4 ms·

I really don't understand the capital flight argument. The Chinese economy has seen overwhelming growth in the past 10 years. If you are searching for yield, it

• eightysixfour 9y ago
  The CCP's concern is that once people get wealthy in China, they want to leave China with the money.
  • booleanbetrayal 9y ago
    It's a legitimate concern rooted in past precedent. I also think this is partly why you are seeing large expenditures aimed at green-tech, etc. If you can turn around some of the social ills (namely pollution), you can stem the flow a bit.
    • vkou 9y ago
      It's not just quality of life. A lot of wealthy people have at least some exposure to criminal behaviour, and are not keen on being swept up in white collar prosecutions.
      • jiggunjer 9y ago
        Makes me wonder why Canada isn't run by triads yet.
• rossdavidh 9y ago
  Some of China's growth looks bubble-ish, even to wealthy Chinese. If you think that, you might want to get your wealth out before the bubble bursts.
  • rconti 9y ago
    Yeah -- or at the very least, diversify.
• TaylorGood 9y ago
  The government control in China is a driving force to spread your capital outside. Remember, average citizen can only transfer out $60k per annum. Not much.
  • evbots 9y ago
    Sure, but I can imagine that wealthy western investors also want exposure to growth in China (capital inflows).
• mincon4747 9y ago
  um, where have you been the past 2 years? China's stock market crashed, its forex reserve down 1 trillion, its millionnaires fleeing the country, it has imposed massive (but ineffective) capital control to prevent any money from leaving, its gdp/debt ratio way above 300%, its economy propped up by shadow debts.
• patio11 9y ago
  Much of the money getting made in China is ending up in the hands of government employees who should not have very lucrative jobs, and the combination of lavish personal consumption by them and obvious advantages afforded to their children ("princelings") is causing audible social discontent about corruption. The Chinese Communist Party considers audible social discontent to be an existential threat and responds to it with overwhelming force. Part of the response is banning public expressions of discontent. Part of it is shooting corrupt officials after show-trials. Part of it is rejiggering incentives, to make it clear that you'll have to keep your money under the watchful eye of the CCP rather than discretely investing it in a country which probably won't execute you.
  • dilemma 9y ago
    >Much of the money getting made in China is ending up in the hands of government employees BS
• georgeecollins 9y ago
  Some people making money in China are doing so through corrupt practices, or for other reasons fear that the government will seize their assets. These individuals probably continue to invest in China. They just want some of their wealth in a place safe from forfeiture.
• partiallypro 9y ago
  There is no argument, it's a fact. There is capital flight out of China. Their FX reserves have plummeted because they are trying to support the Yuan from dropping off the side of a cliff.
  • AlexCoventry 9y ago
    > Their FX reserves have plummeted On what timescale? WP says they have $3T, same as 2016. https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_China https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_C...
    • partiallypro 9y ago
      Says the very Wikipedia article you just linked? https://www.reuters.com/article/us-china-economy-forex-reserves/china-jan-fx-reserves-fall-below-3-trillion-for-first-time-in-nearly-6-years-idUSKBN15M0PH https://www.reuters.com/article/us-china-economy-forex-reser...