Strategist: Lack of reforms halting China growth ({{commentsTotal}})

Economic news from China has not been great lately, growth is cooling and pessimism creeping in on stock markets. SEB private banking strategist Peeter Koppel said faltering reforms are to blame.

Koppel told ERR radio that the economic growth in China is likely to slow down to 6 percent. It was around 7.4 last year, and between 10 and 8 percent in previous years.

He said stock markets are not a hugely important source of finance for Chinese companies and only around 7 percent of the population dabble with stocks and shares.

“If we look at the financial system, those who have lent to small investors to purchase shares, then those companies are not weak enough to create a domino effect,” he said.

“China pushed through economic reforms in the past 30 years and it had plans for further reforms. Thanks to those reforms, peoples' livelyhood improved, the political elite felt secure, and the legitimacy of the powers grew.”

“But if we look at the current leadership, it seems they have decreased the importance of reforms. They have global political ambitions,” Koppel said, adding that focus on political ambitions, symbolic and geopolitical influence have demoted reforms. He said this has led to the economy cooling.

Koppel said the region as a whole still has the structure for growth, with a young population, the need to catch up with the West and room for improvement in efficiency. “Some of those [East Asia] markets have suffered but not even close to as much as local Chinese markets,” he said, adding that local Chinese markets are fairly closed to foreign investors.

Editor: J.M. Laats



Siim Kallas.

Interview: Siim Kallas on ambitions, Estonian politics, and EU presidency

Following the local elections in October this year, Reform Party founder, former prime minister, EU commissioner, and presidential candidate Siim Kallas took on the job of municipal mayor of Viimsi, a community on the outskirts of Tallinn. In his interview with ERR's Toomas Sildam, Kallas talks about local government, his party, the EU presidency, and perspectives in Estonian politics.

ERR kasutab oma veebilehtedel http küpsiseid. Kasutame küpsiseid, et meelde jätta kasutajate eelistused meie sisu lehitsemisel ning kohandada ERRi veebilehti kasutaja huvidele vastavaks. Kolmandad osapooled, nagu sotsiaalmeedia veebilehed, võivad samuti lisada küpsiseid kasutaja brauserisse, kui meie lehtedele on manustatud sisu otse sotsiaalmeediast. Kui jätkate ilma oma lehitsemise seadeid muutmata, tähendab see, et nõustute kõikide ERRi internetilehekülgede küpsiste seadetega.
Hea lugeja, näeme et kasutate vanemat brauseri versiooni või vähelevinud brauserit.

Parema ja terviklikuma kasutajakogemuse tagamiseks soovitame alla laadida uusim versioon mõnest meie toetatud brauserist: