China

By Gideon Rachman
In 1996 a friend of mine called Jim Rohwer published a book called Asia Rising. A few months later, Asia crashed. The financial crisis of 1997 made my colleague’s book look foolish. I thought of Jim Rohwer (who died prematurely in 2001) last week as a I listened to another Jim – Jim O’Neill, formerly of Goldman Sachs – defending his bullish views on emerging markets in a radio interview.

By Gideon Rachman
Faced with a dangerous political threat, governments the world over tend to place their faith in the same magic medicine – economic growth. When world leaders try to address the roots of terrorism, for example, they instinctively assume that prosperity and jobs must be the long-term answer. And when a regional conflict threatens to get out of control – in east Asia or the Middle East – the standard political response is to call for greater economic integration. From Europe to China, governments place their faith in economic growth as the key to political and social stability.

Lionel Barber

I arrived in VIP-full Davos with one prediction in mind: 2014 will be the year the world returns to normality or at least the semblance of normality with the tapered exit from quantitative easing.

After three days at high altitude, the prediction is intact and I have five other takeaways. Read more

Martin Wolf

At a debate in Davos Joseph Nye, the American political scientist, asked the Chinese foreign minister, Wang Yi, what he felt about the comments of the Japanese prime minister Shinzo Abe on Sino-Japanese relations earlier in the week and especially the parallel Mr Abe drew between the pre-world war one relationships in Europe and those between China and Japan today.

These were Mr Yang’s key points in reply: Read more

Japanese prime minister Shinzo Abe did not shy away from discussing the tensions with China in his speech at the World Economic Forum in Davos. Lifen Zhang, editor-in-chief of FTChinese.com, examines the reaction of Chinese delegates and journalists.

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FTChinese.com editor-in-chief Lifen Zhang says the focus is not just on China’s economic power but its foreign relations. He also says Chinese business remains cautious about spending its cash piles.

James Gorman, the chief executive of Morgan Stanley, neatly summarised his view of US authorities’ so-called “princeling” probe, into whether rival bank JPMorgan sought to win deals in China by hiring the sons and daughters of the country’s elite.

“There are a lot of talented people that come from those families,” Mr Gorman told CNBC, in a television interview on the sidelines of the World Economic Forum in Davos, Switzerland. Full story on FastFT

By Martin Arnold, Banking Editor, in Davos

The first of many debates about China at Davos this year made an unexpectedly hostile debut this morning as Zhang Xin, head of Beijing’s biggest property developer Soho, was put on the spot over the country’s crackdown on corruption.

“Your industry is one of the most corrupt in China,” said moderator Andrew Browne, China editor of the Wall Street Journal, as he asked Ms Zhang to share her views on the issue. Read more

By Gideon Rachman
The official theme for this year’s World Economic Forum is predictably bland – “Reshaping the World”. But the unofficial slogan will be “America is back”. Predictions that the US economy will grow by 3 per cent this year – added to worries about emerging markets – mean that Davos is likely to be bullish on America for the first time in years.

 

One of the most popular slang terms in China these days is tuhao, sort of a cross between “vulgar tycoon and “nouveau riche”. Think Beverly Hillbillies, China-style.

These days China needs these hillbillies and their spending power more than ever. The economy, as figures released on Monday show, is again more reliant on investment than it is on consumption – nearly a decade after it began talking about rebalancing. Read more