Greetings from Hong Kong, right in the heart of Asia, where I have now relocated from London permanently as an international and independent China specialist. The shipment of my household effects has arrived and I can now enjoy better days without living out of a suitcase.
Before the silly season starts, may I first wish you a delightful and rewarding summer.
If you fancy some entertaining reading while seeping a cool drink by the pool, you may enjoy a sketch on ‘Shanghai Expo 2010 – Impressions of the Future and the Past’ at
http://www.andrewleunginternationalconsultants.com/chinawatch/ This was based on my short detour to the Shanghai Expo before settling back in Hong Kong.
On the global front, the G20 Summit in Toronto on 26-27 June lost no time in coming to grips with national budget deficits, which the West has vowed to halve by 2013 with massive belt-tightening all around. This is happening while EU economies are still struggling to contain the Greek crisis with a European Financial Stabilization Fund, comprising €500 billion from the member states and €250 billion from the IMF. The fear, of course, is the possible transmigration into a full-blown Sovereign Debt Crisis across Europe and elsewhere. You may wish to re-visit the March 2010 Cover Story ‘Sovereign Debt Crisis: Ripple Effect on the Global Economy’ in the Chartered Financial Analyst at http://www.andrewleunginternationalconsultants.com/files/chartered-financial-analyst-cover-story---sovereign-debt-crisis-1.pdf
Meanwhile, a shadow is casting over the future of the Euro, whose deficiencies have recently been highlighted by George Soros at http://www.georgesoros.com/interviews-speeches/entry/george_soros_speech_at_humboldt_university/
The fortune is not vastly better on the other side of the Pond, as US employment figures are lower than expected while the Black Swan of Deepwater Horizon is adding to the anxiety. Whether the Keynesian recipe in The Return of Depression Economics (Paul Krugman, Penguin Books, 2008) will work better in these uncertain times is debatable. Meanwhile, there is no stopping the greenback printing press. In any case, having got his fingers’ burnt by excessive credit leveraged out of a dream of ever-rising home values, the US consumer is now starting to spend less and save more, regardless of credit availability. A post-bubble leveraging of the US consumer has just begun, according to Stephen Roach (The Next Asia, John Wiley & Sons, 2009, pp. 385-6). As US private consumption is six times that of both China and India combined, a sustained weakening of US consumption is likely to depress the demand side of the global economy in the coming years.
The only glimpse of hope, so it seems, is with the surging Emerging Markets, especially China. The increased flexibility for the RMB, the Chinese yuan, together with the green light given by China Securities Regulatory Commission for the Agricultural Bank of China’s proposed IPO, slated to be the world’s largest, have set the stage for a more buoyant mood. Though China’s Purchasing Managers’ Index has recently slipped to 52.1 from 53.9 in June, the launch of the Economic Cooperation Framework Agreement with Taiwan avoided any undue pessimism. The Agreement will also be beneficial to the Region as a China-centric supply chain hub.
What is more, the recent spate of state-condoned collective bargaining has resulted in stage-setting wage increases in China by some foreign-invested enterprises. This heralds a quickening of industrial upgrading as more and more labour-intensive operations have been moving further inland. The trend of wage increases, together with an expected gradual appreciation of the RMB, will also generate more purchasing power for the masses. This is likely to spawn a more consumption-oriented Chinese middle class who will serve to re-balance an over-export-dependent economy. In this regards, you may wish to re-visit my research note ‘Rise of the middle-class – the birth of a consumer society’ at http://www.andrewleunginternationalconsultants.com/files/chinas-megatrends-3-rise-of-the-middle-class-3.pdf
The June 2010 Global Economic Conditions Snapshot, a McKinsey Global Survey of executive sentiments across the world, may be accessed at https://china.mckinseyquarterly.com/PDFDownload.aspx?ar=2621&srid=417
Capturing the game change in the current global dynamics are my following two powerpoint presentations:
(a) ‘Global Paradigm Shifts and Game Change with a Rising China’ (a contribution at the recent Forum Istanbul 2010, Turkey) at
http://www.andrewleunginternationalconsultants.com/files/forum-istanbul-2010---global-paradigm-shifts-and-game-change-with-a-rising-china-1.pdf
(b) ‘A Sustainable China in a Turbulent World: Survival, Adaptation and Transformation’ (a contribution to the TOChina Program of the University of Turin, Italy) at
http://www.andrewleunginternationalconsultants.com/files/a-sustainable-china-in-a-turbulent-world---survival-adaptation-and-transformation-tochina.-ppt.pdf
If you want an up-to-date background guide to the fundamental changes shaping China’s social, political and economic life, you are likely to do no better than browsing John and Doris Naisbitt’s 'China’s MegaTrends: The 8 Pillars of a New Society', Harper Collins, 2009.
At the other corner of the globe, Africa, the oft-forgotten continent, has very much come alive (Mckinsey Quarterly, What is driving Africa’s Growth, June 2010). A game-changer there is China’s resurgent role. At an African Banking and Financial Institutions Seminar held in Accra, Ghana, from 21-22 April, 2010. I did a presentation by video conference link from London as my scheduled flight was suspended thanks to Eyjafjallajökull. You may access this presentation ‘A New China-Africa Financial, Investment & Business Partnership’ at
http://www.andrewleunginternationalconsultants.com/files/ghana-presentation---a-new-china-africa-financial-investment-and-business-partnership.pdf
All of the above presentations and papers are accessible on my website www.andrewleunginternationalconsultants.com You may find convenient to save a relevant link on your computer, laptop, Blackberry or I-phone for later enjoyment at your leisure or as a China reference resource.
Those interested in executive education in an increasingly China-centric era may wish to visit my two modular China Business Study Electives which draw on well-researched up-to-date China business case studies. These Electives are (a) Understanding China Businesses and (b) Global strategic Management and Cross-cultural Management, consisting of ten classes of three hours each with pro-active student participation. The detailed syllabuses can be accessed at http://www.andrewleunginternationalconsultants.com/new/2009/07/china-business-study-modular-electives-updated-expanded-and-enriched-2009.html
I have started a CHINAwatch discussion group under LinkedIn where you may share your views at http://www.linkedin.com/groups?about=&gid=880457&trk=anet_ug_grppro
There is also a sub-group on Sustainable Development which you may join freely.
Please continue to let me have the benefit of your guidance, advice, comments, suggestions, and criticisms. Please also feel free to share any of my Papers, articles, presentations, and TV interviews with your colleagues or friends. You are welcome to publish any of them with full attribution.
If you think that I may add value to your endeavours in any way, please do not hesitate to let me know. On the other hand, if for any reason you do not wish to receive my emails, please tell me to delete your name from my databank.
Last but not least, for your information, my international consultancy has now been incorporated in Hong Kong. Do drop in to touch base or encourage your colleagues to do so. Apart from any professional or business exchanges, I would only be too glad just to share with you some of Hong Kong delights. My Hong Kong telephone numbers are (852) 2819 1323 Mobile (852) 6426 1050.
Have a great summer!
Best regards,
Andrew
www.andrewleunginternationalconsultants.com
Before the silly season starts, may I first wish you a delightful and rewarding summer.
If you fancy some entertaining reading while seeping a cool drink by the pool, you may enjoy a sketch on ‘Shanghai Expo 2010 – Impressions of the Future and the Past’ at
http://www.andrewleunginternationalconsultants.com/chinawatch/ This was based on my short detour to the Shanghai Expo before settling back in Hong Kong.
On the global front, the G20 Summit in Toronto on 26-27 June lost no time in coming to grips with national budget deficits, which the West has vowed to halve by 2013 with massive belt-tightening all around. This is happening while EU economies are still struggling to contain the Greek crisis with a European Financial Stabilization Fund, comprising €500 billion from the member states and €250 billion from the IMF. The fear, of course, is the possible transmigration into a full-blown Sovereign Debt Crisis across Europe and elsewhere. You may wish to re-visit the March 2010 Cover Story ‘Sovereign Debt Crisis: Ripple Effect on the Global Economy’ in the Chartered Financial Analyst at http://www.andrewleunginternationalconsultants.com/files/chartered-financial-analyst-cover-story---sovereign-debt-crisis-1.pdf
Meanwhile, a shadow is casting over the future of the Euro, whose deficiencies have recently been highlighted by George Soros at http://www.georgesoros.com/interviews-speeches/entry/george_soros_speech_at_humboldt_university/
The fortune is not vastly better on the other side of the Pond, as US employment figures are lower than expected while the Black Swan of Deepwater Horizon is adding to the anxiety. Whether the Keynesian recipe in The Return of Depression Economics (Paul Krugman, Penguin Books, 2008) will work better in these uncertain times is debatable. Meanwhile, there is no stopping the greenback printing press. In any case, having got his fingers’ burnt by excessive credit leveraged out of a dream of ever-rising home values, the US consumer is now starting to spend less and save more, regardless of credit availability. A post-bubble leveraging of the US consumer has just begun, according to Stephen Roach (The Next Asia, John Wiley & Sons, 2009, pp. 385-6). As US private consumption is six times that of both China and India combined, a sustained weakening of US consumption is likely to depress the demand side of the global economy in the coming years.
The only glimpse of hope, so it seems, is with the surging Emerging Markets, especially China. The increased flexibility for the RMB, the Chinese yuan, together with the green light given by China Securities Regulatory Commission for the Agricultural Bank of China’s proposed IPO, slated to be the world’s largest, have set the stage for a more buoyant mood. Though China’s Purchasing Managers’ Index has recently slipped to 52.1 from 53.9 in June, the launch of the Economic Cooperation Framework Agreement with Taiwan avoided any undue pessimism. The Agreement will also be beneficial to the Region as a China-centric supply chain hub.
What is more, the recent spate of state-condoned collective bargaining has resulted in stage-setting wage increases in China by some foreign-invested enterprises. This heralds a quickening of industrial upgrading as more and more labour-intensive operations have been moving further inland. The trend of wage increases, together with an expected gradual appreciation of the RMB, will also generate more purchasing power for the masses. This is likely to spawn a more consumption-oriented Chinese middle class who will serve to re-balance an over-export-dependent economy. In this regards, you may wish to re-visit my research note ‘Rise of the middle-class – the birth of a consumer society’ at http://www.andrewleunginternationalconsultants.com/files/chinas-megatrends-3-rise-of-the-middle-class-3.pdf
The June 2010 Global Economic Conditions Snapshot, a McKinsey Global Survey of executive sentiments across the world, may be accessed at https://china.mckinseyquarterly.com/PDFDownload.aspx?ar=2621&srid=417
Capturing the game change in the current global dynamics are my following two powerpoint presentations:
(a) ‘Global Paradigm Shifts and Game Change with a Rising China’ (a contribution at the recent Forum Istanbul 2010, Turkey) at
http://www.andrewleunginternationalconsultants.com/files/forum-istanbul-2010---global-paradigm-shifts-and-game-change-with-a-rising-china-1.pdf
(b) ‘A Sustainable China in a Turbulent World: Survival, Adaptation and Transformation’ (a contribution to the TOChina Program of the University of Turin, Italy) at
http://www.andrewleunginternationalconsultants.com/files/a-sustainable-china-in-a-turbulent-world---survival-adaptation-and-transformation-tochina.-ppt.pdf
If you want an up-to-date background guide to the fundamental changes shaping China’s social, political and economic life, you are likely to do no better than browsing John and Doris Naisbitt’s 'China’s MegaTrends: The 8 Pillars of a New Society', Harper Collins, 2009.
At the other corner of the globe, Africa, the oft-forgotten continent, has very much come alive (Mckinsey Quarterly, What is driving Africa’s Growth, June 2010). A game-changer there is China’s resurgent role. At an African Banking and Financial Institutions Seminar held in Accra, Ghana, from 21-22 April, 2010. I did a presentation by video conference link from London as my scheduled flight was suspended thanks to Eyjafjallajökull. You may access this presentation ‘A New China-Africa Financial, Investment & Business Partnership’ at
http://www.andrewleunginternationalconsultants.com/files/ghana-presentation---a-new-china-africa-financial-investment-and-business-partnership.pdf
All of the above presentations and papers are accessible on my website www.andrewleunginternationalconsultants.com You may find convenient to save a relevant link on your computer, laptop, Blackberry or I-phone for later enjoyment at your leisure or as a China reference resource.
Those interested in executive education in an increasingly China-centric era may wish to visit my two modular China Business Study Electives which draw on well-researched up-to-date China business case studies. These Electives are (a) Understanding China Businesses and (b) Global strategic Management and Cross-cultural Management, consisting of ten classes of three hours each with pro-active student participation. The detailed syllabuses can be accessed at http://www.andrewleunginternationalconsultants.com/new/2009/07/china-business-study-modular-electives-updated-expanded-and-enriched-2009.html
I have started a CHINAwatch discussion group under LinkedIn where you may share your views at http://www.linkedin.com/groups?about=&gid=880457&trk=anet_ug_grppro
There is also a sub-group on Sustainable Development which you may join freely.
Please continue to let me have the benefit of your guidance, advice, comments, suggestions, and criticisms. Please also feel free to share any of my Papers, articles, presentations, and TV interviews with your colleagues or friends. You are welcome to publish any of them with full attribution.
If you think that I may add value to your endeavours in any way, please do not hesitate to let me know. On the other hand, if for any reason you do not wish to receive my emails, please tell me to delete your name from my databank.
Last but not least, for your information, my international consultancy has now been incorporated in Hong Kong. Do drop in to touch base or encourage your colleagues to do so. Apart from any professional or business exchanges, I would only be too glad just to share with you some of Hong Kong delights. My Hong Kong telephone numbers are (852) 2819 1323 Mobile (852) 6426 1050.
Have a great summer!
Best regards,
Andrew
www.andrewleunginternationalconsultants.com
posted by Chinawatch at 4:28 am
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