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Speaker 1: Let's get to our guest way. Yeah. Ahead of research

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Speaker 1: for the Asia Pacific and Chief economists for the Asia

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Speaker 1: Pacific in China Associated General cib SO, we wanted to

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Speaker 1: take a closer look at the Chinese economy. The reopening

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Speaker 1: is happening. We don't know if it's precisely because of

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Speaker 1: the political side, i e. The protests that we saw

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Speaker 1: or more uh, the economic side, because the economy did

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Speaker 1: tank in November. But fast forward to it now they're

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Speaker 1: trying to open up the economy. Will it work, Yes,

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Speaker 1: of course, as it's working everywhere else in the world. Um,

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Speaker 1: the whole world has gone through it. Now it's China's

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Speaker 1: term now the now the COVID is underway, the outbreaks underway,

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Speaker 1: things as the virus is spreading. Yes, it would be

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Speaker 1: challenging for for for a few months, but now we

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Speaker 1: know China will gets through it. It's actually there. We

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Speaker 1: actually get much more clarity now they reopened than before.

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Speaker 1: So more clarity. Yes, and you're quite correct. All the

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Speaker 1: other major economies that have gone through this do come

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Speaker 1: out the other side, but they come out of the

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Speaker 1: other side changed and a lot of developed economies we're

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Speaker 1: dealing with inflation what might trying to be dealing with.

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Speaker 1: So China will not see as much inflation as as

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Speaker 1: in the West because throughout the whole pandemic, you know

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Speaker 1: things two thousand and twenty, China's fiscal response has been

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Speaker 1: distinctively different from any other major economies in the world,

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Speaker 1: which is, you know, they haven't provide much direct income

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Speaker 1: assistant to the households, so the amount of access savings

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Speaker 1: on the you know, at the household sector, at the

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Speaker 1: private sector is much less, which means, you know, there

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Speaker 1: is much less impulse of inflation, even if they come

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Speaker 1: out of the other end. So we're journalists, so we

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Speaker 1: have to ask the tough questions. Um, you know, we

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Speaker 1: understand that other countries have come through this. In China,

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Speaker 1: it's slightly different in that they have locked down a

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Speaker 1: lot of communities over a protracted period of time and

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Speaker 1: now they're kind of opening them up. Uh. It would

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Speaker 1: be understandable if both consumers are chasened by that and

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Speaker 1: are rather nervous and very cautious going forward, and also

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Speaker 1: the companies would be nervous about making big investments. Do

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Speaker 1: you see that happening, Um, you know, in a short

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Speaker 1: period or does it take a long time. UM. In

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Speaker 1: the next couple of months, certainly we'll see that we

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Speaker 1: were even potentiarially see supplaging disruptions coming back again because

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Speaker 1: people are sick. Uh. The amount may remain muted, UM,

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Speaker 1: but you will all pass. I agree. You know, if

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Speaker 1: we if we asked the question whether China could could

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Speaker 1: go back to you know, six percent or even higher

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Speaker 1: growth rates, I don't think so, but UM, but you

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Speaker 1: know for a few cultures, well see strong growth UM

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Speaker 1: very shortly, in a little over a month. It's going

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Speaker 1: to be lunar New Year. What sort of challenge does

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Speaker 1: that pose? Because you know, the natural instinct of many

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Speaker 1: Chinese seems to be at the moment stay at home.

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Speaker 1: But then of course ding a new year provides a

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Speaker 1: powerful motivation to get out, travel, be with your family.

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Speaker 1: What do you expect is going to happen? I think

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Speaker 1: it's a function of how fast outbreaks are progressing right

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Speaker 1: now in a lot of the big cities. And yes,

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Speaker 1: you know, the case numbers not not that informative anymore.

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Speaker 1: But we do see UM mobility data. We do see

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Speaker 1: you know, some of the search changing data which are

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Speaker 1: showing that the outbreaks are progressing extremely fast, and for

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Speaker 1: example in Beijing, Um, it's probably that they have reached

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Speaker 1: the peak with a very high percentage of population already infected.

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Speaker 1: Then you do the maths and you apply, you know,

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Speaker 1: the progression from other countries. We have a lot of

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Speaker 1: these things we can use now, and it seems that

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Speaker 1: maybe by the time of Chinese New Year, a lot

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Speaker 1: of cities will will will probably see almost the end

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Speaker 1: of this wave. Then people will feel more comfortable to travel,

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Speaker 1: so you will pass. Mr All, I'm sure you have

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Speaker 1: lots of friends and you're getting a lot of anecdotal

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Speaker 1: research done. You're hearing stories. Is the basic feeling that

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Speaker 1: people see some friends getting sick, but then they just

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Speaker 1: get through it, and it's kind of like what we've

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Speaker 1: seen in the West. Or is it different? Is it?

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Speaker 1: Is it more like you know, these these are really

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Speaker 1: serious cases because they haven't built up much shirt immunity. Um.

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Speaker 1: Well and totally yes, I actually know a lot of

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Speaker 1: friends and the family they have forgot it. Um. Luckily

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Speaker 1: the worst is a couple of days of fever than

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Speaker 1: they pass and and yes, people kind of start to

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Speaker 1: learn how to deal with there is certainly I can

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Speaker 1: see you know, at least from the people around me.

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Speaker 1: There is less panic now than you know, a few

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Speaker 1: weeks ago it was. It was almost like an unknown

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Speaker 1: or scary thing, but now it's much less. M You

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Speaker 1: talk about China eventually getting through this turning the corner

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Speaker 1: after a couple of corners of uncertainty, and typically when

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Speaker 1: Chinese growth does return to trend, we see a big

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Speaker 1: boosting and things like moodity prices, a big boost in

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Speaker 1: infrastructure spending. Are we going to see that again or

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Speaker 1: is this time going to be different. We'll see a boost,

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Speaker 1: but it's gonna be smaller than before. UM pastly, you know,

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Speaker 1: if we talk about structural growth right or the point

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Speaker 1: I mentioned earlier is that um housing or infrastructure, You know,

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Speaker 1: these sectors that the economy are allied on for fast

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Speaker 1: growth for many, many years, there is a clear question

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Speaker 1: of debt. Even though we do believe that housing will

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Speaker 1: see some recovery, but we don't think the housing will

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Speaker 1: go back to you know, the COVID pace of growth.

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Speaker 1: Neither was infrastructure. Next year. The recovery is going to

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Speaker 1: be led by consumption, but that's a function of a

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Speaker 1: pent up amount of people being locked for too long.

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Speaker 1: But after that, you know, we're going to be dealing

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Speaker 1: go back to deal with a lot of the structural

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Speaker 1: challenges of you know, what could be the new growth engine,

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Speaker 1: UM and how to resolve all these debt issues right

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Speaker 1: or wrong. Over the past eighteen months or so, the

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Speaker 1: party has seen aimed not so friendly to business. Now

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Speaker 1: we've seen because of the Work conference last week that

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Speaker 1: there are hints at more of a pro business push.

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Speaker 1: I should investors buy into that? From your view, Um,

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Speaker 1: it's um. This is why I'm we're positive. In the

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Speaker 1: short term, we do see that government is you know,

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Speaker 1: pivoting on almost every possible front, try to help the

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Speaker 1: economy to back on its feet, at least for the

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Speaker 1: next year or even maybe you know, a few years.

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Speaker 1: Possibly the focus um will be more kind of just

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Speaker 1: helping the economy to grow because yet they need to.

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Speaker 1: They have made a lot of mistakes or you know,

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Speaker 1: issues in the in the in the past a few years.

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Speaker 1: It's time to correct them. It seems that they're willing to.

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Speaker 1: One of the big stories in Australia where I am

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Speaker 1: is the departure today of the Foreign Minister Penny Wrong

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Speaker 1: to China for the first to visit by a foreign

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Speaker 1: minister since twenty eighteen. So do you see H getting

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Speaker 1: through some of these trade to sputes of the past

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Speaker 1: few years. Is that a policy U turn that we're

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Speaker 1: witnessing as well? H? This this what if? If? We

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Speaker 1: would use this word and very popular word, pivot. This

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Speaker 1: pivot actually started several months ago as as we we

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Speaker 1: could sense, which is, you know, diplomatically China is trying

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Speaker 1: to mend some issues. Was was a big Western countries, uh,

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Speaker 1: you know, the the visit of German German politicians to China.

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Speaker 1: You know, this is all very important sign very clear

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Speaker 1: sign already of this pivot. Alright, well we're out of time, unfortunately,

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Speaker 1: but very instructive, very informative. Thank you very much for

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Speaker 1: joining us. Wait yeah or yeah, weigh if you're a

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Speaker 1: purist Head of research for the Asia Pacific and chief

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Speaker 1: economist also for the Asia Pacific and China Associated General