Will London G20 make a difference?

There is arguably no immediate remedy to rescue the failing world economy. But the forthcoming London G20 summit has drawn world attention, as it aims to make a mark in putting the global economy onto the road of recovery.

So will the London event meet up to expectations?

For the full story by Dongying Wang, published by Xinhua News Agency in March 2009, please click here. Also, please return to the blog to post your comment.

Frugality applies to all in economic downturn

Britain's recession is biting as hard as its unusually cold winter. The fall of banks, retailers, manufacturers and many other businesses have drawn much media attention with related figures and statistics reaching a saturation point.

But the impact upon individuals has generally been ignored, and worsening unemployment has only been highlighted as evidence of the severity of the meltdown in the country.

As the meltdown deepens, Britons are becoming more careful with their money and try to balance their budget by adopting a thrifty lifestyle.

For the full story, by Dongying Wang, published by Xinhua News Agency in January 2009, please click here. Also please return to the blog to post your comment.

Photo taken by Ben30's

Turbulent 2008 sees failing confidence

Christmas lights on London's Regent Street

The number “eight” usually means good fortune and luck in Chinese culture. But reflecting on the events of 2008, many people are doubting the good omen the number brings.

China has experienced a turbulent year, from snow storms, floods, earthquakes, milk powder contamination to recent business collapses due to global economic downturn.

The success of the 2008 Olympics and the election of Barack Obama have stood out to be the few inspiring and encouraging events of the year.

Globally speaking, 2008 has turned out to be a year of gloom and doom. It was exemplified by the global impact brought around by the Wall Street financial crisis, and the latest Middle East bloodshed which has left nearly 400 Palestinians dead.

Failing businesses and confidence have spoiled the year-end festival mood in the West, especially in the UK.

Economic recession in Britain is biting its retailers so hard that they are collapsing at a speed nearly as fast as the falling of a decommissioned building after the explosive is detonated.

Latest big British retail brands which have been affected by the downturn include children’s wear retailer Adams and music, DVD and games seller Zavvi.

Zavvi became the 3rd victim within 48 hours following the fall of menswear retailer The Officers Club and tea and coffee specialist Whittard last week.

Some 350 British retail companies have reportedly folded during the 3rd quarter of 2008, according to a UK insolvency service. The figure is 39% higher than a year ago. And 15 more big British relaters are predicted to meet the same fate by mid January.

Zavvi's demise is a domino effect of the closedown of the general store Woolworths, a subsidiary of which was supplying Zavvi.

Woolworths was due to celebrate its 100th birthday next year, but the ill-fated company has failed to survive the downturn and will be consigned to history by January 5.

Woolworths is clearing out all its high street stores across the UK. Its store window notice announcing "last five days" reflects well the declining British economy and creates a psychological blow to anyone passing by.

Losing in competition to online retailers and supermarkets is one reason why many high street sales are plunging. The loss of sales is why some of them have been forced into administration.

Offering Christmas sales had become the only option left for UK high street retailers to make the last-ditch profits of the year. If retailers fail to make money during the Christmas, there is a slim chance they will make it through the upcoming year.

For those who are in secure employment such as teachers and doctors, this Christmas offers a unique chance for them to enjoy a shopping spree. However, it has turned out to be the most depressing Christmas for those who have lost their jobs or are feeling uncertain about their future.

This misery was touched upon by Queen Elizabeth II as she started her annual Christmas speech. "Christmas is a time for celebration, but this year it is a more sombre occasion for many," she said.

Many people are enjoying shopping in the West End of London. For some, it is also a nice day out to feel the festival atmosphere. "I made a trip a few days ago to London, I have to say the Christmas lights on Regent Street this year are not as good as before, also only high-end stores were well decorated," said a resident from the outskirts of London.

The media in the UK does not help the gloomy situation at all. Job cuts and failing businesses are breaking the news and making the headlines nearly every day, painting a bleaker picture and sinking consumer's confidence to an all-time low.

British people have been warned of an economic slump deeper than expected. As a result, thousands of people have lost their jobs; an average 1,600 people will become jobless every day in 2009; house prices are predicted to fall 10 percent in 2009; more people are expected to claim social benefits. Even animal sanctuaries in the country have been inundated with dogs and cats as their owners discard them due to financial difficulties.

Church leaders in the UK have attempted to lift people's spirit during these dark times. Some have urged people not to base their happiness upon materialistic gains and try to see the light of hope at the end of the tunnel.

But their religious epithets will do little to comfort those with bills to pay.


Copyright Dongying Wang,

China seesaws between economy & environment

The highly globalized world is witnessing a spillover of the US financial crisis into Europe, Asia and elsewhere. The UK has been warned against a more severe and deeper economic downturn than expected; and Japan has also entered its first depression since 2001.

Job-cutting news is making headlines across the media, and a rising number of businesses are at the risk of collapse, painting a bleak picture.

China fails to escape the donimo effect. Its year-on-year GDP growth for the first three quarters of 2008 displays a falling tendency from 10.7% through 10.1% to 9%. With an 11.9% GDP rise in 2007, China needs its economy to grow by 8%, in order to guarantee jobs and avoid sliding into the depths of a recession, said economy expert Ye Hang.

Official figures show that south China's Guangdong Province saw more than 7,100 enterprises shut down between January and September this year. The majority of them operated in the Pearl River Delta, a key manufacturing base in China's export market. Price rises in raw materials, appreciation in the Chinese currency (RMB) and fund-raising difficulties are the top reasons behind the closure of many companies, local authorities have said.

It is forecast that 1/3 of export-oriented factories in Guangdong will meet the same fate in the next three years. This will result in restructuring the industrial mix locally, and even reshaping the global supply chain.

In response, adoption of economic stimulus measures becomes unavoidably the only remedy, though it is not a panacea for all problems.

Following US' $700 billion banking bailout in October, China recently launched its own economic stimulus package, in which it intends to spend 4 trillion yuan (US$586 billion dollars) over the next two years. Rural infrastructure, water and rubbish treatment are among the 10 major industries which China will invest in heavily. Concerns are growing over whether sustainable conceptions and practices will be incorporated in this large-scale industrial expansion.

The environmental consideration is often the first to be given up when an economy faces difficulties, said Wang Jinnan, Vice President of the Chinese Academy for Environmental Planning of the Ministry of Environmental Protection (MEP).

His concerns are also expressed by environmental groups. Hannah Griffiths, corporates campaigner at Friends of the Earth, said that her organisation had always argued that regulation was needed because when the crunch came, profits would come first. "We always felt that companies do not take CSR as seriously as they claim to and voluntary action does not work."

Wang added that the closure of businesses in Guangdong is helpful, in short term, for regional pollution control. However, he strongly suggested the government implement green practices in the vast national investment, to make the country achieve green GDP growth.

Shen Xiaoyue, Director of the Regulation Office of the Policy Research Centre for Environment and Economy of the MEP, said that there will be an urgent and heavy workload in the assessment of the environmental impact of new projects which are to be launched under the incentive plan.

Opinions are also split when it comes to the impact of the economic crisis upon China's companies involved in green industries.

The global crisis will present more opportunities than challenges for China's green industries, said Shen, which she believes will become a key strength for economic growth in China. She also highlighted that the middle and small-sized green companies should learn from overseas counterparts, and the government should grant them more favourable policies, especially in fund raising, to enable them to fly higher.

Companies, such as those involved in clean energy, wind power and solar photovoltaic industries will slow down as a result of the economic crisis, said Wen Yibo , Chairman of the Board of Beijing-based Sound Group, one of China's largest private green companies specialising in water and waste treatment.

Economic stimulus can only serve as a supplementary solution under such special circumstances, and it won't solve the fundamental problems. On top of funding, support of policies and the public is critical for green industries' development, Wen pointed out.

Over the five years up to 2011, China's investment in environmental protection is expect to reach 1.53 trillion yuan (US$225 billion), accounting for 1.36% of its GDP, a proportion believed to be amongst the highest in the developing world.

Copyright Dongying Wang