|
Description: Follow us on TWITTER: http://twitter.com/cnforbiddennews
Like us on FACEBOOK: http://www.facebook.com/chinaforbiddennews
Economic data for July 2012 revealed weak growth in China.
The year-to-year growth in the CPI data
fell to a two-and-half year low in July.
This drop has shattered some economists' expectation
of the economy bouncing back in the middle of this year.
Financial institutions began to adjust their China
forecast of between 8% and 9% GDP growth in 2012.
Local Chinese Communist Party (CCP) authorities have
launched plans to stimulate and stabilize economic growth.
Experts say China's economic
policy has gone the wrong way.
Official attempts to use the local version of
4 Trillion yuan plan,
which will create fake economic prosperity will only
entrap Chinese civilians into deeper problems.
China's official data showed the CPI year-on-year growth
rate for July dropped to it's lowest in two and a half years.
The growth of both import and export has fallen, too.
Exports grew by 1%, far below the 11.3% in June.
Imports rose by 4.7%, less than the 6.3% in June.
Industrial added value and fixed asset investments
were all below market expectations.
The hard landing for China's economy has begun.
In order to stabilize economic growth, local CCP
authorities have launched a variety of investment projects to push the economy forward.
These are known as the local version of
the 4 Trillion yuan plan.
The plan aims at infrastructure construction,
with railway construction the preferred choice.
For example, in Wuhan, there will be a focus
on the construction of 82 transportation projects.
This will involve an investment of over 313 Billion yuan.
Economist Mao Yushi has said that the approach to
increase output by increasing investment cannot work.
China's overall economy has presented a serious waste.
Bad debt factors in the financial system have
caused potential hazards, according to Mao Yushi.
Mao Yushi: It's a wrong way to increase investment.
It should improve efficiency.
With high input and very little output, that will lose money,
and form a hole that postpones current difficulties.
It will be a bigger problem in the future
if the hole is unplugged.
Xie Tian is Assistant Professor
at the University of South Carolina Aiken.
He remarked on the CCP's economic stimulus policy.
In 2009, its 4 Trillion yuan stimulation
plan led to today's inflation.
Now the regime still uses the same
method to maintain GDP growth.
Xie Tian: The blind investment has inevitably become
a tool for the CCP officials to fill their own pockets.
That's why they've never been reluctant to launch
repeated, wasteful and unproductive investment.
The bad effects have been exerted on the entire community.
It has further fuelled the asset bubble and China's inflation.
Xu Jin, columnist of the UK's Financial Times,
commented that in 2009, the 4 Trillion yuan plan
was funded by fiscal revenue and bank loans.
The currency taken out by CCP central authorities
accounted for less than 5% of GDP in 2009.
The source of capital for the local 4 Trillion yuan
is still unknown, according to Xu Jin's commentary.
Rumors have raised in China that some
local authorities could go bankrupt.
Xu Jin said that local authorities
are also major market players.
Xu Jin warned that they have exaggerated political
achievements to gain favorable policies and financial support.
Xie Tian believes that the local version of the 4 Trillion yuan
plan would lead to another great leap forward of GDP.
Xie Tian: In order to maintain GDP growth, it has sought
bank loans, undertaken a lot of money printing,
and used various funding sources.
The money went to infrastructure and phony investments.
So it can achieve the figure it sets,
falsification will surely help to make it.
The target of the stimulation plan for Changsha authorities
is an investment of 800 Billion yuan.
The city's 2011 fiscal revenue was only 66.8 Billion yuan.
The media reported that in Changsha in the first half of 2012,
only 31% of total key projects were fully-funded.
The total investment on major business projects
only reached 21.78% of the yearly budget.
According to Xu Jin's speculation, local CCP authorities
would probably still utilize local and industrial policies to attract foreign capital.
The local authorities would still be poor in the funding.
《神韵》2011世界巡演新亮点
http://www.ShenYunPerformingArts.org/
|