Podcasts about gavekal dragonomics

The world's top economic and financial authorities descend on Washington this week for the IMF/World Bank Spring Meetings. The focus this year is overwhelmingly on trade, as US President Donald Trump's reciprocal tariffs hang over the event. And nowhere are levies more painful than in China, where the highest rates threaten economic growth. Arthur Kroeber, founding partner of research consultancy Gavekal Dragonomics and author of China's Economy: What Everyone Needs to Know, joins Katia Dmitrieva in Washington for a discussion about the new trade era, China's economic travails and how the trade stalemate with the US could end.See omnystudio.com/listener for privacy information.

In this episode of Pekingology, Freeman Chair in China Studies Jude Blanchette is joined by Andrew Batson, China Research Director at Gavekal Dragonomics to discuss his recent blog post entitled “Xi's New Growth Synthesis.” He also publishes The Tangled Woof blog, and wrote the enlightening post “Some Cadres Cannot Keep Up.”  

In a bid to strengthen ties with Western nations, Xi Jinping has issued a stern warning against "decoupling" from China's economy. He urged leaders to view China's development as an asset, not a threat. Nevertheless, official data reveals a sharp decline in Chinese imports to the United States. In this podcast, Thomas Gatley, China Strategist at Gavekal Dragonomics, reflects on the situation in conversation with regular host, Duncan Bartlett.

In this episode of Pekingology, Freeman Chair in China Studies Jude Blanchette is joined by Thomas Gatley, China Strategist at Gavekal Dragonomics, to discuss his recent report “Reshaping Corporate China.” 

The US government is spending billions of dollars to build out state-of-the-art domestic semiconductor manufacturing capacity. But spending money is no guarantee of success. In fact, there are already worries that the CHIPS Act passed by the Biden administration isn't succeeding, due to various roadblocks, speedbumps and unforced errors. So what are the odds that it will pay off? And what should we be watching for as evidence of its efficacy? On this episode of the podcast, we spoke with Dan Wang, technology analyst at Gavekal Dragonomics and Adam Ozimek, chief economist at the Economic Innovation Group. This episode was recorded live at Decades, Adam's bowling alley in Lancaster, Pennsylvania, during the #EconTwitterIRL event in April.See omnystudio.com/listener for privacy information.

In just a few years, the narrative on China has almost completely flipped. The dominant sentiments in America had been awe, envy and a kind of fear. China's growth seemed relentless. Its manufacturing prowess was lapping ours. It weathered the pandemic without the mass death seen in the West. It could build housing and transit and infrastructure at a speed we could no longer even imagine.And then, as 2022 ticked over to 2023, things changed. China's real estate bubble popped. Its Zero Covid policies turned pathological. Its leader, Xi Jinping, turned what many saw as a technocracy with autocratic characteristics into something closer to a plain old autocracy. Foreign investors began looking to diversify. Companies that had long relied on China, like Apple, began trying in earnest to build manufacturing chains elsewhere. And under President Biden, American policy toward China began to match Trumpian rhetoric toward China: Slowing China's rise, and building America's ability to manufacture crucial goods, became central goals.So what's true about China right now? Which of these narratives, if any, hold water? Dan Wang is the technology analyst at Gavekal Dragonomics and a visiting scholar at Yale Law School's Paul Tsai China Center. He focuses particularly on the core vector of U.S.-China competition: technological innovation and manufacturing prowess. Each year, his annual letter about what China can do, and how it does it, is eagerly awaited by many in the United States who are trying to understand that nation's rise. In 2020 and 2021, those letters were profoundly bullish on China. In 2022, his sentiments turned. And so I wanted to explore the various sides of the China story with him.Mentioned:“China's Hidden Tech Revolution” by Dan Wang2020 Letter by Dan Wang2021 Letter by Dan Wang2022 Letter by Dan WangBook Recommendations:The Jesuits by Markus FriedrichLast and First Men by Olaf StapledonDisturbing the Universe by Freeman DysonThoughts? Guest suggestions? Email us at ezrakleinshow@nytimes.com.You can find transcripts (posted midday) and more episodes of “The Ezra Klein Show” at nytimes.com/ezra-klein-podcast, and you can find Ezra on Twitter @ezraklein. Book recommendations from all our guests are listed at https://www.nytimes.com/article/ezra-klein-show-book-recs.“The Ezra Klein Show” is produced by Emefa Agawu, Annie Galvin, Jeff Geld, Roge Karma and Kristin Lin. Fact-checking by Michelle Harris and Kate Sinclair. Mixing by Efim Shapiro. Original music by Isaac Jones. Audience strategy by Shannon Busta. The executive producer of New York Times Opinion Audio is Annie-Rose Strasser. Special thanks to Pat McCusker and Kristina Samulewski.

The Chinese government's biggest political gathering comes at a time of numerous challenges.Next week will see a major gathering of China's top officials known as the National Congress of the Chinese Communist Party. This event only happens twice every decade, and this particular Congress is happening at an extraordinary time for both the Chinese government and the country. Not only are officials grappling with the impact of strict pandemic-related restrictions known as Covid Zero, but they're also facing turmoil in the economy and the real estate sector. At the same time, external pressures are picking up, with the US recently imposing sweeping curbs on the way semiconductor companies do business with China. So what's on the agenda for this major political event and what can it tell us about the future direction of the Chinese economy? Dan Wang, China technology analyst at Gavekal Dragonomics, joins us to discuss.See omnystudio.com/listener for privacy information.

China and Germany found many reasons to be friendly in the aftermath of the Cold War. China cited the economic advantages to both countries as a win-win situation. Three decades later, relations between the two states have become increasingly tense. Chancellor Olaf Scholz takes a much more hawkish line on China than his predecessor Angela Merkel and Germany has even sent a warship to Asia, to patrol near Taiwan. In this podcast, Yanmei Xie, a geopolitical analyst at Gavekal Dragonomics, offers her analysis of the changing relationship and its implications for business. The podcast host is Duncan Bartlett, Editor of Asian Affairs.

Kịch bản khủng hoảng tín dụng địa ốc tái diễn, nhưng lần này là tại Trung Quốc ? Thị trường bất động sản bên bờ vực thẳm : 80 tỷ đô la trị giá cổ phiếu bốc hơi. Các tập đoàn tên tuổi trong ngành địa ốc lần lượt tuyên bố vỡ nợ. Hàng trăm ngàn người « nổi dậy » ngừng tiếp tục góp tiền « nuôi » ngành xây dựng. Ngân Hàng Trung Ương chuẩn bị lập quỹ hỗ trợ lĩnh vực bất động sản cao gần gấp 4 lần so với dự tính ban đầu. Vào lúc 2 trong số 3 đầu máy tăng trưởng của nền kinh tế thứ 2 toàn cầu là xuất khẩu và đầu tư nước ngoài đã bị « hỏng », Bắc Kinh bằng mọi giá phải tránh nguy cơ thị trường bất động sản sụp đổ. Trước Đại Hội Đảng vào mùa thu 2022, khủng hoảng nhà đất sẽ là một tai họa về mặt kinh tế và xã hội tại một quốc gia mà ngành địa ốc và xây dựng đem về đến 25 % cho GDP. Địa ốc: Bắc Kinh sợ phỏng tay ?  Hãng tin Anh Reuters ngày 25/07/2022, trích dẫn một quan chức thuộc Ngân Hàng Trung Ương Trung Quốc xin được giấu tên, cho biết Bắc Kinh « dự trù nâng quỹ hỗ trợ bất động sản lên 300 tỷ nhân dân tệ, tương đương với 44 tỷ đô la Mỹ, thay vì 80 tỷ như đã thông báo cách nay vài tuần ». Trước đó, hôm 17/07/2022, Ủy Ban Điều Tiết Bảo Hiểm và Ngân Hàng Trung Quốc đã kêu gọi « mở van tín dụng », « cứu » ngành xây dựng và các các công ty môi giới bất động sản. Giới quan sát xem đây là một tín hiệu mới cho thấy chính quyền Tập Cận Bình thực sự không còn dám lơ là : thị trường địa ốc Trung Quốc trong cảnh « dầu sôi lửa bỏng ». Từ đầu năm đến nay, Bắc Kinh đã hai lần hạ lãi suất ngân hàng, khuyến khích tiêu thụ, một số chính quyền địa phương trợ cấp cho các hộ gia đình mua nhà, đặc biệt là mua nhà mới trên dự án. Nhưng những biện pháp đó vẫn chưa đủ để xua tan mối đe dọa khủng hoảng. Trên đài RFI Pháp ngữ, chuyên gia PhápJean - François Di Meglio, chủ tịch trung tâm nghiên cứu về châu Á, Asia Centre, trụ sở tại Paris, trước hết lưu ý, Trung Quốc đang trải qua nhiều cuộc khủng hoảng cùng lúc và Covid-19 là cột mốc quan trọng : « Trung Quốc đi trước thế giới trong cuộc khủng hoảng y tế do virus xuất phát từ quốc gia này và như vậy đã có một sư chuẩn bị nào đó để đối phó với dịch. Kế tới, mọi người đã tưởng Bắc Kinh làm chủ được tình hình. Đặc biệt là vào thời điểm kinh tế Trung Quốc nhanh chóng lấy lại thăng bằng trong cả năm 2020 và 2021, khi mà cả thế giới còn lao đao. Bước sang mùa xuân năm nay, tình thế đã thay đổi : Trung Quốc đội bảng, trong lúc mọi nơi khác đã hoạt động lại gần như bình thường. Đà phục hồi của Trung Quốc bị chậm so với phần còn lại của thế giới ». Trong một bài tham luận gần đây, François Godement, cố vấn của viện nghiên cứu Montaigne Paris đã nói tới tình cảnh « Trung Quốc bị hỏng hai đầu máy tăng trưởng » : đầu tư nước ngoài giảm mạnh từ năm 2020 do Bắc Kinh xây « vạn lý trường thành » y tế, cách ly với thế giới bên ngoài để chống dịch Covid-19. Xuất khẩu là đầu máy thứ nhì bảo đảm đem về tăng trưởng cho quốc gia 1,5 tỷ dân này, nhưng ngay cả đầu máy đó cũng bắt đầu có dấu hiệu bị chựng lại. Jean - François Di Meglio phân tích : « Nguyên nhân thứ nhì gây lo ngại là, dù muốn hay không, kinh tế toàn cầu cũng bị chựng lại vì chiến tranh Ukraina. Cần biết rằng, đến nay, đà phục hồi của Trung Quốc sở dĩ vững vàng, trong suốt năm 2021 và cho đến tận những tháng đầu của năm 2022 là nhờ vào xuất khẩu. Xuất khẩu kéo kinh tế Trung Quốc đi lên. Thặng dư mậu dịch thậm chí đạt kỷ lục, vì thế giới cần hàng Trung Quốc, trong lúc mà nhập khẩu có phần giảm sút vì GDP tăng chậm lại. Giờ đây, do tác động chiến tranh, nếu như con tàu kinh tế của thế giới chựng lại, các nhà sản xuất Trung Quốc sẽ bị vạ lây : nhập khẩu của thế giới giảm sút sẽ làm hỏng đầu máy tăng trưởng của Trung Quốc ». Còn lại cột trụ thứ ba là tiêu thụ nội địa của nước đông dân nhất địa cầu. Nhưng ngay cả đầu máy còn lại này cũng đang bị các đợt phong tỏa liên tiếp nhắm vào hàng chục triệu người dân Trung Quốc đe dọa. Địa ốc là một trong những nạn nhân trực tiếp. Theo thẩm định của Gavekal Dragonomics, một cơ quan phân tích có trụ sở tại Bắc Kinh, có khoảng 100 triệu căn hộ do các nhà đầu cơ làm chủ tại Trung Quốc đang bị bỏ trống, 30 triệu khác do các công ty môi giới nắm giữ. Thị trường bất động sản Trung Quốc tuột dốc trong trong 12 tháng liên tiếp. Tháng 6/2022 giảm 43 % so với một năm trước đây. Có từ 5% đến 25 % các căn hộ bị bỏ trống. Có đến 24 trong số các tập đoàn lớn nhất trong ngành tại Trung Quốc bị đe dọa « mất khả năng thanh toán », theo thẩm định của hãng tin Mỹ, Bloomberg. Trên toàn quốc, có từ 5% đến 20 % các công trình bị bỏ dở, vì các chủ thầu thiếu tiền mua vật liệu, thiếu tiền trả cho công nhân … Sau Evergrande hồi tháng 9/2021, mùa hè năm nay đến lượt tập đoàn Shimao, trụ sở tại Thượng Hải, mất khả năng thanh toán 1 tỷ đô la Mỹ nợ đáo hạn và phải cấp tốc tìm ra thêm 2 tỷ đô la nữa để thanh toán cho các chủ nợ từ nay đến cuối năm. Evergrande, Shimao hay Sunak … là 3 trong số 6 đại công ty bất động sản Trung Quốc, vừa bị khai trừ khỏi bảng yết giá trên sàn chứng khoán Hồng Kông vì không công bố đúng thời hạn tổng kết tình hình tài chính năm 2021. Đem tỏi và dưa hấu đi mua nhà Họa vô đơn chí, hàng trăm ngàn thân chủ của 80 công ty môi giới bất động sản trên toàn quốc « nổi loạn » tuyên bố ngừng thanh toán các khoản trả góp cho tới khi nào họ được giao nhà. « Phong trào » đã lan rộng tới gần 100 tỉnh thành, liên quan đến hơn 300 công trình đang xây dựng nửa chừng. Thái độ phản kháng từ phía người trả góp những căn hộ mua trên dự án đẩy giới trong ngành vào cảnh thiếu hụt hơn 300 tỷ đô la. Ngành xây dựng, giới chủ thầu và cã hãng môi giới bất động sản tuyệt vọng tới nỗi, sau khi đã rao bán nhà và tặng không một chỗ đậu xe trong chung cư, hay lắp máy điều hòa miễn phí … ở tình Hà Nam chẳng hạn, một số công ty cho phép khách hàng « trả góp » bằng hàng trăm tấn tỏi, hay dưa hấu. Chủ tịch trung tâm nghiên cứu về châu Á, Asia Centre nhắc lại : « Hiện tượng tất cả các tập đoàn môi giới nhà đất nợ nần chồng chất đã lộ rõ kể từ vụ Evergrande và bắt đầu được phơi bày ra ánh sáng cách nay khoảng 9 tháng. Dân Trung Quốc đã ưu tiên đầu tư vào địa ốc, họ đua nhau đi mua nhà và đổ vào đấy tất cả tiền tiết kiệm. Cũng phải nói rằng đây là một trong những lĩnh vực duy nhất dân chúng có thể đầu tư. Từ 35 năm nay, giá nhà đất tại Trung Quốc không ngừng tăng lên. Nhưng rồi, thị trường đột ngột bị chựng lại, giá cả giảm sút. Tư nhân, những người mà từ trước đến nay dễ dàng đổ tiền vào để nuôi các công ty môi giới nhà đất và các đại tập đoàn xây dựng Trung Quốc, ngưng thanh toán. Người ta đòi ‘tiền trao, cháo múc'. Thế là cả một hệ thống đang hoạt động tốt, bị chựng lại. Các công ty môi giới lần lượt vỡ nợ, bởi vì tư nhân không muốn đầu tư vào địa ốc nữa ». Dập tắt phẫn nộ của giới trung lưu vướng nợ nhà đất Như vừa nói, giá nhà đất tại Trung Quốc đã liên tục tăng, và đã tăng đến mức chóng mặt, trong hơn ba thập niên qua. Đây cũng là phương tiện duy nhất để ai cũng có thể kiếm lời, là một loại bảo hiểm tài chính đáng tin cậy nhất của giới trung lưu. Cũng hãng tin Mỹ Bloomberg thẩm định, trung bình bất động sản chiếm khoảng 70 % tài sản của một hộ gia đình (không ít trong số đó tậu nhà để đầu cơ). Tỷ lệ này cao hơn rất nhiều so với tại Mỹ hay Châu Âu. Thị trường nhà đất mất giá, tài sản của tầng lớp này qua đó cũng « bốc hơi theo ». Như giáo sư Alfred Wu, đại học Lý Quang Diệu tại Singapore, nói : « Người Trung Quốc thường huy động vốn của cả một gia đình để đầu tư vào nhà đất. Nếu như căn nhà hay căn hộ của họ mất giá, thì đây là một vấn đề sinh tử ».  Trước Đại Hội Đảng Cộng Sản Trung Quốc tháng 11/2022, làn sóng phẫn nộ này bất ngờ bắt ông Tập Cận Bình phải phản ứng kịp thời,  để dập tắt mọi mầm mống bất mãn trong xã hội. Khủng hoảng tín dụng và thị trường bất động sản đe dọa trực tiếp đến cam kết xây dựng một xã hội « thịnh vượng chung » ông đã đề ra. Do vậy, tất cả các chuyên gia đều quả quyết là bằng mọi giá, Bắc Kinh phải duy trì « ổn định » vào lúc họ Tập có tham vọng điều hành đất nước thêm một nhiệm kỳ thứ ba - và có thể là giữ chức chủ tịch Trung Quốc mãn đời. Để đổi lấy sự « ổn định trong xã hội đó », Bắc Kinh phải làm gì ? Chuyên gia Di Meglio trả lời : « Sẽ có những quyết định đau đớn. Ở cấp cá nhân, một số người đã từ chối tiếp tục trả góp cho các nhà thầu. Điều đó có nghĩa là họ có thể mất trắng số tiền mà tới nay đã nộp cho các công ty môi giới. Ở cấp nhà nước, chính quyền không thể cứu hết tất cả các tập đoàn xây dựng và các công ty môi giới nhà đất. Họ buộc phải chọn ‘cứu ai, bỏ ai'. Có nhiều khả năng chính phủ sẽ cứu những hãng quá lớn, hay là tương đối còn có một chút khả năng tài chính để chống chọi với khủng hoảng. Với những tập đoàn mà thân chủ đã từ chối trả góp, thì có thể là nhà nước sẽ can thiệp, bù vào khoảng trống tài chính đó. Như vậy tiếp sức cho ngành địa ốc. Song vấn đề còn nguyên vẹn : hàng trăm, hàng ngàn tòa nhà cao tầng xây xong coi như là tài sản của các ngân hàng, nhưng giá trị của chúng là bao nhiêu khi mà thị trường địa ốc ách tắc, giá cả đổ dốc ? Kịch bản khủng hoảng tín dụng địa ốc, subprime ở Hoa Kỳ năm 2007 tái diễn ». Dù vậy giám đốc trung tâm nghiên cứu Asia Centre Jean-François Di Meglio không tin là khủng hoảng tín dụng địa ốc phiên bản Trung Quốc sẽ xảy ra, bởi vì « chủ trương cố hữu của Bắc Kinh là làm tất cả để cố gắng giữ một thế cân bằng nào đó, tránh để nổ ra khủng hoảng như ở Mỹ. Vụ subprime hồi 2007 ở Mỹ đã dẫn tới vụ Lehman Brothers. Rồi khủng hoảng tài chính này lan ra toàn cầu.Hoa Kỳ là một nền kinh tế mở rộng, ngành tài chính, các nhân hàng Mỹ liên hệ với toàn thế giới. Các ngân hàng Trung Quốc thì không, nhờ vậy khủng hoảng địa ốc hay tài chính Trung Quốc sẽ không tác động trực tiếp đến tài chính của thế giới ». Chuyên gia Pháp kết luận : Bắc Kinh có nhiều phương tiện để tránh một cuộc khủng hoảng kép từ thị trường địa ốc lan sang tài chính, ngân hàng Trung Quốc. Nhìn xa hơn, có nhiều khả năng Trung Quốc đi theo mô hình của Nhật : đầu thập niên 2000, Nhật Bản cũng đã trải qua một cuộc khủng hoảng địa ốc. Chính phủ đã can thiệp. Mất 20 năm, ngành địa ốc Nhật mới đi vào quy củ. Chưa thể nói là lĩnh vực này khởi sắc trở lại nhưng đã lấy lại cân bằng, và tình hình không đến nỗi tệ.

Le minerai de fer est en baisse et a retrouvé son niveau d'il y a six mois. En cause, une production chinoise d'acier qui s'est emballée alors que la demande ne suivait pas. En une semaine, le minerai de fer a perdu un quart de sa valeur pour atteindre son niveau de janvier dernier. La raison principale, c'est le ralentissement de l'activité chinoise. Et une demande du secteur immobilier qui n'a pas été à la hauteur des prévisions. Or il représente à lui seul près de 40% de la consommation d'acier - fabriqué à partir du fer -, en Chine. Le mois de mai aurait été particulièrement mauvais avec une baisse de plus de 30 % des nouvelles constructions, selon le Financial Times. Résultat, le prix des barres d'acier utilisées dans le secteur a chuté de 20 % pendant ce même mois. Ce qui a contribué à un effondrement des bénéfices des aciéries locales. Les aciéries chinoises ont surestimé la demande L'industrie sidérurgique chinoise a péché par excès d'optimisme, selon l'agence de presse économique Bloomberg. La production s'est accélérée alors que le Covid était en plein rebondissement. Elle est passée à plus de trois millions de tonnes par jour en avril et en mai, d'après les données de Gavekal Dragonomics une société de services et conseils financiers, alors qu'en janvier et février, elle était de deux millions et demi de tonnes par jour. Début juin, les aciéries tournaient toujours à plein régime, selon la même source. Mais depuis, certaines se seraient mises en pause. Les ventes de tôles pour automobile en baisse Cette volonté de produire coûte que coûte était un pari risqué et le contrecoup se fait aujourd'hui sentir. La surproduction est venue grossir les stocks des produits à base d'acier qui étaient déjà hauts en ce début d'année dans le pays. Le résultat ne pouvait se traduire que par une baisse des prix. En achetant 70 % des volumes de fer commercialisé, la Chine fait toujours la loi sur le marché. Un marché mondial qui est aussi marqué par une chute des ventes de tôles d'acier pour le secteur automobile.

An hour long discussion with Arthur Kroeber - founder of China focused Gavenkal Dragonomics research service - where we discuss short and longer term challenges of China's economy given both domestic structural change and big geopolitical shifts. Arthur covers the implications for multinational corporations and what adaptation strategies they need to think about to maintain business continuity and supply chains.Arthur R. Kroeber is a partner and head of research at Gavekal, a Hong Kong-based economic research firm, and founder of its China-focused Gavekal Dragonomics research service. Before establishing Dragonomics in 2002, he spent fifteen years as a financial and economic journalist in China and South Asia. He is adjunct professor of economics at the NYU Stern School of Business, a senior non-resident fellow of the Brookings-Tsinghua (Ching-Hua) Center in Beijing, a member of the Council on Foreign Relations, and a member of the National Committee on US-China Relations. His book China's Economy: What Everyone Needs to Know (2nd edition 2020) is published by Oxford University Press.

China regards its money as an ambassador to the world. It would like the yuan - or renminbi - to be held in just as much esteem as the euro, or even the US dollar; in other words, a truly global currency. Yet there are major barriers to the internationalisation of the renminbi, including its limited convertibility and China's cautious approach towards financial openness. Arthur Kroeber, a founding partner of Gavekal Dragonomics, offers his perspective in this conversation with podcast host, Duncan Bartlett.   China In Context: Episode 62 Broadcast date: 26 April, 2022

Our latest season of Tech Tonic continues, with a deep dive into the semiconductor industry and Taiwan's unique position as a bastion of computer-chip talent. James Kynge, the FT's global China editor, looks into the unintended consequences of the race for semiconductor dominance. We hear from Chad Duffy, a Taipei-based cybersecurity expert who helped uncover a major hack on Taiwanese semiconductor manufacturers. James talks to Dan Wang, an analyst with the Shanghai-based Gavekal Dragonomics, about China's chip strategy, and Stephen Orlins, a rare dissenting voice in Washington who questions the efficacy of a US blacklist of Chinese tech companies desperate for US-designed chips. Plus, Annie Ting-Fang and Lauly Li, who cover the semiconductor industry for Nikkei Asia, give us the inside track on how China has been scooping up Taiwanese semiconductor engineers.Check out stories and up-to-the-minute news from the FT's technology team at ft.com/technologyFor a special discounted FT subscription go to https://www.ft.com/techtonicsaleAnd check out FT Edit, the new iPhone app that shares the best of FT journalism, hand-picked by senior editors to inform, explain and surprise. It's free for the first month and 99p a month for the next six months.Presented by James Kynge. Edwin Lane is senior producer. Josh Gabert-Doyon is producer. Manuela Saragosa is executive producer. Sound design is by Breen Turner, with original music from Metaphor Music. The FT's head of audio is Cheryl Brumley.News clips credits: CNBC See acast.com/privacy for privacy and opt-out information.

Our latest season of Tech Tonic continues, with a deep dive into the semiconductor industry and Taiwan's unique position as a bastion of computer-chip talent. James Kynge, the FT's global China editor, looks into the unintended consequences of the race for semiconductor dominance. We hear from Chad Duffy, a Taipei-based cybersecurity expert who helped uncover a major hack on Taiwanese semiconductor manufacturers. James talks to Dan Wang, an analyst with the Shanghai-based Gavekal Dragonomics, about China's chip strategy, and Stephen Orlins, a rare dissenting voice in Washington who questions the efficacy of a US blacklist of Chinese tech companies desperate for US-designed chips. Plus, Annie Ting-Fang and Lauly Li, who cover the semiconductor industry for Nikkei Asia, give us the inside track on how China has been scooping up Taiwanese semiconductor engineers.Check out stories and up-to-the-minute news from the FT's technology team at ft.com/technologyFor a special discounted FT subscription go to https://www.ft.com/techtonicsaleAnd check out FT Edit, the new iPhone app that shares the best of FT journalism, hand-picked by senior editors to inform, explain and surprise. It's free for the first month and 99p a month for the next six months.Presented by James Kynge. Edwin Lane is senior producer. Josh Gabert-Doyon is producer. Manuela Saragosa is executive producer. Sound design is by Breen Turner, with original music from Metaphor Music. The FT's head of audio is Cheryl Brumley.News clips credits: CNBCRead a transcript of this episode on FT.com See acast.com/privacy for privacy and opt-out information.

This week on the Sinica Podcast, Kaiser welcomes back Dan Wang, technology analyst at Gavekal Dragonomics, to talk about this year's annual letter. Dan's letters have become something of an institution: wide-ranging, insightful, and always contentious, his missives are read by a great many observers of contemporary China and spark some lively conversations. This year's letter contrasts the major megacities that Dan has lived in (Beijing, Shanghai, and the "Greater Bay Area" of the Pearl River Delta), examines Xi Jinping's efforts to shift the energies of China's technologists and entrepreneurs away from the consumer internet and toward deep tech, ponders the causes of China's "cultural stunting" and the challenges that China faces, and has not yet overcome, in creating cultural products that the rest of the world wants, and warns of the dangers of focusing only on China's weaknesses and problems and ignoring its prodigious capabilities. Tune in for a fascinating conversation with one of the Sinosphere's more original thinkers.4:15 – Dan appraises Beijing, Shanghai, and the PRD Greater Bay Area20:48 – How to think about the "common prosperity" agenda (a.k.a. the Red New Deal)39:21 – The tradeoff between efficiency and resilience: China as an inefficient but anti-fragile economy45:34 – Should the United States be learning from China? The case for reform of American institutions50:38 – A technocratic resurgence in China? The rise of a "Beihang Clique"58:17 – The causes of "cultural stunting" in ChinaA transcript of this podcast is available on SupChina.com.Recommendations:Dan: Charles Dickens, Bleak House, and Jurgen Osterhammel, Unfabling the East: The Enlightenment's Encounter with AsiaKaiser: Ritchie Robertson, The Enlightenment: The Pursuit of Happiness, 1680 to 1790See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Episode Notes:Today's guest is Chen Long, co-founder and partner of Plenum, a research firm covering Chinese economy and politics. Prior to that, he was a China economist at Gavekal Dragonomics. Chen Long is a Beijinger, and graduated from Peking University. Welcome to the podcast. It's great to have you.2:20 - I think the economy is a little bit like ice and fire, for now. There are certain areas certainly doing pretty poorly. Of course, everyone always talking about the property market, Evergrande, and basically every couple weeks we see a property developer default… 6:00 on the power generation problems - usually December is a peak of Chinese electricity consumption. I'm not sure the current supply of coal is not ... I mean, it's better than a month ago, but they probably have to do a little bit more. So I think it's still too early to say that we have totally overcome the end of the shortage.13:07 on whether this time is different with the real estate market - a year after Beijing and many local governments introduced restrictive policies, finally, we had three months in a row of property sales volume falling by double digits, on a year on year basis. But this is just three months, right? If you look at the previous cycles, especially 2015, 16, we could have the down cycle for 15 months. But this is just three, right? So Beijing has not blinked yet, because it's only three months.16:30 on Evergrande - I think there was a little bit of overreaction, especially when you see headlines linking Evergrande to Lehman Brothers, and this sort of thing. And I have to say that this is at least the third time I hear a Chinese Lehman moment in the last ten years.35:50 on the 6th Plenum and likely historical resolution - The previous ones were all about resolutions on certain questions of the party's history. Right? And this one is not uncertain questions. There is no question. It is resolution on the party's accomplishments over the last 100 years, and the lessons. So I guess it's a big, big summary about what he has done. And, of course, this one I think will cement him as the core, right? And we have to follow whatever he thinks we should do soLinks: The Plenum website. Transcript:Bill:Hi everyone. Today's guest is Chen Long, co-founder and partner of Plenum, a research firm covering Chinese economy and politics. Prior to that, he was a China economist at Gavekal Dragonomics. Chen Long is a Beijinger, and graduated from Peking University. Welcome to the podcast. It's great to have you.Chen:Thank you, Bill. It's my honor to be your third guest.Bill:Oh, well, third time is the charm, I hope. And I hope things are well. And I hope things are well in Beijing. I have to say, I very much miss this time of year in Beijing. There is something really special about autumn in Beijing.Bill:So, to kick off, today, I think we want to talk about the state of economy, and various themes related to that, including common prosperity, and real estate, the sixth plenum that's coming up. But, to start out, could you just give a brief intro about yourself, and more specifically what Plenum does?Bill:Just for listeners, it's a high end research service. The website is at Plenum.ai. And it's really terrific. It's one of my top most favorite research services on China now. They're really sharp on economy and politics.Chen:Yeah. Thank you, Bill. I think, Bill, you have done basically all the marketing I need to do. So we are a pretty young firm. I mean, we were founded two years ago, almost exactly two years ago. And that's when we first started to publish reports. And we write on Chinese economy, policies, politics, geopolitics, other stuff. And we serve institutional clients. Some are financial institutions, some are non-financial corporations.Chen:And I think where we are a little bit different from others, is the team is basically entirely Chinese nationals. But, of course, we'll come from different backgrounds. A lot of people work in the US for many years. And, right now, I'm based in Beijing. Yeah.Bill:And I first came across your work, I think, because you were working with Arthur Kroger, over at Gavekal DragonomicsChen:Yes. I was at Gavekal for almost six years. Yeah.Bill:Right. And I think that's where I first started reading your work. So, anyway, it's great to have you. I've always been a big fan. So-Chen:Yeah. Thank you, Bill.Bill:From a top level, could you just give us your view on what's going on in the economy in China, and where things are?Chen:Yeah. I think the economy is a little bit like ice and fire, for now. There are certain areas certainly doing pretty poorly. Of course, everyone always talking about the property market, Evergrande, and basically every couple weeks we see a property developer default.Chen:But, on the other hand, you also see this energy crunch, which actually was because energy demand was really strong, right? And industrial demand was strong. And then the grid and then the power plants could not meet up with that demand. So you basically have one big sector of economy, and actually several big sectors, apart from the real estate, you have the automobile market actually shrinking this year, general consumption were pretty mediocre, right? Because whenever there's a COVID cluster, you have local governments will restrict travel, or implement some sort of lockdown for two or four weeks. So consumption will be affected.Chen:But, on the other hand, the export is really strong, right? We're probably seeing the best export performance since 2011. That's the best we have in a decade. And there's no sign that this is putting off. A lot of people have said, "No, this is just temporary. Not going to be sustainable." I've been hearing that argument since a year ago. And, right now, it's still really hot. So that's why you have certain sectors ... So that's a little bit special, I think, compared with any time in the last decade. Yeah.Bill:And, certainly, specifically around the energy challenges, you said it was really because demand was so high. How quickly do you think that the ... There have been a whole flurry of measures from the NDRC, and other government bodies, about making sure that the coal supply increases, and cracking down on price speculation.Bill:And, I mean, how quickly do you think that these regulatory actions are going to solve the problem? And, the reforming or the changing in the price mechanism, is that enough to make the power generators actually make money now, so they're more willing to produce energy? Or are we still going to be looking at probably fits and starts over the next few months?Chen:Yeah. I think a lot of the power plants may not be losing money at this point. The government basically did several things at the same time. One, they told all the coal miners just to increase supply as much as you can. And, two, they told the coal miners also to restrict the prices. Basically, they set a cap. And there's a debate on what exactly is the cap, because there are several different versions of the cap.Chen:But whatever version you believe in, there's a cap. And the cap is a lot lower than the market price we had two weeks ago. That's why we had this Zhengzhou thermal coal future price, basically halve in two weeks. And they also allow the power plants to raise the electricity prices by up to 20%, and more if the users are high energy intensity sectors.Chen:So there are flurry of changes happen just over the last months or so. And I think the coal supply has probably improved quite a bit. And we are hearing a lot less stories on companies running ... They face blackouts, or they were just told in very short notice that they have to cut production. We hear a lot less that sort of story. But that still exists, it's just a lot less than a month ago, or at the end of September.Chen:But with this winter heating season coming again, usually December is a peak of Chinese electricity consumption. I'm not sure the current supply of coal is not ... I mean, it's better than a month ago, but they probably have to do a little bit more. So I think it's still too early to say that we have totally overcome the end of the shortage.Bill:Thanks. I mean, it is interesting how it really seemed to have caught a lot of people by surprise. I think both policy makers, but also investors. It's just interesting how that happened, and how so many people seemed to not understand what was going on, including myself.Chen:Yeah. Because, for 20 years maybe, people talk about China has over capacity in IPP, this is actually the power plants. China invested too much in some coal power plants. And I think, at one point, like 2015 or 2016, when over capacity got really serious. And then that was one of the sectors that local and others had to work very hard to cut capacity.Chen:So we never really thought for a second that China would have electricity shortage, because there's always huge supply, maybe oversupply. But I think a lot of things changed since the beginning of the pandemic. The services sector used to be growing a lot faster. But, so far, it's underperforming, while the industrial sector, which were slowing for many years, has suddenly started to outperform.Chen:So, basically, since the second quarter of last year, we have a Chinese economy moving further away from a service driven economy, to a more industrial driven economy. So that's a completely reversal of the trend since 2010, or even 2005.Bill:That's also a reversal of what a lot of economists have recommended China do, right?Chen:Yeah. I mean, people say, "No, yeah, China should become more service driven, and less industrial driven. And also, of course, more consumption driven, less investment driven." But I would say this whole rebalancing theme has somewhat reversed over the last year or so.Chen:And this just, again, has to do with this fire and ice, as I mentioned earlier. So this is just one sector doing really well, it's industrials. And the manufacturing facilities are just all pretty at fully capacity, demand from the rest of the world is really strong. And while the domestic consumption is very mediocre. And service sector, of course, the people just go out a little bit less than they were, in 2019 or earlier.Chen:So basically the economy itself is consuming much more electricity than it used to be, that means two years ago. So, suddenly, we have this issue.Bill:Interesting. And just on that stronger industrial, weaker consumption service sector, is that by design? Is that something that the policy makers want? Or is this just more of an outgrowth of the pandemic changing global dynamics, potentially consumer spending dropping because of concerns about consumer debt, for example? I mean, what's driving that?Chen:I don't think it's intended or planned, or even foreseen by Beijing, by the leadership, I think when China started to get out of the pandemic, in April or May 2020, I mean, there was a real fear, because the rest of the world is experiencing the worst of the pandemic. So the worry, at the time, was China is going to face a demand collapse from the rest of the world. So you got a double whammy economic crisis. So just get out from the domestic demand collapse, you're going to see an external demand collapse.Chen:But somehow that external demand collapse didn't really happen, or just basically happened for one month or so. And turned out to be that the export was really strong. And people in Beijing could hardly believe that. And people say, "Oh, this is just temporary. Because this supply chain was disrupted. But maybe when the things get better next year, the demand will go away. And somebody might has to do with this stimulus checks, given by US government, European governments. Once that effect expires, the demand will go away."Chen:But, so far, it still hasn't gone away. And with Southeast Asia, and Eastern Europe, Latin America, lot of developing manufacture hubs in trouble, China basically became the only manufacture hub that can still maintain enough supplies. So I think that really caught a lot of people, including the Chinese government, by a big surprise.Bill:No, it is. It is really interesting. And so as you talk about the economy, I think you called it fire and ice, I mean, one area that seems a bit icy is real estate. And, obviously, Evergrande's been in the news. But there are plenty of real estate developers that have violated the three red lines, or seem to be in various states of default or near default on some of their debt.Bill:One thing that's been interesting is we've seen real estate stresses that are over the last 15 years or so. Every few years, it seems like there's a cycle, and it's usually policy driven. Because the policy makers want to crack down on real estate speculation and unproductive investment. But then when things start getting bad, and stressed, and companies start having problems, and prices maybe start looking like they're going to drop in some places, the policy makers always blink and pull back, and basically find ways to loosen things up, and let the market return.Bill:It seems like, this time, they've been much more disciplined, I think surprising a lot of people, in terms of being willing to ride out a lot more pain around the real estate sector. Is that a fair assessment? And, if it is, why is that? And if it's not, how do you see what's going on?Chen:Yeah. I tend to believe that this time is not that much different from previous episodes. I mean, I know there's the argument there, saying, "Xi really wants to reduce the share of the real estate in the economy, and wants to curb housing prices." But I don't think this is new. We have this episode, like you just mentioned, multiple times in the last 15 years. Basically every three years, we have a property cycle, from trough to peak to trough. Right? And the Chinese government, in both central and local, that will change policies very, very quickly.Chen:And this time is no different, right? Because you talk about the three red lines, the three red lines really were just introduced a year ago, last August. Right? And, well, the background of that was the PBOC, along with other policy makers, the property market recovered too quickly, and think they're doing too well. And housing prices in cities, especially big cities like Shenzhen or Shanghai, were rising too fast. And that was a little bit unanticipated. So they said, "No, we have to restrict the area, this kind of bull run."Chen:And now a year after Beijing and many local governments introduced restrictive policies, finally, we had three months in a row of property sales volume falling by double digits, on a year on year basis. But this is just three months, right? If you look at the previous cycles, especially 2015, 16, we could have the down cycle for 15 months. But this is just three, right? So Beijing has not blinked yet, because it's only three months. Right?Chen:And we are seeing a little bit some early signs, like PBOC two weeks ago said, "Oh, some banks misunderstood our intention, when we told them to restrict the lending. And some of the normal projects would not be restricted," blah, blah, blah. And then I think today, or yesterday, one of the state-owned media, Economic Daily again published article about these housing regulations. So I think we're seeing some signs that those things are easing a little bit. So it's not like they are just letting the market die.Bill:Right. Well, and I mean, there are real risks. I mean, there are real risks around ... I mean, I owned property in China for a while, and certainly had lots of friends, including some real estate developers, and people with lots of ... I mean, there was just this sense that, in these previous cycles, they would go until prices started dropping, and there was a risk of people getting really pissed off because they were losing money again.Bill:And so is that one of the things ... I mean, again, it doesn't seem like the prices have dropped that much yet in most places. Is that one of the things to look for, where if we start seeing housing prices actually go negative, is that one of the triggers that makes the government maybe start loosening faster, just because they're worried about how ... I mean, they have their constituency, and people who own property. They do care what they think, right?Chen:Yeah. That's certainly one thing they care about. And I think another thing they care about is the impact on economy, like the GDP, right? The housing and the real sector as a whole, if you found all the upstream industries all together, it'd account for probably one third of Chinese economy. Right? So if you kill the real estate sector, basically you kill the economy. And they can't do that. That's suicide.Bill:No. It's still a quarter of the economy. Right? So somewhere around there, if you add up all the various-Chen:Yeah. Depending on how you estimate, anywhere between 20% to a third, that's kind of the estimation. Yeah.Bill:So, Evergrande, there was a massive freak out over Evergrande. And I think it's maybe even a month ago, or a little longer. Did people overreact to what's going on at Evergrande. And what is going on there? And how do you think it gets resolved?Chen:Yeah. I think it has a little bit of sense that people were a little bit overreacting. I got called by Al Jazeera twice in two days, saying, "We need you to comment on Evergrande." I was like, "Come on, guys. You guys, yeah, are very respectful media TV, but you don't need to tell your audience in Qatar what's going on in Evergrande, in two days in a row. And one of that is a Sunday."Chen:So I was like, "Oh, this is really everywhere. Right? It's not just Bloomberg or Wall Street Journal. This has gone to non-financial media as well." And that was basically the main theme in the last week, or last two weeks of September. Right? So I think there was a little bit of overreaction, especially when you see headlines linking Evergrande to Lehman Brothers, and this sort of thing. And I have to say that this is at least the third time I hear a Chinese Lehman moment in the last ten years.Bill:I was just going to say, is the default analogy when ... Oh my God, China's Lehman moment. And we saw it. I remember it was, I think, 2013, when the interbank market basically went crazy, the end of Q2, early Q3. And I forget the other one. But, no, every time I see someone say, "China's Lehman market," basically, just to be honest, I just tune it out. Because it doesn't fit. And it never has. And if China has a big problem like Lehman Brothers, it won't be like Lehman brothers. It'll be something else, is my view.Chen:Yes, totally. And I don't know that even if Lehman Brothers exist today. I mean, if the same thing happens today, with the current federal reserve, with the current Fed chairman, that this will not have happened. Because they would just do QE.Bill:So what does happen with Evergrande? I mean, how does this thing get resolved?Chen:Evergrande, on the surface, just a very large company, over leveraged, and had a liquidity problem, maybe has solvency problem. We don't really know how much of its assets is real, or how much liability is real. Maybe its liability is a lot more than is stated. It says it has 2 trillion RMB liability, but if it has 2.5 trillion, then the company is insolvent, right? So we don't really know.Chen:And the thing is, we just start to see that this company started to have funding problem, since PBOC introduced the three red lines, because it failed in all the three. Banks were afraid of giving it money, and couldn't refinance in the bank market either. And the trust company, and the trust world that everyone saw, started to have problems. So, basically, with leverage at that size, you have to keep borrowing. To Evergrande, they're reducing the debt. And once that snowball stops moving, then basically you collapse, right? So I guess that's basically what it faced.Chen:And how we're going to resolve it, I think, in the best case scenario, that a lot of the estate projects will just ... First, they have to get it finished. And some of the land, or some other projects be sold to other developers. And Evergrande will downsize to a much smaller developer, and then will start to exist.Chen:And that's quite similar to what Wanda did. Wanda was a much bigger property developer five years ago. But then since has sold a lot of the projects, both in China and overseas. And, basically, right now, it's like a property management company, and doesn't have a lot of power assets. So that's what Wang Jianlin did to save himself, basically, and his company.Chen:So maybe, on Evergrande, if you're rational, you think that's a good scenario. But I think Hui Ka Yan doesn't want to give up. I think that he is betting on another big easing from Beijing. Right? Because he has been in this, I would say, in the live or die moment, at least twice in the last 15 years. Right? The first time I heard about Evergrande was 2007, right? I saw news that Hui Ka Yen was having drinks with the Hong Kong tycoons, and playing mahjong together. And, finally, he received a lot of money from the Hong Kong tycoons. And then that saved him in 2008, when the company was on the edge of collapse.Chen:And the second time was 2015. The company was again on the edge of collapse. And then it bet on a big easing from Beijing, and then property market turned around. It became much bigger. And I think, this time, Hui Ka Yen doesn't want give up. But he did say two weeks ago that he wants to move further from property developing, wants to become electricity car company. God knows whether he can succeed or not, but he's not going to just give up.Bill:Right. Right. No, he's the kind of ... I mean, that's why he's been so successful, and why he's been able to pull this off, right? I mean, he's just going to go until he can't go anymore. And it will be-Chen:Yeah, yeah. I think that the government ... Yeah. Sorry.Bill:No, go ahead. Go ahead, please.Chen:Yeah. I think from the government's perspective, the government would just want Evergrande to downsize, finish the existing projects, pay off your debt. It becomes a smaller company. And then your risk also is a lot smaller. But I'm not sure that's something that Hui Ka Yen has decided to do. Because then he will become a much less relevant person. Right?Bill:Right. And the government does also seem concerned now about the risks of defaults in the overseas debt markets. Right? I mean, it seems like this is the constant tension, right? They want introduce some discipline, and they want to avoid moral hazard, but they can't have a bunch of offshore bonds default in a short period of time. Right? Because then that potentially really screws up the market for them for a while, doesn't it?Chen:Yeah. That's actually an interesting point. Because when people ask me about Evergrande like a month and a half ago, and I was basically saying, "I think the dollar bond market matters the least for Beijing." Right? Because you have a different kind of creditors of Evergrande, right? You have the home buyers, who've paid, but they haven't received the houses. And then you have the construction firms and their workers. And you have the domestic banks, the domestic WMP holders, domestic trust companies. And they all matter a great deal for the Chinese financial system. And the last one is a hedge fund or someone who bought a bond in Hong Kong. But all of a sudden, they had a meeting a week ago, saying, "Hey, guys, we have to have a little bit discipline. Don't just run away. And you have to also take care of your offshore debt." I still haven't figured out why, what changed in their thinking. Maybe this is just a way to calm down the Wall Street. But why did they suddenly feel they have to calm down the Wall Street, six weeks after the crisis happened? I haven't figured out.Chen:My hypothesis is maybe some Wall Street bosses put some pressure on Chinese leadership. I did notice that a lot of the big bankers, and the big American company, and the senior executives had a video conference with Wang Qishan two or three weeks ago, in the name of the Xinhua advisory board.Bill:Right. Right, right, right. That's interesting. And I have to say, I find it very, very strange that the US Secretary of State, Blinken, brought up Evergrande a couple weeks ago, which he made some comment about hoping the Chinese manage ... I forget exactly, but it just-Chen:Well, he was asked by CNN, or someone. Yeah, he was asked.Bill:Oh, was it a response? He was asked? Okay. It just seemed like it was very out of his lane, in terms of what the Secretary of State would talk about. So-Chen:Yeah. He basically said, "People have to act responsibly."Bill:Interesting. I mean, I think it is interesting though. It definitely does seem to be a shift. So, speaking of shifts, I know we only have a few more minutes, but I'd love to get your thoughts on ... Again, this is something lots of people ... Outside of China, I know we're scratching their heads, but certainly folks I've talked to inside China too, are trying to really get their hands around, what does common prosperity mean? And, really, what changes, what policy direction are we really going to see around common prosperity? And there was that strange WeChat post that was from a very sort of Neo-Maoist-Chen:Li GuangmanBill:Yeah, yeah, the very Neo-Maoist blogger, that was picked up over the weekend by the online properties of Xinhua big state media properties, which caused a lot of consternation outside China, but I think inside China as well. And so it seems like the messaging is a little bit mixed, and there's obviously a lot of politics involved. But what do you see, or what's your guys' view, the point of view on what common prosperity means going forward?Chen:Well, we tend to think that common prosperity is next step after President Xi completed the poverty alleviation campaign, right? So after poverty alleviation, in theory, China should have no absolutely poorer people, right? Nobody's living in poverty anymore. And then what's the next step, right? That's not the end. Right? You get out of poverty, but you should get richer, and you have a better life.Chen:So I think that's something that he came up with after that, that we want everyone to have a more decent lifestyle. And, of course, he chose Zhejiang province, a province he spent five years as party secretary to be this pilot program, or pilot area for common prosperity. And the thing about Zhejiang was ... The thing Zhejiang published was rather, I would say, a standard, right? It basically said, "No, we want to increase the household time by one percentage point, or increase the GDP by certain percentage point. And then the equality among different cities should be restricted within a ratio, and people should be able to find the jobs very easily," blah, blah. So a lot like that.Chen:So it's still very pro growth, the Zhejiang plan. But we all know the common prosperity is not only about growth, it's also about redistribution, which is something Zhejiang did not mention very much in his own report, which is understandable. Because that requires tax policy changes that Zhejiang has no say. So Beijing has to decide what kind of tax, what you have to introduce, right? People talk about this property tax, and more pilot programs for property taxes. And then we talk about the consumption taxes. So this kind of stuff, Zhejiang has no say, right? So Beijing has to decide what exactly they're going to do with all these taxes.Chen:So there's certainly an element also about redistribution, restricting certain super rich, and especially those who got rich without behaving, how to say, legally, or you operate in gray area. For many years, there was no law or no regulation. You got rich, but maybe you broke the law. Right? So if you got rich through that channel, then maybe you have to rethink a little bit. Yeah. Or at least you have to change your model completely, because that's no longer tolerated. Right? Because the President did say, "We encourage everyone to work very hard to get rich. And that's great. But we also want to restrict people from getting rich using dodgy channels."Bill:Right. And I think that's what has certainly freaked out a fair number of people. Right? Because it's always unclear what the definition of dodgy or not legal actually is, and how far back they might go. And, that, I think also ties a bit into ... I know you guys have written a fair amount about all these various regulatory actions, and specifically around anti-monopoly policies and regulatory decisions, and also the changing approach to internet platform regulation.Bill:Are we in a new normal, when it comes to regulation? I talk to some people who think this is all passed, and it's going to get better again. But, to my perspective, it really feels like we're in a new era of this kind of stuff. And so, the big internet companies, their businesses are still good, but they're never going to be the same. And it feels like, their costs, they're going to have a lot higher cost base, because they're not going to be able to exploit workers and customers, like the way they used to be able to.Chen:Yeah. I think the compliance cost will certainly be a lot higher than before. And these regulations have passed. And they will stay here. They'll not go away. They'll not be rolled back. So I don't think there's anything like the end of the regulation, or the end of the regulatory competitor. There will be no end.Chen:But I do think maybe the peak is behind us. Think about the largest internet companies in China, Alibaba and Meituan were already punished for antitrust. And the Tencent was not directly affected by the trust, but the gaming thing was also mentioned, and a lot of other guys also name checked, like ByteDance, or Pinduoduo, they were also a little bit worried. So it is hard to say who will be bigger than Alibaba, who will be a bigger victim than Alibaba, it's very hard to ... Unless Tencent suddenly runs into a big trouble. But nobody else is bigger than Alibaba in the Chinese internet domain.Chen:So I guess, after these campaigns, maybe since we settled down a little bit, it will not be over, but we're likely to suddenly see another company find 18 billion RB immediately, or another large fintech company saying, "You have to dissolve, or you have to be separated into different arms." Nobody else is really as big as Ant Right? So I guess maybe we have passed a peak.Chen:And especially, this year, again, I think there's something different about this year, is since the very beginning, Xi made it very clear that this is a year that we don't have to worry very much about economic growth, because it's very easy. Right? They said the growth is targeted at 6% intentionally, which is a target they're going to reach anyway. Right? So, basically, they can do a lot of other things, like structural reforms, and some things they wanted to do in the past, but didn't have the time or the capacity. But, finally, this year, you can spend all your efforts in these things.Chen:But next year will be different again. But next year, actually, we'll go back to the normal China, that you have to be worried about growth target, right? Where is Beijing going to set the growth target? People are debating. I think it's still being something like five and a half percent. And I definitely don't think it'll be lower than 5%. And given the current trajectory, they have to change policy quite a bit to reach either target, especially…Bill:So you're saying, if they decide the target for next year is 5%, they'd have to ease up on some things for next year?Chen:Yeah. I think, five, there is a little bit. And if five and a half, they have to ease quite a lot. And that means you have to be a little bit nicer to companies in general. Right? So, last year in 2020, Xi had several symposiums with various people, and at least two with large companies, right? One, there was a foreign company, the other was all Chinese private firms.Chen:But, this year, at least on the record, I haven't seen any of these kind of symposiums with companies. Right? So he only does that when he's worried about the corporate sector. And, this year, he's not worried, apparently. But, next year, if he's worried again, he could come up, and then they'll have a conversation with these guys in person. And if he does that, then the crackdowns will be a lot softer, at least. Right?Bill:Interesting. So last question, I know you got to go, is what do you think we're going to see out of the sixth plenum, that investors and others should really be paying attention to, that starts ... I guess it starts on Monday and runs through, I think, Thursday next week, right?Chen:Yeah. Yeah. Well, the sixth plenum is all about one thing, right? It's this resolution about the accomplishments of the party in the last one, two years. Right? And I think the previous two resolutions, we had one in 1945, another in 1981, right? Maybe the 1981 one is more relevant, because of course that's more recent, and that was done by Deng Xiaoping. And, without the second, we wouldn't have known there would be another resolution. Right?Chen:But I think this time it's quite different. Because both in the first resolution, basically written by and approved by Chairman Mao, and the second one basically drafted and finally approved by Deng and Chen Yun and other old comrades. But they had to fight with a different ideology. Right?Chen:So in the first resolution, Chairman Mao was basically saying that the party made a lot of mistakes in the 1930s. Right? And ended up then with the Long March. And then we had the Zunyi conference. And then I had to be this poor core. And then the party was saved. Right? So there was a real fight between Mao and a lot of other guys, from Wang Ming and others. So he used that resolution to cement what happened in the party over the past 20 years or so, which was right and which was wrong. So that was basically that resolution was all about.Chen:And the 1981 resolution was similar. Right? So this old comrades had to ... They felt they had to come with something to summarize what happened since 1949, what was right, what was wrong? Where did chairman Mao did right? And where did he did wrong? And what we should do next? Right? So there was a lot of that. And also of course Hua Guofeng at the time was still relevant. Right? So he had to make sure that this 两个凡是, that whatever Mao said, we had to follow. Right? This is...Bill:Yeah, the two whateversChen:Yes. Yeah. So he had to crack that. So, in both occasions, there were clear things they had to correct. But, this time, I really don't think there's a clear thing that President Xi has to correct. Because no one is really arguing something else. And I think they usually talk about their mistakes, or some problems the party had since 1981. Maybe the biggest thing was what happened in the late '80s. Right?Chen:But since 1992, when Deng did this sudden speech, and everything was basically all about the reform, and open up, blah, blah. Of course, we had a little bit of chaos during the 18th party Congress, Bo Xilai and all these guys. But that, I think, was so minor, if you compare all the other accidents the party had over the last 100 years, right? Maybe it's only relevant in the last 40 years. So I think this all ...Chen:And also the name was a little bit different, right? The previous ones were all about resolutions on certain questions of the party's history. Right? And this one is not uncertain questions. There is no question. It is resolution on the party's accomplishments over the last 100 years, and the lessons. So I guess it's a big, big summary about what he has done. And, of course, this one I think will cement him as the core, right? And we have to follow whatever he thinks we should do so, and that's something definitely right.Bill:That's an interesting point, about if it's not actually about certain questions. And probably, certainly, if people want to ahead of this, I think reading that document ... I think it came out in August. It was basically a long piece about the party's accomplishments. I'm guessing that there'll be a lot in this resolution that is very similar to that language.Chen:Yeah, yeah.Bill:Right? I mean, it seems like it's a draft almost. And, really, like you said, it's not about settling a fight that's been going on, so much as more forward working. But so what does that mean? I mean, I assume this will tie into common prosperity. And I guess, this plenum, it really is going to be about this. There's probably nothing from a policy perspective that's going to affect the economy, or how investors should look at China in the near term, right?Chen:Yeah. I guess not that much in the near term. Well, of course, this one will set a stage for next year, where the big thing will happen. So the 20th party Congress, will get them to say, "No, we're going to follow this revolution, and then do whatever we should do in the next few years." Right.Bill:Great. Well, hey, I really appreciate your time. I think really want to thank you for being one of the first guest of Cynicism. And I will put a link to the Plenum website in the show notes. And I highly recommend anyone who is a financial market professional in China, you should go sign up for trial. Like I said, these guys, Chen Long and his team, and the Plenum research product is really quite terrific. So thanks again for your time. And I hope everything stays safe in Beijing. We see lots of headlines about COVID in Beijing right now. But I-Chen:Yeah, it is absolutely safe. If I go out, I may not be able to come back. So it's absolutely safe to stay here.Bill:Right. So you're probably not leaving Beijing until February, right? I mean, is it possible that you really can't leave before the Olympics?Chen:I think I can. I think, after next week, things may be a little bit relaxed. I think it's just partly because of next week, the sixth plenum.Bill:The plenum.Chen:And partly because the COVID clusters are still on the rise. But I think after next week, I might be able to travel a little bit.Bill:Great. Well, anyway, thanks again for your time. And I hope to talk to you soon.Chen:Yeah. Thank you, Bill. Yep. Get full access to Sinocism at sinocism.com/subscribe

Over the last several months, Chinese authorities have undertaken a sweeping campaign of change. We've seen crackdowns on big tech and fintech companies (like Ant Financial and Didi), online education companies, and now even the playing of video games. Investors in key sectors have gotten clobbered by the new rules. So what is the goal and what is the endgame here? On this episode, we speak to Dan Wang, a China tech analyst at Gavekal Dragonomics, who breaks it all down. See omnystudio.com/listener for privacy information.

BEIJING -- In Episode #10 (Segment 1 of 2) of his podcast, Thomas Fraser talks with Arthur Kroeber, Founding Partner and Head of Research at Gavekal Dragonomics, about China's economy and opportunities China's transition to a more service-orientated economy will create.  Kroeber is the author of the excellent book "China's Economy: What Everyone Needs to Know."Kroeber's book provides an excellent overview of China's economy for business leaders, policymakers and others wanting to understand where China's economy is today and how China's growth model is changing.To learn more about the Tom Fraser Podcast and to listen to additional episodes, please go to www.tlfraser.com/podcasts.This podcast was originally published at www.tlfraser.com on August 25, 2016.The information provided in this podcast does not constitute the provision of legal, tax or investment advice.  This information is provided for general informational purposes only.Copyright 2015-2021 Thomas L. Fraser.  All Rights Reserved.   

BEIJING -- In Episode #10 (Segment 2 of 2) of his podcast, Thomas Fraser talks with Arthur Kroeber, Founding Partner and Head of Research at Gavekal Dragonomics, about China's economy and opportunities China's transition to a more service-orientated economy will create.  Kroeber is the author of the excellent book "China's Economy: What Everyone Needs to Know."Kroeber's book provides an excellent overview of China's economy for business leaders, policymakers and others wanting to understand where China's economy is today and how China's growth model is changing.To learn more about the Tom Fraser Podcast and to listen to additional episodes, please go to www.tlfraser.com/podcasts.This podcast was originally published at www.tlfraser.com on August 25, 2016.The information provided in this podcast does not constitute the provision of legal, tax or investment advice.  This information is provided for general informational purposes only.Copyright 2015-2021 Thomas L. Fraser.  All Rights Reserved.

Cutting-edge semiconductors are the most complex objects that humans make. Host Hal Hodson and Tim Cross, The Economist’s technology editor, delve into the secretive science that powers a growing portion of economic activity and the world-leading yet precarious work of TSMC—the company that dominates chipmaking. The pandemic has exposed vulnerabilities in this system, but the race to dominate the world of chips is just beginning.With Dipti Vachani, vice president of automotive and IoT at Arm, Dick Thurston, former chief counsel to TSMC, and Dan Wang of Gavekal Dragonomics.For full access to The Economist’s print, digital and audio editions subscribe at economist.com/podcastoffer and sign up for our new weekly science newsletter at economist.com/simplyscience. See acast.com/privacy for privacy and opt-out information.

Cutting-edge semiconductors are the most complex objects that humans make. Host Hal Hodson and Tim Cross, The Economist’s technology editor, delve into the secretive science that powers a growing portion of economic activity and the world-leading yet precarious work of TSMC—the company that dominates chipmaking. The pandemic has exposed vulnerabilities in this system, but the race to dominate the world of chips is just beginning.With Dipti Vachani, vice president of automotive and IoT at Arm, Dick Thurston, former chief counsel to TSMC, and Dan Wang of Gavekal Dragonomics.For full access to The Economist’s print, digital and audio editions subscribe at economist.com/podcastoffer and sign up for our new weekly science newsletter at economist.com/simplyscience. See acast.com/privacy for privacy and opt-out information.

This week on Sinica, Kaiser talks with Dan Wang, a Shanghai-based analyst at research firm Gavekal Dragonomics, who also contributes a regular opinion column to Bloomberg. Combining firsthand knowledge of China’s tech sector with broad erudition and a humanist’s perspective, Dan offers a unique take on China’s innovation ecosystem, the country’s efforts to achieve self-sufficiency in technology, and the role of economic growth, fundamental optimism, and inspiration in China’s rise as a tech power.13:53: The outsize importance of economic growth25:02: An overemphasis on digital technology33:55: Reciprocity and technological codependence 49:12: Technology is more than just tools and patentsRecommendations:Dan: The works of Marcel Proust, and the ham and mushrooms of Yunnan Province. Kaiser: The Netflix series Flavorful Origins and Great State: China and the World, by Timothy Brook.

We've been talking a lot on the podcast about semiconductors. The stumble of Intel. The general troubles with US manufacturing, and, of course, the rise of TSMC. But, for a long time, the Chinese government has endeavored to build a successful homegrown and world-leading chip industry. On this episode, we speak with Dan Wang, a tech analyst at Gavekal Dragonomics. He discusses the state of the domestic industry, as well as broader lessons on Chinese tech and business after a year of extraordinary disruption.

Apple's recent revenue warning reminded the world of how exposed the company is to China, and in particular its factories. As the coronavirus continues to shutter huge swaths of the Chinese economy, this is a potential risk for numerous companies beyond just Apple. On this week's Odd Lots podcast, we speak with Dan Wang, a China tech industry analyst at Gavekal Dragonomics about how this, along with pressure on Huawei, are putting extraordinary pressure on the Chinese supply chain.

Earlier this month, President Trump escalated the trade tensions against China by limiting exports of U.S. technology to Huawei. But what is Huawei, and why is this such a big deal? On this week's episode, we speak to Dan Wang, a technology analyst at Gavekal Dragonomics, about the importance of Huawei to the Chinese tech industry, the specifics of what Trump just did, and the far-reaching fallout that we could see from this new phase of the trade war.

Anatole Kaletsky is co-chairman and chief economist of Gavekal Dragonomics, a Hong Kong-based investment research and asset management firm serving 900 global financial institutions. He is also a prominent economic commentator, director of JP Morgan Emerging Markets Investment Trust and a board member of the Open Society Foundations and of the Institute for New Economic Thinking. Before co-founding Gavekal in 2002, Kaletsky worked for 25 years as a journalist for the Economist, Financial Times, London Times, Reuters and the New York Times, winning numerous awards including European Journalist of the Year (1998), Newspaper Commentator of the Year (1996) and Specialist Writer of the Year (1981 and 1992). He now writes monthly columns for newspapers around the world in the Project Syndicate network and for Prospect Magazine in Britain. His book Capitalism 4.0, about the post-crisis transformation of the global economy, was nominated for the 2011 Samuel Johnson Prize. Kaletsky was educated at Cambridge, where he received a First Class Honours degree in Mathematics, and at Harvard, where he was a Kennedy Scholar, and received a MA in Economics. He is an honorary Doctor of Science from the University of Buckingham. Recorded at The Tabernacle in London in May 2018. 5x15 brings together five outstanding individuals to tell of their lives, passions and inspirations. There are only two rules - no scripts and only 15 minutes each. Learn more about 5x15 events: http://5x15stories.com Twitter: http://www.twitter.com/5x15stories Facebook: https://www.facebook.com/5x15stories Instagram: https://www.instagram.com/5x15stories

The recent trade tensions between the Trump administration and China has shone a light on the country's ambitions to become a technology powerhouse, as one of the complaints is that China unfairly extracts intellectual property from multinationals entering that market. But what, specifically, is China's long-term plan? On this week's Odd Lots podcast, we speak to Dan Wang, a technology analyst at Gavekal Dragonomics about the the Made In China 2025 initiative, which seeks to turn the country into a tech leader (in areas like semiconductors, medical equipment, clean energy, and wide-body aircraft) by the year 2025. Dan explains how the program works, where it's succeeding, where it's struggling, and what the ramifications are for the rest of the world. 

The US and North Korea have been flexing their military muscles in recent weeks, testing and deploying new missiles. President Trump has said North Korea is "a big big problem" that he will deal with "strongly". This week he took the extraordinary step of briefing the entire US Senate on American options to deal with the North's nuclear programme, as American troops conducted live-fire exercises near the North Korean border. Senators said the briefing was "sobering". Here, David Aaronovich gets his own briefing, from one of America's top former diplomats in the region and from experts in Beijing and Seoul.CONTRIBUTORS:Daniel Russel: President Obama's Assistant Secretary of State for East Asian and Pacific Affairs, now Diplomat-in-Residence at the Asia Society Policy InstituteYanmei Xie: Chinese foreign policy analyst, formerly with the International Crisis Group, now with Gavekal Dragonomics.Jenny Lee: Opened the first western news bureau in North Korea, now with the Wilson Centre in SeoulProducer: Neal Razzell Research: Sarah Shebbeare

Join Dr. Carlos as he discusses China's economy with Arthur Kroeber. China's Economy: What Everyone Needs to Know® is a concise introduction to the most astonishing economic growth story of the last three decades. In the 1980s China was an impoverished backwater, struggling to escape the political turmoil and economic mismanagement of the Mao era. Today it is the world's second biggest economy, the largest manufacturing and trading nation, the consumer of half the world's steel and coal, the biggest source of international tourists, and one of the most influential investors in developing countries from southeast Asia to Africa to Latin America.China's growth has lifted 700 million people out of poverty. It has also created a monumental environmental mess, with smog-blanketed cities and carbon emissions that are a leading cause of climate change. Multinational companies make billions of dollars in profits in China each year, but traders around the world shudder at every gyration of the country's unruly stock markets. Most surprising of all, its capitalist economy is governed by an authoritarian Communist Party that shows no sign of loosening its grip.How did China grow so fast for so long? Can it keep growing and still solve its problems of environmental damage, fast-rising debt and rampant corruption? How long can its vibrant economy co-exist with the repressive one-party state? What do China's changes mean for the rest of the world? China's Economy: What Everyone Needs to Know® answers these questions in straightforward language that you don't need to be an economist to understand, but with a wealth of detail drawn from academic research, interviews with dozens of company executives and policy makers, and a quarter-century of personal experience. Whether you're doing business in China, negotiating with its government officials, or a student trying to navigate the complexities of this fascinating and diverse country, this is the one book that will tell you everything you need to know about how China works, where it came from and where it's going.About the AuthorArthur R. Kroeber is founding partner of Gavekal Dragonomics, a China-focused economic research consultancy he established in Beijing in 2002 after 15 years as a freelance financial journalist in Asia, and editor of its flagship publication China Economic Quarterly. He is also head of research at the firm's parent company Gavekal, where he advises financial, corporate and government clients on economic and political developments in China. Kroeber is a senior non-resident fellow of the Brookings-Tsinghua Center for Public Policy, adjunct professor at Columbia University's School of International and Public Affairs, and a member of the National Committee on US-China relations. He lives in Beijing and New York.

In this episode of Sinica, we present an in-depth interview with Arthur Kroeber, the founding partner and head of research for Gavekal Dragonomics, an independent global economic research firm, and the editor-in-chief of its journal, China Economic Quarterly.  Arthur's new book, China’s Economy: What Everyone Needs to Know, superbly explores China's astonishing expansion during the "reform and opening up" period and the challenges the country now faces as growth slows. He provides a clear-eyed take on a huge range of subjects, from the internationalization of the renminbi to local debt to the way China's state-owned enterprises function (or don't). The book is a refreshing antidote to much of the commentary in the media, where "The Conventional Wisdom" we discuss in the podcast consists of doomsayers predicting China's imminent collapse and Pollyannas who see the country as an unstoppable economic juggernaut. We love feedback: Please write to sinica@supchina.com. Recommendations: Jeremy: The Silk Road: A Very Short Introduction by James A. Millward Arthur: The Ibis Trilogy by Amitav Ghosh Kaiser: Soulstealers: The Chinese Sorcery Scare of 1768 by Philip A. Kuhn — Kaiser and Jeremy

On August 24, 2015, global financial markets plunged following China’s “Black Monday,” the largest sell-off in the history of the Shanghai Stock Exchange. Following a burst in the stock market bubble in June 2015, trillions of dollars were erased from the stock index throughout the summer, with the largest day of losses hitting on Black Monday. The sheer scale of the stock market crash, accompanied by weak manufacturing data and an unexpected devaluation of China’s currency exacerbated long held concerns by some economists that China’s economic development was unstable. In his new book, China’s Economy: What Everyone Needs to Know, Arthur Kroeberargues that many of these fears are exaggerated. To understand the context of the current economic situation, Dr. Kroeber describes how the Chinese economy has evolved since 1979 and the initial reforms of the Deng Xiaoping era. The Communist Party of China has effectively managed the transformation of the economy. The Chinese leadership was able to learn from the examples of other East Asian “development states.” While there are considerable similarities, Dr. Kroeber notes that there are also profound differences between China’s development model and those of Japan and South Korea; the similarities and the differences have a profound impact on the prospects for China’s economy. As Western economies continue to struggle to rebound from the global financial crisis of 2008, worldwide economic progress has been dependent on China’s unprecedented economic successes. Some analysts fear that systemic flaws in China’s economy will undermine China’s economic potential. Join us as Arthur R. Kroeber discusses the Chinese economy as it moves in a consumer-driven direction amid demographic and environmental challenges, with the National Committee on May 18, in New York City. Arthur R. Kroeber is head of research at Gavekal, a financial-services firm based in Hong Kong, founder of the China-focused Gavekal Dragonomics research service, and editor of China Economic Quarterly. He divides his time between Beijing and New York. Before founding Dragonomics in 2002, he spent fifteen years as a financial and economic journalist in China and South Asia. The National Committee on U.S.-China Relations is the leading nonprofit nonpartisan organization that encourages understanding of China and the United States among citizens of both countries.  

(Bloomberg) -- Taking Stock with Kathleen Hays and Pimm Fox. GUEST: Arthur Kroeber, Founding Partner of Gavekal Dragonomics, a China-focused economic research consultancy in Beijing, and a fellow of the Brookings-Tsinghua Center for Public Policy, on his new book, "China's Economy: What Everyone Needs To Know."