Economic power

Local governments in China are facing a problem of not having enough in their coffers, leading to various measures such as a hiring freeze in Hegang city. Corruption also remains a problem, with some officials using their authority and influence to line their own pockets. Zaobao correspondent Yang Danxu notes that there is a danger of such debt issues becoming a risk to social stability.

Chen I-hsin asserts that the US is no longer in a position to facilitate cross-strait talks, given that China’s national strength has increased considerably and the US is no longer seen as a neutral arbiter. Moreover, the “two states” theory which Taiwan’s ruling party seems to support leaves little room for dialogue, rendering any pressure from the US futile.

Though in word it professes to never seek hegemony or bully smaller countries, in deed, China behaves unilaterally and flexes its economic and political muscles for dominance in the South China Sea, says Indian academic Amrita Jash.

New regulations announced by the Chinese authorities seem to have made it more complicated for Chinese companies to get listed overseas, even though the variable interest entity (VIE) structure is still in play. Given the added obstacles ahead, will Chinese companies still want to go through the trouble of seeking overseas listings? Zaobao correspondent Chen Jing reports.

Commentator Chip Tsao notes that even as Chinese consumers are unhappy about perceived differential treatment by Western high-end brands in terms of returns and refunds, this is due in some part to their penchant for buying items and then easily changing their minds, or returning them after only using them once, perhaps just for selfies for social media. Not to mention the possibility of consumers’ irrational nationalism kicking in and the high costs of processing returns, it’s no wonder that brands are thinking twice before offering returns.

So far, Fitch is the only one of the “big three” credit rating agencies to release a statement raising the possibility of a review of the US sovereignty rating with negative implications. Financial commentator Tan Haojun says that the three agencies are giving the US a lot of leeway that would probably not be given to other countries, when they should be impartial and fair in giving a rating.

The combined output of members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is about US$13.5 trillion or 14% of global GDP, and will be even larger if China joins. From the economic perspective, there is much for all members to gain with China’s entry, but they would also be wary of certain aspects such as threats to their domestic industries and issues concerning intellectual property standards and regulatory non-tariff barriers. Cai Daolu looks at the reception China will be expecting to get to its CPTPP bid.

Vietnam’s trade deficit with China has grown rapidly since 2001, and its heavy dependence on Chinese intermediate and capital goods creates vulnerabilities in its entire production chain. Besides, China has a history of using trade as a weapon to punish countries with which it has disputes. To reduce its trade dependence on Beijing, Vietnam has signed a number of new-generation free trade agreements (FTAs) in recent years, but these efforts have not produced desired outcomes. Vietnam will need to increase the utilisation rate of these agreements and push forward economic and institutional reforms to strengthen its overall economic resilience.

Few may have heard of the Taishan Club, and even fewer would have been admitted. How did it come about, and why was it dissolved earlier this year? Commentator Yuan Guobao gives us a glimpse into this secretive group of super-elite businesspersons with high net worth.