Economic Growth

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“The Economy, Stupid.”

My fascination with China began with a conversation. I was traveling back to Chicago from attending a wedding in France in the summer of 2017 when I accompanied an old college acquaintance. Throughout our journey home, he talked about how his parents struggled to move to the United States and how hard they worked in their white collared jobs (while facing prejudice in the workplace – go figure, California) to give their children a life they did not have growing up in China. Most of my Chinese-American friends echo the same story. During the late 1950s and early 1960s, a few bad policies and natural disasters led to one of the worst famines in Chinese history. The most conservative of estimates state that at least 15 million Chinese died of starvation (some scholars estimate double that number). Imagine. My father was born in 1960, which means my grandparents would have endured the famine. Imagine what that does to the psyche of a village reliant on agriculture, and how that destroys the social fabric of community. I know personally if my grandparents were starving, I would work damn hard to make sure I would not have to endure the same misfortune. This sort of reasoning has helped me in my mind explain why the Chinese seem so hungry to exceed economically.

My friend explained to me how much the economy back in China exploded since his parents moved to the United States. Now, with an MBA from the best business school in America, he and his colleagues were looking for opportunities… in China. I was mind-blown. Is the economy really as outstanding there as he says?

Yes. Yes, it is. One look around Shanghai and you realize you have stepped into the future. This city is booming. Finance, manufacturing, free-trade, tourism. This city is hitting every major aspect of China’s complex growing economy. The Chinese now purchase nearly 50% of global luxurious goods (think Chanel, Prada, Rolex, etc.), and they are the largest consumers of wine in the world. Communism? It sure doesn’t fit that image when you are strolling along the Bund or through People’s Square.

What I am learning is that the global economic future could very well be Asian, and cities like Shanghai are leading the way. And when the Chinese GDP annual growth is three times that of the United States at 6.6%, with 85% of Chinese believing next year will be financially better, it is difficult for anyone not to believe the sky (like the Shanghai Tower, which is the second largest building in the world) is the limit.

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Comments

[Mike shalabi]

True
True, I wish the US learn from the Chinese