From an economic perspective, no country better represents the Olympic motto—“faster, higher, stronger”—than China. During the last 30 years of opening to the outside world and economic liberalization, China has grown to be the world’s third-largest trading nation and fourth-largest economy. More important, the increase in economic freedom has widened the range of personal choices and given millions of people the opportunity to leave the state sector and “jump into the sea of private enterprise.”
Posted August 11, 2008

Rumor has it that hot money is betting on a sharp appreciation of the renminbi. China’s official reserve assets seem to accumulate at ever increasing rates, and recent increases are not accounted for by the trade surplus and net foreign direct investment. It appears there’s money coming in, but why would speculators be betting on a big-time revaluation? It doesn’t fit with macroeconomic fundamentals.
Posted July 30, 2008

Winning in China’s crowded retail landscape begins by knowing how to match business models to new markets. Sounds easy? Yet only one in three multinational retailers gets it right.
Posted July 18, 2008

In the summer of 2008, the global economy faces unprecedented challenges. Torn between the threat of asset deflation in America and rampant commodity price inflation in emerging markets, something will have to give. A global slowdown seems inevitable. For forward looking investors, the really interesting question is now which country and which market is likely to emerge as the winner once the downturn-dust settles. In my view, Japan is poised to be next star performer. Yes, that’s right, watch out for Japan to emerge as a great winner once the next global up-cycle starts.
Posted July 15, 2008

As G-8 leaders gather in Japan this week, one of the main points of discussion will be the extraordinary rise in the international prices of agricultural commodities. The rise in commodity prices has mirrored food price hikes throughout the developing world, including in China and India. Increased prices are impacting the lives of millions of poor, contributing to overall inflationary pressures and risking political unrest.
Posted July 7, 2008

The process of creative destruction, Joseph Schumpeter wrote, is “the essential fact about capitalism.” The old is destroyed by the new and improved. But it is an essential fact that the Chinese leadership is unwilling to accept. Beijing's response to rising energy prices—the most pressing economic issue of our time—suggests that it has no intention of changing course anytime soon.
Posted June 30, 2008

So they finally did it. On May 4 the finance ministers of 13 East Asian countries agreed on the sidelines of the annual meeting of the Asian Development Bank in Madrid to set up a pool of foreign-exchange reserves. The member countries of the Association of Southeast Asian Nations together with China, Japan and South Korea decided that at least $80 billion of the region’s foreign reserves are to be funneled into a regional fund to protect regional currencies against speculative attacks and provide countries in crisis with liquidity. Of the funds, 20% are to be provided by the 10 Asean members and the remaining 80% by the “Plus Three” countries (China, Japan and Korea).
Posted June 18, 2008

While China hoped that the Beijing Olympics would focus world attention on the country’s stunning accomplishments, 2008 has been a difficult year. The local Chinese stock markets suffered a decline of almost 50% from their levels in late 2007. Then came the protests in Tibet and the horrific tragedy of the Sichuan earthquake. But I believe the lasting legacy of the Sichuan quake will be a tectonic shift towards a freer China, an enhanced image of the Chinese government, and a renewed commitment to encourage rapid growth in the poorer central and western regions of the country.
Posted June 10, 2008