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sharetea | 10 years ago

The article talks about investors needing to know that

1.) China's construction boom is over

2.) Need to understand China better

3.) Take off the rose-tinted glass

I would add a few more here:

4.) With all the capital controls currently in place, once you invest, you might not get your money out, ever.

5.) With president Xi becoming more dictator-like, and encouraging anti-foreign behaviors, once you get in to China, you might easily get in trouble. Jailed without trial. Or disappeared.

6.) With the great firewall becoming more restrictive, and VPN working less and less, you might not be able to hit any foreign websites from China. No communications with your family or loved ones. No search for foreign customers.

7.) With the impending yuan devaluation (20%-50%), it might not be worth it with a low growth environment in China.

discuss

order

mastazi|10 years ago

Points 4-6 (financial freedom, rule of law and freedom of communication) are all long-standing problems in China, and personally I believe that, if not fixed, they will prevent China from becoming, in the long run, a developed economy. However I don't have evidence that the situation is now getting worse in relation to these specific 3 points. I would be interested in reading reliable sources related to the above.

mikeash|10 years ago

6 is definitely true, just from personal experience. It used to be that you could just ssh to a server, tunnel your traffic over it, and you could visit whatever sites you want. Last time I was there, this past October, almost nothing worked. I could still ssh, but if I tunneled web traffic, they somehow detected that and killed the connection. OpenVPN didn't work. I tried a dozen VPN providers, most aimed at the Chinese market, and only found one that worked at all reliably. That one was pretty expensive and it's probably just a matter of time before it stops working too.

seanmcdirmid|10 years ago

4-6 seem to be getting noticeably worse. Xi is very different from Hu. Basically, things have been going backwards since 2008, but the backward momentum picked up in the last few years.