[AIG]

China is certainly still a developing country. But it's just progressing faster and more effectively than today's Third World republics (India, Indonesia, Russia, Brazil, Argentina, Turkey, S. Africa, etc.), which are plagued by legislative gridlock and majority-poor populations and thus majority-socialist politicians who oppose capitalist reforms. China's authoritarian government can enact economic reforms much more expeditiously. Despite 50 years of democracy, India has yet to enact basic labor reforms that would allow private businesses to hire people when they want to and fire people when they want to, or basic land reforms that allows private real estate transactions to occur. This year, China will exceed $50 bil. in direct foreign investment for the first time, which is more than all the other developing countries put together. So while China still has a long way to go, it's more promising than every other large developing country.

[Torie]

China will not really get going until it can allocate capital efficiently. It won't do that with a centrally directed economic system and insolvent banks, protectionist barriars, and a dysfunctional legal system that cannot be trusted by investors. It will for so long as that obtains be a poor man's Japan.