Posts tagged ‘Economy of Australia’

10/02/2015

Pollution: The cost of clean air | The Economist

A DESOLATE scene surrounds Little Zhang’s Tyre Repair in the dusty rock-mining township of Shijing, in the northern province of Hebei. Zhang Minsheng, the owner, still gets some business from passing traffic. But the recent closure of nearby rock quarries, because of air-pollution restrictions, has taken its toll. He reckons his monthly income has fallen by 30-40% to around 4,000 yuan ($640). Next door a wholesale coal business has closed. So too have a small family-owned barbecue restaurant and an alcohol, tobacco and grocery store. Red characters posted by their entrances still forlornly proclaim their “grand opening”.

Last year on a typically smoggy day in Beijing, Li Keqiang, the prime minister, declared “war” on air pollution—a problem that has become a national fixation. Smog remains a grave danger in most Chinese cities, but environmental measures are beginning to show teeth. Regulators in the most polluted provinces are ordering mass closures of offending enterprises. In some areas officials are being punished for failing to control pollution. Policymakers are placing less emphasis on GDP growth—long an obsession of officials at all levels of government—and talking up greenness.

The transformation will be painful. China’s new toughness on polluting quarries, mills and factories coincides with an economic slowdown that will make it harder to create new jobs for those laid off. Slower growth is in line with the government’s efforts to curb wasteful investment, and with it a dangerous build-up of debt. The slowdown also happens to be helpful in curtailing pollution: China’s consumption of coal, a huge contributor to smog as well as to climate-change emissions, fell slightly in 2014 after 14 years of growth.

Mr Li’s war is especially bloody in Hebei, which is blamed for much of the smog in Beijing. Keeping the air of the capital clean is a political priority. Chinese leaders have been embarrassed by the damage caused to China’s international image by the city’s relentlessly grey skies. They worry that the smog could fuel dissatisfaction with the government and undermine stability in the capital, as well as affect their own and their families’ health. Dutifully, Hebei, which surrounds Beijing, has been trying to clean up. Since the beginning of 2013 it has reported closing down 18,000 polluting factories. In January Hebei Daily, a state-run newspaper, said that in Mancheng county, to which Shijing township belongs, 37 rock quarries and rubble pits had been shut.

via Pollution: The cost of clean air | The Economist.

14/08/2014

Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ

Australian house prices are rising quickly and demand from China is increasingly driving the boom, according to a report by Hong Kong-based brokerage CLSA.

The report, based on interviews with 50 industry participants in Australia, including major realtors, finds Chinese are now “driving the residential property market Down Under” adding that the “phenomenal investment” will continue for at least three more years.

CLSA says China is now the top source of foreign-capital investment in Australian real estate and anecdotal evidence indicates that foreign investment from China has continued to increase in 2014, having slowly accelerated over the last 5 years. The stock brokerage did not attempt to put a value on the investment.

CLSA said good education and a clean environment were driving demand from China.

“Australia offers both and we see no reason why its fundamental appeal will diminish,” it added.

There are currently only limited curbs on foreign buying of Australian property. Any newly built Australian property can be bought by foreigners . The purchase of existing properties needs the approval of Australia’s Foreign Investment Review Board.

Government data this week showed house prices nationally grew by 10% in the year-to-June 30, with Sydney prices racing at 15% over the same period.

The issue of Chinese investment in Australian housing investment has prompted concern among Australians about the potential to be frozen out of the housing market, especially the highly desirable inner city markets of Sydney and Melbourne.

A government investigation into the issue of foreign investment in Australian property is underway and will report its recommendations in October.  One of the limitations of the debate over the issue is that there is not reliable data on how much money is coming into property from overseas.

Australia’s central bank has been watching the rise in house prices but has so far downplayed the role Chinese money has had on prices growth. If house prices continue to climb, the reserve Bank of Australia might have to raise interest rates at a time when the economy is weak and unemployment at more than decade highs.

via Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ.

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