Wednesday, August 09, 2023

Actually pouring.

"Now the world's most populous country, India could experience a decades-long investment boom. Goldman Sachs Investment Inc analysts expect its share of equity market capitalization to quadruple between now and 2075 - reaching 12%, when it will be neck and neck with China's. (Over that same period, the US share is projected to drop by half, to 22%)." "China is the world's second largest economy, featuring a massive consumer market and advanced manufacturing. India has friendlier relations with the West and a young workforce." Although still the second largest economy, China's problems are multiplying. "China's consumer and producer prices both declined in July from a year ago, a sign of deflation pressure as demand in the world's second largest economy wanes. The consumer price index dropped 0.3% last month," while "Producer prices fell for a 10th consecutive month, contracting 4.4% in July from a year earlier." China's "Imports dropped 12.4% in July year-on-year," while "exports contracted 14.5%, steeper than an expected 12.5% decline and the previous month's 12.4% fall." Reuters. "Mexico and Canada have replaced China as the top providers of goods to the US as a nearshoring push encourages more diversified supply chains. The US imported $203 billion in goods from China in the first six months of the year, 25% less than in the same period in 2022, based on the latest unadjusted data from the Commerce Department." ET. However, things are never as they seem. To bypass trade restrictions, "scores of major Chinese companies are investing aggressively in Mexico, taking advantage of an expansive North American trade deal. Tracing a path forged by Japanese and South Korean companies, Chinese firms are establishing factories that allow them to label their goods 'Made in Mexico', then trucking their products into the United States duty-free." ET. But, when it rains, it pours. "Typhoon Doksuri slammed into southeastern China's Fujian province on July 28," and "The rains that followed soaked Hebei, a province of 75 million, and the neighboring cities of Beijing and Tianjin. Flooding in those regions stranded residents, washed away bridges and highways, killing about 30 people in total, according to Chinese authorities." CNN. But, of course, flooding cannot be permitted in Zhongnanhai in Beijing (wikipedia). "Nearly 1 million people in China's northern Hebei province were relocated after record rains forced authorities to channel water from swollen rivers to some populated areas for storage, sparking anger online over the homes sacrificed to save Beijing." NDTV. The deputy commander of the PLA Rocket Force Wu Guohua died under mysterious circumstances on 6 June, India Today, and, recently, "China replaced two leaders of an elite unit managing its nuclear arsenal, triggering speculation of a purge." BBC. All very well, but will India gain from China's problems? We hope.    

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