5 reasons why China’s economic boom will keep on going on

The Money Show’s Bruce Whitfield interviewed Dr. Martyn Davies, Managing Director of Emerging Markets and Africa at Deloitte Frontier Advisory about why he believes China is not in meltdown.

Davies gave the following reasons why he’s not worried:

  • The current problem is one of supply (of commodities), not demand (i.e. in China itself).

  • China’s stock market is divorced from the real growth story.

  • De-leveraging is good thing (i.e. debt is forcing reform).

  • There are lots of policy measures available to the Chinese government.

  • There is no problem with a GDP growth rate of 7% (The last time South African economic growth approached 7% was in 1967!).

Scroll down for quotes from the audio below.

The fundamentals in China is exactly the same as it was six months ago.

Dr. Martyn Davies

China is an $11 trillion economy that is still growing at 7%. That’s adding half of South Africa’s economy every year!

Dr. Martyn Davies

Most of the traders on China’s stock market are individuals.

Dr. Martyn Davies

China’s net savings rate is 48%.

Dr. Martyn Davies

China’s slowdown is managed. This is not a crisis.

Dr. Martyn Davies

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