LyrArc Article Gist
China's efforts to promote trade with India. Visit by Premier Wen to New Delhi. Deals made include a loan from China Development Bank to help Reliance ADA group purchase power-producing equipment from Shanghai Electric Group Company. The two companies signed a $10 billion agreement in October 2010 for Reliance to buy power equipment. India sells mostly commodities such as iron ore and imports Chinese power and telecom equipment and manufactured goods at this stage. Trade estimated at $60 billion is tilted in China's favor because of cheaper manufactured goods imported from China. Premier Wen calls for expanding trade emphasizing the advantages of combining China's strengths in engineering and infrastructure with India's strengths in information technology and pharmaceuticals. His point: the 21st century is the Asian century, and both India and China can make great achievements. India sees the advantages of using China's strengths and cost competitiveness in telecom, power and other areas as it seeks to boost its development of infrastructure. Wen's visit follows visits by the UK's Cameron, US's Obama, France's Sarkozy, all pursuing trade and investment with India....

LyrArc Article Gist
The deteriorating business environment in China is shown in this report in the WSJ. An April 2022 survey by the EUropean Chamber of Commerce in China found 23% of companies were considering shifting current or planned investments in China to other parts of the world. This WSJ report says even before the latest covid lockdowns over one third of American companies told the American Chamber of Commerce they would reduce investment in the country due to the policy environment there. WSJ says there are serious question about the future growth of the Chinese domestic market and the stability of the overall policy environment for business. The distinct advantages of India and South East Asia are now becoming clear including growing youthful labor forces, and governments that as in India are part of the Free World democracies allied with America and the European Union says WSJ.

LyrArc Article Gist
China's exports to all countries surged in November by 21% from a year earlier. Chinese made consumer goods and electronic goods were the main products with increased exports. According to WSJ calculations November exports were up 10% to the U.S. and 46% to Asian nations in ASEAN trade group of countries. Some of the exports to ASEAN including Vietnam and Malaysia find their way to the U.S. New tariffs by U.S. on China lead to some products diverted to Asian destinations and reexported to the U.S. China's imports of goods from the U.S. were up 33% from a year earlier but imports of farm, energy and other products and services were below what was expected under trade deals. Experts say Chinese imports of goods covered in the agreement were 55% of the year to date targets. The Biden administration will leave the tariffs on $370 billion in Chinese goods in place. China is not expected to make up the gap by the end of 2020. Experts also say the exports of Chinese goods has accelerated during the pandemic in 2020 and with the size of the second wave in the U.S. In 2021 U.S. imports from China should slow as the U.S. manufacturing recovers following the vaccination effort.  Also expect increased focus on the trade gap as U.S. trade policy continues to focus on closing the trade gap and continuing policy of the Trump administration. ...

LyrArc Article Gist
China's sales of automobiles dropped by 7.4% to 20.7 million in 2019, according to the China Passenger Car Association. Sales of GM were hit hard with adrop of 15%, and Ford sales dropped for two successive years. Also hit hard were low to midrange Chinese brands with declining sales in western and central China. 

German and Japanese brands picked up sales with Toyota sales increasing by 9% in 2019.

 

LyrArc Article Gist
The WSJ Editorial Board speaking for the business community traditional Republican groups finally takes up the election on issues of policy difference between Trump run Republican party and Harris run Democratic Party which it should have from Day One. The former president says something that has never happened in the last hundred years- policy will be decided after the election depending on what he decides to do. Cost of Living action is No 1 on voter priorities. "Drill, Baby Drill," is the whole Republican party platform for cost of living action. What is the Harris Democrats policy plan for cost of living action? WSJ says it is spending blowouts that caused inflation, the Green New Deal, entitlement expansions and student loan forgiveness.The real reason for the increase in cost of living comes from the overconcentration of supply chain by American business in China, on which every president Bush, Obama, Trump, did little or nothing. The lack of an effective vaccination program and ineffective vaccines in China by 2021 and 2022 led to the loss of the supplies from China leading to shortages for automobiles parts and other supplies and surge in prices in 2021-2023. Powell and the US central bank correctly raised rates but cautiously and waited for this to correct, president Biden brought manufacturing home through huge investments called the "spending blowout" that brought down the inflation from 9% to 3%. Some of that "spending blowout" went to chips and science to correct the errors of American Business and Reagan-Friedman theory of the Republican party that created this problem with a culture of utter  indifference to the ultimate costs of who makes what and where. The Inflation Reduction Act also tackled higher health and other costs paid by American workers and families, and invested in public services and in repairing the dilapidated crumbling American infrastructure. Are Republicans saying let the roads, bridges, airports, built in the 1940-1960's heyday of American industrialization as China and India's is now, let them crumble? What do the educated minds of the WSJ Board say about coal in China and India and their effects on their massive use multiple times that of US and EU in history, is it not damaging to the environment and why the Chinese realized the health in North China with coal winter use was worse than in South China cut their coal use. Are they saying lets burn fossil fuels and ignore, and if investment has to be made in solar who is going to do it? Is it Ok for Republicans thet we just import from China all our solar panels indefinitely into the future. "Green New Deal" is just a perjorative term, policy has to be made thoughtfully and without prejudice or bias of any sort for the best that we can do for the American people, ignoring so called "right" or "left." Doing what is right, what makes sense, is a lot harder.     ...

LyrArc Article Gist
The WSJ is still calling the president's stop fentanyl flows tariffs on CMC Canada Mexico and China economic tariffs in this editorial board opinion. It is incomprehensible that little or no mention is made in most of the media of the magnitude of injury to the US, the 490,000 deaths in America over 12 years as the result of Canada, Mexico and China not taking the needed action to stop fentanyl flows into the US. There is also the added factor of lack of a level playing field in trade which has resulted in the same communities in many cases having suffered from in the case of China loss of 25 million jobs over the last 10 years and loss of $250 billion in infrastructure and public services for schools, libraries, childcare, and health care clinics that were lost from losses in taxes for local communities in the US. This has decimated life in these communities and in small towns across America.  In the case of Mexico the illegal migrant flows that were not stopped at the border have put an added burden on already underfunded and strained public services in local communities in the US. This is the reason for much of the frustration and anger that has built up over time in these communities with the response from the DJT administration to find solutions. CMC countries could have taken action on their own, yet the US had waited too long for this action. Reciprocal in reciprocal tariffs is about fairness, a level playing field, something that China had agreed to in the spirit of the WTO entry in 1994 and American desire to aid China industrialize build a modern economy. Instead US business was coopted by China during the industrialization process 1995-2010, 2010-2020, including in the first term of the DJT administration even when tariffs were imposed. This happened with transfer of technologies happening late into the first term of the DJT administration 2016-2020, which has led to a much of the pent up frustration and action in the first 100 days of DJT in 2025.  ...

LyrArc Article Gist
"China's Superbank," by Henry Sanderson and Michael Forsythe looks at the rise of China Development Bank to provide insights into the two decade real estate boom in China, and the trillions of dollars in loans made by state owned banks to finance China's state owned industries and infrastructure development. The authors say these loans based on land owned by the state, improved with roads and other infrastructure and then sold to industry, have helped finance China's urbanization and industrial development. But it has also created problems including eviction of farmers from the land by local government authorites increasing inequality, led to misallocation of capital on bad projects, and an unsustainable model of development focussed on state owned companies. A major side effect of this is not covered in the book. This is the impact of crowding out of credit for private industry in China, with privately owned business having to pay higher rates in the underground loan market or lacking financing. A major focus of the report "China: 2030" by the World Bank and China's official think tank Development Research Center is on reversing this development to come up with a sustainable development model. The report was supported by World Bank chief Zoellick and China's new prime minister Li Keqiang. "The Great Rebalancing," by Pettis, a finance professor at Beijing University, looks at the other side of the financing of China's boom- the low interest rates on savings for China's consumer. This reduces household incomes and reduces purchasing power as the interest rates are lower than the rate of inflation. Lower value of China's currency also reduces the purchasing power for China's consumers. Estimates show the low interest rates cost China's workers and consumers somewhere in the range of 3 to 8% of GDP annually in bank deposit income. This money is funnelled through the banking system to make more loans for infrastructure and growth at the state owned companies, concentrating exraordinary level of financing in one direction. As a result the consumption share of GDP in China has actually fallen in the two decades of hyper development. This is about 34% compared to 50-55% for other Asian economies....

LyrArc Article Gist
The S.E.C. anti-bribery unit investigation focusses on the hiring of the son of a former Chinese banking regulator, who is now chairman of state controlled China Everbright Group, and the daughter of a senior railway official by JP Morgan Chase bank. The China Railway Group, a state owned company that builds railways for the Chinese government, raised over $5 billion in 2007, with the help of JP Morgan. JP Morgan Chase advised a subsidiary of the China Everbright Group in a stock offering.

LyrArc Article Gist
For the first time in three decades US economic growth will be much faster than China's. Second quarter 2021 growth in the US was 12.2% compared to 7.9% in China, and will continue to be much higher for five consecutive quarters. This report in the WSJ says it is the result of the US response to the Covid pandemic. The US vaccination drive, massive fiscal stimulus and near zero interest rates have helped, including the confidence generated by the $1 trillion infrastructure investments planned for this decade. Over the longer term Capital Economic estimates China's GDP around 2030 will drop to 2% growth with demographic decline, just as the demographic factors favor Indian growth to levels that China has seen in the last two decades. This was the plan and vision set out by the Indian prime minister for 2047, on the 100th anniversary of independence. For the future government help has helped US households accumulate $2.6 trillion in excess household savings, which Moody's estimates is 7 times that in China.  In the longer term gaps will have narrowed between Asia and Europe, the US, which is a good thing. More will need to be done in Africa and Latin America. Much of the talk about who leads ignores the local needs in cities and towns across all parts of the world for a better quality of life, better education, better nutrition, better healthcare, meeting aspirations of young people, and supporting hope for a better future. ...

LyrArc Article Gist
A study by the director of the obesity center and professor of global nutrition at the University of north Carolina at Chapel Hill states that based on data collected from 20,000 patients in China over the last 15 years obesity has increased 1.2% a year among men in that time. The study says that more than 25% of the adults in China are overweight or obese and that the number could double in the next 20 years. Its a result mainly of improving living standards which make vegetable oil affordable, and beef and dairy foods more available and affordable. A sedentary lifestyle for many Chinese plays a part as well.

LyrArc Article Gist
Hon Hai chairman Terry Gou told corporate employees that Hon Hai plans to increase the number of robotic arms in its manufacturing plants from 10,000 to one million by 2013. He says the move will "improve working conditions and provide a better career path to employees." The improvement of working conditions is a major concern after a number of suicides. The plans to automate dangerous and monotonous tasks is intended to migrate workers to other work. Hon Hai has about 1 million employees in China. It is moving plants to the less costly interor of China where wages are lower- to Chengdu, Wuhan and Zhengzhou from the coastal areas.

LyrArc Article Gist
It is important to understand the tariffs imposed by the Trump administration because of the many misleading headlines. The new tariffs placed by the Trump administration on a list of 1300 imported products from China are for about $50 billion and targeted at high tech products in flat screen televisions, medical devices, aircraft parts and batteries, other high tech products that China hopes to get an edge over the U.S. under its "Made in China 2025" plan. China still enjoys a huge surplus with the U.S. This plan is intended to better manage the next phase of the competition with China as China seeks to get an edge in high tech products. The steel tariffs were targeted at China's buildup of surplus steel capacity in the last 2 decades, with little to do with the next phase of the competition globally between the U.S., the E.U. and China. This is a carefully planned move showing American resolve to be competitive in the high tech industries of the future. It will be followed by a comment period during which the administration will get feedback on product choices. A public hearing is set for May 15 in Washington, and companies can file objections till May 22. ...

LyrArc Article Gist
China is not experiencing high unemployment in 2012 the way it did in 2009. The lower growth rate of 7-8% is not having an adverse impact on unemployment. This makes it possible for the stimulus this time to be much smaller. There is rising upward pressure on wages. According to the National Bureau of Statistics, CEIC and WSJ, average annual wages at private sector manufacturing companies in current U.S. dollars was up 5% in 2009, 16% in 2010, and 20% in 2011. This is being encouraged by the government as China gradually shifts its economy towards higher domestic consumption and better standards of living for workers. Hon Hai Precision Industry Company added 82,000 workers in China in 2011. Salaries at the Shenzen plant were 2200 yuan or $345 a month in February 2012, an increase of 10%. An April survey by Manpower Group showed that a majority of companies will increase workers or hold employment stable, only 3% of companies will have job cuts. Demographic changes are also playing a part-with fewer people in the 15-19 age range, dropping from 120 million in 2005 to 95 million in 2015, according to UN estimates. The number of migrant workers remains steady at 252 million in 2012, up 4% from 242 million in 2010, according to the Bureau of National Statistics....

LyrArc Article Gist
Let sleeping tariffs lie is the approach of S. Korea, Taiwan, Japan, China, India, European Union, Germany, UK-  expect all trade agreements with the US to remain in place after Supreme Court decision as no country wants to go through the intensely difficult process of renegotiating on tariffs. It is also the case that DJT can replace these same tariffs using other tools and different legislation passed by Congress to stop unfair trading practices by other nations. The president is also appealing to the public, some of the tariffs are about fentanyl flows into the US, the unfair trade practices and subsidies were a problem for the Biden administration and rebuilding manufacturing was the goal of both DJT and Biden, and will be for future administrations.  When the media NYT, Washington Post respond they are following the editorial line taken that opposes the DJT administration on all issues, when WSJ respond it takes the textbook approach of economists and finance people that free markets are best without considering the real life issues. This is why the president said at his press conference after the Supreme Court decision that 22 Nobel Prize economists had said the economy could not be turned around for growth and low inflation in 1 year, and were proved wrong after the experience of 2025 with low inflation at 2.8%, low unemployment 4.3%, and growth of 2.2% in real GDP (with strong growth in quarters 2&3 of 3.8% and 4.4%). Expect all tariffs to be in place under other legislation to be in place in coming months. ...

LyrArc Article Gist
The severe drought in China is affecting the provinces of Shandong, Jiangsu, Henan, Hebei and Shanxi, which produce about two thirds of China's wheat. China's Xinhua news agency is reporting that the drought in Shandong province could be "the worst drought in 200 years." China's retail wheat flour prices were up 8% over the two months to January and up 16% from the same month in 2010. The drought puts at risk the winter wheat crop harvested in June, according to the FAO. The FAO provided figures showing that 5.16 million hectares of a total of 14 million hectares of wheat producing areas are affected. China maintains large stores of wheat, estimated at 53 millon tons in Dec 2010, by Ma Wenfeng, an analyst with Beijing Agribusiness Consultant Ltd. The reserves act as a buffer for shortages.

LyrArc Article Gist
The Biden administration makes its decision- it will continue the tariffs president Trump placed on about half of Chinese imports into the US. It also seeks new talks with China on trade. US is also pursuing other policies on trade that were not pursued by the Trump administration. Longer term it is about alliance building in trade with the European Union, Britain, Japan, South Korea, Taiwan and India. These alliances would jointly approach China on trade, economic and security matters.  Another approach is for the US to build at home. Congress is asked to approve $52 billion in subsidies that the Biden administration wants to give to companies so that they build the semiconductor plants of the future right here in the USA. The Biden administration is also aware that China is doubling down on technology purchases within China from Chinese firms to support its own high tech industries. In response it is laying down a policy of its own for the future step by step. The Chinese market now takes less priority than maintaining technological leadership of the US in all advanced technologies. The Biden administration is steering American industry and technology advancement in this direction. ...

LyrArc Article Gist
China's GDP growth for the second quarter of 2012 was 7.6% from the prior year. China set a target of 7.5% GDP growth in March 2012. About half of the GDP growth in 2011 was generated from investment spending. As part of a new Stimulus China is increasing bank lending and moving forward development projects in energy and infrastructure. Bank loans showed an increase from 793 billion yuan ($124 billion) in May 2012 to 920 billion yuan ($144 billion) in June 2012.

LyrArc Article Gist
The Kashmir Valley and the Kashmir region had a multiethnic community of Sikhs, Muslims and Hindus in the hundreds of years before 1947. It all disappeared after the cabinet meeting of Liaquat Ali Khan on 12th September 1947 when the plan to attack Kashmir using armed Pathan tribesmen and supporting military forces was approved. By the end of that year the surprise invasion had split Kashmir into two regions and led to a large scale dispersal of Sikhs, Hindus and other ethnic communities. This BBC report shows how this happened and how it changed a once peaceful region with a multiethnic society. Till the 15th century this region was Hindu and Buddhist with influences of Tibetan Buddhism and a center of creativity for Sanskrit culture and language. It changed with the Afghan and Persian invasions by 1580 and conversion to Islam of some of the Hindu population. By 1700 the Mughal empire decline and Afghan, Durrani dynasties ruled till about 1800 when the Sikhs under Ranjit Singh included Kashmir in the Sikh Empire based in Lahore, Punjab. This lasted under British patronage of the Dogra dynasty of Sikhs till 1947. In the 1901 Census of the British Indian Empire, the population of the princely state of Kashmir was 2,905,578. Of these 2,154,695 were Muslims, 689,073 Hindus, 25,828 Sikhs, and 35,047 Buddhists. The Muslim population was not homogenous and contained many tribes and the Gilgit Baltistan region was Shia Muslim, the Kashmir Valley Sunni Muslim and the mountainous regions had Pathans and many other tribes. This is why the region may have had Sikh and British rule for 150 years with even the Muslim communities existing with many different sub religions and living in amulti racial multi ethnic fabric that was upset by the invasion from the newly created state of Pakistan based in Islamabad using Pathan tribesmen and supporting military forces. What changed this was that after Kashmir was split in two by this invasion, China entered the northern border region of Kashmir called Aksai Chin and parts of Ladakh by building roads in 1956-57 and the occupation by China of this region including Tibet thousands of miles from Beijing in a remote region expansion by Communist China. ...

LyrArc Article Gist
The comparison of China with Japan as stress builds up from overexpansion of credit in the banking system. The sharp increase in credit following the 2008 financial crisis has built up stress in China's banking system. Japan went through a period of low growth and insufficient lending by banks. Banks refinanced bad debts to zombie companies in Japan leading to a long period of low growth. China faces a similiar period of low growth after a credit expansion binge.

LyrArc Article Gist
If the trade war escalates to the point at which president Trump imposes tariffs on all Chinese goods imported into the U.S. on Jan. 1, 2019, China could retaliate with its own tariffs and this might affect Boeing aircraft as well. The results would be to tip the economies of both countries into a recession, and affect Mr. Trump's best chances for reelection in 2020. This can happen as Mr. Trump has a great deal of confidence in his negotiating style. The negotiations so far have shown China misread the U.S. and Mr. Trump leading to a strong U.S. response.  There is also the importance of not losing face, Mr. Xi's domestic audience, Chinese industry that sees a fundamental change from state subsidies model as eroding its position and offering resistance, patriotic sentiment making it harder to meet U.S. demands. Fundamentally for Mr. Trump it is about U.S. trade deficit and changing the huge trade surplus of almost $1 trillion that China enjoys each year with the U.S. which has been and is no longer sustainable. Mr. Trump also has the backing of Republicans on this issue and Democrats cannot afford to be soft on this issue as it involves American workers and jobs are at stake. Both sides could be in for a protracted negotiation as Mr. Trump feels it is right for Americans to expect fair trade and technology transfer that respects American concerns. In addition the U.S. could sense that it exports less to China, is less dependent on exports than China, and as the party that is hurt by unfair practices insist on its position. After Japan agreed to U.S. demands that it reverse a huge trade surplus in the seventies in which Mr. Lighthizer was the negotiator its growth declined sharply and is economy stagnated. China may sense inside that this could happen to its economy. Today Lighthizer the U.S. negotiator and Trade Representative could also push hard because of he was able to convince Japan to change its course. ...

LyrArc Article Gist
China and India pass Mexico as immigration to the U.S. from Mexico declines rapidly, as a result of an improving Mexican economy, the 2008-2011 recession in the U.S. with sharp drop in jobs for construction, lower birthrates, and stricter U.S. law enforcement at the U.S. border with Mexico. Researchers using the American Community Survey of the U.S. Census Bureau found immigration from China increased to 147,000 from China, 129,000 from India, as it declined to 125,000 from Mexico, for 2013. This Survey counts a person as an immigrant for a particular year who says he was living abroad previously. Mexico shows a decline from 400,000 in 2000, with steady decline for every year after 2005. In 2000 India and China were at about 75,000, and did not cross the 100,000 mark till 2007. Other Asian countries are also at the top including S. Korea, Philippines and Japan. William Frey documents this surge in diversity in the U.S., -which is supplemented by now common intermarraige between young people from different countries of origin- in his book "Diversity Explosion."...

LyrArc Article Gist
Migrant workers in China are not allowed to bring their children with them when they move to work in factories located in urban areas. This is the large price being paid for the rapid industrialization in China for 2 decades 1990-2010 by the 61 million children of migrant workers. Lixin Fan's documentary "Last Train Home" documents the life of children of migrant workers separated from their parents for long periods of time. Analysis from the All China Women's Federation shows 75% of the 61 million children left behind by migrant workers have parental visits once a year mostly during the national Spring holiday. 82% of these children want their parents to come back home and 42% say they have no one to talk to when they feel bad. A large proportion of the children are missing parental attention at the most sensitive age when they most need it- 38% left behind are ages 1-5, 32% ages 6-11.

LyrArc Article Gist
The competing visions of Li Shufu of Geely, Volvo's new Chinese owner, and that of Stefan Jaccoby, CEO of Volvo. Volvo is known for a family friendly car with fuel efficiency and safety. Geely's vision for Volvo is a luxury car that will compete with Mercedes S class and the BMW 7 Series, and Lexus in the Chinese upscale market. The problem is that China is less than 10% of Volvo's worldwide market and Jaccoby wants to keep these customers who buy the Volvo as an understated family friendly car that emphasizes safety and fuel efficiency. Geely executives are moving in another direction and are focussing on the fast growing market for luxury cars in China. This segment is dominated by Mercedes, BMW and Lexus, who sell 90% of the cars in this segment. Such a strategy would depend on gaining acceptance in this segment, which is highly uncertain. It also risks alienating customers around the world who look at Volvo in a certain way, just as Subaru owners in the U.S. look at Subaru in a certain way. The culture clash is also reflected in the backgrounds of the two executives. Jaccoby, is quiet in manner, studied at the University of Cologne, and worked at VW before joining Volvo. Li Shufu is a son of former farmers who built Geely from humble beginnings in a rural area of China. Li wanted to move aggressively and build three plants in China. Jaccoby persuaded Li to make plans for one plant and make agradual expansion. The design of a new Volvo shown recently in Shanghai also represents a compromise. The design is called Concept Universe and gives a larger and different look for the Volvo....

LyrArc Article Gist
Toyota's market share in China is about 5-6%, lagging behind GM and VW. After a "willful pause" since 2012 when Toyota ran into quality issues following an aggressive expansion in manufacturing, Toyota is beginning to make investments in new assembly plants. New assembly plants will be built in Mexico and China with a $1.25 billion investment.

LyrArc Article Gist
A drought in northern China is shaping up to be the longest since 1951, matching one in the winter of 1970-71. This will affect world food prices as adverse weather has also affected Russia, Australia and Argentina, which are major food producers. China has large reserves of grain and has the foreign exchage reserves to import wheat. China's wheat imports rose to 1.2 million tons in 2010, according to Global Trade Information Services. This compares with global output of 682 million metric tons of wheat in 2009, as estimated by the UN Food and Agriculture Organization. Because China accounts for one sixth of global wheat production, this will put pressure on wheat prices. The Chinese government has cushioned price rises by asking provinces and cities to raise the minimum wage, which went up by 18% a year in Guangdong province.