China: Olympic Year, Olympian Challenges

Publication Date	March 2008
Publisher	Business Monitor
Product Type	Report
Pages	39
ISBN Number	not applicable
Product Code	BMI01567

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Summary

A year that has long expected to be China's coming out party is suddenly fraught with significant challenges. This special report analyses the building domestic political risks - ethnic turmoil and the soaring cost of living, which threaten to rain on China's Olympic parade.

Is Tibet the tip of the iceberg? The Olympic spotlight has helped to embolden Tibetan nationalists and international human rights activists, Western political leaders and celebrities to highlight and act upon simmering grievances with Beijing's policies toward the semi autonomous mountain region as well as Chinese economic and political activities in contentious countries. This poses two central risks to the ruling Chinese Communist Party. Firstly, unrest in Tibet and the threat of rising Islamist militancy in Xinjiang province directly challenges central government authority. A worst case scenario would see localized unrest spread to the wider Han Chinese population, with those benefiting least from China's stellar economic rise a potential flashpoint.

Secondly, activists, celebrities and Western leaders appear poised to continue criticisms of China's human rights record and dealings with verboten governments throughout the run-up to the Olympic games. The withdrawal by Steven Spielberg from an advisory role in the opening ceremonies, and the disruption by protestors of the Olympic torch lighting ceremony have crystallized these fears. Continued pressure amid what was designed as China's 'coming out party' will deal a blow to national pride and the carefully crafted strategy to project the country's rise as peaceful and harmonious.

Content

Olympic Year, Olympian Challenges
Domestic Politics
Unrest in The Periphery Could Spread Inward
Foreign Policy
Cross-Strait Improvement to Be Gradual
- Chart: No Man Is An Island
Xiamen to Benefit from Cross-Strait Thaw
- Chart: Waiting for The Breakthrough
Economic Activity
Gdp Data Highlights External/Domestic Trade off
- Chart: Showing Signs of Moderating
- Chart: Further Tightening Required
What Does Slower Global Growth Mean for Exports?
- Chart: An Ominous Correlation?
- Table: China - Balance of Payments
Demographics Point to Mounting Woes
- Chart: Working Age Population Will Peak Soon
- Chart: Current Structure Will Not Last
- Chart: Too Few Babies These Days
- Chart: A Grey Future Awaits
Monetary Policy
A Trap of Their Own Making: What next for Monetary Policy?
- Chart: Positive Carry A Tempting Prospect
- Chart: Steadily Ticking Higher
- Chart: Government Warnings Go Unheeded
- Chart: Few Signs of Slowing
Exchange Rate
Will 9% Appreciation in 2008 Be Enough?
- Chart: Picking up The Pace
- Chart: Danger of Tightening Too Far
- Chart: Little Short-Term Relief for Mounting Trade Surplus
Greater Twd/Cny Convertibility on The Cards
- Chart: Stability Remains Overriding Objective
- Chart: Unlocking The Door
Business Environment
Introduction
- Table: Bmi Business and Operational Risk Ratings
Institutions
- Table: Bmi Legal Framework Ratings
Infrastructure
- Table: Asia Power Consumption
Market Orientation
- Table: Demographic Indicators (2005)
- Table: Labour Force Quality
- Table: Asia, Fdi Inflows
- Table: China, Annual Fdi Inflows
- Table: Bmi Trade Ratings
- Table: Top Export Destinations
Operational Risk