10th edition of Insight China: Session II 2011
Friday, 9th December 2011
China’s Economic Outlook 2012: The Zugzwang Scenario
The Chinese government is trapped in a scenario that chess players try to avoid at any cost: Zugzwang, a situation where one player is put at a disadvantage because he has to make a move when he would prefer to pass and make no move. Government control of increasing domestic inflation by tightening credit markets is leading to an economic slowdown (9.1% in third quarter) and might result in unemployment, with its dangerous social implications, as well as displaying latent overcapacity in the industrial sector and commercial real estate.
At the second session of the 10th Insight China, leading economists will examine China’s economic outlook for 2012, which also will be challenged by:
a) The sluggish world economy: Although emerging economies like China are showing better growth and resilience, they will not be immune to future economic volatility. IMF lowered already this year’s world economic growth projection to 4.3 percent (in 2010, the global economy expanded by 5.1 percent), due to the ongoing Euro Zone debt crisis and political uncertainty in the U.S.
b) Chinese mounting local government debt has tripled as a percentage of GDP since 2008 amid a carnival of inefficient spending. Chinese banks’ exposure to local government loans is 14 trillion yuan (3.5 trillion yuan larger than auditors estimated), potentially putting banks on the hook for deeper losses that could threaten their credit ratings. The ratings agency said a jump in local government loan defaults could push the non-performing loan (NPL) ratio for Chinese banks as high as 12 percent, well above its base-case scenario that envisions losses in the range of 5 percent to 8 percent.
c) China's new rulers will be elected at the 18th Party Congress in late 2012, raising both local and foreign business expectations/concerns on their position regarding a needed openness of the Chinese economy.
Speakers:
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Ma Jun (bio)
Chief Economist, Deutsche Bank, Greater China |
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Murtaza Syed (bio)
Resident Representative, International Monetary Fund |
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Arthur Kroeber (bio)
Managing Director, Dragonomics |
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Zhang Jianjing (bio)
Former Chief Editor of China Economics Times, and Executive Chief Editor of China Reform |
Moderator:
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Li Xin (bio)
Managing Editor, Caixin Weekly |
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The Agenda:
15:30-16:00 Registration
16:00-17:30 Presentation and Q&A
17:30-18:30 Networking and Canapés.
About Insight China:
Insight China is the European Chamber’s quarterly Macro Economic Seminar. Each quarter we invite leading economists to share their views and debate on current trends in the Chinese economy.
This winter will feature a double session of the Insight China series: “Global Debt Crisis: What Part Should China Play?” will be held on the 29th November at 16:00 in the Kempinski Hotel in Beijing and “China’s Economic Outlook 2012: The Zugzwang Scenario” on 9th December at 15:00 in the Marriott Northeast Hotel in Beijing.
Sponsored by:
Sponsorship opportunities are available at this event. Should you be interested in sponsoring this event, please contact Betty Yin at byin@europeanchamber.com.cn or 010-6462 2066 ext 23.
Media Partner:
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