CEIC China Data Talk: What Type of Economic Operations Will Be?

China Migrant Workers FAI Fixed Asset Investment Chart
China Migrant Workers FAI Fixed Asset Investment Chart

CEIC China Data Talk - June 28, 2016 China Premium Database + Labour Market + Employment + Investment + Fixed Asset Investment "China Model" has gained acclaim since the financial crisis. Since then, people seem to have overlooked the economic reform path China has undergone over the past 10 years, and even promote "China Model". Now, the time has come to assess the influence of "China Model" on economic development, and to consider what type of economic operations will be in the future. China had once introduced "Guo Tui Min Jin" (the state enterprises withdraw and the private sector enters) which not only prompted private enterprises to spring up, but also stimulated creativity. Nowadays, "Guo Jin Min Tui" (the state enterprises enter and the private sector withdraws) has taken place and lessened the enthusiasm of private investors. Pursuing the old traditional way is not always a bad thing. It has its merits. Yet, if the policy is problematic and continues its way, it is only a matter of time that problems get worsened and end up with a higher cost. Mass entrepreneurship in private sector could be fostered in a pleasant environment. However, "Guo Jin Min Tui" is now on the track, which is well reflected by the declining trend of private fixed assets investment (FAI) and migrant workers. As private FAI has accounted for more than 60% of total FAI, the slowdown in private FAI growth rate would probably pose a severe threat to economic operation and labor market, not to mention inviting private capital to arouse economic activities. Besides, the shrinking employment has already been signaled in the labor market. In fact, we could find traces from the floating population. Earlier, we have published a datatalk article "Thoughts about Usual Resident Population" interpreting the data of usual resident population and discussing how changes in such population within regions have revealed the economic downturn. In the article we have applied Guangdong and Dongguan to illustrate this phenomenon. We will not repeat the findings here, interested readers could refer to the related datatalk article. Contributed by the China Database Team Discuss this post and many other topics in our LinkedIn Group (you must be a LinkedIn member to participate). Request a Free Trial Subscription. Back to Blog

28th June 2016 CEIC China Data Talk: What Type of Economic Operations Will Be?

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