How is this really different from all of
the other measures and plans that we've heard about from Beijing?
I think this is really important because of the timing of this announcement.
We've just had really poor data in terms of FDI by some measures.
Foreign investment in China is at the lowest it's been in 25 years.
Just weeks after that, the government coming out with a number of measures
promising to treat foreign investors the same as they would treat Chinese
companies, promising to make it e
asier for the employees of foreign invested
companies to get visas to work in China, trying to make it as easy as possible to
encourage foreign companies R&D here in China, something that the country
desperately wants to try to move the economy up the value chain.
I think it also speaks to the state of the economy being as weak as it is that
the government is trying to do all it can at the moment.
John, these are all laudable measures, I'm sure.
But China's got a history of regulators acting ver
y quickly, very unpredictably,
very strictly. Is this perhaps what's making foreign
investors nervous? So I think that's a good point, Paul,
because what you have is sometimes the actions that regulators take do not
necessarily match the words. And so while you have the regulators
coming out and encouraging verbally promises about treating Chinese
companies sorry, foreign companies the same as they were true Chinese
companies, at the same time, you have things such as investigations into state
s
ecrets, greater clampdowns on the way that data is shared across borders, all
of which makes not only it harder for foreign companies to do business in
China, but also more jittery about what rules are being imposed and what rules
are being executed here in China. What are economists not only saying
about when we can see a turn around for the Chinese economy?
Well, I think it's obvious that the economy is not going to grow at the pace
that many expected at the beginning of this year when there w
as this widely
held thought that it would come roaring back from the end of Covid Covid zero.
The target for the year is still about 5%
economic growth. I think there is still broadly an
expectation that China will meet that it will get very close to 5%.
So I think the drop off is going to be substantial.
I do not think that there is anything on the horizon that looks like that will
change the trajectory of growth anytime soon.
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