Four Important Trends In China Promise Big Changes
1) There will be a rise in the labor
movement as workers seek higher wages and better working conditions,
thus gaining a greater respect for labor laws.
2) As the nation continues to embrace
Western-style fast foods and greater meat-heavy fare, the growth of
obesity and diabetes will continue to expand. Already 30% of the
population is overweight and 92 million Chinese have Type 2
diabetes. (The International Diabetes Federation estimates 500
million Chinese might develop the disease by 2030 � which will place
a huge strain on China�s economy and productivity.
3) Since China�s intellectual property
rights continue to lag the developing world, Chinese innovators
can�t profit from their own advances. Because of piracy and
ineffective intellectual property protection their incentives to
invent will be undercut, placing a heavy drag on domestic
4) Despite having a savings rate of 38%
(10 times that of the U.S.) Chinese savers have few choices on where
to invest their money, namely real estate or domestic stocks.
Already a worrisome asset bubble in housing exists (12.4% increase
in prices year-over-year). Any widespread losses in real estate
would cause long-term financial pain for Chinese households, many of
whom have relied on the savings of three generations to buy a home.