too foreigner friendly. I agree with you that the ccp is too weak. Soon, the ccp will be replaced by a democracy, and China will rise to dominate the whole fucking planet just like the US. China must shape international relations as the US for it to be a global superpower.
HeyHeyHoHo CCP HasGotToGo

Port Moody, Canada

#18 Mar 13, 2013
Chinese guy from San Jose wrote:
<quoted text>
LOL... If possible, I wish to massacre all those south east asian looking Chinese as well. You ideological bitch really is retarded indeed.LOL I also want to kill off the ccp for it is too foreigner friendly. I agree with you that the ccp is too weak. Soon, the ccp will be replaced by a democracy, and China will rise to dominate the whole fucking planet just like the US. China must shape international relations as the US for it to be a global superpower.
But China will always be a loser regime so long as the CCP dictatorship remains.
Chinese guy from San Jose

Cupertino, CA

#19 Mar 14, 2013
HeyHeyHoHo CCP HasGotToGo wrote:
<quoted text>
But China will always be a loser regime so long as the CCP dictatorship remains.
"loser regime"? Are you fucking 12? Must be, because that is just such a retarded thing to say. It is an ineffective regime. Obviously, it is not strong enough to save guard the Chinese nation, and its foreign interest. It is getting there, democracy might not be a bad thing with a strong military. LOL
CCP is DYING

Port Moody, Canada

#20 Mar 14, 2013
Chinese guy from San Jose wrote:
<quoted text>
"loser regime"? Are you fucking 12? Must be, because that is just such a retarded thing to say. It is an ineffective regime. Obviously, it is not strong enough to save guard the Chinese nation, and its foreign interest. It is getting there, democracy might not be a bad thing with a strong military. LOL
That's what I said, stupid.

China will always be a loser regime so long as the CCP dictatorship remains.

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