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Chemicals and the Economy

China PE demand grows as food safety worries increase

China’s polyethylene (PE) demand has seen encouraging signs of growth in H1.  As the chart above shows (based on Global Trade Information Services data): Total demand is up 13% in 2013 (red column) versus 2011 (blue) Domestic production is up 7%, whilst imports are up 18% The Middle East is the biggest winner, with its sales […]

Unique and timely insight on China from John Richardson

Credit where credit is due, is the blog’s motto. It would thus like to recognise the insight of co-author John Richardson in being one of the first people to warn publicly that the economies of China and India both faced enormous risks in their quest to reach developed country status. Writing 18 months ago, when […]

China’s GDP data suggests rebalancing is now urgent

China has now published initial data on its key areas of GDP growth in 2012. As the chart shows, this highlights the major task ahead of the new leadership as they seek to rebalance the economy towards a more sustainable future: • Infrastructure (green) continued to increase as a share of GDP to 46% • […]

China’s polyethylene market sees slow growth

The usual flow of China’s polyethylene (PE) production data has been interrupted since the start of the year. But the good news is that normal publication has now been resumed. Thus the chart above shows market developments between January – April, versus 2012 and 2011, including trade data from Global Trade Information Services. PE’s position […]

China’s ‘Ponzi loans’ now 69% of GDP

China’s electricity consumption (green line) is the best real-time guide to economic developments. It is now beginning to confirm the blog’s suggestion that a major shakeout is underway as the new leadership takes charge: • Consumption soared in response to the massive stimulus programme • But it is now up only 5% so far this […]

China’s Q1 PVC imports drop 98% as housing bubble targeted

Q1 data from Global Trade Information Services provides further evidence of the slowdown underway in China. As the chart shows, the dramatic drop in net PVC imports suggests the new leadership are determined to burst the house price bubble they inherited: • Imports (red column) were down a startling 98% versus Q1 2011 (blue) • […]

China’s electricity consumption growth just 2% in March

As new premier Li Keqiang noted some years ago, China’s GDP statistics are “man-made and therefore unreliable”. But as leadership targets, they are very important in signalling the direction to be taken. Thus the blog is quite amazed that the financial sector has only now begun to wake up to the implications of the new […]

Licence plate trading drives Q1 jump in China’s auto sales

Something very strange happened in China’s auto market during Q1. As the chart shows, sales (red square) rocketed 20% in January/February versus 2012 (green line), before cooling to 15% growth in March. Neither government nor the auto industry expects this pace to continue: • Government forecasts are for 8% overall growth this year • Industry […]

China’s new leadership prepare for property price crackdown

China’s new premier, Li Keqiang, was the first senior official to confirm that the country’s GDP figures were “for guidance only”, being “man-made and therefore unreliable“. As he told the US ambassador in 2007, he instead used electricity consumption and bank lending (plus rail cargo) as his key indicators. It therefore seems appropriate to mark […]

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