Posted on 05/13/2009 5:37:33 AM PDT by TigerLikesRooster
Distant Holy Grail: China's Consumers
Tina Wang, 05.13.09, 1:34 AM ET
HONG KONG -- China is showing steady improvement in domestic consumption, as global and domestic companies set their sights and hopes on the world's most populous market. But bolstering the power of its consumers to full potential poses a long-term challenge for China and requires a structural rebalancing of economic growth.
China's retail sales continue to grow robustly, in line with market expectations and the year's first-quarter pace. Retail sales for April climbed 14.8% from the same time last year, to 934.3 billion yuan ($137.0 billion), according to the National Statistics Bureau on Wednesday. That compared with the market forecast of a 14.4% rise and March's gain of 14.7%. Beijing has unleashed numerous subsidies and other incentives to get consumers shopping more and saving less. In adjusted terms, China posted 17.0% real retail sales growth, compared with 16.4% in March, according to some analysts' calculations.
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Still, getting Chinese consumers to spend like those in the West will take at least several years. For all the talk of Chinese consumers' propensity to save, a key challenge is that wage growth has not kept up with the country's exports and investment growth, UBS economist Tao Wang said in a report this month
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The profitability of China's policy-driven growth remains a concern, as the industrial sector produces despite depressed prices. Profits for Chinese-listed companies plunged 25.8% in the first quarter, compared with the same time last year, according to J.P. Morgan data
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(Excerpt) Read more at forbes.com ...
Ping!
Well since China believing totally in free trade (sarcasm) has already kicked out Korean auto manufacturers, they can be counted on to protect their industry...as does most of the world. Only very foolish countries (like us) destroy their own manufacturing capacity while enriching dangerous Communist countries as well as every other country in the world.
Oh come on, the whole “free-trade-aren’t-we-the-greatest-country-on-earth-because-we-send-our-jobs-overseas-hoo-rah-America’s-Number-One” paradigm has worked out so well for us.
Yeah, my hubbie will have a six week ‘vacation’ soon...we hope it is only six weeks...but who knows?
Still, getting Chinese consumers to spend like those in the West will take at least several years.
It takes DECADES of crappy education and cheap credit to create a critical mass of people that stupid...
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