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China Economic Watch

This blog monitors ongoing developments in China's economy, analyzes the impact of policy changes, and informs readers about new PIIE research on China.

Recent Posts

China Chart of the Week: Let A Million Companies Bloom

by | August 29th, 2014 | 03:00 pm

Many China watchers were dismayed by slight weakness in economic data for July, adding to fears that China may still be struggling to overcome a slowdown in real estate investment. However, these concerns do not appear to be deterring people from starting new companies. The State Administration for Industry and Commerce (SAIC) shows that China […]

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China’s Embrace of Markets Is Responsible for its Growth

by | August 25th, 2014 | 01:36 pm

China’s long-term economic growth since reform began is largely the result of the emergence of a dynamic private sector. The de facto privatization of agriculture early in the reform period, via contracting to households and allowing the reemergence of rural markets, led to an unprecedented acceleration of farm output in the first half of the […]

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Does China have an SME Lending Problem?

by | August 22nd, 2014 | 11:40 am

Economies across the globe struggle with providing small and medium enterprises (SMEs) access to loans. Banks are often accused of favoring large customers at the expense of everyone else. China appears to be no exception as Premier Li Keqiang recently criticized Chinese banks for favoring large borrowers. While it’s true that SME financing is a […]

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China Chart of the Week

by | August 21st, 2014 | 03:22 pm

It has been exactly a century since the small country of Belgium was the subject of a furious international debate. Now, for those who watch international capital flows closely, one recent development that has sparked a much more pedestrian debate has been the remarkable increase in the size of Belgium’s US Treasury holdings over the past 18 […]

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China Chart of the Week

by | August 13th, 2014 | 12:05 pm

New figures from the National Bureau of Statistics revealed that fixed asset investment in China continued to decline, reaching the lowest level since December 2001. In particular, investment in the industrial sector and real estate development have fallen dramatically. China’s recent efforts at targeted stimulus may be responsible for averting an even more rapid decline. […]

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China Price Reform Update – 1H2014

by | August 6th, 2014 | 09:27 pm

Last November the Chinese Communist Party made an unprecedented step forward in market reforms when it made a commitment to allow the market to play a decisive role in resource allocation (使市场在资源配置中起决定性作用) by the end of 2020. In China the market determines all prices with a few important exceptions. For example, the price of petroleum, […]

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A Day of Reckoning for China’s Trusts

by | August 4th, 2014 | 09:41 am

The third and fourth quarter of 2014 will be a turning point in the trust industry, as repayments of interest and principal of trust products are expected to peak during these two quarters and remain high for 2015 as a whole. The combination of mounting payoffs and non-performing loans are likely to rattle the whole […]

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China Rebalancing Update – Q2 2014

by | July 31st, 2014 | 02:42 pm

With all the relevant economic data out, we can now update our rebalancing indicators for the second quarter of 2014: 1. Urban Disposable Income Growing Faster than GDP The gap between GDP growth and urban disposable income growth expanded in the second quarter of 2014. The gap increased to -0.4 percent versus -0.2 percent in […]

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US Tech Firms Face Chinese Hurdles

by | July 29th, 2014 | 01:11 pm

Edward Snowden’s revelations, along with cyber-espionage cases and China’s IT protectionist tendencies have combined to create a storm for US tech firms.  Chinese investigations and sanctions directed at foreign IT firms started more than a year ago and have grown more frequent in recent months. Following the US government’s indictmentsof five PLA officers for cybercrimes […]

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Let the Good Times Roll: China’s Growing Influence in South Korea

by , Kent Troutman | July 25th, 2014 | 05:06 pm

Xi Jinping’s recent visit to Seoul was remarkable for a number of reasons. It was the first in which a Chinese president visited the South before the North, no doubt a thread which the Kim regime took note. It also highlighted both leaders’ distaste and distrust for neighboring Japan. But, perhaps most importantly, it reinforced […]

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