Sometimes, on rare occasion, a full week will pass in China and, to our surprise, not a whole lot appears to have happened. For all of the country’s incessant sociopolitical cacophony and ceaseless whir of economic clockwork, we find ourselves wondering whether anything actually changed in the last five days, or if we’re just kidding ourselves trying to keep track of it all.
Thankfully, dear readers, this was no such week.
We began with a whimper, it’s true, as China’s increasingly ineffectual premier, Li Keqiang, sought to de-emphasize the country’s annual economic growth goal of 7%, perhaps aware that no one was going to believe Beijing even in the unlikely event that it hit the mark. But a bang soon followed, albeit bullet-free, as the US Navy sailed one of its warships right up to one of China’s new artificial islands in the South China Sea and – in an unprecedented display of contempt – continued to sail right past on without even the slightest hint of altering course for a proper kowtow.
Perhaps the good men of the USS Lassen had simply lost its bearings–as had many an offshore investor after China’s longstanding deposit rate cap was scrapped by the central bank. Indeed, without a single clear yardstick for the cost of money in China, observers had become uncertain of what the country’s benchmark rate really was.
But third-quarter results from listed firms provided plentiful certainty on the trajectory of China’s former drivers of economic growth–down. A top executive with China’s steel association said demand was evaporating at “unprecedented speed“; the country’s top container manufacturer saw profit drop 65%; those of national petroleum champ PetroChina fell a jaw-dropping 81.4%; and yet the official figure for industrial profit appeared to have leveled off after a record fall one month prior.
Even online search giant Baidu saw quarterly profit fall by more than a quarter, though that was its own doing: A few days before posting results, the firm’s travel search engine Qunar entered a share-swapping tie-up with travel-booking firm Ctrip, giving Baidu a 25% voting interest in the latter. But rival Alibaba, defying the odds (or at least investor expectations) reported its revenue had jumped 32% for the quarter.
Indeed Alibaba and its e-commerce ilk are doing so well that shopping centers throughout the mainland are losing ground in retail as more of China’s shoppers hop online for their purchases. However much they do buy seems insufficient to assuage Beijing’s concerns over the mainland’s rapidly graying population, which this week spurred the leadership to change its one-child policy to allow two children per family, a scant 35 years after implementing the former restriction.
Of course precious few of those now able to have another child actually want to thanks to the tremendous cost of raising even one. But we suppose, dear readers, that in a week already bursting with vicissitude it would have been a tad naive to expect to cadres to abandon their longstanding tradition of halfhearted gestures toward social reform well and far after the fact.
As we said last time, perhaps they’ll really mean it next time. Things might well have changed by then.
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