Is Interest in China Fading?
48 hours ago, I posted this question on a Linkedin board to see what responses Linked in Users (more than 12 million users) came back with:
This summer seems to be much slower across the board, and I am curious if it is because of the recent coverage of China’s quality issues, if it is regulatory, or if it is because everyone has already been to China and got the tshirt.
As there responses began being posted (there are currently 20), I realized that I should have clarified this question by stating that a few friends and I were discussing how the new sourcing RFQ had fallen off lately and that we were not sure if this was seasonal, political, currency related, or due to the current news… but there was a definite slowdown.
Without the clarification though, the responses proved to be so interesting that I decided to let the question run, and I wanted to share some of the more interesting responses ( I have edited for length, if interested in seeing the entire thread, you can Click Here):
From Samuel -
Interest in China may be fading but that is a temporrary phenomenon from which, I feel, China will evolve stronger and better. Seasoned and qualified managers, processes and quality controls compliant with standards established by recognized industry groups must be put in place. Last but not least the employees must be fully trained in the procedures and standards. As China recognizes the need to formalize and put these changes in place it will evolve into a better and stronger industrial force to reckon with.
From Radu P
The Chinese economy is fundamentally out of balance and has been for a while. Some investors/partners may have gotten cold feet. IMHO these are the main questions:
1) how long will the boom last, given that it is primarily driven by government demand (infrastructure) as opposed to consumer demand. l to increase then the return on the infrastructure investments will be long and hard.
2) Financial opaqueness, at least compared to developed economies. Investors in China have little info to make rational decisions.
3) The RMB story. I am of the opinion that China should be able whatever they please with their currency.
4) The Party has lost the plot.
5) the energy problem; at these growth rates they better figure out fusion soon.
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