Michael Ivanovitch is president of MSI Global, a New York-based economic research company. He wrote a piece for CNBC which looks at the positive side of China’s economy.
Chinese are just warming up for their big ‘Belt and Road’. In the first half of this year, China invested $7 billion – a 22.2 percent increase – in 48 countries that are part of this giant multinational project. Again, the job leaders here are large Chinese publicly-owned firms.
One of them, the China State Construction Engineering, just signed up last week a mega-project to build Egypt’s $45 billion new administrative capital east of Cairo over the next seven years.
China will fine-tune its economic growth with a more balanced mix of monetary and fiscal policies. Some of that stimulus is already under way. Public spending in the first seven months of this year rose 13.4 percent. An additional 1.2-1.5 trillion yuan ($190 billion to $240 billion) in public spending is also in the pipelines to support growth through already approved investment projects.
Beijing has just set up a 60 billion yuan fund to assist the functioning and the creation of small- and medium-sized companies – a sort of Chinese Mittelstand. Also, an astounding 10,000 privately-owned companies are reportedly being registered in China every day. And a large number of the seven million college graduates entering the job market every year are becoming start-up entrepreneurs.
SOURCES – CNBC