From Bob Bestani on business in Bejing…

[Ed. note: What does it say about China when 2 ‘Groksters are there at the same time for different business activities? Terry, contributor to GilfordGrok, writes of his time in China here and here.]

After nearly a quarter century of visiting China, this country never ceases to amaze. In the mid 1980s, Beijing was still a very gray and shockingly backwards city. Cars were few and far between; the landscape was flat with the tallest building being only six stories or so; rivers of bicycles flowed throughout the city; its very somber people were dressed in uniforms of gray, blue or green Mao suits. Peat was still the most commonly used fuel to heat homes, even though it cast a thick pall of smoke and haze over the entire city. Rickshaws were the taxi’s of the day.
 
Today, Beijing is a colossal international city, with countless skyscrapers and modern ten lane highways that of necessity run through and around the city to serve its 17 million people. Every make and model of car has taken over the city streets. Its citizens are very brightly dressed in all the modern designer labels, and obviously happy with the prosperity they now enjoy. Every western brand of fast food restaurants, clothes, and vendors like Lenscrafters are scattered throughout this city which seems to extend out endlessly. Greater Beijing is said to be about the size of the entire country of Belgium. What a difference a quarter of a century makes!
 
With a total population of 1.3 trillion and a historically unprecedented level of economic growth, it is easy to see how projections suggest that China will soon be the largest economy in the world. Even in recession, China continues to grow at “only” 6% per annum. The country is sitting on over $2 trillion in cash reserves which the government is spending on yet more infrastructure projects to add a stimulus to the economy. Their banks are actively lending and their shops and malls are packed.
 
But looks are deceiving; just below the surface there is a quiet sense of unease. China, like virtually every country in the world, has been hard hit by the current financial crisis. Tens of millions of jobs have been lost, causing yet another mass migration, this time back out to the countryside. The problems that China faces are immense and every bit as daunting as the rest of the world is today facing – even bigger and more complex. Their 6% growth rate is hardly sufficient to maintaining stability and social order.
 
Their problems are such that the entire system of governance that has brought them to this point is under threat. For all of our problems, President Obama and Joe Biden do not have wake up in the morning worried that the legitimacy of the Presidency is at risk. President Jiang Zemin and Vice President Hu Jintao must worry about the future of the Communist Party. For decades now, the Chinese social contract has been very simple: we will give you economic prosperity – you keep quiet about political issues. While the next few years should remain calm, the clouds are there on the horizon.
 
Consider only few of their problems:

Read more