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Voices of the world: Where have China's dividends gone?

Source:Xinhua Published: 2014-3-4 23:55:08

Against the backdrop of the annual sessions of China's top legislature and top political advisory body, "where China's dividends have gone" is becoming a catching topic.

From a lobster businessman in Canada to a fashion designer in Italy; from an IT engineer in Nigeria to an official at the Argentine Transport Ministry; from an official of the International Monetary Fund (IMF) to a renowned economist, all discussed this topic with great interest during their conversations with Xinhua reporters.

The interviewees talked about various issues under the topic, such as as expanding domestic demand, upgrading industry and overcoming difficulties, all closely connected to the agenda of the two sessions. They also agreed that the dividends of China will benefit not only China's development for the long term, but also would promote the growth of the world economy.

DIALOGUE 1

Xinhua: As Chinese people are getting richer, their demand overseas is rising remarkably and they are particularly fond of luxury goods. Have you felt these? What does the change mean to you?

"Do you know how many lobsters Canada has sold to China over the past three years? One hundred million Canadian dollars! ($90.9 million) Incredible!" Stewart Lamont, managing director of Tangier Lobster, said.

"I know more and more your people have come to big cities and they earn more and more. This is a big market for Canadian lobsters, a market that is growing handsomely, with more people moving to big cities and their income rising."

Tangier Lobster is located at Halifax, the world's second largest deep water port and Canada's renowned lobster production base.

Lobsters could be transported from Halifax to Beijing, Shanghai, Hong Kong and Guangzhou in China in about 40 hours.

"The Lobster Council of Canada is undertaking programs to promote brand and market for Canadian lobster in the Asian market. The plans will be rolled out, which should help the marketability of our lobster tremendously," Lamont said.

Maia Guarnaccia, brand marketing and communications director of YOOX Group Global, a fashion clothing company based in Italy's Milan, said the company "loves to localize" in China. In fact, the company did a special collection for the selected contenders for the famous "Super Boy" on Hunan TV.

YOOX Group, which began the multi-brand business in China in 2011, has been working intensively with selected Chinese designers both in China and abroad.

"The Chinese market is growing very fast, and is keen on e-commerce. Instead of being price-driven, now the Chinese consumers are more aware of the taste and style, sometimes they can be very picky," Guarnaccia said, adding that the company is trying hard to localize in terms of language,size, style and service because the market is of critical importance.

DIALOGUE 2

Xinhua: Have you seen more advanced "Made in China" products besides garments? Now the Chinese government is upgrading the country's industry, have you ever used "Made in China" services or "Made in China" high-tech products? And what's the change has brought to you?

"My Tecno phone is made in China and I have been using it for two years," said Olayanju Oyedeji, an IT employee in Lagos, Nigeria, holding a Tecno Phantom 7 phone. "I have used other brands like Nokia and LG, but I prefer this phone in terms of user experience."

Chinese phone brands like Huawei and Tecno are gaining more popularity in Nigeria, the largest country in Africa.

"Some people think Chinese products are unreliable because there are some cheap Chinese phones with poor quality in the market. But things are getting better with the introduction of high-end phones like Tecno," Oyedeji said.

Carolina Catani, an official of the Interior and Transportation Ministry of Argentina, who oversaw the whole process of bid and purchase of Chinese-built trains, said it only took nine months from signing the contract to delivery.

"The Chinese side has a very strong sense of serving the clients, as they respond quickly to our technical demands," Catani said.

"There are many Chinese products in Argentina, mainly daily supplies and home appliances. This was my first encounter with Chinese equipment. I was amazed by China's industrial manufacturing capacity. The driving and safety system installed in the trains is impressive, and the price is very competitive," the official said.

DIALOGUE 3

Xinhua: As an economist who has an interest in China, what do you expect most from the two sessions which are of great importance in China? How do you think of the recent international opinion about China's economy showing weakness?

"I understood well the importance of the two sessions to the Chinese people," Steven Barnett, a division chief in the Asia and Pacific Department of the International Monetary Fund (IMF), said.

"It is agreed that if China achieves economic transformation and sustainable development, it would be a blessing for the whole world. I don't think we should worry too much about the slowdown of the Chinese economy. China should focus more on the structural reforms instead of short-term results," said the IMF officer, who spent four years in China.

"China has made substantial progress in reducing external imbalances, with the current-account surplus taking up about 2 percent of the GDP, down from a peak value of 10 percent. However, in terms of reducing internal imbalances, more efforts are expected to be made, as consumption only takes up 50 percent of the GDP," Barnett suggested.

Eric Maskin, the Nobel Economics Prize Laureate and professor at Harvard University, said that "because of globalization we rely more than ever on cooperation."

According to him, the economic recession in Europe and the United States could be worsened without China. At the same time, China's success has relied essentially on the two.

"China is a hero in the recent economic recession. If China hadn't been there, that recession could be much worse for Europe and for the United States. Cooperation has been the key to all sides," he said.

The 9 or 10 percent of growth rate will not be lasting forever, no matter what kind of policy China is adopting, because the country has reached the point where it's no longer so much in "catch-up mode," but in the productivity frontier, and one of the risks that China currently faces and is set to solve is inequality, he said.

There is no doubt that China's policy to deepen reform is correct, but one or two years is not enough given the tremendous amount of work needed, Athar Hussain, director of the Asia Research Centre at the London School of Economics, said.

China's economy generally has no big problem, but it is facing social challenges, he said.

Moreover, the professor was very concerned about how China would adjust central and local governments' tax revenues. He warned China against Japan's failure for slow decision, urging China to keep quick decision-making system.
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