China Report Issue 48 May 2017

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1

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bynumbers

china

227%

45%

6.9%

1.13

us$120 billion

The year-on-year

increase in the use

of foreign capital by

Chinese real estate

developers in the first

two months of 2017,

a record growth

Share of tourism as most attractive

form of consumption for Chinese

consumers in 2017 in the annual

joint survey conducted by China

Central Television (CCTV), National

Bureau of Statistics of China and

China Post Group

Year-on-year growth of China’s econo-

my in the first quarter of 2017

The number of jobs available for every

job seeker on average in the first quarter

2017

Cash dividends distributed to share-

holders by 2,031 companies listed

on China’s Shanghai and Shenzhen

stock exchanges in 2016

Source: Ministry of Land

and Resources of China /

National Bureau of Statis-

tics of China

Source: Ministry of Human Resources and Social

Security of China

Source: China Association of Automobile Manufacturers Source: China Securities Regulatory Commission

The five forms of consumption most attractive

to Chinese consumers in 2017

Numbers entering the workforce in 2017

Year-on-year there has been a 50% plus rise in sales of

heavy trucks and semi-trailer trucks, an indicator of

China’s business activity, for six months

Land prices of the 105 major cities in China, Quarter 1, 2017

Average of

the total

land

Land for

commercial

service

estate

Land for

residential

use

Land for

industrial

use

0

2

4

6

8

10

Source: China Central Television

Price per square metre y-o-y change

amount of credit available via bank-issued
credit cards had reached US$1.3 trillion,
with US$7.7 billion of repayments being
more than six months overdue. The balance
of household mortgages had amounted to
nearly US$4 trillion by the end of 2016.
According to a report released by China’s
Research Centre for National Balance Sheet
in April, the leverage of Chinese households
has not only been increasing alarmingly
quickly in the past two years, but has already
become very high when measured by the ra-
tio of households’ debt to their net wealth.
Another new group who would benefit
from a law to handle personal bankruptcy
would come from the surge of small busi-
ness startups encouraged by the govern-
ment, as long as no more than 10 percent of
them were to end up insolvent. Li pointed
out the fact that a legal process of personal
bankruptcy would give all those debtors a
fresh chance to rebuild their credit record
from zero and to then access capital, much
better than being blacklisted by a court.
The most important aspect of legally per-
mitting personal bankruptcy, Li stressed, is
to build a stable, clear expectation for both
potential debtors and creditors when they
consider a deal. As he explained, the existing
36 percent maximum cap of private lend-
ing is just a judicial explanation from the
Supreme Court, not an article of a law. It
must be made clear by the law that some
debts of a person declared bankrupt are
written off in the process of legal liquidation
or reorganisation. Potential lenders will then
be more careful about choosing borrowers
to avoid legal defaults or legal punishment
if they use violence to collect the debts.
This, he believes, can help deter rampant ir-
responsible lending and borrowing, though
no law could completely erase a specific mis-
conduct.
If there were such a legal remedy and exit
mechanism, it would probably have pre-
vented the exit choice and subsequent legal
process for young Yu Huan. For so many
debtors and creditors in the high-interest
lending market, the sooner such a legal al-
ternative and exit is available, the less risk
they will face of ending up in a situation like
the recent tragedy in Shandong.

Tourism 45%

Electronic products 42%

Home appliances 40%

Food supplements and health services 34%

Training and education 27%

University graduates 7.95 millionGraduates of vocational schools 5+ millionReturning overseas students 0.4+ million Displaced workers from sectors of overcapacity 1+ millionnew migr

ant workers from rural areas 3+ million

(^0) Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017
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