It is apparent that if you wish to move up quickly in corporate America, just be willing to take a position in China for a while and upon completion of your project you should be rewarded handsomely for your sacrifice. In just 30 years the state controlled economy has become the world’s second largest. The government has concentrated on real estate and construction to fuel their economy. They forgot one major part. The people need to be able to earn a decent wage to afford to live in a great new home. The people earn next to nothing there.
Everyone bought real estate because property prices have gone up faster than inflation. Some have bought 5 or 10 apartments fueling the building boom. No nation has built so much so fast. Now real estate is the main driver of growth comprising of 20 to 30% growth to their economy. 12 to 24 new cities are being erected every year. America has a market driven economy. In China it is the government that has spent $ 2 Trillion dollars to get these cities built as a way of keeping the economy growing.
All over China there are new shopping malls that are completely vacant. There is non-existent supply for non-existent demand. There are cities in Mongolia able to occupy a million people with no one living there. There is an English development near Shanghai called Thames Town that looks just like streets found in England built about 5 years ago that is more of a photo shoot area for weddings than a place to live. Tens of millions of villagers are being displaced and living like homeless people since they do not have their rice farms anymore.
Now there are unfinished construction sites abandoned because the building boom has slowed down so less investment means less money to finish projects. It is becoming a debt crisis because of the huge loans the developers took out. If they can’t repay them, the whole economy will stop. The governments greatest fear is that once everyone has lost their savings in these investments there will be riots and a general desire to force a democracy.
The Chinese people are fascinated with the American way and appreciate the many successful American based companies. We should appreciate our way of life more.