By Michael Pettis
In October two Chinese academics presented research proposing that China’s National Bureau of Statistics under-reports the Chinese household consumption share of GDP, officially at 36 per cent, by ten to twelve percentage points. There have been other studies suggesting that consumption is understated in the official data (although by much lower amounts). Analysts who still doubt China’s need for significant economic reform have often claimed that consumption in China is much higher than the official data reports. These upward revisions show, they argue, that the consumption imbalance in China’s economy is not as bad as is often supposed, and so will not require a sharp slowdown in economic growth as China rebalances its economy.
There are at least three reasons to be sceptical about this argument. Continue reading »
Hong Kong investors fond of buying into IPOs have been starved of late. The market for raising capital in the city has been dead for months, prompting some potential issuers to postpone, or even just scrap plans altogether.
But on Monday, those hoping that Hong Kong might be waking up received a much-needed calorie hit with the listing of Cantonese eaterie Tsui Wah. Continue reading »
Remember those ghost malls in China? Sad, massive buildings like the New South China Mall in the southern factory town of Dongguan – the world’s largest by leasable area when it opened in 2005 – that just sit there empty for lack of tenants and customers?
According to new research on shopping centres by Knight Frank, the property consultancy, the ghost mall syndrome is spreading: overall vacancy rates in major cities have gone up this year. Continue reading »