China’s 2012 Economic Growth Estimated At 8.1%

The above article is in the online edition of the Bloomberg News 21 August 2012. I seldom comment on news publications due to the absence of references or supporting research findings.  This article fell into a range of exceptions due to the comments of Professor Li, Tsinghua University, Bejing.  Having just completed an immersion study of China's social, political, legal, intercultural, technology & infrastructure I offer the following observations pertaining to Zhou Xin, Scott Lanman, and Patrick Harrington's article on the subject. 

An Alternative Worldview - Risk

China’s ability to control expansion is excellent news in the context of global priorities. This position could be shared by a select group of Western economist.  Research we have developed indicates China’s growth should be held to a high of 8 percent.  If China can control its expansion, we would suggest the success lead to the execution of a gradual reduction during its five year plan to 5 percent or lower. Why?

An Eastern Economic Alternative - Opportunity

We argue this would slow inflationary influences internally to China and externally within the global community.  China’s current demands on global resources are overwhelming.  This is especially true within those regions where resources are readily available and transportable to China.  Professor Li’s concerns as stated “showing China’s slowdown at risk” would appear to be a somewhat westernized worldview of the economy.  We would encourage an extended review focused on slowing China’s economic expansion.  We suggest this in light of potential opportunities and benefits related to easing the global community’s financial crisis.  China may wish to consider extending its external economic focus by growing the economic interests of the global community.  China is presently in a unique position to stimulate “real product and infrastructure development” externally that could serve its interests in the long run.  Applying its financial strength to its troubled trade partners could lead to positive returns on investment within this community for decades into the future.  China’s investments in these economies could assist in strengthening its trade partners which would in turn yield an increase its external trade.

Encouraging Protective Laws - Promoting Business Investments

China’s professor Li is right when he speaks to China addressing changes in intellectual and property laws.  After researching this issue in China, the findings indicated progress here will be slow considering these changes go against a culture tested by tradition. 

PD Huff, Research Operations Director, The Clayton Research Consultancy, Los Angeles, CA

Article follows:

By Bloomberg News - Aug 21, 2012 1:38 AM PT

Former PBOC Adviser Li Sees China’s 2012 Economic Growth At 8.1%

China’s economy will expand by more than 8 percent this year as growth rebounds from a six-quarter slowdown, said Li Daokui, a former central bank adviser.

Full-year expansion will be 8.1 percent and fourth-quarter growth may exceed 8.5 percent, Li, who was an academic member of the People’s Bank of China monetary policy committee until March, said in an interview today before speaking to a forum in Beijing.

Li’s comments compare with data this month showing China’s slowdown at risk of extending into a seventh quarter, after export growth slowed in July and industrial production and lending missed economists’ forecasts. Li said China should loosen policies further, including lowering the reserve- requirement ratio for banks.

“A big problem at present is the weak investment from the corporate sector, and China has to do more to encourage corporate investment,” said Li, a professor at Tsinghua University in Beijing.

--Zhou Xin. Editors: Scott Lanman, Patrick Harrington

To contact Bloomberg News staff for this story: Zhou Xin in Beijing at xzhou68@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst at ppanckhurst@bloomberg.net