Is the East no Longer Red? China's Erratic Flirtations with Markets

Resum

The assumption of control of the levers of power by Deng Xiaoping and the implementation of ecommtic reform in China hays yet to plan out to a logical end. Despite optimistic and bullish evaluations of the future prospects for China's economic future, there are numerous uncertainties which should be assessed. The first area of concern is that the reported estimates of economic growth are high1v misleading. In light of this observation, the rush to invest in China may be premature and may involve a speculative bubble which is both a cause and an effect of inflows of Western capital. Also, there are likely to he dimmer prospects for profitability of foreign investments in China.
Several other issues are also addressed here. Claims for the successes of China's gradualist market reform also invite scepticism. Additionally, the impact of Confucianism and the continuing role of the Chinese bureaucracy in the development of markets is considered. A final and over-riding issue considered is the conditions for consequences of the fractious pressures on China which threatens the hegemonic integrity of the ruling Party.