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World Bank chief Zoellick sees advantages for China to remake its industrial structure and its society especially boosting local wages and increasing the purchasing power of ordinary Chinese through a strengthening of the yuan.

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The Economist magazine says China needs to find a way for Chinese citizens to participate in governance without risking the kinds of upheavals that have happened in the past, including Tiananmen. One way to do this is to see Hong Kong more as opportunity than threat, and allow an experiment to happen in a place ideally suited for this with its long traditions of free expression. Jinping is faced with a chance to do his country a great service.

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The written WSJ interview with Xi Jinping ends with a quote used by Jinping from Chinese philosopher Mencius- "It is only natural for things to be different." Jinping couples it along with another old Chinese saying for a broader meaning- respect your own cultural values and differences, yet be open to outside exchanges if you don't want to end up being ignorant. That quote is: " Learning alone without exchanges with others will lead to ignorance." This focus on outside exchanges seen as technological cooperation so that China has access to western technology to continue its progress in modernization and growth, is something most developing countries accept as critical. Is it seen as broader by learning from the general experience in many fields of other countries in Europe, the Americas and Asia?

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Orlik cites a 2011 survey from China's South Western University of Finance and Economics, which surveyed 8000 households and found that 55% of Chinese households had little or no savings for that year. 10% of households control 86% of wealth and 56% of household income. Surveys in 1995 and 2002 showed 10% of households controlled 31% and 41% of wealth. In the U.S. top 10% of households control 74% of the wealth, according to the Federal Reserve figures. What this means, says Orlik, is that before China can shift to consumption based growth the low incomes of the majority of households have to go up, requiring a major policy shift. Under current policies and even with movement in the direction of the DRC/World Bank policy report for China for a gradual shift away from state owned enterprises, there is little prospect for rebalancing the world economy.

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In addition to the efforts by protests to preserve Hong Kong's special autonomous status, there is a protest by students "Occupy Central," similiar to the "Occupy Wall Street" protests. That aspect of the protest is aimed less at Beijing than at the financial establishment in Hong Kong. Because of its role as financial capital in Asia a lot is at stake for the U.S., Britain, and for China itself, in preserving the special role that Hong Kong has enjoyed for two decades since 1997 transfer from Britain. That independent role and separate status is needed for a world financial centre and access to the best human resources.

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Areddy describes the choices facing China's president Xi Jinping as he faces protests in Hong Kong demanding the resignation of Chief Executive Leung Chun-ying. Protestors are also calling for canceling of a plan to limit nominations for chief executive to a committee loyal to Beijing. Xi Jinping has experience with Hong Kong affairs as he held the portfolio for Hong Kong affairs as part of the leadership when he was vice president. There are precedents where Beijng has changed course, as it sees it important to put memories of Tiananmen protest suppression behind. In 2003 six years after Britain handed Hong Kong to China -under an agreement for "one country, two systems," that granted separate status and system of government to Hong Kong- an anti-subversion law was pulled back. And the unpopular Chief Executive Tung Chee-hwa, a shipping magnate, resigned after 18 months. Beijing has to balance its concern for the "contagion effect" of protests on other parts of China, with the need to maintain the right climate for business and investment in Hong Kong and other financial centres. With slowing growth and limits to overexpanding credit, a crackdown in Hong Kong would further exacerbate problems with the international community, and create tensions in Taiwan about future reintegration with China. China warned foreigners not to interfere, and the American Consulate in Hong Kong stated it "strongly supports Hong Kong's well-established traditions and Basic Law protections of internationally recognized fundamental freedoms, such as freedom of peaceful assembly, freedom of expression and freedom of the press." The British government also pointed to Hong Kong's "fundamental rights and freedoms, including the right to demonstrate," which were in the spirit of the 1997 transfer agreement....

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Easwar Prasad, Cornell University economist, and a former head of the IMF's China division, says the new report by the World Bank and the Development Reform Commission (DRC), is part of an effort by government officials in China to push the agenda for change forward during the transition to a new leadership. This includes Premier Wen. There is pushback from large state enterprises. The DRC and the World Bank had called for a change from the current situation to allow more private sector involvement in the economy, which means restricting the growth of the large state owned companies and letting the private sector operate in more parts of the economy. The alternative is to see growth slowing quickly and -some economists- say suddenly without warning. The role of Zhu Rongji, a former prime minister during the period Jiang Zemin was president, in pushing for changes appropriate to the period, is also cited. The last decade under prime minister Wen Biao is seen as one in which China relentlessly pursued its currrent export led model of development with large state run companies and state run banks dominating the economy. This has made change even harder to achieve because of the pushback to preserve the status quo....

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The political risk in China as the change of leadership takes place in 2012, and with the removal of Chongqing party chief Bo Xilai. The slowing of manufacturing activity and slowdown in growth expected in 2012-2014. Export growth declines to 6.8% from 14.2% in the fourth quarter of 2011. Quarterly surveys by the central bank shows demand for loans is dropping. And the HSBC purchasing managers index shows a reading of 48.1 in March, declining from 49.6% in February, showing shrinking manufacturing activity in China- anything less than 50 means contraction is taking place.

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China's economic planning agency, the National Development and Reform Commission, has approved $156 billion in new infrastructure projects, new subways, highways and other projects in recent weeks. The response is more carefully planned than the stimulus projects in 2009-2010, which are now seen as excessive response creating the prospect of bad loans in the banking system and causing inflation. The stimulus spread over 2 years, 2009 and 2010, was by government's initial estimates about 4 trillion yuan and this does not include additional local government spending as the government encouraged spending. This time the stimulus is about 1 trillion yuan or $158 billion, 2% of GDP, spread over 4 years, with projects going through careful review, according to Nomura economist Zhang Zhiwei. The Chinese government wants to avoid losing gains made in controlling a property bubble and holding down inflation.

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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.

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It is not clear how China's president Jinping's support for the idea of "China Dream," -of China as a world power on a level with the U.S.- should be interpreted. China will increase its defense budget and continue its efforts to be the dominant power in its region, even as the U.S. and Japan begin to build closer ties in the Pacific. Is it simply a new assertiveness for its rights in relation to territorial disputes with Japan, and a continuation of a policy of peaceful development of earlier leaders. The move could also be an effort to build close ties with the military as the new leadership of Jinping-Keqiang prepares to make major changes in the economy. A speech in Dec. 2012 to Communist party officials in Guangdong province by Jinping, on how the lack of unity with the military led to the collapse of the Soviet Union under Gorbachev, could throw light on the thinking. In a few days an old party was gone, as he put it. This also follows the Bo Xilai episode which involved contacts with the military and the risks of division in the military and political leadership....

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Su Liping, professor at Tsinghua Unversity, says there were 180,000 protests, riots and other incidents, protesting economic injustice in 2010. Most of the incidents were against land grabs, corruption and abuses by local officials, and unpaid wages. Inflation has hit the poor, migrant workers and people with low incomes hardest. Food prices were up 13.4% in August over the same month prior year. Pork prices were up 52.3%. Other problems are now meshed in with inflation. Local government debt in China, according to the National Audit Office, was 10.7 trillion yuan in June 2011. The National Audit Office estimates 23% of this, or 2.5 trillion yuan, depends on land for repayment. Analysts say China's local government made repayment in 2010 using the 2.9 trillion yuan in revenue from land sales. The same amount of land has to be sold in 2010 to make repayment. At lower prices even more land may have to be sold. The danger say Orlik and Jie, is that inflation and the pressure to acquire more land- and consequently more land grabs- will pose severe risks to the social contract in China....

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In an interview with the Wall Street Journal, Mark Carney, the head of Canada's central bank and the head of the Financial Stability Board, says China is falling behind in its earlier committments made at G-20 meetings to move towards rebalancing the world economy. He pointed to the fact that consumption in China has moved from about half of China's GDP to about a third, in the last ten years. China's investment has also declined from half of GDP to about one third. Carney also raised concerns about the strength of the Canadian dollar for Canada's competitiveness. The report "China: 2030" by the World Bank and China's Development Reform Commission also calls for changes in the way China's economy has increased its dependence on state run companies.

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Hong Kong's new chief executive, Leung Chun-ying, is intervewed by the WSJ's Te-Ping Chen, Jeffrey Ng, and Robert Thomson. He was elected by 1200 business and political leaders in 2012. The term ends in 2017, by which time China says it will hold direct elections with universal suffrage in Hong Kong. Leung plans pro-growth policies and says Hong Kong's growth rate of about 4% for the last two decades lags too far behind Singapore's over 6% growth rate. No action is planned to reduce property prices by providing new land supply. He sees more room for growth in maritime insurance and ship financing services to complement Hong Kong's development as a global shipping center, citing London as an example. To improve the problem of cramped housing space and small apartments he is looking at ways to build new towns in the New Territories, which are on the border with mainland China. Leung will not change Hong Kong's flat tax structure, and is not going to follow Singapore's example in granting tax holidays. Growth in China will be about 7% in 2012, and future growth will depend on how fast China shifts from export led growth to domestic consumption....

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Farmer resisting a land grab in Zhejiang province is runover by a truck. The gruesome scene of the accident appears on the internet in China and thousands of people viewing the picture accuse local government officials of silencing Qian Yunhui. In 2004, the city government approved construction of a power plant in Zhaiqiao Village. The company building the plant was given most of the best land in the village, with the 4000 villagers receiving no compensation, according to a blog post on Tianya, a popular online forum for discussing Chinese social issues. Mr Qian, the former communist party representative in the village went to Beijing to file a petition with the central authorites. Mr Qian was arrested and imprisoned twice. The incident ocurred after he was released from prison. The significance of the incident lies in the fact that land grabs have become common in China.