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This session will examine the impact of the crisis on China, the likely projection of its recovery and the role for the private sector.[vc_quotes layout=”accordion” quotes=”%5B%7B%22name%22%3A%22Michael%20Pettis%22%2C%22job_role%22%3A%22Professor%20of%20Finance%2C%20Guanghua%20School%20of%20Management%2C%20Peking%20University%3B%20Senior%20Fellow%2C%20Carnegie-Tsinghua%20Center%20for%20Global%20Policy%20(China)%22%2C%22content%22%3A%22Michael%20Pettis%20is%20a%20nonresident%20senior%20fellow%20in%20the%20Carnegie%E2%80%93Tsinghua%20Center%20for%20Global%20Policy.%20An%20expert%20on%20China%E2%80%99s%20economy%2C%20Pettis%20is%20professor%20of%20finance%20at%20Peking%20University%E2%80%99s%20Guanghua%20School%20of%20Management%2C%20where%20he%20specializes%20in%20Chinese%20financial%20markets.%20%5CnFrom%202002%20to%202004%2C%20he%20also%20taught%20at%20Tsinghua%20University%E2%80%99s%20School%20of%20Economics%20and%20Management%20and%2C%20from%201992%20to%202001%2C%20at%20Columbia%20University%E2%80%99s%20Graduate%20School%20of%20Business.%20He%20is%20a%20member%20of%20the%20Institute%20of%20Latin%20American%20Studies%20Advisory%20Board%20at%20Columbia%20University%20as%20well%20as%20the%20Dean%E2%80%99s%20Advisory%20Board%20at%20the%20School%20of%20Public%20and%20International%20Affairs.%5CnPettis%20worked%20on%20Wall%20Street%20in%20trading%2C%20capital%20markets%2C%20and%20corporate%20finance%20since%201987%2C%20when%20he%20joined%20the%20sovereign%20debt%20trading%20team%20at%20Manufacturers%20Hanover%20(now%20JPMorgan).%20Most%20recently%2C%20from%201996%20to%202001%2C%20Pettis%20worked%20at%20Bear%20Stearns%2C%20where%20he%20was%20managing%20director%20principal%20heading%20the%20Latin%20American%20capital%20markets%20and%20the%20liability%20management%20groups.%20He%20has%20also%20worked%20as%20a%20partner%20in%20a%20merchant-banking%20boutique%20that%20specialized%20in%20securitizing%20Latin%20American%20assets%20and%20at%20Credit%20Suisse%20First%20Boston%2C%20where%20he%20headed%20the%20emerging%20markets%20trading%20team.%5CnIn%20addition%20to%20trading%20and%20capital%20markets%2C%20Pettis%20has%20been%20involved%20in%20sovereign%20advisory%20work%2C%20including%20for%20the%20Mexican%20government%20on%20the%20privatization%20of%20its%20banking%20system%2C%20the%20Republic%20of%20Macedonia%20on%20the%20restructuring%20of%20its%20international%20bank%20debt%2C%20and%20the%20South%20Korean%20Ministry%20of%20Finance%20on%20the%20restructuring%20of%20the%20country%E2%80%99s%20commercial%20bank%20debt.%5CnHe%20formerly%20served%20as%20a%20member%20of%20the%20Board%20of%20Directors%20of%20ABC-CA%20Fund%20Management%20Company%2C%20a%20Sino%E2%80%93French%20joint%20venture%20based%20in%20Shanghai.%20He%20is%20the%20author%20of%20several%20books%2C%20including%20The%20Great%20Rebalancing%3A%20Trade%2C%20Conflict%2C%20and%20the%20Perilous%20Road%20Ahead%20for%20the%20World%20Economy%20(Princeton%20University%20Press%2C%202013).%22%2C%22image%22%3A%2231909%22%2C%22linkedin%22%3A%22%22%7D%5D” title=”Speaker” el_class=””][vc_quotes layout=”accordion” quotes=”%5B%7B%22name%22%3A%22Colin%20Tate%22%2C%22job_role%22%3A%22Chief%20executive%2C%20Conexus%20Financial%20(Australia)%22%2C%22content%22%3A%22Colin%20Tate%20has%20been%20an%20investment%20industry%20media%20publisher%20and%20conference%20producer%20since%201996.%20In%20his%20media%20career%2C%20Tate%20has%20launched%20and%20overseen%20dozens%20of%20print%20and%20electronic%20publications.%20He%20is%20the%20chief%20executive%20and%20major%20shareholder%20of%20Conexus%20Financial%2C%20which%20was%20formed%20in%202005%2C%20and%20is%20headquartered%20in%20Sydney%2C%20Australia.%20The%20company%20stages%20more%20than%2020%20conferences%20and%20events%20each%20year%20%E2%80%93%20in%20London%2C%20New%20York%2C%20San%20Francisco%2C%20Los%20Angeles%2C%20Amsterdam%2C%20Beijing%2C%20Sydney%20and%20Melbourne%20%E2%80%93%20and%20publishes%20five%20media%20brands%2C%20including%20the%20global%20website%20and%20strategy%20newsletter%20for%20global%20institutional%20investors%20conexust1f.flywheelstaging.com.%20One%20of%20the%20company%E2%80%99s%20signature%20events%20is%20the%20bi-annual%20Fiduciary%20Investors%20Symposium.%20Conexus%20Financial%E2%80%99s%20events%20aim%20to%20place%20the%20responsibilities%20of%20investors%20in%20wider%20societal%2C%20and%20political%20contexts%2C%20as%20well%20as%20promote%20the%20long-term%20stability%20of%20markets%20and%20sustainable%20retirement%20incomes.%20Tate%20served%20for%20seven%20years%20on%20the%20board%20of%20Australia%E2%80%99s%20most%20high%20profile%20homeless%20charity%2C%20The%20Wayside%20Chapel%3B%20and%20he%20has%20underwritten%20the%20welfare%20of%2060%2C000%20people%20in%2028%20villages%20throughout%20Uganda%20via%20The%20Hunger%20Project.%22%2C%22image%22%3A%2231893%22%2C%22linkedin%22%3A%22https%3A%2F%2Fwww.linkedin.com%2Fin%2Fcolin-tate-839a5a181%2F%22%7D%5D” title=”Moderator” el_class=””][vc_empty_space height=”10px”]
Key takeaways
COVID-19 has accelerated issues that already existed in China.
Some fear China’s significantly rising debt levels. Other worry more about the political implications of a rapid slowdown in growth. The latter group won the debate and settled on 6 per cent GDP growth for 2020. However, COVID-19 has derailed this.
Western economists don’t understand what GDP means in the Chinese context because China has a different accounting treatment of GDP. China’s publicly released numbers don’t include a GDP write down for bad investments.
Chinese growth is challenged because of high unemployment (around 20 per cent), a shift from consumption to saving and a lack of business investment.
If monetary policy can’t accommodate a significant increase in debt, enormous disruptions will impact the Chinese economy.
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Poll results
In 10 years time will your geographic investment allocation to China be:[vc_line_chart x_values=”” values=”%5B%7B%22title%22%3A%220-5%25%20(21%25)%22%2C%22y_values%22%3A%2221%22%2C%22color%22%3A%22blue%22%7D%2C%7B%22title%22%3A%225-10%25%20(26%25)%22%2C%22y_values%22%3A%2226%22%2C%22color%22%3A%22pink%22%7D%2C%7B%22title%22%3A%2210-15%25%20(33%25)%22%2C%22y_values%22%3A%2233%22%2C%22color%22%3A%22orange%22%2C%22custom_color%22%3A%22%235aa1e3%22%7D%2C%7B%22title%22%3A%2215-20%25%20(16%25)%22%2C%22y_values%22%3A%2216%22%2C%22color%22%3A%22turquoise%22%2C%22custom_color%22%3A%22%23ff675b%22%7D%2C%7B%22title%22%3A%2220%2B%25%20(5%25)%22%2C%22y_values%22%3A%225%22%2C%22color%22%3A%22mulled-wine%22%2C%22custom_color%22%3A%22%2350485b%22%7D%5D”]
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