Chinese Economics Thread

[PanAsian]

Seems like this is the most appropriate thread for this post.

Hopefully this development does not mean there is less interest in mutual understanding between Americans and Chinese as people. Continued mutual interest in at least tourism is a good sign.

The article is a bit vague about its statistics and comparisons at times. Wonder what the stats are for US students in degree programs in China as well as Chinese students in exchange programs to the US.

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U.S. students losing interest in China as dream jobs prove elusive
BY ALEXANDRA HARNEY
SHANGHAI Thu Mar 12, 2015 5:15pm EDT

(Reuters) - American students are getting cold feet about studying Chinese in China, with many study abroad programs in the country seeing a substantial drop in enrolment over the last few years.

At the University of California Education Abroad Program (UCEAP), student enrolment in programs in China is expected to be less than half the level it was only four years ago. Washington-based CET, another leading study abroad group, says interest in China has been falling since 2013.

The apparent waning of interest worries some China watchers. Given the importance of the U.S.-China relationship, having a group of Americans across different industries who speak Chinese and understand the culture is "a matter of national interest", says Robert Daly, director of the Kissinger Institute on China and the United States at the Wilson Center in Washington.

"We can't respond coherently, effectively and fully to China unless we understand China on its own terms," he said.

The Institute of International Education says the number of U.S. students studying in China fell 3.2 percent in 2012-13 to 14,413, even as overall study abroad numbers rose modestly.

American students' apparent loss of interest contrasts with Chinese students' clamor for a U.S. education. The number of Chinese studying in the United States jumped 16.5 percent in 2013-14 to more than 274,000.

LESS NEED FOR FOREIGNERS

For U.S. students, China's notorious pollution is a concern. Job opportunities are another. As multinationals in China hire mostly local Chinese, a growing percentage of whom have studied abroad, they have less need for foreigners who speak Chinese.

"I came to China thinking I could learn Chinese and get a high paying job. I learned very quickly that was not the case," said Ian Weissgerber, a 25-year-old American graduate student in China. "A lot of Chinese can speak English just as well as I can, and Chinese is their native tongue too."

Gordon Schaeffer, research director at UCEAP, says surveys suggest the decline in study abroad programs in China might also reflect students' migration to science and technology majors, where courses need to be taken in sequence.

Some study abroad executives say a move toward more direct enrolment in Chinese universities could also, in part, account for fewer students taking traditional programs that typically offer a summer or semester overseas.

Wang Huiyao, president of the Center for China and Globalization and the author of a report on foreign students in China, says there are too few agents in the United States bringing students to China to study, and bemoans the U.S. government's inability to force universities to send more American students there.

NO PAY-OFF?

When students do come to China, they are increasingly coming for shorter periods of time, and often for trips that involve more travel than language study, study abroad executives say.

After a burst of enthusiasm a decade ago, interest in learning Chinese appears to be waning among U.S. students.

Enrolment in entry level Chinese is almost half the level of 2007 at Middlebury College, a private liberal arts college in Vermont renowned for its language instruction.

Last year's total Chinese enrolment was "the lowest in a decade", said Professor Thomas Moran, chair of Middlebury's Chinese department.

Between 2002 and 2006, Chinese language study at U.S. institutes of higher education leapt 50 percent, according to the Modern Language Association (MLA); it grew a further 16 percent between 2006 and 2009.

But from 2009 to 2013, growth in enrolment had slowed to just 2 percent, an MLA study released last month shows.

Enrolment in all foreign language courses at U.S. higher education institutions fell 6.7 percent between 2009 and 2013, according to the MLA study.

"It really comes down to money," says John Thomson, a veteran China study abroad executive. "You're taking yourself out of the job market for a couple years to study an extremely difficult language with no guaranteed pay-off at the end."

(Reporting By Alexandra Harney; Additional reporting by Shanghai newsroom; Editing by Alex Richardson)

 

[solarz]

It's easy - Germany or France risk nothing while South Korea risks more and more of Chinese economic policy influence which they won't be able to counter into it's own turf. What's wrong with that?

Being amazed by that is amazing for me.

Sorry, but it doesn't sound like you know what you're talking about. The AIIB is for financing infrastructure, its influence lies in the ability to decide which projects get financed, and which ones don't. Sitting it out would give you no leverage against its economic policies, while being a part of it will.

 

[Franklin]

Seems like this is the most appropriate thread for this post.

Hopefully this development does not mean there is less interest in mutual understanding between Americans and Chinese as people. Continued mutual interest in at least tourism is a good sign.

The article is a bit vague about its statistics and comparisons at times. Wonder what the stats are for US students in degree programs in China as well as Chinese students in exchange programs to the US.

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The most interesting part of the article is that more and more positions in China that use to be held by foreigners are now being filled by Chinese. This shows you that the level of education is improving in China. And that they are fast learners that the locals can take over the specialized workload from the foreign employees.

 

[PanAsian]

The most interesting part of the article is that more and more positions in China that use to be held by foreigners are now being filled by Chinese. This shows you that the level of education is improving in China. And that they are fast learners that the locals can take over the specialized workload from the foreign employees.

Actually the article says Chinese companies are hiring locals, an increasing number of whom have studied abroad, so among both Chinese companies and students an education abroad probably still has its cachet. Then again this is one of the vague points in the article where there probably isn't enough information to say one way or the other, just makes me want to see the full set of statistics.

 

[broadsword]

China Boosts Solar Target for 2015 as It Fights Pollution

China raised its solar target for 2015, promising to add almost 2.5 times as much capacity as the U.S. added last year, as it races to clear its increasingly polluted air.

The world’s biggest emitter of carbon aims to install as much as 17.8 gigawatts of solar projects in 2015, the National Energy Administration said today on its website. The NEA previously estimated 15 gigawatts would be added this year, according to a person familiar with the matter, who asked not to be identified, citing confidentiality requirements.

 

[AssassinsMace]

To what I understand about how AIIB serves an economic gain for members is being awarded contracts to build infrastructure. If there's a country that does receive a loan to build infrastructure and doesn't have the skills nor the means to build the infrastructure themselves, someone is going to be contracted to do it for them. That's why you see comments like when the British jumped in that it was an economic opportunity. The IMF and World Bank don't deal with infrastructure directly themselves. They're literally like a bank just giving out loans and if there's any monetary gain it would be from interests but no individual country gains from it. In a way there's going to be more regulation and oversight with AIIB unlike just being given a loan which can be squandered by a government.

 

[AssassinsMace]

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Hostility From U.S. as China Lures Allies to New Bank
By

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MARCH 19, 2015

BEIJING — When Xi Jinping, then the newly minted Chinese leader, first broached the idea of a new Asian development bank in a public speech in 2013, few in Washington paid it much heed.

But as Beijing systematically recruited longtime American allies to help fund and oversee the new bank, it became clear that the push was more than a public relations gesture to

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’s Asian neighbors. It was also a direct threat to the post-World War II financial institutions led primarily by the United States, and to President Obama’s pledges to make a “pivot” to Asia in American foreign policy.

Now with Britain, France, Germany and Italy

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, despite direct pleas from Washington to steer clear, the question is whether the Obama administration mishandled a significant challenge from

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, and what it might have done differently.

“The administration made a major mistake in its opposition. It was a very shortsighted,” said Paul Haenle, director of the Carnegie-Tsinghua Center in Beijing. “The bank was going to go ahead whether we supported it or not.”

The United States would have been wiser, he and others said, to temper its resentment of China’s efforts to raise its international profile and play a bigger role in global financial affairs. Some argue it may also have sought to play a role in an Asia-focused bank led by China, just as Washington expects China to contribute more to the World Bank and the International Monetary Fund, the Washington-based lending agencies for development and monetary stability.

The willingness of Britain to join the China bank over American objections was an especially clear sign of China’s sophisticated strategy for winning friends, and Washington’s failure to respond effectively.

The British chancellor, George Osborne, had made clear his desire to change Britain’s attitude toward China. The Chinese knew that he wanted to make London a platform for overseas business transacted in Chinese currency, a first step to the convertibility of the renminbi. Just two weeks after Mr. Xi’s speech on the bank, which the Chinese leader delivered in Indonesia, Mr. Osborne visited Beijing, where the courting began.

The confluence of Chinese and British interests led to Mr. Osborne’s announcement last week that Britain would become a founding member of the bank, the Asian Infrastructure Investment Bank. American opposition was made clear, but most likely came late in the process.

The British decision cleared the way for other European allies that China had courted to go Beijing’s way, as well. Australia is expected to sign up in the next week, according to government officials, and South Korea is likely to follow.

Speaking of Britain, an angry senior administration official told The Financial Times that the decision to join the bank was one more sign of “constant accommodation” of China.

One problem is that Washington did not offer much of an alternative to China’s call to inject far more funding into building roads, railroads and pipelines around Asia, much of which remains underdeveloped. There is little dispute, Mr. Haenle said, that the World Bank and the Asian Development Bank have been unable to fulfill the infrastructure needs in the region.

“But there is a strain in Washington that if the U.S. is not in the lead, then the U.S. should not be part of it,” he said.

Early on, the United States should have realized that China was determined to create the bank, and that Washington should have tried to influence its creation rather than block it, analysts in Washington and Asia said.

China was upset that after the 2008 financial crisis, Congress rebuffed legislation intended to increase Beijing’s voice in the World Bank and the International Monetary Fund. Now that China was sitting on more than $3 trillion in foreign exchange reserves, Beijing could easily afford to finance an entirely new institution that would have a majority Chinese stake with other countries as minority shareholders, they said.

Moreover, China had decided that it wanted to use its excess capacity in steel, concrete and pipes to build up neighboring economies and benefit the Chinese economy, said Laurence J. Brahm, an American who worked with Prime Minister Zhu Rongji on China’s entry to the World Trade Organization in 2001.

“China’s economy will benefit from the export of its own labor to build the infrastructure in the region,” he said.

That China would use the bank for its own pet projects in Asia and try to knit together the poorer countries of Southeast and Central Asia into an economic sphere of influence was one of the main worries in Washington.

Even so, the administration could have adopted a positive approach. It had the option of agreeing that investing in infrastructure was needed in Asia, and that China, flush with cash, had the ability to fill the gap, said Matthew Goodman, senior adviser on Asian economics at the Center for Strategic and International Studies.

From that more supportive position, Washington would have been in a better position to try to shape the new bank’s rules on lending, the environment and transparency, he said.

China’s Finance Ministry has told prospective members that it will strive to make the new bank a first-class operation that will manage to deliver projects more efficiently than the World Bank or the Asian Development Bank.

To that end, the Chinese have asked a lawyer who worked at the World Bank for over 30 years, Natalie Lichtenstein, to help prepare the bank’s charter. Such people are important to the bank’s success, said Fred Hu, the founder of Primavera Capital, a private equity firm in Beijing, who early in his career worked at the World Bank.

“The last thing China and A.I.I.B. needs is that some of the fears expressed by Washington are validated,” he said. “Attracting world-class talent is absolutely crucial.”

And mindful of reputation, the Finance Ministry has deflected an interest in bank membership from Iran, saying it might consider Iran in a second round, but not as a founding member.

No matter how the bank shaped up, it was highly unlikely that the United States would be a member. That was an unfortunate situation, said an Asian diplomat whose country is a founding member.

“The truth is no one in the region wants to choose between the United States and China,” he said. But Washington’s hostility to the bank, he said, made countries choose in China’s favor.

 

[broadsword]

Political considerations aside, joining AIIB right off the bat is a no brainer. China will be the multiplier with its financial muscle and lower cost.

 

[AssassinsMace]

Everyone remember this when people talk about tainted products from China.

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In the video they say they don't know where the arsenic is coming from. Living near Napa Valley the local regional news has explained where the arsenic is coming from. It's a short-cut process (sound familiar) where the wine makers add wood chips to turn the wine into the color they want. That's apparently a major source of where this arsenic is coming from.

 

[AssassinsMace]

Political considerations aside, joining AIIB right off the bat is a no brainer. China will be the multiplier with its financial muscle and lower cost.

The irony is this is the very same system that is criticized when China invests into other countries like in Africa. A model that has shown it works. Now you have the critics joining in. So what was wrong with it in the first place?