Latest / The SME Stream / Peter Lewis: Asia business correspondent says China's economy shows signs of strain

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Peter Lewis: Asia business correspondent says China's economy shows signs of strain · The SME Stream

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  Speaker 1: Sale is coming. Please don't find.
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  Speaker 2: Welcome back to the program. And so the battle continues
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  Speaker 2: on the text ninety two ninety two small charge appliers
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  Speaker 2: about whether a duty lawyer on one hundred and eight
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  Speaker 2: dollars an hour as well paid or not. And of
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  Speaker 2: course we've got some people who are caregivers saying i'd
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  Speaker 2: call for that sort of money because they're on less
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  Speaker 2: and we know that. And we've got another text in
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  Speaker 2: here saying, dickens, a caregiver doesn't go to law school
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  Speaker 2: for five years and come out with a massive debt.
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  Speaker 2: So that is a stupid comparison, but that is true.
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  Speaker 2: But at the same time, a caregether lives with the
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  Speaker 2: person that they're given care with, possibly for all their lives.
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  Speaker 2: Many caregivers never work at all and can never work
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  Speaker 2: at all because they have somebody that they have to
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  Speaker 2: give care too and it's not their choice, and it
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  Speaker 2: is a full time profession, and the work they do,
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  Speaker 2: it's very important because it saves the state from the
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  Speaker 2: money spent from institutionalization. So that's sort of fair comparison.
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  Speaker 2: Either the duty lawyer is doing something of their own
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  Speaker 2: volition and of their own choice. But many caregivers have
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  Speaker 2: not been given the choice. It's their familial obligation. And
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  Speaker 2: really if they were given the choice and they could
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  Speaker 2: actually make the decision, they wouldn't be doing what they're doing.
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  Speaker 2: At the same time, both of them, the duty lawyer
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  Speaker 2: and the caregiver, are doing God's work and I thank
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  Speaker 2: you for that. It is twenty two to seven. After
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  Speaker 2: Asia we go Peter Lewis, good evening to you.
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  Speaker 1: Good evening, Andrew.
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  Speaker 2: So, China's economy. We're always looking at China's economy. It's
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  Speaker 2: got a bit of strain. Considering the whole twer for
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  Speaker 2: and considering everything, it's been doing well, but it's showing
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  Speaker 2: signs of strain. In November it is indeed.
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  Speaker 1: I mean, if you look into the details, we had
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  Speaker 1: a whole load of data on fixedas's investments, on retail sales,
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  Speaker 1: on industrial production. I think the most worrying thing is
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  Speaker 1: fixed acid investments actually, which has now declined for the
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  Speaker 1: third month in a row. Now we've never seen that before.
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  Speaker 1: Since data was first published by China on its economy.
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  Speaker 1: Normally there's been a lot of interest in investing in China.
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  Speaker 1: But what this is now term negative and it shows
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  Speaker 1: that both businesses and households just don't want to invest
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  Speaker 1: at the moment in the Chinese economy.
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  Speaker 2: Now.
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  Speaker 1: One of the main reasons for that is this slide
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  Speaker 1: in house prices, which we've seen now for four years, NonStop.
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  Speaker 1: Investments in property down about sixteen percent from a year ago,
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  Speaker 1: and that's being transmitted more to the consumer side. What
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  Speaker 1: consumers are doing is they're looking to pay down debt
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  Speaker 1: at the moment rather than spend money and build up
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  Speaker 1: new expenditure. So this is going to be a challenge
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  Speaker 1: for China next year because Mehijinping wants to reorientate the
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  Speaker 1: economy towards more the domestic side and less reliance on exports.
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  Speaker 1: Many overseas countries have called for that as well. They're saying.
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  Speaker 1: We had Immanual Macron in Beijing just last month saying
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  Speaker 1: that the pain that all this reliance and exports was
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  Speaker 1: causing to overseas economies was unbearable, and the IMF has
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  Speaker 1: called for China to rebalance its economy over the coming
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  Speaker 1: months more towards domestic consumption. So this is going to
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  Speaker 1: be the big challenge for China next year. Now, in
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  Speaker 1: some ways, I mean, you know, it's in a good
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  Speaker 1: position to be able to do that. If you look
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  Speaker 1: at this economy overall, it's growing at five percent year
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  Speaker 1: on year. Now that's a good rate of growth. Many
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  Speaker 1: countries would be would love to see that sort of growth.
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  Speaker 1: But it's very very lopsided, relying very very heavily on exports.
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  Speaker 1: So this is going to be the big challenge for
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  Speaker 1: China in twenty twenty six.
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  Speaker 2: Absolutely, the Chinese tiger, though, has been going great guns
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  Speaker 2: over the last fifteen to twenty years. But Ji Jimping
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  Speaker 2: gave a very interesting warning to his officials because he
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  Speaker 2: doesn't want them to chase what he would call reckless
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  Speaker 2: GDP expansion.
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  Speaker 1: Yes, indeed, and he's talking a lot about in particular
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  Speaker 1: reckless sort of themes like large industrial parks, building all
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  Speaker 1: these unnecessary cities, of some of which he is promoted.
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  Speaker 1: He promoted a huge new mega city south of Beijing,
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  Speaker 1: which was supposed to eventually take over from Beijing, but
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  Speaker 1: that never really happened, and all that's there is empty
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  Speaker 1: apartment blocks and empty empty factories. But he wants an
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  Speaker 1: end to that, and he wants sort of economic plans
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  Speaker 1: to be based around sustain the long term gains, particularly
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  Speaker 1: trying to boost the sort of green economy, and he
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  Speaker 1: wants to change the way in which local government officials
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  Speaker 1: are evaluated. He said they shouldn't be judged on GDP
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  Speaker 1: growth rates, but on broader achievements such as improving people's
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  Speaker 1: well being, maintaining stability, on so on. This reminds me
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  Speaker 1: a little bit of Bhutan's measure of its well being
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  Speaker 1: by gross national happiness rather than gross national products. But
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  Speaker 1: he wants he wants to change the whole way in
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  Speaker 1: which officials are measured so that they're not tempted to
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  Speaker 1: chase sort of unrealistic growth targets and using unsustainable methods
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  Speaker 1: and fake statistics and the likes to achieve that. So
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  Speaker 1: he wants sustainability and more long term goals in the
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  Speaker 1: economic growth environments.
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  Speaker 2: Will helps when you have a domestic market of like
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  Speaker 2: one point to one point three billion people that you
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  Speaker 2: can survive on that. And they've seen the shots that
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  Speaker 2: have come from America, and they've also been developing. While
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  Speaker 2: they've been doing all the export, they've also been doing
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  Speaker 2: all that incredible power network and as you say, sustainable
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  Speaker 2: green power production and building data centers and all that
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  Speaker 2: sort of thing. So they're quite self reliant, quite a
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  Speaker 2: remarkable economy. Now lit's been to another country. Let's go
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  Speaker 2: to Thailand, where things are not getting any easier. They've
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  Speaker 2: just dissolved their parliament and they're still in conflict with Cambodia.
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  Speaker 1: Yes, indeed, I mean Thailand has never really recovered from
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  Speaker 1: the pandemic. It's an economy that's very dependent upon tourism
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  Speaker 1: and it's just really struggled to get momentum behind its
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  Speaker 1: economy since that, since then, and that's the case today
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  Speaker 1: as well. It also has a rather unstable political environment.
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  Speaker 1: The government has to rely on rather large, unwielderly coalitions
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  Speaker 1: and there's elections on a regular base. Is well, now
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  Speaker 1: we've got another one. The prime minister disaster to dissolve parliament,
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  Speaker 1: which the King has granted, so that means there now
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  Speaker 1: has to be another election within forty five to sixty days.
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  Speaker 1: Rather alarmingly, the Prime Minister Anatin is sort of turning
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  Speaker 1: to nationalistic sentiments. This often seems to happen with governments,
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  Speaker 1: doesn't it Around Asia, around the world actually, when they're
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  Speaker 1: fighting for their political survival. So he's sort of rather
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  Speaker 1: relying on these border clashes with Cambodia and taking a
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  Speaker 1: very hard line stance on that he doesn't want a
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  Speaker 1: cease fire at all until basically Cambodia sort of capitulates,
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  Speaker 1: and that he hope it will boost him that hard
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  Speaker 1: line stance in the polls ahead of the election. The
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  Speaker 1: problem is this clash with Cambodia is really disrupting trade
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  Speaker 1: the moment and also putting tourists off as well, so
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  Speaker 1: it's not helping the economy and there's a risk that
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  Speaker 1: if these migrant labor flows, which Thailand is very dependent upon,
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  Speaker 1: are disrupted, or even worse, if Donald Trump, who helped
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  Speaker 1: broker the peace agreement between the two countries, decides to
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  Speaker 1: reimpose tariffs on Thailand, then its economy is really going
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  Speaker 1: to suffer.
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  Speaker 2: YEP, thank you so much. Peter Lewis out of the Asia.
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