The Great Debate UK

from The Great Debate:

Bet on small firms to lead China global foray

Photo

Wei Gu--Wei Gu is a Reuters columnist. The opinions expressed are her own--

Chairman Mao used to say the truth is always kept by the minority.

A little-known private Chinese machinery company's bid for a GM marque has been sneered at by even the patriotic Chinese media, but the deal could succeed where mightier plays like Chinalco's for Rio Tinto have failed.

True that private sector firms face an uphill battle in China against more dominant state-backed firms, but it seems like double standards when Western observers, who extol the virtues of the private sector taking the driver's seat, praise Chinalco's deal but dismiss Tengzhong's bid for Hummer.

Chinese media's disapproval of Sichuan Tengzhong Heavy Industrial Machinery's move has tempered concerns about technology and job transfers to China, as well as questions whether China's military was behind the bid.

This could give Tengzhong more bargaining power with bankrupt General Motors. Underestimation of Tengzhong could prove beneficial to the buyer in an environment where there are worries about Chinese deals not being completely driven by commercial interests.

from The Great Debate:

China’s U.S. debt overhang needs Chinese cure

Photo

Wei Gu -- Wei Gu is a Reuters columnist. The opinions expressed are her own. --

When U.S. Treasury Secretary Timothy Geithner told students at Peking University that China's holdings of U.S. Treasury bonds were safe, his answer drew loud laughter from the audience.

Even economist and columnist Paul Krugman, who is often critical of U.S. economic policy, found himself defending America when he was repeatedly asked the same questions in China recently: Will you (U.S.) underwrite the value of China's holdings of U.S. government debt? Will you be prepared to pay a much higher rate of interest against the risk of high inflation and dollar depreciation?

from The Great Debate:

The ugly attraction of fast shrinking Japan

Photo

James Saft Great Debate -- James Saft is a Reuters columnist. The opinions expressed are his own --

Sure, seeing your economy shrink at a 15 percent annual clip is depressing, quite literally, but if you believe in even a tepid global economic recovery in the second half, then Japan is actually attractive.

There is no way to sugar coat the first quarter Japanese gross domestic product figures released on Wednesday: they are breathtakingly bad viewed from virtually any angle.

from The Great Debate:

Time for China to act on foreign listings

Photo

wei_gu_debate-- Wei Gu is a Reuters columnist. The opinions expressed are her own --

China has talked about plans to allow foreign companies to float on its domestic stock markets for at least a decade, but that's all there has been: talk.

Now would be a good time to convert some of that talk into action. Beijing has been struggling with its own investment strategies: the state gets feeble returns on the U.S. Treasury bonds it owns, and its equity stakes in foreign financial firms are well under water.

Rio’s charm offensive

Photo

REUTERSJan Du Plessis, the man parachuted into the chair at Rio Tinto from British American Tobacco (they’ve so much in common), has spent a day on a charm offensive with the big shareholders in the mining group.

This Chinese deal is marvelous, he’s telling them. Not only do we get a fine price for selling what are merely minority, passive stakes in our mines, but just think of what we’ll be able to dig up in China with a powerful local to open the doors for us.

China economic forecasts: go herbal or Western?

(Wei Gu is a Reuters columnist. The opinions expressed are her own)

Which would you believe when it comes to diagnosing the health of China’s economy — the pulse-taking of the herbal doctor or the lab tests of Western medicine?

Beijing’s leaders are like the herbal doctors, using creative metrics such as power output and shipping indexes that can give a relatively accurate snapshot of manufacturing activity.

Don’t scapegoat the Germans for crisis

Photo

paul-taylor– Paul Taylor is a Reuters columnist. The opinions expressed are his own –

A revisionist theory on the causes of the global financial crisis blames surplus countries like China, Japan and Germany as much as highly-leveraged, deregulated finance in the United States and Britain.

from The Great Debate:

Don’t rush the Chinese to become big spenders

Photo

wei_gu_debate Wei Gu is a Reuters columnist. The opinions expressed are her own –

As the financial crisis forces American consumers to curb their shopping binges, the world starts to realize that China's high savings level has some upsides, marking Chinese consumption as the most resilient in the world.

Beijing has to, however, be careful in how far it goes to encourage domestic spending to help the economy ride the global downturn. Credit-driven booms and consequent busts from the United States to South Korea are pointers to the need for caution.

from The Great Debate:

World stuck with the dollar, more’s the pity

Photo

jimsaftcolumn5-- James Saft is a Reuters columnist. The opinions expressed are his own --

The dollar is, and will remain, the U.S.'s currency and its own and everyone else's problem.

The idea of creating a global currency, as espoused by China earlier this week, is interesting, has a certain amount of merit and is simply not going to happen any time soon.

from The Great Debate:

Myths around China’s revitalization plan

Photo

wei_gu_debate-- Wei Gu is a Reuters columnist. The opinions expressed are her own --

China investors should care about three major numbers this year: 8 percent economic growth, its 4 trillion yuan ($586 billion) stimulus package, and the 10 industries revitalization plan.

The first is the government's economic growth target and the second is a spending plan to shield the economy from the global financial crisis.

  •